Good day and welcome to fiscal 2012 Signet results conference call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Mr. Tim Jackson. Please go ahead, sir.

Thank you, Operator. Good morning and welcome to the conference call for Signet’s fiscal 2012 results. I am Tim Jackson, Investor Relations Director. With me are Mike Barnes, CEO and Ron Ristau, CFO. The presentation deck we will be talking to is available from webcast section of the Company’s website, www.signetjewelers.com. I will now give the Safe Harbor statement. During today’s presentation, we will in places discuss Signet’s business outlook and make certain forward-looking statements. Any statements that are not historical facts are subject to a number of risks and uncertainties and actual results may differ materially. We urge you to read the risk factors cautionary language and other disclosure in the annual report on Form 10-K that will be filed with the SEC on today, March 22, 2012. We also draw your attention to this slide. I will now hand over to Mike.

Thanks Tim, and good morning to you all. I’ll begin with the highlights of our excellent fiscal 2012 results. Same store sales were up 9%. The U.S., which represents about 80.9% of our sales, delivered same store sales results of 11.1%, which was outstanding after an increase of 8.9% last year. In the U.K., we’re pleased with the return to positive same store sales for the year in a very challenging environment. Income before income taxes was $502.1 million, an increase of 67.1%. After a tax grade of 35.4%, this gave diluted earnings per share of $3.73, up from $2.32 last year, an increase of 60.8%. I’d like to thank all the team members at Signet for their contribution to these great results. As most of you know, the Board approved two forms of shareholder distribution during fiscal 2012. First, a $0.10 per share quarterly dividend was initiated and we’re very pleased to announce today that the Board has now approved an increase in the quarterly dividend to $0.12, representing a 20% increase. Second, the Board authorized a $300 million share repurchase program effective from January 16, 2012. By January 28, we had already executed $11.8 million under the program, which continues to remain in effect. Now looking at the U.S. performance in a little bit more detail – U.S. total sales were $3.341 billion, up $289.9 million which was an increase of 10.6%. Kay increased same store sales by 11.8% in fiscal 2012, an acceleration from the 7% growth achieved in fiscal 2011. Jared had another outstanding year with comps up 12.1% for the year following an increase of 15.7% last year. Overall, U.S. same store sales increased by 11.1% in fiscal 2012 compared to 8.9% last year. Operating income was $478 million, and that was up $135.3 million…

Thank you, Mike. As Mike stated, total sales for Signet increased 9.1% to $3.7492 billion compared to $3.4374 billion last year. Total company comparable store sales increased 9% versus an increase of 6.7% last year. In the U.S., total sales increased by 10.6% to $3.341 billion, primarily reflecting a comparable store sales increase of 11.1% versus an 8.9% increase last year. In the U.K., total sales increased by 3.2% to 715.1 million, reflecting a comparable store sales increase of 0.9% compared to a decline of 1.4% last year, and the favorable impact of currency fluctuations which more than balanced the 1% adverse impact of reduced space. In total, ecommerce sales were 92.3 million, up 24.7 million or 36.5% in the year. Now looking at the reconciliation of income, income before taxes increased by 201.7 million to 502.1 million, up 67.1%. I’ll now explain the major factors driving this increase. Gross margin was 1.4376 billion, an improvement of 194.7 million. The gross margin rate was 38.3%, up 210 basis points. Key drivers of this improvement were as follows. The main driver was leverage on store occupancy expenses, both in the U.S. and the U.K. We experienced improvement in the U.S. net bad debt to total sales ratio, which came in at 3.4% of U.S., down from 4.2% last year. There was also improvement in inventory-related costs. These items offset a slight decline in gross merchandise margin which was down 10 basis points, with the U.S. being up 10 basis points and the U.K. down 60 basis points. Gross merchandise margin was little changed despite record increases in commodity costs. Selling, general and administrative expense was 1.567 billion for fiscal 2012, up 76.3 million or 7.8% from last year. As a percentage of sales they were 28.2%, which is 30 basis points…

Thanks, Ron. We would now be pleased to take any questions that you have at this time.

Thank you. If you would like to ask a question at this time, please press the star key followed by the digit one on your telephone. Please ensure that the mute function of your telephone is switched off to allow your signal to reach our equipment. If you find your question has already been answered, you may remove yourself from the queue by pressing star, two. Again, please press star, one to ask a question. We will now take our first question from Ike Boruchow from JP Morgan. Please go ahead, sir. Ike Boruchow – JP Morgan: Hi guys, good morning. I guess just a couple questions. First question on the current trading statement you gave us. Since you gave us the EPS range, Ron, can you help us—how should we think about gross margins and SG&A balancing out for Q1? And then also, could you guys help us understand just how important Valentine’s Day is, what percent of sales for the quarter Valentine’s Day represents, especially in the U.S.?

Well, I would say that we’ve given the guidance ranges. You know, we’re not getting into extensive detail. We believe that, like we said, our gross margin ratio will be broadly similar to that of last year and that our SG&A will be similar. It fluctuates somewhat by quarter but those broad statements, I would think, still hold in the first quarter as well.

And as far as the importance of Valentine’s Day, obviously it’s one of the most important holidays that we have during the year, and it’s a very strong selling season for us so it’s a very important part of the quarter. I don’t think we break out the exact percentage of what it usually means to us. It probably is important to note, though, that it’s much more important in the U.S. than it is in the U.K. as a holiday. Ike Boruchow – JP Morgan: Okay. And then I guess Mike, broadly speaking on the industry and commodity costs, can you help us think about the timing of when peak costs kind of flow through the P&L? Is that kind of happening right now in the first half, and kind of you guys’ strategies on how to help offset that with price increases and increasing the mix of higher margin products.

Well, I’ll let Ron talk about the flow of the costs and how that affects our average costing system. In terms of how we control it, we’re doing the same things that we’ve talked about in the past, and that is our plan is to broadly maintain our gross merchandise margins going forward. We feel that we can do that. As appropriate, we will increase prices to make that happen as well as we do see these costs flow through our system and increase in average costing. One of the great things is we’ve got an unbelievable product line-up. We’ve got great brands, great products, great designs, and because of that our customers are willing to accept the price increases as they have been over the years. It’s really been a competitive strength to us that we have such a strong line-up, we’re able to do that. Ron, do you want to talk a little bit about how the costs flow through?

Yeah. As you know, our costs flow through on average so that there is some time delay between commodity price increases and them being reflected in our margins. We will incur additional—we’re working on price increases in the first quarter. They will not have much impact in the first quarter, so I don’t really know what else to say about it other than for the year, we will price to more or less maintain our gross merchandise margins. There will be some fluctuations by quarter. Primarily, benefits usually come in the second and third quarter, and then by the fourth quarter they tend to be diminished somewhat as the costs begin to flow through, and you see this every year so that our margins tend to accelerate a little bit in the second and third and be a little bit lower in the fourth and first on gross merchandise margin. Ike Boruchow – JP Morgan: Great. Thanks guys.

We will now go to our next question from Bob Drbul of Barclays Bank. Please go ahead. Bob Drbul – Barclays: Hi guys. Good morning, good day. Two questions that I have for you – first one is on ASPs. Can you talk a little about the ASP trends from Q4 and Q1 and sort of your expectations around it and heading into ’12? And the other concern or question that I would have for you is are you seeing price resistance to any of the price increases, and do you sort of have a plan for any further price increases around the diamonds and the gold as the higher costs do work into the P&L?

Well on the first question for ASPs, I guess in Kay we saw slightly declining ASPs. A lot of that is because we were mostly non-comp with our bead program, Charmed Memories, last year; and so obviously as beads are counted one at a time and carry a lower average price point, you’re going to see the ASPs slightly decline. In Jared, the ASP went slightly the other direction as we have totally finished comping the bead program in that concept store – Jared – and so we’re seeing just more of a normalized increase in ASP over time, and especially as prices are increased to offset the commodity prices out there. I’m sorry, what was the second question you had?

Customer resistance.

Oh, customer resistance. As I said earlier, we have been able to price to broadly maintain our gross merchandise margins historically. We continue to anticipate that we’ll be able to do that; and again, the great line-up of products and brands that we have allow us to do that because it still presents a great value for our customers. Bob Drbul – Barclays: Great. Thank you very much.

We will now take our next question from Jennifer Davis of Lazard Capital Markets. Jennifer Davis – Lazard Capital Markets: Hey guys. Congratulations on a great 2011 and on your continued solid execution. I remember at the beginning of 2011 there were doubts about your ability to increase sales and gross margins on top of strong 2010 results and increasing commodity costs, so definitely a job well done. So I have a couple of questions. First, Mike, did you say how much bridal increased, and could you talk about margins on bridal versus the rest of the assortment? And then I was hoping you could elaborate a little more on the 5 to $7 million investment to drive future supply chain capabilities. I think you said you were establishing some permanent international capabilities. Just wondering if you could elaborate on that. Thanks.

Sure. On the—I’ll let Ron answer the question on the margins for bridal. Bridal, I don’t think we mentioned it in the call, but it continues to be about 50% of our jewelry merchandise sales and continues to be a very strong part of our business. As we did mention, we have focused very heavily on that and focused heavily on training our store staff to really drive that part of the business going forward. So we think there’s a great opportunity for us in that area. Margins on bridal—

Yeah, bridal margins are similar to perhaps, depending upon the mix, just a touch lower than the Company average. Don’t forget, there are a lot of—there are loose solitaire stones in our bridal mix, and that is a lower margin business for us. So the total bridal mix is broadly similar, perhaps a little bit less.

And as far as the supply chain initiatives, Jennifer, we’re moving in a very exciting direction. As the leader in the specialty jewelry industry in both the United States and in the U.K., supply chain is very important to us. So we continue to look at new initiatives that will help us secure our supply chain for the future growth of our company and allow us to supply the right products, the right prices, the right qualities of both diamond-related and other products to our customers. So we’re very focused on that. We really haven’t outlined exactly what those initiatives are. They are international in nature. They’re not really material, as we stated, in terms of investment. We expect up-front investments of 5 to $7 million to really get started there, but there are some exciting initiatives that we have planned that we think are going to really give us competitive strengths for the long-term future of our company. Jennifer Davis – Lazard Capital Markets: Okay, thanks. And then one quick clarification, if I may – on the Q&A, you guys both said that you were planning on maintaining, or broadly maintaining gross merchandise margins.

No, I said gross margin. Jennifer Davis – Lazard Capital Markets: Okay. All right.

Yeah, we said gross margin. I’m sorry. We were trying to get away from one little piece of the margin; so broadly speaking, gross margin. Jennifer Davis – Lazard Capital Markets: All right, thanks.

We will now take our next question from Bill Armstrong of CL King & Associates. Bill Armstrong – CL King & Associates: Good morning Mike and Ron. What are you seeing in terms of new retail center development in the U.S.?

We’re not seeing a lot of new retail development still. What we did is we appropriately challenged our team to go out and open more stores this year than they did last year, and really hunt for those spots that they hadn’t found yet and try to make it happen. Most of those, or a great majority of those, are going to be off-mall locations. We are finding the occasional mall location, but certainly we’re much more penetrated with Kay in the malls. So if you look at the new store openings that we’ve outlined for this year, there is 45 new stores and we’re thinking about approximately 11 of those will be Jared, so that will be off-mall location; and the other 34 would be Kay, but a significant number of those would also be off-mall as we found a lot of success opening Kay off-mall as well as Jared. In some areas because of the demographics, Kay is actually a better fit; so we’re taking it as they come. We wish there was more development out there. We look forward to the day, hopefully, when there will be because we would love to open more new locations with the success that we’re having with our stores right now. That would be our best hopes and wishes, but we’re taking it as we can and we’re being as aggressive as we can with the environment that’s delivered to us. Bill Armstrong – CL King & Associates : Okay, great. That’s helpful. Second question on your guidance, typically in the past your guidance has included same store sales and free cash flow, and I see that’s not included in your guidance currently. Would you care to share that with us, and if not, why the change?

First of all, we’ve never included same store sales in our outlook, so I would just have to correct that statement. From a free cash flow perspective, we’ve made the decision not to focus on free cash flow. We think that, number one, it’s not a standard measurement for most U.S. companies, and we also believe that that was a focus during the recessionary time frames and that at this point in time it’s not as important. We didn’t give a number, but I’ll tell you we expect the number to be position to $200 million, so it will be over $200 million. This year, our free cash flow came in at around $228 million, so rather than give these broad ranges we were giving, we just would like to—it’s kind of an incidental measurement, not a primary driver, so that’s why we did not provide it. But the range will be over $200 million. Bill Armstrong – CL King & Associates: Got it. Okay, thanks.

We will now take our next question from David Wu of the Telsey Advisory Group. David Wu – Telsey Advisory Group: Hi, good morning everyone. First question – with respect to your new merchandising initiatives that you have planned for this year, are you planning at all to develop any new exclusive brands, or is the focus really on introducing new styles within your existing differentiated ranges?

That’s a great question. We definitely are focused on creating new designs and styles with our existing, very successful ranges. That’s always important to us, and we’ve got some great new products coming out in those ranges. In addition to that, though, we’ve got some exciting tests going on. I’m not going to characterize them exactly for competitive reasons, but we’ve got potential line extensions and we’ve got some new brand tests going on as well, so there’s a lot of exciting things happening. In fact, we’re testing a lot of things in the spring that could very well be rolled out or begin starting a roll-out in the back half of the year.

Excellent. On the price increases this year, could you quantify the magnitude at least directionally if they will be higher or lower versus last year?

We don’t like to get into specifics on a level of price increase for competitive reasons. Suffice to say that we said that the price increases will be sufficient to cover the inflation in commodity costs that we are forced to deal with, but we’d like not to be more specific than that, David. David Wu – Telsey Advisory Group: Okay, that’s fine. And then also, can you give us a little bit more color on credit sales over the quarter? How have approval rates been trending, and are you still seeing improvement in the average customer credit score in the fourth quarter?

Well, I would say that you can see the penetration went up to over 56% versus 54% for the year. The fourth quarter was strong. We are seeing that our approval rates remain, I would still say, relatively consistent. The approval rates in and of themselves have not been changing dramatically. We have seen that people who have been granted credit are behaving very responsibly and continuing to make more than the minimum payment, and all of this is reflected in the overall performance of the portfolio and the improvement in bad debts that we’ve seen. So the credit portfolio is performing very well. There has been no real change in the level of approvals or disapprovals, or no change in our scoring mechanisms, and it just seems to all be working well. It’s very supportive, of course, of the bridal business and important as we deliver some of the higher priced merchandise, such as the Neil Lane and Tolkowsky lines, which are slightly higher prices; and our consumers are using some additional credit to help finance those purchases. So everything is working very, very well and supporting the business to our satisfaction. David Wu – Telsey Advisory Group: Perfect. Thank you very much.

We will now go to our next question from Rick Patel of Bank of America. Rick Patel – Bank of America: Can you help us understand the February comp decline in the U.K.? I’m just wondering if the consumer sentiment there is getting worse, or if there was a change in perhaps your promotional cadence. What exactly is driving that change in trend there?

Hi Rick. That’s a great question too. You know, if you look at the February comps in the U.K. and you look at them compared to last year, what you saw was lower single digit declines both last year and this year, so there’s a little bit of a trend there. A couple things that I would say about that – one is to reiterate that while it is important, Valentine’s Day is not as important in the U.K. as it is to U.S., and it doesn’t carry the same weighting on that. The other thing that I would say is I wouldn’t necessarily expect to see that exact same trend in either the first quarter or the full year for the U.K. It seems to be a little bit of a trend for February, but that’s a very short time frame.

And Rick, just to add to that, remember the comp last year in the U.K. was also a negative 2.6%. February just isn’t a very strong month over there. Rick Patel – Bank of America: Okay, got it. And can you also maybe give us an estimate of how many store closures we should expect this year; and taking into account your 45 new stores, what should we expect the net change in square footage to be like?

The square footage will be positive and I believe the closure number is approximately 25 stores. You know what, Rick? I just don’t have the number at my fingertips. I’d be happy to give you a call after the meeting, okay? Rick Patel – Bank of America: Appreciate it. Thanks, and good luck on the new year.

We will now go to our next question from Jeff Stein of Northcoast Research. Jeff Stein – Northcoast Research: Okay, good morning guys. A couple of questions here. First of all, Ron, can you discuss the other operating income line, which was up slightly in Q4 but it looks like the rate of growth year-over-year dropped relative to the first nine months. Anything there we should be focused on?

No, I wouldn’t think you should be focused on anything in particular. We did make some small internal changes in some processing of cycles in February, which had a slight impact on that number; but I wouldn’t think you should read anything dramatic into it. The receivable portfolio was up, and operating income when we look forward into next year will continue to grow as the receivable portfolio goes. Jeff Stein – Northcoast Research: Got it, got it. And the 5 to $7 million of supply chain investment, is that going to be run through gross profit or SG&A?

It will run through gross profit because it’s the nature of manufacturing, so we’ll be including it in our gross profit line. It’s included in our guidance, Jeff, when we talk about being able to—you know, we’ll be able to accept that charge and still we believe be relatively similar in our gross margin ratios, so we’ve included that in our thinking. It’s not incremental to, so I don’t want you to think that it is, okay?

Yeah, it’s all built into the bulk.

It’s all built into the guidance we’ve talked about. Jeff Stein – Northcoast Research: Understand, okay. And your SG&A leverage point, any change there this year relative to last year?

My favorite question always, as you know. The leverage point really depends on what we decide to spend in advertising and how it moves around. The leverage point on occupancy expense, which was a very successful point for us last year, remains very low single digit comp to start to leverage occupancy costs. Both of these things move around as we open up new stores and as we decide to change our advertising investment, so it’s hard to pick just one particular number. Generally if it comped at mid-single, we more than adequately leveraged many things. Jeff Stein – Northcoast Research: Okay, very good. Thank you.

We will now go to our next question from Anthony Lebiedzinski of Sidoti & Company. Please go ahead. Anthony Lebiedzinski – Sidoti & Co.: Good morning. Just a follow-up on the advertising question. Can you give us maybe some color on how much you expect to increase your advertising expenses by, and also give us a better understanding as to the breakdown between TV and radio and other media, whether that’s going to change significantly from the past?

Well, what I would say is that we don’t like to go into too much detail of exactly what level of advertising increase we would realize. It depends upon the performance of the business, it depends upon advertising rates that we are experiencing, it depends upon competition this year from the presidential election and all of the money that will be spent. So I don’t really want to give you a specific number, nor would I tell you specifically how the mix is going to shift. I would tell you that TV advertising remains primarily our number one approach, but social media and direct-to-consumer marketing are also important in our mix, as is radio to a certain extent. So I would still say to you that TV will be predominant, but the other mix factors are moving as the market develops. Mike, I don’t know if you had anything to add?

No, I was just going to say it’s something that we track very carefully. We take a very scientific approach to it. Yes, we are increasing our advertising this year, but as Ron said, we like to think of it as a cumulative number. In all of those different categories Ron called out are still very important to us, whether it be online, radio, or TV, which is still the major part of the advertising. The reason that we’re continuing to increase it is because it drives sales, it works for us.

And again, I’d point out that while we’re increasing it, we’re also committing that at a minimum we’ll be able to maintain across the year our SG&A ratio. So we’re watching it – while we increase one, we’re making sure that the business performance justifies and that we’re getting the return on investment necessary to continue with spending. So we watch it and balance it very effectively. Anthony Lebiedzinski – Sidoti & Co.: Mm-hmm, okay. And as far as current trading, the February comp in the U.S., how much is that driven by ASPs?

Well, it’s driven by both ASPs and by volume. Remember what’s going on, as Mike alluded to, is the fact that we have the bead programs, which are high volume driven but low price, and then we have the diamond programs. I would say that they’re both driving. I would say that pricing continues to be slightly more important than volume on a net basis. Anthony Lebiedzinski – Sidoti & Co.: Mm-hmm. And as far as the store remodels, do you have a breakdown between the Kay and Jared stores?

I did not provide that level of detail on an overall basis. It will be close to 110 stores across the enterprise.

And that’s about 90 in the U.S., but we didn’t bring the breakdown between Kay and Jared on that. Anthony Lebiedzinski – Sidoti & Co.: Okay, that’s fine. Thank you.

As a reminder at this time, if you would like to ask a question, please press star, one on your telephone keypad. We will now take our next question from Rod Whitehead of Deutsche Bank. Please go ahead. Rod Whitehead – Deutsche Bank: Hi there. Three, if I may. One very quick one – I missed the figure you gave for ecomm growth in the U.S.

Well, I didn’t. I gave an overall basis. I said it was 36.5%. It’s around 45% in the U.S., I’m sorry. On an overall basis, the growth rate was 36% and the total ecommerce sales were 92.3 million. Rod Whitehead – Deutsche Bank: For the group?

Yes, sir. Ronald Whitehead – Deutsche Bank: Brilliant, thank you. And secondly on—you mentioned at one point, Mike, that you were working strategically with the watch brands. I wonder what that meant, and in particular one of the things you trialed last was the Michele watch brand, and how that has performed and whether that would be rolled out. And then finally, just on your buyback program, you said at the investor day that you ideally wanted a balance of 7 to 9% of sales, which is roughly $300 million; and you’re currently at 500 and your free cash flow is going to be at least 200 for the next couple of years. So if you only buy back 300 in the next two years, then your cash balance is actually going to go up from 500 to 600. So I was just wondering whether there is an intention for a further buyback program within the next two years?

Okay, well we’ll start with the watch question first. Now, we’re very excited with some of the partnerships that we have with a lot of the major brands out there. I just got back from the Basel Fair with both the U.K. and the U.S. teams a couple of weeks ago, and we had some great meetings. We’re continuing to get closer with our partners. We’ve got some exciting things going on, including building major boutiques for people like Omega and Breitling in the U.K., and TAG here in the U.S. So we think these are very important partnerships. We think that they’re going to be great business drivers for us in the future, and we continue to work with them in a very positive way. We are testing and trialing some other brands – Michele, as you mentioned. We started with that in about 26 Jared doors. We’re actually going to increase the trial a little bit. We’ve seen some good pockets of success there, and it’s also done very well for us online so we know that we have the customer out there, but it is a new brand for us. So all in all, the brands are doing extremely well for us in the watch category, and it’s something that we would expect to see continue for the future. We look forward to continuing to build those partnerships. As far as the stock buyback, as we mentioned, it continues to be in force; and we had just gotten started January 16, so it’s still very new. We intend to continue on with it as appropriate, and we will address--the Board will address our balance sheet and our cash balances on a regular basis, and as it is appropriate we’ll look at doing other things. You know, we increased our dividend by 20% from $0.10 a quarter to $0.12 a quarter, so that’s another move. That’s what we intend to do – we intend to take very thoughtful measures from quarter to quarter and year to year to make sure that we’re delivering the best value we can for our shareholders. So it’s not like a one and done necessarily on the stock buyback or the dividend or whatever it may be. We’re always going to take it very seriously and analyze our situation and make those appropriate decisions. Ronald Whitehead – Deutsche Bank: Thank you very much, Mike.

We will now go to our next question from David Jeary of Investec. David Jeary – Investec: Yes, good afternoon gentlemen. A couple from me if I may, please. Coming back to the supply chain investments, Mike, I still don’t fully understand what you’re looking at. I know you used the words exciting initiatives, so I’m just wondering if you could help us to become a bit more excited by giving a bit more insight as to what exactly they were. And secondly, re your comments on marketing, I know you take a very holistic view of SG&A and returns. I was just really going to ask a question on that point specifically on U.K. marketing. I mean, the spend was up 22%, so sales and profits obviously not up by anywhere near those same metrics. I just wonder how you look at that in the context of what is obviously a difficult market and how you justify making that kind of investment relative to the returns, please.

Sure. Good morning or afternoon, David. As far as the supply chain initiatives, the reason I haven’t kind of lined that out a little bit more clearly, I want everyone to understand that we are appropriately investing in the future of our company and that includes making sure that we secure our supply chain better, we build better partnerships. There’s a lot of different things that we can have in the works, but until it’s the appropriate time I really can’t get into a lot of detail on that because—and quite frankly, I don’t want to tip our hand to the competition on everything that we’re working on. So we want you to know that we’re working diligently to do the right things and to secure the future of our business needs, and we will give you some more details on that as soon as we can. In terms of marketing in the U.K., one of the things we said we were going to do—we’re very pleased with our business in the U.K. and especially when you look at the retail environment and the overall economic environment in the market, which I’m sure you know extremely well. We’ve done very well in that market compared to a lot of the other non-food retail companies out there. In fact, we have consistently beat the non-food retail on a regular basis, and we are going to continue to invest in our business. We believe that when it comes to taking market share and taking a leadership position and being the leader in the market, we need to appropriately invest. We’re going to remodeling stores in the U.K. Out of that 110 major remodels or relocations we talked about, about 20 of those are in the U.K., and that’s a big part of that when you look at the split between the U.S. and the U.K. So the important thing to us is, yes, we did increase our marketing and we feel like that will help us drive long-term value and sales in the U.K. That’s why we’re doing it. This is not the time to shy away from investment. We believe in the marketplace. We think that we have a bright future there, and it’s tough times right now but hopefully it won’t always be that way, and we are preparing ourselves for the future and making sure that we make the correct investments to get us there. David Jeary – Investec: Okay, thank you very much, Mike.

We will now take our next question from Andrew Hughes of UBS. Andrew Hughes – UBS: Yes, hi guys. It’s Andrew Hughes from UBS. This is obviously the U.K. section of the call. I had a question about the U.S. business and the EBIT margin up at 15.8%. Looks to me like it’s an all-time high, certainly a 10-year high. Can you just give us some sort of thoughts about how you look at it now? I mean, clearly there may be some that get concerned about over-earning with an EBIT margin that high. The flip side of the coin is that the structure of the industry is completely different from the past. So do you think that you can continue to push on with that EBIT margin?

I would say that, number one, of course we’re very pleased with that EBIT margin, and I believe you are correct – it is a record. It also—the business is performing very strongly in the U.S. and it continues to set new records. So just because we’ve established a record doesn’t mean we intend to stop there, nor do we think it’s a limitation. As we focus on improving the productivity of the store chain, which even though we’re opening up 45 new stores, the main driver is improving the productivity of sales within the Kay and Jared and regional brands that are already established. That is a very profitable way to grow sales because obviously we don’t have to make the capital investments or have the maturation of store issue that we deal with, so that we believe that the stores will continue to gain market share, continue to improve in productivity, and as they do that, they will continue to move higher in terms of the operating margins of the U.S. business. So I think it is wonderful that it’s a record. We do not think it is a limitation. We believe that we can continue to push forward, and that’s what we are planning for in 2013. Andrew Hughes – UBS: Okay, but the guidance you’ve given broadly is flat gross margin, flat cost ratios for this year, so the implication is that you might sort of pause for breath this year before continuing onwards and upwards in outer years. Is that a sort of fair assessment?

Well, I think we always try to be reasonable with any statements we make relative to future guidance, because it’s always difficult to predict. But this year we probably wouldn’t have predicted getting to 15.8% if we had made a prediction, so I think that we always strive to get better while maintaining a conservative outlook so that we can not disappoint our investors. Andrew Hughes – UBS: All right, good. Thank you very much.

As there are no further questions in the queue, that will conclude today’s question and answer session. I would now like to turn the call back to Mr. Tim Jackson for any additional or closing remarks.

Thank you, Operator, and thanks to everyone for taking part in this call. We really appreciate it. Our next scheduled call is on May 24 when we’ll review our first quarter results. Have a great day and thank you again.