Ladies and gentlemen, thank you for standing by. At this time, I would like to welcome everyone to Burlington Stores, Inc First Quarter 2024 Earnings and Webcast. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question again, press the star one. Thank you. I would now like to turn the conference over to David Glick, Senior Vice President. Please go ahead. Thank you, operator, and good morning, everyone. We appreciate everyone's participation in today's conference call to discuss Burlington's fiscal 2024 first quarter operating results. Unless otherwise indicated, our discussion of results for the 2024 first quarter exclude the impact of certain expenses associated with the acquisition of Bed Bath & Beyond leases. Our presenters today are Michael O'Sullivan, our Chief Executive Officer, and Kristin Wolfe, our EVP and Chief Financial Officer. Before I turn the call over to Michael, I would like to inform listeners that this call may not be transcribed, recorded, or broadcast without our express permission. A replay of the call will be available until June 6, 2024. We take no responsibility for inaccuracies that may appear in transcripts of this call by third parties. Our remarks in the Q&A that follows are copyrighted today by Burlington Stores. Remarks made on this call concerning future expectations, events, strategies, objectives, trends, or projected financial results are subject to certain risks and uncertainties. Actual results may differ materially from those that are projected in such forward-looking statements. Such risks and uncertainties include those that are described in the company's 10-K for fiscal 2023 and in other filings with the SEC, all of which are expressly incorporated herein by reference. Please note that the financial results and expectations we discuss today are on a continuing operations basis. Reconciliations of the non-GAAP measures we discussed today to GAAP measures are included in today's press release. Now, here's Michael. Thank you, David. Good morning, everyone, and thank you for joining us. I would like to cover three topics this morning. Firstly, I will discuss our Q1 results. Secondly, I will talk about our Q2 guidance. Finally, I will comment on our full year outlook. After that, I will hand over to Kristin to walk through the financial details of our Q1 results and our updated 2024 guidance. Then we will be happy to respond to your questions. Okay, let's talk about our first quarter results. I'm going to start with total sales. We believe that total sales growth compared to other retailers is the best proxy indicator for what is happening with market share. Our total sales in Q1 grew by 11% compared to the first quarter of 2023. That was on top of 11% total sales growth versus Q1 of 2022. New stores are a key driver of this top-line growth. In Q1, we added 14 net new stores and ended the quarter with 1,021 stores. We are on track to open 100 net new stores this year. The other driver of top-line sales is comp store sales growth. Comp store sales for the first quarter increased 2% versus our guidance of flat to 2%. This 2% comp store sales growth was on top of last year's Q1 comp store sales increase of +4%. As we described in our last earnings call on March 7, our February sales trend was softer than we had anticipated. We believe that this was attributable to disruptive winter weather, as well as the slower pace of tax refunds versus February of 2023. As we have discussed in the past, our core lower-income shopper is sensitive to the timing of tax refunds, specifically refunds related to Earned Income Tax Credit. As you might expect, as tax refunds began to normalize, our sales trend improved as the quarter unfolded. In the March, April period combined, our comp sales increased a solid 4%. Because of the timing of Easter Sunday, it is very important to look at the comp sales trends for these two months combined. Similar to the fourth quarter, our regular price selling was particularly strong. For the quarter as a whole, our regular price comp growth was + 4%, and for the March, April period, it was + 6%. These growth rates more than offset a double-digit decrease in clearance sales. This level of regular price selling is very healthy. It shows that shoppers are responding well to the assortments and great values they are finding in our stores. Before I turn to our outlook for the second quarter and the full year, I would like to comment on our strong profit growth in Q1. Our EBIT margin increased a robust 170 basis points, and our adjusted EPS was up 68% over last year. As Kristin will explain in a moment, this favorability was partially driven by expense timing, but even after adjusting for this, our margin and earnings performance was well ahead of our guidance. There were two major drivers of this strong margin expansion. Firstly, as I mentioned a moment ago, our regular price selling was very strong. This drove faster turns and lower markdowns. The second major driver was faster than expected progress on our supply chain efficiency initiatives. We are encouraged by the strong early results that we are seeing from this program. Okay, let me move on to the outlook for the second quarter. Our comp guidance for Q2 is flat to 2%. We recognize that based on our most recent trend, there could be upside to this forecast, but there are a couple of reasons to remain cautious. Firstly, we believe that our strong March and April trend was driven by the catch-up in tax refunds, and we expect that at some point, this tailwind could abate. Secondly, our comp growth for each of the past two quarters has been +2%, so it feels reasonable to keep our guidance tethered to +2%. If our Q2 trend turns out to be stronger than this guidance, I am confident that we will be able to chase it. It is worth calling out that in the first quarter, as the comp trend picked up rapidly in March and April, our merchandising and supply chain teams did a nice job ramping up receipt flow to chase these sales. So to reiterate, our Q2 comp guidance is 0%-2%, but we hope to do better. Let me segue now to our outlook for the remainder of the year. At this point, we are maintaining our comp guidance for the full year at flat to 2%. That said, based on the strength of our first quarter margin and earnings performance, we are raising our full-year margin and adjusted EPS. Kristin will provide further details on this in a few moments. Reflecting on our start to 2024, I am very pleased with our underlying sales trends and our margin performance. We are well positioned for Q2 and the rest of the year. I'm even more excited about the longer-term opportunity in front of us. As we have discussed before, over the next five years, we believe that we can grow our sales to $16 billion and our operating income to $1.6 billion. That is almost 3x our 2023 operating profit. Now, I would like to turn the call over to Kristin, who will share more details on our first quarter financial results, our outlook for Q2, and our updated full year 2024 guidance. Kristin? Thank you, Michael, and good morning, everyone. Okay, let's now move on to the details of our first quarter results. Total sales grew 11% and comp sales grew 2%, both at the high end of our guidance. Our adjusted EBIT margin expanded 170 basis points versus last year, and adjusted earnings per share increased 68% compared to last year, both significantly ahead of guidance. The drivers of the better-than-expected margin expansion in Q1 were a much higher gross margin, improved expense leverage in supply chain, and a timing shift of approximately $9 million of expenses. Let me walk through the details. The gross margin rate for the first quarter was 43.5%, an increase of 120 basis points versus last year. This was driven by a 90 basis point increase in merchandise margin due to strong regular price selling, which generated faster inventory turns and lower markdowns. Freight expenses leveraged 30 basis points, primarily due to lower freight rates and cost savings initiatives. Product sourcing costs were $183 million, versus $187 million in the first quarter of 2023, decreasing 100 basis points as a percentage of sales. 80 basis points of this favorability came from supply chain. There were two drivers of this supply chain leverage. First, and most significantly, we made faster than expected progress on our distribution center productivity initiatives. And secondly, we benefited from the timing of receipts between Q1 and Q2. Adjusted SG&A costs in Q1 were 60 basis points higher than last year. This was partly driven by $6 million of dark rent and other expenses related to the Bed Bath & Beyond leases. Excluding these expenses, adjusted SG&A deleverage was 40 basis points, driven primarily by increased investments in store payroll. Q1 EBIT margin was 5.7%, 170 basis points higher than last year, compared with guidance for an increase of 20-60 basis points. Our adjusted earnings per share in the first quarter was $1.42, which was well above the high end of our range of $0.95-$1.10. This result and the guidance range exclude approximately $6 million of pre-tax expenses associated with the Bed Bath & Beyond leases. At the end of the quarter, our comparable store inventories were 6% below 2023, while our reserve inventory was 40% of our total inventory versus 44% last year. We are very happy with the quality of the merchandise and the values that we have in reserve. During the quarter, we repurchased $63 million in common stock. As of the end of the first quarter, we had $442 million remaining on our share repurchase authorization that expires in August 2025. In the first quarter, we opened 14 net new stores, bringing our store count at the end of the quarter to 1,021 stores. This included 36 new store openings, 11 relocations, and 11 closings. We continue to expect to open 100 net new stores in fiscal 2024. Now I will turn to our outlook for the full fiscal year, the second quarter, and the back half of the year. We are increasing our full year earnings guidance and maintaining our comp sales outlook of flat to up 2%. In addition, due to slightly later timing of new store openings, we are making a modest adjustment to our expected total sales growth to an increase of 8%-10% for the full fiscal year, just below our original guidance of 9%-11%. Based on our strong first quarter financial performance, we are increasing our margin and adjusted earnings per share guidance for the full fiscal year. We now expect our full year adjusted EBIT margin to increase by 40-60 basis points, up from our original guidance for an increase of 10-50 basis points. This updated margin outlook now translates to an adjusted earnings per share range of $7.35-$7.75, up from our original guidance of $7-$7.60. For the second quarter, we are guiding to a comp increase of flat to +2% and a total sales increase of 9%-11%. This would result in operating margin expansion of up 30 basis points to up 50 basis points versus Q2 of 2023. This translates to earnings per share guidance for the second quarter of $0.83-$0.93, which includes an approximately $0.09 negative impact from the timing of expenses from Q1. Consistent with prior quarters, this guidance excludes expenses associated with the recently acquired leases from Bed Bath & Beyond of approximately $0.03. For the back half of fiscal 2024, this outlook assumes comp store sales of 0% to +2%, total sales to increase 7%-9%, and EBIT margins to be flat to an increase of 30 basis points, and earnings per share in the range of $5.10- $5.40, an increase of 7%-13% compared to last year. I will now turn the call back to Michael. Thank you, Kristin. Let me recap four key points that we've discussed this morning. Firstly, we are pleased with our sales growth in Q1. 11% total sales growth for the quarter, 2% comp sales growth for the quarter, and 4% comp sales growth for March, April combined. Secondly, we are very pleased with our Q1 margin and earnings results. These were driven by higher merchandise margins from strong regular price selling, leading to faster turns and lower markdowns, and also driven by faster than expected progress on our supply chain initiatives. Thirdly, we are maintaining our flat to 2% comp guidance for Q2. We recognize that given our recent trends, this may be conservative, but we are very well positioned to chase. And finally, we are raising and updating our full year earnings guidance to reflect our strong ahead of plan Q1 results. With that, I would now like to turn the call over for your questions. Thank you. The floor is now open for questions. If you have dialed in and would like to ask a question, please press star one on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star one again. If you are called upon to ask your question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. We do request for today's session that you please limit to one question and one follow-up. Again, press star one to join the queue. Your first question comes from the line of Matthew Boss with JP Morgan. Your line is open. Great, thanks, and congrats on a nice quarter. Thanks, Matt. So Michael, could you elaborate on the progression of your comp sales trend through the first quarter? Walk through some of the factors, such as tax refunds, that may have impacted the trend. And then could you comment on what you're seeing so far in May? Well, good morning, Matt. Thank you for the question. I think it may be easier if I just share the month-by-month comp numbers. February was a - 2 comp, March was a + 1%, and April was up 8%. Now, to make sense of those numbers, it's important to adjust March and April for the timing of Easter. Our stores are, like many retailers, closed on Easter Sunday. This year, Easter Sunday fell in March versus April last year, and that means that March had one less selling day this year, and April had one more selling day this year compared with 2023. That shift of a selling day is worth 3-4 points of comp within each month. So if you adjust for the timing of Easter Sunday, then what you see is a strong pickup in the trend in March versus February, and then that momentum continued through April. Now, we believe that the major driver of this month-by-month trajectory was the timing of tax refunds. As we've explained in the past, our core lower-income customer is very sensitive to the timing of tax refunds, especially the timing of Earned Income Tax Credit. Now, in February, those refunds fell behind last year's levels. They did eventually catch up, but not until the end of March, and that timing correlates with the momentum in our sales trend. I'd say there is one other factor that we think may have contributed to the monthly trend. This year, we made a deliberate decision to slow our seasonal merchandise later in the quarter than we did last year. The benefit of that is that it gave us a chance to read and react more effectively to early season trends at a business and at a store level. By slowing receipts later, we were able to adjust the mix of those receipts, and we were able to adjust the allocation of those receipts by store based upon real selling data. And I would say that contributed to faster inventory turns, lower markdowns, and stronger sales. I guess the last part of your question was about May month- to- date. I would say that we are happy with how sales have been trending this month. Q2 is off to a good start. But that said, there's still a long way to go in the quarter. Great. And then maybe a, a follow-up for Kristin, just on your first quarter margin and the expense shift. Could you just provide any, any additional color on the expenses that shifted out of the first quarter, and why? And then excluding the shift, could you just walk through the drivers of operating margin upside that you saw in the first quarter? Matt, good morning. Yes, thanks for the question. Overall, we did have a strong first quarter in terms of margin expansion, about 170 basis points versus last year. And this expansion does include a benefit from the timing of expenses that's worth about $9 million, or around 40 basis points, out of Q1 and primarily into Q2. And after accounting for the expense timing, our Q1 adjusted EBIT margin increased 130 basis points versus the first quarter of last year, which was well above our guidance of 20-60 basis points. So let me give a little more detail on the expense shift. There were really three drivers. The first was in supply chain, which represented approximately $3 million. This was driven by two factors. The biggest piece was the timing of receipts. So some receipts expected, that we expected to be processed in Q1 shifted to Q2. And then secondly, there were some start-up expenses associated with the opening of our new New Jersey distribution center, which opens in the second quarter as we planned. The second factor in the expense timing was on freight. There was about $2 million in freight expenses that shifted from Q1 to Q2, and that was associated with the receipt timing. And then finally, there was approximately $3 million of SG&A items. This includes the timing of marketing spend and select benefit expenses. These shifted out of the first quarter and into the second quarter, and then another $1 million of miscellaneous SG&A items that shifted out of Q1 and into fall. So in total, the expense timing shift included $8 million out of Q1 and into Q2, and $1 million shifting out of Q1 and into fall. So looking at the quarter net of these expenses, as part of your question, EBIT margin, as I mentioned, expanded by 130 basis points. And this, this is really driven by three primary factors. First, a 90 basis points increase in merchandise margin due to faster inventory turns and lower markdowns. Secondly, a 70 basis points of leverage, and excluding the timing of expenses there, 70 basis points of leverage in supply chain, and then 20 basis points of leverage on freight. And partly offsetting the leverage of those items was deleverage in SG&A, namely in store payroll and then also in depreciation given the higher CapEx spend. Great color. Best of luck. Thanks, Matt. Thank you. Next question comes from the line of Ike Boruchow with Wells Fargo. Your line is open. Hey, good morning, everyone. Great print. Two questions. First for Michael, just if we could kind of unpack the low-end consumer a little bit more, I know you guys have a lot of ties there, and Michael, you spoke about that a little bit. So we've heard a lot of noise and volatility in that consumer. It looks like you guys bucked that trend pretty nicely in the quarter. So I guess my question is, what exactly are you seeing with that, with that cohort of the consumer base today? And then what exactly did you guys do to help perform there? Well, good morning, Ike. Thank you for the question. Let me start by saying that we think the external environment is very hard to read right now. But our assessment is that all income groups, not just lower income consumers, all income groups are feeling economic pressure. I know this is not a very sophisticated framework, but we divide the world into two main segments: need-a-deal shoppers, who tend to be lower income and have larger family size, and want-a-deal shoppers, who tend to have slightly higher incomes and more financial choices. And both of those segments shop off-price. Now, the need-a-deal shopper needs value, especially at opening price points and on moderate brands. And as we said before, that shopper is very important to us. So in your question, you kind of referenced sort of noise and I would say investor concerns about those lower-income consumers. You know, we actually think that at this point, those, that noise, those concerns may be overblown. We think that at this point, you know, those concerns are mostly in the rear. rear. They concern a phenomenon that's really in the rearview mirror. In 2022, and we certainly felt this, those lower-income shoppers were crushed by the combination of the higher cost of living and the end of pandemic-era benefits. But our view is that since then, in other words, over the last five quarters, discretionary income for that demographic appears to have stabilized. Now, the consumer, that consumer is still fragile, and we saw evidence of that with the delayed tax refunds in February. But inflation has come down, and it looks like real incomes at the lower end are not shrinking in the way that they were in 2022. You know, we're not saying that the situation for this customer is getting better yet. They're not bouncing back. But our assessment is that the situation doesn't seem to be getting any worse. So coming back to your question, how to explain our strong trend in March and April? I think that there are two factors that explain that trend. Number one. The catch-up in tax refunds in that period meant that lower-income shoppers had some extra money in their pockets. In the last couple of years, that shopper has really come to appreciate Burlington as a great place to find value. So it's natural that they would come to us when they have some extra money to spend. The second factor is unrelated to lower income shoppers. You know, when we look at selling, especially on better brands at higher price points, we believe that we're seeing we're benefiting from more trade-down traffic in our stores. And that's helping to support our comp trend. In 2022, it felt as if moderate to high income shoppers were somewhat insulated from the impact of inflation. Perhaps they had excess savings that they could tap into. But we believe that now that demographic is also feeling the pinch. We think that's good for us. It means that those customers are shopping off-price in search of value. Got it. Very helpful. And then, Kristin, if I can sneak one more in. Just, you referenced the supply chain efficiencies in the quarter benefiting you. Can you just unpack that a little bit more? Just what exactly are those drivers that led to some of that upside in the first quarter? And then, I guess the follow-up to that is: Is there more to come there, or is this just a one-time thing in the first quarter? Is there possible more efficiencies to come? Thanks. Great. Good morning, Ike. Yeah, it's a good question. We were encouraged by the progress we're making in terms of driving down supply chain costs as a percentage of sales. Excluding that expense shift I just talked about in Q2, supply chain leveraged 70 basis points, which is more than we had planned. And I've shared before, we've talked about a number of productivity initiatives we have in place in supply chain, where we're targeting meaningful cost savings. These are process improvements, industrial engineering-oriented improvements that streamline operations, reduce touches, reduce time to process merchandise, and ultimately save labor dollars in our DCs. In the first quarter, we found we're harvesting these savings a bit faster than we'd originally expected. And to kind of your follow-up question, on is there more to come? Yeah, as you know, we've said we believe that we have about 400 basis points of EBIT margin opportunity over the next five years. That's using 2023 EBIT of around 6% as the baseline. We believe about half of this, 200 basis points of the margin opportunity, is independent of sales, and a meaningful part of this 200 basis points will come from, or we expect to come from continued supply chain leverage, with the balance coming from lower freight and higher merchandise margin. So we feel like we've demonstrated good progress in the first quarter on all three of those line items, particularly supply chain. Awesome. Thanks again. Bye. Next question comes from the line of Lorraine Hutchinson with Bank of America. Your line is open. Thank you. Good morning, Michael. Your off-price peers have talked about increasing their mix of brand as a way to drive comps. In March, you said this might be an opportunity for you as well. Do you have any update on this? And also, I'm curious if you see any risks to this strategy. Well, good morning, Lorraine. Good to hear from you. Yes, we do see an opportunity to increase our mix of brands, and actually, more generally, we see an opportunity to elevate our assortments. In fact, we're already seeing some success with that approach in businesses like sportswear. But we plan to lean into that opportunity more, I would say, in the back half of the year. But let me spend a minute just sort of talking about the role that brands play in our business, and also addressing the last part of your question about the risks or the limits of that strategy. Now, in off-price, brands are important, but the most critical thing by far is value. Brands are just one component of value. Fashion, quality, and of course, price, also drive the customer's perception of value. You can have a great brand, but if the fashion, the quality, or the price are wrong, the customer isn't gonna buy it. It's gonna end up in the clearance run. The second point to make is that the role that the brand plays in defining value depends on the category and also depends on the customer and their price sensitivity. That's why our merchants spend a lot of time planning and styling out the whole rack and then executing our good, better, best strategy. Again, brands are important, but they're just one piece of that. I should add, you know, that calculus may be different for other retailers, depending upon their own customer profile. Okay, so with all of that as context, let me talk about where we see opportunity. As I said earlier, in this economy, we believe that all shoppers are now focused on value. We know that we do. I think we do an excellent job when it comes to the low income, need-a-deal shopper. And let me emphasize, we intend to continue to do an excellent job with those very important customers. But we think we can also do more to drive sales with trade down or slightly higher income shoppers. When those shoppers walk in our store, they're more likely to be drawn to great deals on better brands. So as we get further into the year, you'll see more of those brands in our runs. And now, as you'd expect, we'll do that selectively in businesses where it works and where brands really matter. But let me maybe finish up by reinforcing the point that we see this as a and strategy. You know, we'll go after this trade down opportunity, and we're gonna continue to deliver for our core need-a-deal shoppers as well. Thank you. And then, Kristin, the margin performance in the first quarter was much better than we expected. Obviously, the balance of fiscal 2024, including 2Q, is, is not calling for that kind of increase in EBIT margins. What was unique about the first quarter that enabled such strong flow-through, and why aren't we seeing the same outlook for the balance of the year? Also, what should we expect in 3Q and 4Q? Great. Good morning, Lorraine. Thanks for the question. Certainly, we had strong margin performance in Q1. Lower clearance levels and faster turns really helped drive strong merchandise margins, and our supply chain leverage was better than we had expected, as I spoke about just a few moments ago. But to your question, in turning to the second quarter, there are a couple call-outs I wanna make. First, we have about $9 million in expenses that shifted out of Q1, of which $8 million shifted into Q2. So that's having around a 30 basis point negative EBIT margin impact on the second quarter. And in addition, our newest distribution center in New Jersey will be coming online in the second quarter, in this quarter, which will add some modest deleverage in supply chain, given the start-up and training costs. Now, we expect that this will be more than offset by the productivity initiatives I just talked about in supply chain, but that will likely temper the leverage in supply chain in Q2. And then to your last question, on the back half of the year, there is a 53rd week impact. Fall total sales growth is planned for 7%-9%, slightly lower than our full year guidance of 8%-10%. The 53rd week has the most acute impact on Q4 sales growth, where we are essentially trading a week in November for a week in January as compared to Q4 last year from a total sales growth standpoint. Now, we'll share more detail on Q3 and Q4 margin guidance on our call in August. But for now, as you think about modeling Q3 and Q4, keep in mind that the total sales growth for Q3 will be higher than Q4 due to the 53rd week calendar impact, which will impact... which will thereby impact the relative margin improvement for Q3 versus Q4. Thank you. Next question comes from the line of John Kernan with TD Cowen. Your line is open. Thanks. Good morning, Michael, Kristin, David. Nice job on the top line and the margin flow through. Kristin, let's, let's just keep it on the margin theme here. It looks like freight was a margin driver in Q1. Will freight continue to be a margin tailwind for the rest of the year? Is there any chance it becomes a headwind as you get further into the year? And just a quick follow-up for David after that. Great. Good morning, John. I appreciate the question. We were pleased with the 30 basis points of leverage we saw in freight in the first quarter. About 10 basis points, as I described, was due to the timing of receipts, but the majority of the leverage was due to favorable freight rates and specific transportation-related cost savings initiatives we have. We do expect to continue to see freight leverage this year. We're unlikely to get all of the way back to FY 2019 freight expense, as we've previously discussed, but we recently finalized our latest round of domestic freight contracts, and we're pleased with where we landed. Freight should continue to drive expense leverage through all of 2024, and in addition, fuel—diesel fuel rates have begun to become a modest tailwind here. Got it. Thanks. David, just on the balance sheet, in today's release, the convertible notes looks like they've become a current liability in Q1. What's the plan on retiring these? Just wondering also if there's any impact to the stock repurchase program or share count. Sometimes the accounting for converts can be pretty tricky to model. Thanks, John. Appreciate it. Glad you asked about the converts. Good question. Before I answer your question directly, I just wanna, you know, talk about our liquidity. We feel very good about our current liquidity. We ended the quarter with $742 million in cash. We had no borrowings on our ABL and about $1.5 billion in total liquidity. Secondly, you know, we're really comfortable with our total debt levels, and we would expect, as hopefully our EBITDA continues to grow, that our leverage ratios would stay on the healthy trend of improvement we've seen over the last few years. Getting to your question on the 2025 convertible notes, yes, they became a current liability. As of the end of this quarter, there's $156 million outstanding that mature in April 2025. If you recall, John, we, you know, we did an amend and extend convert transaction in 2023, and at that time, it was our intention to ultimately reduce the total amount of converts outstanding on our balance sheet, and we extended $297 million in new convertible notes out to December 2027, you know, while purposely allowing the converts you referenced, the $156 million of the 2025s, to go to maturity. So given the, you know, strong liquidity that I just referenced, we're very comfortable retiring that $156 million in principal with cash on hand next April. And, you know, as you might expect, this is a strategy that we socialized upfront with the rating agencies before we completed the transaction. You know, getting to sort of the heart of your question about buybacks. You know, since we completed the convert transaction last year, we bought back about $164 million in stock between Q4 of last year and Q1 of this year. And we indicated on our last earnings call that we viewed last year's level of buybacks, which was $232 million, as a reasonable proxy or target for buybacks this year. And, as you probably noted in the press release, you know, we have $442 million remaining on our current share repurchase authorization. So look, we know our shareholders value a consistent approach to share repurchases, and our intention would be, given our strong liquidity, as well as what we expect to generate in cash flow, that we would continue to buy back shares consistently, not only in 2024, but 2025 as well, you know, assuming our financial performance continues as we have it planned. Got it. Thanks. Thanks, John. Next question comes from the line of Brooke Roach with Goldman Sachs. Your line is open. Good morning, and thank you for taking our question. Michael, several retailers have recently announced that they're reducing, reducing or sharpening their price and value equation. What impact could these lower prices have on Burlington? And what is your strategy or reaction? Well, good morning, Brooke. Thank you for the question. You're right. It does feel like a number of retailers have recently talked about reducing, sharpening or rolling back their prices. As an off-price retailer, relative value is critically important to us, so we pay close attention to what competitors are saying. You know, that said, there are a few reasons why I think we are in pretty good shape. Firstly, you know, many retailers raised their prices over the last few years. Now that the consumer is pushing back, it's not that surprising that so some retailers are having to roll their prices back. In contrast, we have not raised prices. In fact, our average retails are lower now than they were two years ago. The reason for that is that our core customer has been under significant economic pressure since the end of 2021, so we've had to stay very, very sharp on value. So in other words, I feel like we're already starting from a very strong value position. Secondly, our merchants are in our competitive stores every week: off-price, department stores, specialty stores, e-commerce websites, and other retailers. You know, they're looking through the assortments, the styles, the prices. They're looking at what's working and what's not, and what's left in the clearance rack. As I mentioned a moment ago, with Merchandising 2.0, we have better visibility than we've ever had before into what's on our floor and how well it's turning. That means that we can respond very quickly if we need to make an adjustment. The third and final thing I'd say is that the guidance that we've discussed today already builds in some room in case we need to reduce markup later this year in order to make our values even stronger. It's worth calling out that the Q1 gross margin that we've reported today at 43.5% is a historic record for the first quarter for Burlington. It's even higher than Q1 of 2021. And we're driving those margins by turning faster and taking fewer markdowns. We think we may have more favorability there, but within our guidance, we've left room in case we need to further sharpen our value and pass along that favorability to shoppers. That's really helpful. For Kristin, can you elaborate on that point on the expectations for merchandise margin as you move throughout the year, given some of the puts and takes on markdown versus the year-over-year trend on regular price selling relative to clearance from last year? Thank you. Hi. Sure. No, it's a good question. We certainly saw higher merchandise margin in the first quarter with the lower clearance, faster turns, lower markdowns. Go forward, I'd say we think we do feel like there's an opportunity to continue seeing a faster turn, faster inventory turn and thereby lower markdown. Maybe not as much opportunity on markup, but do feel like we have opportunity going forward on faster turn. We still turn a little bit slower than some of our peers and feel like there's an opportunity there to drive improved merch margin. That's part of that 200 basis points of margin opportunity that's independent of sales that I talked about earlier, a higher merch margin is part of that, really based on a fast return. Great. Thanks so much. I'll pass it on. Next question comes from the line of Alex Straton with Morgan Stanley. Your line is open. Great. Thanks for taking my question. Just firstly, I wanted to dive into new store openings. As you open up new stores, do you think you're attracting new customers to Burlington? And then, if you are, who do you think you are taking these customers from? Good morning, Alex. That's a great question. As we mentioned in the prepared remarks, total sales growth in Q1 was up 11% versus 2023, versus Q1 of 2023, and that itself was on top of + 11% growth versus Q1 of 2022. So obviously, those numbers heavily indicate that we're drawing incremental customers to our stores. That said, you know, Burlington has been around for a long time, and most of our new stores are opening in markets and geographies where we already have a presence. So what we're seeing in our data is that, yes, some of the shoppers walking into our stores are completely new, but many others actually shopped Burlington many years ago. Maybe their mother brought them in to buy a coat back in the day. What's exciting is that when they walk into one of our stores today, it's as if they're walking into a completely different retailer. It feels like a new Burlington, and to all intents and purposes, these are essentially new customers for us. So, yes, one way or another, we believe that our new store opening program is attracting new customers to Burlington. On the last part of your question, you know, where are these customers coming from? Yeah, I would say that there is not one single source. Of course, at a macro level, we can see that there are certain retail formats, such as, you know, department stores and specialty stores, that are struggling and are losing share year- on- year. We don't have specific data, but it seems like a reasonable inference that we must be picking up some of the market share that they are losing. That said, you know, we operate in a large, fragmented and very competitive space with off-price department stores, specialty stores, e-commerce, and other retail formats. We know from our own customer surveys that our customers cross-shop heavily, looking for the best value. So the implication for us is if we offer the best value, then we can draw market share, I think, from a wide range of retail competitors. Great. Maybe just a second one from me. But on the flip side, store closures. It looks like you relocated or closed a lot of stores in the quarter. Can you just provide more color on what was going on there? And then how many additional stores do you think you ultimately need to close or relocate? Thanks a lot. Great. Good morning, Alex. I'll take that one. It's Kristin. It's a good question. We did close or relocate a number of stores in the first quarter. On a net basis, we opened 14 new stores, but we opened 36 gross new stores in the first quarter, which means we closed or relocated 22 stores on our base of a little over 1,000 stores. So for the year, we plan to close or relocate approximately 40 stores, and we'll plan to open about 140 gross new stores. So this means we're moving out of approximately 40 older, oversized stores that tend to be in secondary or tertiary centers. We're moving into higher traffic centers that tend to trade more broadly across income demographics. And this year is really representative of what we plan to do over the next several years as leases expire and new locations in these higher traffic centers become available. And we expect to close or relocate about 150-200 stores over the next 5 years. Thanks so much. Good luck. Thank you. Next question comes from the line of Adrienne Yih with Barclays. Your line is open. Great. Thank you very much, and let me add my congratulations. Great start to the year. Michael, can you comment on the drivers of comp growth in Q1, traffic, AUR, UPT, and then how those sort of transition through the quarter and into the May quarter- to- date? And then, Kristin, my follow-up is on the deleverage that you mentioned on Q1, on store payroll. We're hearing from some other retailers that there's some stability in turnover and maybe, like, average hourly rate gains are slowing. What drove this, and are you expecting that same deleverage through the rest of the year? Thank you very much. Good morning, Adrienne. I'll actually take both of your questions. The first was on the components of comp. So the primary drivers of first quarter comp were both traffic and conversion. Together, the increase in total transactions, that's what really drove the comp in the quarter. Higher conversion is great because it tells us when she comes in our store, she sees the content and value that she likes, and we see that in conversion. AUR was down slightly in the quarter due to mix of business and our continued focus on opening price points. And units per transaction were up slightly. Traffic and conversion improved as we moved through the quarter. As you would expect, I think both metrics were stronger in the March, April period than in February. And then, your second question was on, on store payroll. So, it's a good question. We mentioned it, in the prepared remarks, excluding Bed Bath & Beyond dark rent expenses, SG&A deleverage was 40 basis points, and that was driven primarily by increased investments in store payroll. As a reminder, in early 2023, we thought we had opportunity to improve our customer shopping experience and improve store conditions. We to ensure stores were neat, clean, easy to shop. So to address this opportunity, we made a purposeful investment in store payroll beginning in the back half of last year, and we'll lap this payroll investment in the fall of this year. And typically, you can expect that we see SG&A leverage at around a 3% comp. And I think the last part of your question was around store wages, and we tend to take a market-by-market approach. We plan for, obviously, the legislative increases, but we also plan for competitive and market-related wage increases. And we're seeing stability there, and our approach as a market-by-market seems to be working. Fantastic. Thank you so much, and best of luck. Thanks, Adrienne. Thank you. Our last question comes from the line of Dana Telsey with Telsey Advisory Group. Your line is open. Hi, good morning, everyone, and congratulations on the results. With regards to real estate, two questions: Any update on the Bed Bath & Beyond stores that you took? Are they all open now? How are they doing? And are all the one-time Bed Bath & Beyond expenses behind you? And just secondly, I saw that you picked up some of the 99 Cents Only leases in the bankruptcy auction. Any update or detail on those stores, and are they likely to open this year? Thank you. Good morning, Dana. Yeah, thanks for these questions. It's still early, but we feel very good about the Bed Bath & Beyond stores. As a reminder, we expect that on average, new store sales volumes will be about $7 million in the first full year, and we expect that these Bed Bath & Beyond stores, as a group, will achieve or beat that expectation. Of the 64 Bed Bath locations, we opened 32 last year in fiscal 2023. The majority of those were in the fourth quarter. In the first quarter of this year, we opened 20 Bed Bath & Beyond stores, and we expect to open the remaining 12 in the second quarter. Although it's possible we could have a few stragglers that fall into Q3. As far as the dark rent cost, in Q4 of 2023, associated with Bed Bath were about $6 million, and in all of 2023, fiscal 2023, that cost was about $18 million. In the first quarter of this year, in 2024, those Bed Bath & Beyond dark rent costs were $6 million. And for Q2, we have modeled in the guidance, we expect about $3 million of Bed Bath & Beyond dark rent expense. And then, that after that, it should be largely behind us. And I think your second question was on 99 Cents Only. Yes, it's a good question. We evaluated over 370 store locations that became available in the 99 Cents Only bankruptcy. We really scrutinized these, but really, very few of these sites had the characteristics we're looking for. We're looking for busy strip malls, national co-tenants, strong traffic, sales potential, or nor did many clear our new store financial hurdles. So based on our analysis, we'll likely secure just a handful of these locations. And if we secure these stores, they'll join our pipeline in 2025 or even 2026. So in August, we'll plan to offer a more detailed update as some of the negotiations still ongoing there. Thanks for the question. Thank you. There are no further questions at this time. Mr. Michael O'Sullivan, I turn the call back over to you. Let me close by thanking everyone on this call for your interest in Burlington Stores. We look forward to talking to you again in August to discuss our second quarter 2024 fiscal results. Thank you for your time today. This concludes today's conference call. You may now disconnect.