Mike Smargiassi - Investor Relations, Brainerd Communications Richard Leeds - Chairman and Chief Executive Officer Larry Reinhold - Executive Vice President and Chief Financial Officer

Good day and welcome to the Systemax Fourth Quarter 2015 Conference Call. [Operator Instructions] I would now like to turn the conference over to Mr. Mike Smargiassi of Brainerd Communications. Mr. Smargiassi, the floor is yours sir.

Thank you and welcome to the Systemax fourth quarter 2015 earnings call. Today’s call has been pre-recorded and will include formal remarks from Richard Leeds, Chairman and Chief Executive Officer of Systemax and Larry Reinhold, Executive Vice President and Chief Financial Officer. We will not be hosting a live Q&A session at the end of today’s call. If you should have any questions on fourth quarter results, please contact Brainerd Communicators or Systemax. Contact details can be found on the press release issued today and at www.systemax.com. Today’s discussion may include certain forward-looking statements. It should be understood that actual results could differ materially from those projected due to a number of factors, including those described under the forward-looking statements caption in the company’s Annual Report on Form 10-K and quarterly reports on Form 10-Q. I would like to highlight the non-GAAP metrics that are included in today’s press release. The company believes that presenting the entire North American technology products group as a discontinued operation and excluding certain recurring and non-recurring adjustments from comparable GAAP measures, investors have an additional meaningful measurement of the company’s performance. Larry will expand on this in his introductory remarks. As a result, this call will include a discussion of certain non-GAAP financial measures. The company has provided a reconciliation of these non-GAAP financial measures to their most directly comparable GAAP measures in today’s press release. The press release is available on the company’s website and will be filed with the SEC and on Form 8-K. This call is the property of and is copyrighted by Systemax Inc. I will now turn the call over to Mr. Richard Leeds.

Good afternoon and thank you for joining us today. During the fourth quarter, we announced the strategic exit of our North American technology business. This transformative event will significantly improve our consolidated financial performance and profitability and allows us to sharpen our focus on driving the value of our two remaining businesses. The exit process in North American tech, include the sale of certain assets and the winding down of remaining operations. I am happy to report the exit of those operations is largely complete. Larry will provide a full update on the details as well as address the impact of the exit on our financial reporting in a moment. As a result of this strategic decision, Systemax today operates two value-added B2B distribution businesses, an industrial MRO business, serving the North America market and an IT products and services business serving EMEA. We believe both of these businesses have opportunities for organic growth and select M&A. To better position them for the future, over the past several years, we have strengthened and built out their infrastructures, improve operating efficiencies, expanded their products and service offerings and enhanced customer service level. Our industrial products group continues to deliver strong performance and for the full year, it generated almost $700 million in revenue, up 26% from the prior year. Our revenue growth was driven by the addition of the Plant Equipment Group, or PEG, as well as double-digit organic growth, which continues to significantly outpace the general MRO industry. Industrial enters 2016 positioned to benefit from the investments and efforts of the past year. PEG has been fully integrated in our co-branding initiative to allow us to leverage the power of our brands and enhance our recognition in the marketplace have been well-received by our customers. With the recent opening of…

Thank you, Richard. I am honored by the confidence both you and the Board have placed in me. Systemax is a great company, with a strong management team and dedicated employees. It’s an exciting time at the company and we have numerous opportunities in front of us. I would like to thank you for the leadership, dedication and mentoring that you have provided as CEO and I look forward to continuing our work together to the benefit of our customers, employees and shareholders. The first thing I want to address today is the presentation of NA Tech in our consolidated financial reporting. I believe the non-GAAP presentation of financial results, which I will explain in a moment, is a more meaningful presentation for our investors than the GAAP presentation. As you know, in November, we announced the decision to sell most of NA Tech to PCM and to wind down the remaining operations to fully exit the business as soon as possible. A substantial portion of NA Tech was its retail operations, which peaked at 42 stores in 2011. During 2012 and through the first half of 2015, 39 of these stores were closed, leaving 3 stores in operation at the time of the PCM announcement. Those 3 stores were closed during January 2016. The U.S. GAAP rules for discontinued operations changed effective January 1, 2015. These revised rules mandate that, because the 39 stores have been closed prior to the PCM announcement, their historical results along with allocations of shared distribution and back office costs must be presented as part of continuing operations for U.S. GAAP. This counterintuitive presentation results in 2015 full year GAAP continuing operations, including about $98 million of revenues and $42 million of net losses, which were incurred by the discontinued NA Tech business. We…