TRS-RenTelco, our electronics division, rental revenues for the quarter increased by $1.4 million, or 6%, to $23.4 million from a year ago. Divisional income from operations increased by 14%, or $0.9 million, to $7.4 million in 2012. In addition to higher rental revenues, our electronics business also benefited from lower depreciation and direct SG&A costs as a percentage of rental revenues from a year ago.

Modular division rental revenues for the quarter were relatively flat at $19.9 million from a year ago. Rental revenues grew by 15% year over year in our markets outside of California; however, they declined by 8% within the state. California continues to be plagued by fiscal and budgetary challenges. Year over year income from operations decreased 29% from a year ago to $4.0 million; however, modular rental operations gross profit declined only 5%. The higher percentage reduction in income from operations was due primarily to higher SG&A expenses associated with the continued expansion of our portable storage rental business and divisional employee costs, as well as lower gross profit on modular equipment sales. Modular utilization was down slightly to 66.5% compared to 66.8% a year ago.

Our portable storage and environmental test equipment businesses both continued to make good progress in their market penetration, booking levels, and rental revenue year over year growth during the quarter. We continue to work hard to grow both of these initiatives.

Company-wide SG&A expenses rose 15% to $21.4 million over the same quarter a year ago, and 2% from the fourth quarter of 2011. The year over year increase relates primarily to employee, IT software and hardware, and facilities infrastructure costs. We are very focused on managing our overhead costs tightly to ensure that we are meeting our annual SG&A expense to rental revenue target ratios, which are a component of senior management’s remuneration program.”

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