Navdeep Gupta: Yeah. So, few comments that we gave out in our prepared comments today. First of all, I’ll start with the sales, right? We are going to have a shifted calendar. So, there’ll be a little bit of an impact to our total offline sales, total revenue, but not a significant impact when you think on a shifted basis on comp. What we did call out was just a reminder, we saw the elevated levels of shrink in Q2 of 2023. So, in Q1, we haven’t lapped that as yet. So, as you all are modeling, it will be helpful to keep that in mind. The other is the tax rate. If you remember, our tax rate in Q1 was significantly low compared to a normalized tax rate, and you will see that piece play out as well. And finally, hopefully you all have watched some of the exciting brand campaigns that we have going on right now between brand campaigns associated with our launch of our CALIA Inspire collection, our DICKS.com campaign.
And so, we are investing into that. In addition, we are going to be opening two really exciting House of Sport locations here in Q1 between Ross Park Mall here in Pittsburgh and our Prudential Center. So, you will see some of the investments associated with those two stores in Q1 as well. So, a slightly elevated level for preopening expense, maybe I’ll just put a final point on that one.
Chris Horvers: Got it. Thank you very much.
Operator: Your next question is from the line of Kate McShane with Goldman Sachs. Please go ahead.
Kate McShane: Hi, good morning. Thanks for taking our question. I wanted to ask about just if there was any more detail on the performance of footwear versus apparel versus hardlines in the fourth quarter? And our second question was, if there was any impact to the 2024 comp guide as a result of the relocations that you’re doing for House of Sport?
Lauren Hobart: Thanks, Kate. So, in terms of category performance, with the 2.8% comp this past quarter, we saw growth across all of our key categories. So, growth in footwear, growth in apparel and growth in some of the key hardlines categories. So, really it was across the board. The only area of softness was the cold weather that didn’t come as we had hoped it would. And so, there was some softness in outerwear, but across the board, really strong growth in our core categories. I’ll turn it to Navdeep to the next question.
Navdeep Gupta: Yeah. Kate, in terms of the comp guidance overall, like we said, because of the shifted calendar, no material impact to the comp cadence itself when you look at it. However, keep in mind last year, we were converting eight combo locations into House of Sport, which were closed during the first half of last year. So, we expect our comp in the first half to be slightly stronger than the comps in the back half of the year.
Kate McShane: But there won’t be any impact from store closures as you relocate this year?
Navdeep Gupta: No. We’re not doing the closed/remodels as we did last year.
Kate McShane: Got it. Okay. Thank you.
Operator: Your next question is from the line of Robbie Ohmes with Bank of America. Please go ahead.
Robbie Ohmes: Hey, guys. Great quarter, and thanks for all the commentary on the store economics. Really appreciate that. A couple of follow-ups on just the fourth quarter. Can you give us some sense of sort of digital transactions versus in-store transactions in the fourth quarter? Were in-store transactions positive?
Lauren Hobart: Hi, Robbie. Thanks for the question. We’re not guiding to digital versus in-store overall. In the fourth quarter, transactions were flat. Most of the growth came from ticket. However, it’s really important to note that in Q4 of last year, we were up over 7.6% in transactions. So, from a two-year basis on an omnichannel standpoint, really, really strong growth in transactions. Digital business remains really strong, but we’re not going to get into more details on that.
Robbie Ohmes: And then just for the comp guidance you’re giving for 2024, should we — how should we think about the ticket versus transaction component?
Navdeep Gupta: Yeah, Robbie, we won’t break that down any further. Really excited about to be able to guide on a positive basis on top of a 2.4% from last year. And our focus is continuing to be about driving sales and profitability growth for the business.
Lauren Hobart: Overall, this year we did have — the majority of growth did come from transaction growth, if you look at the 2.4%. So, we are very confident in our comp guidance.
Robbie Ohmes: And then just one quick clarification. On the — for the store economic models, when you guys say omnichannel sales, is it a web sale that’s fulfilled by the store to — what gets included in omnichannel sales at a House of Sport or the new 50K store?
Navdeep Gupta: Yeah. No, Robbie, that’s exactly it is. It’s not only the stores that are fulfilled from a store [indiscernible] even an omnichannel sale or a digital sale that gets fulfilled by the store is also included in that, because that’s what we look as the four-wall performance of the store, including the work that our team members are doing in fulfilling an omnichannel order.
Lauren Hobart: Yeah. And the stores are fulfilling over 80% of e-com orders, 90% of orders across the board if you include the brick and mortar. So, it’s appropriate to think of it as omnichannel sales.
Robbie Ohmes: Got it. That’s really helpful. Thanks so much, guys.
Lauren Hobart: Thank you.
Navdeep Gupta: Thanks, Robbie.
Operator: Your next question is from the line of Brian Nagel with Oppenheimer. Please go ahead.
Brian Nagel: Hey, good morning. Congrats on another nice quarter.
Navdeep Gupta: Thank you.
Brian Nagel: First question I have, just to go — it wasn’t that long ago we were talking a lot about shrink. Looking at the results today in your commentary, it seems as though you’ve done a nice job kind of getting your arms around the shrink. The question I have is, as we’re looking now into 2024, how should we be thinking about the trajectory in shrink or the mitigation efforts that are ongoing at DICK’S to manage shrink?
