Global Industrial Company (NYSE:GIC) Q2 2022 Earnings Conference Call August 2, 2022 5:00 PM ET

Company Participants

Mike Smargiassi - The Plunkett Group

Barry Litwin - CEO

Tex Clark - SVP and CFO

Conference Call Participants

Anthony Lebiedzinski - Sidoti & Company

Ryan Merkel - William Blair

Operator

Good afternoon, ladies and gentlemen, and welcome to the Global Industrial's Second Quarter 2022 Earnings Call.

At this time, I would like to turn the conference over to Mike Smargiassi of the Plunkett Group. Please go ahead, sir.

Mike Smargiassi

Thank you, and welcome to the Global Industrial second quarter 2022 earnings call. Leading today's call will be Barry Litwin, Chief Executive Officer; and Tex Clark, Senior Vice President and Chief Financial Officer. Formal remarks will be followed by a question-and-answer session.

Today's discussion may include certain forward-looking statements. It should be understood that actual results could differ materially from those projected due to a number of factors, including those described under the forward-looking statements caption and under Risk Factors in the company's annual report on Form 10-K and quarterly reports on Form 10-Q. The press release is available on the company's website and has been filed with the SEC on a Form 8-K. This call is the property of Global Industrial Company.

I will now turn the call over to Barry Litwin.

Barry Litwin

Thanks, Mike. Good afternoon, everyone, and thank you for joining us.

Second quarter performance reflects the continued implementation of our ACE strategy and strong execution by the Global Industrial team. Revenue reached a quarterly record of over $318 million, growing nearly 17% with solid demand throughout the quarter. Gross margins remained healthy but pulled back from the record performance in the first quarter of this year, reflecting the impact of freight fuel surcharges, certain promotional activities on excess and seasonal stock as well the flow-through of some higher-cost inventory.

In terms of our bottom line performance, we delivered solid operating leverage and generated over $30 million in operating income, a 23% increase from the year ago quarter. And operating margin improved 50 basis points to 9.6% from Q2 of 2021.

Overall, we were very pleased with our second quarter performance as we made further progress on key digital, sales, marketing, customer and distribution initiatives. We believe these investments will strengthen our competitive position and help us drive growth and capture additional market share in the highly fragmented industrial distribution marketplace.