Good day and welcome to the Dollar Tree Store, Incorporated fourth quarter 2008 earnings release. As a reminder today’s call is being recorded. At this time I would like to turn the call over to Mr. Tim Reid, Vice President of Investor Relations. Please go ahead.

Thank you [Katie]. Good morning and welcome to the Dollar Tree conference call for the fourth quarter of fiscal 2008. My name is Tim Reid. I’m Vice President of Investor Relations. Our call today will be led by Bob Sasser, our President and Chief Executive Officer who will provide insights on our performance in the quarter and recent developments in our business. Kevin Wampler, our Chief Financial Officer will provide a more detailed review of our fourth quarter financial performance and provide our guidance for 2009. Before we begin I would like to remind everyone that various remarks that we will make about future expectations, plans and prospects for the company constitute forward-looking statements for the purposes of the safe harbor provision under the Private Securities Litigation Reform Act of 1995. Actual results may differ material from those indicated by these forward-looking statements as a result of various important factors included in our most recent press release, our most current report on Form 8-K, our quarterly report on Form 10-Q, and the annual report on Form 10-K, all of which are on file with the SEC. We have no obligation to update our forward-looking statements and you should not expect us to do so. At the end of our planned remarks we will open the call to your questions, which we ask that you limit to one question and one follow-up question if necessary. Now I’d like to turn the call over to Bob. Bob.

Thanks Tim and good morning everyone. Thank you for joining our call. This morning we announced our earnings for the fourth quarter at $1.15 per diluted share. This is an increase of 10.6% over last year’s reported $1.04 per diluted share. As previously reported, total sales for the quarter were $1.39 billion. That is an increase of 6.8% over the fourth quarter of fiscal 2007 and comp store sales increased 2.2% in the quarter. For the full year and fiscal 2008, earnings per share were $2.53, an increase of 21% over last year’s reported $2.09. Total sales were $4.64 billion, an increase of 9.5% over fiscal 2007 and comp store sales increased 4.1%. Operating margin increased to 7.9% compared to 7.8% in fiscal 2007 and net income rose 14%. We’re very proud of these results. I am particularly proud of this year’s record performance given the backdrop of the worldwide economic crisis and unfavorable retail calendar and record high fuel and energy prices that we all faced. Even in the negative impact of severe winter storms that started in the Pacific Northwest and tracked across the northern section of the country the last ten shopping days before Christmas was largely offset by the strength of our business. And our warm weather stores, and as the storms passed sales in the affected areas rebounded, revealing the underlying sales strength of our stores. Even with all of these headwinds, sales results for both the fourth quarter and for the full year ended comfortably within our range of guidance, and our earnings results were at the very top end of guidance. I view this as further evidence of Dollar Tree’s relevance to the consumer. Our business continues to be strong and we’re off to a good start in 2009. We made a very…

Thanks Bob. It’s good to be with you here today and I’m very excited to be part of the Dollar Tree team. Turning to our fourth quarter financial performance as Bob mentioned our earnings per share for the quarter were $1.15. This was a 10.6% increase over last year’s $1.04. It was at the top of our quarterly guidance range. For the quarter, gross margin was 35.6% which was 20 basis points below the 35.8% in last year’s fourth quarter and was actually better than anticipated in our guidance. There were several factors impacting gross margin during the quarter. First, as we expected, our planned shift in product mix towards more consumable products had a negative impact on margin. Sales of food, health and beauty care basics and household consumables increased by 340 basis points as a share of sales in the fourth quarter compared with the same period last year. This was partially offset by improved merchandise margins in most product categories. In addition, freight costs decreased as a percent of sales in the fourth quarter. As most of you know, diesel fuel costs have been a significant drag on gross margin for most of the year. This began to reverse in the fourth quarter with the reduction in diesel prices and our ongoing improvements in operating efficiency. In addition, expenses for buying, distribution and occupancy decreased slightly as a percent of sales relative to the fourth quarter last year. SG&A expenses were 23.7% of sales for the quarter, a 20 basis point decrease from the fourth quarter last year. Lower depreciation, advertising and discretionary expenses offset increases in incentive compensation benefits increased fees for debit and credit cards, which reflect the continued growth and penetration of these forms of tender in our overall sales mix. Depreciation and amortization…

Thanks Kevin. I want to leave everyone with a few summary observations. For more than a year the retail environment has been especially challenging. Pressure on costs, especially fuel and energy, were the most intense they’ve ever been. But through it all, Dollar Tree where everything’s $1 has continued to grow and strengthen. In 2008 we generated positive comp store sales in every quarter; grew revenue by 9.5%; increased earnings per share by 21%; and improved our operating margins. Our investments in infrastructure continued to translate into better inventory management, more efficient stores, improved in stock position, and better execution of our model. While many other retailers have been pulling back we continue to open new Dollar Tree stores and our Deal$ stores are very exciting. We have the capital available to support our growth plans while generating substantial free cash. Our prudent cash management strategy in 2008 has put us in a strong position going into 2009 with much more flexibility than last year. As we enter 2009 we know that our customers are under intense pressure. We also know that they will find no better place to stretch their dollars than at Dollar Tree. We believe that we are positioned squarely in the bulls-eye of what customers are looking for and we’re focused on selling them what they want to buy. Our merchandise value and our increased mix of consumer basics make Dollar Tree more relevant now than ever and we’re determined to do everything we can to be a part of the solution to the daily challenge of balancing household budgets. We’re dedicated to building value for our long term shareholders. That means solid execution of our business plan and managing our capital in a way that enhances shareholder returns. Many of you have asked about share repurchase. In 2007 we repurchased $473 million of Dollar Tree stock. In 2008 in the face of economic uncertainty, we believed that it was prudent to build cash and we did not repurchase shares. A very sound strategy for the uncertain times. We currently have $454 million remaining in our share repurchase authorization. As has been our practice, we will continue to review share repurchase opportunistically as a potential tool for building value for our long term shareholders. We had a great year in 2008 and we’re determined to do even better this year. We’re off to a good start in 2009 with a very well executed Valentine’s season. And our stores are ready with a terrific presentation for the spring and Easter. We’re now ready for your questions. So that we can accommodate as many callers as time permits, we ask that you limit your questions to two.

Thank you. (Operator Instructions) Your first question comes from Adrianne Shapira - Goldman Sachs.

Bob, I’m just wondering, in the beginning of the call you had talked about, you know, obviously there was a weather impact calendar and it sounded as if there was a rebound in comps post the weather impact. You talked about a good start in ’09 with some impressive best Valentine’s Day in years. Can you just maybe elaborate a little bit in terms of what we’re seeing in terms of the underlying comp trend? Maybe explain a little bit in terms of the comp performance during the quarter.

Sure, Adrianne. You know we don’t report the monthly, but I’ll give you some color on that. We came into the quarter knowing that there was a calendar shift and we planned for it. As everyone knows, November – Thanksgiving moved to a week later, so it basically moved out the Thanksgiving to Christmas sales. We lost a week of sales, Christmas selling in November. We knew that and we planned for it and we thought that was about a $25 million bogey. We also thought some of that was going to move into December so it wasn’t going to be lost and we had plans to overcome that. What we didn’t know was that the succession of winter storms from mid-December through Christmas was going to impact our northern stores as it did. Holiday sales were very strong despite the weather, but as these storms swept across from the Pacific Northwest all the way to the East, you could track the sales and the comps across the northern part along with the storm. We think that the weather – the severe weather – by the way, when sales were being negatively impacted in the North, our sales in the South and the warmer weather stores were doing just fine, according to plan. Maybe a little better in some places. The stores as the weather passed through rebounded. So the underlying strength of the comp was there. We think the weather – it’s an estimate, the weather cost us $20 to $25 million of sales in the fourth quarter. But we still posted a respectable 2.2% comp and as the weather passed so did our comps rebound. We’re only three weeks into the year so too early to declare victory but we’re off to a good start. We had a terrific Valentine’s season. It was – I was very proud of our stores and the transition they made from Christmas and then to big game in January and then into Valentine’s. And if you had a chance to go to any of our stores, you would have seen Valentine balloons covering the ceilings the week before Valentine’s Day. Our stores did a terrific job and we had a really good, strong result for our Valentine’s season.

So to be clear, the weather $25 million and then the calendar shift another $25, so the two together that 2.2 gets you back closer to the 5, 6% that you had been running?

You can’t really add it all up like that, Adrianne. Again I’m just giving you the color, but we think the weather impacted us $20 to $25 million in fourth quarter. The calendar shift we knew about and when Thanksgiving – it does this every few years, Thanksgiving moved to the last week of November. Obviously we were going to feel it in November. Leading up into the Thanksgiving shift things were moving right along. Even through November they ran according to our plan because we knew about it. Some of that $25 million that was due to the calendar shift again we got it in December. We planned to get it back in December and we probably did. So you can’t – one plus one doesn’t equal two on these. What I look at with great confidence is the rebound as I saw the weather pass through the cold weather market. I looked at the sales in the market that were not adversely affected by weather and I looked at the rebounds as the weather passed through in the fourth quarter.

As it relates to the margin as you think about going forward you expect negative mixed shift from the lower margin categories, talk about what you expect when you lap that in the second quarter, you’re just going to anniversary it. That’s sort of a big step up, so help us think about what you would anticipate once you anniversary that step up.

Well, it’s all in our guidance and we do see a continued mix shift, more consumer products. Our consumer products is growing faster than our general merchandise products. Everything’s growing but the consumer products are growing faster. People are under pressure. I think they’re going to be under even more pressure going forward and I think they’re going to continue to. New customers are finding us all the time and I think that we’re going to continue to get new customers to buy the HBC products that we sell that are such a great value, the food products and all the things, the cleaning supplies that people need every day. So we’re going to as I said in my prepared statements we’re going to sell them what they want. We make money on that stuff, too. It turns faster. It does increase traffic. It’s more frequently purchased. It’s all good stuff as far as increasing market share and it’s proven the strength of our business. We have guided with the mix shift as we see it for the first quarter and for the year.

Your next question comes from Meredith Adler - Barclays Capital.

I’d like to follow on Adrianne’s question about the fourth quarter sales. The mix – there is a mix shift in the fourth quarter. I believe it’s more discretionary seasonal merchandise which as you said is growing slower. Are you willing to give us a sense of what the comps were for the consumables in the fourth quarter?

No, we don’t break it out to that degree. The mix shift as Kevin said though in the fourth quarter was 340 basis points. But it’s roughly in the 60, 40 – 40% consumables, 60% general merchandise we call it. It was a little more than that in fourth quarter and it did grow over the last year.

And then I’d just like to talk a little bit about your forcing the opportunities. I’m hearing things I think costs must be coming down in China but there are also a lot of factories closing. How do you think that’s going to impact Dollar Tree?

We’re excited and I hate to say it this way but you know the economic downturn there are pressures on the business and then there’s opportunities that come from that. And we’re seeing with the downturn in the worldwide economy we’re seeing more people wanting to do more business in China as well as all over the world. The Chinese factories are – their sales are down. They’re looking to do more business. That translates into better costs for Dollar Tree which as I’ve said before we look at it in really two ways. One, some of it we take in the form of margins. Some of it we take in the form of value to drive more to top lines. I just returned from China a few weeks ago and we’re working on next year’s Christmas and beyond. And prices were very favorable for us on the products – the categories that we source from China. And not only that, we’re starting to see products that we used to be able to sell for the margins that we want that we had dropped maybe over the years, we’re adding some of those back. We’re going to have our Christmas houses again this year which we were unable to have for the last few years. So some of this translates into more value which enables us to give our customers more value, drive more top line growth and some of it translates into a little better margin on our import [inaudible].

Your next question comes from Charles Grom - J.P. Morgan.

Just running some quick math here. It looks like your guidance implies operating margin erosion of about five basis points, maybe flat for the year. A couple of questions. One, is my math correct? And two, just wondering what your underlying assumptions are for gross profit margins and SG&A.

Well, Charles, as we looked at the year obviously, you know, it’s early. There are a lot of unknowns out there with regard to the economy and fuel prices and things, and all the things that I talked about earlier and the things that we’ve put into our guidance. I think looking at it, you know, we gave some pretty good comp guidance. There are not a lot of retailers out there that are guiding to low to mid single digit type comp increases. So I think we feel pretty good about that and the relevance of our business in the current environment. But we are concerned about the various pressures that could come about from things that are yet to come. So that’s all baked in there at the end of the day. And while we haven’t really spoken in the past directly to these percentages for the year at this point our guidance is what it is and we’ll let you infer what you believe that percentage is. But we feel pretty good about it and everything that’s going out there.

My follow up would be just on depreciation given that you’re growing stores say 6, 7% why are D&A dollars expected to be more or less flat? I guess why were they more or less flat this year as well? Just surprised that depreciation is not rising more given your square footage growth.

Well, obviously we’ve opened a lot of stores over the last few years and you know we depreciate the stores over the initial term of the lease which is five years, so you have a lot of stores that are dropping off on the back side. And with us opening 210 stores this year and another 25 Deal$ there’s just a natural progression that says it’s not going to grow at the same manner given the size of our overall store base currently.

Your next question comes from Michael Baker - Deutsche Bank Securities.

Very good comp this year obviously and operating margins I think were up nine basis points. You guided to a similar comp next year and margins about flat. I guess the question is in this kind of environment where the mix is going to skew towards consumables, is your margin about as high as it can get given the current environment? And then my second question would be on some of the comp drivers that you’ve had in 2008, things like rolling out food, EBT, credit cards, etc., does that provide the same tailwind in 2009 as it did in 2008? Thanks.

Mike, I can give you color on the margin. Is it as high as it can get? Probably not. Again we try to include in our guidance all the things that we don’t know. We try to give ourselves some credit for that. We are rolling out fewer frozen and refrigerated departments because we now have it in a lot of stores. So that piece of the business is slowing down. And that is amongst the lowest margin product that we have. We are as someone mentioned earlier – I think Adrianne mentioned earlier that we are lapping – anniversaring some of the expansions of the consumer products. So those two things there should be sort of an uplift on our margin. On the other hand, we don’t know where fuel is going to be. We don’t know what this economy brings to us and we’re trying to consider that as we try to make long term guidance in an environment that changes so rapidly. We’re trying to be credible I guess in our guidance in factoring those in. So you know there’s some upward opportunities. We certainly are taking advantage of all the ones that we can and see. And then there is the unknown out there. And that’s what you’re seeing in our guidance.

Your next question comes from Dan Wewer - Raymond James.

Kevin you may have given this number out and I may have missed it but when you look at the impact of fuel costs and how it diluted margin for all of FY ’08, could you remind us what that dilution level was?

I don’t know that we’ve spoken to the dilution level. You know, obviously we got some benefit in Q4 from the fuel costs coming down. And you know we’ve looked at it in the costs a year ago in Q4 was about $3.35. The cost in the Q4 this year was about $2.54. So obviously some pretty significant drops. I think probably what is as important if not more important in the long term is some of the things that we’ve talked about; the efficiencies we’re trying to drive through our logistics system because obviously we can’t control the price of fuel itself. But what we can do is continue to work on our efficiencies around cubing our trucks; controlling stem miles and leveraging the network in and of itself. The logistics team has done a really good job of this in a very difficult environment this past year and we expect that to continue. So I think that’s the way we really look at it.

Just recalling I believe in the third quarter conference call before you joined the company I believe they indicated it was 40 or a little bit higher and I think in the second quarter of ’08 the pressure on gross margin from fuel was around 20 or so. So would it be safe to say for the year it negatively impacted margins by about 20 when you think about the benefit in the fourth quarter and the pressures in the second and third?

You know, that’s probably in the ballpark. I think that’s a reasonable estimate.

So when you think about, you know, I mean you’re right no one knows where fuel prices are going, but if you were to take current pricing why would fuel not benefit margins by 20 to 40 basis points in ’09?

Well, it’s just too big a leap to make that fuel is going to stay where it is. We included again – we can give you a best case scenario, “Oh my gosh fuel is down. It’s going to keep going down.” But we didn’t do that. We took what we thought was the most likely. If fuel keeps going down obviously we’re going to benefit from it but I don’t know that I can or anybody on our side can quantify that as far as past what’s going on right now. We just don’t know.

And then Bob I know in the last couple of years you’ve been attempting to run SG&A so that it would run flat as a percent of sales if comps were up around 2%. Do you think that that type of threshold is achievable in 2009?

Yes, I think so. And look we are focused on SG&A as part of our D&A for one thing and secondly more so than ever with the rising costs that you saw across retail last year. And we faced all those same costs as everybody else did. Fuel was up. There was pressure on cost on merchandise. There was pressure on cost on [bags]. There was pressure on everything and we still increased our margins last year. We were able to lower our SG&A. We are doing that because a couple of reasons. Number one, we employ technology where we can to take costs out. We’re really focused on our processes. We have initiatives under way that would fill binders throughout the organization on how to take cost out of business through process efficiencies, through buying better. A lot of the things that we do now that were non-merchandise that we sell buying but product that we buy to use in our stores. We’re using reverse auctions. We’re using all the means that we can to leverage the size of our buy and to improve the flow and the efficiencies to take cost out. We do face minimum wage increases in 2009. That’s mostly going to impact us in the second half of the year. We believe that we can offset much of that through improved efficiencies, productivity in our stores and between the productivity increases in our stores and the initiatives that we have underway to smooth the product flow to our stores. We believe we can not only run a better store but we can do it at a better rate. So we believe yes, we believe we can continue to take cost out of the business. And we’ve proven that we have in the past and I think we will again in ’09.

Your next question comes from David Mann - Johnson Rice & Company. David Mann - Johnson Rice & Company: First can you quantify the dollars you expect from the Easter benefit and the comp benefit in the quarter?

I think last year we said it hit us for about $25 million when it was early, about as early as it could possibly be. So you could probably take that and launch that forward into this year as far as an opportunity where it benefits us. By the way, just for benefit of rehashing this, but the – you know a later Easter helps us in our Easter sales because it helps give us longer to sell our Easter product. But it also gets us past that bad weather that you sometimes have in March. When Easter is in March like it was in 2008, you’re always subject to something bad happening with the weather. When Easter is in April you pretty much get past that. What we see with these late Easters is a lift not only in our improved Easter sell through but also a lift in our summer seasonal toys and our other spring and summer products, as well as everything else. So we think there’s – you know you could say it’s probably a $25 million benefit to this year. That’s what we pointed to I think last year when it went the other way. David Mann - Johnson Rice & Company: And then secondly it sounds like you continue to be incrementally more positive on the Deal$ concept so can you talk a little bit on the operating metrics of Deal$, how those stores now perform relative to a Dollar Tree opening?

We’ve never broken out Deal$ separately. I’ve only ever spoken in terms of color and how we think about it, so I’ll attempt to do that now. The average ticket in our fourth quarter for our Deal$ stores was about $9.72 overall. The new Deal$ stores which I’ve said by the way is the best proof of the model is when we open a new store in a new area especially. Our new Deal$ stores were average ticket was $10.61 in the quarter. If you look at the average ticket when we had an item that was multi priced we call it, an item that wasn’t $1 in it the total was $15.65 in our Deal$ stores average ticket. The new Deal$ store’s a little higher than that at a little over $16. Our average ticket without the multi price $5.43. So you can see the average that the multi price is really raising that average ticket. Transactions with multi price our total transactions about 42% now. Last year in fourth quarter that was less than 28%. So there’s a big movement up on the transactions – number of transactions, percent of transactions that include multi priced items. Multi price dollars totals about a little less than 34%. With a new Deal$ store it’s about 36%. And our average unit retail still about $3. New stores, old stores and that comes I believe from the focus we have on the price points of around $5. Going forward we’ve still got a lot of work to do on this. I am very excited about it. I am very enthusiastic about it. It is a brand new model though. And new models take time to perfect. The sales productivity is improving. The comp store trends have accelerated in the Deal$ stores. Our…

Your next question comes from Patrick McKeever - MKM Partners LLC.

Just wondering I guess along those same lines, Bob, if you could talk a little bit more about the decision to scrap the oops test. I mean, what were you seeing there? Was it simply that sales of those products that were over $1 within the store were not as good as sales of other products? Or did the oops just having the oops merchandise the above $1 merchandise in the store did that actually hurt performance for the stores overall where the test was taking place?

Patrick, the sales on the over $1 item was almost incidental we found. And we sold some stuff but it was not a compelling offering. When you looked at the sales on that versus what we could do at the $1 price point it wasn’t compelling. Number two, it wasn’t accretive to margin. You know the idea that because you sell something for more than $1 you can make more margin is not valid. The things that we were selling that happened to be not $1 were the things that you would expect to sell. It was bundled packs of toilet paper and it was bundled packs of paper towels and large bottles of laundry detergent and those kind of things. All the things that we’re doing in our Deal$ stores by the way. So that was the things that we saw. It wasn’t accretive to margin. It wasn’t accretive to sales and it was distracting to the customer. They allowed us to do it. They never really embraced it. And we tried – by the way, we tested this in every shape or form across really more than a year. We changed stores. We did a lot of things. I think we gave it its due. But those are really the three things. It was distracting to the concept. And the other thing is and thank you for giving me the chance to say this, because if you look back at 2008 I don’t think anybody any retailer in America can say they didn’t see a more challenging environment to do business with from pressures from costs and pressures to increase costs on merchandising; to increase costs on everything you use, energy and diesel fuel. And Dollar Tree where everything’s $1 stood up really well during that time when all those pressures were brought to bear and all the uncertainty. And we increased our market share and we increased our bottom line and we did a lot of good things. So what we have now is a very clear strategy and philosophy and a strategy about growing the business. First of all, it’s Dollar Tree and in Dollar Tree everything’s $1 or less. We sell greeting cards for two for $1 and candy bars and things like that. But at Dollar Tree, everything’s $1. It’s clear the customer understands this. They love it. They respond to it. The earnings are terrific. At Deal$, everything is not $1. Everything is a value and we lifted that $1 restriction to bring more categories to the customer and to offer even more value to more customers as we go across the country. So our strategy I think by dropping the oops, it was the right thing to do to try it; it wasn’t the right thing to do to continue. We have a multi price point strategy. It’s called Deal$.

And then you mentioned that California and Florida were two of your three biggest states at this juncture. And I was just wondering if you’re seeing any – just given the fact that unemployment in California is I think pretty close to 10% and then Florida has all that – both states do, but Florida has a tough economy as well with all the housing issues. Do you see any different – is there any noticeable difference in performance for your stores in those markets in particular versus your stores elsewhere? I mean are you doing even better in places where the economy is even a little bit tougher than it might be elsewhere?

Patrick, we’ve always done well in Florida. It’s one of our oldest states. We’ve been in longer than almost longer than anywhere else with a lot of stores. We have good people down there. We have good stores down there. We’d like to open up even more stores frankly. I was out with the real estate team two weeks ago down south Florida because we’re finding the opportunity to get into some real estate now that was too expensive before. So we’re really looking to continue the growth. As far as the impact of that economy in Florida, I don’t know that it’s any different than the rest of the country. California tends to always be a little more challenging in operating. I will share that with you. Just the nature of doing business in California is a little more complex. We’ve been there since 1998, 1999 so we know how to do it. But when you look at some of the costs as you get into the Bay area, you know, it’s really high volumes but you also have the highest opportunities of business complexities in the business. And for the past year I would say that the West Coast did not lead our country comps in the last year.

Your next question comes from [Peter Keefe] - Piper Jaffray.

I don’t believe in this quarter you called out shrink as a positive driver to gross margin so that would be the first quarter and after the last three where it was not a benefit. Is there anything that changed in the quarter or is it simply just anniversaring some improvement from last year?

Yes, I think it’s more the latter in the sense of improvement versus going against improvement from a year ago. Nothing has really changed. You know obviously we recorded the best shrink in the history of the company last year which is obviously a testament to the process and procedures of our operations teams and our asset protection teams that put into place and are executing too. So very proud of that. It is going to in the current environment there’s been talk in the media that shrink could become more of an issue but I think that’s just talk. Our goal is to continue with the programs that we’ve put into place to control it and hopefully get better. At a minimum we need to hold where we’re at and hopefully at the end of the day get better.

And then also related to gross margin, you did comment that product margin had improved. I was wondering if you would just provide us with a little more color on that, if that was [inaudible] by better buying or lower markdowns or what was behind that? And how should we think about that going forward?

Well, going forward I think that the down worldwide economy equals opportunities to reduce cost on products. So going forward we are seeing pressure downward on costs which is good for us. There may be pressure upward later on margin or value for us. For the past year, though, we really – our merchants and our logistics team as I said did a really nice job of managing through all those pressures. Our merchandise margins from China actually grew last year over the year before. So even in the toughest of times they were able to negotiate the product, change the factories in some cases. You’ve heard me say before we can change the product, not the price. So as price pressures go up we change the product, always offering more value for the $1. As costs go down we take some of it in the margin, we take some of it into more value for the customer and an opportunity to drive more market share.

We have time for one or two more questions. Your next question comes from Karen Short - Friedman, Billings, Ramsey & Co. Karen Short - Friedman, Billings, Ramsey & Co.: A couple of questions just on automatic replenishment and I guess your planogram. So I guess my question is you know your competitors in the dollar store space are [planogramed], and given the higher frequency associated with the consumables and the fact that you’re not planogramed does that start to challenge your business model with the frequency? I mean I know some of your items or many of your items are on auto replenishment but I’m just wondering if you could kind of help me understand and triangulate a little bit. And then I have a follow up.

Yes. We look at it as a positive, an advantage. We look at planograms and Dollar Tree. We don’t do planograms at Dollar Tree because we want the flexibility as things change. If we get a better buy on another brand of whatever the item is, we want to be able to buy it and get it in the stores now. If you go to a planogrammed company, it takes them months to change their planograms and to actually change an item in their product mix. We’re fast. We’re flexible. We’re nimble. You give us an opportunity to buy something and we’ll buy it and have it in the store next week. And we see that as a huge advantage over our competitors, especially where price is always $1. If I get a better price for the customer I can do it, I don’t have to get rid of everything that’s in the pipeline for an old planogram. Now automatic replenishment. How do we do that? It works exactly the same way as it does at the planogram places. We make a lot of the same assumptions. We know what sales are in a store by category or even sales also of a like item if it’s not the same item. We set up our replenishment with a thought process on how many facings we’re going to put in a store based on what the sales potential is of the store. We know what the lead times are on the products. And then we put it out there and we replenish based on sales. And if stores sell more, they get more. And if stores sell less they don’t get anymore. And if by the way if we find a better toothpaste or a better soap, we buy it. And we’ll put it out there sometimes alongside the existing while the other item runs out. But auto replenishment works really good for us. We started off with a few items. I guess we’re probably up to 1,000 items now that we auto replenishment. That doesn’t mean that we have the same 1,000 items on January 1 that we have on December 31. Those items still change over the course of the year. Karen Short - Friedman, Billings, Ramsey & Co.: Just wondering I mean I know that Dollar General changed their hours to extend the hours in the stores. I’m wondering if you’re putting any thought towards doing that or if you have recently. And then also just wondering if you could give us an update on any potential changes in your advertising plans for ’09.

Well, we have store by store looked at our hours and we have changed hours in the fourth quarter and then again going forward. And we have found some opportunities where we could open earlier or stay open later or both. So that’s sort of a moving target, dynamic target. Advertising we’re going to spend about the same percentage we did last year. Most of our advertising is going to be focused on in-store efforts; building end cap; buying the merchandise the way we want to see it presented; make the impact to the customer; building the features the end caps, the tables, the side stacks in the store and then press opportunities. A little bit of electronics but mostly print opportunities that Kevin knows what I’m talking about that we’ll have in all the stores and from time to time we’ll actually distribute them via mail or via newspaper. It depends on the market. And then for grand openings we do some grand opening – things around grand opening, trying to open up our stores in a better way, get visibility in the markets that we’re in. If you look at the percent of advertising to sales, though, it’s going to be about the same.

We have time for one more question. Your last question comes from Joe Feldman - Telsey Advisory.

As far as the tax rate goes how should we think about that in ’09 because honestly it came in a bit lower than we had expected for the fourth quarter and I understand you mentioned there were some state resolutions that helped bring it down a little bit. But I guess what should we think about ’09?

Yes, as we look to ’09 we gave guidance here of 37.8% for Q1 and 37.3% for the year. And you’re right, in Q4 we did see some benefit from resolving some state audits and bringing those reserves off the books which was good. I would tell you for the most part that we’re pretty caught up with those kind of things. So I wouldn’t expect a lot of big benefits for things like that going forward. So that’s why you’ll see the rate potentially increase back to the 37% this year we just started.

And then also could you discuss with regard to the rollout of acceptance of Food Stamps, what kind of lift do you guys generally see in the store? And as you rolled it out, I would imagine you went to the stores that needed it most first. Are you seeing less of a lift as you roll it out to the rest of the chain?

Well, you know, we have increased the number of stores it’s in. It’s almost double where it was a year ago to 2,200 stores. But it is a very, very small piece of our business at the end of the day. So I don’t know that we really quantify what kind of a lift it creates but it’s an area that we think we can – you know, it’s another tender type. We can continue to be relevant to our consumer. And hopefully bring some more people in the door at the end of the day. But I don’t know that we really quantified it as far as a lift perspective.

This does conclude our question-and-answer session. At this time I’ll turn it back to Mr. Reid for any closing remarks.

Thank you all very much for participating in the call. Our next conference call is scheduled for Wednesday, May 27, 2009 when we’ll discuss our first quarter 2009 results and for information on any presentations that we’re giving please consult our website, www.dollartree.com. It has a schedule of presentations. It’s pretty dynamic and changes as we get closer. Thank you.

This does conclude today’s conference call. Thank you for your participation.