But as you know, our core customer, she’s the smartest customer, I believe, in retail, and she figures this out over time. And our box is more relevant than ever as a result of the investments we’ve made over the last several years. And that allows us to go where the customer wants us to go and do it more profitably. And that’s a very enviable position for us, and I think our market share gains kind of show that. But that’s kind of what we’re seeing from the customer standpoint. And certainly, there’s some near-term challenges that have just recently emerged. I’ll let John talk about that in Q1.
John Garratt: Yes. So in terms of the customer, as Jeff said, we’re continuing to see an increasingly economically strained customer, and we’re seeing shopping behaviors indicative of this environment. The two recent events we’re monitoring is the termination of SNAP benefits, the emergency waivers in the remaining states, coupled with lower tax refunds in recent weeks. It’s possible this could further pressure the low-income customers somewhat in the near term, remains to be seen. We didn’t see an impact last year. Some rolled off, but the customer is in a different place now. So we’ll carefully monitor that, but we continue to believe that the customer needs us even more in tough environments as history has shown, and our full year guidance is reflective of all we know today.
In terms of the shape of the year, I’ll kind of talk to first half, second half and then Q1, both in terms of sales as well as earnings. As you look at the shape of the year, as we indicated, it’s really a back half story for EPS growth. Now we’re expecting sales comp to be relatively even between the first half and the second half, slightly higher in the second half. But then we expect continued headwinds, as we mentioned, from sales mix pressure, higher interest expense and increased shrink and damages as we move through Q1 or rather than the first half. And then in the second half, we anticipate a pretty sizable benefit from lapping the significant supply chain costs and winter storm impacts from the second half of 2022 as well as the benefit of the initiatives that we’re driving.
Now as you look at Q1, we mentioned that we anticipate certain headwinds to be most pronounced in Q1. That includes the estimated year-over-year increase in interest expense, which we quantified as $40 million as well as inventory damages and then the residual impact of the storage capacity constraints and related supply chain efficiencies — inefficiencies we’ve mentioned. And then the other piece is with regard to the labor investment. We expect the year-over-year net impact pressure from that to be most significant in Q1. That’s because we don’t begin lapping last year’s smaller investments until Q2 and believe the benefits of the incremental labor will be more significant later in the year.
Matthew Boss: Great. And then maybe just a follow-up, John, on the balance sheet. Could you just update us on free cash priorities? What is the multiyear debt leverage target? How best to think about CapEx as a percent of sales moving forward? And just share repurchase as a use of cash going forward?
John Garratt: Sure. I’ll start by saying that our capital allocation priorities have not changed. Our first priority remains investing in the business. When you have high return growth opportunities like new store growth, remodels and our strategic initiatives, that’s where we focus our capital. Then our second priority is then returning the excess cash to shareholders based on the excess cash and debt capacity, paying a competitive dividend as we increased this quarter. And then by buying back shares with the remaining excess cash and debt capacity, but we remain focused on protecting our current investment-grade credit rating by keeping our adjusted debt to EBITDA around 3. In terms of CapEx, that is up a bit this year. We guided to $1.8 billion to $1.9 billion.
