Global Industrial Company

Good afternoon, ladies and gentlemen, and welcome to the Global Industrials' fourth quarter 2023 earnings call. At this time, I would like to turn the call over to Mike Smarjasi of the Plunkett Group. Please go ahead.

Thank you, and welcome to the Global Industrial fourth quarter 2023 earnings call. Leading today's call will be Barry Litwin, Chief Executive Officer, and Tex Clark, Senior Vice President and Chief Financial Officer. Formal remarks will be followed by a question and answer session. During the call, we will reference both GAAP and organic metrics. Organic reflects the performance of the global industrial business exclusive of the May 2023 end-off acquisition. 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 captioned and under risk factors in the company's annual report on Form 10-K and quarterly reports on Form 10-Q. The press release is available on the company's website and has been filed with the SEC on a Form 8-K. This calls the property of Global Industrial Company. I will now turn the call over to Barry Litwin.

Thanks, Mike. Good afternoon, everyone, and thank you for joining us. In 2023, we continue to execute against our ACE strategy. Revenue reached a record $1.27 billion as we benefited from the acquisition of EndOff, while organic revenue performance reflects the soft start to the year. We enter 2023 with an uncertain economic outlook, cautious customer purchasing behavior, and deflationary pricing. As we move through the year, the demand environment improved, pricing pressures eased, and we delivered solid second half results, growing organic revenue 4%. In fact, Q4 produced our best top line growth of the year. Total revenue was $320 million, an increase of 22.9% year over year. On an organic basis, we posted our second consecutive quarter of growth as revenue improved 5.1%. These gains reflect continued volume improvement and strength in our e-commerce channel. Gross margin was 33.8%, a 100 basis point uptick on a sequential quarter basis. We ended the year with a modest increase in our cash position. Even after fully funding the $72 million Indolf acquisitions, Given the strong cash flow generation of the business, today we announced a 25% increase in the quarterly recurring dividend to 25 cents a share, the eighth consecutive annual increase. Looking back at 2023, I'm really proud of how our entire team executed against the key pillars of our customer-centric strategy, from distribution, web, marketing, and sales to merchandising and customer service. Across the company, we advanced operational excellence and strengthened our long-term competitive position. We expanded our go-to-market channels with the addition of INDOF, made enhancements to the user experience in our e-commerce platform, which helped drive web performance and grew the enterprise offering while making investments in sales resources to support both new and existing customers. We remain committed to making the investments that will drive our future performance. As we look to build upon the progress of last year, we have a number of customer-focused initiatives to ensure we further enhance the buying experience and take care of our customers at every part of their journey. First, we'll continue to elevate Global Industrial's ability to solve problems for customers and bring a more comprehensive solutions-based approach to our offering. Internally, we look to be solutioneers for our customers, delivering product content, support, and knowledge to help them make informed decisions and succeed. We are enhancing product training for our subject matter experts and leveraging INDOF's project management and installation capabilities to expand the service offering. And through our voice and customer feedback process, we will drive alignment of these efforts with the needs and solutions customers are looking for. Second, we'll prioritize a renewed focus on the quality and value we provide. From the extra chip in the cookie we deliver through Global Industrials exclusive brands, to a new quality team to evaluate, improve, and monitor our processes. We will emphasize quality of the buying experience every step of the way, from product sourcing to delivery to the customer. We will also fine tune our product assortment to ensure we have the right selection of core products and complimentary consumables for our customers. With these initiatives, we're improving the quality of our offering and highlighting the value we bring to market. Third, it is our aim to make it even easier to do business with Global Industrial. You have heard us talk about providing an exceptional end-to-end shopping experience that delivers a frictionless transaction. We have several ongoing efforts to improve category merchandising and drive shop ability and a new customer service agent training program, all designed to deliver a five-star experience. Finally, we are making further investments in sales, marketing, and profit performance areas to improve the tools and the team we have to grow, retain, and deepen customer relationships. This includes technology investment to drive efficiencies in sales, optimize digital marketing, and enhance pricing intelligence and analytics. As we enter 2024, I believe we have the right plan in place to build upon the progress of last year. Initiatives across the business are designed to elevate and highlight Global Industrial's position as an indispensable business partner and the value we bring every day to our customers. Investment and key performance areas are designed to strengthen our competitive position, drive operational efficiencies, and help us capture share. The market environment remains one of caution, and we have seen modest organic growth to start the year. With strong cash flow from operations and an exceptional balance sheet, we remain well positioned to execute on our strategy, invest in our growth drivers, evaluate strategic opportunities, and build long-term value for our stakeholders. I'll now turn the call over to Tex.