Good morning, everyone, and welcome to Lowe's Companies First Quarter 2015 Earnings Conference Call. This call is being recorded. [Operator Instructions] Also supplemental reference slides are available on Lowe's' Investor Relations website within the Investor Packet. While management will not be speaking directly to the slides, these slides are meant to facilitate your review of the company's results and to be used as a reference document following the call. During this call, management will be using certain non-GAAP financial measures. The supplemental reference slides include information about these measures and a reconciliation to the most directly comparable GAAP financial measures. Statements made during this call will include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Management's expectations and opinions reflected in those statements are subject to risks and the company can give no assurance that they will prove to be correct. Those risks are described in the company's earnings release and in its filings with the Securities and Exchange Commission. Hosting today's conference will be: Mr. Robert Niblock, Chairman, President and Chief Executive Officer; Mr. Mike Jones, Chief Customer Officer; and Mr. Bob Hull, Chief Financial Officer. I will now turn the program over to Mr. Niblock for opening remarks. Please go ahead, sir.

Good morning, and thanks for your interest in Lowe's. I am pleased that we've delivered another strong quarter with comparable sales growth of 5.2%. Comp growth was driven by a 2.9% increase in comp average ticket and a 2.2% increase in comp transactions. The team executed our plan and collaborated across the organization to respond to challenges. We employed a coordinated effort to stagger our Spring Black Friday events with a controlled cadence, as Mike will describe further, and we were well prepared to meet customers' needs for the season. Our ability to adapt to difficult operating conditions was tested by the prolonged labor dispute at West Coast ports. And I'm pleased with the team's diligent effort to minimize the impact these challenges created. I would like to thank our more than 265,000 employees in the field and at our support centers for their hard work and dedication to serving customers. Comparable sales growth for our U.S. home improvement business was 5.3% for the quarter. And while we saw stronger performance in areas of the country where weather was more favorable, specifically in the West and in Florida, all 14 regions generated positive comps. Additionally, our team in Canada delivered their eighth consecutive quarter of double-digit comps in local currency and their highest quarterly comp performance since we entered the market in 2007. We recorded positive comps in all 13 product categories with particular strength in appliances as well as seasonal categories, including outdoor power equipment and seasonal living. We remain focused on improving our profitability even while investing in key capabilities to drive our sales growth. For the quarter, we drove 76 basis points of operating margin expansion despite experiencing some discrete pressures, as Bob will detail. And we delivered earnings per share of $0.70, a 15% increase over…

Thanks, Robert. And good morning, everyone. We executed well in the first quarter, growing both average ticket and transactions. We drove traffic to our stores to our Spring Black Friday event, aligned to the expected arrival of spring from the Deep South to the North. To ensure our stores are ready to provide inspiration, information and products to customers, we use our enhanced Sales & Operations Planning process to coordinate inventory flow, advertising, product displays and training. And while the situation at the West Coast ports added complexity to our spring preparation, our transportation and logistics teams successfully collaborated to reroute product to other ports. As a result, our in-stock levels remain high. In fact, sales in our seasonal living category, which includes our highest concentration of imported products, such as patios and grills, exceeded expectations. We are pleased with our first quarter results, notwithstanding some weather-driven softness. Keep in mind that the outdoor selling season extends well past Memorial Day. To this point, in the second quarter, sales have exceeded our expectations. So we remain confident in the full year guidance we provided last quarter. Looking at category performance. We recorded above company average comps in appliances, outdoor power equipment and seasonal living. We achieved double-digit comps in outdoor power equipment as walk-behind and riding mowers drove strong performance in the West and South. We offer a wide range of mowers to help customers maintain their yards. And we continue to provide compelling and exclusive innovations, like our home channel exclusive Husqvarna All-Wheel Drive mower and our recently launched Troy-Bilt Flex product. The outdoor living experience we introduced last year drove high single-digit comps in our seasonal living product category and across all 3 geographical divisions. This particular customer experience most benefits our patio and outdoor fashion areas, which…

Thanks, Mike, and good morning, everyone. Sales for the first quarter were $14.1 billion, an increase of 5.4%. Total average ticket increased 3% to $66.63 and total transaction count increased 2.3%. As discussed on our fourth quarter call, we had planned for normal weather and thus, for Q1, to be our highest comping quarter of the year. In fact, weather in the Northeast was colder than normal and colder than last year while the West and Florida experienced the opposite. Therefore, the net impact of weather year-over-year was not the tailwind we expected. As a result, our sales for the quarter were slightly below our expectations. But we're still confident in our outlook for the year. Comp sales increased 5.2% as comp average ticket grew by 2.9% and comp transactions were up 2.2%. Looking at monthly trends, comps were 5.1% in February, 6.6% in March and 3.8% in April. Gross margin for the first quarter was 35.47% of sales, essentially flat to last year and in line with our expectations. We had positive rate movement from value improvement, which is offset by 15 basis points of pressure from the mix of products sold. SG&A for Q1 is 24.16% of sales, which leveraged 60 basis points. The expense leverage was driven by advertising, store payroll and impairment. Advertising leveraged 25 basis points, driven by the efforts to improve productivity, as Mike shared. Store payroll leveraged 13 basis points as we continued to optimize our staffing model. In the quarter, we had $8 million of long-lived asset impairment compared with $23 million in last year's first quarter, resulting in 11 basis points of leverage. Also there were numerous expenses that leveraged between 5 and 10 basis points in Q1. These items were somewhat offset by bonus, which deleveraged 35 basis points. Our…

[Operator Instructions] Our first question will come from the line of Brian Nagel with Oppenheimer.

A first question, I know you just spent a lot of time discussing the sales trends. But maybe if you could just help us understand better, if you would, the sales deceleration in the month of April, so the final month of your quarter because that was at odds with what your competitor said yesterday about their trends. So maybe just -- maybe some color -- more color there, please?

So a couple of things, Brian. First, as we think about the 3.8% for April relative to the 5.2% for the quarter, we did see some softness -- weather-related softness in some areas of the country for our seasonal categories. But as Mike said in his comments, we're exceeding expectations in May. So we're comfortable with what we're seeing regarding those seasonal categories in those parts of the country, where weather has improved. As it relates to what our competitor reported yesterday, if we take a look at -- so we're on a 4-5-4 calendar. If we take a look at our performance on a 4-4-5, which takes out some of the Easter shift noise that would've crossed our fiscal March into April of this year, we would have reported essentially a 5% comp for all 3 months of the Q1.

Got it. It was very helpful. And the second question, I have news that there was a news out over the past few weeks or month or so about the flooring category and some of the actions you've taken. Maybe just update us there on kind of what Lowe's is doing on the flooring category and if that had any impact upon the Q1 results.

Yes. Brian, this is Robert. I don't think we had any impact on Q1 results. But I'll get Mike to address the details of what we're doing in the flooring category. Mike?

Yes. There were a couple of articles, some articles out around 2 issues. One was relating to formaldehyde, in particular -- with one particular partner. What we did, in essence, was we took -- we put the products from that particular partner on hold. And we're going ahead and we'll review the certifications. All of our partners are required to give us certification. We're reviewing the certification and making sure that there aren't any issues. And so we'll work through that. As we look at our portfolio, we're very comfortable that we don't have issues. Our vendors are largely U.S. They've all certified with us that there are no issues. So we're very, very comfortable that we're in a pretty good place on this. And as we said, there was no issues relative to flooring going in the quarter. With respect to phthalates, the other concern that was raised on vinyl flooring specifically, more than 90% of our virgin vinyl flooring today is phthalate-free. We'll move that to 100% by year end. And again, we're comfortable that there's no big issues. And as we work with our vendor partners and we continue to scrub this, they're not finding any issues as well. So we don't see any impact on the quarter. And frankly, our flooring business continues to do well. And our reviews with our vendor partners continues to give us the kind of expected results that we expect.

Your next question comes from the line of Laura Champine with Cantor Fitzgerald.

This is Jason Smith on for Laura. I know you guys touched upon some of the new products -- introductions in the appliance category. But could you kind of give us a better sense as to just overall what drove the double-digit performance in the quarter and what you're seeing in the competitive environment?

Sure, a couple of things. We talked towards the middle of last year of making sure that our promotional cadence was aligned with what we saw in the market. In addition to that, we have more space dedicated to the appliance category than certainly most, if not all, of our competitors. And we offer the full way of brands. And so we like our position to go after market share in appliances. We've done a couple of things. We continue to launch exclusive and innovative products, like the Frigidaire Pro series that we've talked about. That's a home channel exclusive. And we also put in kitchen vignettes so that customers can walk in and see full vignettes of appliances and shop the different brands, looking at the -- how a kitchen would look, be it a recently remodeled kitchen or an existing kitchen with full vignettes. And we've seen a couple of things coming from that. First, our appliance sales remained strong, double digit both this quarter and last quarter. We've also seen an expansion of number of appliances per ticket. And so we feel real good about our position in the appliance business. We feel real good about our initiatives and we feel real good about the support our vendor partners continues to give us to ensure that we retain the #1 position in appliances.

Okay, great. And if I could just add one quick follow-up, any early feedback from the LowesForPros now that it's open to everyone?

Yes, Jason, this is Rick. Early on, we continue to get good feedback from the site. We've gone through the actual soft launch of that site on May 5. Currently, we have done no incremental marketing to the site. So what we're seeing is the gravitation of normal traffic to it. But we've been very pleased with the organic search and the organic growth of the site. It will continue to generate more awareness and more traffic as we continue to move throughout Q2. But so far, we've been extremely pleased with the interaction to the site, the number of registrations to the site and the activity.

Your next question comes from the line of Eric Bosshard with Cleveland Research.

Two things. First of all, could you give us an update in terms of the online, the results, the growth you're seeing in that and as well as the new efforts that you're implementing within online?

Yes, Eric, this is Rick. A couple of things, as we looked at dot-com sales for the quarter, they grew 25.5%. On a comp basis, Q1 traffic was up double digits to the site. And our conversion rate improved as well from an overall perspective for the quarter. The great thing was we saw both traffic at double-digit rates every month of the quarter and improvement in conversion for every month of the quarter. A few things that we continue to do, Mike talked about the new paint configuration tool that was launched to help customers visualize paint in their home. We made several other strategic changes to the site throughout the quarter as we continued to look for ways to improve the site, along with the filtering process, improving better filtering and better search terms. We also introduced 3 other aspects to the site. We introduced new 360 product views to about 11,500 of our highest-viewed items, which gives customers the complete view of the item across all aspects. We also introduced product videos to 214 different items that enhance the video capabilities of the customer to actually see the site, see the item and actually interact with it to a greater degree. And then we also enhanced the images to 9,400 items on the site in the quarter as well to make sure that we did showcase the product in a much better way to the customer. So extremely pleased with the growth that we saw during the quarter, most pleased with the improvement in conversion, which I believe is the result of the improved search terms, filtering and the incremental adds to product content that we've made to the site during the quarter.

And then a follow-up, Mike, I'd be interested in the magnitude of changes that you are making within merchandising, within LowesForPros. It seems like a number of things going on at the store level. Curious how the organization is digesting that, if this is net benefiting the business, if there are periods where there's some disruption as you implement these. How would you evaluate the pace of digesting the changes that you're implementing?

There's been a number of changes over the last, let's say, 2 years. I think the team is working through them well. We don't spend a lot of time talking about some of the new tools that have been deployed, like space planning, some of the workflow tools for our planning and review process, some of the improvements in pricing tools that get to mark-down optimization and promotional management, the efficient item assortment tools. I mean, we've rolled out a number of tools in the merchandising space that make the merchants certainly more data-driven as well as more effective. When you couple that with our approach to go after more of that Pro business, that's also facilitated the need for the merchants to do somethings very different, a different look on how we approach brands relative to national brands versus private label brands and those categories that lean very heavily to Pro. We're doing a lot of things very different. Here's how I answer that. I think you see a difference in our stores. I think our merchants and our vendor partners are excited about the changes that we've made. I think they like the success that we see in growth. And I think they're working through it well. I'm very proud of how the merchants have digested this. I'm equally as proud at how much support we've gotten from our vendor partners as we continue to work through these changes.

Yes, Eric, this is Rick. I would just add from a store perspective that you look at many of these initiatives, they've been ongoing for some time now over the last 3 years. And I give Dennis Knowles and the store teams a tremendous amount of credit for the number of hours that we've invested in training our associates over the past 2 years on the utilization of these tools and what these sets mean to our stores. So you mentioned LowesForPros.com. You think about the Pro, it's really been a 3-year journey of implementing brands, implementing inventory levels, implementing processes and organizational design, and then the addition of LowesForPros, which is the last component of that. So from a store perspective, there's been a tremendous investment in training, communication and dialogue to make sure that we're able to execute these programs as they rolled out.

And Eric, this is Robert. If we think about everything that Mike and Rick just described, including the product resets to come with new Pro-focused brands like Mike talked about in his comments in the first quarter when we brought in Sherwin-Williams, significant reset to take place in the stores that was done over the first quarter. Layered on top of that, the training that Rick just mentioned for all the associates at the Pro desk, those types of things, and then be able to deliver the results that we've had in the quarter. We're investing a lot for the future, but we're also doing it with a cadence that allows us to deliver great results like we did for the quarter. So I'm pretty proud with what the team has been able to execute.

Your next question comes from the line of Greg Melich with ISI.

So a couple of questions, I wanted to follow up a little bit on the trend through the quarter and where we are into the second quarter. I think, Bob, if you look at your presentation, you can just see how the comps get more difficult all year. Help us to understand how you see the year playing out in terms of what might be your hardest comp the rest of the way or your easiest comp to build up to your full year plan.

Sure. So we talked about the first half being stronger than the second half. But we also talked about as the year progresses, our 2-year comparisons, 2-year stack progressively increasing. So you heard the guys just talk about a lot of work the team is doing to improve our offering, our execution to the customer. Robert talked about the modestly improving environment for home improvement. So we do recognize that we are going against tougher comparisons. But on balance, the macro should be more constructive as the year progresses relative to 2014. So we're still confident with our plan for 2015, our ability to execute against that plan.

And it sounds like you think the second quarter, third quarter and fourth quarter, given all those things wrapped together, is actually reasonably even. Is that fair?

Not quite fair. I think I would say that our outlook has modestly decelerated comps, Q1 to Q2 to Q3 to Q4 and somewhat reflects the tougher comparison from last year. But as I said, we do expect the 2-year stack to modestly improve as we progress throughout the year as well.

That's great. And if I could have a follow-up question, just to understand a little bit on SG&A, the bonus expense deleverage. So we were below plan, but we deleveraged bonus. Could you help us understand that a little bit better as to how the absolute level versus the plan? Like why do we delever if we were below plan?

So a couple of things, Greg. First, we were modestly below our sales plan. We improved the flow-through relative to our expectations. So the earnings came in on plan. Still we accrued, generally speaking, on target for bonus for Q1. However, as Mike indicated, we had record performance from our customer satisfaction scores. So the approved -- the only aspect of plan that was above -- the only aspect above us -- that was above plan was the customer-focus program for the store associates. The majority of deleverage came because of the softness last year. Because of the dramatic performance below plan last year, it caused us to unwind some bonus accruals. So coming into the year, we had anticipated having deleverage in Q1. That's one of the pressures I've talked about on the Q4 call is we would have some bonus deleverage in Q1. It was a little bit higher than expected because of the record customer service scores that were recorded.

Great. And then just quickly, paint was a below-average category. Now that you're through that transition, any estimates to how much that could have hurt the quarter and how -- just give us -- remind us how big paint is as a category for you guys and what that could mean going forward?

Yes, I'll have the guys jump in. But as I said, we're through with the transition. Greg, we basically had the national launch of Sherwin-Williams basically right at the beginning of second quarter. We've got all the products in place, everyone trained. It was a below-average category, which I think is also what we saw from an industry standpoint, that paint was a little bit below average in the first quarter. So we probably had some disruption, I don't know that we've got an amount quantified because it was -- out of the reset as we went through the quarter. So I don't know that we've quantified that. But certainly, I think we've got the ability to show great strength as we're now backing up the national launch of advertising. Mike, is there anything you want to talk about?

Yes. I'd just add that we're really not disappointed at Q1. We knew that we had to get through a transition. We're through to transition. We -- the national advertising campaign is kicking in. We're actually very optimistic about it in the back half of the year.

Your next question comes from the line of Dan Binder with Jefferies.

I was wondering if you could talk a little bit more about the staff optimization work that you're doing, and then if there were any other notable categories that were softer than plan other than paint.

Yes, Dan, this is Rick. I'll start. As we look at the quarter, we continue to optimize our labor to our customer traffic, extremely pleased with the stores and what they were able to do in the quarter. We hired approximately 51,000 employees in the quarter. And during that transition, we were also, as Bob said, able to record customer satisfaction scores across our stores during that timeframe. Productivity increased, from a sales per hour perspective increased 4%, driving the 10 basis points of leverage. We continue to look for ways to optimize the store labor model to traffic as well as to maximize any of our nonselling areas and make sure that we're doing everything we can to drive productivity from those areas and put those hours back to the sales floor. We looked at, of course, our delivery productivities. We're seeing improvement there. We're seeing improvement in capability builds, the technologies that we're deploying and through the scheduling process as we continue to match our customer hour -- our employee hours to customer traffic. So those things, I think, are really helping us from a productivity standpoint, a staffing optimization standpoint, continue to maximize hours on the sales floor to meet the customer traffic to drive continued improvement in close rates during those peak times of day.

So I'll just talk to the merchandising divisional performance. So if you think about the ones that were above the average, appliances, outdoor power equipment, seasonal living, they were extremely strong, I mean, well into double digits, very, very strong. We had a couple that we felt real good about that don't show up in the above-average, tools and hardware flooring, millwork, kitchens, as an example, were great performers. I think where we saw pressure was primarily in paint and lumber and building material. And so lumber and building material, we understand that there certainty was a bit of a weather impact. We can track that one back. Paint, we saw pressure, but we expected it as we worked through the transition.

And Dan, this is Robert. Just a reminder, all categories were positive in the quarter, so.

Your next question comes from the line of Seth Basham with Wedbush Securities.

My question is around sales trends again, just making sure I understand this a little bit better. Because even on a 2-year stacked basis, Bob, we saw a pretty marked deceleration in trend in April relative to earlier in the quarter. Is there anything about that month that you can speak to, particularly given the fact that weather in the Northeast started to improve significantly then?

So Seth, as I said to the earlier question, a lot of it was driven to discrete weather across the country, not just Northeast, where we saw some seasonal pressure. That was for a couple of weeks towards the end of the month. However, we have seen trends improve in the seasonal categories in those geographies. So no real concern from opportunity to hit the Q2 and the 2015 outlook.

Yes. And Seth, I'd just add one thing, too. As we continue to look at the quarter especially for the North, as Mike said in his opening comments, we staggered our Black Friday events. So our Black Friday events in the North and Upper North actually moved into Q2 this year, not Q1. So that's some of the things that we're realizing as well in Q1.

And Seth, just to bring it into perspective, this is Robert. If you think about looking out over the balance of the year, as you look at our comp guidance for this year, our comp guidance is basically in line with the comps we delivered last year. If you think about last year coming out of the first quarter, we had 0.9% comp, so we had a big deficit to make up going over the balance of the year. Obviously, the first quarter this year, we got a 5.2% comp in the first quarter, so we're running ahead of what our trajectory -- or what our guidance is for the entire year. So obviously, coming out of the first quarter, we feel much better about being ahead of what we guided to for the year than the position we were in last year, where we had a large deficit to make up, so.

Great, that's helpful. And then a follow-up question, it's just around about big-ticket sales. Pretty big deceleration in big-ticket comps despite double-digit comps in OPE appliances, seasonal living. Were there categories that you can point to that drove the deceleration?

So we did see a pretty strong performance, 7.7% comp is good performance for big ticket that were driven by OPE and appliances. We also saw some good movement across all -- moving up across all categories in ticket size. So we're really not disappointed at all with the big-ticket performance in the first quarter. Obviously, there's a lot more momentum in Q4 last year that drove all categories higher but certainly not disappointed with the big-ticket performance in Q1.

Your next question comes from the line of Judy Merrick with SunTrust.

And just as you're looking -- as you're dedicating more space to these kitchen suites, have you seen any more strength across categories aside from appliances?

Yes, I'll start, Judy, and then I'll let Mike jump in on top of that. When Mike talked about the kitchen suites, he's really talking about re-laying the existing space that we had in the department in the way that we're arranging our offering of appliances into more of a suite versus an individual, all washers together, dryers, those type of things. So we haven't really dedicated more space from an overall appliance standpoint. It's just the way that we're going to market with those appliance category. So in that respect, you shouldn't see more space allocation impact on other categories.

And then just as an example, some of the categories where we're seeing strength, we certainly saw it in the appliance business as I mentioned. We see it in cabinets. As an example, by having the kitchen suites that are now in the stores sitting next to cabinets, as customers start to engage in some of those remodel projects in the kitchen, it's easier for them to shop at our stores and pull that project together. We saw strength in areas of flooring as well. And so we're pretty optimistic on how the customer is engaging with us to continue to execute and do those kitchen projects. I think -- and I don't know if you're going to talk to the project specialists' performance as well, Rick, which is also a good indicator.

Yes. As we say, Judy, the interiors -- or services business grew above the company average for the quarter. So we still see continued strength across our services business. In particular, we continue to see our exteriors and interiors programs work extremely well, which benefits from the experience creation that we're doing across categories. And I think one of the big things that Mike and Robert highlighted is again it's important to understand as we talk about suites, we're not talking about extended cabinet space, we're talking about how we display the appliances together in the appliance department and putting together the appliance, the range, the dishwasher, the microwave into a set, where they're actually showcased together versus being spread across the appliance department, which makes it easier for the customer to visualize that set in their home.

Your next question comes from the line of Jaime Katz with Morningstar.

Can you guys just clarify the $3.8 billion of share repurchases? Is that with the debt issuance? Or could there be some incremental repurchases with additional leverage?

So the -- we do plan to issue incremental debt during the course of the year as we manage to the 2.25x target. So our outlook goes to contemplate managing up to that target relative to the 2.11 we finished the first quarter to achieve $3.8 billion. That was our guided target. We'll continue to assess that as the year progresses, but that's where we sit today.

Okay. And then I know that it was commented that flooring was slightly below average. But I'm curious if you guys saw any benefit from the brand equity at Lumber Liquidators falling a little bit. Was there any sort of traffic uptick in the category that you guys saw as negative publicity surrounded sort of your peer?

I don't want to talk to a competitor. What I would say is that our flooring business performed very well. And when we look at the categories under flooring, we did see strength in laminate. We saw good performance in tile. And there was a little bit of pressure that we saw in carpet. And we're always sensitive to watching carpet because we have a very strong carpet offering, in particular with our STAINMASTER, which is an exclusive brand.

Okay. And then lastly, with inventory turns, they were able to tick up despite West Coast port issues. Do you guys have any thoughts on where you think that metric could go maybe closer to the end of the year?

Yes. So we're targeting roughly similar growth that we saw in Q1, 15 to 20 basis points improvement for the year in inventory turn improvement.

Our final question will come from the line of Budd Bugatch with Raymond James.

I guess, I'm still confused a little bit about the merchandising performance because I don't ever remember seeing it so lopsided with above-average and below-average categories. And maybe you can just shed me a little bit of light because I know we had strong performance, I think we'll call it that, in all 3 of the above-average areas. Is there any reason to be concerned about that performance and help us maybe understand that?

Yes, I can talk to that, Budd. The appliances, outdoor power -- it's a simple math. The appliances, outdoor power equipment and seasonal living are up extremely strong compared to the -- where the average is. And we looked at this a couple of times as well. If the appliances, outdoor power equipment and seasonal living weren't in strong, strong double digit like we have, then the spread wouldn't be as broad as it is. When we go through each of the divisional performances and we look at which ones fell just below the average as a result of the strength that we saw in the above-average, as I said earlier, tools and hardware, flooring, kitchens and millwork did extremely well, extremely, extremely well. And then where we saw real pressure was in paint and lumber and building materials specifically. So I wouldn't be worried about the spread. I think for us, the bigger question was could we take in this much of the appliance business and outdoor power equipment business and still manage to a flat gross margin? And we're very comfortable that we're able to take in that much market share and hold gross margin about flat.

Okay, all right. That's helpful. Also I heard that LowesForPros is doing well, but I'm not sure I heard anything about the Pro penetration or what -- if you made -- if you quantified any of that any way towards sales or how do we look at that.

Yes, Budd, this is Rick. We continue to be very pleased with our performance in Pro, as Pro has continued to respond to our value statement, our 5 Ways to Save, as we continue to get the great brands into our stores and continue to get those areas working for us, we still see great performance. When you look at Pro, it was in line with the company from a total sales perspective. We still see solid growth in applications for credit, which to me is a leading indicator of the strength of the category and what we're doing. So we still saw solid growth from that. As well as when you look at both ticket ranges as well as comps by ticket size, the Pro categories grew at positive performance across all ticket sizes and all ticket ranges. So we continue to be very pleased with the performance of Pro, especially as they continue to respond to our initiatives and our brand offering. But overall, it was still in line with the company performance.

And Rick, the penetration then as a percentage of sales? I think you quantified it last quarter.

Stays the same at 30%.

Yes, right at 30%, Budd.

30%, still at 30%. Okay, that was what I was trying to get to. And Bob, inflation, deflation, I'm not sure I heard that quantified on the comp.

Negligible, Budd. It had about 10 basis points of negative impact.

And as always, thanks for your continued interest in Lowe's. We look forward to speaking with you again when we report our second quarter results on Wednesday, August 19. Have a great day.

Ladies and gentlemen, this does conclude today's conference. Thank you, all, for joining. You may now disconnect.