Ladies and gentlemen, thank you for standing by. Welcome to the Fourth Quarter Earnings Release Conference Call. [Operator Instructions] As a reminder, this call is being recorded. Members of the Buckle's management on the call today are Dennis Nelson, President and CEO; Karen Rhoads, Vice President of Finance and CFO; Pat Whisler, Vice President of Women's Merchandising; Bob Carlberg, Vice President of Men's Merchandising; Kyle Hanson, Corporate Secretary and General Counsel; and Bob (sic) [Tom] Heacock, Treasurer and Corporate Controller. As they review the operating results for the fourth quarter, which ended February 2, 2013, they would like to reiterate their policy of not giving future sales or earnings guidance and have the following Safe Harbor statement. Safe Harbor statement under the Private Securities Litigation Reform Act of 1995. All forward-looking statements made by the company involve material risks, uncertainties and are subject to change based on factors which may be beyond the company's control. Accordingly, the company's future performance and financial results may differ materially from those expressed or implied in such forward-looking statements. Such factors include, but are not limited to, those described in the company's filings with the Securities and Exchange Commission. The company does not undertake to publicly or -- update or revise any forward-looking statements even if experience or future changes make it clear that any projected results, expressed or implied therein, will not be realized. Additionally, the company does not authorize the reproduction or dissemination of transcripts or audio recordings of the company's quarterly conference call without its expressed written consent. Any unauthorized reproduction or recording of the call should not be relied upon as the information may be inaccurate. I would now like to turn the conference over to our host, Karen Rhoads. Please go ahead.

Thank you. Good morning, everyone, and thank you for joining our call. Our March 14, 2013, press release reported that net income for the 14-week fourth quarter ended February 2, 2013, was $61.4 million or $1.28 per share on a diluted basis. And that is up 9.4% from net income of $56.1 million or $1.18 per share on a diluted basis for the prior year 13-week fourth quarter that ended January 28, 2012. Our net income for the 53-week fiscal year that ended February 2, 2013, was $164.3 million or $3.44 per share on a diluted basis. That is up 8.5% from net income of $151.5 million or $3.20 per share on a diluted basis for the 52-week fiscal year that ended January 28, 2012. Net sales for the 14-week fourth quarter increased 7% to $360.6 million compared to net sales of $337.1 million for the prior year 13-week fourth quarter. Comparable store sales for the quarter were flat in comparison to the same 14-week period in the prior year. And our online sales, which are not included in comparable store sales, increased 5.4% to $29.1 million. Net sales for the 53-week fiscal year ended February 2, 2013, increased 5.7% to $1.124 billion compared to net sales of $1.063 billion for the prior year 52-week fiscal year that ended January 28, 2012. Comparable store sales for the year increased 2.1% compared to the same 53-week period in the prior year. And our online sales, which again are not included in comparable store sales, increased 8.4% to $84.5 million. Gross margin for the quarter was 48%, an improvement of approximately 60 basis points from 47.4% for the fourth quarter last year. This improvement was primarily driven by a 20-basis-point improvement in merchandise margins, as well as the reduction in expense related to the incentive bonus accrual. For the fiscal year, gross margin was 44.4%, an improvement of approximately 30 basis points from 44.1% in fiscal 2011. This improvement was primarily driven by a 25-basis-point improvement in merchandise margins and a reduction in expense related to the incentive bonus accrual. Selling expense for the quarter was 18.0% of net sales, which was an increase of approximately 20 basis points from the fourth quarter of fiscal 2011. Increases in expense related to the incentive bonus accrual and store payroll expense were partially offset by reductions as a percentage in net sales in bank card fees, Internet order fulfillment expense and certain other selling expenses. For the fiscal year, selling expense was 18.0% of net sales, down about 40 basis points from fiscal 2011. The decline was driven by reductions as a percentage in net sales in bank card fees, Internet order fulfillment expense and certain other selling expenses. Our general and administrative expenses for the quarter were 3.0% of net sales, down approximately 60 basis points from the fourth quarter of 2011. A reduction in expense related to the incentive bonus accrual was partially offset by an increase in equity compensation expense. For the fiscal year, general and administrative expenses were flat at 3.5% of net sales. A reduction in expense related to the incentive bonus accrual was offset by increases in equity compensation expense and expense related to the accrued vacation pay. Our operating margin for the fourth quarter was 27.0% compared to 26.0% for the fourth quarter of fiscal 2011. For the full fiscal year, our operating margin was 22.9% compared to 22.2% in fiscal 2011. Other income for the quarter was $1.2 million, which compares to $1.7 million for the fourth quarter of fiscal 2011. And other income for the full fiscal year was $3.5 million compared to $4.2 million last year. Our income tax expense as a percentage of pretax income was 37.9% for the fourth quarter of fiscal 2012 compared to 37.4% in the fourth quarter of fiscal 2011, bringing fourth quarter net income to $61.4 million for fiscal 2012 versus $56.1 million for fiscal 2011, an increase of 9.4%. For the full fiscal year, income tax expense was 32 -- excuse me, 37.2% of pretax net income in fiscal 2012 and 37.0% in fiscal 2011, bringing year-to-date net income to $164.3 million for fiscal 2012 compared to $151.5 million for fiscal 2011, an increase of 8.5%. Our press release also included a balance sheet as of February 2, 2013. This balance sheet included the following: inventory of $103.9 million, which was down slightly from inventory of $104.2 million at the end of fiscal 2011; and total cash and investments of $179.8 million, which is after payment of $254.6 million in dividends during fiscal 2012. This compares to $236.5 million of cash and investments at the end of fiscal 2011 after payment of $144.6 million in dividends during fiscal 2011. As of the end of the quarter, inventory on a comparable store basis was down approximately 1.5%, and total markdown inventory was down compared to the same time a year ago. The reduction in markdown inventory was the result of a decrease in the 20% off category. We also ended the quarter with $163.1 million in fixed assets, net of accumulated depreciation. Our capital expenditures for the quarter were $4.2 million, and depreciation expense was $9.1 million. For the full fiscal year, our capital expenditures were $30.3 million, and depreciation expense was $33.8 million. Year-to-date capital expenditure is broken down as follows: $27.8 million for new store construction, store remodels and store technology upgrades; and $2.5 million for capital spending at the corporate headquarters and distribution center. We currently expect our fiscal 2013 capital expenditures to be in the range of $34 million to $38 million. For the quarter, UPTs increased approximately 2%, the average transaction value increased approximately 4.5%, and the average unit retail increased approximately 2%. For the full fiscal year, UPTs decreased just slightly, average transaction value increased 4.5%, and the average unit retail increased approximately 5%. Additionally, during the fiscal year, our average sales per square foot increased from $462 in fiscal 2011 to $475 in fiscal 2012. Our average sales per store increased from $2.3 million in fiscal 2011 to $2.4 million in fiscal 2012. Buckle ended the year with 440 retail stores in 43 states compared to 431 stores in 43 states at the end of fiscal 2011. Additionally, our total square footage was 2.208 million square feet as of the end of the year compared to 2.156 million square feet at the end of fiscal 2011. And now at this time, I'd like to turn this call over to Tom Heacock, our Corporate Controller and Treasurer.

Good morning, and thanks for joining us. I'd like to start by highlighting the performance of our merchandise categories that led to our net sales increases of 7% for the fourth quarter and 5.7% for the full fiscal year. Men's merchandise sales for the quarter were up approximately 9.5% with strong categories including denim, knit shirts, active apparel, accessories and footwear. Average denim price points increased from $86.85 in the fourth quarter of fiscal 2011 to $87.40 in the fourth quarter of fiscal 2012. For the quarter, our men’s business was approximately 44% of net sales compared to approximately 43% last year. And the average men's price point was essentially flat at $59.90. For the full fiscal year, men's merchandise sales were up approximately 7.5%. Strong categories, again, included denim, knit shirts, active apparel, accessories and footwear. Average denim price points for the full year decreased from $88.05 in fiscal 2011 to $87.85 in fiscal 2012. For the year, our men’s business was approximately 41% of sales compared to approximately 40.5% last year. And the average men's price points increased approximately 1.5% from $54.45 to $55.25. Women's merchandise sales for the quarter were up approximately 5.5%, with strong categories including woven tops, active apparel, accessories and footwear. Average denim price points on the women's side increased from $99.85 in the fourth quarter of fiscal 2011 to $101.10 in the fourth quarter of fiscal 2012. For the quarter, our women's business was approximately 56% of sales compared to approximately 57% last year. And the average women's price points increased approximately 4% from $50.85 to $52.95. For the full fiscal year, women's merchandise sales were up approximately 4.5%. Strong categories included woven tops, active apparel, outerwear and accessories and footwear. Average denim price points increased from $96.10 in fiscal 2011 to $98.55 in fiscal 2012. For the year, our women's business was approximately 59% of net sales compared to approximately 59.5% last year. And average women's price points increased approximately 5.5% from $46.40 to $49.05. For the quarter, combined accessories sales were up approximately 10%, and combined footwear sales were up approximately 19%. These 2 categories accounted for approximately 8.5% and 4.5%, respectively, of fourth quarter net sales, which compares to approximately 8.5% and 4% for each in the fourth quarter of fiscal 2011. Average accessory price points were up approximately 7% for the quarter and average footwear price points were up approximately 17.5%. For the full fiscal year, combined accessory sales were up approximately 8.5%, and combined footwear sales were up approximately 13%. These 2 categories accounted for approximately 8.5% and 5.5%, respectively, of the full year net sales, which compares to approximately 8% and 5% for each in fiscal 2011. Average accessory price points for the year were up approximately 7.5%, and average footwear price points were up approximately 14%. For the quarter, denim accounted for approximately 50.5% of sales, and tops accounted for approximately 30%, which compares to approximately 50.5% and 31.5% for each in the fourth quarter of last year. For the full year, denim accounted for approximately 46.5% of sales, and tops accounted for approximately 31%, which compares to approximately 46.5% and 32% for each in fiscal 2011. Our private label business was up as a percent of net sales for both the fourth quarter and the year and represented approximately 1/3 of sales for the full year. During the fourth quarter, we opened 1 new store, completed 2 substantial remodels and closed 1 store post-holiday, bringing our count for the full year to 10 new stores, 21 substantial remodels and 1 closure. As of the end of the year, 325 of our 440 stores were in our newest format. Looking ahead to next year for fiscal 2013, we anticipate opening 13 new stores, including 4 for spring, 8 for back-to-school and 1 for holiday. And we also anticipate completing 7 substantial remodels during the year. By season, we anticipate one of the remodeled stores to be completed for spring, 3 for back-to-school and 3 for holiday. Planned new store openings for this spring include stores in Palmdale, California, which has already opened in February; Orlando, Florida; Fredericksburg, Virginia; and Gurnee, Illinois. And with that, we'll open it up to your questions. Operator?

[Operator Instructions] We have a question from Simeon Siegel with JPMorgan.

It's the second quarter where store sales grew faster than the online segment, which is a different trend than we're hearing from some others. Could you just remind us what your target penetration for online sales should be and your strategy around the growth of that online channel? And then maybe just taking a broader perspective for a minute, could you speak to your thoughts around your sales productivity? You've seen a very impressive lift over the past 5 years, which is particularly impressive given your exposure to the smaller, less productive markets. So can you just talk about your experience in some of the larger markets and where you see that sales-per-foot number going relative to that $475, Karen, that you just reported?

Karen, do you want to take the first part?

On the online penetration?

Yes.

We don't have -- I mean, we continue to do a lot of things on our online store to enhance the shopability for our guest. And we've just recently relaunched the mobile with enhanced features to make the mobile shopping experience better. So we do continue to invest in and look at the online shopper and plan to continue to grow that business. We don't have, I guess, a set percentage of where we think that would be. And Kyle, I don't know if you have any more that you would like to add on that part of it?

Okay. And I think on the sales productivity, it's just a complement to, one, our merchandisers on focusing on a great selection for our stores; and two, our specialty store approach of great service and creating a shopping experience that's very enjoyable, where the guests like to return several times in a month. And we continue to focus on raising the level of our store managers, definitely make a difference in our stores and their teams, and we're seeing that pay off.

All right, Dennis. And so would it be fair -- I guess, it sounds kind of similar to Karen's comment. There probably isn't a target sales per foot number, it's just kind of as the trends grow?

True. We just try to maximize them with our guest in mind of the selection that they're going to want and the variety. And naturally, we're looking to grow that number, but it's not a number we set and then try to drive it just by dollar -- just by dollars and not looking at the product.

Okay, great. And then, Karen, just quickly, can you share what the 53rd week added in sales. Sorry if I missed that.

Sure. We didn't state that exactly, but I think that 53rd week was a little over $16 million. Is that correct, Tom? It was -- that was a little bit of a softer week for the month overall.

We have a question from the line of Thomas Filandro with Susquehanna Financial Group.

So quick question. Could you guys please just kind of maybe provide some merchandise opportunities that you see entering 2013, both on the men's and the women's side of the business? And then, Karen, can you help us think about how we should view incentive comp comparisons in 2013? Because I know that impacts both gross margin and the operating expense standpoint.

Okay. Pat, do you want to start with the ladies' opportunities?

Sure. So the question was merchandise opportunities for the year 2013?

Yes.

Just briefly, we've been in the market pretty much the whole spring, and we're very pleased with the selection we're seeing and also happy with the product that we're seeing from the in-house development team. So I would say, overall, pretty optimistic.

Yes, the one thing we did last year is we added some little girls' denim, and that was successful. So we're expanding that to more stores this year. The tops part of that is very small, only limited stores. That part would not be meaningful. But the team has done a nice job with the different footwear categories, expanding on accessories and then just the variety of fabrics in the tops category and a nice selection of denim. So as Pat said, so far, we're optimistic on the product.

I may want to mention also that we did roll out our DayTrip denim last year, in 2012, which had a nice guest response. And we'll continue to build on that for this coming year.

What's the price points in that denim, Pat?

It's an opening price point initiative for us, and the first price points are $49.50.

Yes. And they could go as high as $59.

Right.

Bob, do you want to take the men's?

Yes. There's probably still opportunity in denim. The private brands, as Tom mentioned, are growing. And then denim, woven and knits are probably the best opportunity on the men's side. And then knits, in general, there's a lot of new colors and fabrics. And kind of as Pat mentioned, the selection, it seems like it is very good from both the brands and what we're developing and making newness out there. So I think, cautiously optimistic for the men's side, too.

And Tom, as one more thing is like on the men's, they're not adding the boys' sizes necessarily for the most part, but they are expanding sizes now in the smaller end but -- and some of the XXL and depending on the products, some larger sizes to take advantage of that guest as well.

On denim, we'll be running from size 24 waist all the way to a 46 and extra small to XXX on the tops.

Karen?

And Tom, on the incentive comp, really, there are 2 components to that. The executive compensation and the bonus pool for the other corporate management people are all driven on growth in 3 different categories. And so it's not on dollar one of profit. It's really geared towards growth in comparable store sales, gross margin and pre-bonus, pretax net income. The other big component of incentive comp is our store managers' bonuses. And that's why you probably noticed in the narrative that in selling expense, we did have an increase in the bonus accrual. And the store managers are set up to receive a percentage of the net profit of their stores. So theirs is not set up on growth in those 3 categories but the net profit of their store set up and depending upon the specific situation. A variety of percentages or structures there. But so with the net profit growth, that pool of bonuses did grow for fiscal 2012, whereas the executive and the corporate management pools that are -- where a lot of that is in the cost of goods sold and in the G&A, those pools were down for the year because we did not have as many dollars of growth in those 3 categories compared to a year ago. Does that help?

Yes. But is there any spike or -- from a comparison standpoint quarterly? Is there any big variances that we should think about comparing against this year?

I mean, no, I will -- what we do at the end of every quarter, we take a look at where we are at that point in time year-to-date, make projections as far as where we anticipate being for the fiscal year. So fourth quarter always has a little bit of a true-up, up or down, depending upon how the year actually ends because the first 3 quarters, there is definitely an estimation component to it.

Got it. Can I ask one final question and let someone else chime in? Could -- I think Tom mentioned that the private label performance was strong, and it was up as a percentage of the business year-over-year. I don't know if you gave a specific percentage, Tom. If you could, that would be great. And obviously, I think you guys are telling us DayTrip and ReClaim -- if you could just give us a broader sense of what else is working in private label, that would be helpful.

On the men's side, the BKE denim brand has continued to grow very nicely. On the ladies' side, the BKE is still very, very good, although we changed some vendors on that. So we had a little hiccup on delivery there, but we're still proud of that. And then we have a lot of different labels, the BKE and the gals' tops from BKE, RED, BKE Sport and variety. And then on the men's, Bob, do you want to add to the comments?

Yes, we kind of have a good, better, best deal, where ReClaim is kind of our jump into the Buckle-type price point. And then BKE is far and away the biggest end from value, and then Buckle Black is these all premium fabrics and runs more in that $89 to $108. And then we did add BKE Vintage to both denim and tops to try to take a little bit of a shot at a little bit cleaner look.

Sometimes, Tom, those evolve, depending if we find a new category that maybe doesn't fit the labels that we're using now, that we would maybe come up with a new label that is appropriate for the product.

Got it. And the overall percentage of private label?

For the year, it was right about 1/3.

1/3, and that was up, you said, Tom?

Yes, I think it was close to 32% last year, so up a little bit, and it's a higher percentage in the fourth quarter.

We have a question from the line of Paul Alexander, Bank of America Merrill Lynch.

Wrapping up the year here, maybe it's a good time to revisit your long-term view of margin potential. I think last year, at some point, you said you didn't see much upside for further merchandise margin improvement. Do you still feel that way? And where do you think further operating margin expansion could come from, especially as the business is seeming to settle into a kind of a stable comp trend here, maybe flattish, slightly positive to slightly negative? And then related to this question, could you talk about what you're seeing on the product cost inflation front for 2013?

Yes, on the margin, I don't think we said we couldn't do it. I think we said the margins have been so high that we weren't promising continued growth on that. Our teams continue to excel and build talent around them. So we've been very proud of what they've accomplished and feel they will most likely do a very good job. Whether we can grow that margin, that will just be yet to be seen. We're not going to forecast on that. Let's see. On the product cost, we're not really seeing any pressure on our cost of our product right now. I'd say it's pretty consistent with last year. Some opportunities possibly here and there, different categories, but it's -- I mean, we're buying constantly, and everything is evolving and changing. And our product is always developing to be new and fresh. And so we're not always pricing the same or similar product as the year before. But on product that is, I would say there is -- hasn't been any real change at this point.

And related to this question, there was 20-basis point improvement in merchandise margin in the fourth quarter. How much of that was related to lower product costs? And if so, is there any carryover of that trend into first quarter?

I don't know if I've studied that well enough to say, Paul. I think...

We have a question from the line of Edward Yruma with KeyBanc.

This is Luke in for Ed. Wanted to follow up on kind of what you're seeing with comps going into the rest of the quarter. I know you've put out February. And should we expect to see -- how do we think about promotions going into the rest of the year? Will there be any kind of increase in promotions, in thinking about driving comps, and also with online growth?

Well, we're not forecasting sales. Promotions, we're doing -- I assume you mean like we're doing our spring bag promotion with our vendors, that gift with purchase that we have going on and is something we've done for several years now. And then we don't have any other promotions during the first 6 months that we are anniversary-ing, so I really don't have anything to add on that part of the comment.

Okay. So nothing particularly -- nothing incremental to the promotions you had in previous year?

Correct.

Great. And then with the new stores that you're adding, I know you've mentioned in the past that you've -- with -- even with remodels, first, that you can see possibly some single-digit, double-digit type of gains, depending on how much the space you might add on or take on. So with remodels and also the new stores, kind of what's the expectation for productivity for those new stores coming online? Is it consistent with the prior year or any kind of expectations for increases?

I think our expectations would be similar to the past year. As you know, we just go into the markets. If we're pretty well known in those markets, they might start faster than if it's a market that we're not as well known, but no real change from the past experience.

[Operator Instructions] We have a question from the line of Janine Stichter with Telsey Advisory.

I was just wondering if you could talk a bit about your comp trends, what you've been seeing in some of your newer markets versus some of the markets where you're more mature, and if you feel that the brand awareness is building, particularly on the East Coast.

Yes, I think we're seeing some steady progress there and pleased, overall, with our stores. As I mentioned earlier, our store manager makes a big difference in our stores and the selection there. So we're not seeing any geographic area that is not working or working necessarily better. Naturally, where we have the longest history, that is where our strength is. But we feel good about our store selection out there.

We have a question from the line of John Kernan with Cowen and Company.

This is Jerry on for John. I was just -- your AUR has been up pretty steadily the past couple years. I was wondering if you could give us some color on how we should think of that heading into the first quarter, and just what assumptions are embedded in your AUR outlook.

I apologize, with the AUR, what -- can you break that down, average what?

Average unit retail.

Average unit retail. Okay. We would see, pretty similar to the past, like in the ladies' denim, would be similar to -- probably the retail would be similar to the first quarter last year, because you have the denim crops styles in with the full-length denim. So I think it was around $96 last year. We would think it would be in that area. And I think, Bob, as we discussed, we were thinking the men's denim would be similar to the holiday price points. Is that correct?

Yes, I think so.

Okay. And in the other categories, I would say, for the most part, they would be very similar pricing. I don't see any major changes there. In the ladies' boots last year, where we had a nice inventory there and a nice response, that raised our footwear average sales up. And so for the first half of the year, even though we have some shorter boots and some styles there -- well, actually, we didn't have much a year ago, so the first half comparison will probably still be up some.

And just to add to that, on the accessories that Tom mentioned, we're up 7%. Most of that is probably due to us adding that brand like Oakley sunglasses and the amount of Nixon and Diesel watches, which are quite a bit higher retail than where we had been before.

[Operator Instructions] We have no one queued up right at this time.

Okay. Thank you very much.

All right. Linda, we'll conclude the call then, and we want to thank everyone for joining us.

Thank you. Ladies and gentlemen, this conference will be available for replay after 10:30 a.m. Central Time today until March 28 at midnight. You may access the AT&T Executive playback service at anytime by dialing 1 (800) 475-6701 and entering the access code 284873. International participants may dial 1 (320) 365-3844. That does conclude our conference for today. Thank you for your participation and using AT&T Executive TeleConference Service. You may now disconnect.