Question-and-Answer Session
Operator
The first question comes from Tony Cristello, BB&T Capital Markets. Please go ahead.
Anthony Cristello- BB&T Capital Markets
Rob, when you look at sales trends, and obviously they have been strong over the last two months, and you noted the 5% increase in April so it seems like sales are being helped by price, but I am interested in what you are seeing on the traffic side. You said that April and May traffic has been up and I am assuming that it is up for the first time in awhile. Are those new customers, or existing customers that are coming back to perform maintenance that they have deferred? Can you give more color on what you are seeing?
Robert Gross
I think it is a combination of both. We were running mediocre numbers since July of last year. That is more than the normal deferral period of four to five months. What happens once you get beyond that, when people come back after that period they are customers that trust us because they are trying to defer the purchase? It ran the course of the normal oil change, they are back and they are buying potentially with bigger repairs. That being said, there are still long-term customers that are going to be walking into our stores today and deferring. But the normal deferral period is four to five months. Once you get beyond that, which we were in Q4, you then start to get new customers still deferring and old customers coming back. With April and May, to your point, we haven’t seen store traffic increases, certainly haven’t seen a +5, and +2.5 in May is very unusual also, so whether it is the digital advertising, the internet, some of the additional direct mail we are running, or some radio tests that we ran successfully in November, which we said we would put in our quiver of arrows to bring out in April or May, obviously have helped drive the traffic.
The price increases people understand and you put that together and at least for a two month period whether it is an aberration or a trend we look pretty smart right now, and are pretty encouraged. If you would have asked me in March what I thought April through June would have brought I would probably have fallen somewhere around the +1 or +2 comp numbers. Hopefully it continues; in Q1 we are up against our toughest comp number, we are doing this against a +6 last year and once we again into the summer driving months in the second half of the year we are up against some really soft numbers. Hopefully it ends up well, but obviously I continue to be concerned with some record low consumer confidence numbers, $4 gas, foreclosures, and anything else that someone like me can be concerned about.
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