Katharine W. Kenny - Vice President of Investor Relations Thomas J. Folliard - Chief Executive Officer, President and Director Thomas W. Reedy - Chief Financial Officer and Executive Vice President

Brian W. Nagel - Oppenheimer & Co. Inc., Research Division Austin Pauls - RBC Capital Markets, LLC, Research Division Craig R. Kennison - Robert W. Baird & Co. Incorporated, Research Division Matthew R. Nemer - Wells Fargo Securities, LLC, Research Division Elizabeth Lane - BofA Merrill Lynch, Research Division Sharon Zackfia - William Blair & Company L.L.C., Research Division Simeon Gutman - Crédit Suisse AG, Research Division Dan Galves - Deutsche Bank AG, Research Division Matthew J. Fassler - Goldman Sachs Group Inc., Research Division Clint D. Fendley - Davenport & Company, LLC, Research Division William R. Armstrong - CL King & Associates, Inc. Unknown Analyst David Whiston - Morningstar Inc., Research Division

Good morning, my name is Bettina, and I will be your conference operator today. At this time, I would like to welcome everyone to the Quarter 4 Fiscal Year 2012 Conference Call. [Operator Instructions] Ms. Kenny, you may begin your conference. Katharine W. Kenny: Good morning. Thank you for joining our Fiscal 2012 Fourth Quarter Earnings Conference Call today. On the call with me today are Tom Folliard, our President and Chief Executive Officer; and Tom Reedy, our Executive Vice President and CFO. Before we begin, let me remind you that our statements today regarding the company's future business plans, prospects and financial performance are forward-looking statements that we make pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current knowledge and assumptions about future events that involve risks and uncertainties that could cause actual events -- actual results to differ materially from our expectations. In providing projections and other forward-looking statements, the company disclaims any intent or obligation to update them. For additional information on important factors that could affect these expectations, please see the company's annual report on Form 10-K for the fiscal year ended February 28, 2011, filed with the SEC. Tom? Thomas J. Folliard: Thank you, Katharine. Good morning, everyone. Thanks for joining us today. While we are pleased to report another year of record revenues and earnings, we achieved some major milestones this year, including total revenue of over $10 billion for the first time and retail used vehicle sales of over 400,000. Some other highlights for the year include used unit comps increased by 1% compared to a very challenging 10% in the prior year. Net earnings, up 10% to $414 million. Wholesale unit sales increased by 20% to over 300,000 and total wholesale gross profit grew by 26%. CAF income, up 19%. And we ended our managed receivables at nearly $5 billion. We also estimate we increased our market share of late-model used vehicle sales by approximately 3%. Highlights for the fourth quarter. Used unit comps increased by 4% compared to 12% in the previous year. Total used gross profit grew by 8%, and total wholesale gross profit grew by 20%. Wholesale unit sales, up 13% due to strong appraisal traffic. Our appraisal buy rate was similar to the last several quarters and last year's fourth quarter at a little over 29%. CAF quarterly income was also a strong contributor growing by 22% to $66.1 million. During the quarter, sales of 5-year and older vehicles as a percentage of our total, were over 25% similar to what we reported in the third quarter. Sales of SUVs and trucks remained about the same as a percentage of our total last year, but fell from 31% to less than 21% -- less than 27% of our sales sequentially. As we've discussed before, our mix of vehicles would vary depending on the needs of our customers. And I'll turn over to Tom Reedy. Tom? Thomas W. Reedy: Good morning, everyone. As Tom mentioned, CAF had a strong quarter with income up $12 million or 22% compared to the fourth quarter fiscal 2011. Our portfolio grew 14% to nearly $5 billion. And net loans originated increased 36% compared with the fourth quarter fiscal 2011. While the increase in unit sales and average selling price contributed to the portfolio growth, it was largely driven by the key motive impact of our decision to retain more of the loans we had historically approved, but in recent years had been purchased by third-party providers. As of January this year, we have transitioned back to retaining all of these loans. CAF penetration for the quarter was approximately 37%, up from 29% last year. Interest margin as a percent of average receivables increased to 7.3% compared to last year of 6.9%. While we have increased our retention of higher risk loans with higher APRs, we've also been providing more aggressive offers to attract and retain higher FICO customers. So while interest and fee income grew about $10 million year-over-year, it was down modestly as a percent of average receivables from 9.7% to 9.4%. Interest expense has continued to decline as higher cost securitizations paid down and yields of lower interest expense continued to become a greater portion of our financing. As you may have seen, we closed the first 2012 ABS deal in mid-February. At this point, the market for auto paper seems to be quite healthy as we saw a strong demand for the deal and were able to upsize the transaction to $970 million. Our provision for losses grew by $2.2 million year-over-year. That's the product of favorable loss experience dampening the impact of retaining more loans with greater credit risk in the growth in our receivables. Access to financing for our customers continues to be very strong with 85% of applications receiving an approval. While the fourth quarters always are high for subprime mix, subprime penetration grew to 15% of sales in the quarter, that's versus 9% in the fourth quarter last year. Some of this may be due to strong tax season and mix through the door, but we have clearly seen our partner with continued experience and comfort in the CarMax origination channel begin to provide more attractive offers to our customers. Additionally, we believe we've improved our in-store execution around subprime sales and applications. Before I turn the call back over to Tom, let me touch on the correction and lease accounting. During the quarter, we determined, along with our auditors, that we should utilize the financing method of accounting for sale-leaseback transactions. As a result, we made revisions to our financial statements to correct the accounting for transactions entered into between fiscal 1995 and 2009. In simplest terms, certain assets that we were treating as rented are now treated as owned and financed. The net effect is the assets are added to our balance sheet and the financing liability is created. Depreciation has increased with those new assets, and rent expense and G&A is reduced. And payment on the sale-leaseback transactions are now recognized as interest and a decrease in the financing liability. We've determined that these revisions do not materially affect our financial statements. They generally impact our income statements by approximately the same amount, $0.02 a share, each year including fiscal 2012. However, our total earnings growth is not affected. For your reference, we have included revised quarterly income statements for the past 2 years in our press release. Tom? Thomas J. Folliard: Thank you, Tom. As I mentioned, we estimated that we grew market share this year in the 0- to 6-year old vehicle market by approximately 3%. Given the strength and unique quality of our consumer offer, we're confident we'll continue to expand our market share, especially as we continue to grow our store base and as late-model vehicles begin to increase again as a percentage of the overall used vehicle inventory. Also remember that currently about 15% of our sales are vehicles that are outside of 1 to 6 years old older than 6. We're also very excited about our store opening plans over the next several years. As you know, during the fourth quarter, we opened our fifth store for fiscal 2012 in Chattanooga, Tennessee. In today's press release, we included the complete list of our currently projected store openings for fiscal 2013, including our expected opening of a second store opening in Jacksonville, Florida in the fourth quarter. All right, at this time, we're happy to take your questions.

[Operator Instructions] Your first question comes from the line of Brian Nagel with Oppenheimer. Brian W. Nagel - Oppenheimer & Co. Inc., Research Division: So first question, Tom, more of a qualitative one -- but we're looking at the sales trend, the used unit comps, and you're clear that, that metric continued to improve here in the fourth quarter with the 4%. I assume it got -- the numbers got better through the quarter. But the question I have for you is -- and we talk a lot about this on prior calls and other conversations, but how would you characterize your overall tone of your customer -- the overall tone of your customer? Now you've seen -- I've seen a larger number of customer, better traffic, better conversion, and how is that basically playing out? Thomas J. Folliard: Well, we -- in the quarter, our traffic was up. And I think we talked about this some on the last call that because of our really high volume of appraisals recently and particularly appraisal-only customers, over the last couple of years, we've kind of gone back and looked at our conversion and tried to segment out customers who are really and specifically just coming to buy a car from us. And when we do that, we're really comfortable and confident that our conversion continues to increase, and that we did once again in the quarter and it also went up some for the year. Our traffic was up about 6% in the quarter, but that includes -- that's total traffic, which also includes appraisal traffic. So I think the customer flow that we're getting is solid; good, quality customer flow that wants to buy cars and we're converting them at a pretty good clip. We still would like to see a higher flow of customers overall, but we're pretty pleased with how the quarter came out. Brian W. Nagel - Oppenheimer & Co. Inc., Research Division: So I guess just to follow up on that. If we look at how the customer tracked through the fourth quarter, I mean, where there significant differences between, let's say, Q4 and then Q3, Q2 for you guys? How should we think about the change of dynamics in the customer? Thomas J. Folliard: Well, we don't talk about any movement during the quarter. The last 2 quarters were a little disappointing from a sales and customer flow standpoint with -- I think we were a negative 2 and negative 3 on comps in the second and third quarters. So clearly, this was a better quarter with a plus 4, and I'd say that's the biggest difference. We were down the last 2 quarters, we're up this 1. Brian W. Nagel - Oppenheimer & Co. Inc., Research Division: Okay, fair enough. And the second question I have on SG&A spend. We talked -- you guys are clearly ramping up growth again. We saw a higher SG&A spend in the fourth quarter related to that growth. How should we think about SG&A spend as we look into 2012 related to your unit -- more aggressive unit expansion? Thomas J. Folliard: Well, we're going to have some more expenses around store growth because we're either opening or preparing to open more stores in this year than we did last year. And we talked about coming out of the recession having a kind of a controlled build of store growth. We opened up 3 stores 2 years ago, 5 stores last year. We said we're going to open 10 this year and 10 to 15 in the next. So there are some spend that goes along with that on pre-opening expense, on staffing up to be prepared to open up those stores, relocation, all those kind of things. So we expect SG&A to go up and hopefully, we can get some comp sales to offset it. Brian W. Nagel - Oppenheimer & Co. Inc., Research Division: So was there any -- do you mind giving parameters of how much higher SG&A spending should be in 2012? Thomas J. Folliard: We're not going to give any guidance on that. We did provide -- we are providing a table for SG&A. Where did we put that? Katharine W. Kenny: In the K. Thomas J. Folliard: It will be in the K and we break it down a little better in there, so that will be new.

Your next question comes from the line of Scot Ciccarelli. Austin Pauls - RBC Capital Markets, LLC, Research Division: This is actually Austin on for Scott today. Question just to follow up on the previous question on SG&A. I understand that the expenses will be ramping up as you ramp up store growth. But I did notice in the press release, you talked about lower advertising expense, which, I guess, seems a little bit counterintuitive. I would think that you would ramp that up as you grow stores and grow into new markets. So could you maybe talk about advertising and how you expect that to trend in the coming year? Thomas J. Folliard: Yes. I think that for the quarter, that was just -- we did not -- we didn't do Super Bowl this year and we did last year. That's a pretty, pretty overpriced thing to do. Austin Pauls - RBC Capital Markets, LLC, Research Division: Okay, fair enough. So that was just for this quarter. But I guess in the coming year, should we expect advertising to ramp up along with the other expenses related to new store growth? Thomas J. Folliard: Yes. We try to think about advertising on a per unit sold basis. If we get the sales we expect, we would expect to spend more money on advertising. And then we're going to have some pre-opening advertising that will be larger than it was last year because we'll open more stores. Austin Pauls - RBC Capital Markets, LLC, Research Division: Okay, understood. And then just one last question on a different topic. Obviously, we've all seen gas prices rising in recent months. I'm curious, is that impacting your mix at all? Are people looking for smaller and more [indiscernible]? And I guess I'm kind of thinking about that in the context of ASPs, but were still up with, I think, 4% year-over-year. So just curious how the mix is trending and how that will impact ASPs going forward. Thomas J. Folliard: Yes. We talked about -- I mentioned that in the -- in my opening remarks. Our SUV mix was down 4 points sequentially year-over-year. But it's not -- it's in the sub -- I mean, I'm sorry, midsize and small cars were up about the same to offset that. So we have seen it, but just from a how does it feel, it doesn't feel anything like it did back in May of '08 when gas hit $4, and we saw a dramatic shift in consumer behavior. I'd say this has been a little bit more gradual, and people seem a little more settled into the high $3s on gas prices. But I think one of the best things about the CarMax consumer offer is we're pretty nimble, and we can adjust our inventory to whatever the consumer is looking to buy. And it doesn't make any difference to us. We're happy to sell smaller cars. We're happy to sell SUVs. And as we've talked about before, our margin is more on a per unit basis, and it's not really driven off of ASP. The only place where ASP really has an impact is on average amount financed in CAF. So -- and I also think that ASPs over the last couple of years have been driven far more by the changes in the wholesale market than they have been by anything to do with our mix.

Your next question comes from the line of Craig Kennison with Robert W. Baird. Craig R. Kennison - Robert W. Baird & Co. Incorporated, Research Division: Market share. I want to thank you for the additional detail you shared with us. Could you help us clarify more detail on that in terms of the overall size of the 0- to 6-year-old market? Thomas J. Folliard: Yes. The overall size -- the 0- to 6-year-old market shrunk again during the year. A few points to remember about the way we report market share: One, we only report market share in the market that we're in. We're only in half of the U.S. markets. We're talking about our share of 1- to 6-year-old cars. We do it on an annual basis because the data that we buy and we get -- although it's been very consistent for a long period of time, it's actually very inconsistent if you look at it over shorter periods of time. We feel pretty comfortable reporting it annually. And we feel very comfortable that we grew our share of 1- to 6-year-old cars. And then remember that 15% of our retail sales are older than 6 years old, so they're not even included in the number. And that makes it a little bit challenging. But if we said well, we sell all the way out to 10-year-old cars, so let's look at our share of 1- to 10-year-old cars. That chunk of the market is so big that if we said our retail share that will drop down to just a miniscule number. So that's the reason we keep reporting on the consistent basis. Additionally, we sell very high quality cars at retail, and we wholesale stuff that is older. So you've seen our wholesale business grow pretty dramatically over the years. When you look at those 2 numbers combined, we sold over 300,000 wholesale cars during the year. Lots of those cars are in that older segment, the 6- to 10-year old. So we try to look at our total business. We run our business a little different than some of the other retailers. Most others don't have such a big wholesale business. So we kind of look at our participation in -- in the total used car market, we sold 400,000 retail cars. We also sold 300,000 wholesale cars. And we really like our positioning there. But we're going to keep reporting share the way we do. We think it's important. We think it's an important measure for our business. But again, there's a lot of caveats there because of the lack of data that's available. Craig R. Kennison - Robert W. Baird & Co. Incorporated, Research Division: And the 3% to which you refer, is that a percentage point gain in share of the market you're addressing? Thomas J. Folliard: That's 3%, not 3 percentage points. So it's 3%. It's a small change. And again, it's of 1- to 6-year-old cars, remembering that 15% of our sales are not even in that segment. And we still grew share and a couple of other pieces I didn't mention. As our store base ages, we have slower growth in our bigger older stores as you would imagine. We're now starting to put newer stores back into the base, which should help. We'll also be adding stores into existing markets, which help share -- doesn't necessarily help comps right away but helps share. So you have those factors as well. And then historically, we have -- our performance has been stronger in 1- to 3-year old than it has been in, say, 4 to 6. And 1- to 3-year old has shrunk even more than 1 to 6 because of the lack of new car sales. So when that starts to come back and we've seen the SAAR start to come back some, then that 1- to 6-year-old share number also should benefit a little bit from that. Craig R. Kennison - Robert W. Baird & Co. Incorporated, Research Division: That was my last question. When do you think we'll see the bottom in your addressable market as SAAR picks up? Is that a 2014 bottom? Thomas J. Folliard: We have no idea. Hopefully, we already saw it. But it's hard to judge. But -- and if you look at the supply chain and you look at what's been sold over the last couple of years, we're still a year or 2 away from seeing the supply come back in 1- to 3-year-old cars. And it's one of the things I'm really proud of that we've been able to do is move our business model around with the changing conditions in the marketplace. And our business is really a diversified profit model between retail and wholesale and finance, and I think we take advantage of whatever is available to us at the time.

Your next question comes from the line of Matt Nemer with Wells Fargo Securities. Matthew R. Nemer - Wells Fargo Securities, LLC, Research Division: Just to follow up on market share. The 3% change in share was a little bit lower than it has been in previous years. And I'm wondering, was that pretty consistent through the year, or do you think that there's a point in time where maybe you went negative or you were lower than 3%? And if so, what do you attribute that to? Thomas J. Folliard: Well, one, Matt, you've been asking questions long enough to know we don't talk about trends during the year. It was 3% up for the year. All the reasons I just mentioned, I think, are contributing factors to a share gain that isn't as strong as the last 2 years. Last year, I think it was around 7 and the year before, we were in the double digits. But I'm pretty happy with our share growing every year. I'll take share gains every year. Matthew R. Nemer - Wells Fargo Securities, LLC, Research Division: Understood. And then just in terms of subprime increase and subprime. How much of that do you think was incremental and helped the comp this quarter? Or is there a way to kind of think about the impact that it may have had on used unit comps? Thomas W. Reedy: It came as comp, Tom. I think a great amount of it was incremental. If you see the step-up, it was 9% last year, 15% this year. As I've mentioned, we did see credit quality through the door down but our partners, because they've gotten more experienced with the origination channel and how their portfolio has performed, have been delivering offers to our customers. They are offers that the customers are more likely to accept, and mainly that means better down payments. So we've seen a definite step-up in that, and it was impactful for the quarter. Matthew R. Nemer - Wells Fargo Securities, LLC, Research Division: Okay. And then just lastly, I know that you don't give guidance and you'll probably say that again. But as you look at 2013, is it possible that wholesale units will be down? How are you thinking about wholesale given sort of the strange comparisons? And then, do you have any feeling for whether we'll see net gains in -- from a reconditioning standpoint? Thomas J. Folliard: Well, the first part, you were absolutely right about, which is we don't give guidance. What I will say about wholesale is, wholesale is driven by appraisals and appraisal buy rate, and the number of cars we get through the lane that don't meet our retail standards. We do expect that if SAAR grows, that our appraisal lane traffic will grow. It's not exactly correlated, and I couldn't tell you what that's going to be. But if we saw a big movement in SAAR during the year, we would expect to do more appraisals. That would benefit us on the wholesale side. It would benefit us on the retail side because we'd buy more of those cars as well. Our buy rate can move with how the wholesale market moves, whether it's an appreciating market or depreciating market. We've been able to manage pretty well throughout. But there's no question that in an appreciating market, buy rate is helped. So there's just a lot of variable there that will yield whatever wholesale will yield this year, which is why we don't give any guidance on it. But I would say, as SAAR moves, we would expect appraisals to move. And what was the second part? Matthew R. Nemer - Wells Fargo Securities, LLC, Research Division: Just recon, your reconditioning savings expectations for this year. Thomas J. Folliard: Yes. So we feel really good about the 250 that we've gotten so far, and that is sustainable. I've said all along that if there was any left, it was going to be the more difficult part to get. I think we originally talked about 300, and we've said the last 50 would be a lot harder than the first 250. I mean, it's really tough to say what will happen during the year and whether or not we'll get it. But that's about all I can say there. We're really pleased with the progress that we've made so far. One benefit that we've had over the last couple of years that we're now not having is we really didn't see a lot of inflation in parts and things like that a couple of years ago. And over the last year, we started to see inflation a little bit more, so we got to think about inflation adjusting, how we talk about reconditioning cost. But that's just been something -- clearly, we don't expect it to be true going forward that we really don't see any inflation in cost.

Your next question comes from the line of John Murphy from Bank of America Merrill Lynch. Elizabeth Lane - BofA Merrill Lynch, Research Division: This is Elizabeth Lane on for John. What kind of inventory levels do you guys currently have in stores compared to what your ideal levels would be? And do you have a projection for U.S. new vehicle sales this year and how that increase in trade activity could help inventory? Thomas J. Folliard: So one, we don't have a projection. We've always felt really good about our ability to react and adjust to whatever happens. That wouldn't -- our view is that if SAAR went up a bunch, that traffic would benefit and potentially, sales would benefit, and we would move our inventory accordingly. So it's not like because SAAR goes up that, that's going to change our inventory level. We'll move our inventory along with sales. Inventory year-over-year was roughly flat, probably up just for the new store difference. Our inventory turns for the quarter were a little over 8 compared to 7.5 last year. So turns were -- in the quarter, so turns were up.

Your next question comes from the line of Sharon Zackfia with William Blair. Sharon Zackfia - William Blair & Company L.L.C., Research Division: A few questions. I guess, I know it's still relatively early but it appears that the new stores that you opened last year got off to a relatively good start. So just wondering how you feel about the new store productivity and whether there's any predictability there yet. And with price elasticity of demand, I know there's something you and I have talked about quite a bit over the over past few years. Are you seeing any indication of price elasticity of demand coming back with the consumer? Thomas J. Folliard: So on the first one, it's still a little early for new stores. If you -- we opened up Cincinnati, Dayton and Augusta, which would now be in the comp store base. And then the 5 we opened last year, none of those will be comp stores. And it's still a little early to talk about that. I think over the next couple of quarters, we'll start reporting on -- we'll start thinking about reporting on new store performance as a group. And then the last question was? Thomas W. Reedy: Elasticity. Thomas J. Folliard: Elasticity. Yes, it's still not like it was before. And as you know, we're constantly adjusting and moving our prices and our margins to try to capture what we think is the optimal amount of both sales and margin. But in terms of moving price down a couple of hundred bucks and seeing it -- getting it all back in sales, we still don't see it. Sharon Zackfia - William Blair & Company L.L.C., Research Division: Okay. Just one follow-up question. I guess on CarMax Auto Finance, I know you don't give guidance specifically for it. But would it be reasonable to expect the contribution from CarMax Auto Finance to grow a little bit less quickly this year than last year? Thomas W. Reedy: Sharon, I don't think that's an unreasonable assumption. As we mentioned, during the course of fiscal 2012, we were taking back volume that we used to be selling off to our partners, which means our penetration was increasing during the year. And as I mentioned, we are back to the full spectrum of what we bought historically. So as far as opportunity, you take additional sales and support them with CAF without doing something different. From a credit perspective, we pretty much moved to where we were historically. Thomas J. Folliard: And then, remember too, Sharon, it's not like the old accounting where if we got an 8% or 10% comp during any given year in the past, because of the way accounting worked, CAF would kind of grow along with it. And now that's going to get dampened because of the -- because of how you recognize earnings. Thomas W. Reedy: Sharon, one other thing, if you remember at the beginning of the year, we mentioned that we had significant favorability and losses, and we saw some of that this quarter as well. So obviously, we have baked into our loss provision everything we think we're going to see over the next 12 months from a loss perspective. So one thing to keep in mind is FY '12 was helped by a favorability in losses. And obviously, we're not projecting that or it would be into our reserve.

Your next question comes from the line of Simeon Gutman with the Credit Suisse. Simeon Gutman - Crédit Suisse AG, Research Division: Tom, have you given any thought to maybe selling an older mix of cars at retail? And I guess to your point earlier, if you combine the retail and the wholesale business, you're probably taking share in all classes of older ages of vehicles? Thomas J. Folliard: Yes, I talked about this last quarter and I mentioned in the script, our percentage of inventory that we retail that was between 5 and 10 years old. Now I'm going to go back to June of last year, roughly, our percentage of inventory was about 15% of what we retailed was between 5 and 10 years old. And then at the end of the third quarter, that number was up closer to 30%, north of 25%. So clearly, in a short period of time, about 6 months, we responded to consumer demand, and we shifted our inventory to that older mix. The reason it gets a little confusing is because we report 1 to 6. I just gave you 5 to 10, so that includes 5 and 6. And then in this last quarter, the one that just ended, that mix of sales was similar. So if you said what's your mix of 5- to 10-year-old sales this year compared to last year, it's up pretty significantly. So we absolutely have shifted towards older stuff, and because that's what the consumer is looking for. Simeon Gutman - Crédit Suisse AG, Research Division: Got it. Okay. And I know it's early days, can you just give any initial thoughts on Chattanooga because I know it's a slightly different format on a couple of respects? I'm curious what the -- some initial takeaways may be. Thomas J. Folliard: Well, it's a really good-looking store. We have a bunch of technology in there that we're excited about, and it's all working. So that's a plus. And it was a pretty enthusiastic store opening because of all the kind of exciting uses of technology and social media and some of the other stuff that we're using in the store. But in terms of result, it's just way too early to even talk about. Simeon Gutman - Crédit Suisse AG, Research Division: What about anything on the labor model there or in smaller market stores that you can apply to either other stores now or other bigger stores? Thomas J. Folliard: Yes, we didn't really -- there's nothing there especially not this early. One thing to remember is this is -- it's an evolutionary change for us. It's a product of 18 years of history and adjusting our model accordingly. But we didn't reinvent the consumer offer in that store. We changed somewhat the way we deliver it. But we're still doing the same high-quality cars. We're still doing the 30-day warranty. We're still doing the 5-day money-back guarantee, still paying flat commissions to all of our sales people, so that our incentives are lined up in the consumers' best interest. We're still making a cash offer on every car. We're trying to do a better job delivering on the store. But the basics of the CarMax customer offer are all still there. And a lot of the components that we have designed into the store are pre-modular, and we can roll them back into the existing stores if we see them working. But again, it's just -- it's awfully early to be talking about sales in one store. Simeon Gutman - Crédit Suisse AG, Research Division: Okay. And then second or third on CAF. Is it fair to assume that the loss rate ticked up because you're expanding the mix, or the mix of subprime is going up or there are some offsets? And then any update -- I think there was talk about potentially adding another subprime partner to the mix? Thomas J. Folliard: Well, the mix of subprime has nothing to do with CAF loss rate because those are done by a different lender. Thomas W. Reedy: Yes, and we're texting other partners in both the Tier 2 space and the subprime space. And as soon as we have one that's enough of a critical mass, we'll talk about it. Thomas J. Folliard: And the change in loss rate in total was absolutely just the change in the mix and taking back the stuff that we were doing -- that we used to do and didn't do and now do again.

Your next question comes from the line of Rod Lache with Deutsche Bank. Dan Galves - Deutsche Bank AG, Research Division: It's Dan Galves in for Rod this morning. Just I have a question on CAF. Versus Q3, it looked like the kind of the net interest margin as a percent of managed receivables declined a little bit, and the loan loss provision also declined somewhat. We have expected loan losses to kind of stay similar to Q3 on kind of your broader credit spectrum. Wondering if you could provide any color on kind of trends in those 2, what do you expect in trends in those 2 margin numbers going forward? Thomas W. Reedy: Yes, I can't give any visibility on what we expect in trends. But as far as during the quarter, we did see some favorability in our loan loss experience. Our wholesale recovery rate is still high, around 60% like it's been going. But what we've seen this quarter is a higher frequency of people paying to get current. It wasn't enough to be material about the number, but we did see some favorability in the quarter on losses. And as far as the APR. As I mentioned, in addition to taking back the higher risk and higher APR paper, we've also been pricing more aggressively with our higher FICO customers, so there's some offset there on the -- from the top line. Dan Galves - Deutsche Bank AG, Research Division: Okay, got you. And then, on SG&A per unit, I mean, is there any kind of rule of thumb we should be looking at in terms of what level of comps, same-store comps you need for that SG&A per unit number to stay flat or not go up? Thomas J. Folliard: Yes. I think we've historically set it. It's in the kind of mid-single digits, which -- and it's probably in the current environment since we're adding incremental stores vis-à-vis last year Remington. This year versus 5 last year, I'd look to the higher end of that kind of range. Dan Galves - Deutsche Bank AG, Research Division: Okay, got you. And then one other one, in terms of more later-model vehicles, obviously used prices are pretty strong right now. Also we're seeing like a lot better fuel economy and connectivity and technology and some of the new vehicles that have come out in the last year. What are you seeing? Has there been any change in how people are evaluating a purchase of a late-model used car versus a late-model new car? Kind of what are you seeing when people are making that decision and any changes recently? Thomas J. Folliard: Well, I don't know that any of that stuff has had an impact as much as just the economy and people's unwillingness to get involved in a loan or higher priced car. I think that's why we've seen the 0- to 6-year-old market decline for a few years in a row now. And new car sales, although they're up and everybody's happy about it, they're nowhere near where they used to be. It's 15, the SAAR was 15 in February. It was a little over 14 in March. We went 8, 9 years in a row with that number around $17 million. So I still think the customer is sitting back and waiting a little bit. I still don't think it’s back to where it was before. Despite all the things that you talked about with technology and changes in new cars that I think are all positive, the consumer is still not all the way back. Dan Galves - Deutsche Bank AG, Research Division: Okay, got you. And one housekeeping, can you tell us what percentage of your retail sales came out of the appraisal lanes this quarter? Thomas J. Folliard: That was a little over 50%. Dan Galves - Deutsche Bank AG, Research Division: Is that about flat from last quarter? Thomas J. Folliard: I think it was -- I think so. We'll get that for you. Katharine W. Kenny: It was a little bit down from the last quarter, I think.

Your next question comes from the line of Matthew Fassler with Goldman Sachs. Matthew J. Fassler - Goldman Sachs Group Inc., Research Division: Just a couple of quick follow-ups here. First of all, if you could sort of talk about the puts and takes on used vehicle gross profit per car in the current environment. You addressed reconditioning briefly, were any other moving pieces that you think are influencing that number? Thomas J. Folliard: No, not really. It was relatively flat compared to last year. Our turns are up a little bit. That always helps but nothing really unusual on the quarter. Matthew J. Fassler - Goldman Sachs Group Inc., Research Division: Got it. And then, secondly, can you talk about the distribution of outcomes among your markets? And I know you don't give market-by-market performance. But are you seeing the differences between markets get bigger, smaller, what things that refer from a number of retailers, is that as the environment has improved to some degree that dispersion has moderated somewhat? Are you seeing that in your numbers? Thomas J. Folliard: Yes, we haven't talk about that historically, Matt.

Your next question comes from the line of Clint Fendley with Davenport. Clint D. Fendley - Davenport & Company, LLC, Research Division: I know there were several adjustments related to the sale-leaseback for the year. I just wondered, should the depreciation run rate for fiscal '13 be similar to what we've seen in the fourth quarter? Thomas W. Reedy: I think when you look at the adjusted numbers, you can get a good picture for that. It's in the cash book. Clint D. Fendley - Davenport & Company, LLC, Research Division: Okay. And so we should we expect the similar rate for the coming year then. Thomas W. Reedy: Well, obviously, we're going to be adding new stores, which have probably planned equipment to get appreciated. But as far as the adjustment, it should be... Clint D. Fendley - Davenport & Company, LLC, Research Division: We're done with the adjustment. Thomas W. Reedy: Absolutely, absolutely. Clint D. Fendley - Davenport & Company, LLC, Research Division: And switching gears for a second. And I know we've had several questions on market share growth. But I just wondered, is it reasonable to expect for you guys to get back to the previous growth rates now that you've resumed your store growth? And just kind of wondering, I mean, how much of the SAAR rate here is due to the tighter or tougher consumer environment versus your sort of lack of opening any stores for the last several years? Thomas J. Folliard: It's hard to really quantify that's why I think the number of factors that I talked about earlier as it relates to market share. And we're hopeful that the games go back up, but it's nice to be explaining gains, so.

Your next question comes from the line of Bill Armstrong with CL King and Associates. William R. Armstrong - CL King & Associates, Inc.: I was wondering if you could discuss current trends in the spread between new car prices and late-model used car prices. Are you seeing that widening at all? And if so, does that start to make your offerings a little more attractive to consumers? Thomas J. Folliard: We haven't looked at that in a while. That's a good question. But the spreads, as our average retail has gone up since kind of the depth of the recession, our average retail went up $2,500 to $3,000. Over that same time period, we saw new cars, average new car price go up about $4,000. So probably it would have widened the spread a little bit more recently here. I actually don't -- I don't know the answer, but we haven't seen a move enough that we thought we should talk about it. William R. Armstrong - CL King & Associates, Inc.: Understood. And on capital expenditures, you're budgeting about $280 million, that's a big increase from last year. I assume most of that is new stores. Are there any other major projects that are incorporated into that number? Thomas W. Reedy: No, I think you're right that the lion's share of that is new stores and new land, et cetera, for future development. If you look back to what we were talking about in 2006, 2007, it's not out of line with the amount of spend we were projecting and spending at that point. There's always a certain amount of maintenance CapEx but for the most part, the increase is new stores.

[Operator Instructions] Your next question comes from the line of Justin Ellstein with Stephens Inc.

A number of my questions have already been answered but maybe just a couple of cleanups here. First question, just curious how much of that extra day in February helped the comp? Thomas J. Folliard: Probably roughly 190th.

Yes, okay. On the receivables balance, now that we're -- you've kind of caught up to the point where you are retaining all the lower quality credits. Thomas J. Folliard: Below high quality. Yes, remember.

I mean, just how quickly do you think you can grow that receivable balance going forward? Thomas J. Folliard: Well, we -- go ahead, Tom. Thomas W. Reedy: I was going to say, that is -- there is a -- there's a number of things that are going to drive that. And all else equal, the interest margin stays the same. Over time, you would see that portfolio grow similar with sales and which makes sense. But in a period of escalating growth, it might lag a bit because remember, we recognize the profit on these transactions over the life of the loan, not upfront. It's a portfolio. And our penetration average selling prices interest margin, those things all impact income. But all else equal, over the long term, it should go with the business unless we change our approach.

Sure. And can you just tell us what the total delinquencies were at the end of this quarter? Thomas W. Reedy: I want to get back to [indiscernible] and we'll get to that back up.

Okay, I'll just go into the next question. Given supply constraints still likely for this year, what kind of pricing benefit are you anticipating that we could see? Thomas J. Folliard: I'm not sure we see a pricing benefit in supply constraint. That generally in the past has led to higher prices. But we don't know what's going to happen with SAAR and the supply chain. I'm not really sure what your question was.

Well, with limited supply in units, I mean, are you anticipating any benefit in pricing? Do you think you can raise prices again this year? Thomas J. Folliard: No. I'm not sure. We manage it on a pretty short window of time. We're managing our inventory and pricing pretty much every day. So we're going to do whatever the market allows us to do.

And I'm showing no further questions at this time. You do have -- I apologize, you do have a question from David Whiston from Morningstar. David Whiston - Morningstar Inc., Research Division: I'm sorry if I missed this at the beginning, but did you give the appraisal buy rate yet? Thomas J. Folliard: Yes, it was a little over 29%. David Whiston - Morningstar Inc., Research Division: 29%. And to each of the Toms -- in your investor presentations, you used to have what you call your iceberg slide where you laid out your 5 components of sustainable competitive advantage. And in your opinion -- for each of your opinions, I'd just like to hear what do you think is the single most important contributor to that business model? Thomas J. Folliard: Well, in my opinion, I don't think there is a single one. I think it's a combination of all of the factors together that differentiate us from the competition. And I think one of the reasons we showed the iceberg like we did is to just give a visual understanding of how complex the behind-the-scenes stuff is in this business to do and do well. And I think that we're continuing to learn every year, and we're continuing to make strides every year in those areas. But the whole idea behind that slide was that what you see, what the consumer sees, what the competitors see, what investors see from the look and feel of the building, from walking in, from shopping in our store is only a small piece of actually delivering the consumer offer. So to me, there is no one thing. Thomas W. Reedy: Yes, I guess I would echo that. But I would add that over time, I think the competitive advantage that Tom mentioned is we've evolved into 3 real strong businesses that are complementary and deliver. We've got the retail business with all of the add-ons that go with that, the wholesale business and a very strong finance business. And the iceberg really doesn't capture that. It's more our competitive advantage from an operating perspective. But I think, that's the key that over time we've grown into a pretty diversified set of revenue streams. Thomas J. Folliard: That's a really good point. If we redid our iceberg, we have to put wholesale and CarMax Auto Finance under the waterline and make the bottom bigger. David Whiston - Morningstar Inc., Research Division: Yes, I agree. You guys just kill your competitors in wholesale. I mean, how long can you keep those margins up? Thomas J. Folliard: I think we don't look at it as what we're doing against the competition. It's a business segment for us that has customers. And we market to those customers. We provide great customer service. Our dealers are loyal, they're consistent. We have -- I think we have the highest dealer attendance ratios in all of the -- in auctioning. We're now the third largest auction chain in the United States. Again, we have really consistent attendance. We have phenomenal ratios. And we're pretty upfront with those customers. They know what they're buying from us. We stand but for the most part, stand behind what we sell. We make announcements on the condition of those cars, and I think it's allowed our business to continue to grow. We just -- we run that business as a separate business, and we run it differently than what the competition does so...

And I'm showing no further questions at this time. Thomas J. Folliard: All right. Thank you again for joining us. And as we close the year and start a new one, I just want to once again thank all of our associates for all your hard work, all your dedication. And I'd also like to express our thanks for the support and confidence of our customers and our investors. We'll talk to you again next quarter. Thanks.

And this does conclude today's conference call. You may now all disconnect.