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

Edward J. Kelly - Crédit Suisse AG, Research Division Stephen V. Tanal - Goldman Sachs Group Inc., Research Division John Heinbockel - Guggenheim Securities, LLC, Research Division Carla Casella - JP Morgan Chase & Co, Research Division Joseph Stauff - Susquehanna Financial Group, LLLP, Research Division Mark Wiltamuth - Morgan Stanley, Research Division Jason DeRise - UBS Investment Bank, Research Division Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division

Good morning. My name is Felicia, and I will be your conference operator today. At this time, I would like to welcome everyone to the Rite Aid Third Quarter Fiscal 2013 Conference Call. [Operator Instructions] Thank you. Mr. Schroeder, you may begin.

Thank you, Felicia, and good morning, everyone. We welcome you to our third quarter conference call. On the call with me are John Standley, our Chairman, President and Chief Executive Officer; Ken Martindale, our Chief Operating Officer; and Frank Vitrano, our Chief Financial and Chief Administrative Officer. On today's call, John will give an overview of our third quarter results and discuss our business. Ken will give an update on some of our key initiatives. Frank will discuss the key financial highlights and fiscal 2013 outlook, and then we will take questions. As we mentioned in our release, we are providing slides related to the material we will be discussing today. These slides include annual earnings and sales guidance. These slides are provided on our website, www.riteaid.com, under the Investor Relations Information tab for conference calls. This guidance is a point-in-time estimate, and 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 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 that 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. Also included in our slides are the non-GAAP financial measures of adjusted EBITDA gross profit and adjusted EBITDA SG&A and the reconciliations of those measures to their respective GAAP financial measure. With these remarks, I'd now like to turn it over to John. John T. Standley: Thank you, Matt, and thank you all for joining us this morning to review our third quarter results for fiscal 2013. During the quarter, we reached a significant milestone in our turnaround efforts by earning net income of $61.9 million or $0.07 per diluted share compared to a net loss of $52 million or $0.06 per diluted share in the previous year's third quarter. In addition, we achieved a company record of $295.3 million in adjusted EBITDA, an increase of nearly $74 million over the prior year period. This improvement was driven by increases in front-end [ph] sales and prescription counts, as well as an improvement in pharmacy gross margin. We have now increased both adjusted EBITDA and same-store prescription counts for 8 consecutive quarters. Additionally, our year-to-date net loss has narrowed to $5 million. These results were driven not only by our recent business trends but also by our nearly 90,000 Rite Aid associates who have worked hard for the past several years to fundamentally improve our business and generate the positive momentum we've experienced over the past 2 years. I am proud that we have achieved this significant milestone by putting our customers first and challenging ourselves to better serve them. During the quarter, we continued to experience steady growth in front-end same-store sales, which increased 1.1%. In addition, we saw a strong growth in prescriptions filled in same stores, which increased 3.6% and includes the benefit of the additional prescriptions resulting from the Express Scripts/Walgreens dispute. Another key trend was the wave of new generic medications, which was the primary driver of our increase in gross profit. Our generic penetration during the quarter crossed through the 80% threshold, as patients sought these lower-cost options for their medication therapy. At the same time, the new generics negatively impacted our pharmacy same-store sales by approximately 924 basis points. This is a key factor behind the 2.7% decrease in pharmacy same-store sales and our 1.5% decrease in total same-store sales. Immunizations had a positive impact on same-store prescription counts and remain a top priority, as we look to promote the convenience of getting a flu shot from your neighborhood Rite Aid pharmacist. To date, our pharmacists have given over 1.8 million flu shots and are on pace to achieve our goal of administering 2 million flu shots this year. In early December, we saw an increase in flu shot activity in response to widespread reports concerning the early arrival of flu this year and the potential for a severe flu season. We're using this opportunity to educate patients about other immunizations and clinical pharmacy services we can provide on a state-by-state basis. Another driver of our prescription count results has been our ability to retain the vast majority of patients who came to Rite Aid as result of the Express/Green -- of the Express Scripts/Walgreens dispute. One factor has been our commitment to providing outstanding customer service to these patients, and our teams on the ground have done a tremendous job of bringing this to life. At the same time, we have focused on enrolling these patients in our award-winning wellness+ customer loyalty program. We've also been successful in sending targeted special offers to these patients and communicating the value of remaining a loyal Rite Aid customer. At this point, I'm going to turn it over to our Chief Operating Officer, Ken Martindale, to provide some additional details on our wellness+ program and other key sales and operating initiatives. Ken? Kenneth A. Martindale: Thanks, John, and thanks, everybody, for joining us today. Our highly successful and well-received wellness+ customer loyalty program continues to play a critical role in driving our positive sales momentum. At the end of the quarter, we had approximately 25 million active members, defined as those who have used their card at least twice in the past 26 weeks. That number is consistent with last quarter and represents a 5% increase over the same period the previous year. The number of Gold and Silver members, our most valuable and most satisfied customers, continues to increase, and card usage remains strong. wellness+ members accounted for 76% of front-end sales compared to 72% the previous year and 67% of prescriptions filled compared to 66% in the prior year period. In short, wellness+ is the richest and most rewarding loyalty program in our industry, offering robust tiered rewards, wellness benefits, weekly value through +UP Rewards and exclusive sale pricing. The fact that we have been able to maintain our active membership in the face of a new competitive loyalty program demonstrates that our customers appreciate and understand the tremendous value wellness+ offers. We will continue to focus on finding new ways to make this highly popular program even stronger so that our customers can continue to take advantage of the value this exciting program offers. We remain on pace to achieve our goal of having nearly 800 wellness stores by the end of the fiscal year. During the third quarter, we converted an additional 117 stores to the wellness format, bringing our grand total to 687. In addition, we have now trained nearly 1,100 Wellness Ambassadors, and they are doing a tremendous job providing our customers with a one-of-a-kind shopping experience. We continue to see a positive impact on front-end sales in the wellness stores compared to the rest of the chain. As reported during our second quarter earnings call, we recently made significant enhancements to the wellness format. These genuine well-being stores feature a new interior design, additional wellness items and unique merchandising presentations. This new format has now been rolled out to 2 stores on the East Coast. We are getting tremendous feedback from customers, and we're excited to incorporate elements of this enhanced design into all wellness stores next year. Customers continue to respond positively to our new and improved Rite Aid brand architecture. We have followed up on last year's conversion of 2,900 items to this new architecture by enhancing the package designs of our seasonal private brand items. Rite Aid brand penetration for the quarter was 18.1%, an increase of 1.3% over the prior year period. Also during the quarter, we completed $25.7 million in prescription file buys, bringing our total for the year to $45.7 million. We are currently on pace to meet our goal of completing $60 million in file buys during the current fiscal year. To sum it up, we continue making progress in executing our key initiatives such as wellness+, wellness store remodels and other sales growth opportunities. We look forward to building upon these successful initiatives, as we look to further empower our customers to play a more active role in managing their health. Now I'm going to turn it over to Frank Vitrano for a report on our third quarter financial results. Frank? Frank G. Vitrano: Thanks, Ken, and good morning, everyone. As John mentioned, third quarter front-end sales, script growth and earnings were strong, reflecting good progress in our turnaround and the benefits of the various initiatives we've been working on. This is the eighth consecutive quarter of adjusted EBITDA and same-store script growth, and we continue to grow our front-end sales. We are especially pleased to report quarterly net income for the first time since the first quarter of 2008 -- of fiscal 2008. On the call this morning, I plan to walk through our third quarter financial results, discuss our liquidity position, certain balance sheet items, the capital expenditure program and, finally, update fiscal '13 guidance. As previously reported, revenues for the quarter were $6.2 billion, which was $75 million or 118 basis points lower than last year's third quarter. The decrease was primarily due to a higher percent of generic drug sales. In the quarter, we closed 10 stores and did not open any net new stores. On a year-over-year basis, we operated 46 net fewer stores. Same-store sales decreased 1.5% in the quarter, reflecting a higher generic penetration rate. Front-end same-store sales were up 1.1%, and pharmacy same-store sales were lower by 270 basis points, which included an approximate 924-basis-point negative impact from new generic drugs. Pharmacy same-store comps were positive 360 basis points, primarily driven by new ESI scripts. Adjusted EBITDA in the quarter was $295.3 million or 4.7% of revenues, which was $73.8 million or 33% higher than last year's third quarter of $221.1 million or 3.5% of revenues. Overall results were driven by favorable front-end sales, script growth and improved gross margin trends, partially offset by higher SG&A. The results include an $18.1 million or $0.02-per-share benefit related to a settlement of interchange fee litigation, which was not previously included in our guidance. New incremental ESI script benefit in the quarter is estimated to be $18 million to $22 million. We continue to believe we received our fair share of new ESI scripts through September 15 and are now retaining the lion's share of those new patients, even after Walgreens reentered the ESI network. December month-to-date same-store scripts remains strong due to continued high ESI retention and an increase in flu-related prescriptions. Net income for the quarter was $61.9 million or $0.07 per diluted share compared to last year's third quarter net loss of $52 million or $0.06 loss per diluted share. The improvement was driven by higher adjusted EBITDA and lower LIFO charge. Total gross profit dollars in the quarter were $139.9 million higher than last year's third quarter and 256 basis points higher as a percent of revenues. Adjusted EBITDA gross profit, which excludes specific items, primarily LIFO and the wellness+ revenue deferral, was favorable to the prior year third quarter by $106.2 million or 202 basis points as a percent of revenues. Front-end gross profit was essentially flat. Pharmacy gross margin dollars and rates were both higher due to script count growth and the benefits of new generics, partially offset by continued pharmacy reimbursement rate pressure. Pharmacy rate increase was also driven by the reduction in sales due to higher generic penetration. Selling, general and administrative expenses for the quarter were higher by $29.1 million or 77 basis points as a percent of revenues as compared to last year. Adjusted EBITDA SG&A, which excludes specific items, were higher by $32.4 million or 80 basis points. The increase in dollars reflects wage and benefit increases, as well as higher labor costs associated with incremental pharmacy staffing for the added script volume, as well as costs associated with the wellness remodel program, partially offset by the $18.1 million interchange fee settlement. Without the interchange fee settlement, adjusted EBITDA would have increased 25.2%. As previously disclosed, we had 790 stores initially impacted by Superstorm Sandy. Fortunately, we were able to reopen all but 9 stores within a week after the storm and with the vast majority opening within 72 hours. We sustained property losses, incurred extra expenses and realized some modest business interruption, which will be covered by insurance. The storm did not have a material impact on the quarter and will not have a material impact on our full year results. Turning to the balance sheet. FIFO inventory was $144 million lower than the third quarter of last year and $14 million lower than the fourth quarter of fiscal '12. Relative to the third quarter of last year, the decrease reflects a higher mix of generic inventory, which is valued at a lower cost than brand inventory as well as other inventory initiatives -- inventory reduction initiatives. Our cash flow statement result for the quarter shows net cash from operating activities in the quarter as a source of $269 million as compared to a source of $2 million in last year's third quarter. The improvement was driven by an increase in operating income along with higher payables and lower inventory this year. Net cash used in investing activities for the quarter was $96.4 million versus $57.5 million last year and also includes proceeds from script file sales. During the third quarter, we relocated 3 stores, remodeled 114 stores and closed 10 stores. We have now completed and grand reopened 687 wellness stores and expect to have 780 completed by fiscal year end. Front-end same-store sales in the wellness stores now exceed the non-wellness stores by over 300 basis points. Now let's discuss liquidity. At the end of the third quarter, we had $1.2 billion of liquidity, including $1.075 billion under our credit facility and $167 million of invested cash. We had no revolver borrowings under our $1.175 billion senior secured credit facility with $118 million of outstanding letters of credit. Total debt net of cash -- net of invested cash was lower by $325 million from last year's third quarter and $284 million lower than year end. Our leverage ratio defined as total debt less invested cash over LTM adjusted EBITDA improved to 5.6x from 7.1x as compared to the third quarter of last year. Now let's turn to fiscal '13 guidance. We are updating our guidance based on current sales trends and SG&A increases, the benefit of new generics, the interchange settlement, a challenging reimbursement rate environment, continued investment in our customer loyalty program to grow sales, as well as an assumption that we will retain a portion of the ESI incremental scripts. We also expect to incur added cost to retain the ESI business. The company expects total sales to be between $25.15 billion and $25.3 billion and expects adjusted EBITDA to be between $1.050 billion and $1.075 billion for fiscal '13. Same-store sales are expected to be in a range from a decrease of 90 basis points to a decrease of 30 basis points, which reflects the anticipated negative pharmacy sales impact of approximately 700 basis points from new generic introductions and continued reimbursement rate pressure. We expect a fiscal '13 earnings range of a net loss of $38 million or $0.05 per diluted share to net income of $33 million or earnings per diluted share of $0.03. The guidance doesn't include any provision for refinancing costs. Our fiscal '13 capital expenditure plan has increased to $360 million with $170 million allocated to remodels and $60 million allocated for file buys. The increase is attributable to more file buys and additional maintenance CapEx as part of the wellness remodels. The wellness remodels are now averaging $300,000 per store with approximately $78,000 of maintenance CapEx. We are planning to complete 13 relocations and remodel 500 wellness stores. We expect to be free cash flow positive for the year, and we expect to close a total of 50 stores, of which the guidance includes a store lease closing provision for 20 stores with the balance closing on lease expiration. We will provide fiscal '14 guidance on our fourth quarter earnings call. That completes my portion of the presentation, and I'd now like to turn it back to John. John T. Standley: Thank you, Frank. Looking ahead, we are excited about the culmination of our 6-month RA50 campaign to celebrate Rite Aid's 50th anniversary. Throughout the fall, we hosted 50 acts of wellness in major Rite Aid markets to recognize our long-standing tradition of providing personal healthcare services, health and wellness products and community partnerships. We were pleased to be able to partner with various local community groups in hosting these health and wellness activities as a way to thank the many communities that have helped us grow throughout the years. In January and February, we will cap off the successful celebration by holding special RA50 customer promotions that will feature some of our best values of the year. These sales events are a way for us to celebrate Rite Aid's 50th anniversary with our customers and to thank them for making Rite Aid their drug store of choice over the past 50 years. I'd also like to take a moment to acknowledge the tremendous efforts of our associates, as they dealt with the effects of Superstorm Sandy. We had nearly 800 stores closed during the height of the storm, and our associates did all they could to reopen these stores as quickly as possible so that we could serve our communities when they needed us most. Whether it was ensuring they could get to work or treating items for customers in the stores without electricity or operating temporary pharmacies to ensure patients received their much-needed prescriptions, Rite Aid associates lived up to our core value of being a caring neighbor and made this company very proud. Let me end by once again thanking our Rite Aid associates who have worked tirelessly to execute our key sales initiatives, operate more efficiently and improve the customer experience. Our net income for the quarter and record-high adjusted EBITDA are a direct reflection of their commitment to serving our customers, and we are thankful to have such a dedicated team working together to continue our positive momentum. That concludes our prepared remarks for today. Now we will open up the phone lines for your questions.

[Operator Instructions] And your first question comes from the line of Edward Kelly with Crédit Suisse. Edward J. Kelly - Crédit Suisse AG, Research Division: So I wanted to start off with the gross margin and specifically generics because that, obviously, I think relative to, at least, our expectation and probably the Street, seems to be a big area of the upside. Can you maybe talk about how generic profitability is stacking up against your initial expectations? It seems to be better. And so could you maybe talk about why that's the case? John T. Standley: Yes, I mean, I think probably one of the primary drivers has been, I think, we have done a little better on the cost side of the new generic wave than we originally anticipated. I think we talked about that maybe a little bit on the last call as well. So when we're building our forecast, we have to estimate the way we think these costs will come out. There were a lot of multi-source generics in this wave, and the cost on those drugs were probably a little better than we initially expected. Edward J. Kelly - Crédit Suisse AG, Research Division: Okay. And we heard from CVS, at their analyst day, their expectation for calendar 2013 being a better profit contribution year from generics than calendar '12 so, I guess, implying sort of like your next 4 quarters better versus the last 4 quarters. I was wondering if you share that view as well. And then what is that telling us about what we've known historically about generics that are on exclusivity versus off exclusivity? And is that changing at all the profitability of the 2? John T. Standley: I think the answer to the last part of the question is probably yes. As far as our view towards the next 4 quarters, the way our fiscal calendar's going to fall, first of all, is a little bit different than theirs. And I think what one of the things it looked like to me that they noted was that a lot of that profitability was probably in the first half of their fiscal year, so when you look at our numbers and our guidance for the fourth quarter, which picks up a chunk of what they're talking about, I think, and if you look at the guidance, we continue to expect to see strong pharmacy gross margin in the fourth quarter based on the guidance we just gave you. Where we're still, I think, working to gain more clarity is we probably need to see how plans line up in January to get some sense of the mix of plans and reimbursement rates. And we're still working pretty hard trying to get more clarity into how we think generic cost will behave next year. So I'd say we're probably not quite where they are in terms of how our fiscal '14 will play out with pharmacy margin, but I'd say the situation is also still developing quite a bit. Edward J. Kelly - Crédit Suisse AG, Research Division: Okay. And you seem to be making good progress on retaining the Walgreens prescriptions. Is it possible to share any more color in terms of how much of those scripts you're retaining, maybe a little bit more color on how you're doing that? And then there's been some talk out there about -- and a competitor of yours suggested this, that maybe as we get through sort of the first quarter of -- first calendar quarter of next year that if Script hasn't left, then it's probably not going to at that point. I was hoping to get some sense from you as to what you think the timing might be on when that bleed of scripts might actually stop and we sort of know where we settle out. John T. Standley: I think that's -- I think probably around the calendar first quarter time frame, we'll have a good sense. There's plan changes that'll occur in January, so there could be some disruption there. We'll have to sort of see how that shakes out. But I think that's probably -- gives you a good sense -- there could be some attrition after that. But I would expect that what's going to happen will have -- most of it will have worked its way through the pipeline by then. In terms of the things that we've done, I mean, we talked about some of the investments we made to make sure we delivered the excellent customer service. Ken, I don't know if you want to talk a little bit about the loyalty card and the programs that you've been working there. Kenneth A. Martindale: Yes, I think this is a good example of where we really can leverage the loyalty program and the communication vehicles that we've developed. And so we're doing a lot of direct communication with all of our customers but especially focused against ESI retention, and so far, it's paid off. They have reacted very strongly. And I think when you couple that with the service improvements that we made at the counter, it seems to be working. Edward J. Kelly - Crédit Suisse AG, Research Division: And John, could you share the percent retention that you think you're at? John T. Standley: We haven't -- we're trying hard not to do that, and as we've said before, what we are doing is, obviously, giving you monthly information to sort of measure our performance. And if you, I think, are kind of watching our script count, it's holding up very nicely. And as Frank said during his comments, we like the way December has started from a script count perspective, so we really feel good about where we are.

Next question comes from the line of Matt Fassler with Goldman Sachs. Stephen V. Tanal - Goldman Sachs Group Inc., Research Division: This is actually Steve Tanal on for Matt Fassler. Some of our questions are similar there, but I guess, just if we can touch on reimbursement just for a second. Just around timing, will most of sort of the resets on the back of some of the most recent generic launches sort of occur in the first quarter? Is that sort of how to think about it? John T. Standley: Well, one thing's for sure. I mean, we get a lot of plan changes in January, regardless of new generics, so January is always an important time from a reimbursement rate perspective. And honestly, sometimes, it doesn't -- it seems to be a little bit of a lag effect in terms of how it shows up in the numbers. Sometimes, it's really February or March before we have full clarity, but January's an important time. As it relates to the generics, we've talked a lot about it, and I don't want to burn too much time on this call. But we have some of our contracts where the drugs are getting adjusted all along the way. There are MAC clauses in our contracts, and so as the costs have come down, the reimbursement rates have come down. We have other contracts that are -- have more of kind of a fixed reimbursement rate that has steps in it over time, and those steps occur throughout the year. So I'm not sure that January specifically, as it relates to generics, new generics will be the exact time a reimbursement rate change occurs there, but there will be many plan changes that go into effect. Stephen V. Tanal - Goldman Sachs Group Inc., Research Division: Got it. That's very helpful. And then just one more quickly on the front end, actually, we -- some discounters and dollar stores made some comments about a very promotional environment, particularly in consumables. Did you guys see that at all in the quarter? Is there anything to note there? Kenneth A. Martindale: I'd say there might be a little more than average, but it's pretty much status quo. I think the way that people are going to market is changing a little bit, but the level of promotional activity, I'd say, is maybe slightly higher but not drastically.

Your next question is from the line of John Heinbockel with Guggenheim Securities. John Heinbockel - Guggenheim Securities, LLC, Research Division: Few things. Do you think -- was this quarter the peak benefit from generics? Recognizing it will continue, but do you think this was the peak? John T. Standley: I think -- I think next quarter, as included in our guidance, is going to be pretty good, too, on the pharmacy gross margin line, so I think we'll see another strong quarter next quarter. And we'll be out with more guidance in the fourth quarter, as we get a little bit more clarity into next year. I mean, it's really a combination of 2 things. Again, we're going to continue to work really hard on the cost side here, but the reimbursement rate situation will develop a little bit. As we get into the fourth quarter, I think we'll have more clarity on that so... John Heinbockel - Guggenheim Securities, LLC, Research Division: Because, John, if you have anywhere close to the same benefit and flu is pretty good, the guidance looks conservative, particularly at the midpoint. And I guess, do you -- are you guarding for something, i.e., cliff, competitive change step up in promotional activity? Have you implicitly built that in, in a significant way or no? John T. Standley: I mean, I think, John, there's nothing implicit like that in the numbers. There's -- we've got assumptions about how much scripts we're going to retain from ESI. We do have a range of assumptions about the way flu will play out. So it's kind of all those things stirred together, but I can't point to one thing that says it's going to get dramatically worse or something. John Heinbockel - Guggenheim Securities, LLC, Research Division: Do you think the ESI benefit in the fourth quarter, do you think that will be -- because, obviously, you started getting the benefit a year ago. We’d always modeled that it would be lower than the fourth quarter last year, that there would, obviously, be some directional giveback. Based on what you're seeing, do you think that or no? Frank G. Vitrano: Well, I mean, we really haven't started to cycle that yet. We'll really start to see the impact, John, in January and February. So we'll have to wait and see. We have baked some of that into the range of the guidance that we have. Not exactly sure what the comp is going to look like. But as I mentioned in my initial comments, month to date in December has continued to be -- we're pretty positive here. John Heinbockel - Guggenheim Securities, LLC, Research Division: All right. Since we've got Ken on the call here, so for Ken, maybe your thoughts on the wellness+ remodel benefit seems to have picked up a bit, say, in the last, I don't know, 6 to 12 months. Why do you think that is? And then do you think the new prototype will be more -- I would hope, would be more accretive to comp than the old one? Kenneth A. Martindale: Yes, I guess there's a number of things, John. I think what you're seeing is we've said that this is going to be an evolution, and I think the stores are getting better. The merchants are getting better in delivering a better product. We're gaining a little bit of traction on the pharmacy side. So I think everything's starting to work together. We put 1,100 Wellness Ambassadors on the street now, and that was a brand-new program for us. And we're getting better at selecting them. We're getting better at training them, and they're getting better at their job. So I think what we're seeing is this thing is starting to mature, and as these stores develop, they continue to gain strength gradually. And so that's what we would expect to see. We're pretty bullish on some of the things that we've done in the new store. There's a lot of testing going on in the new format. But as we keep rolling things out and finding things at work, we'll keep adding them into future stores, and there may even be some of the things that we go back and drop a couple of them into some of the better performing, previously remodeled stores. So we would hope that we would continue to get traction, and this thing will just continue to grow, as we get more of these stores on the street. John Heinbockel - Guggenheim Securities, LLC, Research Division: All right. And then just lastly, Ken, how do you -- the other guys have heard me talk about this before. Getting more recognition of the Gold and Silver benefits, the economic benefits relative to your peers relative to, say, Walmart, how -- is there a kind of a silver bullet way to get that out there and kind of burn it into people's awareness because it would strike me that, that's one of the biggest differentiators you have versus everybody else? Kenneth A. Martindale: Yes. If there was a silver bullet, I would definitely have loaded it. We're still swinging out there. And I agree with you. I think there's opportunity there for us to continue to educate the folks that don't yet understand the program. And the research that we do and also just watching the consumer behavior inside of our stores suggest that once they understand the program, they react. And it does, in fact, change both their front-end shopping habits and also their retention in the pharmacy. So we think that this is -- this continues to be a big opportunity for us. And one of the challenges that we've got downstairs with the marketing team is to continue to drive that message forward, and we're going to continue to do that. And I think we had another wave of advertising that we had out on the street late summer or early fall, and we're going to continue to push that. So I think there's continued upside as we keep pushing down the road.

Your next question is from the line of Carla Casella with JPMorgan. Carla Casella - JP Morgan Chase & Co, Research Division: Just a couple of questions here. One housekeeping item. You mentioned just closing some of the stores that are -- whose leases are coming up, and others you have to take a charge for. Well, how much is your dark store rent currently? Frank G. Vitrano: About -- just about $80 million. Carla Casella - JP Morgan Chase & Co, Research Division: Okay. And then what is your view on the current capital structure? You've got a number of bonds that are coming callable in early 2013 that are pretty high coupon. Are you looking to, off these strong results, come back and maybe refinance some of your high-cost debt? Frank G. Vitrano: I mean, we -- as we've said in the past, we're continuing to look at the capital structure. One item that we're clearly focused on is the Tranche 2 Term Loan that comes due in June of '14, and as we've mentioned, that's something that we're going to look to address here in the first calendar quarter of next year. But we continue to look at the other tranches of debt that are out there, the ones that you're referencing, the first and second lien bonds that are out there, and the issue for us is whether it makes more financial sense to wait until the next call, which would be in the middle of next year, or do something now is really a market condition for -- market condition set of facts for us and something that we continue to monitor. And we'll pull the trigger as appropriate. Obviously, we do have access to the capital markets and can react pretty quickly if the time is right. Carla Casella - JP Morgan Chase & Co, Research Division: Okay, great. And then just on the gross margin front, can you talk a bit about how much of the gross margin improvement came from any change in your positioning in either seasonal or front-end merchandise versus the -- it sounds like most of it came from generics. But I guess I'm just wondering if you could break out any more detail. John T. Standley: Yes, the front-end gross margin was pretty steady for the quarter, consistent with the prior year. So the increase was really driven out of the pharmacy, and it came in 2 places: one, just more script count; and then the big chunk of it came from profitability on new generics.

Your next question comes from the line of Joe Stauff with Susquehanna. Joseph Stauff - Susquehanna Financial Group, LLLP, Research Division: Could you just repeat -- I'm sorry I missed it. Did you frame how much EBITDA contribution came from lag in the current quarter -- and I'm sorry, in this last quarter? Frank G. Vitrano: Yes, we said the benefit, Joe, was -- from ESI was $18 million to -- a range of $18 million to $22 million. Joseph Stauff - Susquehanna Financial Group, LLLP, Research Division: Okay. And so that's pretty consistent with the run rate lease in the first half, correct? Roughly I guess [indiscernible]... Frank G. Vitrano: No, in the second -- that's consistent with what we had in the second quarter. Joseph Stauff - Susquehanna Financial Group, LLLP, Research Division: Okay. Now I guess one thing I wanted to ask is, obviously, a lot of debate about the generic cycle, how profitable it is and so forth versus last time. Can you just comment in general about the profitability of this particular generic cycle? Is it just that the duration gets extended versus what was experienced in the first cycle -- or I'm sorry, in the last cycle? Can you just comment on that? John T. Standley: Well, I think, honestly, a big piece of it is just the sheer quantity. This is a very large bundle of generics coming to market at one time, so I would say that's uniquely different than, I guess, since I've been back here over the last 5 years or 4 years or wherever it's been and even in my prior stint here. So this is a very, very large bubble of generics altogether. So I think that's a big part of the difference in terms of the magnitude of the impact versus timing or any other type of thing. I would also tell you the way we're reimbursed today is a little different than it was maybe the last wave, and so that's spreading around some of the generic profitability a little bit differently. But in terms of magnitude, it really is the quantity that's driving this thing. Joseph Stauff - Susquehanna Financial Group, LLLP, Research Division: Got it. And I guess the expectation in the Street and your turnaround, in particular, probably is that the generic cycle would show significant sort of improvement in profitability on a quarterly basis. So obviously, you significantly beat expectations in this quarter, but the last previous quarters were probably a little disappointing. And I think some of that is loss based on the amount of reinvestment that you're putting back into the business. Obviously, the remodel program is obvious. But your 1,100 Ambassadors, for instance, those are -- run through the P&L. Can you talk about -- I guess, your store base roughly 4,600 -- how much or how many of the stores you have reinvested in over the last maybe 2-plus years and how much you need to do in terms of the number of stores? Maybe that's a better way to frame it. John T. Standley: I mean, just in terms of sheer numbers, Frank, by the end of the year, we're going to have 780… Frank G. Vitrano: About just under 800 stores. John T. Standley: So just under 800, so that's really a 2-year -- it kind of started last year and is hitting its stride this year. I would expect that we're going to invest -- in terms of store count number, I'm not sure of the exact number, but we'll make another good slug of investment next year in store renovations. Our goal, our stated goal is to get to a point where we have every store renovated or new in a 5-year period. Frank G. Vitrano: Yes, 80% of the chain, new or remodeled, in a 5-year period of time. That's kind of the goal that we have to get to. And Joe, part of the issue here is different than our other 2 competitors, okay? We've underinvested in our stores for such a period of time that we're playing catch-up here. And that's part of the investment that, in our judgment, is necessary in order for us to be able to build back our store base. And with regard to the Wellness Ambassadors, we're seeing some pretty good returns out of those incremental dollars. Those are clearly at the net new position that we added to our payroll here. We're getting very positive feedback. We track -- we have the ability to track the performance of these individuals just in terms of how category sales are improving in each of the stores where we do have a Wellness Ambassador, where we don't have a Wellness Ambassador. And we're seeing some progress there. John T. Standley: I guess I'm trying to make sure I get the question, but if your question is, is there a drag in the P&L from some of the investments we're making in the business, the answer to that's yes. We got remerchandising crews. We got Wellness Ambassadors. We have a lot of things going on. But those are the things that any business needs to do to reinvent itself and to move itself forward. So we think they're appropriate investments, and we're going to continue to do it.

Your next question comes from the line of Mark Wiltamuth with Morgan Stanley. Mark Wiltamuth - Morgan Stanley, Research Division: Wanted to ask a little bit about the Walgreens recapture there. When was really the peak of recapturing it, when you caught those Walgreens customers coming in? Was it more like March? Because obviously, everyone didn't switch over right in January. When did you really get to the biggest number on customers coming in? John T. Standley: It started in December with a lot of the TRICARE and a number of things like that, and so we started to see activity in December. It built January, February and probably hit its peak in March. So it accumulated up to there. Mark Wiltamuth - Morgan Stanley, Research Division: And on the retention efforts on holding onto those customers, is that a meaningful expense? And when do you start to lap out of that? John T. Standley: It's not a huge number. Again, it's -- most of it has been -- although we did do some advertising in the first quarter of this fiscal year, we made some investments. We pretty much now are investing on a very direct consumer -- specific consumer basis, so it's not a super material number. It's not huge. Mark Wiltamuth - Morgan Stanley, Research Division: Okay. And then if you look at your generic -- or your gross profit swing here versus year ago, you got 100 million -- $106 million swing versus a year ago, and you had been running kind of $50 million to $70 million swings. I guess the question is, is there going to be a MAC step-down to come here? Is that going to -- that number going to cool? Or do you think we can stay up in that big year-over-year swing number? John T. Standley: I think, again, we've talked a little bit about the fourth quarter. We still see a pretty strong pharmacy gross margin. It's in the range of this. Could it be slightly lower? It might, but that's why we have a little bit of range around the guidance. And as far as next year goes, we're going to give you guidance in the fourth quarter on next year. But we will see reimbursement rate pressure next year, but we also expect to be able to continue to drive some cost out. So we're still working our way through that, honestly. Mark Wiltamuth - Morgan Stanley, Research Division: Okay. And the new fiscal '13 guidance does have the $18 million credit card... John T. Standley: It does. Frank G. Vitrano: It does, Mark.

Your next question comes from the line of Jason DeRise with UBS. Jason DeRise - UBS Investment Bank, Research Division: Jason DeRise at UBS. I wanted to talk a bit more about the initiatives on the wellness store plus wellness+. Is the idea that with the improved profitability, underlying profitability, that you can accelerate your CapEx spend? Or would you rather accelerate your debt paydown? John T. Standley: I mean, I think we're going to be measured in terms of increases in our CapEx. We believe there's good return on the investments that we're making. We also believe we have probably some deferred CapEx that we need to kind of catch up on. But we're going to balance that in a responsible fashion with the issues we need to address with our capital structure. So you're going to see a balanced approach from us with good financial discipline. But hopefully, as we do generate more free cash flow, we will have the opportunity to increase the investments in our business. Jason DeRise - UBS Investment Bank, Research Division: If you're getting now a 300-basis-point uplift, I mean, I guess you would -- eventually, you would pay down your debt anyway, so I guess I was trying to maybe understand that. But within that 300-basis-point uplift you're seeing in trend in those stores, is that mainly because of the way that you incentivize the scripts, and so your scripts growth is really good? Or is it that people are just spending more once they get their discounts on the front of the store? Frank G. Vitrano: Yes, what we're seeing there, Jason, is we're seeing -- that's the improvement on front-end sales. So based upon the new format, some of the new concepts that Ken had referenced earlier, we're seeing an excess of a 300-basis-point improvement in front-end sales from a wellness store versus a non-wellness store. Jason DeRise - UBS Investment Bank, Research Division: Okay. And then when you convert those stores, are you seeing an uptick in wellness+ usage or sign-up? John T. Standley: Well, I think the key there is really the Wellness Ambassador. As we staff these stores with Wellness Ambassadors, they're very helpful in making sure or working with customers to get them enrolled and wellness+, so it definitely helps in that regard. That's really where the difference is. Jason DeRise - UBS Investment Bank, Research Division: But you do have higher household penetration and usage of wellness+ in those remodeled stores? John T. Standley: I'm not sure I know the exact answer to the question, honestly. Jason DeRise - UBS Investment Bank, Research Division: Okay. I guess I was just trying to understand if maybe some of that uplift is because you're doing a better job with -- I mean, it's fine if it is. I'm just trying to understand. It just seems like this would all link in well together. John T. Standley: Right. We've driven strong wellness penetration in all stores, so I'm not sure it's materially different in the wellness stores per se. But the Wellness Ambassadors definitely make a difference between engagement with wellness+, flu shots and other initiatives that we're executing so... Jason DeRise - UBS Investment Bank, Research Division: Okay. And then I guess I just wanted to follow up on one thing on the trend for scripts overall. Obviously, there's the Express Scripts benefit, but then you've also been buying files. So what do you think next -- I know you're not going to give guidance next year. I guess, what do you think this year is the underlying trend of what you're doing with non-Express Scripts customers and without the file buys that you've done? I mean, is it still slightly down? Or is it more flat? Frank G. Vitrano: I would say it's flat to up, and a piece of that is flu shots and just a little bit of organic growth. Jason DeRise - UBS Investment Bank, Research Division: Okay. And -- all right. Do you think that, that is kind of you've turned the corner on that, that's something that you need to build on? Is there anything that you would want to caution people on if starting from that point of underlying is flat to up? John T. Standley: No. I mean, we think -- we feel really good about where we're at. We're -- I think we've done a fabulous job in the pharmacy growing script count. If you go back to the 4 quarters before we really started picking up Express Scripts customers, we were already growing script count combination of, I think, significant improvement in pharmacy service, the impact of the loyalty program. All of those things have helped us. There could be some giveback here. Again, we've cautioned about that. We don't know exactly how the Walgreens retention will play out over time, although we feel good about where we're at right now. So if we have some giveback there, that would be a negative drag probably on our script count. We got to cycle this whole thing. As we get into next fiscal years, we got to work our way through that. But we like the underlying trends. We like the way flu season has started off. We like the demographics. We like healthcare reform. We see a lot of positives out there in the future for our pharmacy business in terms of just sheer script count growth. The battle will be on the reimbursement rate side. Jason DeRise - UBS Investment Bank, Research Division: Right, right. And just I guess, lastly on Express Scripts, I guess, the comment was that you've retained the lion's share, and unfortunately, I don't measure my market share in cats. But does that mean like 80%, 90% retention? Or are we just saying it's better than 50%? John T. Standley: We're saying it's very good retention. Frank G. Vitrano: The vast majority. John T. Standley: And you can take that cat to the bank.

And your last question comes the line of Bryan Hunt with Wells Fargo Securities. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: In all seriousness, looking at the ESI customers, and they've obviously been a nice boost to your script count, can you talk about maybe the differences in their front-end purchases versus your core customer? Because it just seems like you've -- the company's had a very nice bump in script count, but it just hasn't played out in front-end sales. And I was wondering if you could -- I'm sure you've all done statistical work around that, but what have you discovered? John T. Standley: Well, there -- they actually have helped us on the front end. We have a very high penetration rate, and these customers have been no different between front end and pharmacy. Going from the pharmacy towards the front end, probably 90% of our pharmacy customers shop our front end, and that's been consistent with these customers. So there has been an impact on the front end from them. But if you look at just the sheer customer count, our front-end customer count, even though it's 30% of our sales, is 5 -- our front-end customer count is 5 times higher than our pharmacy count. So these customers did not represent a significantly material increase in customer count on the front end. Does that make sense? Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: It does make sense. And then if I were to dissect the remodels versus your untouched stores, your remodels are up 300 basis points. That implies your untouched stores are running down about 50 bps. Is that a fair assessment of the numbers? Frank G. Vitrano: They're positive. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: They're positive as well. Frank G. Vitrano: For the third quarter, yes. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: And on the front end? John T. Standley: Yes. Frank G. Vitrano: Yes. John T. Standley: Yes, yes, yes. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: Okay, very good. And then previous calls, we’ve talked about a 3% same-store sales lift on your wellness remodels, generate about a 20% ROI. Has that math changed at all? John T. Standley: It hasn't. We do need to get more -- what's lagging behind in terms of ROI is the pharmacy. And so what we're starting to see is with the Wellness Ambassadors, with flu shots that the script count and the wellness stores are starting to pick up a little bit versus the rest of the chain, but we still have a ways to go here to get where we need to be in the pharmacy. But honestly, it's not surprising that the pharmacy takes longer to mature than the front end does. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: All right. And then my last question, I don't want you to give away any trade secrets here, but you mentioned your 2 prototype stores are seeing material sales differences from the rest of your wellness remodels. Can you talk about some unique attributes of those stores and maybe the incremental costs associated with those attributes? John T. Standley: Yes. Well, first thing is I think you can go online and see it, right? There's a couple of drugstore -- is it drugstorenews.com? You can go online and actually take a look at a video there that gives you a nice overview of the store. But in terms of the cost, the prototypes are always more expensive, so I don't think we've buttoned down what the actual run rate cost of this thing will be until we get out and engineer those -- that cost a little bit. Ken, do you want to talk about some of the features in the store? Kenneth A. Martindale: Yes. I mean, the first thing that you're going to notice is the interior design is completely different, and so it's quite a bit different feel. It's a much softer, warmer look, and the consumer seems to be reacting very well. So just the atmosphere in the store is quite a bit different. And we're continuing to drive merchandising innovation there. One thing that we're trying right now that's kind of unique is an eye care center where we brought all of the eye care solution, sunglasses, readers, everything together, and it's capped off on an end cap by a kiosk where you can actually order your contact lenses or glasses and have them shipped to your home at a very, very reasonable cost. So it's those kinds of innovations. We've added a nail bar. We've done some different things with the men's grooming section and household chemicals and fragrances. So it's a bunch of different innovations that our merchants are continuing to push forward, and they’re trying a bunch of different things. And so it's not that you're going to walk in and see 20 new merchandising initiatives. There's just -- they continue to step the game up. The other thing they've done is brought a lot of product outside of packages so the consumer can feel them and touch them. And that seems to be going over well. Anything we do interactively, the consumer reacts really, really well to. So I think it's just an ongoing effort to do a nicer job of presenting products in a better way that stimulates the consumer to buy more. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: And my last front-end question, given the fact that you've got increased participation from your wellness members as well as increased penetration from your generics, are -- is it safe to assume that your tonnage on the front end is up more than the same-store sales number or your item count? John T. Standley: I would say it's close. On the front end, the generics are really impacting the pharmacy, so I don't think we're in deflationary environment on the front end. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: I meant to say your private label, not generics. John T. Standley: Oh, I'm sorry. Yes. No, I think it’s still... Kenneth A. Martindale: It's pretty close. Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division: Oh, it's pretty close. Kenneth A. Martindale: Yes. John T. Standley: And I think that concludes everything. So we want to thank everybody for listening in today, and happy holidays to everybody. Thank you.

Thank you. This concludes today's conference call. You may now disconnect.