Welcome to Bed Bath & Beyond's First Quarter of Fiscal 2012 Results Conference Call. [Operator Instructions] This conference is being recorded. A rebroadcast of the conference call will be available beginning on Wednesday, June 20, 2012, at 6:30 p.m. Eastern Time through 6:30 p.m. Eastern Time on Friday, June 22, 2012. To access the rebroadcast, you may dial 1 (888) 203-1112 with the passcode ID of 9470163. At this time, it's my pleasure to turn the conference over to Mr. Gene Castagna, Chief Financial Officer and Treasurer of Bed Bath & Beyond. Please go ahead, sir. Eugene A. Castagna: Thank you, and good afternoon. Welcome to Bed Bath & Beyond's First Quarter of Fiscal 2012 Conference Call. A short time ago, we issued a press release announcing Bed Bath & Beyond's results for the 3-month period ended May 26, 2012. During this call, we will comment on some of the first quarter highlights and update our second quarter and full fiscal year 2012 planning assumptions. Before proceeding, I will read the following statement and I quote, "Bed Bath & Beyond's fiscal first quarter press release and comments made during this call may contain forward-looking statements within the meaning of Section 21E of the Securities & Exchange Act of 1934 as amended. Many of these forward-looking statements can be identified by the use of words such as may, will, expect, anticipate, approximate, estimate, assume, continue, model, project, plan and similar words and phrases. The company's actual results and future financial condition may differ materially from those expressed in any such forward-looking statements as a result of many factors. Please refer to Bed Bath & Beyond's SEC filings, including its Form 10-K for the year ended February 25, 2011. The company does not undertake any obligation to update its forward-looking statements." Joining me on today's call are Leonard Feinstein, Co-Chairman of Bed Bath & Beyond; and Steven Temares, Chief Executive Officer and member of the Board of Directors. I'm now very pleased to introduce Leonard Feinstein. Len?

Thanks, Gene, and good afternoon. We are pleased to report our company's fiscal first quarter net earnings per diluted share of $0.89, an increase of approximately 24% over last year's fiscal first quarter. We are also pleased that during the quarter, we entered into a definitive agreement to acquire all of the outstanding shares of Cost Plus, Inc., a retailer selling a wide range of home decorated items, furniture, gifts, holiday and other seasonal items and gourmet food and beverages. And subsequent to the end of the first quarter, we completed the acquisition of Linen Holdings, LLC, a business-to-business distributor of a variety of textile products, amenities and other goods. We are extremely excited about the opportunities provided by these acquisitions. In a few minutes, Steven and Gene will also provide some additional information regarding these transactions. Other first quarter activities included the opening of 2 Bed Bath & Beyond stores, 4 buybuy BABY stores and 1 Christmas Tree Shops stores. Additionally, we continue to relocate and renovate Bed Bath & Beyond stores. Consolidated store space at May 26, 2012, was approximately 36.3 million square feet, an increase of approximately 3% over the end of last year's first quarter. Since the beginning of the fiscal second quarter of 2012, we have opened 2 additional Bed Bath & Beyond stores and 3 additional buybuy BABY stores. Including these stores, we currently operate 1,185 stores, consisting of 997 Bed Bath & Beyond stores in all 50 states, the District of Columbia, Puerto Rico and Canada; 72 Christmas Tree Shops stores; 71 buybuy BABY stores; and 45 stores under the names Harmon or Harmon Face Values. In addition, we are a partner in a joint venture which operates 2 stores in the Mexico City market under the name Home & More. During fiscal 2012, including the 12 additional stores we have opened to date, we anticipate opening a total of approximately 40 stores across all our concepts, excluding Cost Plus World Market stores, as the transaction has not yet been completed. Currently, we believe that fiscal 2012's mix of store openings by concept will be relatively comparable to that of fiscal 2011. As the year progresses, the total number of stores that we will open will be updated as we gain greater visibility. As always, we apply our stringent standards to growth as we evaluate new store sites, as well as continue to review our existing locations and lease terms for opportunities to relocate and/or rightsize our stores in response to changing market conditions. We believe that throughout the United States and Canada, again, excluding Cost Plus World Market stores as the transaction has not yet been completed, there is an opportunity to operate an excess of 1,300 Bed Bath & Beyond stores, as well as grow our Christmas Tree Shops and buybuy BABY concepts from coast to coast. Additionally, we will continue to open Harmon Face Values stores and place health and beauty care offerings in selected stores across all of our concepts, as well as World Market food departments in selected Bed Bath & Beyond stores. We remain committed to and are excited about the continued growth of all our merchandise categories. We are focused on increasing the productivity of our existing stores by evolving the merchandise offerings, as well as by expanding, renovating, and/or relocating stores to enhance our customer shopping experience. Our ability to leverage the breadth and depth of our merchandise offerings, to grow our bridal, baby and gift registries and to continue the development of our interactive platform has afforded us additional opportunities to attract new customers. As we have consistently said, the success of our company is due to the tremendous efforts of our associates and to our unique decentralized culture. This culture, which takes advantage of the knowledge, the independence and the customer focus of our associates, has always been the foundation of our long-term performance and allows us to respond more quickly to market demands and to changing economic conditions on a market by market basis. We have the people, the resources and the capability to achieve our near- and long-term goals. And now I'll turn the call over to Steven Temares. Steve? Steven H. Temares: Thank you, Len. Good afternoon, everyone, and thank you for participating in this conference call. We are pleased that we have been able to continue our strong performance in terms of earnings growth, cash flow generation, and overall financial strength. We believe the dedication and talents of our associates and their constant focus on improving the overall customer shopping experience, while at the same time creating a more productive and efficient company, are the keys to producing the strong results we have experienced. Despite the ongoing economic challenges that are affecting consumers, our fundamental business strategy remains unchanged: to offer a broad assortment of merchandise at everyday low prices with superior customer service. As always, we will continue to invest in all aspects of our company and work to enhance our customer's overall experience in store, online and through mobile devices and social media. We remain committed to being our customer's first choice for the merchandise categories we offer domestically, interactively and over the longer term, internationally. We are confident that our company is well positioned to grow profitably, compete for, and increase our market share and to grow shareholder value over time. In taking this long-term approach to the growth and development of our business and through the ongoing efforts to cross-merchandise and leverage our best practices throughout our organization, we expect over time to do more for and with our customers. Turning to our fiscal first quarter of 2012 performance, as reported earlier today, our net earnings per diluted share were $0.89, an increase of approximately 24% when compared to the $0.72 per diluted share that we earned in last year's first quarter. Net sales for the fiscal first quarter were approximately $2.2 billion, approximately 5.1% higher than in the prior year. First quarter comp store sales increased by approximately 3% compared with an increase of approximately 7% to last year. The increase in comp store sales for the fiscal first quarter was attributed to increases in both the number of transactions and the average transaction amount. Gross profit for the fiscal first quarter was approximately 40% of net sales compared to approximately 40.6% of net sales for the first quarter of 2011. This decrease in the gross profit margin as a percentage of net sales was primarily attributed to an increase in coupons, due to increases in both the redemptions and the average coupon amount, as well as a shift in the mix of merchandise sold to lower margin categories. Selling, general and administrative expenses for the fiscal first quarter were approximately 25.9% of net sales as compared to approximately 26.9% of net sales in last year's fiscal first quarter, a decrease of approximately 100 basis points. This decrease can primarily be attributed to lower payroll and payroll-related expenses and occupancy expenses as a percentage of net sales, both of which benefited from the positive comp. Reflecting the movements in gross profit margin and SG&A expenses, the operating profit margin for the fiscal first quarter was higher than in the same period a year ago by approximately 40 basis points. Our provision for income taxes continues to fluctuate as taxable events occur and exposures are reevaluated. For the fiscal first quarter, our provision for income taxes was approximately 33.8% compared to approximately 37.6% for the comparable quarter last year, a decrease of approximately 380 basis points. These provisions included net after-tax benefits of $14.6 million this year and $3.8 million last year due to distinct tax events occurring during these periods. Capital expenditures for the fiscal first quarter of 2012 were approximately $70.8 million, principally for new stores, existing store improvements, information technology enhancements and other projects important to our future. While we continue to review and prioritize our capital needs, we remain committed to making the required investments in our company to help position us for our long-term success. As Len said, we announced on May 9, 2012, that we've entered into a definitive agreement to acquire all of the outstanding shares of Cost Plus, Inc., a retailer selling a wide range of home decorating items, furniture, gifts, holiday and other seasonal items, and gourmet food and beverages. We expect the tender offer for Cost Plus' outstanding shares to be completed during our fiscal second quarter. Additionally, on June 1, 2012, subsequent to our fiscal first quarter, we completed the acquisition of Linen Holdings, LLC, a business-to-business distributer of a variety of textile products, amenities and other goods to customers in the hospitality, cruise line, food service, health care and other industries. We welcome all of our new associates, customers and suppliers to the Bed Bath & Beyond family Both of these companies are run by experienced management who will enable us to enhance our combined operations going forward. We are excited about these acquisitions and their potential for furthering our mission of doing more for and with our current and prospective customers. Our company's Board of Directors continues to review our capital structure on an ongoing basis. In addition to providing value to our shareholders through share repurchase programs, our strong operations should allow us to continue to invest in our infrastructure and maintain our flexibility to take advantage of opportunities as they may arise. As always, we want to thank our associates for their ongoing efforts, which produce Bed Bath & Beyond's long-term success. Through their efforts, we look forward to meeting the challenges that lie ahead and to seizing the opportunities to satisfy our customers and by doing so, continuing our competitive position in the merchandise categories that we offer. I'll now turn the call back to Gene. Gene? Eugene A. Castagna: Thanks, Steve. As you heard from Len and Steve, we earned $0.89 per diluted share in our fiscal first quarter. While we are encouraged by our positive fiscal first quarter results, we continue to be cautiously optimistic about the remainder of the coming year. The following are the planning assumptions for the remainder of fiscal 2012, which consist of 53 weeks and exclude Cost Plus, Inc. as the transaction has not yet been completed. One, the benefit from the results of operations for Linen Holdings is included in our modeling. However, it did not have a material effect for the fiscal second quarter or for all of fiscal 2012. Two, including the 12 stores opened so far this year, we anticipate opening a total of approximately 40 stores across all of our concepts. Currently, we believe that fiscal 2012's mix of store openings by concept will be relatively comparable to that of fiscal 2011. As the year progresses, the total number of stores that we will open will be updated as we gain greater visibility. As always, we remain flexible to take advantage of real estate opportunities that may arise. Also, we will continue to place Harmon Face Values health and beauty care offerings in selected stores across all of our concepts, as well as add World Market food departments in selected Bed Bath & Beyond stores. Three, we expect to continue our program of relocating, renovating and expanding a number of our stores in fiscal 2012. Four, capital expenditures for fiscal 2012 are planned to be in the range of $275 million to $325 million, which, of course, remain subject to the timing and composition of the projects, including new stores and existing store refurbishments, information technology enhancements and other projects important to our future, including the following major initiatives: the development of an enhanced website experience for our customers; the opening of a new 800,000 square-foot e-commerce fulfillment center in Pendergrass, Georgia; the relocation of our Farmingdale and Garden City, New York offices to our corporate headquarters in Union, New Jersey; and the initial phase of a new IT data center to support our ongoing technology initiatives. Currently, we estimate the incremental operating costs associated with these major initiatives to be approximately $0.09 per diluted share occurring primarily in the second half of fiscal 2012. Five, we are modeling a 2% to 4% increase in comparable store sales for the second quarter and full fiscal year. Six, taking into account the 53rd week in fiscal 2012, we are modeling consolidated net sales to increase by 5% to 7% for the second quarter and 6% to 8% for the full fiscal year. Seven, depreciation for fiscal 2012 is expected to be approximately $180 million to $190 million. Eight, assuming these sales levels and modeling advertising events that are relatively consistent with last year, in addition to the continuation of the shift in the mix of merchandise sold to lower margin categories, and including the incremental operating costs associated with the previously discussed major initiatives, we are modeling operating profit margin as a percent of net sales to deleverage for the second quarter and slightly deleverage for the full year. Nine, the second quarter and full year tax provisions are estimated to be in the mid- to high 30s percent range, with expected variability as distinct tax events occur. Ten, we expect to generate positive operating cash flow and continue to fund operations entirely from internally generated sources. Eleven, we plan to continue to repurchase shares under our current $2 billion repurchase program, which we anticipate completing by the end of the fiscal year. Our share repurchase program may be influenced by several factors, including business and market conditions. Based on these and other planning assumptions, we are modeling net earnings per diluted share to be approximately $0.97 to $1.03 for the fiscal second quarter of 2012. For all of fiscal 2012, including the benefit of the 53rd week and the incremental operating cost from the previously discussed major initiatives, we continue to model net earnings per diluted share to increase by a high single-digit to a low double-digit percentage range over fiscal 2011. While our planning assumptions do not include the results of Cost Plus, Inc., in the event that the tender offer is completed as anticipated during the fiscal second quarter, we expect the inclusion of Cost Plus, Inc.'s results would impact our previously discussed modeling as follows. One, in our fiscal second quarter, net earnings per diluted share, including transaction and integration costs, would decrease by several cents. Two, in our second half of fiscal 2012, net earnings per diluted share, including integration costs, would increase and be slightly accretive. Three, for fiscal year 2012, net earnings per diluted share would remain in the range of a high single-digit to a low double-digit increase over fiscal 2011. Four, the acquisition will not impact our plan to completion of the current share repurchase program by the end of fiscal 2012. As always, the share repurchase program may be influenced by several factors, including business and market conditions. Before concluding this afternoon's call, a few additional comments relative to our recently concluded fiscal first quarter, which, as a reminder, due to the timing and status, do not include the results of Linen Holdings and Cost Plus. Our balance sheet and cash flows remains strong. We ended the fiscal first quarter with cash and cash equivalents and investment securities of approximately $1.8 billion. Assuming the completion of the Cost Plus transaction in our fiscal second quarter, we would expect the cash used in our fiscal second quarter for both the Linen Holdings and Cost Plus acquisitions to be approximately $650 million. As of May 26, 2012, inventories at cost were approximately $2.2 billion or $60.63 per square foot, an increase of approximately 2.4% on a per square foot basis over the end of last year's first quarter. Inventories continue to be tailored by store to meet the anticipated demands of our customers and are in good condition. Consolidated shareholders equity at May 26, 2012, was approximately $3.9 billion, which is net of share repurchases, including the approximately $306 million, representing approximately 4.6 million shares repurchased during the fiscal first quarter of 2012. As of May 26, 2012, the remaining balance of the share -- of the current share repurchase program authorized in December 2010 was approximately $613 million. As a reminder, our next conference call to review operating results for the second quarter ending on August 25, 2012, will be on Wednesday, September 19, 2012. If you have any questions, Ken Frankel and I will be in our offices this evening, June 20, to take your calls. As always, we appreciate your interest in Bed Bath & Beyond.

Ladies and gentlemen, this concludes today's conference call. Thank you for listening. You may now disconnect.