Good afternoon and welcome to Mister Car Wash's Conference call to discuss financial results for the third quarter of fiscal 2021. Please note that this call is being recorded, and the reproduction of this call in whole or in part is not permitted without written authorization from the company. I would now like to turn the conference call over to Megan Everett, Senior Director of Communications. Please go ahead, ma'am.

Thank you. Good afternoon, everyone, and thank you for joining us today for Mister Car Wash's Third Quarter Fiscal 2021 Earnings Call. Speaking from management today on the call are John Lai, Chairperson and Chief Executive Officer; and Jed Gold, Chief Financial Officer. After John and Jed have made their formal remarks, we will open the call to questions. Before we begin, I do need to remind everyone that comments made today may include forward-looking statements, which are subject to significant risks and uncertainties that could cause the company's actual results to differ materially from management's current expectations. These statements speak as of today and except as may be required by law, the company does not have any obligation to update or revise such statements as circumstances change. Please review the cautionary statements and risk factors contained in the company's second quarter 10-Q as such factors may be updated from time to time in its other filings with the SEC. During the call today, we will also refer to certain non-GAAP financial measures. A reconciliation between the GAAP and non-GAAP financial measures can be found in the company's earnings press release issued earlier today and which is posted to the Investor Relations section of Mister Car Wash's website at ir.mistercarwash.com. With that, I'll turn the call over to John.

Thanks, Megan. Good afternoon, and thank you for joining us for our third quarter earnings call. I'd like to begin by briefly recapping our third quarter results and then discuss our strategic growth initiatives that will help drive long-term shareholder value. Jed Gold, our CFO, will then discuss our financial results, and we'll conclude with a Q&A session. From both an operational and financial perspective, we are very pleased with the underlying trends in our business. As many of you know, Mister Car Wash is the largest operator of car washes in the U.S., and we believe there is significant opportunity to continue building our brand and growing our market share. As a result, we've been focused on expanding our footprint and investing in our people to continue scaling our company. In the third quarter, revenue increased 24.7% from the third quarter last year to $194 million, driven by strong comparable store sales and unit growth. Adjusted EBITDA increased more than 44% from the third quarter last year to $62.5 million and reflects both increased operating efficiencies as well as investments we are making to drive long-term sustainable growth, which I'll discuss more in a moment. We opened nine new locations in the quarter, bringing our total store count to 360 as of September 30. We added over 30,000 new members to our Unlimited Wash Club and ended the quarter with over 1.5 million unique members. All of this helped us deliver another strong quarter of top and bottom-line results, continuing our track record of delivering consistent growth. This consistency in the business is a testament to the operational excellence that our teams deliver day in and day out, something that we are very proud of. And I'd like to thank all of our team members who create a magical experience for our customers. Putting all the numbers aside, it's the people that have made Mister the number one national brand in America. Together, we're building a culture and brand that is truly unique in the marketplace. In August, our senior management team had our first in-person strategic offsite since the pandemic began, and this meeting was our time to think big and go long, not be encumbered by the day-to-day. Often the best conversations are had around the campfire, and this meeting was no different. We started off by looking inward around our brand promise and reconfirming our commitment to continuously increasing our level of professionalism, convenience, and efficiency. In addition to fine-tuning our growth strategy, we collectively came away with a determined sense of purpose going forward. At the operations level, which is one of our strongest muscles, after over 18 months of social distancing, we brought our entire regional management team together for our first in-person national ops meeting. Over 100 of our fully vaccinated field leaders got together to discuss how to accelerate our growth while simultaneously elevating our already high standards. Stories were shared across the company of families whose lives were forever changed as a result of us going public. It was a very uplifting feeling to be able to finally raise our glasses and recognize not only what we just did but also get geared up for what's ahead. I'm thrilled to say that coming out of the meeting, our culture and esprit de corps as a mission-driven organization has never been stronger. We have a long history of developing our people and creating clear opportunities for those with the drive and ambition to take on more responsibility. We're proud that over 90% of our operations team started off as hourly employees, and they are now the ones who are developing our next generation of leaders to fulfill our vision. We recently introduced an accredited certified trainer program that turbocharges our digital learning platform called Mister Learn. We now have 112 certified field trainers alongside our 75 regional managers and 25 regional training specialists who are providing true mentorship programs to help us accelerate our leadership pipeline and prepare for even more unit growth. Probably the biggest headline for our team coming out of the IPO was our new long-term incentive plan, which gives a piece of the pie to over 800 team members, including all of our general managers, by awarding them meaningful restricted stock units. For the first time in our company's history, every single one of our 350 store managers are now owners in the company. They have been and always will be the most important position in our company, and we're thrilled to be able to finally reward them in a way that sets them up for a lifelong career at Mister Car Wash and true financial independence. And we didn't just stop with our GMs, we also want to recognize some of our amazing frontline team members who've been with us for more than 15 years, some even 20 years, who, in a lot of ways, are the heart and soul of our company. We awarded over 200 RSU grants, and the tears of joy that spread throughout the ranks was a tangible and meaningful symbol of our love and appreciation for their hard work and commitment. Now let me shift to our strategic growth initiatives. First is driving comparable store growth through increasing our Unlimited Wash Club member base. We operate the world's largest car wash membership program, and the predictable recurring subscription-based revenue has transformed every aspect of our business. We believe we can continue to grow our member base by introducing the benefits of UWC to more of our estimated 7 million to 9 million retail customers that come in for a single wash. Getting retail customers to adopt our service as part of their regular purchasing pattern is the Holy Grail for any consumer services business. Consequently, we're working on new ways to engage, convert, and retain our members through a much more sophisticated digital ecosystem. Additionally, as we increase store density, we're enabling our members to access a larger network of stores, which increases the customer value proposition; this emboldens us to increase our density in every market that we are in. This leads me to our second growth initiative, unit growth. We continue to see significant opportunities for future growth in our existing markets. The majority of our greenfield developments have materially outperformed our plans, and we're on pace to have the single biggest de novo year ever. We've opened 11 new stores so far this year and are on target to open 16 to 18 new greenfield locations for the year. Given the success of our greenfield program, we're aggressively building out our new store development and construction teams and have quadrupled our infrastructure in the last 12 months, which will allow us to increase the number of new stores we can develop. Working alongside some of our install partners, we've also elected to build out our own vertically integrated install teams to increase our project capacity as we continue to ramp our greenfield program with the opportunity for us to double or triple our footprint in existing markets. As we look ahead, we believe we have an opportunity to accelerate unit-level growth through strategic M&A, acquisition opportunities, and greenfield development in existing markets. That leads me to our third growth initiative, the training and development of our people. Our people are our biggest competitive advantage, and human capital is one of the most important factors to growing Mister. Our commitment to being the best-in-class employer began years ago, and over time, we've developed what we believe is the most comprehensive and competitive pay and benefits package in the industry. We've also been focused on raising the bar in bringing in the best talent across the company. With current unemployment levels at a 19-month low, today's labor market is extremely competitive. While our express car wash model, which represents the majority of our portfolio, is relatively low labor, we're working harder than ever to retain and attract the best talent. To get ahead of the curve in August, we began increasing our starting hourly wages while also increasing wages for our existing top performers to ensure that we don't lose them. In the face of higher wages, we've also been focused on improving productivity, and I'm happy to report that the number of cars in process on a per-employee basis is up 51%, with cost per car down 21%, and the total number of labor hours used per location down 29% compared to Q3 of 2019. I'd like to take this opportunity to thank every single one of our site managers who've done a terrific job of improving productivity, elevating the customer experience, and, most importantly, caring for their teams. Finally, I'm happy to welcome two new directors to our Board, Veronica Rogers, Senior Vice President, Head of Global Sales and Business Operations at Sony; and Ron Kirk, former Mayor of Dallas and member of the Obama Cabinet. The diversity of our Board demonstrates our commitment to creating a company and culture that is inclusive and brings to the table voices that have depth and breadth of experience that will ultimately make us a stronger and better organization. In summary, it was a strong third quarter, and I'm proud of the operational and financial performance our team is delivering. We're very optimistic about how we're going to finish 2021 and even more optimistic about 2022. I'd like to now turn it over to Jed.

Thank you, John, and good afternoon, everyone. We're pleased with our third quarter results and the underlying trends in our business. Our teams are executing well against our strategic growth initiatives and we continue investing in our future. Before we get into the numbers, let me make some high-level commentary on what we're seeing in the business. First, the fundamentals of our business are strong as evidenced by our top and bottom-line results. Second, we're observing strong member retention levels in our Unlimited Wash Club, and the big gains we experienced in the first half of the year are holding nicely thus far in the back half of the year. Third, like many other companies, we're seeing some continued inflationary input pressures, primarily in store-level labor and chemicals. We're offsetting these with selective pricing increases in the retail wash side of the business. Fourth, and perhaps most importantly, we continue to invest heavily in our people. As John mentioned, we have a significant opportunity to accelerate our growth and capture market share, both through acquisitions and greenfield openings. We have stepped up our management training and investments in people to better position us to take advantage of the opportunities in the marketplace. Now, let me review our third quarter results. My comments will focus on our adjusted non-GAAP results. Please refer to today's press release if you would like more details on our financial performance and our methodology in calculating non-GAAP financial metrics. In the third quarter, revenue increased 24.7% compared to the third quarter of last year to $194.3 million, driven by comparable store sales growth of 21% and unit growth of 6.5%. On a two-year basis, our comparable store sales grew 14.5% versus 2019 during the quarter. It's important to note that the third quarter last year included $6.8 million of revenue from the quick lube oil change business that was subsequently divested in December of last year. Excluding this from the comparison, revenue increased more than 30%. Our subscription or Unlimited Wash Club program remains a key driver of growth. In Q3, UWC memberships increased 31.5% to 1.564 million from 1.18 million as of September 30, 2020, and accounted for 66% of total washes in Q3, compared with 62% of total washes in the prior year period. With respect to unit growth, we added two stores through acquisitions and seven newbuild locations, adding up to nine locations in Q3 this year. As a result, we ended the quarter with a total of 360 locations versus 338 at the end of last year's third quarter. We continue to see strong performance and returns out of both our acquired and greenfield locations, and we believe there is an opportunity to potentially accelerate our unit growth over the next 12 to 18 months as we continue scaling our operations and solidifying our market share in key markets. Now to provide perspective on the balance of the P&L. This year's third quarter cost of labor and chemicals increased 26.3% to $63.4 million compared to $50.2 million last year. The increase in the cost of labor and chemicals was primarily driven by the recognition of stock-based compensation for store-level employees of $2.8 million, increased labor and benefits of $8.3 million in connection with the increase in wash volume, and increases in crew wage rates and investments in developing bench to support continued growth. These increases were partially offset by decreases in labor and chemical costs as a result of improvements in labor productivity levels and the sale of our quick lube facilities in December of 2020. Excluding stock compensation expenses, when looking at the cost of store-level labor and chemicals as a percentage of revenue, it was 31.2% compared to 32.3% of total revenue in last year's third quarter. However, during the middle of the quarter, we made the decision to step up our investments in labor to better position us for future growth. More specifically, we expanded our management training program, adjusted wages in certain areas, and ramped up our hiring efforts to strengthen our competitive positioning and labor bench. As we’ve said before, our people are both the key to our success and the biggest limiting factor to drive even more growth. The investments we are making today should position us well as we look at new incremental growth opportunities into next year. Other store operating expenses were $68.4 million in this year's third quarter, or 35.2% of revenue, compared with $56.1 million, or 36% of revenue last year. The increase was primarily driven by the increases in wash volume with comparable store sales growth and year-over-year additions of 22 locations, partially offset by a decrease in other store operating expenses from the sale of our quick lube facilities. General and administrative expenses in this year's third quarter were $22.2 million, or 11.4% of revenue, compared with $10.5 million, or 6.7% of revenue last year. The increase was driven by a $4.6 million increase in salaries and benefits, a $3.5 million increase in stock-based compensation expenses, incremental public company costs, and comparisons against the temporary staffing and pay reductions related to our COVID-19 expense cuts in the third quarter of last year. Interest expenses decreased to $5.7 million from $15.9 million last year due to the reduced debt levels after using the majority of the proceeds from the IPO to pay down debt. Our effective tax rate for this year's third quarter was 19% compared with 27.3% last year. The decrease was primarily driven by discrete tax benefits originating from stock options exercised during the quarter. Adjusted net income increased more than threefold to $34.8 million in the third quarter this year from $11.4 million last year, and adjusted net income per diluted share was $0.11 in the third quarter of 2021 compared with $0.04 in the prior year period. Adjusted EBITDA, which adds back stock-based compensation and certain nonrecurring or nonoperating expenses, increased 43.9% to $62.5 million in the third quarter this year versus $43.4 million in the third quarter of last year. Now moving on to the balance sheet. Cash and cash equivalents as of September 30, 2021, were $162.2 million compared with $58.3 million as of September 30, 2020, and $114.6 million as of December 31, 2020. Our total debt as of September 30, 2021, was $610.1 million. Gross capital expenditures totaled $89 million in the first nine months of fiscal 2021 compared with $43 million in the prior year period. Net of sale leaseback proceeds, CapEx through the first nine months was $66 million versus $33 million last year, an increase of $33 million, largely due to many CapEx projects put on hold during the height of the pandemic. Maintenance CapEx was $14 million in the first nine months of fiscal 2021 compared with $4 million during the first nine months of fiscal 2020. Let me now turn to our outlook for the full year 2021. We are raising our previously provided 2021 revenue and adjusted EBITDA outlook to the following: revenue of between $751 million to $756 million or growth of 30.6% to 31.5%; comparable store sales growth of 31% to 33%; a GAAP net loss of $45 million to $40 million; adjusted net income of $125 million to $130 million; adjusted EBITDA of $251 million to $253 million; and adjusted net income per diluted share of $0.40 to $0.44. We still expect to open 16 to 18 new greenfield locations, and capital expenditures net of sale leasebacks are expected to be about $76 million for the year. My high-level commentary around guidance is that our fundamental outlook for the business has not changed. We're flowing through the upside in the third quarter and leaving our outlook for the fourth quarter adjusted EBITDA relatively unchanged. We're driving strong revenue growth, offsetting higher labor and chemical costs with higher retail wash pricing, and we are continuing to invest in people to better position us for future growth. In conclusion, it was a strong Q3 from both a financial and operational perspective. I would like to reiterate our recognition and appreciation for our outstanding teams, especially our frontline team members that drive our performance day in and day out. With focused priorities across the organization and continued disciplined execution by our teams, we believe that Mister is well positioned to capitalize on the significant opportunities for growth that lie ahead. And with that, I'll turn it over to Chad to begin the Q&A session.

And the first question will come from Elizabeth Suzuki from Bank of America.

Just one question on the quick lube business that you divested. One of your competitors is thinking of co-branding their car wash with quick lube. I’m wondering why that wasn’t successful for you or why you would choose to have exited the quick lube business.

Yes. So this is John. We subscribe to the theory of doing fewer things well and focusing on our core competencies. At the risk of sounding somewhat myopic, we've got our hands full in delivering a clean, dry, shiny car consistently across our entire portfolio of 360 stores. So we like that we're a pure-play car wash company, and we're very focused on that. In the early days, we managed many ancillary profit centers, but we have been strategically shedding them, as Jed mentioned. Today, we wake up thinking, living, and breathing car wash, and we're happy that we're doing that.

Great. And then just one other question on growth. You've done a combination of M&A and also greenfield expansion historically, and you're still planning to do that going forward, I would assume. What are the merits of both? I mean, presumably, if you do an acquisition, you're also taking out a competitor at the same time, but then there's more work to convert signage and change over the experience to your brand. With greenfield, you could potentially run into issues of having not enough space to expand into or running out of locations. Just how are you thinking about both avenues of growth?

Yes. So I'll tackle the latter part of your question first. We see an unbelievable amount of white space and runway for new unit growth in our industry. We believe the industry can almost double in size before hitting any point of maturation. This is motivating us to double down on our greenfield initiatives. The pros and cons between M&A and greenfield are widely understood. You're paying up for an M&A acquisition opportunity to scale your business quicker, but sometimes the economics aren't as attractive, depending upon how much you're paying for that business versus a greenfield. We're looking at both as we enter new markets. Typically, it's done through a strategic M&A platform acquisition, and then we build out that market with bolt-on acquisitions as well as greenfield. We like having a dual path to growth and remain highly acquisitive while looking for new opportunities.

And the next question will come from Michael Lasser from UBS.

During the script, you talked several times about accelerating growth. What specifically are you referring to? And has the global supply chain challenge impacted the timing of any new greenfield locations? It wouldn’t be surprising if it's more difficult to get supplies to build new car washes from the ground?

Yes. Great, Michael. I'll take the growth question, and Jed, you can handle the supply side. We were referring specifically to unit growth and the opportunity we have to continue scaling our company and taking our 360-store chain to the next level. That's our path, ambition, and vision. The only thing holding us back is our ability to build out teams to support that growth. We are working to double or triple our construction and development teams and our real estate sourcing teams while simultaneously building out our leadership development pipeline to oversee the stores. So, we can build them, but we also have to run them, and we are on that parallel path.

Yes, Michael, we’ll provide our outlook for 2022 on our Q4 call, but we do see a little bit of upside to the 23% number that we had provided earlier. It's hard to find a company in today's environment that is completely insulated from the supply chain pressures. We’ve factored that into the 16% to 18% numbers between now and the end of the year, and it's considered as we think of 2022 and ahead.

Okay. And if I could get a follow-up question. You mentioned retail prices have gone up. How much have you taken? And has there been an elastic response on the retail side? I know you haven’t changed the price of the UWC program, but what’s the history of raising prices on retail? And as part of that, Jed, maybe you can offer some perspective, the cost of labor and chemicals margin was up about 44 basis points. You did a similar number of sales dollars this quarter versus last quarter, but the margin was much higher. Is that all because of increases in labor costs and chemical costs?

So, Michael, a couple of things there. The price increase we took was just on the retail side of the business, which makes up about 35% of our total sales. It was phased in early November. Roughly 80% of the stores received some type of retail pricing increase. With retail being the smaller part of the business, it impacted about 25% of our total business. Regarding the labor side and the cost of labor, it's the driver for this year’s margin versus last year. There’s a little bit of noise to consider, given prior year COVID adjustments. The investments we’re making on labor can be categorized into two buckets: inflationary pressures we're experiencing and our efforts to offset those while building up our team for continued growth.

Jed, can I just add to that? Historically, we’ve taken a very conservative approach to leveraging our pricing power. Where we sit today, we believe we still have additional room to adjust prices if necessary next year, and we can pass it through relatively easily. We never want to rush, and every move we make is measured and conservative. We have not touched our Unlimited Wash Club pricing because we are still in member growth mode.

And the next question will come from Greg Badishkanian from Wolfe Research.

This is David Bellinger on for Greg. I'll start on the UWC member growth. That slowed sequentially from an average of about 150,000 new members in each of the first two quarters of the year to about 30,000 this quarter. Is there anything you can highlight on that net change, maybe having to do with seasonality of the business or even labor at the store level? And do you think there was a pull-forward into the earlier part of the year?

Yes, David. When you look at the year-to-date growth for the Unlimited Wash Club, we're very pleased with the growth we've seen. We’ve added 330,000 new members year-to-date. We've grown it by just over 30% versus Q3 of last year. There is a bit of seasonality when you look at member sign-ups in the first half versus the second half. Historically, from 2015 through 2019, approximately 75% of sign-ups occur during the first half of the year. This year, with the macro trends we mentioned on our earlier call, we did see a spike in Q2 compared to previous quarters. It's difficult to determine if we pulled members forward or if we took members from last year and pushed them into this year. Overall, we're happy, sitting at over 1.5 million members in the Unlimited Wash Club, and we're successfully retaining those members.

Yes, Jed. I would add that the first half of this year was unusual, in a positive way, as we grew our member base significantly. However, in Q3, we were in line with historical growth trends. We take a steady, measured approach without deploying promotional gimmicks or tactics to lure people into the program. We educate and inform our customers, allowing them to sign up relaxedly for the program, and we're going to continue on this path.

That’s helpful. And just as a follow-up, the percentage of sales from UWC members stepped up about 4 percentage points sequentially to 66% of sales. Help us understand that improvement. Just to clarify, is pricing impactful at all there? And also, should we expect the price gap between your retail customer and the UWC to remain relatively consistent from here?

Yes, David. The pricing increases we took were just recently introduced, so the increase in the UWC sales mix to 66% is also impacted by the retail side, which was slightly trailing. As noted in our Q2 call, retail sales were more pronounced in driving growth in Q2. The gap isn’t going to increase; it’s going to shrink between retail and UWC. As we close that gap, in theory, that will provide value for our members and encourage more member growth.

The next question will come from Simeon Siegel from BMO Capital Markets.

John, sorry, I think I want to throw some quick ones over to Jed, if that's alright. Can you talk about your gross margin trajectory, I guess, next quarter, into next year just considering the inflationary points you referenced? Anything changed in your underlying incremental margin as you think about that flow-through? And the full year guide change, I think you raised revenues by $4 million to $9 million but brought the high end of net income down about $5 million. Is there something below the line that we need to keep in mind? Also, did you comment on what looked like the lower CapEx guidance for the year? Is that related to lower gross CapEx or higher leasebacks?

Jed, before you answer Simeon's questions, I’ll say I’m waiting for the day you ask me a question about culture. But I’ll let Jed handle the hardball questions about specific misses.

Simeon, as we think about gross margin and the quarterly cadence, there’s some timing where we made investments in labor in August, while pricing goes into effect in early November. You’ll see some movement as we balance that. Q2 was an anomaly with the 37% margins, and we expect this to come down, aligning with our expectations in that 30% range. We’re considering this on a full year basis, not just from quarter to quarter. On the CapEx side, it's slightly lower; don't read into that. It’s a timing issue related to sale leasebacks and when actual CapEx spending occurs. Keep in mind, on the CapEx front, development has an 18-month lead time cycle, so spending you’re seeing is directed towards 2022, 2023 new builds.

Our physical plants are in better shape than ever, set up for peak performance. We’ve embraced technology across all aspects of our business, allowing us to process 150 to 180 cars, and in some cases, 200 cars per hour depending on the store.

Perfect. And then just a quick follow-up. John, I’m just wondering, are you pro or against having a positive culture?

Culture eats strategy for lunch.

And the next question will be from Peter Keith from Piper Sandler.

I wanted to circle back on pricing. I don't think you guys have raised prices for a long time as I check back in my notes. If you have at any point, historically, what have you seen with demand trends? And have you historically seen an uptick in membership penetration when you raised retail prices?

Yes. We have taken a conservative approach to discussing pricing internally. Historically, every time we've made a pricing move, we have not seen any material impact on our volumes. It has been relatively easy to pass through increases. We're going to remain conservative and only make pricing changes when necessary. The recent move in November, while putting initial pressure on margins, is necessary, and we are still determining how the future labor market looks.

The one thing I would add, Peter, is that we’re always looking at retail pricing. Historical retail pricing actions have not significantly affected volume. The subscription business is unique compared to other sectors and has historically driven UWC sign-ups.

No, we manage staffing to deliver a beautiful customer experience and we're improving productivity. Some top-quartile stores were running heavier than needed, and we rightsized midway through the pandemic while converting some full-service locations to express models, which require less labor.

The next question will come from Simeon Gutman from Morgan Stanley.

First question is short term on the fourth quarter. Can you help us what's implied in terms of the comp? I know there are some puts and takes from the prior year, and I wanted to clarify. It looks on the surface as a quiet acceleration but trying to get that clarified.

Yes, Simeon. When you look at the cadence going into Q4, it’s July, we are plus 31%; August, plus 21; September, plus 23%. We’re seeing good momentum going into the quarter. Keep in mind, from a comp perspective, it's progressively more difficult towards the back end of this year due to the reopening of our interior clean locations last year. Therefore, comparable store sales can be affected making it a little more difficult.

Okay. And then the second question, I think this was touched on, but I’d make two parts. One, is there competitive responses in the markets in which you compete regarding the cost of competing washes, express washes or memberships? And then the changes you’ve made to the full service, are we at a good place now without future price increases? If the situation evolves, may you have to make a move?

So that was a three-part question. The pricing from our competitors has actually been ahead of where we made moves. Our average express retail price point across our 360 stores is roughly $8 while many competitors are at $10. They’ve taken pricing earlier than us, but we just aligned ourselves at $8. We believe there is room for pricing adjustments. Regarding our Unlimited Wash Club pricing strategy, we are not touching it as we focus on member growth. We aim to grow our member base. So, the interior clean represents about 75 of our stores and we currently have a dozen opportunities to convert to express locations. The 50 stores remaining are high-performance engines generating significant revenue and EBITDA. They’re critical for talent development, allowing us to promote our top operations staff into new markets. While we appreciate our interior clean side of the business, our unit growth strategy moving forward focuses almost entirely on express.

As John noted, we will always look for opportunities to take price. We still have opportunities to consider adjustments based on competitive and economic factors as they evolve. The impact of pricing actions taken in November will have a minimal impact on comps moving forward, keeping us in low single digits.

Ladies and gentlemen, this concludes our question-and-answer session. I would like to turn the conference back over to John Lai for any closing remarks.

We’ve had a great year so far with strength in all-around performance. As we look ahead, our focus will remain on continuously elevating the customer experience as we grow our network of stores and customers, all while maintaining the operational excellence and people-first culture that has come to define us. Thank you for joining us on the call today. We look forward to a solid Q4 and finishing the year strong. Thanks, everybody.

Thank you, sir. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.