Bob LaPenta - Treasurer Tom Kingsbury - President and CEO Todd Weyhrich - Chief Financial Officer

Lorraine Hutchinson - Bank of America Merrill Lynch Paul Lejuez - Wells Fargo Kimberly Greenberger - Morgan Stanley Stephen Grambling - Goldman Sachs John Morris - BMO Capital Markets John Kernan - Cowen and Company Dana Telsey - Telsey Advisory Group Karru Martinson - Deutsche Bank Carla Casella - JP Morgan

Good morning and welcome to Burlington Stores’ Third Quarter Fiscal 2013 Earnings Conference Call. The call will begin with prepared comments by management followed by a question-and-answer session. (Operator Instructions). During today’s Q&A session, we would ask that you limit yourself to one question and one follow-up question before returning to the queue. Please note today’s call is being recorded. I would now like to turn the call over to Bob LaPenta, Burlington’s Treasurer. Please go ahead sir.

Thank you, operator and good morning everyone. We appreciate everyone’s participation in today’s conference call to discuss Burlington’s third quarter fiscal 2013 operating results. Our presenters today are Tom Kingsbury, our President and Chief Executive Officer and Todd Weyhrich, our Chief Financial Officer. Tom will begin with a brief overview of the third quarter financial results and discuss some recent developments while providing a discussion of our ongoing transformation. Todd will then review our financial results and future outlook in more detail before we open the call for your questions. This call may not be transcribed, recorded, or broadcast with our expressed permission. A replay of the call will be available for seven days. In addition, I need to remind everyone that information on today’s call is primarily related to the company’s results of operations for the third quarter ended November 2, 2013. As a reminder, as a result of the 53rd week in fiscal 2012 our comp store sales have been calculated on a shifted basis by comparing comp store sales for the 13 weeks ended November 2, 2013 the comp store sales for the 13 weeks ended November 3rd 2012. Remarks made on this call concerning future expectations, events, strategies, objectives, trends or projected financial results are forward-looking statements and are subject to certain risks and uncertainties. Actual results or events may differ materially from those that are projected in such forward-looking statements, such risks and uncertainties include those that are described in the company’s S1 and in our other filings with the SEC all of which are expressly incorporated herein by reference. Now I'll turn the call over to Tom.

Thank you Bob and good morning everyone. Thank you for joining us today. Before I get started I’d like to take a moment to thank everyone who helped us through the recent IPO process. Our employees, customers and advisers were all essential to this effort. In addition I want to thank the new investors who spend time to learn our story and who see the tremendous opportunity in Burlington as we execute towards our goal of being a world-class off-price retailer creating long-term shareholder value. This has been a transformative journey for the entire team at Burlington. We're continuing to focus on the ongoing transformation to deliver value to our customers and our stakeholders. For our customers we're focused on driving execution improvements to make Burlington a more effective customer-centric company, to become the leading destination for on trend brand and merchandise at a great value. And for our investors we're focused on delivering on the long-term targets we communicated through the IPO process including 6% to 6.5% annual net sales growth, 2% to 3% annual comp store sales growth, annual adjusted EBITDA margin expansion of 10 to 20 basis points, annual adjusted net income growth of plus 20% and expanding our store footprint by opening approximately 25 new stores a year. Q3 2013 was a solid quarter for the company as we delivered at or above many of these targets and we remain focused on delivering on this performance in the future. In the third quarter net sales increased by 10%, comp store sales increased by 3.9%, adjusted EBITDA increased 28.3% to $62 million. We open 19 new stores and closed one existing stores, bringing our total store count to 521, which is inline with the guidance we provided in the road show. Todd will provide additional detail on the financials later in the call. But overall we are happy with our performance and are continuing to move in the right direction. While many of you on today’s call may have followed Burlington in the past, we wanted to take this opportunity to reintroduce the company to the market, for the benefit of our new equity investors and for others who may have missed us on the Road Show. Burlington has a storage history and 2012 was a milestone year for us as we celebrated our 40th anniversary, crossed $4 billion in sales, and opened our 500th store. We are a national retailer continuing to build on our momentum, at the end of the third quarter we have 521 stores operate in 44 states and Puerto Rico. We offer our customers an extensive selection of quality and nationally recognized brands from our 3,500 manufacturers that are on trend and a great value. We are in Everyday low price retailer delivering strong value to our customers on a daily basis. Our prices are 60% to 70% off the prices in traditional department stores. We offer value without the [limits]. Our core customer is a female shopper shopping for family and their self and we offer a compelling mix of businesses on our stores to address our customer need including women's ready-to-wear, menswear, accessories and footwear, youth apparel baby depot, coats and home. We operate flexible stores that are largest than many of our competitors which provides us with the ability to carry more categories like baby depot and men’s tailored clothing and more depth in each category. We offer great breadth of styles and vendors to create a positive treasure of fun shopping experience for our customers. We ensure ample open to buy liquidity. So we can products continually throughout the year taking advantage of the great end season deals that come to us daily. We have been focused on driving significant improvements throughout the organization. We have assembled a talented, experienced management and merchandising team and refined our off price model through improved buying in inventory management. We have invested in technology and systems to drive growth and improved efficiency and built a data driven testing culture to ensure successful roll out of new initiatives. We have also transformed the marketing model and sharpen the focus on our core female customer. We introduced a program to improve customer experience in store operations, refreshed existing stores and expanded our new store base. And finally we've enhanced our real estate our real estate underwriting in new store selection process. All these improvements together have transformed Burlington into a more customer centric company and we believe are driving our strong comp performance. We believe, we are in the early innings of harvesting the benefits from our initiatives and that we will continue to drive growth going forward. On the road show, we discussed our growth strategies that will drive our growth across the short, medium and long term including driving comparable store sales growth. Expanding our retail store base and enhancing our operating margins. I would like to provide an update and how we are performing against these strategies through the third quarter. Our first and most important growth strategy is to drive comparable store sales growth. We are executing on a number of initiatives on this font including enhancing the execution of the off-price model by being liquid to take advantage of market opportunities, working with numerous vendors providing customers with fresh styles and brand and improving our merchandized localization by getting the right products to the right stores at the right time. In addition, we are focused on increasing sales on women’s apparel, shoes and accessories, growing our home business and introducing a new marketing campaign this fall season. For this quarter, we delivered a 3.9% comp driven by strong performances in key businesses like tethered to our core female customers, such as Missy Sportswear, Intimate Apparel, dresses and suits and shoes. In addition, our home business outperformed our company average during the quarter. We are able to achieve this results by continuing to improve the balance of upfront versus in-season purchasing, maintaining liquidity, expanding our vendor base, testing their react into new trends, delivering exceptional value and flowing goods weekly to ensure freshness on the selling floor. By geographic region, the west and the northeast outperformed, while the mid-west and the southeast trailed the company average. Inventory management continues to be an important initiative for us. Overall, we were pleased with the level and currency of our inventories at the end of the third quarter. Our comparative store inventory level was down 5.6% versus last year, which contributed to a 10% faster turnover. In addition, the level of inventory age 91 days and older continued to decrease versus last year. At the end of the quarter, pack and hold inventory represented approximately 12% of our total inventory. As we've stated before, we do not set target for pack and hold product. The amount is completely dependent on the availability of highly desirable branded product or key seasonal merchandise at strong values. We are excited about the brands and valued that we've been able to secure through our pack and hold program. We’re seeing great buying opportunities in the marketplace and believe that current environment is on target with our expectations. Overall, we are seeing inventory from more vendors and finding more opportunities for branded fashion at significant values. The second leg of our growth strategy is expanding our retail store base. We have confidence in our underwriting of new stores and currently face no meaningful barriers to prevent us from expanding our store base. We believe our current store footprint of 521 stores provides significant wide space opportunities for growth, both in our existing and in new markets. We believe based on internal projections, combined with our ability to operate in different size boxes that a 1,000 stores is a realistic long term goal. As such we plan on opening approximately 25 new stores per year in the future. And as we discussed on the road show, we've opened 23 net new stores -- 23 new stores and closed two stores in 2013. Specifically in the third quarter, we opened stores across the country from East Harlem, New York to Cincinnati, Ohio and Scottsdale, Arizona which include both new and existing markets for the company. Our third growth strategy is focus on enhancing our operating margins. Over the quarter, we delivered adjusted EBITDA margin expansion of 80 basis points versus the prior year. This improvement was driven by improved merchandise margin and expense leveraging. I would now like to turn the call over to Todd to provide additional detail on our financials. Todd?

Thank you, Tom and good morning everyone. Thank you for joining us today. We're pleased with our performance for the quarter, which included a net sales increase of 10% and a comp store sales increase of 3.9%. On a year-to-date basis, net sales have increased by 9.9% and comp store sales have grown by 5%. Gross margin rate for the quarter improved 40 basis points from 38.6% last year to 39% this year. Year-to-date, margin rate has improved by 50 bps to 38%. As a percentage of sales, selling and administrative expenses decreased to 34.1% during the quarter compared with 34.6% in the prior year. Year-to-date, this metric is 32.9%, 70 basis points better than last year’s year-to-date result. These improvements are primarily driven by leverage on store payroll, advertising and occupancy costs, partially offset by increased incentive compensation. Adjusted EBITDA increased by 28.3% or $14 million to $62 million during the quarter, representing an 80 basis point improvement in adjusted EBITDA margin rate for the quarter. Year-to-date, adjusted EBITDA increased by 33.6% or $48 million to $189 million compared to last year, representing a 110 basis point improvement in adjusted EBITDA margin rate for the year-to-date period. Adjusted EBITDA starts with net loss and adds back net interest expense, loss on extinguishment of debt, tax benefits, depreciation and amortization, impairment charges, advisory fees, cost related to debt amendments of the IPO and stock option modification expense. Interest expense increased by $5 million for the quarter to $33 million and [$60 million] year-to-date to $100 million due to interest associated with our $350 million hold co-notes issued on February 14, 2013, partially offset by a decrease in interest expense associated with our term loan re-pricing which was completed in May of this year. Adjusted net loss increased by $2 million to $3 million during the quarter and improved by $12 million year-to-date to $11 million compared with the prior year’s period. This was primarily driven by the operating results mentioned above, partially offset by increased interest expense. Adjusted net loss starts with net loss and adds back loss on extinguishment of debt, net favorable lease amortization, impairment charges, advisory fees, costs related to debt amendment and the IPO, and stock option modification expense. All of these adjustments are tax effective by the tax rate in effect for the period before discrete items. For a reconciliation of our reported net loss to adjusted net loss and adjusted EBITDA, please refer to the reconciliation table included in our third quarter earnings release. Pro forma basic and diluted adjusted net loss per share increased to $0.05 compared with $0.02 from the prior year's third quarter. For year-to-date period, pro forma basic and diluted adjusted net loss per share was $0.15 compared with $0.32 per share last year. For the quarter, our pro forma weighted average shares outstanding for both basic and diluted purposes was 73.6 million shares. As noted in this morning's press release, pro forma weighted average shares outstanding represents the weighted average common shares outstanding during the period giving effect to the conversion, stock split and issuance of 15.3 million of shares of stock offered by the company as if the offering occurred at the beginning of our 2012 fiscal year. At the end of the quarter, we had $31.6 million in cash, $38 million in borrowings on our ABL and $521 million in unused credit availability. Today, we have no borrowings on the ABL and have availability in excess of $500 million. At the end of the quarter, we had $1,716 million in debt of which $231 million was classified as current. $222 million of the current maturities were related to our $350 million Holdco notes which were redeemed in November using proceeds from our initial public offering. Merchandise inventory at the end of the quarter was $902 million compared with $845 million last year. The increase primarily reflects the increases in pack and hold inventory and the results of opening 23 net new stores since October 27th last year. These increases were partially offset by a comparative store inventory decrease of 5.6% from the third quarter last year, driven by our merchandising initiatives. Accounts payable increased $30 million to $708 million at the end of the quarter, representing 76 days of accounts payable outstanding, reflective of our normal payment terms for inventory at quarter end. For the year-to-date period, we had a net use of cash of $12 million. Cash flow from operations was $83 million and cash flow from financing activities was $258 million. These inflows of cash were offset by $353 million in cash used in investing activities including the $122 million gross spend in capital expenditures. Included in our cash flow from operations were $19 million of landlord allowance payment, which reduced our year-to-date capital expenditures to $103 million on a net basis. Our expectation for full year capital expenditures is $140 to $150 million net of landlord allowances of $34 million. In terms of our capital allocation strategy, our expectation is to utilize free cash flow to pay down debt. And we will be opportunistic with our capital structure as we look out into 2014 and beyond. During the quarter, we opened 18 new stores, brining our total store count to 521, as we discussed on the road show. The new stores continue to perform well and incremental new stores are expected to average between $7 and $8 million of annual revenue and have four wall EBITDA of approximately $1 million. Importantly, we received significant landlord support on many of our stores; and we expect that our total investment in new stores will average about $1.6 million and that our payback periods will average less than three years. And other very important point is to note that our stores almost always contribute positively within a four wall basis within the first year and half of operations due to short store maturity curve. Turning to our outlook, we expect comp store sales to be between 2% and 3% in the fourth quarter. For the full year, we expect adjusted EBITDA margin improvement of 30 to 40 basis points compared to last year. Net interest expense is expected to be approximately $128 million, our effective tax rate for adjusted net income to be 41% and pro forma fully diluted shares for fiscal 2013 to be $74.8 million. And with that I will now turn the call back over to Tom.

Thanks Todd. We are very pleased with our performance in the third quarter and our first quarter post IPO. We believe that we are executing the off-price model very well right now and our comp sales performance is a result of that. We continue to be very excited about the remainder of 2013. We believe that the level and currency of our inventories, the maturity of our buying organization, the implementation of our markdown and allocation optimization systems, as well as the outstanding support we are receiving from the vendor community heads us well positioned for the fourth quarter and beyond. From new store point of view, similar to our recent pace, we've opened 21 net new stores this year. We are excited about the opening of our West Coast buying office, which has already increased our access to brands and vendors. In closing I’d like to thank our store and corporate team for their hard work, contributing to a strong 3.9% competitive store sales increase in our significant growth and adjusted EBITDA and thank investors for taking their time to learn more about our story. This concludes our prepared remarks. So let me turn it back over to the operator to start the Q&A session.

Thank you. (Operator Instructions) Thank you. Our first question comes from the line Lorraine Hutchinson with Bank of America Merrill Lynch. Please proceed with your question. Ms. Hutchinson, your line is live perhaps you have yourself on mute. Ms. Hutchinson your line is live. Lorraine Hutchinson - Bank of America Merrill Lynch: Hi sorry. Good morning. Thanks.

Hi Lorraine. Lorraine Hutchinson - Bank of America Merrill Lynch: Hi. Good morning. Just wanted to follow-up on the gross margin; can you talk about the drivers of the 40 basis points of gross margin upside this quarter? And then is there any gross margin expansion contemplated in your fourth quarter guidance?

This is Todd. I'll go ahead and take that one. As we've talked on the last few calls and during the road show, the initiatives that we have in place in merchandising, the key thing we have to have out-of-the-gate is to make sure that we're priced correctly. And we've done a lot of work over the last year to make sure that we are competitive on our price as we clearly don’t want to be beat on those. Our markdown optimization tool continues to evolve as we go through this year. And so as we look at the drivers of margin improvement, we do have a slightly lower shrink accrual rate, that’s a piece of it, but we also are generating net margins better than we did last year and that’s really driven by being price sharp or out-of-the-gate, taking our markdowns more opportunistically to make sure that we're driving maximum sales and margin rate. But in the end it’s basically all the initiatives that we have in place. We look for the full year. We basically in our guidance are indicating flow-through to the EBITDA margin. We expect that to be 30 to 40 basis points better. We do expect some of that to come out of reported margin. And we do expect some expense leveraging. As we work our way through the quarter, we’ll continue to do what we think is right to drive top-line growth and to drive appropriate value for our customers. But the details within gross margin beyond that I don’t think is appropriate to get into, because in the end we are managing for the full company result for the year. Lorraine Hutchinson - Bank of America Merrill Lynch: Great. And then could you talk a little bit about comp drivers for the quarter, traffic ticket conversions?

This is Tom. I’ll take that one. So when you look at it and when you break it down, really a lot of things that drove our comps was, as I mentioned in prepared remarks and then I’ll get into traffic and all the other stuff. It was really the fact that we’ve been able to really build our business in that core female category. We really feel we made significant progress in our (inaudible) sportswear business. We’ve had a great performance in Intimate Apparel, our dress and suit business overall, had nice growth in our shoe business and we’re realizing the opportunity that exist in the home, which we know is a big opportunity for us. So as it relates now to really traffic is slightly up, our AUR is slightly down based on what Todd had indicated the fact that we’re making sure that we’re as competitively priced as possible, getting better deals in the marketplace. Our conversion is up more than our traffic. And our average basket is up comparable to the increase in the conversion rate. So that’s what’s really been driving it. So the big strong performance in a lot of these strong categories of business and then obviously conversion rate I mean that helps us a lot. People are coming into our stores, they notice how many more brands we are carrying, the values we have and they are converting better. Lorraine Hutchinson - Bank of America Merrill Lynch: Thank you.

Our next question comes from the line of Brian Tunick with JP Morgan. Please proceed with your question.

Hi, thanks for taking my question. This is (inaudible) dialing in for Brian. My first question is on margins. You got nice leverage this quarter better than the expected especially given that we thought there were some timing shift of expenses out of the first half into the second. So I was wondering if there were any expenses that are shifted out of 3Q into 4Q and how we should think about expense leverage into fourth quarter assuming that you will get from onto the three comp guidance? And then I know you have been reducing your Alliance [Own] Coats and shrink that as a percent of sales. So can you remind us what percent of sales do coats are counsel into the fourth quarter specifically and how that may compare to maybe prior years? Thanks.

Do you want to take that?

Sure. Hey this is Todd. I'll the take the first one on expenses. During the quarter, we did get good leverage on store payroll and in advertising. The only thing that I would say is a little bit of shift of expenses versus maybe timing last year is in advertising and marketing spend. We’re a little bit higher than in the third quarter here. As it relates to the full year leverage, I think the guidance that we gave before that we expect our adjusted EBITDA margin rate to be 30 to 40 basis points better than last year for the full year is probably the right level of discussion to have here. We do expect there to be leverage on expenses, we do expect there to be some level of margin expansion. But again as we work our way through the quarter, the weight between those two will move around so that we best drive sales for the company. Tom do you want to talk about...

Yeah. I'll talk about coats. On an annual basis, coats as a percentage of total is high single-digits. Obviously as we get into the colder months, the penetration grows. But I think we've done a very good job as we built the other categories to be less driven based on the weather. One of the businesses as we grow home, we really feel that will help us de-weather our business overall. But coats is a very good business for us, obviously represented 100% of our business when they started out and overtime it’s been going down. But we really feel that it’s a business that has been the very important part of Burlington overtime. But we’re working very diligently on building other categories so we de-weather our business.

Thank you, best of luck.

Thank you.

Our next question comes from the line of Paul Lejuez with Wells Fargo. Please proceed with your question. Paul Lejuez - Wells Fargo: Hey, thanks guys. Just one important clarification, I think -- in response to a couple of questions you keep talking about the full year adjusted EBITDA guidance being up 30 to 40 basis points and press release says fourth quarter that that is the expectation as well. I just want to clarify that that was the case? And then second, can you just maybe talk about the number of vendors that you are currently working with. What is the count at where were you last year and how do you expect that to change over the next several years? Thanks.

Yeah. This is Todd. I’ll take the first one. The increase in adjusted EBITDA, the 30 to 40 basis points is for the full year contrary to what is says in the release. So thanks for asking that question so we can make sure it’s clear here. But it is -- we are looking for 30 to 40 basis points at the adjusted EBITDA line for the full year. And with that I will turn it back over to Tom.

One of the areas where we have a big opportunity is to add more brands to ourselves and overall. Our competitors they have more brands than we do. One of them says they have 8,000 and another one says they have 16,000. At the end of last year, we operated with about 3,500 active brands and we had added 2,000 new brands, when we got rid of 1,500 brands, we felt were not as relevant. Right now we've added about 1,100 new brands to this year, I think when its nets up we’ll probably be about 4,000, so we’ll be about 4,000 versus 3,000 last year to give you color on that. But we really feel that's a big opportunity. That’s one reason, why we’re really excited about our West Coast office, we really feel that that's going to give us the ability to bring-in even more brands. Paul Lejuez - Wells Fargo: Can you add 1,000 a year?

Well I think the opportunity exists to do that. I think now that we've got rid of a lot other brands, we don’t think are as important we’re going to have more growth, because we've added out a bunch of brands that we felt were not as relevant to say sort of -- So maybe next year we could add a 1,000 brands. Paul Lejuez - Wells Fargo: Okay. Thanks guys, good luck.

Thank you, Paul.

Thank you, Paul.

Our next question comes from the line of Kimberly Greenberger with Morgan Stanley. Please proceed with your question. Kimberly Greenberger - Morgan Stanley: Great thank you, good morning.

Good morning. Kimberly Greenberger - Morgan Stanley: I just wanted to follow-up on Paul’s question regarding EBITDA margin, with the full year expected to be up 30 to 40 basis points year-to-date, obviously here you guys have had about 110 basis points improvement. Does that still suggest that that EBITDA margin will in fact be higher in Q4? And I think earlier in the question-and-answer session, you suggested that that implied fourth quarter guidance would include some slight level of gross margin expansion and some leverage on SG&A, I just wanted to make sure, I understood all that correctly.

Okay. This is Todd I’ll take that one. So for the fourth quarter, what we didn’t want to get into is too much detail beyond where we're guiding in terms of sales and the flow-through to the bottom-line. The fourth quarter by itself because of the timing of investment in payroll and investment in marketing doesn’t have the same level of improvement as the full year. So we really want everyone to focusing on the full year adjusted EBITDA margin. The key there would be how we price goods, how we take markdowns, how we spend especially in store payroll and advertising, are very much to deliver the best result that we can for the year. So we do have some shifts and timing of when some of those expenses occur but we do expect there to be some gross margin expansion and full EBITDA expansion for the full year. Kimberly Greenberger - Morgan Stanley: Todd, my follow-up question is just on the third quarter sales trend. I am wondering if you saw this same kind of cadence in the third quarter that the rest of the retail industry saw was a strong August and the strong October offset by a slightly slower September. And then just any commentary around some of the cold weather categories, whether you saw any benefit in October or November from the cold [snap] that we've been seeing across the Northern tier of the country? Thanks so much.

I'll take that one. Yeah, we have the pretty much our business in the third quarter really reflected what happened in the rest of retail in terms of good August, not as great September, a good October so pretty much followed whatever everyone else experienced what there seems to be. Yes, I think its colder, we sell more cold weather product. So in the month of October, I can’t comment on November but on the month of October in the cold weather categories we had a nice lift. Obviously there is a direct correlation between cold weather and the cold weather businesses and it reflected that in October. Kimberly Greenberger - Morgan Stanley: Thanks so much.

Thank you.

Our next question comes from the line of Stephen Grambling with Goldman Sachs. Please proceed with your question. Stephen Grambling - Goldman Sachs: Good morning and thanks for taking the questions. As a quick follow to Kim’s question can you maybe talk about how you maybe have to react to the environment that’s out there right now and seems like just a little more promotional across the mid tier? Do you feel like there is any need to tweak the promotional cadence?

This is Tom. I will take that one. We’re an everyday low price retailer, we work really, really hard every single day to deliver the best value as we possibly can. We don’t have POS sales like some of our competitors the mid tier department stores do. So it’s always promotional and this fourth quarter is going to be no different than any other fourth quarter, maybe a little bit more promotional as we experience as we looked at Black Friday across the country, but our goal is to make sure our customers get the best values every single day and as far as tweaking what we are currently doing as an everyday low price retailer we are just delivering the great values that we possibly can. Stephen Grambling - Goldman Sachs: Thank you. And maybe just changing gears a little bit, you think about the home efforts, where you think you are in that process, what needs to happen to kind of continue to drive the momentum there?

Well I think we had a good quarter in the third quarter so we feel very good about the progress we have made so far year-to-date. We need to just continue to build two categories of businesses; one of which is our housewares business which historically actually two years ago we weren’t even in the housewares business. But we're very deficient there, which we're building, we're doing a very nice job of building that business overall. And also our home décor business, we've always been in the home décor business, but really not with the level of inventory and the type of product and the value that we think we need to have to grow that business. But I think we made a lot of good progress so far this year in terms of building our home business. And we are going to continue to focus on those two categories I just mentioned to fully realize the total growth that we have in this category. Stephen Grambling - Goldman Sachs: Great. Thanks. Good luck for rest of holiday.

Thank you.

Thank you.

Our next question comes from the line of John Morris with BMO Capital Markets. Please proceed with your question. John Morris - BMO Capital Markets: Thanks. Good morning everybody. Congratulations on a great start here out of the gate. Two questions, one would be, tell us a little bit about the new marketing campaign and the results that you’ve seen from it so far. What kind of metrics are you using to track its performance, and can you share with us the kind of how that's doing in terms of the returns for the return on the investment regarding the marketing campaign, the commercials and whatnot? And what you have planned for that as you go into Q4 or as you are in Q4? And then secondly, the smaller boxes, the smaller store sizes, what kind of performance have you seen on those as of late through the most recent period? Thanks.

So, to talk about the new marketing campaign, we've gotten a lot of positive responses from our customers in terms of the customer chats that we do. They really like it, they resonate with them. We've done some tweaking over time to make them even better. Obviously when you start out with a new agency, there is things that you have to do along the way in order to get the commercials exactly the way you want. We will measure and we are currently measuring the type of lists in the campaign. But to be honest with you, most of that analysis will be done after we complete the fall season. So, we will be able to share that information with you in March when we go to our fourth quarter earnings call. But we’ve gotten some good responses from the customer. Obviously we had a 3.9% comp in the third quarter; I’m sure some of that was based on how the customers reacted to the commercials overall. As far as smaller boxes go, we really feel that we can operate in the smaller box. We were opening at one point in time 80,000 square foot boxes. In 2013, the average size of boxes slight over 60,000 square feet and all the stores that are the stores that we think so far for ‘14 a little over 60,000 square feet. So we really think the sweet spot for our store going forward is 50,000 to 60,000 square feet because we know, we feel very confident we can operate in a 50,000 square foot box also. But we look at each individual site, and how much business we are going to determine what size box we want to have overall. But we really feel confident that the size of our boxes will go down in the future. And the productivity, there is a direct correlation between dollar per square foot and the size of the box from the productivity. We really feel that based on the fact that we’ve reduced the inventory significantly in store, and we can operate in smaller box, we really feel that it helps the navigation for our customers, when we have a smaller box. So, there is really a lot of benefits for the smaller box. And we are basically headed in that direction. But when you break it down though, I mean we talk about this all the time in terms of what size box should we have. And if you do the math, I mean with the 60,000 square foot box, let’s just take that for now, we need about 8,000 to 10,000 square feet per coats because obviously that's a big dominant business for us, we need about 8,000 to 10,000 square feet for our baby depot business which is a differentiator for us, and we need about 8,000 to 10,000 square feet for our tailor clothing business and our strong dress categories. So if you take that out like-to-like space, we’re fairly comparable to our competition. So that's how we’re basically -- we’re looking at it. John Morris - BMO Capital Markets: Great, thanks.

Thank you.

Our next question comes from the line of John Kernan with Cowen and Company. Please proceed with your question. John Kernan - Cowen and Company: Hey good morning guys, thanks for taking my question.

Good morning. John Kernan - Cowen and Company: Can you just give us an update on some of the merchandising initiatives, the planning allocation, improvements that you’ve talked about kind of coming out of the IPO, where are we there? And seems like you are starting to continuing to flow inventory a little bit faster and better. And then secondly, can you talk about -- it sounds like you’ve done some work on pricing, have you seen any change in that pricing umbrella between yourselves and off-price retailer as far as some of the mid-tier to (inaudible) store channel? Thanks.

Okay. As far as planning allocation, as you know, we spent; we spent a lot of money on systems over the last five years to really help the buyers buy the right product. We have a much more robust merchandise planning system in general. We have -- we've initiate a markdown optimization, which we really feel is a huge win for us overall. We've added a new markdown, or excuse me, allocation, optimization system, which obviously one of the key things that we’re working hard on because is to get the right goods in right store at the right time. And lastly, we work really hard on business intelligence tools to help the merchants see what they’re buying to make sure that we're buying all the right products. So, this has been rolled out over time, we spent the money over time. That investment is behind us which is really the good news. But we really feel there is a lot of benefit in the future because you can roll out the systems, you can get the systems in place but then it takes time to teach, train people the most -- to use those tools the most efficient way. So, we're working on all that. Markdown optimization is really good example where we really completed the roll out to all categories in the company as of August of this year. So, a lot of that benefit is ahead of us. We're working hard on localization initiatives, as I mentioned before to get the right goods in the right stores. So we really feel that we've done a lot of heavy lifting, the investment is behind us. We've got some benefit this year from it; we’ll really see that there will be more benefit in ‘14 and ‘15. John Kernan - Cowen and Company: Okay, good stuff. And then just on the pricing. Have u noticed any change in the kind of umbrella or distance between your sales and some of the off-price retailers and then of course the mid-tier to (inaudible) channels hitting a lot more promotion?

We've just worked really hard on teaching and training our buyers about what really value is. They spent a lot of time in our competitive stores, competitor stores from everybody from off-price to department stores et cetera. As we execute the off-price model better, we continue to deliver more value. And that’s what’s contributing to our faster turnovers because we're selling the goods on a weekly basis fast because we're delivering more value. But I think we're getting -- we're delivering more value than we have previously. So in terms of our relationship between everyone else I think we are -- there is a bigger gap just because we’re delivering more values as an operation. John Kernan - Cowen and Company: Okay, great. Thanks a lot.

And we’ve also -- I am sorry. One other thing we’ve done is we’ve used our third parties to validate our pricing to make sure that we’re keeping everyone in line with what the prices should be.

Our next question comes from the line of Dana Telsey with Telsey Advisory Group. Please proceed with your question. Dana Telsey - Telsey Advisory Group: Good morning everyone, and nice to see the progress.

Hey, Dana. Dana Telsey - Telsey Advisory Group: Hi. As you think about the gross margin trends, are there buckets in terms of categories where there is more promotions than there were in the past or more pricing issues than there were in the past, how do you think about the categories? Thank you.

So Tom will probably want to weigh in on this as well, but as we talk about promotions, I think Tom just articulated our approach is undoubtedly to provide value every day. And everything that we have done through all the systems, all the initiatives with teaching and training the merchandising team, we’re delivering better value every day. If we are looking at the fourth quarter and -- third and fourth quarter of this year versus last year, we are one year further down the road in terms of having all those initiatives, especially as Tom indicated, in terms of being price right out of the gate and being sure that our value preposition in the fourth quarter is holding up against all of the competition. So, I don’t know if Tom you want to add to that or not.

No, I mean as far as gross margin goes, I think your question was about categories also. Dana Telsey - Telsey Advisory Group: Yes, yes.

As far as category goes, the categories that execute the off-price model the best are the ones that deliver the best gross margins. I mean it’s sort of simple, it’s pretty much comparable across the company overall but those individuals that make sure that they keep liquid and can react to the business in real time, the ones that maximize the potential of the pack and hold business. They are the ones that have the better gross margins and also the ones that are buying more opportunistically. So those are the categories, but as far as just theoretically, all of them could contribute at the same rate. Dana Telsey - Telsey Advisory Group: And as you’re thinking of your buys were up in the upcoming spring season, what are you seeing out there in the marketplace?

We continue to see a lot of great values overall in the marketplace. And we work closely with the buyers to make sure they have the understanding, the balance between what they buy upfront, what they are buying opportunistically and what they are buying in terms of pack and hold overall. So we go into the season with a clear understanding as to what that relationship should be. We're able to take advantage of a lot of pack and hold coming out of spring of this year in terms of sandals and other seasonal categories that were available based on the cooler weathers and the spring season. But we're finding as always that there is ample product to buy. And as I mentioned to Paul, we just have this huge opportunity in terms of expansion of brands which will always help us deliver more product. Dana Telsey - Telsey Advisory Group: Perfect. Thank you very much.

Thanks Dana.

Thanks Dana.

Our next question comes from the line of Karru Martinson with Deutsche Bank. Please proceed with your question. Karru Martinson - Deutsche Bank: Good morning. When you guys look at the comp sale gains where do you feel like you're picking up the market share from the [fields] coming from the off-price channel, do you think it's more from the department stores?

Not really totally share exactly who it's coming from. But as we execute the off-price model better and our comps grow, we are gaining market share from I think from a lot of different people overall. But you see this same number is coming out of third quarter that we all saw so you can determine by yourself where the market share gain is. But market share growth is going to come from execution of our off-price model across the company. Karru Martinson - Deutsche Bank: Great. And as we look at somewhat 50,000, 60,000 sweet spot for store growth, do you feel that this change is where you guys can locate your stores, what we see more of an urban focus or will it have the expansion continue as we have seen in years past?

This is Todd. I will take that one. In the end, the size of box that we can work in being more flexible just gives us more opportunities to look at real estate. As I think you are all aware, there has been a lot of real estate come on the market that’s more in this size footprint than in the larger footprint. So as we look at where we are putting stores, we basically are looking at where do the demographics and everything else that we look at from an underwriting standpoint work the best. And we are basically opportunistic in how we look at real estate most of the stores that we go into where we are second user of those. And so the way we look at it is it just opens up the potential boxes that we can go into. There is no change in strategy what we are trying to do with real estate. We are not fully penetrated in any of our large markets and we expect to continue to grow across the country. So we look at this more as it gives us incremental flexibility of the locations we can look at more than changing where we are going. Karru Martinson - Deutsche Bank: Thank you very much guys. I appreciate it.

Our next question comes from the line of Carla Casella with JP Morgan. Please proceed with your question. Carla Casella - JP Morgan: Hi. I am wondering if you can talk about how much the cold weather merchandize may have helped your gross margin in this current quarter.

Well, really that cold weather really started in October and the impact on the margin was probably not meaningful. Carla Casella - JP Morgan: Okay great. And then your bonds are callable 2014, the [OPCO] bonds and then (inaudible) bonds in ‘15. Can you just comment anything on any refinancing plans? And then also, you’ve got an ability to call some of your (inaudible) notes with proceeds from an IPO. Is that still in place that you could do that by 2014 or is that something you have to do it right at the time of the IPO?

Hi Carla, this is Bob LaPenta, I’ll take the call. First of all it’s the, the [OPCOs] are callable in ‘15 and the (inaudible) are callable in ‘14, so it’s the other way around. And we used all of the proceeds from the IPO to pay down the (inaudible) notes. There is still some availability in the restricted payment basket to give us the opportunity after February of 2014 to pay down additional OPCO notes. But again all those opportunities we’ll look at next year to decide what's the right thing to do for the capital structure. Carla Casella - JP Morgan: Okay. Great thanks.

Thank you. Our final question comes from the line of [Karen Aldrich with Mitsubishi]. Please proceed with your question.

Thank you. Can you maybe give us an update on how direct is progressing and as you build out that business what kind of opportunities you are seeing?

You are referring to eCommerce?

Yes, sorry, yes.

Okay. I’ll take that one.

And also, sorry, how do the margins compare at this point for direct versus retail?

Okay. I'll take the eCommerce question as it relates to the business. We've been in the eCommerce business for many, many years now and it’s had some good growth over the last couple of years. As a percent of total it’s still very small. We're not probably going to get to the similar levels of some of the mid-tier department stores or other department stores just because the nature of the off-price that limits us to a certain degree. As to what we can communicate to the customer on our eCommerce site, there is a lot of restriction in terms of what names we name on that site. So we're going to continue to grow, we're going to have nice growth overall. But as a percent of total it’s not going to be -- it’s not going to be the same as other more traditional department stores that have a different model than we have overall. But we continue to add product on to the site and it’s growing and we feel good about what’s currently happening there. From a profitability point of view it’s really not even we're discussing just because it’s as a percent of total it’s very, very low.

And what kind of information data mining can you do from there and has it helped you in terms of determining which markets you want to expand into?

Well, there is always opportunity for understanding who is interacting with us on our eCommerce site overall. It gives us just another data point in terms of attracting different customers, but based on the level of and the maturity of our eCommerce business it’s just it’s helpful, but it’s not a primary driver of where we're going to get information about our customers at this point in time.

Great. And final question where are you hoping to end with inventories by year-end?

This is Todd. I’ll take that one we haven’t given any specific inventory guidance, but I think the key thing to keep in mind is we’ve been working hard over the last several years to make sure that we’re doing everything we can to make the shopping experience as good as it can be in our stores. And one of the key elements of that along with sizing and navigation and all the other things we’ve done in the store is to basically have the inventory levels appropriate to make it easy to shop and to have what our customers are looking for. And with all the tools and the teams that we’ve put in place one of the key things we are trying to do is consistently be more efficient at the store level and to continue to drive those inventories down. So we’ll continue to look at that as a goal for the next couple of years to have less comp store inventory at the end of the year, there is not a hard target there. But the one other thing I would mention is as we work our way through the rest of this holiday season what we do with pack and hold inventory is going to be based upon what inventory is available that we think meets our financial hurdles and meet our model. So we’ll -- that inventory reflects as we think is appropriate to help us in the spring and in the fall of next year. So one way of saying we expect our comp store inventories to be down a little bit and overall inventories to take advantage of what’s available in the market.

Great. Thank you very much.

Okay. Thank you.

I would now like to turn the floor back over to management for closing comments.

Well, thank you all again for your participation on today’s call. Again we are extremely excited to reenter the public equity market and excited about our current performance and momentum as we head into the fourth quarter and 2014. We look forward to updating you on our performance on future quarterly calls and thank you again for your continued interest in Burlington Stores. Have a great day. Thanks everybody.

Ladies and gentlemen, this does conclude today’s teleconference. You may disconnect your lines at this time. Thank you for your participation. And have a wonderful day.