W.W. Grainger, Inc.

Greetings and welcome to the WW Granger first quarter 2026 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Kyle Bland, Vice President of Investor Relations. Thank you. You may begin.

Good morning. Welcome to Grainger's first quarter 2026 earnings call. With me are DJ McPherson, Chairman and CEO, and Dee Merriweather, Senior Vice President and CFO. As a reminder, some of our comments today may include forward-looking statements that are subject to various risks and uncertainties. Additional information regarding factors that could cause actual results to differ materially is included in the company's most recent Form 8K and other periodic reports filed with the SEC. This morning's call includes non-GAAP financial measures, which reflect certain adjustments in previous periods as noted in the presentation. There were no adjusting items in the first quarter, 2026 period. We have also included organic revenue adjustments in the presentation, which normalized sales growth to reflect our exit from the UK market, including the Cromwell Divestiture and the closure of Zorro UK, both of which are completed in the fourth quarter, 2025. Definitions and full reconciliations of our non-GAAP financial measures with their corresponding GAAP measures are found in the tables at the end of this presentation and in our earnings release, both of which are available on our IR website. We'll also share results related to Monotaro. Please remember that Monotaro is a public company and follows Japanese GAAP, which differs from U.S. GAAP and is reported in our results one month in arrears. As a result, the numbers discussed will differ from Monotaro's public statements. Now I'll turn it over to DG.

Thanks, Kyle. Good morning, everyone, and thank you for joining today. We're off to a strong start in 2026 with both our business segments performing well. Despite the ongoing tariff uncertainty and the broader geopolitical climate, we are encouraged by the positive signals we're seeing in the demand environment. By staying focused on what we can control, we continue to drive performance through solid execution and by consistently delivering value to our customers. I had the opportunity to experience this firsthand on a recent visit with a major agricultural customer. While many of our large customers are complex, our approach is simple. Start with the customer, stay curious about how their operation works, and then bring our full suite of capabilities to solve their MRO challenges end-to-end. What differentiated Grainger with this customer and with other contract customers where we are seeing growth is our ability to deliver highly coordinated capabilities beyond the products themselves. That same coordinated approach is on display at our most recent Grainger sales meeting in March. This event showcased the breadth of our products, services, and solutions. With more than 10,000 customer, supplier, and team member attendees, the event demonstrated the power of listening, asking good questions, and staying focused on the problem the customer is trying to solve. We invest in this meeting because it results in stronger teams, stronger partnerships, and ultimately improved performance. Earning trust and building strong relationships is also at the core of how we approach our workplace and culture. While awards aren't the goal, they serve as useful signals that we're executing the right way. In recent weeks, Grainger was once again recognized as a top workplace, this time being named one of the Fortune 100 Best Companies to Work For and a 2026 Platinum Employer on the Where You Work Matters list, which is powered by the American Opportunity Index. We don't take this recognition like this for granted, and we're proud that it reflects the experiences we create for team members and the outcomes we deliver to our stakeholders. On the subject of team members, you may have seen that several of our senior leaders recently took on new roles within the organization. We are fortunate to have a broad and deep set of leaders at Grainger, a clear strategy, and high performing company. Having such a strong foundation allows us to provide leaders with new experiences to develop for the future. Now moving to Q1 results, we delivered a strong quarter of profitable growth, meaningfully outpacing the expectations we communicated for the company back in February. Results benefited from healthy price realization, strong operational execution across both segments, and improved market demand. The broader MRO market showed positive momentum as we moved through the quarter and appears to have sustained that strength in April. At the same time, our high-touch growth engines are gaining traction, and the EA segment is continuing to power the flywheel. Total company reported sales for the quarter were up 10.1% or 12.2% on a daily organic constant currency basis. Operating margin was strong at 16.7%, and diluted EPS finished the quarter up over 18%. Operating cash flow came in at $739 million, which allowed us to return a total of $345 million to Granger shareholders through dividends and share repurchases. I also want to mention that we recently announced a 10% increase to our quarterly dividend, marking the 55th consecutive year of dividend increases. This reflects our continued commitment to returning cash to shareholders through a balanced and return-focused approach. Overall, the quarter finished ahead of expectations, and we are increasing our 2026 guidance to reflect the strong start and continued momentum we are seeing. I will now turn it over to Dee.