“And assuming rates stay where they are, I expect that to continue as we move through the year.”

In context

“ds sharper price points? Or is there a mix component to that that we should factor in? Barbara Rentler: That's really off of a sharper price point. It wasn't generated by mix. Operator: And the next question is from the line of Chuck Grom with Gordon Haskett. Charles Grom: The merchandise margin had a nice uptick here in the first quarter relative to the last quarter. Can you talk about the drivers? I think you called out freight and then how you're thinking about that line item over the balance of the year? Adam Orvos: Yes. Chuck, this is Adam. So I mentioned the merchandise margin grew by 120 basis points in Q1. Ocean freight was clearly the most impactful component here driving the improvement. Our performance in merc margin was in line with what we embedded in our guidance for Q1. And assuming rates stay where they are, I expect that to continue as we move through the year. Operator: And the next question is from the line of Adrienne Yih with Barclays. Adrienne Yih-Tennant: Barbara, I want to ask you about packaway, the 42% this year versus 43%. First and foremost, it sounds like you believe that your assortment is on trend, and then typically, when there are these kind of late weather breaks to kind of warmer weather across retail, it gives you the opportunity to chase into sort of known winters. Do you feel better about the assortment heading into the second quarter? And then, Adam, or Barbara, with frontline still being very promotional, does that somehow impede the ability to drive maybe higher AURs because the value is not as evident as it may be when frontline is a little bit less promotional? Barbara Rentler: Okay, Adrienne. So let's start with pac”