We are the management of AutoZone. My name is Brian Campbell. I'm investor relations and treasury and tax work, and to my right is Bill Giles, our Chief Financial Officer, and to my left is Michael Lasser. Go ahead.
You introduced yourself as the infamous.
Yeah
of investor relations for AutoZone, and Bill Giles has been the CFO since 2006. He started when he was four years old.
Appreciate that.
We are very thrilled to have these gentlemen with us today. It's been a very interesting time in the aftermarket. After seeing steady, stable conditions for quite some time, the aftermarket's been a little more volatile. Looking out, and what we've seen thus far is it's been a more normal winter than we've seen in the last few years. Do you think there's been enough cooperative weather conditions to really drive the industry for the next several quarters and put to rest some of the concern that maybe it's not the weather, it's some other factor that's maybe weighing on the industry?
Yeah, I think so. I think if you go back and look at it over time, you would recognize that we have talked a lot about this, two mild winters in a row, and that culminated with what is our FY 2017. Our fiscal year is August to September, just to clarify that. That 2017 was a little bit of a softer year, and I think that was the culmination of having a soft winter. Clearly for all of you who live in the Northeast area, we've had a very harsh winter here, and that's helpful for us.
Yes, I do believe that that positions us well, not only for the quarter for which we just completed, which we feel really good about the performance of that quarter, but also for an extended period of time, because it does seem to have a bit of a tail to it. We had strong performance, particularly in failure-related parts, during that time period. I think our maintenance business was probably a little bit more flattish. That's good because that's when our failure-related parts should be strong, and our maintenance will come after that. As you mentioned before, you've got a lot of roads and things that are all torn up, et cetera, that it's just going to permeate itself into more undercar, more brakes, rotors, those kinds of things, that'll drive some of that demand.
That'll work out well for us as we proceed over the next couple of quarters.
One of the areas of question coming out of the conference call from last week was, your partner, Bill Rhodes, made a statement that when there's a big blast of winter, you get an initial wave of demand, and then each subsequent blast of winter doesn't drive as much. Maybe you can just elaborate on that?
Sure.
I think it confused some people in the marketplace who say, "Hey, when it's cold, it's cold.
Right.
Maybe you can give us a few words on that.
You know what's helpful is that, and we see this just as any quarter progresses, if it's super cold for two days or so, that doesn't help all that much. It helps a little bit. When you've got 30 some odd days of extremely cold temperature like we experienced here, that's really when you get the benefit of that. Once that transpires, and then you get back into that choppy period where it's warm and then it's a little cold, et cetera, or it's just incredibly rainy, that isn't really necessarily helpful. We've kind of moved past the failure-related parts at that point, and now we're moving into the maintenance categories. If it's just a deluge of rain like we had the last few weeks, first few weeks of February, it's just not going to be helpful.
Nobody's going to get under their car during that time period.
There's a perception in the marketplace that trends in the aftermarket are more volatile today than they've been in the past. What's your perspective? Is that just there's a recency bias and people are thinking because there's a real short-term focus on day-to-day trends, or has it always been kind of volatile for you?
That's my advice. It's actually been pretty consistent. Mike's first question, he said was, "Hey, investors want more performance, better results due to weather right now." We're a pretty consistent metric. I think we try to talk about the same-store sales performance in a pretty tight band. That has really sort of been the story. We talk about anywhere from a 0%-3% range, a very steady business model. I do agree with you, Michael, the introduction of macro points, gas prices, weather, all benefit and have short-term impetus and impacts. Over the long run, it's pretty steady.
Yeah. One of the factors that have been absent from the aftermarket for the last few years has been inflation.
After seeing maybe a point or two of pricing contribution for some time, are you seeing any signs that inflation is starting to come back? Do you think the aftermarket has the ability to pass through pricing in light of all the price transparency, et cetera?
That's a good question. You're right. We've had very little inflation over the last few years, and that's not been helpful from a sales perspective because you're right, historically, and we certainly believe as we look out into the future that there will be an ability to pass price inflation onto consumers. It has happened fairly consistently over time, and there's no reason to believe that that won't continue as we move forward. At the same time, we've seen a little bit of inflation, commodity-based mostly. We don't have visibility on an increase in inflation. We can only maybe look out five to six months or so. We don't necessarily see it coming per se, but there's an inherent belief that we will definitely have inflation at some point in time. Obviously, interest rates are rising. There's going to be more increases to input costs overall.
As a result of that, we do believe that there will be some inflation in the marketplace at some point in time, and we do believe that that'll be helpful both from a sales perspective and at some level, a margin perspective.
It's early in these discussions, but obviously tariffs are front of mind for a lot of folks in light of what's happening. How do you see that impacting the aftermarket? Maybe you can give us some sense of steel and aluminum and what percentage of raw materials that might comprise the product portfolio at this point.
Yeah. I think on the hard parts side of the business, there's a good element of steel that is located in many of those core products on the hard parts side. We're in the same boat that you're in a little bit, is that it's new. We're taking a look at it to see what the impact will be. Somebody else had asked me that same question a few minutes ago, it's really hard for us to predict what'll happen or how that will impact the industry overall. Obviously, if it does, there will be some level of inflation across the board for everyone. It won't be, certainly not a some specific issue. It'll just be an element of the inflation, I think, at some point in time.
I was going to add one comment that Bill had asked about with the merchandise part. When this came out, he had called a meeting, we sat down, we talked about it, the first comment from the merchandise department was, "We believe this is rolled steel versus finished goods." These are not terms you guys would live with and hear every day, but rolled steel is just the giant tubes, and that is initially the last time there were tariffs on the rolled steel. We're buying, as a company, finished goods. In answering the question on inflation, if we go with the past, it doesn't affect us, but we'll have to understand that going forward. I just want to let you know that it's more about the raw material versus the finished good.
It's more about the raw material, wouldn't the raw material eventually find its way to the finished good?
The tariff wouldn't be on the finished good per se. It would be on the raw material, we believe.
Yeah.
We don't know the details.
We have to understand it. It's something.
Maybe the point is that you guys are already doing some contingency planning or at least having the conversation to say, "What would we do? How would we approach this in the event that this does happen?
We are. It's so fresh, we don't have an answer for you. Yes, there's discussions going on and so on, both that and APRA.
Yeah.
What lessons can you use from if we roll back the clock a year ago when we were talking about the border adjustment tax? It was probably a similar type of situation where you had to at least start to have the conversation. Were you planning on taking any actions at that point that you could now apply now?
I think, to be honest with you, on those and probably on this as well, it would be reactionary.
Yeah.
We would have to see how it applies to the marketplace, what the manufacturers are doing, how they respond to it, how can we help them respond to it. From our perspective, we wouldn't lead it. We'll end up being reactionary since we're really buying, as Brian said, the finished good at the end of the day.
Set the record straight, because there is a lot of debate about the ability to pass along price increases in light of Amazon charging lower prices online for similar goods. Help shed some light on why there would actually be an ability to pass along some of these price increases.
Yeah. I think part of it is ultimately it's going to be whatever the market is bearing or whatever your competitors are doing as well. Historically, as we have had price increases, we've been able to pass those on because obviously it's based on the cost of goods sold. Look, there will be a gap in prices between us and online only because there's a totally different value proposition that's taking place inside the store.
The experience that you receive when you come into an AutoZone store, allowing someone to do a check engine light, to utilize our Fix Finder program in order for us to figure out exactly what the issue is and why that light is on, what the repair could be, whether we have the product or not, whether you're capable of doing it or not, or whether you'd prefer it for us to refer you to one of our commercial garage customers that we have and be able to solve it from that way, or whether you have a battery issue and you want somebody to come in and test the electrical system for you, the battery, starter, alternators. We always will say, we are more than happy to sell you a $2 cable than $100 battery when that's not your issue. The issue is the cable.
There's a lot of things that can transpire on that. If you're buying wiper blades, our ability to put those wiper blades on for you. There's all sorts of things that take place when you come into a store that create a slightly different value proposition.
We got a question about China, because it sounds like it might not only be on particular raw materials, but it could be the source of the product. How much exposure, what percentage of your products are sourced from China? There was some debate on where the China office is, actually.
I guess
No problem. You're welcome.
Right now, we're all impacted. Like it or not, in the U.S., a lot of the goods that we sell are not manufactured here. In answering the question about imports and tariffs and duties, guys, it's not easy to move business back home. I'll probably let the politicians, I think, for us to answer that over how we deal with it, but we'll all be in the same boat, having to deal with paying for and dealing with higher costs.
What would you say, a quarter of what you sell, 50% of what you sell?
Somewhere between those two numbers, I would say, is probably a fair amount. As Brian mentioned before, we do have an office in Shanghai, and I think as you look through gross margin opportunities, there's opportunities for us to continue to lower acquisition costs by being able to seek out different places for us to get our Duralast product manufactured in different areas and create competition, healthy competition. As that office continues to grow, as we continue to grow our direct imports business, there's real opportunity for us to lower our acquisition costs. That percentage is probably in a pretty good ballpark, and it may grow.
Give us a sense of the pricing architecture at AutoZone, because more than 50% of the sales do come from Duralast, and you have complete and total control over the pricing there. That also influences and provides an umbrella for how you would go to market on other more branded goods. You want to have some distance between your private label and the branded goods. Does that influence your ability to lower prices on some of the branded goods? Because there has been more talk about using analytics to be sharper on price on maybe those goods that are more elastic and a little less sharp on price than those goods that are more inelastic.
Yeah, that's a good question. I think one of the things that we do find over time is that there is a healthy amount of inelasticity on our product. Particularly on the hard part side of the business. Much of it is all about, what wins in the business is your ability to say yes, that you have the product, both on DIY and on commercial. That's where you'll see us make most of our investments, is increasing the amount of inventory availability in the marketplace between hubs, mega hubs, and being able to say yes on a more frequent basis. Relative to the price gaps, et cetera, we don't have a lot of categories where we've got Duralast competing with a branded product, per se.
Typically, the branded product is in a category that maybe it's well deserved there and it stays there, et cetera. In many cases, we really just either have Valucraft Duralast or Duralast Gold. We also try to manage the amount of choice that we're providing as well, because it's a very SKU-intensive business, and this is a capital-intensive business. Our turn is at a 1.3. This is about making sure that you've got the right assortment, that you've got the right level of coverage, where appropriate choice.
Yeah.
Where if you err, you err on the side of being able to say yes.
Are you seeing elasticities change at all? Maybe oil and some of the lubricants have been more elastic in the past. Is that extending to any other categories or not really?
I would say, to be honest with you, what we're finding is that in some cases, oil and some of these chemicals are not as elastic as we might intuitively believe. Time will tell as that continues to migrate its way through. The quick answer is no, we don't see it migrating to other categories necessarily.
Yeah. Switching, well, straight up, I guess the question has been, what other ways do you see Amazon impacting the business aside from price? Do you think Amazon's taking share from AutoZone?
We don't see it necessarily, and the numbers don't indicate that that is the case by any means. We continue to take market share. We continue to be very competitive, and we don't see it impacting our sales. I always say very consistently, we don't believe we're immune to online retailers by any stretch of the imagination. We believe that we have an assortment of coverage and a value proposition that does differentiate ourselves on a long-term basis, and we're not seeing the impact necessarily from online-only retailers and those things. Certain categories like performance and accessories, those could be good categories online because they're very SKU-intensive, they can be very customizable, et cetera. We're just not heavily penetrated in those for that reason.
Yeah. Switching gears to the commercial business. AutoZone's taken a lot of action, put a lot of tests in place. It recently announced that you're going to be increasing the frequency of delivery to three more times per week to 25% of your stores. Why is that the right mix? How do you see that influencing your ability to take share within the commercial side of the market? Because AutoZone's got a very interesting model where you've got this margin-rich DIY business that makes a lot of money that you can then use to fund the growth in arguably what will be a faster-growing side of the industry.
That's right. I think, let me back up a little bit on a point of clarification relative to more frequent delivery. That's one of those tests and programs that we've had in place for a while that just recently we kind of concluded where we were going to be on that. That was really about delivering from the distribution centers to the satellite stores or the retail stores on a more frequent basis. You may have heard us talk about this in the past, where we typically do it once a week. We started testing two times, three times, maybe even four times. At the end of all that, what we really concluded was that three times a week was the appropriate number of times to deliver to the retail store, but only for 25% of the chain, representing about 40% of our sales.
We already were delivering three times a week to a very vast majority of those. We were doing three times a week to some stores that were lower volume, and those were the economic drivers for us. We believe that the returns that we were going to get on the higher volume stores was what was going to be able to pay for that program to continue forward. On the lower volume stores, it just didn't mathematically work economically. Going forward, we're going to do it on 25%, but many of those were already getting that. Now we're just kind of rebalancing and retweaking it. We were somewhat there. We don't expect to have much of an increase in cost on that going forward.
On the commercial side of the business, another good one to clarify is that the more frequent delivery impacts DIY as much as it does commercial, because it's all about being better in stock on those 25,000 SKUs that we're carrying in the retail store. It isn't about commercial or retail, it's about both businesses, it benefits both sides of the business, per se. Does that help answer?
That does. There's been some debate about the influence of the car park, the lower cohorts of vehicles flowing through the sweet spot.
Yep.
Arguably, it's potentially having more of an impact on the DIFM side. You wouldn't necessarily see it in your numbers because you've been growing faster than the sector. People slice and dice these numbers in a lot of different ways. What's your personal view on how that has had an impact on the industry and when it's gonna be less of an issue?
I think going forward, it'll be From our vantage point, a little bit of a tailwind because, to be intellectually honest, we said it was a little bit of a headwind going into it. We had never seen it as being a huge impact on that front end as that was kind of moving its way through the bell curve, we don't see it being a significant impact as it passes through. The reason is that there's 260 million registered vehicles. That number didn't change. In that sense, what happened was that as you have these six, seven, eight year, 10-year-old cars moving their way through, there was a little bit of a dip to it, the reality of it is you still have the same number of vehicles. All you've done is you've extended out the age of many of the vehicles.
You're still selling parts on 260 million vehicles. You're just selling a little bit less in this one segment of the category that might have a slightly higher per unit price to it, but not significant.
Okay. Speaking of the split between DIFM and DIY, last year, one of the factors that weighed probably more on the DIY side of the business was the delay in the tax refund distribution.
Yes.
This year, it's down slightly, maybe a point and a half.
Yeah.
Is that enough to matter?
Probably not. I think the biggest change last year was the shift. There was a huge amount of money that was shifted out two or three weeks relative to that tax refund money going into the U.S. economy. This year, it's virtually the same timing to your point. It sits within 1% or so. There is no difference. One of the things that was interesting last year was that we didn't see a big impact when the tax money came into the economy in a manner similar to what we had seen in years past. This year, it's too early to tell whether we will get a pop when the money comes into the economy. If we do, that'll be great, and that'll be a bit of a tailwind. If we don't, it'll be the same as last year. There won't be any difference.
We'll just be competing against-
[inaudible ] theory on why you didn't see a benefit?
I don't know. I don't know whether or not. Certainly, it was a mild winter. The weather was better. I don't know whether or not people migrated to outdoor home improvement type of things that they might have wanted to do. We don't have anything empirical to say about that's what was our theory.
Got it. There's a question, have you studied Amazon's distribution network? How does it compare to yours? What happens when they're able to serve 90% of the population within one day? Probably as part of that, it's a good opportunity to discuss the hub network, how that compares to what O'Reilly does with larger distribution centers, Advanced does with a whole potpourri of different distribution models.
Distribution. The question is really around distribution. How quickly can you get a product to a customer, either from the customer coming to you and picking it up at a store or you delivering it to the home? You could interchange, Michael did Amazon with the competition. It'll continue to evolve. We utilize 10 domestic distribution centers for our 5,500 stores. We also have 188, a large number, of hub stores and a subset of those with something called mega hub stores. What you're going to continue to hear ourselves talk about is how can we push our assortment, going to be as close as possible. The Amazon model has been in two days, be near an airport, for example. With us, we're trying to use our stores in each metro market to supply that.
We do not deliver retail to home, we have capabilities to deliver to all of our commercial accounts. We sort of are one of these industries that have had that last mile built in. The question is, how do you do it cheaply and not lose money? All of the retailers are willing to talk about, "We'll spend." We're very ROIC-focused. We're always trying to figure out a way to get the customer the product as fast as possible, but not be egregious with our expense structure. It's just a balancing act.
Speaking of balancing act, one of the areas of focus coming out of this most recent quarter was some of the commentary around 60 to 90 basis points of investment. I think part of that message you said, "We're going to balance it. We're going to do it over a 12 to 24-month period." A, can you give us a sense for how you're going to deploy those investments, where they're going to go? B, you've invested in the past and sized investments only to have those investments be offset by other factors in the business to keep your profitability stable. Should we think about this as a similar type of situation?
Yeah, I think this is a little unique from the standpoint that there's no question that we're picking up about $200 million that we wouldn't have otherwise picked up maybe three months ago from lowering the tax rate from, like, say, 35 to 24. 11% on $2 billion is how we get to that number. From our vantage point, as we look at it as a unique event, it's an opportunity for us to go back and invest a portion of that investment, less than 50% of that investment, back into the business. The areas for which we believe that we want to do that are in the somewhat order wages, benefits, and technology. From a wage perspective, we've had pressure in the past, but we've definitely seen a lot of activity from wages going up on a market-by-market basis.
It isn't a blanketed number across the country. I suspect that as much as we've tried to make adjustments, we're off on several markets relative to what our median is Well, versus what we're paying our folks. It's an opportunity for us to get more right with the market. We're not necessarily going to lead in that. We're also very conscious of the fact that other competitors or other people within retail in general that are competing for the same labor pool are saying the exact same thing. It's clear to us that others are going to be investing in wages over time. We don't live in a vacuum. We have to respond to the market conditions for which we compete in. Therefore, we will respond to that in kind. That's how we're looking at it.
Now, from a wage perspective, it's easier to execute that over a shorter period of time than, say, for example, some of the technology investments, that that would be the longer 12-plus month impact. Relative to wages, that's something that probably could be impacted over a six-month time period or so. I don't want to set us up that we'll offset that. Obviously, we wouldn't do any of this if we didn't think it was better for our business on a long-term basis and drive sales on a long-term basis. We're still going to generate more income because we're investing less than 50% of what we're going to generate from the net income perspective. It's a unique opportunity, and we want to take advantage of it. Will the tax rate stay at this rate forever?
I hope so, it's not law, it'll only be for a short period of time.
Well, in speaking of a longer-term view in nature, we are seeing more signs that wage inflation is here to stay. Target yesterday talked about $12. That's on the heels of Walmart going to eleven not too long ago. Maybe 15 will become the new norm. Is it your expectation that this is a multi-year cycle of wage pressure, wage investment? Are there elements of the business that you can pull back on to offset some of this pressure?
Yeah, I think on a short-term basis, it will wind up being a bit of a step function change, and then there may be some continuation of that over time. There's always things that we can do, but we also want to make sure that we're delivering that customer service, those experiences inside the store that do differentiate yourself from everybody else. We want to be able to continue to invest in that. The other is, and we don't see it yet today, but it's interesting to note that much of the wage increases that are occurring are typically at the lower income levels, which also happen to tune in with our core customer. Over time, we would think that this would create a healthier customer for us, one with more discretionary income than they have today.
Whether that translates to sales or not, we'll see, but it certainly would put our customer base in a better position.
You made an interesting comment that your earnings will go up because the tax rate's coming down, so all else being equal, it should be helpful. Now, with that being said, a critical part of your economic model is maintaining a constant leverage ratio.
Yes
on an EBITDA basis.
Yep.
In that, you don't necessarily get benefit for your lower tax rate. How does that play into the fact that you've been a very consistent deployer of excess capital back to shareholders by purchasing your stock? Would you consider taking that leverage ratio up because you may not be getting credit for a lower tax rate within that leverage ratio?
I'm sure there's lots of fixed income investors here that love that question.
We're trying to keep it interesting, Brian.
Keeping them nervous.
Yeah. On that one. The model that we apply, guys, is the free cash. If we're able to generate more free cash because taxes are lower, we'll continue to run our model. We're going to invest in existing stores, new stores, and deploy the remaining cash to buy back. We still like that. We do, in fairness, have to balance fixed income demands and to say, "Hey, it's important for us. We'd like to be investment grade," especially in a rising rate environment. It's a balancing act. Historically, basically to cut to the chase, can you lever it further? Can you change your metric further? We have to ask ourselves those metrics and those same questions, guys. We can't do it. We want to keep the rating. It's too important for us, especially in a rising environment. We have to balance all that.
There's more to come on that, at this point, we'll continue to run what we run.
How do rising rates impact the business?
We have debt, obviously every year we've laddered out the debt accordingly. As debt expires and we replace it with new terms, we have to make sure that the interest reality is it costs us more. We watch the environment very, very closely. So far, we're very fortunate from a tax law perspective, there wasn't as much change. If you know what I'm talking about, the deductibility of interest will not affect us negatively per se. I would say that the interest has been in a tight band. We hope to continue to land that and balance that with our earnings and not have that as lead story number one with AutoZone.
What about as it relates to your vendor financing program? Will rising rates have an impact on your ability to finance your receivables for your-
I would say it wouldn't have an impact. We don't believe it'll have an impact at all. I think there'll be availability of credit for our vendors to be able to pursue that. There's no question that that will increase their cost if rates go up. We view it as an input cost, it is no different than any other input cost, they'll have to manage their way through that.
Bill, we've gotten some questions on some of the longer-term issues in the industry. Has there been, in your view, a mix to Within the commercial side to the dealers, are they taking share? How are you positioned for that, is it different now than in the past? I'll follow up with a couple other longer-term ones.
Yeah, we don't see that necessarily. We don't see dealers necessarily taking market share from selling auto parts into the marketplace.
Servicing cars.
We do sell product to some dealers as well, so those dealers can be a customer of ours as well, particularly if they're working on used cars or older cars or possibly off-branded cars.
Yeah.
It also is a unique opportunity for them to be able to offer their customer with a lower option from a pricing perspective. We don't see that as an impact necessarily. In fact, we've got some great programs for the dealers today where we're selling product. What was the second part to that question?
Is it different in the past?
I don't think so. Certainly not over the last two or three years, I would say. It hasn't really changed dramatically. If anything, we're growing that business from a vertical perspective.
We court aggressively the commercial accounts, the dealerships. They're a big customer of ours and a potential customer.
As far as longer-run risks, there's talk of electric vehicles, telematics. Maybe you can describe.
Sure
what that means and why it could have an impact in the industry, and then I'll have a follow-up.
Yeah. On electrical vehicles, we just think of it as, it's such a small piece of the population today, and even though it will continue to increase in sales, there's 260 million vehicles registered in the U.S. today. It will take an enormous amount to change that car park. Whatever does happen, we'll have a long line of sight in order to be able to respond and react to that as it moves forward. Certainly over the very near to mid-term, we see very little impact whatsoever to that. On the telematics side, telematics is really about extracting information off of the car, and being able to diagnose.
For example, when you have a check engine light on today, you can come into AutoZone and we will put an onboard device underneath your dashboard and extract that information off of the sensors in the car. From there, within reason, be able to tell you what the issue is with the car and what needs to be done and how to fix it, and then either sell you the parts or refer you to one of our commercial customers. Other aspects of telematics is being able to extract that information from the car remotely and be able to determine when you need maintenance, when you need et cetera. We've looked at a lot of these things. There's a lot of programs in place. There's ways for us to be able to interact.
It has not resonated with the consumer today for them to be able to tie into that information, and be able to monetize it. I think that's been the biggest challenge is we haven't seen any good way to monetize that data today, from a consumer's perspective, being that the consumer's not willing to pay to be able to get their information.
This may not be an easy question. We want to make it a little fun for you.
It's all on you.
Get them up here. If you had to rank between telematics, electrics, and Amazon in terms of risks to the business-
Okay
Over the next three to five years, how would you prioritize those three ranks?
I think, well, I'll address them individually. I won't rank them necessarily. I think telematics is an interesting one from the standpoint that the OEs need to be able to have that open. I think if people felt as though they had a closed-loop system on their car, that they wouldn't be happy about that relative to the fact that that would constrain them to only their OE dealership. That would be one that I think is more of a social issue on a longer-term basis, to have an open platform to ensure that everybody has the ability to extract that information. Electronic vehicles, let's throw in autonomous vehicles with-
Yeah
the same time. I think that long term, 30, 40 years from now, those may have a bigger impact. Ride sharing, let's put all of those into one group, electric vehicles, autonomous vehicles, ride sharing. Does that create a different environment for how we transport ourselves around? That may have a bigger impact on a 30 to 50-year basis. Amazon, look, Amazon's going to be a strong competitor. They're obviously growing in all spaces. All competitors make you better.
We see it as some impact. We're just not seeing the impact today. We're going to continue to focus on the things that we do really well to differentiate ourselves from a consumer's perspective and make sure we're executing those really well. When I think about the tax reform stuff, wages, we want great people. Technology, we want to improve the productivity of our people.
Okay. We are off. Thank you very much. Please join me in thanking the team from AutoZone for a very interesting-