Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Jeff Klinefelter - Piper Jaffray
Jeff Klinefelter - Piper Jaffray
I wanted to speak to you a little bit about ’09. I certainly can appreciate not providing guidance which it seems prudent at this point and thank you for your CapEx visibility. Can you help us a little bit with how to think about your line items on your income statement in particular the S&D in terms of the relationship between the top line?
We can see what happened in 2008, since all of us do have to approach some sort of a modeling criteria for ’09 how should we think about the relationship of S&D and your ability to cut that back further or where you’re leverage points are. In other income, if you could help us understand what’s in that $5 million bucket in Q4?
Jonathan Ramsden
With regard to MG&A expense as we said, we’re very confident that that is going to below 2008 levels because that is directly under our control and doesn’t necessarily vary dollar for dollar with sales. For stores and distribution expenses for any given level of sales we are implementing reductions in that category. It’s tough to give a specific commitment on that because that does in part vary somewhat with sales. What we can say is we’re very focused on that and for any given level of sales we believe that expense will be lower than it would have been previously.
Brian Logan
In regard to the other income line, the amount that you’re seeing in the fourth quarter primarily relates to gift card. This is gift cards that have been deemed that redemption will be remote and its something that we do on a quarterly basis. The fourth quarter obviously tended to be a little bit bigger because historically that’s when a large percentage of gift cards are generally purchased.
Operator
Your next question comes from Dana Telsey - Telsey Advisory Group
Dana Telsey - Telsey Advisory Group
As you think about each brand how are you thinking about positioning of the brand whether its with IMU in this environment and the potential mark down rate that could occur is there any different way you’re looking at it or thinking about it whether its pricing, whether its styling and also flow of product.
Mike Jeffries
My first statement, protecting the brands is our priority in this environment as in any. We are working very hard for better quality and in fact better trend. We’re starting to see some better trend product in women’s tops which has been a real priority of ours. It doesn’t look as if we’re going to have a major trend to report in women’s tops but there are a number of different things happening. We hope to see more improvement in that assortment as the season proceeds.
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