Operator: Good morning, everyone, and welcome to Lowe's Companies Fourth Quarter 2010 Fiscal Year Earnings Conference Call. This call is being recorded. (Operator Instructions).
Statements made during this call will include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Management's expectations and opinions reflected in those statements are subject to risks and the Company can give no assurance that they will prove to be correct. Those risks are described in the Company's earnings release and in its filings with the Securities and Exchange Commission.
Also, during this call, management will be using certain non-GAAP financial measures. You can find a reconciliation to the most directly comparable GAAP financial measures and other information about them posted on Lowe's Investor Relations website under Corporate Information & Investor Documents.
Hosting today's conference will be Mr. Robert Niblock, Chairman and CEO; Mr. Larry Stone, President and COO; and Mr. Bob Hull, Executive Vice President and CFO.
I will now turn the program over to Mr. Niblock for opening remarks. Please go ahead, sir.
Robert A. Niblock - Chairman and CEO: Good morning, and thanks for your interest in Lowe's. Following my remarks, Larry Stone will review operational performance and Bob Hull will review our financial results. We delivered solid results for the quarter, including earnings that exceeded our guidance and I would like to thank our more than 234,000 employees for their hard work and dedication.
Sales for the quarter increased 3.1% and comparable stores sales increased 1.1%. Our domestic comparable store sales increase was 1.3%. Our fourth quarter sales benefited from a strong start to the holiday season, resulting in great sell-through of seasonal products. However, difficult winter weather negatively impacted performance in the month of January. Comp average ticket was up 1.9% in the fourth quarter, but comp traffic was down slightly.
New store cannibalization reduced comps by approximately 35 basis points in the quarter. We continue to be pleased with our merchandising strategies and seasonal sell-through, which helped us deliver 60 basis points of gross margin expansion in the quarter. We also leveraged expenses and delivered earnings per share of $0.21, an increase of 50%, which exceeded our guidance for the quarter.
We used third-party data to gauge our retail market penetration. On a rolling four quarters basis, we maintained our total unit market share with gains in 10 of our 19 product categories, including strong gains in hardware and tools.
I'm pleased with our inventory position at the end of the fourth quarter, which was up less than 1% year-over-year. Since the end of the first quarter, we have carefully managed our purchases, driven exceptional seasonal sell-through and rationalized our assortments. Most importantly, we’re able to accomplish this without sacrificing in-stock levels.
Overall, our growth in household spending picked up late in the year. It remain constrained by higher employment, modest income growth, lower housing wealth and tight credit and while consumer confidence rose in February to its highest level since February 2008, it remained close to the lows of the prior recession and near historical lows.