Welcome to the O'Reilly Automotive, Inc. First Quarter Earnings Conference Call. My name is Christine, and I will be your operator for today's call. [Operator Instructions] Please note that this conference is being recorded. Following the company's prepared comments, we will conduct a 30-minute question-and-answer session. I will now turn the call over to Mr. Tom McFall. You may begin.

Thank you, Christine. Good morning, everyone, and welcome to our conference call. Before I introduce Greg Henslee, our CEO, we have a brief statement. The company claims the protection of the Safe Harbor for forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify these statements by forward-looking words such as expect, believe, anticipate, should, plan, intend, estimate, project, will or similar words. In addition, statements contained within the earnings release and on this conference call that are not historical facts are forward-looking statements, such as statements discussing, among other things, expected growth, store development, integration and expansion strategy, business strategies, future revenues and future performance. These forward-looking statements are based on estimates, projections, beliefs and assumptions and are not guarantees of future events and results. Such statements are subject to risks, uncertainties and assumptions, including, but not limited to, competition, product demand, the market for auto parts, economy in general, inflation, consumer debt levels, governmental regulations, the company's increased debt levels, credit ratings on public debt, the company's ability to hire and retain qualified employees, risks associated with the performance of acquired businesses, weather, terrorist activities, war and the threat of war. Actual results may materially differ from anticipated results described or implied in these forward-looking statements. Please refer to the Risk Factors section of the Annual Report on Form 10-K for the year ended December 31, 2013, for additional factors that could materially affect the company's financial performance. These forward-looking statements speak only as of the date they were made, and the company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. At this time, I'd like to introduce Greg Henslee.

Thanks, Tom. And good morning, everyone, and welcome to the O'Reilly Auto Parts first quarter conference call. Participating on the call with me this morning is, of course, Tom McFall, our Chief Financial Officer; and Jeff Shaw, our Executive Vice President of Store Operations and Sales. David O'Reilly, our Executive Chairman, is also present. I would like to begin our call today by congratulating Team O'Reilly on another record breaking quarter. Our team's relentless commitment to providing consistent, excellent customer service continues to drive our record-breaking results. I would like to take this opportunity to thank each of our team members for their hard work and dedication to our company's long-term success. Our sales results for the first quarter exceeded our expectations as we were able to capitalize on the strong demand generated from the harsh winter weather conditions in many of our markets. Our robust 6.3% comparable store sales increase was above the top end of our 4% to 6% guidance range, and is a testament to our team's commitment to providing unsurpassed levels of customer service. The 6.3% increase was on top of a 0.6% increase during the prior year. But I would like to remind everyone that on an even calendar basis, the first quarter of 2013 would have been 150 basis points higher after adjusting for the headwinds from the Easter calendar shift and the comparison to the extra Leap Day in 2012. We estimate that our first quarter of 2014 benefited approximately 20 basis points from the impact of the Easter shift back into the second quarter this year, which was inherent in our guidance. Total sales for the first quarter increased 9% to $1.7 billion, and we were especially proud of our team's ability to robustly grow our top line while also increasing our…

Thanks, Greg, and good morning, everyone. I too would like to begin today by thanking Team O'Reilly for our outstanding first quarter results. As I've said many times in the past, consistent, top-notch customer service is the key to our long-term success. And our team members have once again proven that dedication to helping every customer who calls or walks in our stores yields strong top line results, as well as profitable growth. Our team's high level of dedication was more apparent than ever this past quarter as our Team Members battled the elements to keep our stores open and take care of our customers. As Greg mentioned earlier, the extreme winter weather we experienced drove very strong demand for our products. But without our Team Members' efforts to keep our stores open and being there for our customers, we wouldn't have been able to capitalize on this strong demand. To put it in perspective, the winter conditions forced us to close 247 stores for some portion of a day during the quarter. This only represents an insignificant 0.1% of our store days for the quarter. What isn't insignificant is the lasting goodwill earned from customers when you're the only parts store in town open to take care of their needs. The harsh weather also forced 2 of our DCs to cancel some nightly deliveries. But because of the robust tier distribution network we built over the years and the hard work and dedication of our DC teams, we were able to provide all of our stores with the access to the inventory needed to take care of our customers. I can't say enough about how proud we are of the way our team pulled together to overcome adversity and satisfy our customers' needs. As much as I'd like to…

Thanks, Jeff. I'd like to start today by thanking Team O'Reilly for a continued dedication to providing excellent customer service. Your hard work generated outstanding results in the first quarter and heads us off to a strong start for 2014. Now, we'll take a closer look at our results and provide updates to our guidance. Comparable store sales for the first quarter increased 6.3%, which exceeded our guidance of 4% to 6%, and was driven by our continued solid business trends and the harsh winter weather, as Greg discussed earlier. For the quarter, sales increased $143 million, comprised of a $99 million increase in comp store sales, a $46 million increase in non-comp store sales, a $1 million decrease in non-comp, non-store sales and a $1 million decrease from closed stores. This strong sales performance, combined with our relentless focus on expense control, resulted in 18% increase in diluted earnings per share to $1.61, which exceeded the top end of our first quarter guidance range by $0.04. I'd like to spend a little bit of time now providing some detail on the LIFO impact in the first quarter. As we discussed on our last 2 calls, our success at reducing our acquisition cost over time has exhausted our LIFO reserve, with the result that additional cost decreases create onetime, noncash headwinds to our gross margin as we adjust our existing inventory on hand to the lower cost. We experienced a headwind of $23 million related to this item in the first quarter, which is higher than our expectations from our fourth quarter call due to better than planned cost decreases. However, this higher than expected LIFO headwind was offset by a mix benefit, resulting in a gross margin of 50.8%, which was within our range of expectations. We do not…

[Operator Instructions] Our first question is from Scot Ciccarelli of RBC.

A question on the gross margin. Given Tom's commentary on the LIFO impact, it looks like gross margin was increased by about 170 basis points year-over-year. And I guess what I'm trying to figure out is, how much of that is just from the lower procurement costs that we've been discussing, and then how much of that was from mix? In other words, kind of what's sustainable and what might be more temporary just because of mix impact?

Tom, you want to take that?

Yes. I think if you look at our guidance for the remainder of the year, you can calculate what we think the run rate is. The bigger piece was obviously, LIFO, but we did see a benefit from the winter mix of products that we sold.

To be fair, you guys tend be a little be conservative in your gross margin outlook. So, I guess, again, just looking at the increase that we saw, would you call a kind of a 50/50 split between mix and kind of procurement cost?

I think if you push the math, you'll find that it's a bigger procurement, and mix is more an offset to the higher than expected LIFO number. But we're comfortable with our guidance for the remainder of the year, and gross margin is an item that is influenced by a lot of external factors. So we think that the -- given the current business situation, the margin range we've given is appropriate.

Our next question is from Matthew Fassler of Goldman Sachs.

My first question relates to the buyback. Totally hear you on the leverage target and on the long-term goals. This quarter did mark a bit of a change in cadence from the time that you had started the buyback in earnest. I just want to understand the factors that influenced the timing of buybacks, and whether this quarter represents any sort of directional change in terms of the velocity with which you expect to be in the market.

Yes. Well it certainly doesn't indicate any directional change. As Tom said in his prepared comments, we're -- we first look for opportunities to invest in our business and then we're -- from a long-term perspective, going to continue to buy back shares as is appropriate, but nothing has changed. And, Tom, I don't know if you have any additional comments on that.

I definitely agree with that comment from a long-term perspective. On the short-term basis, we have a very short open window because of the year-end close time to adjust our grids. And I think that, that's also a factor in the amount of shares that we bought this quarter.

Got it. And then just a quick follow-up. For the past several quarters, I think the industry has been battling fading inflation, to put it mildly, if not, perhaps, a little bit of deflation. At least one of your competitors talked about some stabilization in terms of material drivers of pricing. Just curious, as you think forward over the next year or 2 and contrast it with the environment that you've had for the past few quarters, do you see any change in direction there?

I would say that as an industry is -- raw materials continue to increase in price, at least some of them, oils and resins and things like that, that we will start to see more of an inflationary cycle again. But right now, we're not seeing much of that, but we would expect to some in the future. Tom, I don't know if you have any addition?

Our guidance is -- for the remainder of the year is based on continuing to see below historical average rates and inflation.

Our next question is from Dan Wewer of Raymond James. Daniel R. Wewer - Raymond James & Associates, Inc., Research Division: Greg, I have one long-term question, one short-term question. First, long-term, gross margin rate for O'Reilly is up 900 basis points over the last decade. And your competitors have achieved similar improvements. If you were to go back and read the company's forecast, say, from a few years ago, you were indicating minimal margin improvements ahead due to the growing sales contribution from commercial. And now, in hindsight, that, clearly, was extremely conservative. What do you think that we've got wrong on this margin expansion thing? Why is it so much more robust than what we were expecting a couple of years ago? Is it procurement cost that Tom was alluding to a second ago or?

Well, I think it's the combination of 2 things. I think it's procurement cost. I think it's the fact that as our company has grown and some of our larger competitors have grown, we've been able to take more advantage of some of the import products that we can bring across the sea in large containers and take advantage of supply-chain efficiencies, which help improve our gross margin. It's also just rational pricing in the marketplace. I think that most of the players in the industry realize that our business is a service business and that it's hard to win repeat customers, especially on the professional side of the business, with price that is a result of great service. So I think that as an industry, we've been very rationally priced. And I think that's been maybe a little bit more of a tailwind than we would've foreseen a few years ago. Daniel R. Wewer - Raymond James & Associates, Inc., Research Division: When you think out the next 3 years, would you expect margin to continue increasing, knowing that your commercial mix is going to further increase?

I would certainly not expect the kind of increases we've had over the past few years. We've got a great team of people here that work every day on making sure that we're priced competitive on the street, and making sure we do all we can to maximize our gross margin, maintain our customer service levels. But I think we've gotten to a point where there's just not much -- there's really no low-hanging fruit left, and we're working to maintain and incrementally grow our gross margin at a slow rate. But I certainly would not expect the kind of improvements that we've seen over the past few years. Daniel R. Wewer - Raymond James & Associates, Inc., Research Division: Yes, well, you -- I think you all said the same thing in 2011. My other question more short-term, you talked about the weather benefits, and you talked about the -- this continuing through the second quarter as the under car damage begins to benefit sales. Does this exhaust itself at the end of the second quarter or are you thinking that the deferred maintenance and repairs over the last 2 years has built up so much that this is going to spark good sales during the second half of the year as well?

Yes. I think part of this depends on the condition of our customers economically. A lot of the things that are damaged in harsh weather like we had in the winter are failures that you have to fix immediately. If your battery is shot or you starter alternator doesn't work, if you want to drive your car, you've got to fix it right away. If your axle shaft CD joint starts making noise because it's been through some abuse, so maybe the boot got torn and it's leaked grease out of it, you can drive it making noise for quite some period of time. And so I would say that some people, if they're in good shape economically, will get their car fixed as soon as they start hearing the racket. Other customers will drive it through the summer, maybe even in the winter, before -- and then not fix it until it actually has to be fixed. So these harsh conditions are generally good for our industry, both short-term and longer-term. And when I say harsh conditions, I mean, weather extremes in the winter and weather extremes in the summer. What would be ideal for us is on the tail of this really harsh winter, is to have a blistering hot summer, driving cooling system and air conditioning and all the other type failures you can have, in addition to more battery business. And the battery business has been good, I think, for the whole industry, this winter. And your batteries get really damaged in the extreme heat. And many times, you see the failure in the winter. So a real hot summer this summer would be helpful for that also.

Our next question is from Gary Balter of Crédit Suisse. Gary Balter - Crédit Suisse AG, Research Division: Just a couple questions. California's been more in a drought, like they're almost the opposite of what's going on in the other markets. Right now, has that had an impact? Is that one of your weaker markets at the current time?

It -- to some degree it is Gary. The categories like wiper blades and stuff like that in California have not been as strong as they have been, especially on the DIY side out there, our DIY business out there. Because a lot of the kind of things that you sell to the DIY customers are things like wiper blades and stuff like that, that are directly heat-related. I mean, it has been a little bit of a drag on our business in the West Coast. Gary Balter - Crédit Suisse AG, Research Division: So how much -- could you -- do you want to quantify the drag or...

I'd rather not if that's okay. Gary Balter - Crédit Suisse AG, Research Division: I just thought I'd ask.

We try to stay away from as much regional information as we can just from a competitive standpoint. Gary Balter - Crédit Suisse AG, Research Division: Well, my second question is also regional. You mentioned Florida and your expansion already in the distribution center. What's the size -- like what's the potential in that market? How many stores are you looking at?

It's yet to be determined, but we could potentially have somewhere in the area of 300 stores in Florida. So far, our new store startups in Florida have done incredibly well. And we're very encouraged by our performance down there. And if you asked us 2 years ago, how we thought we would start in Florida, we would've undershot how we've actually performed. So I think we're a little -- we're more optimistic now than ever about our ability to be successful in Florida. Gary Balter - Crédit Suisse AG, Research Division: And you haven't -- where are you down to in Florida?

We're down south of Tampa now. Our DC is in Lakeland. They're between Tampa and Orlando, and we're south of Tampa now. Gary Balter - Crédit Suisse AG, Research Division: Okay. And then you're working your way all the way down to like Miami and the Keys?

Yes, we're looking at properties now in the northern -- north side of Miami. We're not down in Miami, but we're looking at properties at the north side of Miami.

Our next question is from Alan Rifkin of Barclays.

Greg, the DC openings slated for all of 2014, the 3 of them, really marked the most concentrated efforts since the very early days after the CSK acquisition when you were opening up DCs to support those 1,300 stores back then. Would it be reasonable to expect that the drag on margins from these 3 DCs would be similar in duration as to what we saw back in the early days following CSK?

There are some differences. When we opened the CSK DCs, we had a lot of underperforming stores that we immediately kind of rolled into those distribution centers. In this case, we have a -- we opened a DC that took stores from a distribution center that was way over its max to generate the best efficiency it can generate there in Atlanta. Our Chicago DC is kind of the same thing. We'll put several stores on it as quick as we can once it opens to relieve some of the stores that we have overcapacity state there in Indianapolis and in Minneapolis. And then in Devens, of course, it's to fund our expansion in the Northeast. And the 56 stores that we bought as part of VIP will immediately start being serviced by that DC due to closure of our Lewiston DC. So it's similar, but it's different some ways. Our distribution team does a fantastic job of ramping our -- the cost that we can control through payroll and productivity, up to match the number of stores that we service. So we would not expect a noticeable hit to our gross margin as a result of these openings. And Tom wants to add something to that.

Two items I would add to that. When we look at the CSK transition, those stores were going from the 1 night a week delivery to 5. These stores are already on 5 night a week delivery, so we have a freight savings because of proximity. And the other item that I would add is, from a proportion basis, this is 3 into a bigger portion. So the impact will be less dilutive. So we are expecting a real meaningful impact on our gross margin.

Okay. That makes a lot of sense. And one follow-up, if I may. Greg, the number of categories that you mentioned that should benefit going forward from the harsh winter, that of the undercarriage, the chassis and the steering suspension, things like, collectively, approximately, what percent of your revenues do those categories represent?

Well, it depends on what you, of course, include and the things that would be affected. There are a lot of things affected by harsh weather, including electrical units, starters and alternators, batteries, driveline, ride controls, steering, suspension, all that. Those are the kind of the core part of our car parts business absent the things that would be in place to service drive ability issues like emission, ignition, fuel, things like that. So I really don't have a percentage. It would be -- it's -- at least, if you include brakes, it would be more than half of our hard parts categories for sure.

Our next question is from Chris Horvers of JPMorgan. Christopher Horvers - JP Morgan Chase & Co, Research Division: If I recall last year, I think April, really starting to rebound for the industry, with categories like brakes starting to come back. Industry-wide, obviously, you guys are doing a lot better. So it seemed like the comp stacks that you were referring to are actually accelerating here in April on average. So just curious how your brake business is doing as we start to lap the step-up. And is it a fair comment to say that the stacks have accelerated in April? And is the outlook more prudent or is there something else that's providing you with caution?

The way we stack in our comparison from the quarter we're in to 2013 is that April would be a slightly stronger comparison than June. We kind of -- business last year in the second quarter kind of ramped down a little bit. Yes, brakes are doing good. This time of year, brakes generally do well from a comparison standpoint. We're happy with our brake performance as it exists today. How we do through the rest of the quarter is yet to be seen, but we would expect our brake business to be good through the second quarter.

Chris, this is Tom. What I would remind everyone is that when we talk about the strength of our business, we look at a dollar performance per week. And we look at those dollars and do the math to see what comp they generate. So we've given the 2% to 4% guidance because we have tough comparisons, and with that said, we're still performing, on a total dollar basis, strong as we have been. But that flushes out our comp range. Christopher Horvers - JP Morgan Chase & Co, Research Division: So you're saying that if you sort of -- whatever you're doing on a per weekly basis, year-to-year, and you project that out, that would put you into a 2% to 4% for the quarter?

Would put us into the range that we've given, yes. Christopher Horvers - JP Morgan Chase & Co, Research Division: Okay. That's in spite of the comparisons being a little easier in May and June?

Like Tom said, we do kind of a -- we do a plan, a weekly plan for the whole year. And our weekly plan, based on the comparisons that we have for the second quarter, would yield what we think would be somewhere in the area of a 2% to 4% comp for the second quarter. Now what's unknown about this is the real affect that the harsh winter we had will have during the second quarter. It's hard to know. There are a lot of factors, it's the harshest winter we've had in a long time. Gas prices are up a little bit. Employment's -- unemployment's improving a little bit. So it's yet to be seen, but we feel good about the business yet. We felt it would be imprudent for us to make our 2-year stack acceleration greater than we did with the guidance we gave at 2% to 4%. Christopher Horvers - JP Morgan Chase & Co, Research Division: Totally understand. And then longer-term, Greg, the great debate out here is average age or, I think more importantly, the SAAR cliff as you look to '15 and lapping that '09 class of 10 million vehicles sold in the trough of the cycle. So just curious if -- give you the opportunity to talk about how you think about facing that SAAR cliff and the cars going into that 6-year-old class versus cars exiting that 10- to 11-year-old class, which is the sort of end of the proverbial historical peak repair years.

Sure. Well, I mean I've read a lot of the information that many of the analysts have written about this, and we do a lot of analysis inside our industry also. Some of our suppliers and so forth do a lot of work on this. There's no question that the data is what it is relative to the 6- to 12-year-old vehicles, the total count of those vehicles decreasing in the coming years as a result of the lower car sales back in '10 and during the recession and so forth. The unknown factor and kind of the comments that I've made in the past have been that we feel like that the way cars have been built for many years now, even back into the '90s, but for sure, in the 2000, that they're just going to stay on the road longer. They've -- and they're more drivable at higher mileages. I had lunch with one of our good customers yesterday, and we were talking about this very subject. And he works on cars every day. And he knows nothing about vehicle population and the SAAR cliff and all those kind of stuff, he's just out there trying to make sure he keeps all of his techs busy and drives his business every day. And he made the comment, he said, it's amazing how many miles cars have on them today and people are still willing to invest big money in keeping them on the road because the engines and transmissions and interiors and the bodies and all those things still are in good condition. At 200,000-plus like -- it sounds crazy to say this, but there are cars being driven that look pretty darn good going down the road to have over 300,000 miles on. And the engine's transmissions are still functioning properly. So I think that those that feel that this SAAR cliff is going to hurt demand significantly are discounting the fact that these vehicles that are past 12 years old are still on the road and still being maintained. And unless we see a decrease in the vehicle population in general, which would not be expected, that this is going to have a minimal impact on our industry.

Our next question is from Michael Lasser of UBS.

As you look out over the intermediate term, Greg, what are the chances that all of these harsh conditions in this cold weather has simply pulled forward demand where the vehicle population has seen upgrade to some of its hard parts, all of the parts that you mentioned, and now, there won't be a need to replace some of those items for a period of time?

Well, I mean, Michael, there's always -- when a, let's say, a steering part, a tie rod end, or a control arm or anyhow you got centerlink or a suspension part like a control arm or a ball joint or something like that, that fails because of potholes and bad weather, it was going to fail at some point. It was a matter of time. Some of the things that happen relative to subzero temperatures that drives belt failure, stuff like that, that belt may last a long time being driven in a perfect temperature for its whole life, but extremes drive demand. But in some cases, it creates demand earlier than the car typically would've failed. Sometimes it's just demand that was going to happen at that point in time anyway. So it's really hard to speculate on that, Michael. We -- I feel like we, as an industry, we started talking about weather a lot the last couple of years when for most of my career, we just didn't talk about weather. I remember back when Dave was the CEO, we never talked about weather. And he kind of made it his policy that the weather's the weather and we really can't do much about it so we're going to just sell as many parts as we can. And really, that's kind of what we do today. Our operations guys, they don't look at weather forecast to staff stores unless it's a major storm that shuts everything down and stuff like that. So demand for auto parts is really driven by miles driven, specifically in cars that are out of warranty. And sure, you can pull demand a little bit forward in real harsh conditions but it eventually comes around.

Okay. My second question is on the AP to inventory ratio. There's precedent in the industry that showed that it can go north of 100% impact, in fact it can go north of 110%. Are there any structural factors that are unique to O'Reilly that would prevent it from reaching the level -- the best-in-class level of the peer group?

Yes. That factor is that we carry several lines of products that are products preferred by the professional customers. And that mix of business is not going to allow us to get to where some of our competitors are simply because these -- the vendors that carry these products are less likely to give us the terms that we would ideally want without offering them to everyone in the industry, more the traditional side of the aftermarket, to which they're -- to whom they're not offering these terms. And for that reason, we're going to be a little more limited than what some of our more retail-based competitors are.

And have you been surprised at how good the terms you've gotten already have been?

No, we fully expected what we got. And so we're happy with where we've gotten to, but, no, I -- and we're not -- I mean, we're not surprised, we worked hard to get it. We know exactly how it happened. And our factoring program, being what it is, has helped our vendors be in a position to where they couldn't give us the terms that they've given us. But we're getting to a point that it's going to be hard to grow it a lot past where we're at today.

Mike, this is Tom. I think the one thing that has surprised us is since January of 2011, we went to an unsecured structure and could offer this vendor financing program, the rate at which we got to a number that we thought we could get to has been a little surprising. The total isn't surprising, we just thought it would take longer.

Our next question is from Daniel Hofkin of William Blair & Company. Daniel Hofkin - William Blair & Company L.L.C., Research Division: The -- I just wanted to, at the risk of beating the guidance topic to death, just to maybe finish encapsulating it. Is it fair to say that you guys basically set your guidance, in this case, really before the winter weather was in effect, including for the second quarter? And so while maybe you did see some weather benefit thus far in the quarter, your guidance for the remainder of the quarter does not explicitly incorporate an ongoing weather benefit? And so if you saw that, it could theoretically be additive?

We talked about this last week and decided for sure what our guidance was going to be. So it wasn't something that was preplanned as part of our 2014 planning. Our -- if you take Easter out of the equation, because Easter leveled out with Easter being in the first quarter in 2013 and being in the second quarter of 2014, and you just look at the adjustment for Leap Day, which you have to make, our first quarter 2-year stack is 8.2% and the midpoint of our guidance for the second quarter, our 2-year stack is 9.5%. So we feel like that's reasonable guidance. What happens in the next 2 months as we work to the second quarter is yet to be seen. We have every reason to think that business will continue to be good, but we have tough compares. So we'll see. But yes, to answer your question specifically, this was not guidance that was planned early or before the end of last year, it's guidance that we talked about recently. Daniel Hofkin - William Blair & Company L.L.C., Research Division: Okay. So there's some assumption implicit in there perhaps about weather. It's not -- it wasn't set 6 months ago, it's kind of recently updated?

We talked about it last week. Daniel Hofkin - William Blair & Company L.L.C., Research Division: Okay. The other question, I guess, just back to kind of the relatively more balanced performance between professional and DIY in the last several quarters. How much more opportunity do you think there is to sort of up your game as it seems like you have on the DIY side of the business through whether it's more parts availability in the store, higher in-stocks, some of the customer service and POS initiatives? How much more room is there to go on that?

Well, I think there's always a lot of opportunity there. The DIY business is a -- they come in our store because we have professional parts people in our store, we have great inventory and we give great service. And some of the things that we do today that we didn't do 2 or 3 years ago or 4 years ago relative to helping customers with diagnostics when their check engine light's on, install wiper blades or battery or things like that, are things that they kind of ramp, word gets around. We're not big advertisers of those kinds of things just with respect to our professional customers. So these are things that build over time. Word-of-mouth helps drive DIY customers into our stores for those types of services. So we would expect to continue to see benefit from great customer service for a long time to come because we consider all these things just kind of rolled up into the level of service that we try to offer and make sure that the level of service we offer exceeds that of most of our competitors. So we would expect to continue to see benefit from the things that we do for some period of time. And every -- there's not a month that goes by that we don't consider things we can do to improve that through our point-of-sale system, our electronic catalog; things we're doing with our website, mobile e-commerce; things that we feel like will help tie our customers more directly to us, our rewards program, which now has 5.5 million customers enrolled, and just all those things.

Our next question is from Mike Baker of Deutsche Bank.

I wanted to ask you about the West Coast stores. Can you give us some senses as where those former CSK stores are in terms of their mix DIY versus DIFM, and where they ultimately can get to? And then if you could put that together, total company, what's the percent of DIFM now versus DIY?

We're looking here, just a second. Do you have the numbers, Tom?

We're -- end CFK we're about 35% professional business. Total company is around 46%. As we talked about in the past, new stores bring on the DIY business faster than the do-it-for-me.

Okay. So that 35% at CSK, I mean, I think you said in the past that, that probably won't get to the 50/50 that the legacy O'Reilly stores did. Is that still the right way to think about it? And ultimately, where can it get to? Is 40-60 the right kind of range or could be higher than that?

Let me go back for a second to correct one number. Consolidated professional is 42%.

Okay. And so what can CFK ultimately get to?

I'll turn that one over to...

I'm sorry, what was the -- we were -- I was looking through the numbers here.

So CSK at 35% commercial. I think you said in the past that it likely won't get to the 50/50 that legacy O'Reilly stores were, or at least that's what you said when you made the acquisition. But I'm wondering if that's changed or the thought process there. Really, the simple question is, what can the percent of DIFM ultimately get to in the CSK stores?

We can get it to above the -- about to the range the whole company is right now, I think, is about where you would get to with those CSK stores, the 42% commercial, somewhere in that area. And that's strictly an estimate based on our knowledge of the stores that we have that are in more retail areas that don't have a lot of professional business around them. I think because of that, we'll have a hard time getting to the position that the core O'Reillys or the historical O'Reilly stores are or were prior to buying CSK. But that changes over time as we -- leases come due and we make relocations and things like that. But based on the state of our locations today, I would say somewhere in that 40% or low 40% range would be our commercial penetration out there.

And did some of the consolidation in the space impact that at all?

It can. As acquisitions happen, that could certainly have some impact. Probably the bigger impact will be just the decisions we make as far as potential relocations of stores that might be in locations that are not conducive to the professional business as leases come due.

We have reached our allotted time for questions. I will now turn the call back over to Greg Henslee.

Thanks, Christine. We would like to conclude our call today by, again, thanking our -- the entire O'Reilly Team. And you've, once again, proven that hard work and excellent customer service are the keys to our long-term profitable growth. We're very proud of our excellent start to 2014, and we're very confident in our ability to build upon our first quarter accomplishments and continue to gain share across all our markets. I would like to thank, everyone, for joining our call today, and we look forward to reporting our second quarter 2014 results in July. Thank you.

Thank you, ladies and gentlemen, this concludes today's conference. Thank you for participating. You may now disconnect.