Bob KellerThank you, Jennifer, and good morning everyone. Our first quarter net sales were essentially flat on a year-to-year basis on a volume decline of 4%. Including cost related to the rationalization of our European business, earnings from continuing operations were negative $0.04 per share. Excluding those costs, earnings were positive, $0.01 per share. We remain on track to meet our financial objectives for the year. During the first quarter, several of our customers bought less than their point of sale. Most take advantage of our improved supply chain performance and the sell-through of their year-end purchases. The combined impact in the first quarter was a little over $14 million in sales. By the end of the quarter, those customers were largely back to normal replenishment. The underlying demand for our products has not changed, and we remain confident in our ability to grow our business this year. In fact, we committed an incremental $1 million in the first quarter to support resets of our durable products: staplers, boards, trimmers, binding and laminating machines, and shredders to help better position our customers to sell more of our products. We remain pleased with the help of our customer relationships and continue to work hard to be a better partner to them. On our last call, we highlighted 2 areas of the business, where we needed to improve our performance: Europe and our Print Finishing Solutions business. We took the actions we had planned for the first quarter in both businesses and continue to expect them to deliver substantially improved results this year. On the pricing side, we implemented increases in January in the U.S. and Europe to recover some of the increased commodity cost, which we've incurred since mid-2010. We've already committed additional price increases for July in those locations, as a result of continued commodity cost inflation, specifically, in fuel, plastics and steel.
On balance, we exited the first quarter where we needed to be in order to deliver the year. Our customer relationships are strong, and the underlying demand for our products is in line with our expectations. Our inventories and accounts receivable are a bit higher than they should be, and we'll address that. Our recovery plan in Europe and our Print Finishing Solutions business are on track, and we continue to like how we're positioned competitively.At this point, I'll turn the call over to Neal for a more detailed look at our results. Neal? Neal Fenwick Thank you, Bob. Our first quarter performance is recapped on Slide 4. Reported sales were roughly even with the prior quarter. Foreign exchange translation added 3%. Pricing was favorable 1%. Underlying volumes declined 4%, primarily, due to customer inventory reductions and the impact of the fourth quarter buy forward. EBITDA was $25.5 million, including the impact of $3.9 million of costs in the quarter from the rationalization of our European business. EBITDA also included $1.7 million of benefits from foreign exchange translation. EPS from continuing operations was a $0.04 loss, using a 30% tax rate and including the one-time costs. Excluding the cost in Europe, earnings per share would've been positive $0.01 versus the comparable $0.03 in the prior year quarter. Our gross profit margin declined 30 basis points to 30.3% as shown on Slide 5. Decline was due to sales mix and FX translation, which had a 50 basis points impact. In addition, the continued flow-through of higher costs above the current realized value of price increases had a 20 basis point impact. Cost reduction, such as improvement in freight and distribution costs help mitigate the impact of these factors. SG&A expenses increased 200 basis points, primarily due to $3.9 million or 120 basis points of costs in Europe. Excluding these costs, SG&A was up 3%. The primary drivers behind the underlying increase were incentive compensation accruals and deleveraging due to lower sales volume. In all, operating income decreased 32%, including the cost in Europe, and operating margin declined to 4.7% from 6.9%. Excluding the severance costs in Europe, operating margin would have been 6%. Read the rest of this transcript for free on seekingalpha.com