Matt Schroeder - Group Vice President of Strategy & Investor Relations and Treasurer John T. Standley - Chief Executive Officer, President, Director and Member of Executive Committee Frank G. Vitrano - Chief Administrative Officer, Chief Financial Officer and Senior Executive Vice President

Steven Forbes - Guggenheim Securities, LLC, Research Division Carla Casella - JP Morgan Chase & Co, Research Division Karru Martinson - Deutsche Bank AG, Research Division Karen Eltrich - Goldman Sachs Group Inc., Research Division Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division Matthew J. Fassler - Goldman Sachs Group Inc., Research Division Lisa C. Gill - JP Morgan Chase & Co, Research Division Mary Ross Gilbert - Imperial Capital, LLC, Research Division Edward J. Kelly - Crédit Suisse AG, Research Division

Good morning. My name is Tabitha, and I'll be your conference operator today. At this time, I'd like welcome everyone to the Rite Aid Fourth Quarter Fiscal 2012 Conference Call. [Operator Instructions] Mr. Schroeder, you may begin your conference.

Thank you, Tabitha, and good morning, everyone. We welcome you to our Fourth Quarter Conference Call. On the call with me are John Standley, our President and Chief Executive Officer; and Frank Vitrano, our Chief Financial and Chief Administrative Officer. On today's call, John will give an overview of our fourth quarter results and discuss our business. Frank will discuss the key financial highlights and fiscal 2013 outlook. And then, we will take questions. As we mentioned today in our release, we are providing slides related to the material we will be discussing today, including annual earnings and sales guidance on our website, www.riteaid.com, under the Investor Relations Information tab for conference calls. This guidance is a point-in-time estimate made early in the fiscal year. The company expressly disclaims any current intention to update it. This conference call and the related slides will be available on the company's website until the next earnings call unless the company withdraws them earlier, and should not be relied upon thereafter. We will not be referring to the slides directly in our remarks but hope you will find them helpful as they summarize some of the key points made on the call. Before we start, I'd like to remind you that today's conference call includes certain forward-looking statements. These forward-looking statements are made in the context of certain risks and uncertainties that can or cause actual results to differ. These risks and uncertainties are described in our press release, in Item 1A of our most recent annual report on Form 10-K and other documents we file or furnish to the Securities and Exchange Commission. Also, we will be using a non-GAAP financial measure. The definition of the non-GAAP financial measure, along with the reconciliations to the related GAAP measure, are described in our press release. With these remarks, I'd now like to turn it over to John. John T. Standley: Thank you, Matt, and thank you, everyone, for joining us this morning to review our fiscal 2012 fourth quarter and full-year results. As I commented in this morning's press release, we made strong progress in the fiscal year highlighted by same-store sales and adjusted EBITDA increases for the fifth consecutive quarter. During the fourth quarter, our same-store sales grew by 3% while script count increased by 2.4% over the prior year period. In addition, adjusted EBITDA increased by $58.9 million due to our same-store sales growth, improvements in FIFO gross margin and the extra week in fiscal 2012. For the full year, same-store sales increased by 2% while the number of prescriptions filled in same stores increased by 0.9%. Adjusted EBITDA for the year grew to $942.9 million, an increase of $83.9 million over the prior year period. Net loss narrowed for both the fourth quarter and the full fiscal year. Our top priority for fiscal 2012 was to grow the top line. And we achieved that, thanks to the hard work and dedication of the entire Rite Aid team. We successfully executed key initiatives like wellness+, our flu immunization program, wellness store remodels and our Rite Aid private brand program. We feel positive about these improved business results. And although there are still hard work ahead of us in our turnaround efforts, I'm pleased that we generated significant, positive momentum and that we're heading in the right direction as we begin our new fiscal year. We are particularly pleased with our immunization efforts this year. Through the end of our fiscal year, our more than 11,000 certified immunizing pharmacists had administered nearly 1.5 million flu shots for fiscal year 2012, more than double our total for last year. In February, the American Pharmacists Association recognized our efforts by presenting Rite Aid with the prestigious Immunization Champion Award. Our store teams also did a great job in accommodating new customers who filled prescriptions with us due to the changes to the Express Scripts pharmacy benefit management network. Our chain-wide marketing campaign helped convince these customers to try our stores, and our store teams have responded by providing excellent service. We believe our customer loyalty program, wellness+, continues to be highly successful, thanks to the program's robust reward structure and the overall Rite Aid team's commitment to making sure our customers know what wellness+ has to offer. Total enrollment in the program has increased to 52 million members. With almost 2 years of member activity, we now have enough history and comparative data that going forward, we will measure active members as those who have used their cards at least twice during the last 26 weeks. Using this measurement, we had 25 million active members at the end of the fiscal year, which is a 16% increase in active members over the same period last year. Customers have also responded positively to the program enhancements we made this quarter like the first-in-the-industry Load2Card coupon tool, which enables customers to download online coupons directly to their wellness+ card and have the amount automatically deducted when they present their card to purchase the items in the store. We also launched new rewards for the members who earned 500 points and become silver-tier members. In addition to the 10% discount on qualified front-end purchases for 1 year, these members can now also choose from several rewards choices including a health screening, membership to a well-known fitness center, a subscription to one of several general interest consumer and lifestyle magazines or a 1-year GNC Gold Card membership. The new reward choices demonstrate our commitment to keeping wellness+ fresh and relevant to our customers. We believe wellness+ is the strongest rewards program in our industry and are committed to making it even better while finding ways to deliver more value to our most loyal customers. That continues to be important because wellness+ members accounted for 74% of front-end sales and 68% of prescriptions filled during the quarter compared to 66% of front-end sales and 58% of prescriptions filled for the same period last year. We have also continued to increase the amount of Gold and Silver members that we have in the program, which is important because these customers continue be our most valuable and most satisfied customers. In the pharmacy, we continue to see a much higher retention rate with members versus nonmembers, and members continue to be a very high percentage of our best patients. We continue to embrace technology as a way to enhance the customer experience. We completed the development of our new mobile app, which is now available for download for both the Android and iPhone platforms. This free app allows our customers to use their smartphones to order refills by scanning their prescription bottle, manage their wellness+ account, access weekly circular to view sale items and locate a nearby Rite Aid store using GPS. We also completed a multi-year rollout of our new and improved Rite Aid brand architecture. We have converted about 2,900 items to this new architecture, and customers are responding positively to our private brands and package designs. For the quarter, private brand penetration increased to 18.3% from 16.5% in the prior year period. Making our customers aware of the value, value offered by these items will continue to be a top priority heading forward. We have also continued to convert high-performing stores to our new wellness format, ending the quarter with a total of 280 wellness stores. And while it's still early on in the process, we are starting to see a positive impact on our front-end sales. As we've previously discussed, these stores emphasize wellness empowerment through increased emphasis on clinical pharmacy services, new wellness-related items and a more open store design to enhance the shopping experience. We now have more than 400 wellness ambassadors with specially programmed iPad to help customers access quality information about over-the-counter products, vitamins and supplements. Wellness ambassadors provide information to customers and act as a bridge from the front end to the pharmacy, where pharmacists are available to offer clinical advice and help customers select the right products for their specific needs. Also in the quarter, we completed approximately $7 million in prescription file buys, bringing our fiscal 2012 total to more than $35 million. As I said earlier, our results have given us significant momentum heading into fiscal 2013. Our goal for next year is to build on this momentum by continuing to grow top line sales and improve the customer experience. Our wellness+ program will continue to be the core focus of Rite Aid's overall marketing and promotional initiatives. And in fiscal year 2013, we will expand the delivery of targeted offers to wellness+ members. We also plan to complete 500 wellness store remodels in fiscal 2013 to deliver this enhanced shopping experience to more customers and drive continued sales improvements. In the pharmacy, we will continue to embrace a new era of patient care by expanding our clinical service offerings with more focus on improving medication compliance and care for patients with diabetes. We will further build on this year's highly successful immunization program. We will also look to grow script count through initiatives such as prescription file purchases, for which we have earmarked $50 million for this year. In terms of pharmacy gross margin, the generic wave and focus on generic cost control will provide a benefit, but this benefit will be pressured by continued declines in reimbursement rates. Looking at SG&A expenses, we will continue to focus on good cost control by enhancing efficiency through project simplification and indirect procurement, while we expect to see continued inflation in employee health costs and wages. And last but not certainly least, we'll remain focused on providing superior customer service, executing our debt program to greet, engage and thank every customer and through other in-store customer service and improved retail execution programs. We believe that these initiatives will continue to drive our same-store sales growth and control our costs, both of which are critical for our continued success. I will now turn it over to Frank to provide additional financial details on the quarter as well as our fiscal year '13 outlook. But in summary, all in all, we had a strong fourth quarter and a much improved fiscal year. Thanks again to all Rite Aid associates for their hard work, dedication and commitment to making positive strides in fiscal 2012. Our goal is to do it again in fiscal 2013. Frank? Frank G. Vitrano: Thanks, John. Good morning, everyone. As John mentioned, fourth quarter sales and earnings were strong reflecting good progress in our turnaround and the benefit of the various initiatives we've been working on for the past few years, as well as new ESI business and the benefit of a 53rd week in the quarter. This is the fifth consecutive quarter of EBITDA and same-store sales growth. On the call this morning, I plan to walk through our fourth quarter financial results, discuss our liquidity position, certain balance sheet items, our capital expenditure program and finally, provide fiscal '13 guidance. As previously reported, revenues for the quarter were $7.1 billion, which was a 10.7% increase to last year's fourth quarter. Without the extra week, total sales increased 3% over the prior year's quarter. This was the third consecutive quarter of total revenue growth reflecting the improvement in same-store sales and fewer store closings. In the quarter, we closed 12 stores and did not open any net new stores. On a year-over-year basis, we operated 47 net newer stores. Same-store sales increased 3% in the quarter reflecting the positive impact of wellness+ and positive script count. Front-end same-store sales were up 1.6% and pharmacy same-store sales were higher by 3.8%. Pharmacy comp scripts were positive 240 basis points. Pharmacy same-store sales were positively impacted by strong script growth and brand drug inflation, but included an approximate 216 basis point negative impact from new generic drugs. Adjusted EBITDA in the quarter was $274.3 million or 3.8% of revenues, which was $58.9 million or 27.3% higher than last year's fourth quarter of $215.4 million or 3.3% of revenues. The impact of the extra week was approximately $17.8 million. Without the extra week, adjusted EBITDA grew 19.1%. New incremental ESI script benefit in the quarter is estimated to be $8 million net of variable cost and incremental advertising expenses. We believe we are getting our fair share of new ESI scripts. Excluding the extra week and our new ESI business, adjusted EBITDA grew 15% over the prior quarter. The results were driven by favorable sales trend, improved gross margin trends and continued expense control. Net loss for the quarter decreased to $161.3 million or $0.18 per diluted share compared to last year's fourth quarter net loss of $205.7 million or $0.24 loss per diluted share. The net loss improvement was driven by higher adjusted EBITDA, lower lease termination and impairment charge of $98 million, lower depreciation and amortization expense of $19 million, and an income tax benefit of $24 million compared to an income tax expense of $1.5 million last year. Partially offsetting the improvement was a significantly higher LIFO charge, a $16.1 million loss on debt modification, which was not included in our guidance, and a lower gain on sale of assets of $10.5 million as compared to last year's fourth quarter. Our LIFO charge of $121 million was $120 million higher than last year. The increase in LIFO this year is driven by product cost increases in both front end and pharmacy. LIFO expense is booked quarterly based upon an annual estimate and finalized in the fourth quarter. This year, front-end inflation increased 2.2% versus 50 basis points last year. The categories which saw the strongest increases included coffee, candy and vitamins. Pharmacy inflation was also significantly higher this year, growing 8.4% versus 5% last year, driven by both higher brand inflation and less generic deflation. The decrease of $98 million in noncash lease termination and impairment charge was primarily driven by lower asset impairment charges in operating stores due to improved sales and earning performances in individual stores compared to our plan, as well as a decrease in lease exit cost due to reduction in a number of store closures. The lease termination charge includes 10 stores for which we recorded a closing provision during the fourth quarter. And we closed a total of 47 stores in fiscal '12. The gross margin dollars -- total gross margin dollars in the quarter was $81 million higher than last year's fourth quarter and down 1.4% as a percentage of sales. FIFO gross margin dollars were higher by $201 million or 27 basis points. Adjusted EBITDA gross profit, which includes specific items, primarily LIFO and wellness+ revenue deferral, the details of which are included in the fourth quarter fiscal '12 earnings supplemental information, which you can find on our website, was favorable to the prior year fourth quarter by $200 million and 24 basis points as a percent of revenues. Front-end gross profit and rate were both higher driven by a strong Rite Aid brand penetration, partially offset by higher tier discount investments related to wellness+ customer loyalty program. Pharmacy gross profit dollars were also higher, but lower than last year on a rate basis with continued pressure on reimbursement rates partially offset by the benefit of generic Lipitor. Selling, general and administrative expenses for the quarter were higher by $128.3 million but 65 basis points lower as a percent to revenues as compared to last year. SG&A expenses not reflected in EBITDA were lower by $13.4 million primarily due to lower depreciation and amortization expense. Adjusted EBITDA SG&A dollars, which again excludes specific items, the details of which are included in the fourth quarter of fiscal '12 earnings supplement, were higher by $141 million and lower by 26 basis points as a percent to revenues. The increase in dollars primarily reflect extra -- reflect expenses associated with the 53rd week. We continue to believe there are opportunities for us to lower our operating costs through store level work improvement, introduction of new technology as well as indirect procurement initiatives. Turning to the balance sheet. FIFO inventory was $168 million higher than the fourth quarter of last year. The increased inventory reflects price increases as well as initiatives to reduce out of stocks, whereby we increased the minimum stock inventory on certain items, as well as increased the amount of inventory for ad items. We continue to refine the inventory increases and believe these modifications increase sales. Our cash flow statement results for the quarter show net cash from operating activities in the quarter as a source of $10.5 million as compared to a use of $72 million in last year's fourth quarter. Higher inventory as well as the timing of accounts payable payments at year end influenced the balance. For the full year, net cash from operating activities was a source of $267 million. Net cash used in investing activities for the quarter was $66 million versus $54 million last year and also includes proceeds from the script file sales. For the full year, net cash used in investment activities was $221 million. During the fourth quarter, we relocated 2 stores, remodeled 121 stores and closed 12 stores. Total cash capital expenditures were $75.9 million. For the year, we completed and grand reopened 274 wellness remodels and had a total of 280 wellness remodels in the chain. Total cash capital expenditures were $250 million. Now let's discuss liquidity. At the end of the fourth quarter, we had $913 million of liquidity. We had $136 million revolver borrowing outstanding under our $1.175 billion senior secured credit facility with $128 million of outstanding letters of credit. Today, we have just over $1 billion of liquidity. Total debt, net of invested cash, was higher by $51 million from last year's fourth quarter. The increase in debt was driven by higher revolver borrowings as a result of our inventory position. Our leverage ratio defined as total debt less invested cash over LTM adjusted EBITDA improved to 6.7x through 7.2x. We generated free cash flow of $22 million for the year, which was in line with our expectations. Now let's turn to fiscal '13 guidance. We developed our plan based on current sales trends including continuation of existing incremental ESI script trends, benefit of the generic wave and generic cost controls, a challenging reimbursement rate environment, and continued investment in our customer loyalty program to grow sales, as well as an increase in capital expenditures. The company expects total sales to be between $25.4 billion and $25.8 billion and expects adjusted EBITDA to be between $925 million and $1.025 billion. Same-store sales are expected to be in the range of flat to up 150 basis points, which reflects the anticipated negative pharmacy sales impact of approximately 120 basis points from the new generic introductions -- I'm sorry, 520 basis points, excuse me, approximately 520 basis points from new generics introductions. Net loss for fiscal 2013 is expected to be between $267 million and $103 million or a loss per diluted share of $0.31 to $0.13. Net loss does not include any provision for a loss on debt modification from any refinancings which may occur during the year or results of a previously disclosed income tax matter, which is being considered by the IRS appellate division. This tax matter relates to the conclusion of the pre-acquisition periods audit of the consolidated federal return for Brooks Eckerd. Settlement of this cash matter will not have -- will not affect cash or net loss or net loss per share due to the indemnification asset from PJC, which completely offsets any tax liability. Our LIFO expense for fiscal '13 reflects our expected lower inflation rate for both front end and pharmacy as compared to this year. Our fiscal '13 capital expenditure front end was increased to $300 million, with $130 million allocated to remodels and $50 million for file buys. We are planning to complete 17 relocations and remodel 500 wellness stores. We are not planning to complete any sale-leaseback transactions, and we expect to be free cash flow positive for the year. We expect to close a total of 50 stores, of which the guidance includes a store of lease closing provision to close 20 with the balance of the stores closing upon lease expiration. Included in our net loss guidance is wellness+ deferral provision range of $18 million to $22 million, fiscal '13 deferral is incremental to the fiscal '12 charge due to anticipated growth in the program membership overall and a new benefit level for calendar '13. That completes my portion of presentation. I'd now like to open the line up for questions.

[Operator Instructions] Your first question comes from the line of John Heinbockel with Guggenheim. Steven Forbes - Guggenheim Securities, LLC, Research Division: It's actually Steve Forbes on for John. Just a couple of things. The wellness+ remodels, where do they stand with respect to comps especially the front end? John T. Standley: Getting better. I think we said on previous calls that they were in line with total company comps. They're now exceeding total company comps and headed towards our goals. So we're making some solid progress there. Steven Forbes - Guggenheim Securities, LLC, Research Division: In the pharmacy as well? John T. Standley: The pharmacy is lagging behind a little bit, but we expect to see those trends develop over time as well. Steven Forbes - Guggenheim Securities, LLC, Research Division: Okay. And then given Congress's inquiry, how will the role of the wellness ambassador change and does this impact the rollout at all? John T. Standley: Don't expect the role of the wellness ambassador to change at this time, and we're continuing with our rollout. Steven Forbes - Guggenheim Securities, LLC, Research Division: Then lastly, just on a pricing and promotions, it's -- it appears that it's -- the environment may have eased a little bit in recent months. Do you agree? And then is it an opportunity for you to ease as well, or would you rather step up the promotion a little bit? John T. Standley: I mean, I think we're satisfied with the investments that we're making and progress that we're seeing on our top line. I would probably say that it's been particularly soft from a promotional perspective, and we expect the current environment to continue.

Your next question comes from the line of Carla Casella with JP Morgan. Carla Casella - JP Morgan Chase & Co, Research Division: A couple of quick ones. On the private brand, how far do you think that can go in terms of adding more private brand to the store? John T. Standley: I think there's still great opportunity for growth. I mean, our focus has been really getting ourselves rebranded and really kind of stepping up our game, which I think we've done a great job with, but we still have opportunity to continue to add items and grow private brand sales for sure. Carla Casella - JP Morgan Chase & Co, Research Division: Okay. And then on the wellness remodels, how many of the total company stores ultimately could fit this wellness remodel? I'm assuming not every one would be remodeled because of either a demographic or a potential closure, but how many in total could be remodeled? John T. Standley: I mean, a very significant number of our stores work in this format. So it's going to be 2/3, 3/4, it's going to be a lot. Carla Casella - JP Morgan Chase & Co, Research Division: Okay. Anything you can do about that $275 million to $300 million a year? Frank G. Vitrano: Well, this year, we'll -- Carla, this year, we're financing $500 million. Carla Casella - JP Morgan Chase & Co, Research Division: Okay. I missed that, sorry. And then, how much is your dark store rent? John T. Standley: It's about $91 million this year, Carla, and we expect that number to drop somewhere in the $80 million to $85 million range next year.

Your next question comes from the line of Karru Martinson. Karru Martinson - Deutsche Bank AG, Research Division: This is Karru Martinson with Deutsche. When we look at the decrease of pharmacies in the Express Scripts network as they called out in your guidance for fiscal 2013, how much is that driving the sales and what would happen if that was to reverse itself? John T. Standley: Two questions. So I guess on the first question, what I would point you to is, if you look at our trends before the change to the Express Scripts network, we were kind of running in the 50 basis point range, it's kind of our steady state script count growth. So I think if you look at what's above that, that's common indication of what the impact has been. If that reverses itself, then we're going to have to work our way through that and try to hang on to as many of those scripts as we can. Karru Martinson - Deutsche Bank AG, Research Division: And then what's your relationship with Medco, and how's that contract governed? John T. Standley: Well, I mean, you're right. It has a contract that governs our relationship. That would be factually correct. Karru Martinson - Deutsche Bank AG, Research Division: And they're up for renewal or anything along those lines? John T. Standley: Yes, I mean, we generally -- all those contracts have confidentiality clauses in them, so we don't generally comment about the terms of them. Karru Martinson - Deutsche Bank AG, Research Division: Okay. When you look at the prescription file buys that you're planning for this year, I mean, are you still looking at valuations in kind of 10 to 20 per script valuation? And then would that be applicable to your own script base? Frank G. Vitrano: Current assets, that's pretty much the range that we've seen. There are particular instances where it might go north of that if there's a more competitive activity, if there's 2 or 3 guys that are bidding for that. But that's generally a pretty good range. Karru Martinson - Deutsche Bank AG, Research Division: Okay. And just lastly, what was the drag on your performance from the weak flu season this year? John T. Standley: I mean, it's hard to give you an exact number on that, but it's probably, at least 100 basis points script count, probably. That's probably in the range.

Your next question comes from the line of Karen Eltrich of Goldman Sachs. Karen Eltrich - Goldman Sachs Group Inc., Research Division: As you mentioned, you have 2 years now of data from wellness+. As we look to the year ahead, what kind of data mining opportunities do you see? John T. Standley: I think it's a big, big opportunity. As you know, we move forward. It has taken some time to accumulate enough information to kind of get to the kind of analysis that we'd like to do. So we see it as a key opportunity for this next fiscal year. It's a pretty good-sized opportunity. Karen Eltrich - Goldman Sachs Group Inc., Research Division: Particularly in relation to trying to convert front-end users to pharmacy users? John T. Standley: I think it can work both ways. But also, I think we have the opportunity to probably just be more targeted, more tailored to individual members' needs with what we offer. And I think that's a big opportunity for us. Karen Eltrich - Goldman Sachs Group Inc., Research Division: Great. And following up on Carla's question, what was private label penetration for the quarter, and how did it compare to last year? John T. Standley: 18%, it was 18.3% for the quarter versus 16.5% last year. Karen Eltrich - Goldman Sachs Group Inc., Research Division: And do you have a target for this year? John T. Standley: I mean, there is some seasonality in the numbers. So it's always a little higher in the fourth quarter so I think if we can get through the year, somewhere about where we ended this last year in the fourth quarter, that will be up pretty good improvement for us. Karen Eltrich - Goldman Sachs Group Inc., Research Division: Great. And with regards to Lipitor with the rebate program that they have, what kind of impact do you think that had and when will we start to see more of a benefit from that? John T. Standley: I think we did see a lower penetration of Lipitor in terms of how it converted to generic versus how a traditional drug might have come over. It's gradually sort of inching its way towards more normal levels. So I think it'll continue to be a gradual transition or, yes, I think Robert's giving me the nod yes. One -- yes, and then, Chris is pointing out, once the exclusivity period is over, probably then maybe more converts. Probably that rebate is going to go away. Karen Eltrich - Goldman Sachs Group Inc., Research Division: And question for Frank. You've done an enormous job with your working capital. What are we looking for the year ahead? With the sales growth, should we expect working capital to actually be a use to capital this year? Frank G. Vitrano: Right now, I think you might see a slight use of -- I don't think we're -- we don't have a ton of opportunities left to take inventory out. I think we're still fine tuning some things right now. But I wouldn't plan for modeling purposes to see that as a moving [ph] source.

Your next question comes from the line of Bryan Hunt with Wells Fargo Securities. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: I was wondering if you could, Frank, give us what the addition to Q4 EBITDA was from the extra week? Frank G. Vitrano: About $17.8 million. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: Pretty precise for an about. Frank G. Vitrano: Approximately $17.8 million. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: And then, you've got really good March same-store sales. Could you talk about whether you believe or could you quantify what the pull forward might be from a strong allergy season in early spring? John T. Standley: I mean, yes, I think those categories performed reasonably well. But I think we saw, generally speaking, broad, good results across a number of different categories. In March, there was also probably a little bit of impact from the change and timing of Easter. Frank G. Vitrano: And then if you look at the kind of the core drugstore categories, we performed very good in each of those. To some degree, I think in March, the warm weather certainly helped. If you looked at a couple of categories like skincare or beverages or what not, they were particularly strong. And we probably got some Easter benefit in the last week of March because of the fact that Easter this year was 2 weeks earlier than last year. But those are kind of the drivers, Bryan. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: And is there a way to quantify the Easter benefit for modeling purposes so we can maybe tweak April? Frank G. Vitrano: We'll let you know in a couple of weeks. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: Sounds good. And then when you look at the cost of an ambassador, is there any way for you all to measure the ROI or the sales conversion on how that ambassador converts somebody from the front of the store to the back of the store? John T. Standley: I mean, the way we would look at that honestly is just at the store trends, the store specific trends, that's the way we're measuring it. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: All right. And then my last question. When you look at fiscal '13, do you anticipate another year of free cash flow? Frank G. Vitrano: We do.

Your next question comes from the line of Matthew Fassler with Goldman Sachs. Matthew J. Fassler - Goldman Sachs Group Inc., Research Division: I've got 2 questions. The first revolves around the wellness stores and the improved results that you're seeing. Were there any changes that you made to the operating model over the last several months that you think contributed to these stores starting to break out on the front end, at least relative to the chain? John T. Standley: Nothing significant. As we've said, it's a process of continuous improvement. So we continue to work with the merchandising concepts in the store, but it's not really dramatic. I'd say it's just kind of gradual, steady change that we're making, and I think part of it's just time, it's like anything, it takes a little bit of time for these things to get some traction. And it seems to be really taking hold right now. Matthew J. Fassler - Goldman Sachs Group Inc., Research Division: Got it. And then the second question I have relates to the economics of the business that you're capturing from a Walgreen-Express fallout. You referred to the EBITDA benefit, sort of net of incremental labor and advertising, it's sort of a 2-part follow-up. The first is does this business get more profitable over time as presumably you have to commit less in the way of resources to win it as it first comes up for bid, if you will? And then, secondly, if that conflict gets resolved and presumably, some of that business ultimately goes back to Walgreen, how tough it would be to adjust the cost structure back? Would there be a lag in that process as well? John T. Standley: So yes. I mean, as Frank said, we did make some incremental investments. A big piece of that was advertising, which is probably not a go forward if we retain that business. So to your point, yes, it gets more profitable over time. And if that situation resolves itself, obviously, we're going to do everything we can to hang on to as many customers as we can, patients. And I think we can -- the way our labor model works, I think we can manage our way through whichever way that goes.

Your next question comes from the line of Lisa Gill with JP Morgan. Lisa C. Gill - JP Morgan Chase & Co, Research Division: I was just wondering, John, are you seeing or having any discussions around narrow networks with the PBMs where you would be the lead retail provider? John T. Standley: I mean, narrow networks come up all the time in discussions, and so we continue to look at the situation and evaluate those opportunities. But the whole concept of narrow networks is a little nerve-racking from my perspective in that it kind of feels like we're just going to move all the chairs around on the deck but nothing is really going to change, but rates are going to be a lot lower. So we're looking at the situation, I guess, is what I would tell you. Lisa C. Gill - JP Morgan Chase & Co, Research Division: I guess what I'm trying to get at is do you feel that because of this Express Scripts/Walgreens dispute, are there more customers, whether it's planned sponsors or PBMs that are interested in having that discussion this year versus last year, or do you feel like it's the same that it's always been over the last several years? John T. Standley: I would say -- I'm hearing -- there's probably 2 different things. I think we are seeing more inquiries about narrow networks, but we also hear from consultants that not that many clients are interested in it. So we don't know which way the thing is going. Lisa C. Gill - JP Morgan Chase & Co, Research Division: Yes, I guess, we're all going watch and see. John T. Standley: Yes, I think we're all going to watch and see. Lisa C. Gill - JP Morgan Chase & Co, Research Division: And then, Frank, I think you made a comment around brand price inflation as well as lower drug price deflation on the generic side. Can you maybe just talk to us about how that's impacting the model especially on the generic side? If we're seeing less drug price deflation, is that better for your model or is it worse for your model, and what are your expectations? I mean, we obviously have a lot of generics that are coming in the next several months. Lipitor will now move beyond exclusivity of PLAVIX, et cetera. How should we start to think about generics as we move through your next fiscal year? John T. Standley: It's a good question. But I mean, again, we expect the generic profitability is going to go up as we see all these items go generic, if that's the question. Frank G. Vitrano: Yes. If you look at -- this year was particularly unusual. We're typically -- we would see significantly higher brand generic deflation, okay. On the deflation, typically, we would see significantly more brand deflation. This year, we just didn't, okay. And this was an anomaly for us. And we can go back to last, probably 5 or 6 years, we didn't see this level of deflation, okay, in the last probably 5 or 6 years or so. So I mean, I would anticipate it's going to return back. Generally, we can expect that there's more deflation that's better for us, okay. And that's kind of how I would think of that. Lisa C. Gill - JP Morgan Chase & Co, Research Division: I think that's what I'm trying to figure out. So is deflation better for you? Because generally, if I think about reimbursement rates, right, they're usually tied to some methodology, AWP, MAC or something else. And what we've heard from some other retailers is that it really depends on the spread and how well you can buy the drugs. So is your expectation that we'll see greater drug price deflation on generics but you'll be able to capture more of the spread than you have in the last 12 months, or the last 12 months was better for you because the reimbursement rates stayed higher? John T. Standley: So I think we're in a little bit of a discussion about life cycle on drugs and probably some different kinds of contracts that we have. And so I think we've talked about when generics -- when brands go generic, they can go with exclusivity. And so there's 6 months where there's 1 or maybe 2 providers of that drug in which case, the cost generally stays higher, but the reimbursement rate is generally higher as well. Okay? And then, after 6 months, it will go multi-source, in which case the cost will come down and the reimbursement rate will come down. The other dynamic that goes into that process is what kind of contract we might have. Some contracts we have, have a, we'll call kind of a fixed reimbursement rate where we get paid an AWP minus rate on all generics. And other contracts have MAC clauses in them, where we get MAC. And so depending on which kind of contract we have, the 2 things will behave very differently depending on where the drug is in its life cycle. In a MAC contract, we make a lot of money when the drug is in the stages of its life cycle before it goes multi-source and it gets MAC on a guaranteed reimbursement rate contract that goes the other way. We'll probably make less money in the early part of the life cycle and actually make more in the backside of the life cycle. And so they kind of move opposite directions. All in all, we just make more money when drugs become generic from brand and when you sort of blend it all together, it just -- it sort of mixes out where we probably, right now, are making a little bit less money in the first 6 months and more money once they go multi-source. Lisa C. Gill - JP Morgan Chase & Co, Research Division: Okay, that's very helpful. So therefore, you're... John T. Standley: A little bit of a long-winded explanation, I apologize. And since there's a number of different dynamics that are going on and depending on who you talk to, you could be getting different answers too. Lisa C. Gill - JP Morgan Chase & Co, Research Division: Right. Right. And I just want to think about this correctly for your fiscal year. So it sounds like generic should be a tailwind for you in fiscal '13 because of the timing aspect and the way that certain drugs are rolling off of exclusivity, as well as some of the newer drugs that are going to come on and won't have exclusivity and the way you have contracts AWP versus MAC lined up. Is that the right way to think about it? John T. Standley: That's right.

Your next question comes from the line of Mary Gilbert with Imperial Capital. Mary Ross Gilbert - Imperial Capital, LLC, Research Division: Just wanted to follow up on that discussion. So when we're looking at the guidance -- I just wanted to be clear, but on the guidance, your guidance is not -- for fiscal '13, it's not factoring in the benefit currently from Walgreens. Is that correct? John T. Standley: Actually, it is. Frank G. Vitrano: It is. The existing incremental ESI scripts that we're gaining, we're assuming that we'll continue to get those -- that benefit. Mary Ross Gilbert - Imperial Capital, LLC, Research Division: Okay. So in other words, if there is some sort of change where Walgreens enters into some agreement with Express Scripts, and we don't -- we see that windfall going forward, then there could be an adjustment to the guidance, is that fair to say? Frank G. Vitrano: That will bring us to the lower end of the guidance, Mary. Mary Ross Gilbert - Imperial Capital, LLC, Research Division: That would bring to the lower end. Okay, got it. And then, I didn't get what the actual magnitude was from a comp sales perspective. So when we look at March, for example, how much of the Walgreens benefit was in the comp sales number? Frank G. Vitrano: Well, for March, we were up, the scripts were up 2.6% as John mentioned earlier. The run rate prior to that was 50 or 60 basis points up. So that will give you some idea of what we think the incremental benefit was. Mary Ross Gilbert - Imperial Capital, LLC, Research Division: Okay. All right. And then, once again, on looking at the conversion to generics. So it sounds like you have a higher mix of guaranteed reimbursement rates in the portfolio of generics, and that's why you've got this sort of tailwind impact. Is that fair to say? John T. Standley: It's actually probably closer to kind of half and half. It's kind of the range. Mary Ross Gilbert - Imperial Capital, LLC, Research Division: All right. It must be the waiting. John T. Standley: That's a rough estimate. Mary Ross Gilbert - Imperial Capital, LLC, Research Division: Okay. And then just going back to the wellness+ initiative. So the comp sales currently in those stores are comping better than the chain? John T. Standley: Yes. Mary Ross Gilbert - Imperial Capital, LLC, Research Division: So it's a recent improvement. And then you said, so it's moving towards your target. So what is the target? Frank G. Vitrano: The target was 3% above the chain average. Mary Ross Gilbert - Imperial Capital, LLC, Research Division: 3% above chain. Okay. And then is that just the front end? Was that for both, and what is it between front end and pharmacy? John T. Standley: I'm sorry, Mary -- so the goal, the overall goal is really 3% on total sales. And what we said was that on the front end, we've seen very nice improvement kind of started in the fourth quarter really into March. We've seen some good strong comps out of the wellness stores above the chain average. The pharmacy is lagging behind, but we expect it to catch up over time. It's just going to take a little while for the pharmacy to get there. It's always a little slower in pharmacy. Mary Ross Gilbert - Imperial Capital, LLC, Research Division: Okay. And so this is just normal, the way it sort of works in getting that conversion? John T. Standley: That's what we think. Mary Ross Gilbert - Imperial Capital, LLC, Research Division: Okay, great. All right. Super. Also, just given the strength of the financial markets, the strength in your finance performance, do you see some capital structure refinancing opportunities? Frank G. Vitrano: Mary, as we said in the past since we did back in February, we're always looking at the market and looking for ways to continue to give us some additional flexibility. So we do have some tranches that come due in '15 and beyond. So you shouldn't be surprised if at some point we come back to the market looking to do additional refinancing.

Your last question will come from the line of Ed Kelly with Crédit Suisse. Edward J. Kelly - Crédit Suisse AG, Research Division: I wanted to start off with the guidance. The low end of guidance, if you exclude the extra week from last year, it looks to imply about flat EBITDA. And I'm just curious under what scenario would you expect to see that, because obviously generics are going be positive. Even if the Walgreens/Express Scripts dispute is resolved tomorrow, they're not going to get all those scripts back, right? So there's going to be some benefit there that takes place for the rest of the year. So if you could just help us out, what parameters you've sort of built in around the low end of that guidance and why we would possibly see slight earnings in this year? Frank G. Vitrano: Ed, I think it's really driven by 2 things. One is would be is that we don't see the continued benefit from incremental ESI scripts, okay. And we see more challenging reimbursement rate pressure. John T. Standley: Right, we don't get as much benefit from the new generics as we think we might. Frank G. Vitrano: I think that's really the driver to the low end here. Edward J. Kelly - Crédit Suisse AG, Research Division: Okay. And I know, I mean, historically you've been a little bit conservative around your guidance, and I guess the question related to all of this is how much visibility do you have right now on reimbursement rate pressure and the profitability of generics in the upcoming year? John T. Standley: So I think it's reasonably good. I mean, there's some fairly big things moving around the industry here that are going to play out. It could kind of swing things one way or the other. One example would be AMP. So what is the timing of AMP and what it's really going to look like when it's done is a pretty good question. We've included some estimates on our guidance, but that could potentially move around either from timing or from items included or from definitions or from a number of different angles. So that would be one example of the kinds of things that are moving around. On our existing core business, we've done a fairly good job of, I think, kind of getting closer to being able to forecast more accurately what those numbers are going to look like. But this year is a little unique in that where we've got mergers and we've got AMPs, and we just got a lot of different things that are going on that we've got to kind of estimate our way through. Edward J. Kelly - Crédit Suisse AG, Research Division: Okay. And you mentioned this quarter that the pharmacy gross margin was down and I know it's not a big generic quarter particularly given what's been going on with Lipitor. But when would you expect the pharmacy margin to start to trend positively as we think about the next 4 quarters or so? Frank G. Vitrano: Well, it's naturally going to go a little higher only because the total revenues are going to decline as a result of the introduction of new generics. So just kind of a math, it's going to be a driver to that. John T. Standley: But I mean, we obviously, have new generics coming to market right now that are going to be helpful. And as we accumulate more during the year, we'd expect the back half of the year to probably be more profitable in the pharmacy than the first half. Edward J. Kelly - Crédit Suisse AG, Research Division: Okay. And then last question for you is on the remodel. Can you just remind us of how much you're spending on a per-store basis for the wellness+ remodels? What exactly that entails and how are you choosing which stores to remodel first? Frank G. Vitrano: Yes. So we're spending at about $250,000 per remodel. The lion's share of that is spent what we'll characterize kind of the front end of the store. We are spending somewhere around $50 million -- $50,000, excuse me, $50,000 per store in the pharmacy, and that's primarily around introducing a new consultation room and the seating in the waiting area so that's kind of baked into that $250,000 per investment. In terms of how we choose a store, right now what we're looking at is -- it's really a process of looking at some of our better stores in some of our key markets to reinvest in kind of the top guns.

Thank you, everybody. This concludes our conference call. Appreciate everybody participating, and we'll talk to you next quarter. John T. Standley: Thank you. Frank G. Vitrano: Thank you.

Ladies and gentlemen, that does conclude today's conference call. You may now disconnect.