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So earlier today, we reported our financial results for the first quarter ended March 31, 2012. Net sales for the first quarter of 2012 totaled $382.1 million, which is a record high quarterly revenues total. First quarter sales increased 29.8% from 294.4 million that was in the first quarter of 2011, our first quarter 2012 net income totaled $6.2 million of $0.57 per diluted share compared to net income of $10.3 million or $0.94 per diluted share the last year’s first quarter.Capitalizing our first quarter highlights: number one, we achieved record quarterly sales; number two, our Chicago Tube and Iron acquisition is performing well; number three, we are ahead of our internal production and financial plans related to our temper mill facility investment in Gary, Indiana; and four, we completed a $50 million amendment to our existing credit agreement to increase our revolver size from $265 million to $315 million. Our first quarter results in record sales benefited from sequentially-improved flat roll performance from the fourth quarter of 2011 and from outstanding performance in the Pipe and Tube segments. Our Pipe and Tube business has been immediately accretive to our earnings since we acquired Chicago Tube and Iron on July 1, 2011. Our balance sheet remains strong and a large revolver culminates our larger working capital needs while lowering our borrowing rates. We also reported today that (inaudible) as Board of Directors approved the regulator – a regular quarterly cash dividend of $0.02 per share to be paid on June 15, 2012 to the shareholders on record on June 1, 2012. I’ll now turn the call over to Rick Marabito. Rick Marabito Thank you, Michael, and good morning, everyone. I’ll review some additional financial highlights from the first quarter. But first, I’d like to remind everyone that we acquired Chicago Tube and Iron on July 1, 2011. At such our first quarter of 2011 does not include (inaudible) and our visits results are now reported in two segments: so flat products segment and the tubular and pipe product segment. For more information, please refer to our segment information provided in the earnings release and in our Form 10-Q, MD&A, and footnotes.
Some other financial highlights. As a percentage of net sales, consolidated gross margin totaled 19.7% in the first quarter, up from 19.4% recorded in the fourth quarter, and down from the robust flat-rolled margins of 21.5% earned in the first quarter of 2011.Pipe and tube gross profit totaled 31.4% for the first quarter of 2012 as our pipe and tube products gross margins are higher than our traditional flat products margins. As a percentage of sales, first quarter 2012 operating expenses totaled 16.5% versus 18.2% in the fourth quarter and 15.7% in the first quarter of 2011. EBITDA, defined as our operating income before depreciation and amortization expense on the face of our income statement, totaled $17.3 million, up from $8.4 million earned in the fourth quarter and $20.8 million in the first quarter of 2011. Capital spending in the first three months of 2012 totaled $8 million that is similar in amount to what we spent in the first quarter of 2011. The majority of the spending related to the completion of our temper mill project in Gary, Indiana, equipping facilities in Mount Sterling, Kentucky, and Chambersburg, Pennsylvania, and installation of a new jumbo laser at CTI in Chicago. We expect our total capital spending in 2012 to be in the $30 million to $37 million range, depending on the timing and the choices we make on lease financing. Our effective income tax rate in the first quarter was 38.9% and we expect our full year 2012 income tax provision to remain in this range. Our flat-rolled inventory turnover rate for the first quarter was 4.1 times, slower than our historical turnover rate of 5 times. Read the rest of this transcript for free on seekingalpha.com