Please standby. Good morning, ladies and gentlemen. Welcome to the CTI Industries Corporation Announces First Quarter 2015 Financial Results Conference Call. This call is being recorded. This conference may contain forward-looking statements including statements regarding among other things, the company's business strategy and growth strategies -- growth strategy. Expressions which identify forward-looking statements speak only as of the date the statement is made. These forward-looking statements are based largely on the company's expectations and are subject to a number of risks and uncertainties, some of which cannot be predicted or quantified and are beyond their control. Future developments and actual results could differ materially from those set forth in contemplated by or underlying the forward-looking statements. In light of these risks and uncertainties there can be no assurance that the forward-looking information will prove to be accurate. I will now turn the call over to Stephen Merrick, President. Please go ahead, sir.

Good morning, everyone, and thank you for participating in the call. My name is Stephen Merrick. I am the President of CTI and I will be presenting our report with Tim Patterson, our Chief Financial Officer; and Stan Brown, the Director of our Company and Director of Investor Relations. At the conclusion of our report, there will be an opportunity for you to ask any questions you may have. We are off to a good start this year and we are pleased to report strong bottomline results for the first quarter. For the quarter we had net income of $285,000, which represents earnings of $0.09 per share, $0.08 fully diluted. This is more than six times the earnings we generated in the first quarter last year which is $45,000, $0.01 per share. These much improved results are reflected in our financials in a number of different ways, probably the most significant is the improvement in our gross margin rate and our gross margins. In the first quarter last year, our gross margin rate was 23.4%. In the first quarter this year, the gross margin rate jumped to 26.6%. This increase is directly reflected in our gross profit levels, on revenues which were essentially equal the first quarter last year, we generated almost $4 million in gross profit this year, compared to about $3.5 million in gross profit in the first quarter last year. This increase in margins has come about for several reasons. First, in our latex balloon business margins have increased over the past year due to the decline in the cost of raw latex. Second, in general, our cost of raw materials has declined overall as we have seen some improvement in film costs, as well as in raw latex. Third, we are generating more revenue from products,…

Thank you. [Operator Instructions] And I’m showing no questions at this time in the queue. I apologize. There is [Mike Goodrich with C&G Capital] [ph]. Go ahead. Your line is open.

Good morning, gentlemen. I beg you thought you were off the hook. Only kidding. It’s a great quarter, guys. What do you see going forward in the next two and three quarters of CTI? Are you going to continue to cut costs because it sounds like that was a big part of the success in the quarter? Can you give me a little color?

Well, I think that we -- as I said, our focus is going to be both on revenue growth and profitability. We are not going to stop our efforts to grow the business. We do have lots of opportunities for sales growth, both in the vacuum sealing line and in our other product lines. And I think it’s reasonable for us to expect that our sales compared to last year sales will improve over the course of the year. But we also, as you know from our communications and so on, we have worked very hard at rationalizing our costs to the point that we can operate consistently at a profitable level. As we introduced our new product line, our vacuum sealing product line a couple years ago, we got to the point where we were engaged in significant costs and investments related to that line. And so one of the strong efforts that we’ve made is to manage those costs consistent with being profitable and we are going to continue to do that. That’s a very much a focus of ours so that we can maintain profitability.

Okay. Basically, it’s smart growth, right?

I think that would be a good way to think of -- to state it and we are going to do everything we can to meet that standard.

Awesome. Can you also talk a little bit about the direct sales company because I think that’s a new entry for you guys that appears to really be doing a little bit better every single quarter?

Well, it’s a -- we’re engaged through a related company in the direct sale of products to consumers, container products. And that business has grown at a nice pace. And in fact, the first quarter of this year sales were over seven hundred and some thousand dollars for the quarter, up significantly and that operation is profitable. It has enjoyed some fairly rapid growth and we are looking forward to it to being a growing and significant part of our business.

Are you selling CTI products also through that?

Yes. We sell CTI as a supplier to the entity. And so we supply in particular vacuum sealing, the zippered vacuum sealing bags, some travel bags, and some other products that are sold to that business as well as other products that we purchase and supply to them.

Okay. And last question I guess the margins on that business and whether you see the margins as that continues to grow?

Well, the gross margins in that business, the gross margins are quite high. And they are well in excess of the probably double what our overall company margin is. However, that can be a little bit deceiving because in a operation of that kind, you also have higher sales costs and in particular commissions and so on that you pay to the various people, who are selling the product. And so margins are quite high. And the margins in that business have contributed to our increase in margins overall at CTI since we consolidated with them.

Okay. That’s great. That business seems like it’s starting to get some legs.

Yes. I think that’s right.

Awesome. Well, guys, thank you very much again for the time. Great quarter. Keep it going. Obviously, I know you guys are working hard there. So we would like to see little bit in the value of the company at some point and I think that will come if you keep doing well.

We would too.

Well, keep plugging away guys. If you keep earning money like this, the company is going to do well.

Al right. We are going to keep at it.

Thanks.

Thank you, guys. Have a great day.

Thank you.

[Operator Instructions] And I am showing no further questions at this time.

Thank you, everybody. This is Steve Merrick speaking again. We appreciate your participation in the call and your interest. We are pleased to be able to report a good quarter and we are looking forward to strong year this year. Thanks very much. And have a good day.

This does conclude today’s conference call. Thank you for your participation. You may now disconnect.