SYX - Earnings call transcript Q1 2019 | Global Industrial Company

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Operator

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.

Mike Smargiassi

Thank you, and welcome to the Systemax first quarter 2019 earnings call. formal Clark, Barry Financial Vice include Officer; Chief Officer. will Tex and President call remarks Litwin, from Executive Today's and Chief

the We Q&A hosting be end at will call. of a today's not session live

metrics adjustments nonrecurring measures, is identify call will Litwin. call has performance. in now turn filed This with will additional release. comparable measurement those of and could include factors, company's press statements. today's should from GAAP that systemax.com. under number Mr. XX-K and Plunkett such. or non-GAAP materially in available caption will Today's include The in highlight differ the over by property The and reconciliation certain measures, discussion Form Form you company a Systemax please recurring a company be that Statements non-GAAP these issued The actual release on press would to Barry release. non-GAAP forward-looking company's is today's details and as Group to Report copyrighted of Risk including X-K. website and have be that I measures the discussion may their Systemax. are on the on If the measures described projected press an in included I results, It questions those of today understood which by a contact most due the release press the the company's on Inc. excluding is reports The to a can and SEC the results call will XX-Q. financial Factors Contact should in Forward-Looking we of believes This quarterly of be provided investors meaningful found Form any from and financial GAAP certain certain the at under like Annual the have discussion comparable directly to

Barry Litwin

million for you X.X%. delivered everyone, performance sales Thanks, first excellent and financial the Mike. joining average thank in an $XXX Systemax increasing us Good afternoon, with achieved daily today. Revenue quarter.

current XX% of We improvement and turn This non-GAAP impressive generation from margins, leverage also generated improvement operating flow strong provided with a strong operating income. income in delivering the gross an XX% operating in in the quarter. cash in and operations operating expansion

talent On the year-end core we MRO technology six expand our products; and we and roadmap, acquisitions areas can offering and label to included technical potential expertise; excellence; and branded knowledge outlined call win. drive pursuing experience; we believe in providing innovation; delivering synergies and are, and propelling product strategy private February, rich These differentiated driving which and customer growth. innovative financial, operational customers capacity, a multi-year

of initiatives look progress the have champion grow engagement in experience. we We customers' to and we pleased facet the our launched customer new number as these support company. of are culture initial with The are designed and specifically accelerate stronger a are taking customer-centric areas a every of actions to across

starting network service call as in levels Our enhance to our customers' center distribution is experience and improve operations. we

coordination visibility transaction the to performance network are and logistics greater with distribution efficiencies highlight and product shipment shipping us customers providing on greater are in status with increased improved We in same-day provide allowing These end-to-end successes driving partners. our transparency.

force. touch our We deeper tools which continuous gains, sales and selling knowledge seeing better that proposition value being high increasing the and initiatives. sales managed are are our sales of efficiency includes growth efficiency increased of and product This channel our are training by driven

additional overall service capacity facility year to half Greater a improve As to serve in shipping with we also to customers, excited area. support I'm provide new future in performance footprint efficiently us look better our second of our to we announce that It closer will This expanding Dallas allow increase distribution be to our distribution center and the customers, be will growth. the will levels. the

be The series strong product hosting we impacts we outstanding everything forward National directly customer the and that on and at on event do highlight and we industry the product vendors Annual value associates, Industrial depth is than of expertise customers of and addition, drive the looking that With and engage In up already a technical our core events long-term performance. This our and agenda, expertise, our and us successfully Trade to signed our in an second show and demonstrations are will vendors our allows showcases Show to more Nashville, August Tennessee. leading to XXX assortment. of vendors efforts experience products provide. X both Global

voice adopting We a of and to every customers' continuous listening level are serve us to at mindset customers will improvement the allow build a greater advantage. company our better that competitive and carefully

key of our are to we the the a and in delivering have support associates strategy. Our experience various initiatives have differentiated customer embraced

we turn engagement leverage, be continue over to As and to operating improve call revenue satisfaction. customer the will to will customer grow I positioned Tex. generate now we higher drive and profitability performance, well deliver

Tex Clark

on you, our Easter that the quarter, to had Thank detail one and in industrial and our lines X.X%, with daily currency. in basis with like additional in in performance versus the average matter period across to year. more basis expertise, led the year Barry. the I note the in strong Easter on would X.X% into this Revenue holiday X.X% of an last quarter of a consecutive business gains, day expanding of was revenue Canada reflecting single generating local over weekend to a modest first the in increased as due XXXX that sales and see revenue in strategic segment and later moved quarter growth we growth GAAP Canada delivered quarter growth sales constant-currency categories address year offering. remained will while the double-digit training newer of Revenue an reporting In the leading investing benefit of period first year. the of QX second more product on a XX% the product first we ago focus selling have quarter holiday performance million fell did its this than are in U.S. the we versus $XXX ninth subject by We XXXX. broad-based now while

benefited We to also and increased continue Gross growth profit specifically managed product an margin from mix. $XX.X sales, million, for productivity year, price benefit capture basis from million XX initiatives. continued which year. sales the the reflecting XX.X%, expansion up of margin, had to points was positive from across and product prior gains last sales Gross where channels, from quarter we $XX.X training

Selling, and of compared freight performance spend level separation overall administrative the executive and addition, lifting for sequentially QX included the freight better $XX.X transition million expense. in to distribution and distribution improved was In network from surcharges ocean sales. shipping margin in January. quarter spending or $XXX,XXX our XX.X% This of of

to prior Excluding as of marketing year. was efficiencies improvement SD&A [ph] a The points primarily spend expenses, [ph] those the XX of sales leverage result from operating improved general basis the SD&A percentage expenses. of improved and in

above as and to second incur start-up cost work certain pleased to have distribution further service additional well generate of will drive lower drive Barry capacity cost the labor other fixed in freight levels costs to improvements the new to as performance, short-term within continue but structure. market our network As DC increases, our we within are to to leverage we certain we believe which In in anticipate we center, needed half we may benefit distribution to cost with and continuing been efficiency move improve our of the noted, our our as year, customers closer this DCs, provide growth.

are and basis, operating points income fall this year. from margin currently $XX.X year quarter. million of in shipping We of expanded commencement XX targeting a was the ago On GAAP operating the basis

of range was a in Excluding Capital an XX.X% was adjustments, Total income operating continuing was a non-GAAP quarter. flow XXXX, margin our first expense recurring approximately of depreciation from of within of being million, new improvement portion rollout million. and Total center This $XX.X distribution cash in free quarter was the to the XX $X nonrecurring reduced million. quarter million expect greater the is $X $X were to capitalized also we for from amortization $XX.X in our for of the first the estimate quarter and point expenditures $X XXXX. X.X%, basis operating In and capital quarter due non-GAAP million. increase expenditures the operations itself. the million lease

Let me our now balance sheet. turn to

to X.X strong current We of sheet with have X. ratio a liquid very and balance the

million $XX our As agreement. million $XXX over working essentially approximately of $XX approximately and capital. we have availability no credit borrowings XX, of equivalents, Further, cash we excess million in had March and of under million $XX cash

and flow assets allows the and return the of sheet new respectively. strategic During of our $XX and shareholders. the corresponding $XX liabilities in and capital strength opportunities, to standard generation to right-of-use implemented million approximately invest lease million, our and recorded lease accounting to M&A our free growth explore cash continue This balance company us quarter,

dividend dividend Board prepared quarterly anticipate As per quarterly This common a a share we result, remarks. and has regular continuing of our $X.XX Directors declared of our of future. concludes stock, in a the

first found Smargiassi in about Thank release contact Systemax earlier please directly. interest for today. Advisor, at on Media and earnings, information earnings continued can XXXX questions Mike quarter the Plunkett our any be Relations Investor have Contact you The If Systemax. or issued Group, you

Operator

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

disconnect. You may now

Global Industrial (GIC) 3 May 192019 Q1 Earnings call transcript