Good morning, ladies and gentlemen, and welcome to the Beacon Roofing Supply Fiscal Year 2013 First Quarter Conference Call. My name is Anthony, and I will be your coordinator for today. [Operator Instructions] As a reminder, this conference is being recorded for replay purposes. This call will contain forward-looking statements that fall within the Safe Harbor provisions of the Safe Securities Litigation Reform Act of 1995 regarding the future events of the future financial performance of the company, including the company's financial outlook. Bear in mind that such statements are only predictions, and actual results may differ material -- materially as a result of risks and uncertainties that pertain to our business. These risks are highlighted in our quarterly and annual SEC filings. The forward-looking statements contained in this call are based on information as of today, February 8, 2013, and except as required by law, the company undertakes no obligation to update, revise any of these forward-looking statements. Finally, this call will contain references to the certain non-GAAP measures. The reconciliation of these non-GAAP measures is set forth in today's press release. On this call, Beacon Roofing Supply may make forward-looking statements, including statements about its plans and objectives and future economic performance. Forward-looking statements are subject to a number of risks and uncertainties. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including but not limited to, those set forth in the Risk Factors section of the company's latest Form 10-K. The company has posted a summary financial slide presentation on the Investors section of its website under Events & Presentations that will be referenced during the management's review of the financial results. On the call today for Beacon Roofing Supply will be Mr. Paul Isabella, President and CEO; and Mr. Rick Welker, Vice President and Acting Chief Financial Officer. I would now like to turn the call over to Mr. Paul Isabella, President and CEO. Mr. Isabella, you may proceed.

Thanks, Anthony. Good morning, and welcome to our 2013 first quarter earnings call. We started off the year by delivering $0.37 of reported EPS versus $0.41 in Q1 of last year on record first quarter sales of $514 million. We feel these are very solid results and a good start to our fiscal year. For reference, last year's first quarter was impacted by strong price increases in organic growth, further fueled by some very mild December weather and carryover storm volume from earlier in 2011. The $0.37 we delivered is close to our internal plan, which gives us confidence in our full year estimate. We certainly recognize that quarterly fluctuations in sales and EPS occur due to a number of factors such as demand in our markets and weather variations. This is why we continue to focus on full year guidance. Sales in total were up about 5%, while existing market sales were down about the same. While we aren't pleased with existing sales being at this level, it was not a surprise based on the tough comps -- sales comps from last year. As a quick reminder, last year in Q1, we had total sales growth of 21% and organic growth of 17%, of which an estimated 8% is related to price increases. As I'll speak to shortly, the largest percent sales decline occurred in the month of December for our Q1 2013. In the quarter, overall selling prices were flat to last year and we're able to deliver higher gross margins. We believe pricing in the quarter was impacted by lower demand for both residential and commercial products. Gross margins will continue to be influenced by a number of factors such as mix, market demand, and of course, product cost. We're very pleased with the Q1 gross margin…

Thanks, Paul. Good morning. I will highlight some of the key financial results and metrics contained in our earnings press release, Form 10-Q and the first quarter slides posted to our website this morning. Regarding sales, total sales for the quarter, aided by our acquisitions, increased 4.9% to a record $514 million. Our first -- our fiscal 2013 first quarter organic sales, which reflect our existing markets by excluding sales at branches acquired since the beginning of last year's first quarter, decreased 4.6%. We had 62 selling days sales in this quarter compared to 60 last year, as Paul said. Therefore, organic sales decreased 7.7% on an average sales per day basis. Our sales by product group in existing markets were as follows: Residential Roofing sales decreased 5.4%; Non-residential Roofing decreased 6.1%; and Complementary Products were up 2.9%. This was the second quarter in a row that we saw an increase in our Complementary Product sales, which is a more discretionary consumer category and perhaps a positive indicator for the economy in general. We had more storm business in last year's first quarter, which is impacting the roofing sales comparisons, along with slightly lower average residential prices down about 3%. Commercial business has been softer over the last few quarters after our previous 8 consecutive quarterly gains. Overall, average selling prices in comparison to Q4 were relatively unchanged. In our geographic regions, our Southwest and Canada regions showed double digit existing market sales growth for the quarter. Our Southeast region had an increase of 5%, while our Other regions were down due mostly to -- due to prior storm activity, the Commercial Roofing slowdown and some tough comparisons to a mild December 2011. Regarding gross margin, gross margin increased to 24.7% from 24% last year. Our acquired companies have a…

[Operator Instructions] We'll take our first question from Keith Hughes with SunTrust.

Yes. A question on the Commercial business, can you give us any kind of feel on trends you're seeing there? There's some of the macro stuff on Commercial continues to bounce around flat, you're down and then there's a tough comp. Just what is your feeling on that market in the next 3 to 6 months?

Yes, Keith, it's interesting, there's no doubt. I'll go back a little bit into October. There is almost immediate softening in October commercially across most of our markets. A lot of it we viewed as being very weak public work that wasn't lent, that was deferred. And that didn't obviously help us in the quarter. Of late, just in this last month or so, you heard a little bit of the January numbers, there's been, at least from a sentiment standpoint from our guys, from our customer base, backlog seems to be growing and contractors are more optimistic. So that being, obviously, kind of a little bit impacted by the fact that Boston, for instance, is probably going to have 2 feet of snow in the next 20 hours. That might impact the next week in terms of that volume. But in general, I think over the next 3 months, 6 months, the view is positive. And we still believe, and I don't have any indications not to, that we will see this 5% growth, even with the huge growth we have seen over the 8 quarters prior to these last 3. So some of it we're going to -- we'll bump up a bit against the comps that were negative last year in the third and fourth quarter as we hit the second half. And we still have the heavy comp for Q2, no doubt from last year, where we saw something like over 15% organic growth. But so, so like, we're more positive than we've been through the first quarter.

This is Rick. In my discussions with the regional vice presidents, there's no indication that there's a long-term trend of a Commercial slowdown. I think they -- most of them view that as temporary, and being up against unusual bump in the first quarter and first 2 quarters of last year. So again, it gets back to the economy mostly, but there's no long-term concern about Commercial downward trends that we're hearing.

Yes, and as we've always said, Keith, that the -- they can -- folks can defer, but they're going to have to end up repairing the roof at some point. So if there were, as we believe, deferrals in Q1, they're going to come due in either Q2 depending on weather and the geographic region they're in or Q -- beginning in Q3.

Okay. A final question, can you give us an update on the CFO search?

Yes, it's going quite well. Rick is doing an outstanding job since the beginning of January and prior. We're very close. We feel very confident that we're going to be naming someone within the next 30 days.

Our next question comes from Michael Rehaut with JPMorgan. Michael Jason Rehaut - JP Morgan Chase & Co, Research Division: I had a question on the gross margins. Certainly it's been a nice success for you guys in the last year or 2. And resi has the higher mix or benefit -- benefits gross margins from their higher levels. How are you thinking about that in 2013 and '14, if residential should continue to do well and commercial is, as I think most people feel, a more of a challenged outlook at least for 2013?

Yes, I think naturally, and you see it in our -- in the Q, in our results for our total gross margin and for existing gross margin. I mean you can see the breakout of the acquired markets, right, where they're higher by 4 points or so. They influence the total rate by about 1/2 point. In the absence of any other mix change, as we do more residential volume, our gross margins should trend up. So again, for the quarter based on 500-plus million of sales and $53 million of that being acquired markets, that little bit of volume at 4 points higher pulled up our gross margin by 1/2 point. So from a gross margin standpoint, it's very favorable as we continue to do more resi work. We certainly love commercial work and want that to continue to grow also. Michael Jason Rehaut - JP Morgan Chase & Co, Research Division: And I just want to make sure I understood correctly before when you talked about your comfort with the street at $1.81 EPS. That's inclusive of your expectation for 3% to 4%. I guess, is it just EPS accretion off of 2012 from your acquisitions?

Yes, there's -- if you look at our -- the incremental sales impact from acquisitions for '13, as I said, the plan is around $230 million or so. So there -- and there is purchase accounting, obviously, in that number. But the...

Not sales, though.

Yes, not in sales, but in the net income number, of course. So the impact actually in '13, it will be greater than $0.03, $0.04. It's probably going to be upward in the neighborhood of $0.10 to $0.12 of EPS for those incremental acquisitions. And that takes following path out of the acquired and puts it back in existing in terms of that number. Michael Jason Rehaut - JP Morgan Chase & Co, Research Division: But that's all, again, reflected in your -- or inclusive in your comfort with the $1.81?

Yes, it is. The rest of it would be the 5% organic growth on the $2 billion and change that we did in 2012. The upside to that is, of course, if we grow more organically with, let's say, improved economics, just greater demand, whether it's storm-induced or weather-induced or not. And if pricing sticks, if the residential pricing sticks, let's say, because there's more optimism on Residential pricing sticking than Commercial, we can do the math on for every point of resi -- for the whole resi line of business that is impacted for a number of months, we can calculate the EPS impact. So for sure, if we see favorability in above-normal storm volume, let's say, better economics and price holding, because we don't have any price in our model, that would mean something above the $1.81, yes. Michael Jason Rehaut - JP Morgan Chase & Co, Research Division: Appreciate it. One last one, if I could, as you're looking at the M&A pipeline right now, and certainly, I think in the last year or 2, you've accelerated off of the kind of the downturn or trough element, trough parts of the cycle, is the current pipeline and your current appetite stronger than it was 6 or 12 months ago or the same?

Well, I -- to typify our appetite, it's always been strong for the right reasons. We're not going to buy bad companies and overpay for them. We've been very fortunate in the last 24 months, if you go all the way back to Enercon in April of '11, through buying very quality companies, high residential mix, higher gross margins and they're all performing, quite frankly. So our appetite is still high. We believe we have an outstanding operating team. We've expanded the corporate team to assist with the integration process, the systems integration. So our appetite is high, the pipeline is strong but again there's no guarantee of when any of these would come to fruition, but we continue to work that very hard, maintaining our relationships with these key distributors.

Our next question comes from Ryan Merkel with William Blair. Ryan Merkel - William Blair & Company L.L.C., Research Division: So my first question is on the prebuy. Maybe, Paul, could you just give us a sense of how big the prebuy was this year in comparison to last year? And then second part to that question, if the pricing were to hold, does that push your gross margins from kind of a 24%, which I think is implied in your guide, maybe closer to 24.5%, is that kind of the magnitude?

Yes, the -- I can't give you the exact numbers on the prebuy just because we don't typically disclose that. But if you look at our change in inventory, where it's in this $70 million, $80 million range total change year-over-year, we said $30 million of that was for acquired markets. So roughly $50 million was for prebuy, which we normally would not do in December. This would have occurred in January or February. But given that [indiscernible] all the majors on the resi side announced January 4th or 5th or so, we took the opportunity to do the buy. I would have to say it's somewhat smaller than last year, but it still positions us very well because it still gives us the opportunity potentially do some things in January also, given our cash debt position. On the gross margin side, yes, if pricing holds, and again, we can do the math on whether it holds at 15% for resi, 10% for resi, 7% or 5%, we can calculate it down to an EPS level. Typically, we would see during the selloff period of the inventory, a gain in gross margin rate and then a gain, of course, in gross margin dollars. And then usually what happens is that gross margin rate will drop back a bit. I don't know if 24.5% is accurate enough, but we would see some type of a gain on gross margin if pricing sticks, if. Ryan Merkel - William Blair & Company L.L.C., Research Division: Okay. And then, second question is on SG&A as a percent of sales. It was a little higher than I was thinking and I think, a little bit higher than I think you've guided last quarter because I think we were looking for something in the 17% to 17.5% for the year. Now I know the first quarter should be a little higher, just given the sales trajectory. But 2-part question, so was there anything in the quarter that made the SG&A as a percent of sales a little higher than you were maybe originally thinking? You mentioned higher amortization, maybe something in the base business. And then, am I thinking about it right that as the year goes on, that rate should come down, particularly if sales get better in the second half?

Yes, absolutely. I think you kind of hit all the points. There wasn't anything unusual in the base business. The drop-off in December, that $15 million or so sales drop-off that we didn't expect would drop off quite so quick just because of soft market, weather, holiday, whatever you want to call it, for sure impacted cost as we -- we're not going to adjust that fast and do silly things. But if you look at where we were last year, with the existing market now because we'll pullout the 20-plus percent cost on the acquired side. But if you look at where we were last year at 16% -- 16.6%, 16.7% versus the 17.3% this year, I mean, it's not anywhere out of the realm of what we thought, maybe slightly higher. There was some higher early impact storm volume down in Texas that did impact cost, and we've lined it out in the Q. It was a little unusual, given that the sales weren't that much higher. But if you -- our trending is going to be, for the year, in that 17% range in total for existing, maybe slightly under. That's what we're looking at internally. Acquired markets will be about 19%. So we feel pretty good about, one, our ability to control costs. If, let's just say, volume decided to, because of real soft demand, which we don't believe is going to have, dropped off, we control costs very well. And we think the level that we're at in Q1 fits our -- for sure, fits our internal plan for the full year, which is slightly below 17%.

Yes, this is Rick. I'll just add on the expenses. We did have $1 million hit this -- and comparatively year-over-year for the Enercon purchase adjustment. But the other thing that, certainly, I've heard from the field is that the greater-than-expected mix towards complementary does have an impact because it's more high -- more labor-intensive, smaller deliveries on average, more frequent deliveries. So that's the fact that commercial and residential had kind of a down first quarter, while complementary was stronger and pricing was stronger on that end, that did have some impact spread among pretty much all the regions. Ryan Merkel - William Blair & Company L.L.C., Research Division: Okay, that's very helpful. And just quickly, last thing, the January trends I view those as very, very positive, much better than I was thinking. I think you said maybe flat on an organic basis, given that tough comp. I'm just wondering does this kind of speak to just the general improvement in reroofing, new construction or just organic growth initiatives working?

I think it's all of those, and I think there's a little bit of what fell out from December, too. There were -- we got hit fairly hard in the last part of December, where sales really dropped for a number of reasons, and I think some of that came out. But we -- when you frame it in terms of a 46%, 47% organic growth last quarter, now that was highly unusual, right? Because the year before, in Q1 in '11, the weather was horrific. So we naturally -- and then, we had no -- like 0 weather January last year, so we were going to have a high B. But even -- and this January wasn't pristine across all of our markets. There were some heavy rain. There was snow. There were things that affected us, but we're very encouraged. So I think it's a -- I think there's -- as I said earlier, the key, so I think there's just more optimism and actually, more volume coming out, which makes us feel good. And if you look at a little bit of February, we don't have much, just we're in the few days in February. We're very close to our internal plan, which would put us again at flat, so we're pretty optimistic. Now obviously, the storm, for instance, up here in the Northeast will have an impact, but that is what it is. We can't control that, 2 feet or 3 feet of snow and a blizzard...

And we'll be better in the long run.

Yes. And as we say, I mean, that's part of the cycle of roofing, right, which we haven't had for the last year, so we're really pleased with January.

Our next question comes from Trey Grooms with Stevens.

On M&A, I mean, you said, Paul, that, of course, your appetite is still high, pipeline is still strong. When you kind of look at the type of acquisitions, do you think that you guys will continue to focus more on the players with the higher-res exposure like you did in 2012, as you kind of look at the pipeline today?

No, I think -- I know we look at all good acquisitions, and they could be heavier with commercial than residential, or they could be all residential or theoretically, they could be all commercial. So we're not targeting higher-res companies. We have built relationships with a number of them. That [indiscernible].

Okay, that makes sense. On commercial, again, following up from an earlier question, are you guys -- you said you're -- it's looking like it's a little better maybe for the outlook. You're not seeing any slowdown or anticipating anything there. Can you talk specifically to what you're seeing, what the guys in the field are seeing as far as new non-res and their -- kind of what they're hearing in expectations there for -- as they kind of look out this year?

Yes. I mean the view that we -- and you can go to whatever index you want to go to, there's still not any great view that there's going to be tremendous growth on the new construction side, so we're not pitting our hopes for the organic growth on that. We continue to work with all contractor base that serves both reroof and new construction. So I think it's going to be a while. But one, I don't -- many folks don't have the great ability to forecast when that's going to come back. As new resi construction continues to improve as it has, typically commercial follows. So whether that's mid this year, later this year, next year, at some point, it will have to.

We'll take our next question from Sam Darkatsh with Raymond James. Sam Darkatsh - Raymond James & Associates, Inc., Research Division: A couple of questions, 1 or 2 of them are housekeeping. First off, Rick what was the approximate gross margin spread between resi and non-resi in the quarter?

We don't usually get -- talk about the difference between the product group gross margins.

We've said historically that's it -- as we said on our Q4 call, say, 1,100 to 1,200 basis points between res... Sam Darkatsh - Raymond James & Associates, Inc., Research Division: And that's what you found in the quarter was 1,100, 1,200, the spread hasn't changed?

Yes, there wasn't any great shift or change.

I mean, it was better improvement in the resi gross margins. Sam Darkatsh - Raymond James & Associates, Inc., Research Division: Okay. And then, let me make sure I understand. Your guidance of 5% organic growth for the company, is that both -- 5% hold true both resi and non-resi also? Because you have different comparers obviously. Just trying to get a sense of how you're looking at the 2 segments compared to each other.

Yes, we have said, even with the deltas in these per quarter comps, that we've said both 5% on resi -- really all 3, though there could be some variation, resi, commercial and complementary. Sam Darkatsh - Raymond James & Associates, Inc., Research Division: Okay. And then, last question, I'm trying to understand the pricing that you're assuming in your model. You mentioned that no price is assumed, but if price is down in the first half, I guess, that does implicitly mean that you're assuming that price -- that some price does stick in the second half. First off, am I accurate in saying that? And then, if I am, if price doesn't stick then in the back half, wouldn't your gross margins then be under some risk potentially versus the 24%?

No. Because -- well, let's face it. Gross margins are always at risk, right, if we don't execute properly, if the market shifts. But if you look at our total price for the quarter, it's basically flat. The downside was some resi. I think that's more timing than just the fact that the quarter were softer. So if you -- and I won't get into the quarters, but if you assume flat, which I think is going to happen in the first half, then to get the back half when any potential increases, whether it's commercial or resi, you're going to take whole. So I'm not going to... Sam Darkatsh - Raymond James & Associates, Inc., Research Division: So by definition then, you're not assuming incremental price then in the second half within your guidance? Is that -- that's how I understand it.

That is correct, that is correct. So you could do the math on our 40% residential volume and the sales and then the -- any break point of price increase you want to based on, let's say, they hit in April, which could or couldn't happen. It just depends on when inventory is going to get bled off to get an impact on gross margin, which typically is 70% of the gross margin falls through.

Our next question comes from Dave Manthey with Robert W. Baird. David J. Manthey - Robert W. Baird & Co. Incorporated, Research Division: The -- a couple of things here. First off, on the inventory and how that process is being managed by the manufacturers this year. Is it true that the shingle manufacturers sort of put in a hard stop at year-end, and so potentially the increase you saw here this quarter -- in prior quarters would have been spread over a couple of quarters in the off-season and it's just sort of concentrated this year? Is that a true statement?

Yes. For sure, they announced early, and they've been fairly firm on extending -- not extending price if orders aren't placed, et cetera. So it's a little different behavior. And it could have -- Dave, in the past, last year, it was put out over more time. The residential folks announced the second -- also announced the second price increase in -- for April. And so if there's a belief that this first one for Feb, really now, and mid-Feb, March holds, there could be another round of distribution, believing they have to buy at the new price before the second price goes into effect. But this is, yes, a little different, a little tighter than previous years. David J. Manthey - Robert W. Baird & Co. Incorporated, Research Division: Okay. But safe to say, if you went -- anything's possible, I guess. But if you went back to them, the assumption is that you'd be paying the 10% to 14% higher today versus what you would have prior to year-end?

Yes, if we were purchasing now, yes. David J. Manthey - Robert W. Baird & Co. Incorporated, Research Division: Okay. All right. And then, when you talk about pricing... [Technical Difficulty]

We'll take our next question from Jim Barrett with CL King & Associates. James Barrett - CL King & Associates, Inc., Research Division: Paul, could you talk about Ford Wholesale and Construction Materials Supply? Can you tell me how those purchases came about? Was it an auction process or a longstanding relationship?

Yes. I think both were -- we typically don't divulge too much information about the workings of these acquisitions and how we ended up acquiring them. For a majority of the acquisitions were involved in, it's relationship-based and it's trust-based. Now whether or not the Ford or CMS were talking to other folks, that's not something I'm going to divulge. But it wasn't a straight auction. It's based on excellent relationships we have with the owners and their belief that Beacon is the best choice in terms of who they want to grow with and who their folks -- they want their folks to work for over the next couple of decades plus. James Barrett - CL King & Associates, Inc., Research Division: Okay, understood. As for new homebuilding, realized it's off a very small base. But are you starting to see any pickup from the new homebuilders in your specific regions?

Yes. We see them in the East Coast, whether it's Maryland, northern Virginia, Carolinas and of course, in Texas, even some up in eastern Pennsylvania. The activity has increased, and that is very encouraging for us. It's very competitive. It's a very competitive part of our line of business. But we play fairly effective in it. And given that, historically, it's 20% of our total sales, of late it's been more like 10% to 15% and in some areas even lower. It'll help our sales as housing continues to come back and especially as the spring hits. And in the northern markets, there's more construction.

We'll take our next question from Jack Kasprzak with BB&T. John F. Kasprzak - BB&T Capital Markets, Research Division: The decline in residential prices in the quarter of 3%, I was hoping you could talk a little bit more about that. Was it expected? Were you surprised at all? What were the factors around that, mix, region?

Yes, I think it impacted most of the regions. And I think some of it, Jack, was due to -- we've had a lot of backside -- we're in a lot of the backside of storm activity in a number of our markets, whether it's in the Midwest or in the Carolinas. And for sure, as a result of that natural pull-forward that occurs when there's weather events, there's competitive pressure because there's just less work that occurs. So for sure, we saw some pressure there on market pricing. And in general, I think that the main causation across all of our markets was that there was just less work in general. And that softening causes -- as we've said in the past, it causes more competitive activity in all the areas. And we certainly aren't going to lose share to any great extent at all, unless it really compromises our margins, so we sometimes follow that debt. But I don't -- that number, I wouldn't say it's noise, but it has fluctuated. If you look at our history of some of the price ups and downs, whether it's resi or complementary, it could be up 1 point or 2, down 1 point or 2. I'm not -- given this time of the year, given the softness in Q1, I'm not concerned at all about it because, at the same time, commercial was flat and complementary was soft.

And this is Rick. Fortunately, our product cost in resi went down a little bit more, so we had favorable gross margin impact. One other thing I'll add is that sequentially from Q4, it was up -- pricing in resi was up slightly, so not unexpected to have the year-over-year decrease.

Yes. And that's actually a very good point there Rick makes because if you look at all 3 of our major lines of businesses, sequentially, there hasn't been much movement, which is encouraging, considering the fact that our Q4 was fairly robust. We were just bumping up against some pretty heavy comps last year in terms of price increases we saw in the marketplace. John F. Kasprzak - BB&T Capital Markets, Research Division: That's fair, great color. Second question, just on Hurricane Sandy. I know you don't have many branches in the direct -- in the area that was directly affected, but did you see any impact there in terms of rebuilds soaking up demand? How would you -- how do you view that from where you guys sit?

Yes. We're seeing a couple of impact items. One was the first impact, which you have to -- I guess, you have to think about how much of a lasting impact it had in Q1, but when that event occurred through the week, that really shut down an awful lot of work that we were doing. And given that market was a tad softer in Q1, I don't know how much of that we really gained back. So that was an impact that wasn't positive. It's hard to quantify that. Second, we are seeing some volume from Sandy, not an awful lot. And again, it's been somewhat hard to figure out. I think we'll probably see $5 million to $10 million over the course of this year happening in eastern Pennsylvania, our southern Jersey branches and then on the south shore Connecticut. I also think it's going to play out longer term just because of the number of structures that were totally destroyed and have to be rebuilt. So we're probably talking more than 1 year-plus to see some of this trickle volume for us. Now, if we had a huge amount of branches in northern Jersey and Long Island, it might be a different story, but we don't.

Yes. The more important impact might be what does it do for the shingle market in total. John F. Kasprzak - BB&T Capital Markets, Research Division: Right, right. Soaking up some demand, absolutely.

Yes. Exactly. Firming up -- maybe firming up pricing demand, et cetera.

We will take our last question from Brent Rakers with Wunderlich.

I was hoping first, maybe Rick, since there are a lot of questions on pricing, if you could maybe reminds us exactly how you're calculating that price increase or price decrease number here.

Sure. It's just an estimate, but we basically look at taking the gross margin on the incremental price increase effect, but then also taking about 30% of the gross -- incremental gross margin for other expenses, commissions, credit card fees, additional bad debt, bonuses, things like that. But overall, about 70% of the gross margin dollars would fall to operating income, and then you take the tax effect so -- I mean, it's just an estimate that we say roughly $0.02 maybe per share can come from every percentage increase in pricing.

Okay. Rick, I'm sorry but I must have -- maybe didn't ask it as directly as I should. But I am actually referring to the 3% disclosed or estimated price decline in residential in the quarter. How exactly is that number calculated?

Oh, okay. Taking same items that are on hand year-over-year and looking at how they sell through for the period versus last year.

Okay, so it's a reflection of the price of the...

[Indiscernible] purchase cost.

Okay. Great, okay. And then, maybe a question -- I think it's been asked a couple of different ways, but there obviously are price increases in the channel. Do you have a sense of when the distribution, as an industry as a whole, would actually have to go meaningfully back into the market, given the prebuying demand and all that and actually have to start purchasing at those higher price levels? Are we talking March -- as early as March? Or are we talking more April and May?

Yes. I -- my view based on the intelligence reconnaissance I've done, intelligence gathered is that it'd be more in the April -- late April time frame, believe even early May. There has been some indications that some distributors have already committed to purchases at the new pricing, but I can't quantify that, which is something new. We typically don't hear that. So the hope is that as they burn through, given if weather continues to be relatively mild, worse than last year second quarter for us, but relatively mild but burn through that shingle inventory and then -- yes, in this April, May time frame, they'll actually have to purchase, so possibly even closer.

Okay. And then just one final question. And again, it's been a question asked, but I wanted to maybe readdress it. On the gross margins side, you talked about the impact going forward of some of the acquired operations carrying higher gross margins, I guess, predominantly because of mix. Could you maybe address -- though there's still some lingering benefit, I believe, in this December quarter from some of the previous prebuys and discounts you've been able to get on purchases. Could you maybe normalize that effect for us and how much more gross margin basis points, if you will, need to come off before -- kind of as you reach normalization on that front?

No, I don't think, to any great degree, that it's going to impact it. We tend to buy very consistently, and I think very effectively. We partner very well with the manufacturers. So I just don't think there's any normalization that's going to occur as a result of prebuys, post-buys, midyear buys.

That concludes the questions. Now I'd like to turn the call back over to Mr. Isabella for any closing remarks.

Great, thank you. Let me just go over a couple of highlights, repeats, but worth going over. For the quarter we ended up at $0.37 versus an adjusted $0.39 in first quarter of 2012. And as I said, for the full year, we still feel comfortable with $1.81. There's no price built into that, and there's no above-normal sales volume -- above-normal storm activity sales volume built into that, so we view that there's upside as those things occur. Overall, gross margins ended very strong at 24.7%, as we talked through that. Some of the impact, of course, is the acquisitions, but some of it is just disciplined pricing in our marketplace and also continued effective buying by our purchasing group. We talked about residential and commercial sales being down for the quarter. Again, not entirely surprising, given the strong comparisons that we were up against from last year and as I said, a number of times, the overall softer market we viewed Q1 as. We believe organic sales growth will be in the 5% range, as I said, for the full year, and we're real happy about the January sales results year-over-year and also the beginning of February. I talked about our incremental sales from acquisitions being around $230 million for 2013 and the fact that our pipeline is still very active, and we're confident we're going to make additional investments this year. Our corporate strategy is going to continue to focus on growth through acquisitions, new branch openings and same-branch sales increases. We continue to work on all 3 of these. And as always, as I do every quarter, I'd like to thank the employees of Beacon and the support of our investor and customer base. We're working very hard to execute our business plan every day. Thank you for your interest in our company. Rick and I are available for any other questions you might have, although access might be difficult given the pending storm up here in Boston and the fact that we have some travel requirements that have to occur. Thank you, and this concludes the call.