Welcome to the Advance Auto Parts Third Quarter 2020 Conference Call. Before we begin, Elisabeth Eisleben, Senior Vice President, Communications and Investor Relations, will make a brief statement concerning forward-looking statements that will be discussed on this call.

Elisabeth Eisleben - Senior Vice President, Communications and Investor Relations

Good morning and thank you for joining us to discuss our third quarter 2020 results. I am joined by Tom Greco, our President and Chief Executive Officer; and Jeff Shepherd, our Executive Vice President and Chief Financial Officer. Following their prepared remarks, we will turn our attention to answering your questions.

Before we begin, please be advised that our remarks today may contain forward-looking statements. All statements other than statements of historical facts are forward-looking statements, including but not limited to statements regarding our initiatives, plans, projections and future performance. Actual results could differ materially from those projected or implied by the forward-looking statements. Additional information about factors that could cause actual results to differ can be found under the captions, Forward-Looking Statements and Risk Factors in our most recent Annual Report on Form 10-K and subsequent filings made with the Commission.

Now, let me turn the call over to Tom Greco.

Tom Greco - President and Chief Executive Officer

Good morning, everyone. Allow me to start by thanking each of our Advance team members and Carquest Independent Partners, for their tireless efforts to delight and serve our customers. Our entire team faced challenges every single week throughout Q3, and I'm reminded daily that our role in supporting essential workers has never been more important to our success.

We've been operating with three overarching priorities during the COVID-19 pandemic. First, prioritize the health, safety and well-being of our team members and customers; second, preserve cash and protect the P&L during the crisis; and third, prepare to be even stronger following the crisis.

We made progress on each of these objectives in the quarter. Our dedicated leadership team remains focused on the health and safety of our team members and customers, regularly cascading safety protocols and updating our playbooks for the pandemic. This includes health checks for all team members instituted company-wide in Q3. We also provided cooling fabric masks in the summer to address heat concerns while ensuring our team members had face protection.

Our communications team keeps visibility high through virtual town halls and regular video updates to ensure team member engagement. We're also benchmarking and working collaboratively with the industry and professional organizations to continuously improve our response to this rapidly changing environment.

Bottom line, we remain vigilant to protect our team members and to ensure that our customers have a safe and positive experience in our stores.

Turning to Q3 results. Our net sales grew 9.9% to $2.5 billion compared to the prior year, and we delivered comparable sales growth of 10.2%. This is our strongest quarterly performance in 15 years.

Adjusted operating income increased by approximately 33% to $272 million, and our adjusted operating income margin rate increased 183 basis points to 10.7%.

As you'll hear from Jeff, we also strengthened our cash and liquidity position throughout the quarter, highlighted by our quarterly free cash flow improvement of 95%. Recently, we saw a positive comp sales and cost in every region, with the Gulf Coast, Central and Southeast posting strong double-digit comp growth. Our Northeast, Mid-Atlantic and West regions, while still positive at mid- to- high-single digits, were below our overall comp growth in the quarter.

As we noted in Q2, there remains a wide gap between our highest and lowest performing regions, although this narrowed in Q3 to approximately 900 basis points on average between the six regions I just mentioned.

The good news is that the Northeast, which is our largest region, had the most improvement of any region in the quarter versus Q2. As we have been in the broader auto parts industry and total retail data, the performance of these lower growth geographies has been more impacted by COVID-19 and is consistent with our internal results.

On a category basis, we saw sales strength in batteries, as well as continued growth in appearance and optics that began in Q2, when stay-at-home orders were implemented.

While there are many puts and takes in Q3, we believe the net benefit for the industry was driven by three primary external demand drivers. First, there were economic drivers. Due to the uncertainty of the macroeconomic climate and increased unemployment, there have been fewer new vehicle sales and more used vehicle sales. This results in an ageing fleet, which is good for both DIY and, ultimately, Pro

Secondly, there were COVID-related factors. As we've discussed before, we believe consumers have an understandable fear of using mass transportation, creating a heightened emphasis and reliance on personal vehicle. In some cases, people are working from home and have time on their hands to do their own DIY maintenance and repairs.

Finally, it's our belief that when motorists had DIY needs in this environment, they prefer to shop in smaller boxes. In our stores, they can feel safe, get the trusted advice they need and get back on the road quickly, so they can do the job well.

Of course, some of the benefit from these external factors is offset by the reduction in miles driven, which is an important demand driver for our industry. When this begins to recover, we expect that will provide a tailwind for the industry. We believe the majority of our accelerated top line growth in the quarter and in particular the strong DIY performance is due to these external factors.

Our industry has historically performed well during challenging economic times. Considering prior periods when the economy was challenged, DIY is generally an early beneficiary, followed relatively quickly by Pro recovery.

Looking more closely at our Pro business, we delivered mid-single digit net sales growth in Q3, following the decline in Q2 due to the temporary closure of garages across North America. In Q3, our machine learning platform, Dynamic Assortment, enabled us to have the right part in the right place and improve availability. This enabled both assortment and close rate improvements as look-ups and demand surged.

We also deployed new customer delivery software for Worldpac, Advance, and Carquest, which includes real time updates and notifications for all users. In addition, our Pro customers were very appreciative of the continuing interactive virtual classroom training we provided through our Carquest Technical Institute. This included the ability for Pro customers to extend the training content to all technicians within their repair shops.

On our MotoLogic platform, we continued to enhance our technical service bulletins and also deploy this valuable tool in Carquest Canada. These tools, in addition to our sustained focus on improving the overall experience for Pro customers, enabled us to further grow our Technet based during Q3, as we crossed the 12,000-customer mark.

In addition, our Carquest Independent team had another strong quarter and has now converted 36 new stores to the Carquest family year-to-date. Once again, we know this has been a difficult time for professional shops, and we believe the work we've done to be there for professional customers when they need us most has set us apart.

Moving on to DIY omni channel. We delivered another quarter of double-digit net sales growth in Q3. These results were driven by the external drivers discussed earlier, coupled with our DIY growth initiatives. Our growth initiatives are primarily focused on increasing share of wallet with existing DIYers, while attracting new DIY customers.

Based on the syndicated data available to us, we drove meaningful share gains throughout the quarter. Our DIY initiatives start with DieHard. While we believe DieHard is benefiting our performance in all channels, we can clearly see improvements in our DIY battery share behind our launch.

In October, we introduced our DieHard is Back campaign. This advertising launched with the two-minute film on October 18, during the Fox NFL game of the week. This integrated campaign featuring Bruce Willis, has already generated over 2 billion impressions, and more than 1,200 earned media placements. We believe our marketing plans will drive continued support during the winter months when batteries fail and customers need a reliable solution. We think we have significant room to grow DieHard in the battery segment.

Secondly, we continue to focus on building awareness for the Advance brand to attract new customers and drive traffic. In addition to leveraging more effective advertising, including DieHard, we're strengthening our digital engagement with DIYers when they visit our website or download our app.

Q3 highlights include the continued growth of our Advance Same Day suite of services and strong momentum and consumer response to the launch of our mobile app earlier this year. These and other initiatives help drive strong double-digit sales growth in e-commerce for the quarter.

Third, we continue to see year-over-year growth in active Speed Perks members since the rollout of our new program in the summer of 2019. Importantly, we are seeing a steady increase in members graduating to the Elite and VIP levels. Our graduation rates improved by more than 20% year-over-year, reflecting important share wallet gains with heavy DIYers. We're leveraging first-party data gathered through this program to deliver a personalized experience for our customers.

Finally, we remain focused on execution across the board. We did an excellent job with the DieHard launch overall and saw year-over-year Net Promoter Score improvement across all channels.

In summary, our topline performed well in the third quarter, driven by the factors just discussed. So far in Q4, through the first four weeks, comp sales remained positive across all channels in the mid-single digit range.

As a reminder, Q4 tends to be our most volatile quarter each year, primarily due to fluctuations in weather. In addition, we remain sensitive to potential volatility from other external factors in the current environment, particularly those related to the future spread of COVID, and the possibility of heightened stay-at-home orders in the near term.

Much more within our control is the execution of our four pillars of margin expansion, as we demonstrated in Q3. Starting with our first pillar, our top line growth during Q3 contributed toward sales per store improvement versus the previous year. Additionally, on a rate basis, our SG&A per store improved year-over-year.

We're managing store pay roll with greater effectiveness as a result of our MyDay scheduling tool. Our team continues to plan payroll conservatively in the current environment, balancing customer service and costs very closely.

In terms of supply chain, we're making progress with our cross-banner replenishment or CBR initiative. We completed nearly one-third of our original plan, which redirect stores to a more freight logical distribution center and reduces stem miles across our network. We're already beginning to see savings from the stores that have been completed as a result of reduced miles.

We are on-track to complete approximately 40% of our identified stores by the end of the year, with completion and full run rate expected to be realized by Q4 2021. Importantly, our team has found further opportunities for improvement than initially modelled, which includes additional stores that can be included following the completion of the first phase.

In addition to CBR, our single warehouse management system implementation or WMS, is also well underway after a temporary pause due to the pandemic. Our team mobilized to adjust our plans, which now includes virtual implementation capabilities. We are installing a new WMS, starting with our 11 largest DCs, of which we expect four to be completed this year.

Based on what we know today, we expect to finish the entire WMS implementation by the end of 2022. With that said, we will realize savings as each additional DC is completed.

In terms of category management, we made progress in Q3 on own brand expansion. We expect to finish 2020 with a significant increase in own brand SKUs, and to further enhance our SKU mix next year. Our margin rate on own brand SKUs is meaningfully higher than comparable applications in their respective categories. This will enable further growth in margin rate in the years to come. Separately, our new strategic pricing tool is beginning to enable both profit dollars and margin rate improvement through pricing initiatives rolled out in the quarter.

Finally, SG&A productivity continues to be a source of margin expansion. First, we made progress on the consolidation of disparate back office systems, which is our largest area of opportunity within SG&A. In Q3, this was highlighted by progress on our finance ERP implementation. In addition, we continue towards the integration of Worldpac and Autopart International.

We also continue to address opportunities to optimize our organizational structure, including support contracts and professional fees. Consistent with this, we made the decision to consolidate our field structure from two divisions to one, in May. In early October, we further streamlined our sales structure from 12 to eight regions. We believe that these moves enable us to serve our customers with even greater effectiveness, efficiency and flexibility.

The recent field changes also enabled us to bolster certain areas in our corporate support center, with seasoned field operators. As an example, we frequently discuss the importance of diversity and inclusion and it's inextricable win to our business strategy. As part of it, we welcomed Dena LaMar, having served as our RVP of the Great Lakes region for the past three years for our leadership team, as our new VP and Chief Inclusion and Diversity Officer. Dena has a deep field leadership background in retail, both inside and outside of Advance, and her leadership and enthusiasm for building a high performing, diverse workforce made her an ideal candidate for this role.

The second area of opportunity within SG&A is rent. Based on the current environment, we're thoughtfully evaluating our real estate footprint, including office space. This involves negotiating with landlords for concessions on lower return properties, and in some cases exiting the property altogether. We've engaged a third-party to help with this and expect it may result in some short-term cost headwinds in Q4, specifically, buying out leases that are unproductive, where we determine the building is no longer necessary.

Third, we have a dedicated team reviewing the existing plans we have for every single line item within SG&A. They're assessing the productivity we had planned pre-COVID, and also capturing key learnings we've had during COVID. This team is recommending areas of refinement and further opportunity as we move forward. For example, during COVID, we limited company-wide travel, which will continue for the balance of the year. Going forward, we intend to leverage virtual options and do not plan to return to pre-COVID levels of travel.

Another area of opportunity is further reduction in our insurance and claims expenses. Here, we continue to make progress on our lost-time injury rate. LTIR represents our most severe accident and was 33% lower than the prior year. In addition, our sustained focus in Q3 resulted in a reduction in collision frequency rates of 13% versus the prior year.

Our Advance Driver program and Smart Drive Event-Based Video Coaching is also being rolled out, which we believe will help us further reduce our collision frequency rate.

In summary, we continue to believe that margin expansion is a significant opportunity for Advance to drive total shareholder return, and we remain focused on the initiatives we have in place pre-COVID for the four pillars of margin expansion.

While executing these previously established plans, we're also closely monitoring the current and future environment to identify new productivity opportunities to drive total shareholder return.

Before I turn it over to Jeff, I'd like to recognize the impressive results our team members and generous customers delivered in American Heart Association campaign. Following a successful campaign last year, I could not be prouder of our team's efforts this year to raise $1.4 million, which was a 38% increase compared to last year. We delivered this record-setting campaign while providing exceptional customer service and remaining relentlessly on the execution of our long-term plan.

In closing, our third quarter results were another step in the right direction. Despite uncertainty that remains in the current environment, we remain focused on executing our long-term strategy.

With that, I'll turn it over to Jeff, for details on our financial performance.

Jeff Shepherd - Executive Vice President, Chief Financial Officer

Thank you, Tom, and good morning, everyone. I want to reiterate Tom's thanks to our team members for their dedication and hard work, not only this past quarter but since the pandemic began.

We have been extremely diligent in ensuring safety measures are in place throughout the enterprise. At the same time, our team members have risen to the challenge. The positive print we released today would not have been possible without them.

In Q3, our adjusted gross profit was approximately $1.1 billion. This was an increase of 11% compared to Q3 of the prior year. Adjusted gross profit margin rate improved 60 basis point year-over-year to 44.4%, driven by favorable pricing actions and supply chain efficiencies.

These improvements coupled with channel mix were slightly offset by unfavorable product mix and headwinds associated with shrink and defectives. It's also important to note that while we experienced tailwind associated with LIFO, these tailwinds were offset by capitalized supply chain costs, resulting in no net impact from the inventory-related costs and benefits both in the quarter and compared to the prior year.

Our adjusted SG&A was approximately $857 million in Q3, an increase of 5.8% compared to Q3 of 2019. Adjusted SG&A as a percent of net sales improved by 133 basis points compared to the prior year, primarily driven by an improved payroll and rent leverage, reduction in travel and our continued focus on safety, leading to a reduction in insurance claims, as Tom had mentioned. These cost savings were partially offset by an increase in support contracts related to our transformation initiatives.

In addition, our COVID expenses for the quarter were approximately $9 million. The majority of these expenses are related to ongoing costs, such as cleaning supplies, gloves and masks, and enhanced first-aid benefits during the pandemic. We expect to incur these costs for the foreseeable future.

Adjusted operating income in Q3 was $270 million, which improved 32.6% compared to the prior year quarter. Our adjusted OI margin rate improved a 183 basis points to 10.7% in the quarter.

Adjusted diluted EPS was $2.81, an increase of 34%. Year-to-date free cash flow was $616.6 million compared to $539.3 million during the same period in 2019, driven by strong top line results, improved working capital and the deferral of Federal Payroll Tax.

In Q3, our capital expenditures were $52.5 million, which was a decrease of $5.3 million compared to the prior year. In line with our financial priorities, during the quarter, we completed the early redemption of our 2022 notes and tendered approximately 57% of our 2023 notes, both of which carry a 4.5% coupon rate. This was completed using both cash on hand as well as proceeds from the $350 million, 1.75% note issued during the quarter.

Our disciplined approach to managing our balance sheet has allowed us to take advantage of the current low interest rate environment, resulting in a stronger debt maturity profile and improved leverage ratio. We believe our debt financing initiatives have further safeguarded the business for the future.

Our disciplined approach to managing cash resulted in AP ratio of 80.8%, which is the highest we've achieved since the GPI acquisition.

We remain confident in our ability to generate meaningful cash from the business and to opportunistically return cash to shareholders.

As we discussed last quarter, we lifted the temporary suspension of our share repurchase program. During the quarter, we repurchased nearly a $110 million Advance stock at an average price of approximately $153 per share. This, combined with the continued payment of the $0.25 quarterly cash dividend per share, approved by our Board, further demonstrates our confidence in the long-term strength of our business.

Given the continued uncertainty around the impact of COVID-19 and the current economic situation, we will not be providing guidance for the balance of the year.

Traditionally, Q4 has been our most volatile quarter with weather having a meaningful impact on results. In addition, there are couple of factors impacting SG&A to consider in Q4.

First, we have known incremental costs compared to the prior year related to COVID-19 expenses. Secondly, as Tom mentioned, there will be costs associated with buying out unproductive leases. Third, we are investing in the DieHard is Back marketing campaign. We also want to remind you that our fourth quarter this year includes a 53rd week. With the exception of comparable store sales, we encourage you to include the impact of these factors in your modelling.

Finally, we are updating our strategic business plan, informed by our best estimates and assumptions of the environment. Our plan is to finalize this in early 2021 and provide you with an update after our Q4 earnings release. We expect to finalize the date in the near future and look forward to sharing additional details with you.

In conclusion, we are pleased with the results of the quarter and believe that we have positioned ourselves positively for the remainder of 2020. We know that we cannot predict what this winter would bring, but we remain committed to top line growth, margin expansion and managing our liquidity.

With that, let's open the call to address your question. Operator?

Question & Answers

Operator

[Operator Instructions] And your first question is from Simeon Gutman with Morgan Stanley.

Simeon Gutman - Morgan Stanley - Analyst

Thanks. Good morning, everyone. I realized you're not ready to talk about guidance going forward for '21. Can you talk about the transformation overall? And you said that you've restarted some element of the supply chain overall; can you - can we get to, I guess, operating margin expansion that's a little bit higher than what we saw in this quarter or - not higher, sorry - in a 50 to 75 basis point range going forward in more of a normalized environment or have some of the elements of the supply chain being delayed this year will cause those to be prolonged?

Tom Greco - President and Chief Executive Officer

Hey, good morning, Simeon. Definitely it has taken a lot of time over the last couple of months to look forward and really understand what we think is going to happen over the next several years and put all of our initiatives through what we call a post-COVID lens, and feel very excited about the TSR opportunity ahead. For sure, the expansion of margins is a big part of that; and as we said consistently, we do believe we can expand at a greater rate than we certainly did last year.

So, that's the plan. We're going to continue to drive the key areas of margin expansion that we've spoken about, sales and profit per store, the supply chain initiatives are key, driving the category management initiatives, and then further opportunities within SG&A; and that combined with continued topline growth, will drive some strong cash flow for the company and be able to return excess cash to shareholders.

So, the plan is continuing on and we look forward to executing against it next year.

Simeon Gutman - Morgan Stanley - Analyst

So, I have two follow-ups to that, Tom. I think Jeff mentioned some marketing accelerated in the fourth quarter. Did spending on DieHard caused you to like slow some of that expansion to invest a little bit faster in marketing in the near term? And then you said using cash, it seems like the cash is growing. Are you going to deploy it quicker or are you waiting to get through this environment before deploying it?

Tom Greco - President and Chief Executive Officer

Yes, well, on DieHard, it's really a comment on the quarter, the fourth quarter in terms of an investment behind marketing in the fourth quarter, as we said all year. We launched DieHard - as you know, we launched on July the 4th, and the marketing broke on October 18th, three weeks ago. And you're going to see heavy advertising on DieHard starting again next week. Obviously, we pulled it off, Simeon, for the election weeks. We knew that was going to be pretty cluttered and people will be obviously focused on the election. But starting next week, you'll see our advertising come back and we're really going to hit DieHard hard for several weeks, as we head into the winter season.

So, Jeff can respond to the cash question.

Jeff Shepherd - Executive Vice President, Chief Financial Officer

Yes, in terms of cash, it's still at an elevated level and we did repurchase about $110 million worth of our stock in the third quarter and, Simeon, we're going to continue to be opportunistic there. You've got to be somewhat prudent in terms of the uncertainty of the environment. We're pleased with what we were able to do in the third quarter, and the fourth quarter is going to present new challenges.

So, we are going to try to be opportunistic in terms of repurchasing. We continue with the dividend of $0.25 per share, so we're pleased with that. And as we close out the balance of the year, we're going to maintain that trajectory.

Simeon Gutman - Morgan Stanley - Analyst

Okay. Thank you both.

Tom Greco - President and Chief Executive Officer

Thank you.

Operator

The next question is from Christopher Horvers of JPMorgan.

Christopher Horvers - JPMorgan - Analyst

Thanks. Good morning, everybody. So, I wanted to ask about the topline. You seem to be narrowing the gap versus your competitors. And then you also mentioned mid-single-digit quarter-to-date, which is a strong trend. Others had talked about moderation in October as well. So can you maybe diagnose what is changing from that 10 to the mid-single digit? Is it DIY slowing but commercial relatively constant? And overall, is that - how is that playing out regionally, is the gap between the Northeast and the Mid-Atlantic versus the other areas continuing to narrow?

Tom Greco - President and Chief Executive Officer

Well, first of all, Chris, the gap did narrow meaningfully in the third quarter. We were around 2,000 basis points in the second quarter and we narrowed that to 900. Those particular COVID areas are - heavier areas for COVID are much more challenged with miles driven, and across broader retail you're seeing that - those lower numbers. But we are seeing it narrow and we're excited about the future there. I mean, eventually that's going to come back. The Northeast, Mid-Atlantic regions are big for us. So, we want them to come back.

In terms of the fourth quarter, we've seen a moderation. It's been really more winter-related categories. It's still early. There's lots of time left in the quarter. So, as you know, there can be volatility in the fourth quarter. But overall, we're pleased with our performance quarter-to-date and we're going to continue to execute our plan.

Christopher Horvers - JPMorgan - Analyst

Understood. And then as a follow-up to that, when you talk about winter-related categories, is that more DIY like batteries slowing ahead of the winter? And is that impacting the commercial side of the business?

Tom Greco - President and Chief Executive Officer

Yes, it's more DIY.

Christopher Horvers - JPMorgan - Analyst

Got it. Understood. And then, Jeff, you gave us some good commentary around SG&A for the fourth quarter. So, any comments on gross margin factors that we should consider there? And then as you think about 2021, based on all the initiatives holding comp constant, it would seem like - is it fair to say you would see, sort of, increasing margin expansion over the cadence of 2021 - clearly have to impact for the comparisons on the COVID front, but just on an underlying basis?

Jeff Shepherd - Executive Vice President, Chief Financial Officer

Yes. Yes, couple of things there, Chris. I think for Q4, first of all, as you saw in Q3, we're lapping the coupons, we're lapping the tariffs. We're going to consider - we're going to continue to see that in the fourth quarter. Our supply chain efforts, that is something that as we take out the stem miles, we're going to continue to see those savings. That will continue into the fourth quarter and that will certainly continue into '21. We're obviously not going to give you any guidance around '21, but I think those are some of the factors that we can be looking at.

And then just in terms of overall inflation, I think it'd be the other thing that we've been watching closely. That's been relatively low, certainly in the third quarter. And we don't have any reason to believe we're going to see any significant inflationary factors, at least in the fourth quarter. A little bit early to speculate on '21.

Christopher Horvers - JPMorgan - Analyst

And so just last question, does that mean from like a LIFO on a capitalized inventory cost perspective that - should that remain at this point, you think, relatively neutral in 4Q?

Jeff Shepherd - Executive Vice President, Chief Financial Officer

Yes.

Christopher Horvers - JPMorgan - Analyst

Understood. Thanks. Best of luck.

Tom Greco - President and Chief Executive Officer

Thanks.

Operator

Your next question is from Michael Lasser with UBS.

Michael Lasser - UBS - Analyst

Good morning. Thanks a lot for taking my question. Tom, it seems like some of your operating cost right now are little bit higher than what you had previously expected. It's on the SG&A performance this quarter and next quarter, plus some of the gross margin driving initiatives are taking a little bit longer than what you had previously thought, due in part to COVID. Is the overall margin opportunity that you've long talked about, is the same, equal to, or not as great, or even better than what you had thought previously?

Tom Greco - President and Chief Executive Officer

Yes, it's very much in line, Michael. We are continuing to execute the initiatives that we've spoken about. And as we said at the beginning of the year before and this year, last year and this year were expected to be lower versus 2021, and we continue to expect that overall 2021 will be greater than we delivered in these two years.

So, there's really no change in our approach in the margin expansion initiatives. Some of them have been delayed, as you said. The only major ones are the cross-banner replenishment initiative on supply chain and the warehouse management initiatives. But other than that, we're continuing to execute each one of the initiatives that we have.

Michael Lasser - UBS - Analyst

The SG&A this quarter and next quarter, we should view that as a one-off or temporary, not an indication of more longer-lasting trends?

Tom Greco - President and Chief Executive Officer

Really more this quarter here, fourth quarter as we called out, there are some unique things in the quarter - an investment to launch a new brand, which we're very excited about, and a very important investment to drive awareness of DieHard to make sure that consumers know that the place - the only auto parts store that you can get a DieHard battery is Advance or Carquest, and that's a very important message for us to land. And it's got very - the early returns on what we're doing there are really, really strong in terms of market share.

We also talked about rent. There is some one-time things with rent that we need to go do. And then COVID, obviously, we're ongoing, dealing with COVID. At some point, if there is a vaccine, some of those costs will go away, but those are the things that we called out for the fourth quarter.

Michael Lasser - UBS - Analyst

And you can clarify that on your - on the return that you're getting on the DieHard investments, presumably the slowdown that you experienced quarter-to date have largely been DIY-driven. And it's also quarter-to-date coincided at the time that you launched the new campaign. So, how do you expect the timing and the impact of the return on this DieHard investment to play out? When we - when you expect to see it through better sales in your DIY business?

Tom Greco - President and Chief Executive Officer

Well, we just reported very strong sales in our DIY business and it continues to perform well. It's just relative to the third quarter there has been a softening there. But overall, I mean, marketing investment that we're making to launch our brand that we expect to be a $1 billion brand is not a - you launch the advertising on October 18 and you look for sales increase on the 19th.

We're going to continue to invest behind this brand. It's going to be a multi-year platform for us. It's not just something that we want to launch in batteries. It's going to be in other categories. So, we're going to continue to measure every discrete investment against DieHard, but it's overall designed to drive differentiation for the company and ensure that people come to our stores to buy DieHard.

So, we feel very good about where it is. The advertising has resonated. We've had a significant number of views, impressions, shares. Over time, that's going to be very powerful for us.

Michael Lasser - UBS - Analyst

Thank you very much and good luck.

Operator

Your next question is from Elizabeth Suzuki with Bank of America.

Elizabeth Suzuki - Bank of America - Analyst

Great. Thank you. I guess just continuing on the margin topic compared to last quarter, there was a little less SG&A leverage even though the comp growth was higher. We've heard from some others in the industry that there is a sweet spot for operating leverage in sort of the mid- to- high-single digits, where you can deliver sales growth comfortably without pushing the limits of what your associates and supply chain can manage. Have you found that to be the case as well, where when growth exceeds a certain level, it's harder to get that leverage or do you feel like stronger sales are just always better?

Jeff Shepherd - Executive Vice President, Chief Financial Officer

Well, stronger sales are always better. Yes, there's certainly a sweet spot. It varies. You've got to think about the category mix as well. If - when professional sales recover, that requires more labor. So, it is not as simple as saying revenue is actually our leverage point because of why. You really got to look closely at category mix. We saw the benefit in the second quarter, we saw the benefit in the third quarter.

As professional sales continue to recover, as we anticipate it will, that requires more labor. So, that is a little bit more art than science from that standpoint. Some of the others are more straightforward in terms of the leverage you get on. It's more traditionally fixed categories such as rents, but certainly the higher sales levels do help us.

Elizabeth Suzuki - Bank of America - Analyst

And can you break out and help us quantify some of the puts and takes for margin in the third quarter? I know you mentioned pricing actions and supply chain efficiencies partially offset by the unfavorable product mix. Were there some other factors like the lapping in Speed Perks, lapping in tariffs and channel mix that you can help us quantify some of those puts and takes?

Jeff Shepherd - Executive Vice President, Chief Financial Officer

Yes, you got them right. Pricing and supply chain, both equally benefited the quarter. In terms of price, it's a little bit of everything. We saw slight increases in sort of our POS price. We got a little bit of a benefit in sort of the coupons rebates, so think about Speed Perks. None of them individually meaningful, but they're all going the right way.

And then the other category is what we call [Indecipherable] override, so just controlling the price that we're giving the customer in the store, we saw improvement there.

So, in the pricing category, we saw a little bit of improvement across all of those categories that gave us the larger benefit. Supply chain, as you know we've talked about in terms of getting leverage from the elevated sales; and in addition to that, the work that we're doing to drive out the stem miles.

The one we did call out because we talked about this a little bit in the second quarter, it was mix. And that overall was flat. So we saw improvements in our channel mix that was offset by our product mix.

And then the only other one I would call out is we did see some headwinds associated with the strength in the sectors and that's really timing. I don't expect that to be an ongoing headwind into the fourth quarter, going forward. There was a little bit of favorability that we saw last year, nothing meaningful and we had a little bit of a headwind this year. So, when you compare the two, it exacerbates a little bit. But nothing significant in terms of ongoing problems or ongoing headwinds that we expect to see going forward.

Elizabeth Suzuki - Bank of America - Analyst

Great. Thank you.

Operator

The next question is from Greg Melich with Evercore ISI.

Greg Melich - Evercore ISI - Analyst

Hi. Thanks. I had two questions. One - both follow-ups, I believe. So, if comps slowed in the fourth quarter, is it fair to say that it's been more on the DIY side than the do-it-for-me, given your comments? In other words, did do-it-for-me sort of stayed stable?

And then the second question is, what sort of savings do you get from each DC when WMS is implemented?

Tom Greco - President and Chief Executive Officer

Well, good morning, Greg. First of all, what I'd like to clarify here is we're talking weeks here in the fourth quarter. So, you can see volatility in DIY in weeks frequently, as you know. DIY tends to be a more volatile business as it pertains to weather and things like that, so we have seen more softening in DIY than in Pro. Pro is generally more consistent. COVID changed that a little bit in the second quarter, when things were completely shut down. But over the long term, the Pro business tends to be more stable.

So, I would attribute it far more to that than anything else. I think you're going to continue to see DIY perform well balance of the year into the next year. And the Pro business, as we begin to recover and miles driven starts to come back, you'll see the Pro business come back in particular categories like brakes. I mean, our hard parts business has been very solid on the Pro side of the business - engine management, ride control. We're very happy with our overall performance there. So overall, continued performance on Pro, more consistent. DIY is also performing well.

Your second question, remind me.

Greg Melich - Evercore ISI - Analyst

It's really about learning more about the supply chain savings. So, I think you mentioned four - by the end of year, four of 11 DCs would be converted to WMS?

Tom Greco - President and Chief Executive Officer

Yes, yes.

Greg Melich - Evercore ISI - Analyst

So just trying to frame how much does that help when you - every time you get one converted, dollar amount or bps or margin, how do we think about it?

Tom Greco - President and Chief Executive Officer

Yes, well, first of all, we call those supply chain as one of the largest areas of margin expansion that we have, right? So you've got a couple of territory there. You've got cross-banner, you've got warehouse management systems, you've got execution, and we're also integrating the Worldpac and Autopart International supply chain.

So, those four initiatives ladder up to a significant number as it pertains to margin expansion. We haven't broken out specific on WMS. But what we get there is savings through improved processes across our system and much more rigorous labor management standards.

Reuben Slone, who heads up our supply chain has done a terrific job really driving that agenda. We were in one of our distribution centers yesterday. The performance is improving. We've leveraged it again in the most recent quarter. We're going to leverage again next year and the year after.

So, we're excited about those supply chain initiatives as they build over time. And you're going to start to see the benefit of that as we get into '21 and '22 on a full year basis.

Greg Melich - Evercore ISI - Analyst

Got it. And so when you said one-third along the way on that, that was talking about the four initiatives together, some a little ahead, some a little behind, is that a fair way to think of it?

Tom Greco - President and Chief Executive Officer

Yes, the one-third was related to cross-banner. Well, that's a separate initiative. That's just really pointing stores at a different DC and in that one we're accounting the savings now. I mean, we're starting to see savings breaking out. And we'll finish that job in the third quarter of next year. So, we'll be getting the full benefit of that, Greg, in the fourth quarter of 2021.

Greg Melich - Evercore ISI - Analyst

Got it. All right. Thanks a lot and good luck.

Tom Greco - President and Chief Executive Officer

Thank you.

Operator

Your next question is from Seth Sigman with Credit Suisse.

Seth Sigman - Credit Suisse - Analyst

Hey, guys. Good morning. Thanks for taking the question. You mentioned some regional differences. I'm curious, has that been more pronounced on either the DIY or Pro side? And then just focusing in here on the Pro, I've realized that market share is more difficult to see. But if you could just update us on the progress in terms of gaining share of wallet with your customers and any sort of wins on the new customer front? And I guess, how cross-banner and other initiatives may actually be helping from an execution perspective?

Tom Greco - President and Chief Executive Officer

Yes, well, first of all, we've got a pretty concentrated business on Pro in the Northeast, right, Seth? I mean, it's not just Advance. It's concentrated with our Carquest business, our Worldpac business, our Autopart International business. So as the early stages of the Northeast reaction to COVID happened, that was a pretty significant impact and obviously represents an opportunity for us next year.

That has moderated, as we said. We're gradually starting to see that come back when I phoned our top professional customers, which I do frequently. I do hear that they are starting to see the same thing as us, that you're starting to see things come back certainly in places like Upstate New York and rural Massachusetts. And as the city starts to come back and as DC starts to come back, we'll see that miles driven benefit.

In terms of what we've been doing on the Pro-side, I think Bob Cushing has done a great job leading the big initiatives there, which is to really leverage the assortment of the enterprise. Our Dynamic Assortment initiative is rolled up pretty much across all backroom categories. Now we're seeing improvement in our assortment rate and our close rate. We're definitely seeing improvement in our TechNet business. Our TechNet's really led the way in the quarter. Our strategic accounts are starting to come back. So, we're seeing gradual progress on the Pro business and we expect that to continue as we go into next year and candidly lap some pretty difficult time on the professional side of the house.

Seth Sigman - Credit Suisse - Analyst

Okay, that's helpful. Thank you. And then I think you spoke to more margin expansion expected in FY'21. Just curious, is that more gross margin or SG&A? And then just another clarification. Jeff, the cost you talked about in the fourth quarter, the incremental SG&A, are you able to quantify that for us?

Jeff Shepherd - Executive Vice President, Chief Financial Officer

Yes, in the fourth quarter, we haven't quantified it, but the combination of all those, we anticipate it's going to be meaningful. COVID, you can probably start to model. We had $9 million in the third quarter. We had at $15 million to $16 million in the first and second quarter. So it's going to be somewhere in that range. But we're not seeing - I don't know if vaccine is going to help, but we certainly don't expect a meaningful impact in the fourth quarter. So, that's one of them you can certainly model.

In terms of longer-term margin expansion, we're going to come back in March with some more details. But what I would tell you is we expect to see margin opportunity both in gross margin and SG&A.

Seth Sigman - Credit Suisse - Analyst

Okay. Thanks a lot.

Operator

Your next question is from Scot Ciccarelli with RBC Capital Markets.

Scot Ciccarelli - RBC Capital Markets - Analyst

Good morning, guys. Scot Ciccarelli. So, we heard there is some stress in the supply chain and with product availability for the industry. Can you clarify, kind of what you guys are seeing on your own inventory availability and if shortages have been a challenge or if you feel like you pretty much have the supply chain where you need at this point?

Tom Greco - President and Chief Executive Officer

Sure, Scott. There are some isolated categories. I don't want to specify them, because we've got calls with those particular suppliers coming up. But there are some isolated categories where we see that. In general, we've done pretty well through this thing. I mean, our - we review it every Monday, every Friday. We go through what our fill rates are, where we are versus each stratification of SKUs, AD/DDE [Phonetic]. Generally speaking, our team has done a great job managing through and I think it's been to our advantage, and I think that's why you saw us run double-digit comps in the quarter relative to others. I think that's a very respectable number.

So, we're going to continue to monitor it. But it's - overall, we've done pretty well managing it. And those isolated situations, obviously we have to stay on top of.

Scot Ciccarelli - RBC Capital Markets - Analyst

Got it. Thanks, Tom. And then you did mention private brand penetration increasing. Is that just the addition of DieHard or does it kind of go beyond that? Thanks.

Tom Greco - President and Chief Executive Officer

It's primarily - I mean, really if you think about it, we had an own brand in AutoCraft before, so DieHard is not a change in our own brand penetration with the exception of the fact that we expect to sell a whole lot more than we sold of AutoCraft.

Now, Carquest is a different story. Carquest is a great brand. It's a loved brand by our professional customers, literally over $2 billion in sales. So, we're going to continue to drive that brand and it's very, very popular with our Pro customers. They love it. So, you'll see us continue to drive that. So, look for Carquest.

Scot Ciccarelli - RBC Capital Markets - Analyst

Got it. Thanks, guys.

Operator

Your next question is from Michael Baker with Davidson.

Michael Baker - Davidson - Analyst

Hi, guys. So maybe this is a tough one to answer, but I wanted to just ask about COVID in general and I guess the conundrum is. But the question is, is COVID good or bad for your business? I understand the human cost, of course. But clearly, everyone in the space is comping better than they ever have, yet I think it sounds like in the fourth quarter, as COVID has started to come back a little bit more, you're seeing a slowdown in your business. So, just trying to understand how you think about COVID in general and what's important about that is I guess how you lap against it next year?

Tom Greco - President and Chief Executive Officer

Well, first of all, I think on the professional side, which is 60% of our business, I believe we've got a big opportunity next year. I'll just say that. Clearly, when a garage is shut down and when you've got people staying home, working remote, that's going to have a negative - a net negative impact on the professional business.

Obviously, with the announcement of a vaccine, we don't know the timing or anything pertaining to how quickly we're going to get back in the office and back to work, but ultimately that's going to happen. And when it does, people are going to get back in their cars, are going to commute to work. They're going to go to where they need to go. They're going to get back on a lot of football games and they're going to restaurants and things like that. And that will be good for our business, overall.

Miles driven is a positive for this industry for decades. So, when you've got miles driven that are down, I think that's clearly something that has a drag on the business.

Now, in the case of some of the larger players, I think we benefited a little bit based on our scale. We've got a scaled supply chain, we've got an online portal, we've been able to gain share during this time frame and obviously the trick from here is to hold on to those people that we picked up, and that's where we're focused on right now and we do that through our loyalty program and through other personalization engagement.

So, that's how would I explain it, Scott.

Michael Baker - Davidson - Analyst

Interesting. It's Mike. And so, you think it's as much of anything of a share gain rather than the overall industry trends benefited from COVID.

One follow-up, on - in the fourth quarter, you talked about a slowing down a little bit and more in the Northeast, I guess. I'm little confused, was that - is that more because COVID has come back in the Northeast or more because the Northeast is impacted by the weather? Or is it a little bit of both?

Tom Greco - President and Chief Executive Officer

Yes. No, I spoke about the Northeast recovering. I mean, there's really no regional trends that we spoke to in the fourth quarter, so it's overall, yes.

Michael Baker - Davidson - Analyst

Okay. Thanks for that clarification. That's helpful. Appreciate that.

Tom Greco - President and Chief Executive Officer

Just to make sure, Mike, I think your point is right. The gain - the share gains that we've experienced, I would say the larger players, have not necessarily reflected the overall industry. If you look at the industry numbers, the industry is not calling for the business to be up this year, overall. I mean it's calling for it to be slightly down. So, I do think the scale players benefited during this, but I'm not sure the auto part aftermarket was an overall beneficiary, like other sectors.

Michael Baker - Davidson - Analyst

Okay. I appreciate those comments. Thank you.

Operator

Your next question is from Bret Jordan with Jefferies.

Bret Jordan - Jefferies - Analyst

Hey. Good morning, guys.

Tom Greco - President and Chief Executive Officer

Good morning.

Bret Jordan - Jefferies - Analyst

Talking about sort of evaluating the real estate footprint, in that you're seeing some SG&A expense on lease terminations in the fourth quarter. How many stores are you looking at as far as closures going, I guess into the end of this year and beginning of next year?

Jeff Shepherd - Executive Vice President, Chief Financial Officer

First of all, we're looking at our entire profile of real estate, so it is not necessarily stores. We're also looking at some of our back office. We have field offices throughout the country, so we're really looking at the entire real estate portfolio, kind of the CSD, corporate support, we're looking at that. We are looking at the number of stores. We haven't broken that out. Obviously, it impacts our team members, so we haven't given any more specificity around that.

But we're really just looking across our portfolio. And anything that's underperforming, and it does - again, doesn't have to be a store. We're just looking at that entire portfolio to say - okay, do we really need this? One of the things that we've learned during this pandemic is the amount of corporate real estate you needed prior to COVID is much different in a COVID environment. We can work remotely.

And so, as Tom have mentioned, putting everything through a post-COVID lens, that's what we're doing with our real estate.

Bret Jordan - Jefferies - Analyst

Okay, another question on DieHard. I guess could you give us more, I guess, granularity as far as the share gain you've seen since the launch in July? And then maybe the product extensions as you lever some of the spending around the brand, what's the timing that we should expect as far as seeing incremental product available under that label?

Tom Greco - President and Chief Executive Officer

Well, first of all, on the share gains, we've had something like 30 consecutive weeks here now of overall share gains inside of DIY omni channel, which is what we can see right through the syndicated data. It definitely accelerated beyond the launch of DieHard. We're not going to break it out specifically, but we can see the absolute market share and the year-over-year share gain behind the launch. Obviously, we can't see anything from the most recent period, so we're not clear on the benefit on the advertising yet, but we'll see that at some point and we'll continue to iterate. But this is terrific brand. Our organization is so excited about it, I think we - our field team and the entire merchants, supply chain, you're talking about a change that was close to 1 million stores due combinations that we executed flawlessly heading into the July 4th weekend. On July 4th week, we were in distribution everywhere and we were able to drive that over the last several months and into the October 18th launch of the advertising, which all hit exactly when we expected it to.

In terms of extensions, right now we're focused on batteries, very focused on driving market share in batteries, battery accessories. We have ideas around other things that we can do there, but we want to do the job really well on batteries for a period of time and more to come on expansions.

Bret Jordan - Jefferies - Analyst

Okay. And I guess to that question, you commented on building out your own brand exposure. Could you talk about sort of where you are and where you think you can get as percentage of your revenues coming from own brand?

Tom Greco - President and Chief Executive Officer

Yes, it's a pretty big number. Obviously, we've got - we've got couple of thousand SKUs out there now that have been launched in the last year and we have a plan to increase that substantially over the next three years.

So, that's really the plan and it's gradual. I mean, you're talking about exiting certain products and certain categories and transitioning them through the supply chain. So, once we do that, we will see the full benefit of this. But early performance in terms of when we get the Carquest SKU in there, it's often at a more attractive price. It's at a higher margin. Our customers are choosing that brand, and they like that brand. As I said earlier, our professional customers are very comfortable with the Carquest brand. We've had a strong brake program for a number of years and it's just a matter of extending that into some other categories.

Bret Jordan - Jefferies - Analyst

Okay, thank you.

Operator

Your next question is from Chris Bottiglieri with Exane BNP Paribas.

Chris Bottiglieri - Exane BNP Paribas - Analyst

Hey, guys. Thanks for taking the questions. So I guess the first question I had was on the SG&A. Obviously, like very good overall rate improvement. But just wanted to get sense for the SG&A per square foot or dollar growth. Like, what were like some of the discrete items that drove that 6% or so increase? Was it just labor matching up with the higher sales productivity? Was it - was it just - I know DieHard is more of a Q4 event, but were there like DieHard start-up costs? Anything you can frame for us, on discreet items that - and do those discrete items continue into Q4 and into front half 2021?

Jeff Shepherd - Executive Vice President, Chief Financial Officer

Yes, you actually got it right. It's really payroll, in terms of the dollar investment that we had. Just again, speaking in terms of some of the professional payroll dollars and just getting some of the needed payroll back into the stores, we are running very thin in the second quarter and it just wasn't going to be sustainable for some of that payroll that was needed to get back in there due to normal cleaning - forget closet for a second, but the normal cleaning and restocking and everything else we need to do at the store. So, it was primarily payables.

Chris Bottiglieri - Exane BNP Paribas - Analyst

Yes, okay. And then, as I heard, it seems really cool, what's the - like, when you think about that, you mentioned earlier it's of years, not months. But like typically for the type of - this type of marketing campaign, what's the payback period that you would expect to realize in investment of this type? Are we talking months, quarters, weeks? Like, what's typically the sales cadence of a big launch like this and that you've seen historically? And maybe you've never done anything - nothing to the scale, obviously, but any kind of - anyway you could frame would be helpful. Thank you.

Tom Greco - President and Chief Executive Officer

Sure. I mean, first of all, we will measure the performance of each discrete elements of the campaign and measure that against our cost per incremental dollar metrics that we have. And our marketing investment this year has proven to be very effective in that regard and much better than our historical rates. So, we will continue to measure that and when we obviously have the enough time, Chris, to measure the performance against this particular advertising, we'll look at that very clearly.

The reference to years is we're talking about building a brand that's over $1 billion. So, that takes a sustained investment over time. We're not talking about year-on-year increases necessarily in marketing in 2021 and '22. We're talking about a quarterly increase in the fourth quarter to get the brand launched and being smart about how we spend our marketing dollars next year.

So overall, the profile of this is to create differentiation for our brand to drive traffic to our stores to really make sure that people know that we're a destination for DieHard batteries, and that requires an investment and a sustained investment.

Chris Bottiglieri - Exane BNP Paribas - Analyst

That's helpful. And then just one final clarification question. The big picture for DieHard is essentially that you're going to replace your old brand, the AutoCraft or whatever its called. So, like for every SKU that there was an AutoCraft brand, you're going to have a DieHard SKU now? And then, do you foresee like higher pricing power with DieHard? Like, for the same SKU, would you charge more for DieHard or do it at the same price? Is it more like a traffic play or is it also a margin play?

Tom Greco - President and Chief Executive Officer

It's really both. I mean, we're looking very carefully at that and have already taken some actions to strengthen the margin profile of our batteries already. So, there is a couple of things that we're doing there that we're pretty excited about that can drive margin, and already have. So, you're going to continue to see not only topline benefit, but gross margin benefit there.

Chris Bottiglieri - Exane BNP Paribas - Analyst

Okay, great. Thanks for the questions. Appreciate it.

Operator

Your next question is from Seth Basham with Wedbush.

Seth Basham - Wedbush - Analyst

Thanks a lot, and good morning. My first question is just diving a little bit deeper into cross-banner replenishment. You guys are seeing some benefits to gross margin from that now on a net basis. As we look forward, should we be thinking about that net benefit growing as you convert more to cross-banner replenishment?

Tom Greco - President and Chief Executive Officer

Absolutely. Obviously, the more stores you have, the better it is. The good thing, Seth, with this is we were able to identify new buildings now that can potentially accommodate some of these changes based on capacity moves and some of the additional analysis we've done. So, we've got the initial savings that we modeled. Pretty confident we'll be able to put that in the bank by the end of the third quarter, as we said earlier. And now there is some additional stores that we're going to add beyond that. But every time we convert a store, we take miles out. And literally the plan is for millions of miles to come out of the system, and that obviously saves you on a rate basis per month.

Seth Basham - Wedbush - Analyst

Got it. That's helpful. And then secondly, thinking about your store portfolio, you guys are re-evaluating likelier renegotiation rent per store as well as other real estate next quarter. But as we think about the portfolio at large, do you think there's going to be material reduction in the number of stores you're operating or are you just setting the base to resume growth?

Jeff Shepherd - Executive Vice President, Chief Financial Officer

We're not anticipating a material reduction. We closed about 50 stores in the first half of the year. In the third quarter, it was like hand full 10 or 12. We've taken out most of our - nearly all of our structural issues in terms of stores, stores across the street from each other, less than a mile apart, just in the wrong geographic location within a market, that what we've been doing the last several years. And so again, the real estate is a much broader initiative. We do have some stores that we've recently closed that are closed, but we're still paying the rent. We call them Dark Stores. And we're getting out of those.

And really what that does is it sets us up for '21. And once you stop paying that rent, it's an immediate benefit. And so, we're looking at that, we're looking at the field offices, we're looking at our corporate location and just making sure we have the correct footprint. So, I don't anticipate this to have a meaningful impact on our stores.

We're always going to be closing a few stores here and there, but we're done with that. And we're going to be looking strategically at stores that we can start to open, so that's sort of the plan going forward into '21.

Seth Basham - Wedbush - Analyst

Understood. Just to put some numbers around it, Jeff, I know you're not providing guidance. But if you were to maintain the gigantic comps, would expect to still be able to leverage SG&A despite some of these headwinds associated with the advertising as well as the lease buy outs?

Jeff Shepherd - Executive Vice President, Chief Financial Officer

Are you talking specifically in the fourth quarter?

Seth Basham - Wedbush - Analyst

Yes.

Jeff Shepherd - Executive Vice President, Chief Financial Officer

Yes, I think we could.

Seth Basham - Wedbush - Analyst

Excellent. Thank you very much.

Operator

There are no further questions at this time, I will now turn the call back to Tom Greco, for closing remarks.

Tom Greco - President and Chief Executive Officer

Well, thanks to everyone for joining us. As you've heard today, we continue to improve execution across Advance and we're proud of how our team has responded throughout this unprecedented time.

We believe the next few months for our country will continue to have its challenges, but we're confident that we're taking the necessary steps towards the health, safety and well-being of our team members and customers while helping to make AAP even stronger.

Before we conclude the call, I want to take a moment to thank all of our veterans from each branch of the military for their service, including the thousands of Advance team members who previously served. We are honored to continue partnering with several organizations to recruit and support current and former service members, including Building Homes for Heroes. I've personally seen the impact that this organization has had on families and I'm proud of the impact and our commitment to continue supporting these important initiatives in the years to come.

Once again, thanks for joining us today and we look forward to sharing our Q4 results with you in February.

Operator

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Q3 2020

Earnings Transcript

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