Thomas W. Dickson, Chairman of the Board and Chief Executive Officer stated, “We are very pleased with our results for the quarter. Our pricing and promotional strategies continue to be effective in driving unit sales, customer visits and increasing market share. Our operating profit margin improvement for the year was driven by the reduction in our selling, general and administrative expense margin realized through the leverage created from the additional sales and our emphasis on cost controls. We believe these positive results are a result of our continuing commitment to our customers to deliver outstanding values and excellent customer service.”
The Company’s operating performance and strong financial position provides the flexibility to continue with its store development program for new and replacement stores along with the remodeling and expansion of existing stores. Capital expenditures for fiscal 2012 are planned to total approximately $215 million. During the remainder of fiscal 2012, the Company plans to open four new stores and complete major remodels on ten stores, five of which will be expanded in size. The remaining store openings for fiscal 2012 are expected to include three in the third quarter (one of which is a replacement for a store closed in the first quarter) and one in the fourth quarter. The new store development program for fiscal 2012 is expected to result in a 3.9% increase in retail square footage, as compared to a 3.2% increase in fiscal 2011. The Company routinely evaluates its existing store operations in regards to its overall business strategy and from time to time will close or divest underperforming stores.
The Company’s capital expenditure plans entail the continued expansion of its existing markets, including the Washington, D.C. metro market area which incorporates northern Virginia, the District of Columbia, southern Maryland and coastal Delaware. Real estate development by its nature is both unpredictable and subject to external factors including weather, construction schedules and costs. Any change in the amount and timing of new store development would impact the expected capital expenditures, sales and operating results.