WESCO International, Inc. (NYSE:WCC) Q2 2024 Earnings Conference Call August 1, 2024 10:00 AM ET

Company Participants

Scott Gaffner - Senior Vice President of Investor Relations
John Engel - Chairman, President, and CEO
Dave Schulz - EVP and CFO

Conference Call Participants

Deane Dray - RBC Capital Markets
Sam Darkatsh - Raymond James
Tommy Moll - Stephens, Inc.
David Manthey - Baird
Ken Newman - KeyBanc Capital Markets
Patrick Baumann - JPMorgan
Nigel Coe - Wolfe Research

Operator

Hello, and welcome to WESCO's 2024 Second Quarter Earnings Call. I would like to remind you that all lines are in listen-only mode throughout the presentation. [Operator Instructions]. Please note that this event is being recorded. I will now hand the call over to Scott Gaffner, Senior Vice President, Investor Relations to begin.

Scott Gaffner

Thank you, and good morning, everyone. Before we get started, I want to remind you that certain statements made on this call contain forward-looking information. Forward-looking statements are not guarantees of performance, and by their nature, are subject to uncertainties. Actual results may differ materially. Please see our webcast slides and the company's SEC filings for additional risk factors and disclosures. Any forward-looking information speaks only as of this date, and the company undertakes no obligation to update the information to reflect changed circumstances.

Additionally, today, we will use certain non-GAAP financial measures. Required information about these measures is available on our webcast slides and in our press release, both of which are posted on our website, wesco.com. On the call this morning, we have John Engel, WESCO's Chairman, President and Chief Executive Officer; and Dave Schulz, Executive Vice President and Chief Financial Officer. And with that, I'll turn the call over to John.

John Engel

Thank you, Scott. Good morning, everyone. Thank you for joining our call today. Our second quarter results were somewhat below our expectations for a low single-digit decline in reported sales, and this is against a continued mixed and multi-speed economic environment. Results improved, however, as we moved through the quarter with a return of organic sales growth in June. And that was accompanied by improvement in gross and operating margins on a sequential basis.

With our record $500 million of free cash flow generation in the first half, we're on track to deliver our full year free cash flow outlook of $800 million to $1 billion. As planned, we executed our capital allocation strategies and repurchased $300 million of our WESCO stock in the second quarter. We also closed on 2 small, but important software-based acquisitions: entroCIM being the first one, a data center and building intelligence software company; and Storeroom Logix, the second acquisition, an asset and inventory management software company. I think it's important to note that M&A remains a critical component of our enterprise growth strategy as we continue to benefit from our global capabilities, our leading scale, and our expanded portfolio and continue our move towards our long-term EBITDA margin expansion goal.