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Interline Brands Announces First Quarter 2011 Sales and Earnings Results

JACKSONVILLE, Fla., May 6, 2011 (GLOBE NEWSWIRE) -- Interline Brands, Inc. (NYSE:IBI) ("Interline" or the "Company"), a leading distributor and direct marketer of maintenance, repair and operations products ("MRO"), reported sales and earnings for the fiscal quarter ended April 1, 2011.
/ Source: GlobeNewswire

JACKSONVILLE, Fla., May 6, 2011 (GLOBE NEWSWIRE) -- Interline Brands, Inc. (NYSE:IBI) ("Interline" or the "Company"), a leading distributor and direct marketer of maintenance, repair and operations products ("MRO"), reported sales and earnings for the fiscal quarter ended April 1, 2011.

"Our first quarter results reflect broad-based improvement, and we are encouraged to report organic growth in all of our end-markets. As the market environment continues to improve, we are focused on the execution of key initiatives that will enable us to generate long-term shareholder value," commented Michael Grebe, Chairman and CEO.

First Quarter 2011 Performance

Sales for the quarter ended April 1, 2011 were $297.4 million, a 21.3% increase compared to sales of $245.2 million in the comparable 2010 period. Interline's facilities maintenance end-market, which comprised 75% of sales, increased 26.4% during the first quarter. The professional contractor end-market, which comprised 14% of sales, increased 9.1% for the quarter. The specialty distributor end-market, which comprised 11% of sales, increased 6.3% for the quarter. Not including the acquisitions of CleanSource and Northern Colorado Paper and taking into account an additional shipping day in the first quarter of 2011, average organic daily sales increased 4.3% for the quarter. 

"Overall trends remain positive in our end-markets, and we have witnessed a meaningful change in the confidence levels of our customers. We continue to leverage our recent acquisitions in the jan-san space to drive cross-selling opportunities and expand into underpenetrated geographies," said Mr. Grebe. 

Gross profit increased $15.8 million, or 16.6%, to $110.9 million for the first quarter of 2011, compared to $95.1 million for the first quarter of 2010.  As a percentage of net sales, gross profit decreased 150 basis points to 37.3% compared to 38.8% for the first quarter of 2010.

"The transformation of our distribution network is progressing on plan as we implement our larger regional replenishment centers," commented Kenneth D. Sweder, Interline's President and Chief Operating Officer. "With these centers, we have achieved some of the highest customer fill rates in our history as a company, and we expect to see continued improvements to our inventory management as the year progresses."

Selling, general and administrative ("SG&A") expenses for the first quarter of 2011 increased $10.9 million, or 14.1%, to $88.1 million from $77.2 million for the first quarter of 2010. As a percentage of net sales, SG&A expenses were 29.6% compared to 31.5% for the first quarter of 2010. 

First quarter 2011 operating income of $17.1 million, or 5.8% of sales, increased 29.9% compared to $13.2 million, or 5.4% of sales, in the first quarter of 2010.

Earnings per diluted share for the first quarter of 2011 were $0.20, an increase of 18% compared to earnings per diluted share of $0.17 for the first quarter of 2010. Earnings per diluted share for the first quarters of 2011 and 2010 include a $0.01 per diluted share charge associated with ongoing improvements to our distribution network. Earnings per diluted share for the first quarter of 2010 also included a $0.02 per diluted share charge associated with previously announced changes in the Company's executive management.

First quarter 2011 free cash flow was $8.1 million compared to $12.3 million in the first quarter of 2010. Cash flow from operating activities for the first quarter of 2011 was $13.5 million compared to $16.1 million for the first quarter of 2010.

Business Outlook

Mr. Grebe stated, "Looking ahead, we recognize that our end-markets are still in the early stage of a recovery. Though we have not yet hit our full stride, we are encouraged by the progress within our business to become more efficient as we grow. We remain confident in our direction and our ability to execute against our initiatives to strengthen Interline's position as a premier, broad-line MRO distributor." 

Conference Call

Interline will host a conference call on May 6, 2011 at 9:00 a.m. Eastern Standard Time. Interested parties may listen to the call toll free by dialing 1-800-427-0638 or 1-706-634-1170. A digital recording will be available for replay two hours after the completion of the conference call by calling 1-800-642-1687 or 1-706-645-9291 and referencing Conference I.D. Number 62624663. This recording will expire on May 20, 2011.

About Interline

Interline Brands, Inc. is a leading distributor and direct marketer with headquarters in Jacksonville, Florida. Interline provides maintenance, repair and operations products to a diversified customer base of facilities maintenance professionals, professional contractors, and specialty distributors primarily throughout North America, Central America and the Caribbean. For more information, visit the Company's website at http://www.interlinebrands.com.

Recent releases and other news, reports and information about the Company can be found on the "Investor Relations" page of the Company's website at http://ir.interlinebrands.com/.

Non-GAAP Financial Information

This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("US GAAP"). Interline's management uses non-US GAAP measures in its analysis of the Company's performance. Investors are encouraged to review the reconciliation of non-US GAAP financial measures to the comparable US GAAP results available in the accompanying tables.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

The statements contained in this release which are not historical facts are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in, or implied by, forward-looking statements. The Company has tried, whenever possible, to identify these forward-looking statements by using words such as "projects," "anticipates," "believes," "estimates," "expects," "plans," "intends," and similar expressions. Similarly, statements herein that describe the Company's business strategy, outlook, objectives, plans, intentions or goals are also forward-looking statements. The risks and uncertainties involving forward-looking statements include, for example, economic slowdowns, general market conditions, credit market contractions, consumer spending and debt levels, adverse changes in trends in the home improvement and remodeling and home building markets, the failure to realize expected benefits from acquisitions, material facilities systems disruptions and shutdowns, the failure to locate, acquire and integrate acquisition candidates, commodity price risk, foreign currency exchange risk, interest rate risk, the dependence on key employees and other risks described in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2010. These statements reflect the Company's current beliefs and are based upon information currently available to it. Be advised that developments subsequent to this release are likely to cause these statements to become outdated with the passage of time. The Company does not currently intend, however, to update the information provided today prior to its next earnings release.

CONTACT: Lev Cela PHONE: 904-421-1441