Todd Vogensen - Vice President of Investor Relations David F. Dyer - Chief Executive Officer, President, Director and Member of Executive Committee Pamela K. Knous - Chief Financial Officer, Chief Accounting Officer, Executive Vice President and Treasurer

Neely J.N. Tamminga - Piper Jaffray Companies, Research Division Lizabeth Dunn - Macquarie Research Pamela Nagler Quintiliano - SunTrust Robinson Humphrey, Inc., Research Division Susan K. Anderson - FBR Capital Markets & Co., Research Division Adrienne Tennant - Janney Montgomery Scott LLC, Research Division Anna A. Andreeva - Oppenheimer & Co. Inc., Research Division Tracy Kogan - Wells Fargo Securities, LLC, Research Division Edward J. Yruma - KeyBanc Capital Markets Inc., Research Division Dana Lauren Telsey - Telsey Advisory Group LLC Betty Y. Chen - Wedbush Securities Inc., Research Division Paul Alexander - BofA Merrill Lynch, Research Division Kimberly C. Greenberger - Morgan Stanley, Research Division Elizabeth O. Pierce - Ascendiant Capital Markets LLC, Research Division Marni Shapiro - The Retail Tracker Richard Ellis Jaffe - Stifel, Nicolaus & Co., Inc., Research Division Brian J. Tunick - JP Morgan Chase & Co, Research Division

Good morning, and welcome to the Chico's FAS, Inc. Second Quarter 2013 Financial Results Conference Call. [Operator Instructions] I would now like to turn the conference over to Mr. Todd Vogensen, Vice President, Investor Relations. Please go ahead, sir.

Thanks, Denise, and good morning, everyone. Welcome to the Chico's FAS Second Quarter Earnings Conference Call and Webcast. Joining me today at our National Store Support Center in Fort Myers are Dave Dyer, CEO; and Pam Knous, CFO. Before Dave begins his executive overview, we'd like to remind you that our discussions this morning include forward-looking statements and quarter-to-date data points, which are subject to and protected by the Safe Harbor statement found in our SEC filings and in today's earnings release. These forward-looking statements are subject to a number of factors and uncertainties that could cause actual results to differ materially. The company does not take -- undertake to publicly update or revise its forward-looking statements, even if experience or future changes make it clear that projected results expressed or implied by such statements will not be realized. And with that, I will turn it over to Dave. David F. Dyer: Great. Thanks, Todd, and good morning, everyone. Well, I've always said that fashion is not for the faint of heart, and luckily, I have a strong heart, and even the best of companies can sometimes experience disappointing results. So clearly, our second quarter performance fell short of our goals. Without any embellishment or spin, here's what happened. Traffic was our issue in the first quarter due to unseasonably cool weather. Traffic was also our issue in the second quarter. We were just not able to drive sufficient traffic to cycle against the record results from the second quarter of last year. Therefore, total sales for the quarter were up 1.2% to $650 million, with comparable sales of negative 2.6% versus comparable sales up 5.6% last year. To put these figures into perspective, Chico's brand faced a significant challenge, up against a strong second quarter comparable sales in 2012. In the end, Chico's was not able to overcome the record spring 2012 results driven by color, prints and pattern. Also, with the benefit of hindsight in the second quarter, White House | Black Market flowed too much color too frequently for the season. I'd like to point out that we have returned to a more normal color cadence and color pallette in our fall assortment, which, by the way, we're very excited about, and we believe our customers will be excited about this, too. Boston Proper sales were down about 9% for the quarter and although better than the first quarter run rate, the second quarter's performance was still not up to our expectations. By contrast, Soma continues to perform well. We saw continued momentum at Soma Intimates, building upon the strength of its new Stunning Support bra, which helped us overcome the challenging traffic to drive mid-single-digit comparable sales increases. As many of you noted from visiting our stores and viewing us online, we aggressively cleared inventories in the second quarter. While this activity impacted our margins, the outcome was strong cash flow generation. We delivered $80 million in operating cash flow, and we're able to reinvest those dollars to fund future growth initiatives and return approximately $34 million to shareholders through our dividend and repurchase programs. We will continue to enhance shareholder value through these and other initiatives. As we transition into fall, we're now in the fourth week of the third quarter. As reported on our unaudited daily sales flash through yesterday, our quarter-to-date company sales totals are up 4.9%. These results are on top of a prior year quarter to date comparable sales up 10% and total sales increases of 20%, which included the incremental impact of Boston Proper. Before I turn the call over to Pam, I'd like to state that absolutely nothing in these results diminishes our confidence in our portfolio of brands, our ability to continue to deliver value to our shareholders and our commitment to our long-term growth plan. A component of this plan is our omni-channel strategy, which we're very pleased with our progress. I'll be back after Pam's update to provide more information on this initiative. In the meantime, here's Pam. Pamela K. Knous: Thanks, Dave, and good morning, everyone. Net sales were $650 million in quarter 2, an increase of 1.2% compared to 2012. Earnings per share were $0.27 per share versus last year's record $0.32 per share. As Dave just said, traffic was our issue in quarter 2. In a highly promotional and challenging environment, comparable sales results was a negative 2.6% on top of a positive 5.6% last year and a positive 12.8% in 2011. As you probably recall, in quarter 2, the Chico's brand was cycling its first full quarter of the So Slimming Jean launch, as well as last year's exceptionally strong color and pattern trend. The Chico's/Soma combined comparable sales were up 7.2% last year on top of up 11.9% in 2011. So even with the expansion of our So Slimming technologies into tank tops and more bottoms, Chico's sales declined primarily as a result of lower traffic and the cycling of the record sales performance last year. White House | Black Market delivered its first negative comp in 17 quarters, cycling comparable sales of up 2.3% last year and up 14.9% in 2011. An over-delivery of color in the second quarter did not resonate well with customers, which added to challenging mall traffic. Good news, we have already adjusted color flows with our fall deliveries. Soma's new Stunning Support bra is looking very promising. We are so pleased with the results from its May launch, which drove a mid-single-digit comp on top of a double-digit comp last year, as well as record sales and gross margin dollars this quarter. Boston Proper sales decreased in the second quarter by 9%. Although below plan, this was an improvement from our run rate in the first quarter. Boston Proper eliminated an unproductive catalog this quarter as it fine-tunes its promotional calendar to match its future store merchandising cadence. Also, as we've commented in the first quarter, we are not cycling markdown units from last year, and I'm pleased to say that we have started to deliver the related gross margin improvement. Boston Proper's initial 2 stores, which opened in the first quarter, are continuing to perform above expectation. Last week, we opened our third Boston Proper store in downtown Naples, and our fourth Boston Proper store will open next month at St. Armands Circle in Sarasota. These 4 stores are allowing us to test store sizes, location types and adjacencies, among other things. Gross margin in the quarter was 54.8%, 160 basis points below last year as we moved aggressively to sell through our seasonal inventories. Note that we were cycling strong full-price selling from last year and the highest second quarter gross margin rate in 5 years. At quarter end, in-store inventory per selling square foot decreased by 1.4% on top of last year's 6.8% decrease. Excluding the shift from last year's 53rd week, total inventories increased approximately 2.1% at quarter end, in line with planned sales levels as we start the fall season, which includes 112 net new stores since this time last year. SG&A in the quarter was 44.0%, up 100 basis points to last year, primarily due to the deleverage of occupancy and marketing expenses and the investments in our strategic initiatives, which approximated 20 basis points of the increase. We were pleased with the total company effort in this difficult sales environment to manage our expense dollars to less than a 4% increase, which also included the true-up of incentive compensation. Our new store growth continues to be a key element of our omni-channel strategy, as our increased square footage provides customers the ability to touch and feel our fashion, as well as experience our Most Amazing Personal Service. We opened 33 new stores this quarter, for a total of 112 net new stores compared to last year. And we are on pace to open 135 to 140 new stores in 2013, including 4 Boston Proper stores and 3 Canadian stores for White House | Black Market. Our new stores continue to perform well. As we reached the halfway point in the year, we are pleased with the progress on our strategic initiatives. Capital expenditures totaled $37 million in the quarter, primarily for store growth initiatives. We are on track to spend approximately $140 million in capital expenditures in 2013, including improvements in the omni-channel experience, new store growth, opening our first Canadian stores and testing our first Boston Proper stores. We remain positive about our path forward and confident in our investments. For the second half, we face challenging comparisons. We are up against a 9.9% comparable sales increase in the third quarter last year, our strongest result in 2012, which represented one of our best transitions from spring to fall in many years. Quarter 3 in 2012 was driven by the strength of Chico's So Slimming and White House | Black Market's WORKKIT, which actualized into gross margin improvement last year of 120 basis points. Looking forward to our fall assortments. Our merchants and designers have developed products that truly demonstrate each brand's unique fashion aesthetic. For example, for Chico's, the jacket is again an important wardrobing category in which we excel. And we have some great jackets in our lineup, along with an expanded "9 to fabulous" assortment. Also, we hope you check out Chico's first online exclusive shoe offering. White House | Black Market's focus for fall features bold black-and-white graphics, with additional styles and depth in the instantly slimming dress, which is performing exceptionally well. Soma has added fall TV to further market our successful spring launch of the Stunning Support bra. And Boston Proper has elevated the design of its fall merchandise and catalog visuals to better highlight its unique merchandise through a less dense but more impactful presentation. The fall merchandise features shine and texture to enhance a neutral color palette, which we believe will resonate with our customer. We now recognize that with the extent of changes at Boston Proper, including the brand realignment and the focus on preparing to launch 15 to 20 Boston Proper stores in 2014, Boston Proper sales could remain challenged in the second half. As regards third quarter ending inventory levels, we will own more holiday merchandise in the third quarter this year as a result of the 53rd week calendar shift and the timing of Thanksgiving and Christmas. This calendar shift will result in an approximate double-digit percentage increase in total inventory dollars year-over-year at the end of the third quarter, which will also include approximately 115 to 120 net new stores. We plan for inventory to return to a more normal pattern and to increase in line with sales at year-end. In the fourth quarter, we will be cycling a 3.7% comparable sales increase and a 90-basis-point improvement in gross margin. We have planned a number of exciting and unique merchandising initiatives, along with enhanced gifting, supported by both new web functionality and capabilities of our automated DC, which we expect to provide strong customer interest this holiday season. Despite ongoing soft traffic, it is our job to stay focused on our customers and to execute to our plans. As we look to the second half of 2013, that is what we are doing. And absent other macro factors, we believe our merchandise strategies will improve our sales trends. With that, I turn it back to Dave. David F. Dyer: Great. Thanks, Pam. As many of you know, we've taken an opportunity in recent calls to discuss the specific aspects of our strategic plan that we believe will lead to future growth and success. On today's call, I'd like to take a few minutes to discuss the strategic imperative that's become a buzzword across a range of industries these days. I'm referring to that ubiquitous O word, omni-channel. Buzzword or not, there's no question in my mind that omni-channel will be a crucial component to retail success over the coming years. Piecing together the omni-channel puzzle will be essential for brands to forge lasting connections with their customers. Personally, I need no convincing. No "Omni-channel for Dummies" manual here to appreciate the importance of linking merchandising, messaging and marketing across all channels, be they front line, online, offline or whatever lines that technology will throw our way. Up-to-date myself with opening and operating new channels and making sure they're aligned is something I spend a lot of time thinking about for a good decade and a half, if not more. When I became CEO of Lands' End way back in 1998, it was clear to me and my forward-looking management team that e-commerce in general and multichannel in particular was a hurricane force to be reckoned with. We needed to make sure that our creative, marketing and merchant teams were multichannel lingual. We needed to make sure our brand's identity and voice were the same no matter which channel. And we made a -- and we needed to make sure we just didn't follow the curve of fast-moving technology but to stay at or near the forefront of that curve. Today, we and other retailers are facing a more complicated mosaic, how to seamlessly weave together the customer experience, brand identity and social community and put all the puzzle pieces together in stores and websites and mobile platforms, online community hubs, new technology, new in-store technologies and more. These are all questions and opportunities we address continuously at the company today, both at our campus in Fort Myers and in the field. Back in early May of this year, we brought our store managers together for meetings in Orlando, and one of the highlights was an inspiring video that we produced on the future customer experience. We also showed this video to many of you at our distribution center tour in June. This video is entitled "The Shopping Experience of the Future," which showed a vision of the not-so-distant road ahead, how the customer experience could and should smoothly extend from a TV commercial to a website, to a mobile device, to a styling appointment in a boutique, to an online product rating, to a conversation on Facebook. Science fiction? Well, maybe so 10 years ago but not anymore. Our team totally got it. Now on to our first quarter call, you can remember I shared the strides we've made in a very important piece of the omni-channel puzzle, social media. Our investments in social are now bearing fruit. Well over 1 million Facebook fans, up 300% in the past year. YouTube videos have been viewed well over 2 million times and counting. Now we're infusing our Facebook pages with contests, games, promotions, live chats with our heads of store and brand presidents, you name it. I said how pleased we were with our performance in this area. Well, it turns out, we're not the only one excited about our efforts in social and beyond. Since that call, just last month, a leading digital think tank, L2, based in New York, came out with its annual assessment of specialty retailers. It rated us in terms of what the think tank calls a brand's Digital IQ Index. Among factors that go into the ratings: progress on the mobile front, how well website delivers on customer service, navigation, check-out and other features. Two brands of ours that L2 rated, Chico's and White House | Black Market, both achieved gifted ratings from L2. White House, in particular, was ranked #8 out of the 71 retailers that L2 studied, with Chico's only 12 slots behind. It's remarkable progress and only one reason among the many that we're feeling so good about our omni-channel efforts. The list of enhancements we've made is long and diverse. All of our websites now carry ratings and reviews. We've optimized our store locator. We offer 24/7 live customer service, which, I was surprised to learn, is offered by only 10% of the retailers today. The same goes for live chat, which only 28% offer, and product videos, only 27% offer. Our loyalty programs afford industry-leading customer capture rates at over 90%, which allows us to track the performance of many of our online marketing programs across channels. Most recently, our new Boston Proper stores, we've taken further steps to seamlessly connect store and online, with dazzling technology tables in every dressing room area. Here, customers and associates can easily shop the brand's either online collection, providing endless aisles of size and color options, as well as styles not available in the boutique, and providing stylists access to recommendations and wardrobes options to further personalize the shopping experience. Results to date have far outstripped our expectations. So stay tuned for further developments in mobile, gifting and new product categories that may be offered in certain channels, but marketed via all of them. To wrap it up, while our recent results do not meet our expectations, there is a number of indicators that give us confidence in our strategic initiatives, which we believe position us for strong growth over the long term, including ongoing square footage growth at a high-single-digit rate, omni-channel growth just as I outlined, Soma's continued momentum, store growth for Boston Proper, continued international expansion with our first White House | Black Market Canadian stores opening in the third quarter and revolutionary merchandise innovations across all brands. We continue to be motivated by our customers every day and by our future growth prospects. We look forward to updating you on our progress ahead. And with that, I want to turn it back over to Todd.

All right. Thank you, Dave. That concludes our prepared comments. At this time, we'd be happy to take your questions. [Operator Instructions] And with that, I will turn the call back over to Denise.

[Operator Instructions] And our first question will come from Neely Tamminga of Piper Jaffray. Neely J.N. Tamminga - Piper Jaffray Companies, Research Division: Dave, I was just wondering if we can talk just a little bit about White House. It sounds like there's been a course correction here, some color flows. I'm just wondering if you're able to share a little bit as it relates to the late August, September kind of early build -- the natural build of the business and how you're feeling about it heading into Q3, Q4. And then, any changes related to your long-term view of the growth? And if you could weave in a little bit. I love that you talked about omni-channel and what that means for your business. What does that mean specifically for White House? And does that impact the longer term view of the store count for White House over time? Just if you could give us a little bit of insights on the digital front there, that would be helpful. David F. Dyer: Neely, somehow you managed to weave about 85 questions into one, but we'll do our best. White House just had too much color too consistently in the second quarter. And I think that if you go back and look at our history, what we have done is we've kind of come in and had a cleansing pallette. It's almost like sorbet between courses. We would have color and then we would go back to really a black-and-white delivery to kind of clean it up and to let things kind of get back to normal and to really settle down in that other color. We brought in color consecutively, in consecutive deliveries, and changed color. I just -- and I think that we had another one of the reds or pinks, we felt like, that we have repeated too quickly. So when we went back and looked at it, we really did realize that, that color cadence and the amount of color that we brought in, in such a short amount of time was a problem. So we have corrected that. You will see the sorbet course as we go forward. And we will be cleansing our pallette of color as we have done previously, and we believe that, that will get us back to where we've always been. Also in White House, we're going to continue to make sure that our affordable couture and unique product position is enhanced. Perhaps some of the really exciting items that we always put in that were the very difficult ones, we didn't have enough of that balance in our assortments, so we've corrected that going forward. And now the other questions.

Omni-channel. David F. Dyer: Omni-channel for White House. Well, White House has kind of led on omni-channel. I think when you look at social media, they have been one of the strongest in social media, in integrating that in. They have a very strong direct-to-consumer piece, which is kind of seamless in the store. And while Boston Proper, being our smallest division, has been the most experimental with these tech tables in the fitting rooms, I think you'll see the other brands, as we get the technology stabilized, following soon behind. I mean, it requires, in some places, a different fitting room setup we will introduce in the new stores. But I think that we are making very, very good progress. I mean, we're working on the iPad to optimize tablets, our new POS system, which is being introduced in our Canadian stores and then starting to roll out -- tested and rolled out next spring, will certainly allow for mobile technology, pads, tablets, anything that we want to throw at it with technology. So there's just a lot of things coming down the road, and we're trying to seamlessly integrate all these channels. I mean, honestly, we don't care where we get a sale or where the sale was initiated or generated or field from. If you do a locate in store, it's a store credit even though it's shipped from DTC. It just doesn't matter to us. We look at it seamlessly as one big channel, and we just want to do the best that we can to serve the customer whenever, however and wherever she wants to be served.

Our next question will come from Liz Dunn of Macquarie. Lizabeth Dunn - Macquarie Research: I was wondering if you could add some color to just your comments about the quarter-to-date. Is that improvement more driven by traffic or other factors? And is it consistent across the brands? David F. Dyer: I would say the improvement is consistent across the brands. I would say that traffic still remains a challenge, and I think that we're working hard to live within the traffic environment that we are -- have been dealt. I mean, we're playing the hand that we're dealt well. But one thing that I think that is an interesting point in all of this, again, our conversion is at an all-time high. When the customer comes in the store, we convert her to sales. So we just need more coming into the stores. And I think that since the environment is such that it is not producing natural traffic, we just have to work harder to produce our own. Lizabeth Dunn - Macquarie Research: Is there anything you're doing on the marketing front to improve the traffic trends? David F. Dyer: Yes. Lizabeth Dunn - Macquarie Research: Could you talk about it? David F. Dyer: I think there's a lot of things that we're doing in terms of looking at promotions, offers, the way that we're doing our online marketing, the targeting that we're doing, things that we're doing in prospecting, certainly, our television commercials, which I think that you've just seen launch for Chico's, White House is not quite yet. You'll see new television commercials coming out in White House. But there's a lot of things that we're doing. And these television commercials for White House will be more item-specific, too. So rather than just drive brand awareness, we're going to drive product sales. So we think that there's -- we need to create reasons to buy and reasons to come into our stores to shop, and that's what we're working on.

Our next question will come from Pamela Quintiliano of SunTrust. Pamela Nagler Quintiliano - SunTrust Robinson Humphrey, Inc., Research Division: Just had a few questions. One very quick one, any difference on, on- versus off-mall locations and performance throughout the quarter? And if you could also, and I apologize if I missed this, but just talk about the progression of comps throughout the quarter. And then very broad-based question, but why do you think it is she's not shopping? Because with your customer, one would think the housing market improving, the stock market improving, she would feel somewhat better. But why do you think it is that she's just not inspired to actually go to the stores? David F. Dyer: Well, let me just say that all boats seem to be rising and lowering with the tide. We haven't noticed any difference geographically or in off-mall or on-mall. It's all very consistent across. And I think it's also consistent across brand when we look at traffic. So I think that there is a traffic issue, but obviously, there are going to be winners and losers in this scenario. We just want to win, and that's what we're working hard to do. I will tell you that, yes, you're right that normally when the market has performed as well as it is, and certainly for our customer, you may expect more. But from -- I could tell you personally, I owned auto dealers and we are selling more autos than we have ever sold in years. So perhaps, as I have read, she is spending more money on larger purchases at this time. And so what our job really is, when it comes down to apparel, is just to get our unfair share of apparel sales. And that's what we're working hard to do. Pamela Nagler Quintiliano - SunTrust Robinson Humphrey, Inc., Research Division: And you were able to tweak some of the product that was working in Q2 and chase that? David F. Dyer: Absolutely. We are going back and looking and making tweaks and reacting as quickly as we can and perhaps reacting a lot quicker than we would have in the past just because we think that we can make changes, and we like to be nimble at times like this.

Our next question will come from Susan Anderson of FBR. Susan K. Anderson - FBR Capital Markets & Co., Research Division: I was wondering if you can maybe talk about the promotional and competitive environment year-to-date so far in this quarter versus what you've found in the second quarter and then maybe your expectations for the back half of the year. David F. Dyer: Well, I think it has been a promotional environment out there, and I think that, that's been caused largely by people trying to move inventories. That's one of the things that I believe firmly in is in the way that we control and manage our inventories and is -- as a matter of fact, that's one of the reasons that we have kind of an unusual structure, where the inventory areas report directly into finance. I see that as one of our biggest assets that needs to be managed without -- what would I say, that needs to be managed realistically and without the hope that sometimes may appear from a merchant's perspective. It needs to be counterbalanced with the sound financial disciplines. And that's the way we manage it. And yes, as soon as we saw that we weren't making our plan, we've got very aggressive on taking a look at our inventory, and I think a testament of that is the way we ended the third -- the second quarter and as we enter the first quarter. I mean, we're entering with very, very clean inventories, which positions us well for the future. Now others may or may not be in the same condition and depending on how their inventories are, it will depend on how promotional the environment will be. And if traffic continues the way it is, I would expect that it will be very promotional for the rest of the year. Susan K. Anderson - FBR Capital Markets & Co., Research Division: Great, that's really helpful. And just a clarification on your comments on the White House | Black Market product and too much color. So do you think that you kind of, like, cycled through that and now you fixed the issue for the back half now? David F. Dyer: The answer is yes. I reviewed all the assortments, obviously, through holiday, very recently, and I think that our assortments brand for brand look very, very good. So I don't think that we have assortment problems going into holiday at all from my recent reviews.

Question will come from Adrienne Tennant of Janney Capital. Adrienne Tennant - Janney Montgomery Scott LLC, Research Division: So my first question is can you talk about the spread between total sales growth and the approximately 8.8%, I believe it was square footage growth less comp? And basically, sort of that implied non-comp productivity. Is that largely due to a shift in the store opening mix at -- toward Soma? And then my follow-up is just for Pam. On SG&A dollar growth for the back half, should we expect it to still be dollar slightly up year-on-year?

Yes. In terms of new stores, there's a lot that goes into it. Certainly, part of it is mix between the brands. And yes, you are seeing relatively more Soma openings versus last year. It's also a little bit of timing of when those stores are opening. And I think, really, probably the best takeaway is as we're looking at it, we are happy with the rate of sales that our new stores are generating and continue to be pleased with our new stores. David F. Dyer: Pam? Pamela K. Knous: And then on the SG&A, yes, we would -- we're managing our expenses. Dave has inserted a very cost-conscious environment here. We are planning to control what we can control so we are monitoring our expenses very closely as we look to the back half. We were up about 4% in the second quarter and in a very difficult sales environment, so that probably is a pretty good indicator of where we might be in the back half. David F. Dyer: Yes, we're really focusing on controlling the controllables. And that is, we can control certainly our inventory, our expense, and we can control our marketing and our product assortment. I can't control the economy in general, but what we can control, we're all over.

Our next question will come from Anna Andreeva of Oppenheimer. Anna A. Andreeva - Oppenheimer & Co. Inc., Research Division: Just a follow-up on the monthly cadence during the quarter. I guess, it seems to imply that trends flowed as the quarter progressed, which, I guess, is what we heard from other retailers as well. But should we think July was the weakest month of the quarter and quarter-to-date comps are running flattish? And then to Pam, can you maybe break out the DC automation cost drag in your gross margin? And should that continue into the back half?

Yes. I would say in terms of the monthly cadence, when we released earnings, we said -- last quarter, we said that our total sales were running up 1%. And we ended the quarter up 1%. So I think that tells you that we're relatively consistent across the course of the quarter. Pamela K. Knous: And as far as our DC automation, we did quantify the total investment that we had in that facility. It was in the $30 million range, and that was something that was, say, fully implemented by third quarter of last year. And as we have shared, we believe that those investments position us well for, say, the next 5 years. So we have added a lot to our capacity. That is relatively new technology. We are continuing to fine-tune it. And what we said last quarter is we would anticipate that there would be a cost or an unfavorable comparison year-over-year for all of 2013 as we fine-tune that investment, but we would expect that the benefits that we have planned for will start to materialize in 2014.

Our next question will come from Paul Lejuez of Wells Fargo. Tracy Kogan - Wells Fargo Securities, LLC, Research Division: This is Tracy filling in for Paul. I just had a follow-up on the last question about the cadence of comps during the quarter. Was there any falloff, I'm just curious, within the brands? Because it seems like White House | Black Market had been doing relatively well. And I was just wondering if that color issue was an issue more in July versus earlier in the quarter?

Really, the 2 big colors for the quarter were the flame red and espresso brown, and those were around for really most of the quarter. So I don't know if that helps to answer your question, but overall, relatively consistent again across the quarter. Tracy Kogan - Wells Fargo Securities, LLC, Research Division: And then just another question on the AUC. What were your average unit costs looking like in the quarter? And what should we think about for the back half? Pamela K. Knous: Actually, our team has done a really amazing job managing AUCs. As Dave says, this is one of the items we can control. So we have done, really, a tremendous job on managing that. I will point out that a jean that has So Slimming technology in it or a Perfect Form dress that has that technology in it, those are items that are going to be at a higher cost than something that doesn't have that technology in it. But on an apples-to-apples comparison, we have had very, very strong control over AUC. Tracy Kogan - Wells Fargo Securities, LLC, Research Division: So you're not seeing significant cost increases, you're managing those away and you'd say that would be similar in the back half? Pamela K. Knous: Yes.

Our next question will come from Edward Yruma of KeyBanc. Edward J. Yruma - KeyBanc Capital Markets Inc., Research Division: I wanted to drill down a little bit on Boston Proper. I know that last year and kind of earlier this year, you suffered from some integration challenges. I guess just want to drill down a little bit on the weakness and why you expect that weakness to persist through the back half. Is it merchandising? Or is it still kind of repositioning of the business? David F. Dyer: I think it's probably still repositioning of the business, and I think also that one of the things that is happening for most direct marketers is they're prospecting efforts are becoming harder and harder and more and more expensive. And I think that as you take a look and see, the acquisition of new customers has been an issue, and actually, it's the cost of acquisition of new customers is really the issue. Response rates that traditionally people would see for prospecting, from what I've seen and heard across the industry, as well as what I've observed internally, are a heck of a lot less than they used to be. So I think that the customer is just getting inundated with media, and that's why the whole electronic and the multichannel really is the way to go. The stores, though, I can't wait to get 100 of them. They have been nothing short of spectacular. They have exceeded our expectations. Their dollars per square foot are well above the company average, in the ones that we have opened so far, and we are very, very pleased with their performance. I think just a testament, to watch the customers show up to these new store openings is absolutely incredible. So I think that some of the issues that we're having now will be temporary. And over the next couple of years, as we get more and more stores, the recognition for the brand, the reach of the brand, the ability to do different types of marketing, such as television, whether it be regional or local, will be a very important part of our strategy. One of the things we're doing with opening their stores is rather than trying to open them coast to coast, border to border, like we did with Soma, 70 stores coast-to-coast, border to border, we're really trying to go in and concentrate in areas where we can build massive stores like southeast, southwest Florida. And then, we're going to obviously go into the Texas areas, and we'll go into Arizona. But we're going to go in with multiple stores so we can get the efficiency of our marketing and media dollars.

Our next question will come from Dana Telsey of Telsey Advisory Group. Dana Lauren Telsey - Telsey Advisory Group LLC: As you think of the 3 brands and you had key items in each of the brands, what's the next iteration? And how do you see pricing evolving in this more competitive environment? Does it adjust the margin structure? David F. Dyer: Well, I think that they're -- both things need to happen. I mean, key items have been very important to us. So when you look at the So Slimming technology that we had, when we first introduced that So Slimming Jean, it was nothing short of incredible. And we've had similar results as we've put that technology into other products. I mean, there will be other things that will be coming down the pipe, just as that one kind of came out of the blue. I'm sure we'll find other products that we can drive equally well. So Slimming or that slimming technology has also worked very, very well in White House | Black Market, with their instantly slimming dress, which they have sold amazingly well. But their Perfect Form pants, while not having any slimming technology in it, just the way that, that fabric functions and feels, performed some of the same idea. So we're constantly looking for items, but it's not only -- our business has never been one that is predominantly driven by big items like others. I mean, it can be an important part of our mix, but we still are a collections business. We sell outfits. We provide service. We sell head to toe, shoes to the necklace and every part in between, under and over. So that really is what we're all about. And I think that we need to continue to build uniqueness and breadth in our assortments, as well as have some of the big predictable items that can -- those are the ones that are serving as the traffic generators, that are getting people in our stores. If we can get them in for one of the big items, then we have the opportunity to show them how terrific they're going to look in a complete outfit. Dana Lauren Telsey - Telsey Advisory Group LLC: Has the competitive environment changed for any of the items? And has it changed online or in retail stores from what you see? David F. Dyer: Competitive environment, no, I don't think -- I mean, in terms of the amount of competitors in our space, the answer is no. I think if anything, it's just gotten more promotional, and that's really the thing. If you go back to your other question though, too, what I was going to say is we also had shoes that we're adding across both brands. We've got Black Label and Chico's. We added golf in Chico's, which is going to be rolled out to quite a few stores. And we've done "9 to fabulous," which is workwear in Chico's. So we are going out and doing product innovation, new classifications, new items, new ways to entice her to come in and shop.

Our next question will come from Betty Chen of Wedbush Securities. Betty Y. Chen - Wedbush Securities Inc., Research Division: I was wondering, Dave or Pam, could you talk a little bit -- it sounds like, clearly, we're going to continue to see investments behind marketing, with White House returning back to TV. What does that mean in terms of marketing dollars? Is that going to be moving up year-over-year? And should we anticipate that you could have more cadence [ph] on TV this year as an effort to drive more traffic to the stores? And then separately, in terms of So Slimming, clearly, we're still lapping a huge So Slimming business a year ago. But any learnings from that launch into tops in the first half that could be helpful into the second half? David F. Dyer: Well, in terms of marketing dollars, we're not increasing the marketing dollars. We're spending them more wisely. We're spending them differently. I mean, we look at it now in a mix. The traditional mix that we had, which was heavily relied on print, is now we have not only television, but we have e-com and we have the online marketing, digital advertising and we have social media. And we're looking at a balanced marketing budget. Our marketing is kind of growing as our sales grow. So we're not looking really to increase the percent of sales anymore than we have. However, if we get a -- at this outset, we say if we get a great idea or a great product, we may invest in it. That's just one of the things that we will do. Our company is in a position that we can invest in things that we believe are going to provide us with the adequate return. And then there was another part to that question, too.

Any learnings from So Slimming in first half as we go into second half. David F. Dyer: Any learnings from So Slimming in first half? Well, we just came up against such a very strong launch from the previous year. Our launch was just absolutely unbelievable the previous year, and we're up against it. And perhaps -- I don't know what to say. I wish that maybe I would have introduced maybe some other products a little earlier in the season or gotten behind them in marketing a little bit better. But overall, I'm pretty happy with the assortment.

And we do have more expansion in So Slimming coming. Pamela K. Knous: Right. David F. Dyer: Well, that's true. You'll see it right now. You'll see it in skirts that we have added. We see it in some tops and dresses. Pamela K. Knous: Boston Proper has brought it into jeans and things, so really... David F. Dyer: Yes. So we've got a lot of technology working in the brands that I wish maybe we would have a little bit more a little earlier. But sometimes the development cycle takes a while to get it right.

Our next question will come from Lorraine Hutchinson of Bank of America Merrill Lynch. Paul Alexander - BofA Merrill Lynch, Research Division: It's Paul for Lorraine. Can you give us a little bit more on SG&A? With SG&A up for the second half at a similar rate as the second quarter and knowing that you're investing in your strategic initiatives and marketing is going to be flattish, what are the buckets of spending where you can cut or are cutting? And if trends decelerate further, where do you have the most flexibility to cut more? Would you slow the pace of strategic investments at all? Or would you consider pulling back on the pace of store expansion or actually making -- having marketing go down? Pamela K. Knous: We are firmly committed to our strategies for long-term growth. So absolutely not, we would not be cutting down on our strategic investments nor at this point would we be making any reduction in our new store count. As we have talked about, our new stores are performing well. We feel very -- we're very pleased that we are a brand -- a portfolio of brands where we have the ability to grow square footage by approximately 8% or better per year. And we -- there's nothing in these 1 quarter results that would cause us to think any different about our capacity for new store growth. David F. Dyer: And I'll remind you, we have no debt and $300 million in cash or something like that. So we have the ability, as long as we think we're going to get the right return and we do. We measure our return on net assets, and we are very aware of that. And as long as we think we can get the right return, we'll continue to invest.

Our next question will come from Kimberly Greenberger of Morgan Stanley. Kimberly C. Greenberger - Morgan Stanley, Research Division: Dave, I'm wondering if you can talk about other categories that you think your consumer might be spending on right now. You mentioned auto sales. But I don't know if you've done any customer research or if you have any anecdotal information that you can share with us. And then if you could just remind me, what did you say your comp so far here in August is running? And is this your toughest comparison of third quarter? David F. Dyer: Yes, it is our toughest comparative of third quarter. Our comp is positive, but we're not doing it specifically. We're releasing the total sales, which we said was 4.9%. Anecdotally, I mean, I just said, I mean, we're selling a lot of Chevrolets. I've watched the auto industry pretty well. When I say we, it means that my kids' auto dealers are selling lots of Chevrolets, Mazdas and Subarus. And then, anecdotally, if you look at Home Depot and Lowe's and those types of things, you see what's happening with homebuilding and with home remodeling. I just think that perhaps some of the customers are spending on more major purchases right now. And I think that -- this, too, will pass. She can't wait too long before she needs a new outfit. So I am always very optimistic and appreciative of our customers' ability to need more clothing. Pamela K. Knous: We agree in that.

Our next question will come from Liz Pierce of Ascendiant Capital Markets. Elizabeth O. Pierce - Ascendiant Capital Markets LLC, Research Division: Dave, you kind of addressed this on Dana's questions. But at Chico's, it seems that the collection kind of mentality is becoming -- it's kind of dominating the store with the 9 to 5, So Slimming, Zenergy, et cetera. And I was wondering particularly on the pants side, on the bottoms side, after talking to some of the associates and myself, just trying to understand all the different bottoms and some of the out of stocks, is it sometimes -- has it been over-assorted or sometimes too confusing for the customer? David F. Dyer: I don't know that it's been over-assorting. It's -- perhaps at point of sale, we haven't really expressed it as well as we should have. I think if you noticed, certainly, in Chico's, the new jeans display that we did, where we try to go in and show all the different types of jeans and explain them better on the table. I think that we're much more aware how we present them in the stores. And perhaps we didn't do that as well as we should have in spring, but I think that we have made that correction for fall. But I don't really think we're over-assorted. I mean, obviously, the customer acceptance or unacceptance of the product is the biggest marketing research we have. I mean, if they don't buy it, we discontinue it. If they buy it, we buy more. So I think that what we have is working. Our bottoms business is very, very strong across all brands. Elizabeth O. Pierce - Ascendiant Capital Markets LLC, Research Division: And so do you think that the -- I mean, I would agree with you, I think it is that the signage has -- is perhaps maybe needs to be a little bit more focused in explaining some of the benefits because I have found associates that couldn't actually point out and didn't understand some of the product differences. David F. Dyer: Well, that is a problem, and it really is more of a training issue than an assortment issue. And I appreciate your comments on that. And I'm sure Cinny and I will be discussing that rather quickly.

Our next question will come from Marni Shapiro of The Retail Tracker. Marni Shapiro - The Retail Tracker: I just had 2 quick housekeeping questions for you, if you don't mind. Can you talk a little bit about UPTs? Because what I'm trying to understand is, you said conversion was very good. And I'm wondering if -- while she's not in frequently, if she didn't buy spring given the weather and is taking a breather before she starts during the summer -- during the second quarter, was taking a breather before she was ready to buy the next quarter, when she came in and purchased, was the UPT up as she was buying? Pamela K. Knous: The UPT was fairly consistent quarter-over-quarter. Marni Shapiro - The Retail Tracker: Okay. And then, if I think about the back half of the year and I look past the shift of timing of deliveries in the 53rd week, are you planning inventory to be up or down in the back half on a dollar unit basis? I just want to clarify that. Pamela K. Knous: At the third quarter, we clearly expect it to be up. As we said, it could be up a double-digit percent because of the timing of the receipts related to the holiday. David F. Dyer: We've gone from a long... Marni Shapiro - The Retail Tracker: Right. But if you take out the timing of receipts and you think about it on the store -- on a fleet-per-fleet basis for the brand, are you planning to have more inventory overall this fall and holiday or less inventory overall this fall and holiday than last year? Pamela K. Knous: We're planning to have the amount of inventory -- we're obviously going to have more because we've got a lot more stores. So you can't just look at the dollar amount. But on a square footage basis, our stores are actually more productive than they have been in the past. David F. Dyer: So on a dollar per square foot, no. I mean, we're very comfortable with it. I mean, the timing, we've gone from the longest distance between Thanksgiving and Christmas last year to the shortest this year. So really that 53rd week shift has caused us to have to do our inventory a little differently than we did last year. And again, the end of quarter inventories, just a flash at the moment in time and... Marni Shapiro - The Retail Tracker: That's why I'm trying to get to, if you're planning this holiday season. Given the shorter holiday season and given the trends in traffic, have you planned this holiday season, inventory-wise, more conservatively, if you take out all the timing shift? And I think about it on my store down the street this year for holiday versus my store down the street last year for holiday. Are you going to have less inventory? David F. Dyer: We're planning it in line with our sales forecast.

Our next question will come from Richard Jaffe of Stifel. Richard Ellis Jaffe - Stifel, Nicolaus & Co., Inc., Research Division: Just a follow-up on the outlet initiatives and how those stores are doing for each division compared to their full-line or regular-priced brethren and then the outlook for growth for that business and then the possibility of putting outlet online as well.

Well, first, in terms of outlets in general, we don't tend to break them out. But I would say what Dave said about overall traffic and comp sales across different mall types and geographies probably holds true for outlets as well. There's not a major shift in trend between the 2. I would say also, nothing that we're seeing right now in the outlet space is impacting any of our plans for growth there. We're continuing to increase made-for-outlet and White House and seeing good success. Pamela K. Knous: Outlets are a big part of new store square footage growth that we've got planned. As we've shared with you in the past, outlets is one of the few areas where there is new mall development occurring, and we are preferred tenants. So we are looking to go into those for our team. So I would say to you, we do look positively at the outlet business. As far as online, no decision has been made at this time regarding whether or not we'd be putting outlets online. David F. Dyer: Yes, that's kind of an interesting question. We have debated it internally, and right now, we don't really think that we should do that. We think it may undermine some of the other sales. And the outlets are there as an alternative channel and also to provide some relief from our regular stores when they have excess inventory. So I think for right now, we're just going to continue to do the online sale and clearance but not really put up the outlet assortment online for right now.

Our last question will come from Brian Tunick of JP Morgan. Brian J. Tunick - JP Morgan Chase & Co, Research Division: One longer term and one shorter term. On the long term, can you maybe remind us -- you've talked about growing earnings at a mid-teens rate over the longer term. Can you remind us what investments in Boston Proper, launch of Canada and the new DC, might be weighing on the 2013 either operating margin or earnings? And what can come back next year or 2? And then shorter term, I think, Dave, you said traffic is challenging quarter-to-date, White House | Black Market off the bull's eye on fashion, Pam reminding us that Q3 gross margin compares are tough. Just wondering, if you think about Q3 gross margin pressure, could it be similar to Q2's, 160-ish basis points or could there be any offsets in the quarter?

Yes. Brian, it's Todd. I'll start on the strategic initiatives. So we've said for our big 3 this year, which are Boston Proper stores, we're opening our first 4; we have our first 3 international stores with White House | Black Market in Canada; and then investments in omni-channel. The combination of those 3 should be around $5 million of expense and about $20 million in capital this year. Pamela K. Knous: Right. And as you think about next year, clearly, we have already talked about 15 to 20 Boston Proper stores for next year, and Chico's will have stores in Canada as well. David F. Dyer: And investment in the new POS system next year, which is, again, a capital expense. But that will then position us to do mobile technology to a greater extent in all of our stores as we roll that out. Pamela K. Knous: Right. And you were right, Brian. I did comment that quarter 3 is going to be a challenging quarter for us. We had very strong performance with that 10% comp and the strong margin that we had. And as Dave said, a lot is going to depend on how the promotional environment plays out. We think we've got really great product, and we're going to have things that she's going to want to buy. But we're going to have to compete in that marketplace, and we will see how that -- how the gross margin is going to stack up as we move through the quarter. David F. Dyer: Right.

All right. Thanks, Brian, and thanks, everyone. So that does conclude our call for this morning. I apologize to those questions that we did not get to today in the hour or so that we were on the call. As always, I'm available for any follow-ups necessary. Thank you, all, for joining us this morning, and we appreciate your continuing interest in Chico's FAS.

Ladies and gentlemen, the conference has now concluded. Thank you for attending today's presentation. You may now disconnect.