Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from David Schick – Stifel Nicolaus,
David Schick – Stifel Nicolaus
You talked about during the quarter accelerated hub store roll out and some expenses around that, the medical expenses ratio, sounds like that might lap or you’re working it lower, and the legal fees. If those were normalized, just sort of in rough numbers, what might the SG&A run rate have looked like?
William T. Giles
Well, as we indicated, I mean, we leveraged about 80 basis points off of store expenses for the quarter and then we highlighted some of the other additional expenses, so that might be an easier way to think about it, which is kind of why we highlighted it that way.
David Schick – Stifel Nicolaus
So should we think that those things will be normal? How about the hubs for roll out? Essentially what I’m trying to see is did you pull it forward or is that a preview of what . . .?
William T. Giles
We pulled it a little bit forward but we really believe that the hub store has a significant opportunity for us, so as we continue to see an opportunity for us to accelerate the hub stores, we are going to continue to do that. So we have had good results on it, it’s very early in the process, so we did accelerate it a little bit into this quarter and so I would expect us to keep a similar pace as we go through the rest of the year.
William C. Rhodes III
I think it’s also important to understand that the hub stores, yes, there are some one-time operating expenses, one-time opening expenses of resetting the hubs, but there are also increased ongoing operating expenses.
David Schick – Stifel Nicolaus
You have talked about business obviously better, traffic versus ticket, are more people in the stores or are they doing more per job? Could you break that out for us?
William C. Rhodes III
I think over a long period of time our traffic count has been down, but our traffic count clearly improved during the quarter and our average ticket continues pretty much on its normal course.
David Schick – Stifel Nicolaus
So more people are working are working than rather necessarily different work, is that the take-away from that?
William C. Rhodes III
I think that’s right.
- To read the full transcript on Seeking Alpha, click here »
