Hello, this is Laura Brown, Vice President of Investor Relations; and I'm here with Bill Chapman, Director of Investor Relations. Welcome to Grainger's quarterly audio webcast covering results for the second quarter ended June 30th 2008. This recording is intended to provide you with information on our recent performance. Please use this information in conjunction with the earnings release, and other financial information posted on our Investor Relations website. Before we begin, I'd like to remind you that certain statements and projections of future results made in the press release in this webcast constitute forward-looking information. These statements are based on current market conditions and competitive and regulatory expectations, and involve risks and uncertainty. Please see our Form 10-K for a discussion of factors that relate to forward-looking statements. Grainger posted record sales of $1.8 billion in the 2008 second quarter. Sales were up 10% versus last year's second quarter. Both quarters contain 64 selling days. Operating earnings increased 11% and net earnings increased 8%. Earnings per share grew by 18% to $1.43. It is important to note that these results include a special charge. During the quarter, the company recognized $0.05 per share in unallocated expenses for our legal reserve. This expense relates to allegations involving sourced items and the Trade Agreement Act compliance under the company's GSA contract. Excluding this charge, operating earnings were up 14%, net earnings were up12%, and earnings per share were up 22%. Operating margins increased about 10 basis points in the quarter to 10.5%, once again excluding the charge operating increased 40 basis points to 10.8%. This operating margin expansion was due to positive operating expense leverage and an 18 basis point improvement in gross profit margins. Again excluding the charge, operating expenses as a percent of sales decreased from 29.6% in the…

Thanks Laura. Let's move on to a brief review of our primary growth initiatives in the United States. During the quarter, market expansion and product line expansion once again delivered incremental sales growth and market share gains. As Laura noted, these two programs contributed about 6 percentage points of the 9% sales growth for the segment. Over the past five years, the market expansion program has improved our presence and penetration in the top 25 markets across the United States. During the quarter, we completed ten Branch projects. Five more are expected in the back half of the year, which will complete all six phases of market expansion. Despite the completion of the program this year, we expect market expansion to continue to deliver incremental sales and earnings through 2013. Let's now take a look at the product line expansion program. Part of the value we bring to customers is being a one stop shop for all the MRO items they need to repair and maintain their facilities. Since the program began in 2006, we have added more than 100,000 new products to the catalog. In addition, we have added another 35,000 products that are available to customers now and will be featured in our 2009 catalog in February. This program coupled with improved local availability resulting from market expansion has enabled Grainger to say yes, more often to our customers. As a result, we have deepened our relationship with customers and have captured market share. Given the success to date, we expect to continue to add new products and drive growth for several more years. Second quarter operating earnings for the company increased by 11% versus the 2007 second quarter. The improvement came from the Grainger branch-based segment in Acklands Grainger. This 11% increase for the company was the…

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THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.