W.W. Grainger, Inc.

Greetings and welcome to the WW Grainger second 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, 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, Investor Relations. Thank you. You may begin.

Good morning. Welcome to Grainger's second quarter 2026 earnings call. With me are D. Jimmy Fiersen, Chairman and CEO, and Dean Merriwether, 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 PIRAC 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 second 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 Zora UK, both of which were 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 will 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 thanks for joining today. Building on our momentum from the start of the year, we delivered strong performance in the second quarter by executing well and delivering exceptional service to customers. Despite ongoing uncertainty, sales remained strong in both the high-touch and endless assortment segments, and core operating profitability was in line with expectations. While the external landscape remains fluid, we're confident in our ability to manage the impact We also saw a continued strength in the demand environment during the period, with most end markets showing acceleration. As I spend time with customers, I can see this playing out in the way we serve them on-site and inside their operations. Recently, I've visited several manufacturing customers where our teams are closely connected to the day-to-day work. We're helping them manage inventory in ways that fit their specific needs, and that is contributing to strong year-over-year growth at these locations. More and more customers are asking us to help them run their operations more efficiently and solve specific challenges, including areas like safety. And one customer or safety expertise was the catalyst for accelerating that partnership. We're also seeing solid growth from our national accounts in both the U.S. and Canada. On Canada specifically, we have seen tremendous improvement over the past several years as it seemed to stay focused on two things, serving customers well and building a stronger, more profitable business. They've made great progress improving service, Resetting their sales force and revamping their website while also diversifying their customer and markets and product offering. These efforts have driven strong sales growth and operating margin recovery to the highest levels we have seen in nearly a decade. Now, turning to our second quarter results. We delivered another quarter of strong growth and profitability. Results benefited from ongoing operational execution across both segments and an improving market, which helped accelerate volume growth in the period. We are pleased with what we are seeing from our high-tech growth engine and from our efforts within the EA segment to continue propelling the flywheel. Total company reported sales for the quarter were up 10.3%, or 13.7% on a daily organic constant currency basis. Operating margin was strong at 16.1%, and diluted EPS finished the quarter up over 20%, inclusive of the impact of IEPA tariff refunds recognized in the period. Operating cash flow came in at $444 million, which allowed us to return a total of $341 million to Grainger shareholders through dividends and share repurchases. Lastly, we are excited to announce that our new Northwest Distribution Center in Oregon began outbound operations in July. This new technology-enabled building gives us another way to get more of the products customers need closer to where and when they need them. Overall, we're encouraged by the progress we've made across the business, and after our strong first-act performance and continuing momentum, we are increasing our outlook for the year. With that, I'll turn it over to Dee for a closer look at our financials from the quarter.