Good afternoon, ladies and gentlemen, and welcome to Systemax Inc.'s First Quarter 2019 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] At this time, I would now like to turn the call over to Mike Smargiassi of The Plunkett Group. Please go ahead.

Thank you, and welcome to the Systemax first quarter 2019 earnings call. Today's call will include formal remarks from Barry Litwin, Chief Executive Officer; and Tex Clark, 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 the results, please contact The Plunkett Group or Systemax. Contact details can be found in the press release issued today and at 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 and under Risk Factors 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 by excluding certain recurring and nonrecurring adjustments from comparable GAAP measures, investors have an additional meaningful measurement of the company's performance. This call will include a discussion of certain non-GAAP financial measures, which we will identify as such. The company has provided a reconciliation of these non-GAAP financial measures to their most directly comparable GAAP measures in today's discussion and press release. The press release is available on the company's website and will be filed with the SEC in a Form 8-K. This call is the property of and is copyrighted by Systemax Inc. I will now turn the call over to Mr. Barry Litwin.

Thanks, Mike. Good afternoon, everyone, and thank you for joining us today. Systemax delivered an excellent financial performance in the first quarter. Revenue achieved $232 million with average daily sales increasing 9.6%. We also generated strong operating leverage from current operations with the expansion of gross and operating margins, delivering a 19% improvement in operating income and an impressive 27% improvement in non-GAAP operating income. This in turn provided strong cash flow generation in the quarter. On the year-end call in February, we outlined our strategy and multi-year roadmap, which included six core areas we believe we can win. These are, delivering a differentiated customer experience; offering innovative branded and private label products; providing rich MRO knowledge and technical expertise; driving operational excellence; propelling financial, talent and technology innovation; and pursuing potential acquisitions to drive synergies and expand capacity, customers and product growth. We have launched a number of new initiatives in support of these areas and are pleased with the initial progress as we look to grow customer engagement and champion a stronger customer-centric culture across every facet of the company. The actions we are taking are specifically designed to accelerate our customers' experience. Our customers' experience is starting to improve as we enhance service levels in our distribution network and call center operations. We are providing customers with greater visibility on product shipping status and driving improved same-day shipment performance in coordination with our logistics partners. These successes highlight increased efficiencies in the distribution network and are allowing us to provide greater end-to-end transaction transparency. We are seeing growth of our managed sales channel and increased sales efficiency gains, which are being driven by our continuous training initiatives. This includes better tools and deeper product knowledge that are increasing the selling efficiency and value proposition of our high…

Thank you, Barry. I will now address our performance in more detail and would like to note that we have moved to a single reporting segment reflecting our strategic focus on the industrial business and that we had one additional selling day in Canada in the first quarter of 2019 versus the year ago period due to the later Easter holiday this year. In the first quarter, revenue increased 9.4% on a GAAP basis and 9.6% on an average daily sales constant-currency basis over Q1 of last year. Revenue was $232 million with growth in the U.S. of 9.3%, while Canada delivered its ninth consecutive quarter of strong double-digit gains, generating revenue growth of more than 17% in local currency. We did see a modest benefit in the period as the weekend leading into the Easter holiday fell in the second quarter this year versus the first quarter of 2018. Revenue performance remained broad-based across product categories with growth led by newer product lines while we are investing in subject matter expertise, sales training and an expanding offering. We also had growth across sales channels, specifically managed sales, where we continue to benefit from sales productivity gains and training initiatives. Gross profit for the quarter increased to $80.3 million, up from $72.5 million last year. Gross margin was 34.6%, an expansion of 40 basis points from the prior year, reflecting continued positive product margin, which benefited from price capture and product mix. In addition, freight margin improved sequentially compared to Q4 from better overall shipping performance in our distribution network and the lifting of ocean freight surcharges in January. Selling, distribution and administrative spending for the quarter was $67.1 million or 28.9% of sales. This spend level included $600,000 of executive separation and transition expense. Excluding those expenses, SD&A [ph]…

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