Good morning, everyone. It's Daniel Hofkin with William Blair. Thank you, everyone, for joining us. This morning, we have with us the management of O'Reilly Automotive. With us today are Tom McFall, CFO, and Mark Merz, and Eric Bird with Investor Relations and Financial Planning. Really thrilled to have you guys back at our conference once again. This should be great. I'm going to just turn it over quickly to Mark for some quick comments, and then we'll kick off the fireside chat. Fantastic. Thank you, Dan. We appreciate you having us today and appreciate everybody taking some time to listen to us this morning. I just wanted to give a quick minute or two about O'Reilly. I know this is more of a general conference, not specific to automotive aftermarket. I just thought I'd give a quick couple of bullet points about the company, and then we'll turn it back over to Dan, and he can kick off the questions for us. O'Reilly started in 1957. We had a single store here in Springfield, Missouri, and we grew to where we are today. We're a specialty retailer of automotive aftermarket parts and supplies. Essentially, we sell parts to keep the 270 million registered vehicles here in the U.S. moving, getting people back and forth to work and to the doctor and to the grocery store every day. As of March 31, we operated 5,660 stores in 47 states here in the United States. We also operate 22 stores in Mexico that came with our acquisition at the end of 2018 of Mayasa Auto Parts. It's been a great acquisition for us. We also operate 28 regional distribution centers, which are extremely important because we place our distribution centers close enough to our stores that we can replenish them. Most of our stores, almost all of our stores here in the U.S., in the continental U.S., receive five nights a week replenishment, which allows us to keep a larger breadth of inventory at the stores and not as much depth. There's a greater chance that we can have the part in stock when the customer calls or walks into our stores every day. We have over 77,000 team members across the country who execute and live our culture values every day. In my opinion, the most important culture value is excellent customer service. That's what our team members do every day. They focus on providing industry-leading service to both our retail do-it-yourself customers, as well as our professional or mechanic service provider customers. That is what we call our dual market strategy, which means we focus equally on both sides of the business. Anyone who needs a part in any way, we're out there taking care of. DIY customers are people like you and I who work on our cars ourselves in our driveways when they're broken. Professional service provider customers or DIFM customers are the mechanics that some of us take our vehicles to when they break down. Our stores carry a very robust inventory, good, better, best on the value spectrum. Every type of part from the entry-level part that, generally speaking, that DIY customer is looking for to the better, best that branded products that the professional service providers or mechanics look for. We also augment this robust inventory that we have in our stores with same-day availability from our over 350 hub stores. Half of our stores in the U.S. have direct deliveries every day from the 28 distribution centers throughout the course of the day. If a customer does come into the store and we don't have that hard-to-find part that we're looking for, we keep inventory close enough to the stores that we can get it to that customer many times on a same-day basis, which is extremely important to help them get their lives back in order, which is ultimately what we do. We help them get their cars fixed so they can get their lives back in order. With that real quick overview, Dan, I'll turn it back over to you, and you can fire away with your questions. Great. Thank you. Very helpful. Just kicking off a couple of questions here. I guess maybe to begin with, what would you say enabled your two segments, your two businesses to perform so well in 2020, despite what was a sharp drop in miles driven? How should people think about the backdrop as we emerge from the pandemic with rising miles driven, also rising gas prices, other factors like vehicle age, etc.? How can O'Reilly continue to comp in each segment in the near term, would you say? 2020 was a crazy year by all standards. When we look at the specifics of the question you asked, miles driven is an important statistic for our industry. As cars are driven more and more cars are on the road, more parts need to be repaired. Ideally, the best stat for us would be miles driven on cars outside of warranty, because if it's in warranty, the dealer is going to repair most items outside of maintenance items. When cars hit five years, that's when you start seeing more failures and repairs happening. When you look at those miles driven, they didn't dip as much just because that statistic by itself isn't out there. With the new car sales being down from just demand and lack of supply, more of the miles driven were on older cars. That was a positive for us. When we look over a short period of time and we see big swings in our industry, they're primarily driven by two things. One is weather, and two is customer behavior. I'd say weather was pretty normal last year. On the customer behavior, there's a huge amount of unperformed or underperformed maintenance on the vehicle fleet at any time. Customer sentiment about their vehicle and their economic health are drivers of whether that pool of unperformed or underperformed maintenance goes up and down. It's estimated to be $50 billion by our industry. Whether that's exactly the right number, hard to know, but it is a big number. What we see when we go into economic downturns and people get the expectation that they're going to keep their vehicle longer, they repair it more and keep it more up to date. I think that's also something we saw last year where people were concerned about their economic health and wanted to maintain better the vehicle that they had. The last item is there was a lot of stimulus money out there with the people who had time to work on their cars. Because of that, we saw a bigger demand on the DIY side of the business and bigger growth in the DIY side of the business. We had about four weeks between kind of the start of the pandemic when markets started to close down and for stimulus checks that where businesses were out. We were down about double digits. As soon as those stimulus checks hit, we saw a business spike. On the professional side of the business, a different dynamic there. People weren't out traveling. Those customers tend to be more affluent, more likely to have a work-from-home job. People were just concerned about having someone else in their vehicle. The professional business was slower to return and had what we would say overall is an average year. They were down for longer and then rebounded in the third and fourth quarter, and that momentum has continued. It is hard to parse all that out into the demand that we had, but those are, from our perspective, the major drivers in 2020. When we look at 2021, what happens with gas prices is to be determined whether they're temporarily up or going to be up. As the economies have reopened and people have got out and started to move around, we see miles driven increase, and that's a positive for us. How much increase in gas prices curtailed people's driving? It's a pretty low bar by comparison. We expect that in aggregate to be a tailwind. We're also watching closely the new car sales. Used car prices are at record highs, which tend to indicate that there is a shortage of vehicles. People are valuing their used vehicles more. They're going to do more repairs, which is a positive for us. Over the next couple of years, we'll be watching the number of vehicles on the road to see if there's an increase as people potentially want to control more of their own transportation. As we saw during the pandemic, public transit was not an option for most people. Ridesharing was a concern. People want to be prepared if there's another concern. Where do people live? Does that change miles driven along with some work-from-home arrangements? We'll see how that impacts miles driven. Ultimately, if there are more cars on the road driving more miles, that will be good for our industry. On your question on how do you grow your professional side of the business and your DIY side of the business, it's great when there's more demand in our market. On both sides of the business, we are a small portion of the overall industry. It is the good old-fashioned go out and provide great customer service to every customer and go out and win customers and gain share. Can you talk about the near-term cost environment, things like labor, freight, et cetera, how you're managing through it? On the retail price end or retail or DIFM price trend, what type of inflation you're seeing currently? How do you expect that to play out over the remainder of 2021? We're seeing more inflation than we expected. We talked about that on the first quarter call. As supply chains are constrained, we're seeing pressure on labor. Although the unemployment numbers are not as low as they were, participation is down. It's hard to find good people who are interested in coming to work. We would expect to see continued pressure on both sides. Fuel costs are up. Transportation costs are up. We're going to have to manage through that. Historically, when we've seen our acquisition cost of product go up as an industry, we've been pretty effective at passing those through to price. When the tariffs were put into effect in 2018 and 2019, you saw those come through to price on the street for both the professional and the DIY customer. I think you're muted, Dan. Thanks, Mark. Assuming that some of the cost pressures, labor availability eases up later in the year, do you expect that to be an important factor in particular? When we look at our cost structure, we have a relatively high cost structure as a multi-unit specialty retailer. We've always been very stringent in how we manage our costs. When we look back to 2020, at the onset of the pandemic, no one knew how long it was going to last or how severe it was going to be. We, along with others, adjusted our staff to what we thought the business would be. The business turned around and ended up really being understaffed for the year and running too thin a payroll. We kept waiting for the stimulus to wear off or the additional unemployment benefits to stop and for business to slow down. We didn't want to be overstaffed for that. We were slow to add staff back. Today, we tell you we're still running too lean on payroll. We try to manage our expense structure over the long term. We'll run a little bit leaner now. If those abate, if business slows, we'll be in a position to manage our cost structure. Okay. In terms of you talked about, or I believe a couple of competitors have talked about making some investments in price, particularly on the DIFM side of the business. Can you talk about what you're seeing specifically in that segment? There are some interesting comments out there and specific categories that are very strategic to drive increasing gross margin dollars that aren't quite made, not in relation to our direct mainline competitors, I think is the tagline. The commercial business has always been very competitive, and people run different deals, whether they're big players or small players. We try to be very thoughtful about our pricing, and we are never going to run a price that we can't continue to sustain. If you try to go out and buy the business, it's hard to keep it at a reasonable cost. We've always focused on service first and a reasonable price second. That said, we are competitive. We're not going to lose business because someone is going to take price way down. Typically, that involves the supplier and a chain of negotiations and discussions there. It also depends on what price you started from. If you were too high to begin with and you got down to where market is, you're investing in price and potentially taking some share, but maybe not setting a new lower market price. We would tell you that we will always be competitive on the street, whether it's professional or DIY. For us, we always have in our history and always will lead with service. I talked in the beginning about the robust distribution infrastructure, the types of parts that we carry, the replenishment that we have with our stores, the same-day availability from the hub stores' networks directly from the distribution centers. At the end of the day, it's all about service. Like Tom said, we're going to be price competitive, but we're not going to lead with price. We're going to lead with service. That's our culture. On the professional side of the business, specific to your question, and Tom mentioned it when he answered the first question, this industry is very fragmented, especially on the commercial side. There are 37,000 parts stores out there, and the top 10 chains only have about half of those locations, with the top four having a big piece of that. There is lots and lots and lots of opportunity out there to gain market share. The way you gain and keep a customer is providing consistently excellent service every day. If you have the competitive price and you're head and shoulders to head with service, that's how you keep and maintain business and grow those gross profit dollars and operating profit dollars over the long term. That's what we focus on as a company. Can you talk about beyond this year, what are your thoughts about the industry backdrop over the next few years in terms of some of the main variables that you watch and how you think about O'Reilly 's opportunity to continue to gain share, grow comps, grow the domestic store base, where you see that getting to, and also operating margins? OK, lots of questions in there. We would expect employment to continue to improve over the next few years. As we talked about, we'll be watching the number of new vehicles and vehicles on the road, and we expect that to be a tailwind. Oil prices and weather can be a wild card in there. As gas prices spike, we'll see people work to not drive. They're temporarily up now. Maybe it's permanent. We shall see. As I talked about, there is a lot of share out there that is controlled by companies that aren't O'Reilly, and our job is to go out and continue to provide great customer service and win customers. That's what we've done for our career. We expect to continue to do that. We still see a lot of great growth opportunities. How many stores we open each year, we backed off the last few years of development, spent harder during COVID to get all the work done and people staffed and inspectors out there to approve buildings. Lower number this year, we're still looking to see how development goes for next year. On operating margins, I know that most of the people on this call use a lot of percentages in their models, and there's been a lot of discussion of percentages here over the last two, three quarters. Our job and our company goal is to continue to profitably grow our business. That means improving our operating profit dollars year over year. We've been very successful in that, and that's what we will focus on continuing to do. I think you did it again, Dan. First meeting of the day. Yeah. No, just wanted to make sure there's no background noise here. Thanks for the heads up. Can you talk a little bit about electric vehicles over time, how those will factor in in terms of the industry dynamics and also O'Reilly specifically? Sure. Is there any other sort of longer-term curveballs or concerns that you might have? Sure. Electric vehicles are somewhat of a wild card. They make up a very small segment of the new car sales each year and a very small segment of the population. They continue to evolve. The technology continues to change. Different companies continue to pop up and make different versions of electric vehicles. Obviously, Tesla is the main provider of electric vehicles today or all electric vehicles. There are a lot of limitations to those as far as cost. They're expensive in aggregate, although they have some models that they tout as being low priced. I think I read somewhere that the average Tesla that rolled off the assembly line last year sold for $69,000. That's pretty high for the general usage. There continues to be a lot of discussion about the weight to energy ratio of batteries and how to increase that over time and increase mileage to make the vehicles more acceptable in more applications. It continues to evolve. Even if we had the right electric vehicle solution tomorrow, we don't have the electrical grid infrastructure to support that many cars being charged. It's going to evolve over time. Right now, hybrids are a much better solution or much more sales and more uses. For us, that's good. They have electric parts and gas parts. When we look at the core of what we do, we are here to provide a service to our professional installers who exist because there are not enough service bays at the dealerships to service the entire fleet. The OE dealers are not as cost-competitive as other options. That's why the professional business exists. We're here to support those businesses and their parts and equipment and technology and training needs. On the DIY side of the business, people are fixing their own cars because they can't afford to have somebody else fix their cars. Although it would be great to have everybody be that affluent, that does not look like it's going to happen any time soon. The real drivers for why our company exists will continue no matter what powertrain exists in the vehicles. We get a lot of questions about what's our content for an electric vehicle. It's hard to know because we don't really know what the Model T looks like for an electric vehicle. In the meantime, we continue to work with our major suppliers who are also OE suppliers and work in a lot of these technologies to come up with new solutions and how our DIY and professional customers can continue to work on advanced technology. This will be a change that happens over a long period of time. Cars that roll off the assembly line right now are going to be on the road for 19 or 20 years. The population changes very slowly. We continue to adapt to the new technologies that are coming out in vehicles to provide those professional customers what they need to have their businesses be successful and for DIY folks to keep their cars on the road and economical cost. You may have mentioned this briefly, but any concerns about within electric vehicles that the OEM dealers or the manufacturers themselves will want to do more of the servicing themselves to the degree that there are replacement parts as a part of electric vehicles? The OE dealers definitely want to service the vehicle fleet. The issue is there's just not enough bays. The last major move in dealerships was to reduce the number of dealerships. Tesla runs a totally different program. They will continue to be a competitor, and we have to provide a great value to our customers to turn their business. Dan, the reason the aftermarket exists today is years ago, there were too many vehicles for the dealerships to service. Independent mechanics, many of them who were mechanics for the OE dealerships, went out and started their own shops, their own business. They became entrepreneurs, wanted to control their destiny. Today, the size of the vehicle fleet compared to the size of the dealership network is absolutely upside down. That is why all the independent mechanics exist out there. That is why the automotive aftermarket exists out there. Companies like us not only provide the parts to those mechanics who work on those vehicles, but we also provide training into the aftermarket. We do thousands of training classes a year, evenings and weekends, where mechanics will bring in supplier reps, and they'll teach the mechanics the new changing technology on the vehicles. We play an important role in ensuring that, and some of our competitors as well, ensuring that the aftermarket can work on whatever the changing technology is in the vehicle fleet, electric vehicles, hybrid vehicles, synthetic fuel, internal combustion, whatever it is. Like Tom said, it's a very, very slow turn. The vehicles that are rolling off the line today aren't our core customer today. When they fall off of warranty five, six, seven years down the road and things begin to fail, is when they become a larger customer for us. We certainly sell parts to vehicles that are under warranty, but they're more maintenance-type items. When those parts begin to break, of course, warranty is when they become our core customers. We will see whatever the changing technology is, just like we saw it back in the 1980s when the first computer modules were on vehicles, the aftermarket adapted. Because of the long runway, we'll have plenty of time to prepare for whatever the vehicle technology is to make sure we have the parts that both our DIY and DIFM customers need to service them. Can you give us maybe a little update on the Mayasa Auto Parts acquisition in Mexico, how you're thinking about the Mexican market in the near term, and also as a longer-term growth platform for O'Reilly? Eric handles a lot of the Mayasa financials, so it sounds like a great question for Eric. We've been very pleased with how they performed all along. That was intended to be a good platform, good learning opportunity for us to come down and partner with the management team that shared our culture and our values, and they're very much that. COVID has certainly hindered our ability to get down there, have our teams go down and travel and partner with them, but we've still been making great progress on the acquisition and have big plans for Mexico and remain very optimistic about the opportunities down there. Any thoughts on how that market is similar and/or different than the U.S. market, and also more broadly other potential non-U.S. markets over time? There's some big similarities within the vehicle fleet, which is one of the reasons that pushed us to primarily look down to Mexico for our first international expansion opportunity. Yes, and overall, similar, a lot of DIY, DIFM, there is a little bit of differences between how we think about some of our DIFM customers down there. The Mayasa Auto Parts business currently runs a very large Jobber business, which is something that was very prevalent here in the U.S., and since we've acquired a lot of Jobber customers and consolidated that side of the business, probably a little bit of a step behind from that perspective. Certainly, it continues to be opportunity on both DIY and DIFM down there. Great. I think final question that we'll probably have time for is something that we're asking of all our companies. Can you just kind of review your efforts on the whole ESG front? Sure. We're very, very happy that we're working on our third annual sustainability report. From an ESG standpoint, I know that term has come up in recent years from O'Reilly Automotive. Those items have always been a part of our culture, focusing on the environment, focusing on our team, which is our most important asset, and having fantastic governance. We've always executed an ESG platform. In the last several years, there's been more focus on reporting around it. We issued our initial ESG sustainability report in 2019. We issued our second one in November of 2020. We're currently working on our third one, which we hope to issue this fall. The first report was more focused on the E in ESG, the environment, because our engagement with our stakeholders and shareholders that year was more focused on environment. The second year, it was more focused on diversity and inclusion because that was the engagement that we had. Talked about our training programs, our development opportunities, promote from within our organization. This year's report will likely continue to be more focused on diversity and inclusion. We've got some exciting new information that we'll have in that report. Can't disclose what all of it is now, but it will be more focused on the diversity and inclusion side of the ESG spectrum when that report is released. Great. Folks, thank you, Tom, Mark, and Eric, for joining us and taking time out of your schedules to meet with our investors. Thank you to everyone else joining this conference call. We will let you guys get on to the next set of meetings. Best of luck, and thanks, everyone. Have a good conference. Thank you, Dan. Thank you, Dan. We appreciate you hosting us. Thanks, everyone.