Frank H. Boykin
I would like to remind everyone that our press release and statements we make on this call may include forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995, which are subject to various risk and uncertainties, including, but not limited to, those set forth in our press release and our periodic filings with the Securities and Exchange Commission. This call may include discussion of non-GAAP numbers. You can refer to our Form 8-K and press release at the Investor Information section of our website for a reconciliation of any non-GAAP to GAAP amounts.
Jeffrey S. Lorberbaum
Thank you, Frank. Our first quarter earnings per share were $0.58 as reported, an increase of 38% over 2011 adjusted results due to volume increases, price increases, cost reductions and lower interest expense. Our sales grew by 5% as reported or 6% on a local basis, with year-over-year sales growth for the past 4 quarters. Price increases in the first quarter will offset the material inflation in our current costs in the second period. SG&A improved by 90 basis points as a percent of net sales. During the first quarter, we generated operating income of $72 million, an increase of 14% over 2011. We paid our 2012 bond obligations using our short-term facility at lower interest rates. Standard & Poor's upgraded our credit rating, and Moody's elevated our outlook to positive, reducing our interest rates on our bonds.Our balance sheet remains strong, with our net debt to adjusted EBITDA at historically low levels of 2.2x. We have almost $500 million available for strategic opportunities. In the U.S., our residential categories reflect the generally positive trends in the housing market. The National Association of Home Builders Index is at one of its highest levels since June 2007, with a positive outlook from record low interest rates and increased approvals. The mild winter weather contributed to the strongest existing home sales for the period in 5 years, which support greater remodeling and renovation in this year. Our commercial outlook is for moderate sales growth in line with the AIA Billing Index for commercial construction.