WESCO Int'l (NYSE: WCC) reported Q1 EPS of $0.76, $0.03 better than the analyst estimate of $0.73. Revenue for the quarter came in at $1.77 billion versus the consensus estimate of $1.76 billion.

Mr. John J. Engel, WESCO's Chairman, President and CEO, commented, "Our first quarter results were in line with our expectations and the outlook we provided in January. Our sales results reflect improving momentum in our business, driven by a return to growth in Industrial and in Canada. Operating margin was also in line with our expectations, as we continue to execute our cost management and supply chain initiatives in a still-challenging and demand-constrained pricing environment. Net income grew in the quarter, and we once again delivered strong free cash flow, enabling us to reduce our debt and further improve our financial leverage ratio. Based upon our first quarter results, we reaffirm our full-year expectations of sales in the range of flat to up 4%, EPS of $3.60 to $4.00 per diluted share, and free cash flow generation of at least 90% of net income."

• Net sales were $1.77 billion for the first quarter of 2017, compared to $1.78 billion for the first quarter of 2016, a decrease of 0.2%. Acquisitions and foreign exchange rates had positive impacts on net sales of 0.9% and 0.6%, respectively, resulting in a 1.7% decrease in organic sales.
• Cost of goods sold for both the first quarter of 2017 and 2016 was $1.42 billion. Gross profit was $350.0 million and $355.2 million for the first quarter of 2017 and 2016, respectively. As a percentage of net sales, gross profit was 19.7% and 20.0% for the first quarter of 2017 and 2016, respectively.
• Selling, general, and administrative (\"SG&A\") expenses were $266.9 million, or 15.1% of net sales for the first quarter of 2017, compared to $269.3 million, or 15.2% of net sales, for the first quarter of 2016.
• Operating profit was $67.1 million for the current quarter, compared to $69.5 million for the first quarter of 2016. Operating profit as a percentage of net sales was 3.8% for the first quarter of 2017, compared to 3.9% for the first quarter of 2016.
• Interest expense for the first quarter of 2017 was $16.7 million, compared to $18.8 million for the first quarter of 2016. Non-cash interest expense for the first quarter of 2017 and 2016, which includes amortization of debt discounts and deferred financing fees, and interest related to uncertain tax positions, was $1.1 million and $2.1 million, respectively.
• The effective tax rate for the current quarter was 25.0%, compared to 31.9% for the prior year first quarter. In the current quarter, the application of Accounting Standards Update No. 2016-09 resulted in a discrete benefit from the exercise of stock-based awards, which lowered the effective tax rate by 3.1 percentage points. In the first quarter of 2016, the settlement of an outstanding tax matter increased the effective tax rate by 3.4 percentage points.
• Net income attributable to WESCO International, Inc. was $37.7 million and $36.0 million for the first quarter of 2017 and 2016, respectively.
• Earnings per diluted share was $0.76 for the first quarter of 2017, based on 49.4 million diluted shares, compared to earnings per diluted share of $0.77 for the first quarter of 2016, based on 46.8 million diluted shares.
• Operating cash flow for the first quarter of 2017 was $47.6 million, compared to $78.6 million for the first quarter of 2016. Free cash flow for the first quarter of 2017 was $43.1 million, or 114% of net income, compared to $75.0 million, or 217% of net income for the first quarter of 2016.

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