Sharon A. MaddenThank you, Tricia. Good morning, and thank you for joining us as we report Headwaters' fiscal 2012 Q1 results. Kirk Benson, Headwaters' Chairman and Chief Executive Officer; and Don Newman, Headwaters' Chief Financial Officer, will be conducting this morning along with Bill Gehrmann, who is President of Headwaters Resources and Heavy Construction Materials segment; and Dave Ulmer, who is President of Tapco International. Before we get started on this call this morning, I would like to remind everyone that Headwaters is sponsoring its 10th Annual Investor Day Conference here on Salt Lake City on March 1 and 2. For more information, please feel free to contact me to our corporate office and I would be happy to supply you with additional information. While listening to the call, please remember that certain statements made during the call including statements relating to our expected future business and financial performance, may be considered forward-looking within the meaning of section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended. Forward-looking statements by their very nature address matters that are, to different degrees, uncertain. These uncertainties are described in more detail in Headwaters' annual and quarterly reports filed with the SEC. You can find Headwaters' annual report on Form 10-K, our quarterly report on Form 10-Q and other SEC filings readily available from the SEC website, Headwaters website or directly from the company. I'll now turn the call over to Kirk Benson. Kirk A. Benson Thank you, Sharon. I like to welcome everyone to the conference call this morning. We're happy to report that we've experienced the strongest December quarter since 2008. Gross margins are up 160 basis points and operating expenses are down nearly 9% or 230 basis points lower as a percent of sales.
Adjusted EBITDA increased nearly 50% year-over-year with light building products adjusted EBITDA up by a very healthy 71%. There are 2 major drivers for the improved performance over the prior year. First, we implemented a restructuring plan as part of our continuous improvement efforts, the benefit of which are now flowing through the P&L resulting improvements to gross margins and lower operating expenses. The result is a material improvement in adjusted EBITDA up about $7 million in the quarter resulting in additional free cash flow and improved risk metrics. Second, we're starting to see some sustained support to our top line. Whereas, we've been flat to down for the last 3 years in light building products. We're beginning to see a sign of a slightly improving performance on our revenue line. Albeit at a 5% rate gets the fastest quarterly growth that we've experienced since 2006. Our highlight average operating model result in substantial increases in adjusted EBITDA and free cash flow, as we start to experienced topline growth.So far the weather has favored sales in January and we hope that the trend on the top line will continue into the second quarter. Our trailing 12-month adjusted EBITDA from continuing operations is on track to achieve our guidance range of $85 million to $95 million for fiscal year 2012. And this guidance range is after the sale of the Blue Flint Ethanol facility, and so it is the guidance from our continuing operations. We sold our investment in ethanol for $18.5 million, both reinvest the proceeds and assets to benefit the company freeing up additional cash to pay down our subordinated debt. In the December quarter, we repaid $7.5 million of our 2.5% of our convertible debt and then in January, we followed on with another $7.7 million of debt reduction in our high coupon debt. The combined debt reduction will reduce interest expense on an annualized basis in the amount of $1.3 million. Our total interest expense reduction over the last year is now in excess of $11 million annually.
We're excited about the first quarter results. It's a great start to the year and get us out of the gate well ahead of expectations. I'd now like to turn the time over to Don for a discussion of the quarterly financial results starting on Slide 3.Read the rest of this transcript for free on seekingalpha.com