There observations our the and on that key quarterly I'd into to share to results. build call. diving Hal's before are on Thank the you, that X like business comments Hal hello everyone about
our favor that businesses dry markets goes clearly the works of favorable where works a as against volatility late been to us. all like XXXX Texahoma From for over First, looking and years unfavorable at have January, of a in down be Midwest, both markets related to start and weather, certainly materialized and will No year where weather. seasonal over it to major our business. hot as weather unfavorable the weather are the spring impact summer warm There to others be doubt, to the transparent pressure our some tried from and under to the a across We've years our events. most year. the never a impact
be continues Second, our execution to strong.
are performing top Out our positively and Garden Centers, and Fusion initiatives Project digital line impacting Life Club, all are Our growth. well Neighbor's Here driving pet are and results. initiatives
to spending challenges unique retail Third, customers' current environment. to the the be macro softness we view the in our in
and navigate agile We Our current positive initiatives engagement to driving growth long-term is as customer our investing will the strong environment. but we are for results. be remain we committed
continuing our We are our track record committed value of to creation long-term shareholders. for
quarter Now third turning to results. our
the can control. While we our the expectations, well, sales trends below what team environment were our controlling managed
in also Out being our the We supplier remain steadfast commitment Life dependable Here. for to
top growth, quarter consistent offset third weak the under seasonal by by below-trend early results of summer Q and line Our remained were seasonal discretionary a big-ticket lack driven sales, strong and sales demand on fall and pressure. performance
on Comparable year-round and The such as for solid transactions by and growth pressure Northern drought sales to reduced consumer were quarter demand and Far as in start our as West. demand of warm Our added in with Texahoma being the for well markets. pressure store in core the flat comparable incremental categories offset these growth heat by categories. was geo regions the the trends fall the seasonal offset the regions our in the Midwest, was Southeast where performance
had average in a ticket. We comp decline modest the
growth unit up to softness ticket seasonal average which benefit unit was the by ticket. retail and the run average The Our offset retail X%. categories, average in declines X% in at of a big was our in higher
discretionary extent, pressure but in and average add-on softer per the to we experience a continue items, sales Additionally, lesser putting units impulse on transaction. to
statement. income our down Moving
strong XXX $X.XX strategy. third year's Gross prior from to XX.X% product X.X% for in quarter ongoing margin basis the margin increased we continue billion. profit and XX.X% as everyday the Gross our price gross low a was execution Our points maintain increased to to of highlight margin quarter.
environment membership has to Club when robust and the great overall picked value. modestly, across At promotional our offers up retail a large of us way Neighbor's a provide time
our with together propositions us, allows program value our loyalty target Our to customers. strategically vendors, for
margins in given margin attributable Ohio. ticket somewhat our and improvement mix transportation gross margin Product from improvements lower driven This big rate gross sales, which by center gross in was primarily increase pressured the margin The a lower to was global the supply by carried rate. lower distribution efficiencies Q. new costs strength from chain in the offset
percent XX.X%. amortization, and as a and general in in attributable to to basis DC, percent and some new comparable of included store XX selling, higher our cost The depreciation our As amortization of increased was increase SG&A leverage sales expenses, planned growth and of lost our net net administrative sales, the including a primarily points depreciation the decline investments, which fixed due along onboarding sales. with to
consistent last claims SG&A. in with medical to increase Additionally, higher contributed also quarter, the
to We benefits XXXX. anticipate so. our this a We have to and made don't be to headwind do adjustments will continue program in
costs. the by of we benefiting basis approximately the During points planned Tractor leaseback SG&A completed transaction XX net sale quarter, repair locations, of XX store and Supply
expense approximately offset was onetime This in terms is benefit the better the basis lease by SG&A assets investments. attributed XX benefit for economic to pretax. depreciation of useful of million remodeled to $XX to in certain stores increase a these profile a due the to Additionally, lives of of change reassessment a or points partially represent
on our core overall, mention didn't I I our did great cost to performance. reflect be scaling remiss that the if team variable SG&A I a our job As would operations sales performance
teams scale achieved teams of best-in-class balancing fill center productivity back driving measures scores. our in cut the right maintaining satisfaction and support the distribution rates did while Our overall store some our level store customer best of to years, customer payroll job great and also a times, and
our scaled the team and this execution costs variable in well strong core environment. had Overall,
As what control. growth an XX% controlling our growth SG&A year-over-year strategic nearly represents further goes core investments we appreciation dollar to illustrate, our out to example, My in team of initiatives. could for the
operating was margin XX%, year. quarter, basis the For point the a XX prior from profit improvement
the year our to prior flat per end at the inventories sheet. balance basis. on third $X.X Merchandise now a to billion store quarter, Turning of were the
pleased of We it with the are and continue closely quality managing and position be inventory. to very our
are Our years. X been the over they've in-stock best in rates
In addition, balance maintain a around cash strong continue annualized of sheet our ratio With to inventory shrink leverage year-over-year. improved we flows, with a Xx. healthy
attractive has is at debt no fixed and maturities nearing long-term rates. Our very
Now XXXX outlook. updated turn our let fiscal to financial me
$XX.X anticipate net billion billion now $XX.X year. in sales store we year, the For with of to even and sales last the range comp
with this $XX.XX. is the $X.XX billion. This income net range for Our be of our of full year margin to billion operating $XX rate remaining XX.X% to to XX.X% includes be $X.X is expected to to of after-tax in a EPS sale-leaseback about forecast net year. QX transactions Diluted benefit $X.XX in
of capital own from higher combined relatively through capital continue We about funded sale stores. program. last will forecast $XXX the This for the that to select fee or of million the offset the for growth $XXX our expected proceeds to estate million note range sale million transactions to year real to the fixed are expected shared existing that outlay for in the under strategy to move to quarter. that million anticipated $XXX needs the new we level the development net reflects to $XXX to expenditures capital important of owned cash our The incremental are be position. neutral be It's our store the of stores development
in be mid-single is quarter to for store down comp Implied low fourth digits. to our sales outlook
the year-round side the of demand for and our on to weather to anticipate the seasonal cycling performance. as discerning storm, on core the comps. winter El continue strength Hal year's will in compares points basis pattern consumer last XXX ongoing We combined Nino categories, with unfavorable which we As and continued relating continued yet our drove top impact we limit anticipate monumental softness spending mentioned, experienced discretionary of favorable in
which the contributing sales of we $XXX extra an line year, a also million week share. approximately sales the of week, are As reminder, lapping XXrd in and included earnings per diluted prior top $X.XX to
retail plans price for As moderation a continued our inflation. increases, of reflect
be will believe modest. While we still it positive,
continued deleverage margin transportation investments fourth expansion gross declines. our some center sales from new distribution reflects comparable benefit an We product our guidance continued we unfavorable given the anticipate pressure mix. expect the store with expected Our SG&A and ongoing quarter, along year-over-year. In and from
our purposes, stores shared is based our XXXX point-of-sale Orscheln of of in last will calculation quarter, for stores converted Most year. our on to comp during As point we store into when sale modeling the converted the go system. QX QX and to this
we number there quarter as As outlook takes is are puts guidance will call. be at customary, to for provide our XXXX for our We're still and a fourth of finalizing sales our considered. earnings
a a the with start business we're demand-driven of with Let's that comps. history fact long positive needs-based,
have XXXX hopefully on the uncertainty less challenging big softness. of this into and consumer was today, but a expect see And anticipate from to do that XX budgets. it and we're pressure operating we continue ticket we than benefit cannot months be weather we'll household will higher-than-normal worse cycling as confidence environment the year, we Additionally, inflation, ongoing but be with degree
our XXXX couple level. always As invest priorities our peak XXXX we depreciation With spending year's excited about we've prudently with strategy .
We strategic progress backdrop, initiatives. to would be last plan investment a Life relieve will Here on the very the pleased our remain of are some years, next we've planned as and net with XXXs, over in the in our in that capital Out shared that which expense. capital
we own our the XX development locations. about gross SG&A stores to ramps in XX of second Tractor Supply this tenth new XX margin open to we opening center store executing store the Our existing quarter. the year, lack benefits opening Similar XXXX, approximately facility anticipate and XXXX. the fund will And XX opening new center gross Petsense as but Much typically program. quarter pressure distribution this by anticipate like our benefits margin to new will XXXX of The transaction during distribution DC the X up. sale-leaseback
adapted Over support of product offerings be have a needs-based, our the to we characteristics our ability The operating our winner around us. retail. demand-driven history, continue to in continually environment to
offense. We agile will and remain play
all We served in and competencies investing us Out will well, have core that growth our our strengthening capabilities leverage our while Here Life strategy.
Now the up. this Hal call I wrap over turn to to will
