Welcome to Bed Bath & Beyond's First Quarter of Fiscal 2013 Results Conference Call. [Operator Instructions] This conference is being recorded. A rebroadcast of the conference call will be available beginning on Wednesday, June 26, 2013, at 6:30 p.m. Eastern Daylight Time through 6:30 p.m. Eastern Daylight Time on Friday, June 28, 2013. To access the rebroadcast, you may dial (888) 843-7419 with the passcode ID of 35107337. 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 2013 Conference Call. A short time ago, we issued a press release announcing Bed Bath & Beyond's results for the 3-month period ended June 1, 2013. During this call, we will comment on some of the first quarter highlights and update our second quarter and full fiscal year 2013 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 March 2, 2013. 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 $0.93 compared to $0.89 per diluted share in last year's fiscal first quarter. As we said on our prior quarter's call, last year's fiscal first quarter included approximately $0.06 per diluted share of distinct net tax benefits. This year's first quarter distinct net tax benefits were approximately $0.01 per share. These results continue our consistent performance in terms of earnings per share growth and overall financial strength. During the quarter, we continued the integration of World Market and Linen Holdings and made good progress on our major initiatives that we mentioned last quarter. Steve will discuss these items in a few minutes. Our other first quarter activities included the opening of 4 Bed Bath & Beyond stores, 2 World Market stores, 1 buybuy BABY stores, 1 Harmon Face Values store as well as closing of 1 Christmas Tree Shops store. Additionally, we continue to relocate and renovate stores across our concepts. At June 1, 2013, consolidated store space including the 266 World Market stores was approximately 42.2 million square feet, an increase of approximately 16% over the end of last year's first quarter. Since the beginning of the fiscal second quarter of 2013, we have opened an additional buybuy BABY store. Including this store, we currently operate 1,479 stores, consisting of 1,008 Bed Bath & Beyond stores in all 50 states, the District of Columbia, Puerto Rico and Canada; 266 World Market stores, 84 buybuy BABY stores, 73 stores under the names Christmas Tree Shops or andThat! and 48 stores under the names Harmon or Harmon Face Values. Including the 9 additional stores we have opened so far, we now anticipate the number of store openings across all our concepts in fiscal 2013 to be in the mid-30s. Additionally, we will continue our program of renovating or relocating stores where deemed appropriate. We also remain flexible to take advantage of real estate opportunities that may arise. As the year progresses, the total number of stores that we will open will be updated as we gain greater visibility. Of course, we do not anticipate the timing shift of our new store openings will affect this year's earnings guidance or our long-term profitability. 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, there is an opportunity to operate in excess of 1,300 Bed Bath & Beyond stores as well as grow our World Market, Christmas Tree Shops or andThat! 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 specialty food and beverage departments in selected Bed Bath & Beyond stores. We remain committed to and are excited about the continued growth of all our merchandise categories. In addition, we are a partner in a joint venture which currently operates 3 Bed Bath & Beyond stores in the Mexico City market. The joint venture plans to open 2 additional Bed Bath & Beyond stores in Mexico during fiscal 2013. As we have consistently said, the success of our company is due to the tremendous efforts of our associates and through 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 believe 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. As Len said, we are pleased that we've been able to continue our consistent performance in terms of earnings per share growth and overall financial strength as well as the key integrations of both World Market and Linen Holdings. We are grateful for the dedication and talents of all our associates and their constant focus on improving the overall customer experience while at the same time creating a more productive and efficient company, which are the keys to producing the strong results that we have experienced. On an ongoing basis, we continue to increase and differentiate our merchandise assortment to better serve our customers needs and shopping preferences. We also continue to invest in all aspects of our company and work to enhance our customers' overall experience in the store, online and through mobile devices and social media. And we remain committed to being our customer's first choice for the merchandise categories we offer domestically, interactively and over the longer term, internationally. By offering a broad, deep and differentiated assortment of merchandise with superior customer service, we are confident that our company's well positioned to grow profitably and increase our market share and shareholder value over time. During this fiscal year, we are advancing several major initiatives, which will require incremental capital investments and SG&A expense, including enhancing our omnichannel experience for our customers by replacing both back-end and customer-facing systems for our websites. We have successfully launched a new buybuy BABY website in early June, and as we said in our last call, remain on track to launch the new Bed Bath & Beyond website by the end of our fiscal second quarter. By upgrading our mobile sites and apps, by enhancing network communications in our stores as well as implementing point-of-sale improvements and by growing and developing of our IT, analytics and e-commerce groups to lead our omnichannel initiatives and evolve our marketing so as to take advantage of the opportunities to personalize our offers to our customers. Also this year, we will be building, equipping and staffing our new IT data center in North Carolina to enhance our disaster recovery capabilities and support our overall IT systems. And we will be retrofitting energy-saving equipment in our stores to allow us to run them more efficiently. Turning to our fiscal first quarter of 2013 performance. As reported earlier today, net earnings per diluted share were $0.93 compared to $0.89 per diluted share in last year's fiscal first quarter. As Len mentioned, last year's fiscal first quarter included approximately $0.06 per diluted share of distinct net tax benefits. This year's first quarter's distinct net tax benefits were approximately $0.01 per diluted share. Net sales for the fiscal first quarter were approximately $2.6 billion, approximately 17.8% higher than in the prior year. Of this increase, approximately 68% was the result of the inclusion of World Market and Linen Holdings, approximately 24% was attributable to the increase in comp store sales and the remaining 8% resulted primarily from new stores. First quarter comp store sales increased by approximately 3.4% compared with an increase of approximately 3% 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 39.5% of net sales compared to approximately 40% of net sales for the first quarter of 2012. 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. The inclusion of World Market and Linen Holdings did not have a material effect on our gross profit percentage. Selling, general and administrative expenses for the fiscal first quarter were approximately 27.2% of net sales as compared to approximately 25.9% of net sales on last year's fiscal first quarter, an increase of approximately 130 basis points. This increase can primarily be attributed to higher payroll and payroll-related costs and advertising expenses as a percentage of net sales. Each of these expenses was impacted by the inclusion of World Market's financial results and our higher percentage to these categories. The inclusion of World Market and Linen Holdings increased SG&A by approximately 100 basis points. Reflecting the movement in gross profit margin and SG&A expenses, the operating profit margin for the fiscal first quarter rounded to 170 basis points lower than in the same period a year ago. Interest for the quarter includes approximately $2.2 million of World Market net interest expense, substantially resulting from the inclusion of sale leaseback obligations relating to its distribution facilities. 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 37.3% compared to approximately 33.8% for the comparable quarter last year, an increase of approximately 350 basis points. As previously said, these provisions included net tax benefit of $0.01 per diluted share this year or $2.6 million and $0.06 per diluted share last year or $14.6 million due to distinct tax events occurring during these periods. Capital expenditures for the fiscal first quarter of 2013 were approximately $65 million, principally from new stores, existing store improvements, Information Technology enhancements and other projects important to our future, including the initiatives that I previously mentioned. We remain committed to making the required investments in our company to help position us for our long-term success. Through our share repurchase program, during the first quarter, we purchased approximately 5 million shares for approximately $324 million. We are pleased that over the last 2 years, we have returned approximately 95% of our cash flows from operations to our shareholders through our share repurchase programs. While our company's Board of Directors continues to review our capital structure on an ongoing basis, our strong operations should allow us to continue to invest in our infrastructure and provide financial flexibility. As always, we want to thank our associates for their ongoing efforts which produced 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, improving 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 $0.93 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. I would like to begin by highlighting 2 items which affect the comparability of our financial statements for the remainder of fiscal 2013. First, the inclusion of World Market and Linen Holdings sales and earnings will not be comparable until after we anniversary the acquisitions during our fiscal second quarter. And second, since fiscal 2012 was a 53-week year, the net sales generated of approximately $184 million during the extra week in the fourth quarter last year and the related approximate $0.05 earnings per share will not be repeated in the fiscal fourth quarter of 2013. That said, I would like to now provide our assumptions for the remainder of fiscal 2013. One, we are modeling a 2% to 4% increase in comparable store sales for the second quarter and full fiscal year. Please note the shift in our fiscal calendar caused by the 53rd week last year and the timing of Thanksgiving relative to Christmas in 2013 will affect our reported comp store sales in the fiscal third and fourth quarters of 2013 as follows. For the third quarter, the comp store sales calendar will compare the 13 weeks ending the week of Thanksgiving in 2013 to the 13 weeks ending the first week after Thanksgiving in 2012. This will result in an unfavorable comparison in the third quarter comp store sales calculation. For the fourth quarter, our comp store sales calendar will include 24 pre-Christmas shopping days in 2013 versus 23 pre-Christmas shopping days in 2012. That, in conjunction with a compressed holiday shopping period in 2013, will result in a favorable comparison in the fourth quarter comp store sales calculation. We will provide the comp store sales ranges for the third and fourth quarters on our next call in September. Two, we are modeling consolidated net sales to increase by approximately 7% to 9% for the second quarter and approximately 5% to 7% for the full fiscal year, taking into account that fiscal 2012 was a 53-week year. Three, depreciation for fiscal 2013 is expected to be approximately $220 million. Four, assuming these sales levels and the consolidation of World Market and Linen Holdings, we are modeling operating profit margin as a percentage of net sales to deleverage for the fiscal second quarter and for the full year. Five, as we have mentioned, World Market pre-acquisition accounting policies included occupancy costs in gross profit, and these costs are now included in selling, general and administrative expenses, consistent with our standard accounting treatment. Sixth, interest for our fiscal second quarter and full fiscal year will include approximately $2.2 million and $8.7 million, respectively, in World Market net interest expense, substantially resulting from the inclusion of sale-leaseback obligations related to its distribution facilities. Seven, the second quarter tax provision is estimated to be in the 35% to 36% range, while the full year tax provision is estimated to be approximately 36.5% to 37%, with expected variability as distinct tax events occur. Eight, including the 9 stores opened so far, we now anticipate the number of store openings across all of our concepts in fiscal 2013 to be in the mid-30s. As the year progresses, the total number of stores that we will open will be updated as we gain greater visibility. Nine, we expect to continue our program of relocating, renovating and expanding a number of our stores in fiscal 2013. 10, capital expenditures for fiscal 2013 are planned to be approximately $350 million, which of course remains subject to the timing and composition of the projects. Projected capital expenditures, which include World Market and Linen Holdings for the full year, are primarily for new stores and existing store refurbishments, Information Technology enhancements, such as the relaunching of our buybuy BABY and Bed Bath & Beyond websites, upgrading our mobile sites and apps, enhancing network communications in our stores, implementing point-of-sale improvements and building, equipping and staffing our new IT Data Center to support our ongoing technology initiatives. 11, we expect to generate positive operating cash flow and continue to fund operations entirely from internally generated sources. 12, we plan to continue to repurchase shares under our current $2.5 billion repurchase program, which we anticipate completing by the end of fiscal 2015. 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 $1.11 to $1.16 for the fiscal second quarter of 2013. For all of fiscal 2013 consistent with our previous range, we are modeling net earnings per diluted share to be approximately $4.84 to $5.01. Before concluding this afternoon's call, a few additional comments relative to our recently concluded fiscal first quarter. Our balance sheet and cash flows remain strong. We ended the fiscal first quarter with cash and cash equivalents and investment securities of approximately $1 billion. This includes approximately $51 million of investments related to auction-rate securities. These securities have an estimated temporary valuation adjustment of approximately $2.4 million to reflect their current lack of liquidity. Since this valuation adjustment is deemed temporary, it did not affect the company's earnings. We will continue to monitor the market for these securities and will expense any permanent changes to the value of our remaining securities, if any, as they occur. As of June 1, 2013, retail inventories or costs, including World Market, were approximately $2.5 billion or $59.51 per square foot, a decrease of approximately 1.9% on a per-square-foot basis over the end of last year's first quarter. Retail inventories continue to be tailored by store to meet the anticipated demands of our customers and are in good condition. Consolidated shareholders' equity at June 1, 2013, was approximately $4 billion, which is net of share repurchases including the approximately $324 million representing approximately 5 million shares repurchased during the fiscal first quarter of 2013. As of June 1, 2013, the remaining balance of the share repurchase -- of the current share repurchase program authorized in December 2012 was approximately $2.1 billion. As a reminder, our next conference call to review operating results for the second quarter ending on August 31, 2013, will be on Wednesday, September 25, 2013. If you have any questions, Ken Frankel and I will be in our offices this evening, June 26, 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.