Aeropostale Earnings Call NUGGETS: Fashion Content, Gross Margin
Adrienne Tennant – Janney Montgomery Scott: Tom my question for you is about the fashion content. That part of the store look great, just doesn’t look like there is enough of it. It comes in, it turned sold out and so I am trying to figure out what proportion of it of the force that was it in spring, what is it now and what should it be and at what point in time, and then really quickly for Marc, can you just give us an AUC update, is it still negative mid to high single digit for the back half of the year?
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Thomas P. Johnson – CEO: We agree with you in terms of the look and feel of the store. We’re very proud of our fashion offering and it is checking as you said. Clearly, the first half of the year as we had commented earlier this year that we bought fashion light and we’ve made a bit bigger bets in the back half of the year and certainly reading or reacting as quickly as we possibly can best-sellers. Matter of fact we has some really great sales in the beginning of the year. We read and reacted to that business. We ordered for the back half of the spring and we did the same thing going into the holiday trading period. So we feel good about that and it’s really an interim process for us. The more we see the appetite of our customers and her response to our fashion, the more confidence that we feel investing into our fashion. So, as we head into the back-end of all and holiday, you will see a bit larger bets placed on our fashion. I’m not going to get into the proportions, but the opportunity for us continues to be growing that fashion quotient. Then on the average unit cost, as you said it is down in the back half, negative mid to high single digits and it’s pretty consistent about across Q3 and Q4.
Betty Chen – Wedbush Morgan Securities: I’ll just also add that fashion really looks great.
Thomas P. Johnson – CEO: Thanks, Betty.
Betty Chen – Wedbush Morgan Securities: I was wondering if we could get a little bit more color around gross margin, SG&A. I know at the start of the year you talked about several different investments that you were looking to make, and certainly we saw some of that marketing continue in the second quarter. Should we continue to expect SG&A growth rate to be similar to the run rate that we saw in the first half in Q3 as well as Q4? And now that we do have AUC coming down mid-to-high singles, how should we think about gross margin, and can we recapture the losses we saw in the second half of last year, or are there some other elements we should keep in mind?
Marc D. Miller – CFO: I’ll take that. Starting with SG&A, as we look to the third quarter, we do expect to see a deleverage that’s probably closer to the Q1 rate than the Q2 rate. Q2 should be the high watermark in terms of deleverage year-over-year and we would expect to see a slight improvement versus that deleverage rate in Q4 versus Q3. It’s related to the planned investments that you alluded to. Marking is a big component of it. You all have seen Chloe and her position as our brand ambassador in our stores and the investment that accompanies that. There have been systems investments as well in mobile POS, in PLM and other upgrades. So those are planned investments and fixed investments that will continue through the year. One other piece which I should mention is the e-commerce growth which is worth about 30 bps of deleverage in Q2 and we expect that to continue into Q3 and Q4. Moving on to gross margin, in Q2 we did see virtually the entire what turned out to be cost decrease in Q2 being passed along and into our gross margins, which is primarily what is responsible for our gross margin increase year-over-year. As we look to Q3 and Q4 we do expect to see continued gross margin expansion from that reduction in costs; however, we would note that our core product classifications remain under pressure, it’s very promotional out there and so some of the gains that we may see from average unit cost decreases maybe offset by that AUR pressure on our core products.