Greetings, and welcome to the XPEL Technologies First Quarter 2016 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host Mr. John Nesbett. Thank you. You may begin.

Good morning and welcome to our conference call to discuss XPEL Technologies’ financial results for 2016 first quarter. On the call today, Ryan Pape, XPEL’s President and Chief Executive Officer, will review the Company’s financial results and provide an overview of business operations and future growth strategies. Immediately after his prepared remarks, we’ll take questions from call participants. Let me take a moment to read the Safe Harbor statement. During the course of this call, we will make certain forward-looking statements regarding XPEL and its business, which may include, but not limited to anticipated use of proceeds from capital transactions, expansion into new markets, and execution of the Company’s growth strategy. Often but not always, forward-looking statements can be identified by the use of words such as planned, is expected, expects, scheduled, intends, contemplates, anticipates, believes, proposes and variations including negative variations of such words and phrases or state that certain actions, events or results may, could, would, might, or will be taken, occur or be achieved. Such statements are based on the current expectations of the management of XPEL. The forward-looking statements and circumstances discussed in this call may not occur by certain specific dates or at all, and could differ materially as a result of known and unknown risks, factors and uncertainties affecting the Company, performance and acceptance of the Company’s products, economic factors, competition, the equity markets generally and many other factors beyond the control of XPEL. Although XPEL has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in the forward-looking statements, there may be other factors that could cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking statement can be guaranteed. Except as required by acceptable securities laws, forward-looking statements speak only as of the date on which they are made and XPEL undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. With that, I will now turn the call over to Ryan Pape. Go ahead, Ryan.

Thanks John. Good morning and welcome to the quarterly earnings call. I trust most of you had a chance to review the first quarter 2016 earnings, which we put out this morning. We’re pleased we had a great start to 2016; revenue growth of 39% for the first quarter to $11.2 million that’s compared to $8.1 million for the prior year and it was a slight increase sequentially compared to the fourth quarter of ‘15. First quarter was slightly stronger than expected. We had absolutely a fantastic last week in March. We give a tremendous credit to our team, both on the sales side but really on the operations side too, because we really moved a lot of products and it was really amazing and great to see. As we’ve seen before, both the months and our quarters can be quite backend loaded. And it’s really interesting thing to see it, and sometime hard to predict, but we’re very pleased with how the quarter turned out. Internationally, we’re happy, both with our distributors and our own operations in the quarter. Canada performed well. UK had a great March. It shows that that operation is really coming together. And we are now selling more -- at least at the end of the quarter more in the UK per month than we did annually, just a short time ago. So, we are very pleased with it. China and Europe overall have large percentage increases over the prior year, just as we would expect. Rest of the world had really more modest increases. So, we’re still seeing some headwinds there, likely due to the currency and other factors we talked about before, but Canada, China, Europe overall really good growth. We still intend to open the Netherlands -- distribution presence beginning in July,…

[Operator Instructions] Your first question Katie Page [ph] from Northwest Management. Please go ahead.

Could you elaborate a little bit more on the window film product and why that’s important and logical for your broader product line product strategy?

Sure. So, I think when you look at the business traditionally, while we have different lines of paint protection film and related products, primarily we are a one product Company; it’s all related to that. So, when you look at our customer base and our customer base is independent installers of products; it is new car dealerships; it is international distributors. More often than not, that’s not the only product that they need. And there is a number of things they need, a number of things they use in their business. And as we look at it, the most common products that they use in addition to paint protection film is window film. And there is a lot of reasons for that; it’s a new car product a lot of times and it’s often sold at the same time. And so, we think as we want to leverage this channel, we leverage the customers we have, which are ultimate the ultimate distribution points, we leverage our infrastructure to sell and distribute and deliver products. You want to take other products in that can fit through all of that with the least resistance and in more efficient manner. And the window film does that. And it’s a large market; it’s an established market. There are leaders in the market but it’s also fairly fractured. And we think we can be very competitive in terms of product and price and performance. And it’s something that a lot of customers I think can get their needs met. We think that they would rather buy from us through our channel for the different benefit that gives them. And so, it’s just a natural and logical fit for that first major extension of the line.

Our next question comes from Jason Hershman, [ph] who is a private investor. Please go ahead.

Let me start off with the question a little bit more about the Tint World. Is this exclusive deal and is the PPF sold into Tint World under their brand or is it under XPEL?

It’s not exclusive; they have another supplier that they can continue to buy from. It’s really at the franchise deal level where they make that decision ultimately. And to that end, it’s incumbent upon us to go and reach out all the franchisees and wind that business. And I’m sorry. What was the second part of your question?

The second question was, if it’s not exclusive, I presume paint protection film you sell can then branded under your XPEL brand [Multiple Speakers].

Correct, yes. It will be branded as XPEL and those franchisees are eligible to be listed on our locator and participate in our marketing activities as they meet those same type of requirements we put on all of our other customers.

And the second question is regarding the changes to your gross margin. Is there any way to estimate how much of the change in the gross margin in Q1 was due to this categorization and how much is due to the other effects including currency and maybe some competitive discounting?

Sure. Yes, ultimately there is; I don’t have a breakdown for you because there is a lot of moving pieces and they don’t all often move together and they vary. The labor component, it’s not insignificant on an annual basis; it could be hundreds of thousands of dollars. So, that is a significant component. But, on a sort of year-over-year basis, I don’t have that comparison for you.

Okay. And finally, the last question with your new CFO and your new controller position. Is there any particular projects or targets you have for efficiency in 2016, any number that you can share with us that you are trying to create from some new efficiency projects?

Sure. I can say I have a lot of numbers I want to hit. I’m not necessarily prepared to share them. And until Barry is on the job a week, I don’t think I will make commitments for him quite yet. But I think that overall, one of the things we are trying to accomplish is to be more structured and do a bit more forecasting and planning type work and make sure that we are hitting those internal objectives and that they are reasonable but objectives. And that has to do with all the things we talked about from SG&A expense to cost of goods type related expenses. And the business is now complex enough that all of these little details matter tremendously; they have a tremendous impact on cash flow and the bottom line. And it’s incumbent upon us to get really good at managing all that to a fine point. And that’s kind of what we’re focused on. And I think as we through that, we’ll have a better sense of what those are and to the extent we could share them. But, right now, they’re on [indiscernible] targets for us to hit and we’ll go for there.

One last question then, and it’s just maybe higher level question, slightly higher level, because it’s my understanding that a number of your distributors are almost tandem out and they order really right when they need it, sometimes overnighting the product, which takes me confuse why there’s so much sale sort of backend loaded in the quarter. Can you just maybe just address that because it seems like it’s a bit of a discrepancy at least to someone who doesn’t know the business as well as you do?

Well, I think it’s absolutely both of those things are true, we know that. And to the extent that they’re both true and they don’t both make sense together, I think there’s still some questions as to why. I would certainly suggest that some of it’s probably self-induced, meaning that we have very aggressive compensation plans for our sales team and they’re on a monthly basis. And so that definitely creates activity at the end of the month. That would be sort of obvious to sort of quarterly loading effect, perhaps that’s the same sort of trend to hit our corporate goals. But, I don’t know. It’s a good question. And I think it’s also a mix of different type of customers. So, you do have a large segment that frequently and small quantities, just in time, but then you have the interplay of these larger distributors that they don’t order, but once a month or maybe once every other month. And I think some of that turns into that sort of distribution throughout the quarter, if you kind of think of it as every couple of month type ordering pattern.

Our next question comes from Andy Preikschat from Edgebrook Partners. Please go ahead.

Ryan, I’m wondering about price increases, have you done any price increases so far this year in U.S. or Canada?

Yes. So, we did a price increase, single-digit percentage price increase in Canada at the beginning of April, and we will be doing a price increase in the U.S. but we’ve not implemented that yet and that’s probably is we get midsummer, mid to late summer, sort of timing on that.

So, we should see perhaps mid-single-digit price increase for Canada, effective April, you say?

Yes, there was price increase in Canada effective April 1.

And then, that takes -- how many that takes to really show up in the financials, I mean 90 days or…

I would say 30 to 60 probably.

I would now like to turn the floor back over to management for any closing remarks.

Thanks. We appreciate the questions. I think we’ve had a great quarter. And we look forward to talking to everybody next time. I appreciate it.