Carl Ford: So I’m going to take that, as we think about ad backs we actually pride ourselves on the simplicity of our P&L. So stock-based comp is the one and for the last three years, there’s been a small ad back for early extinguishment on debt, which we think is the right thing to do for our business. We’re not going to we disclose to you in the 10-K what pre-opening store costs are, but the SEC frowns upon a lot of ad backs. And so, we’re really vanilla, because our business just makes sense without the ad backs. If you think about the guidance for next year from an adjusted EBIT standpoint at the midpoint, it’s about a negative 70 basis point decline. At the pre-tax income standpoint, it’s about negative 60 basis points to FY ’23.
And net income is about 50 basis points of degradation at the midpoint. And literally all of it is, related to our strategic initiatives that we have confidence and that are getting better, with each vintage. And so yes, we’re not there’s probably I mean who knows what comes, but we’re not thinking about any new adjusting items.
Steve Lawrence: And Anthony I just, I want to tell you, you don’t have to apologize for asking the same questions, a fair question we always look forward to the challenging questions you put us to us.
Anthony Chukumba: Thanks for the kind words. Good luck with fiscal 2024.
Steve Lawrence: Thank you.
Operator: We have time for two more questions. Our next question comes from John Heinbockel with Guggenheim Securities. Please proceed with your question.
John Heinbockel: Hi Steve, can you just walk through CRM initiatives this year, right now that you’ve stood that up whether it’s reactivating customers wallet share. And how you’re going to lean into that. And then, the thought about personalized promotions, right you talk about this pricing bikes and fitness and stuff like that, do you see an opportunity to do personalized promotions where you’re not blasting that out to the marketplace, but being very surgical in how you attack that?
Steve Lawrence: Yes, it’s a great question. So I would say a couple things, first we installed the new CDP last summer. We spent the back half of last year testing a lot of different use cases in terms of customer reacquisition customer acquisition. I think as you move forward you’re going to see us lean into a couple of focuses first. Traffic is a challenge, I mean the traffic for and transactions for Q4 were down mid-single digits. Our goal is to drive more customers coming into our storm drive traffic. So I think you’re going to see us use, the CDP and working with our various agencies and partners to generate more lookalike audiences. And to really start filling the top of the funnel up that’s going to be a big focus for us.
I think you’re going to also see us then look at our high-value customers and look at ways to get them to shop with us more frequently and move people up the identity ladder. And have them become have some customers, who are more occasional shoppers become more loyal shoppers, and move them up. So I think you’re going to see a multi-prong focus there, but new customer acquisition and driving traffic is number one. And then moving customers up that identity ladder, to shop with us will be the second focus. In terms of more personalized promotions, I think you’re dead on I mean that that is the future. And that’s where I think we’re ultimately headed, we’re probably a little behind on this one that being said, it’s an opportunity for us. And I think you’re going to see us as we learn more about our customers have more one-to-one marketing, and to have more targeted promotions.
I think that will allow us to pull back on some of the more global promotions that we do run and that will be a journey to move forward. But there’s definitely an opportunity for that and it’s something we’re looking at very closely.
John Heinbockel: And just quickly last thing, when do you think – when do you launch the new loyalty program is that you know pre-holiday?
Steve Lawrence: Our goal is to have it in place sometime this year so pre-holiday definitely for sure. If we can get it in place before back-to-school we’d like to, but we want to make sure whatever we roll out is fully vetted and we’re very comfortable with. That being said what I want to make sure you understand is, we see this loyalty program as being a long-term build over time. This is not something we don’t want to come out with a bunch of benefits the customer may, or may not want. We want to make sure whatever we include in the initial rollout, is something the customers told us that they value. And so, you’re probably see us take some things that have resonated well with our credit card customer, which is kind of the basis of our loyalty program and extend that more broadly to a broader range of customers.
And then, test into new capabilities as we progress forward. So it’ll be a slow burn and an add over time, but we definitely want to get something out in the marketplace, before holiday.
John Heinbockel: Thank you.
Steve Lawrence: Thank you.
Operator: Our next question comes from Will Gaertner with Wells Fargo. Please proceed with your question.
Will Gaertner: Hi guys thanks for squeezing me in here. So if we just talk about the new stores, can you just talk a little bit about lowering the guide for the new stores I mean where’s the drag coming from? And then secondly are all the new stores that you’re opening are they all EBITDA positive is it vary by new – markets versus existing. And then, what gives you confidence in increasing your store footprint particularly is comps remain negative?
