Nineteen ninety-eight was the most challenging year we have faced at Corporate Express. During this period, we shifted our focus away from acquisitions and intensified our efforts to improve operations and drive internal growth. We initiated a program to reduce costs, and we made difficult decisions regarding employees, facilities and business units. We launched an in-depth business review to evaluate our strategic options and to identify those areas of our business that offer the greatest return-on-invested capital opportunities. We began the process that led to the expansion of our Board of Directors and hired several senior executives with broad corporate experience to provide the leadership necessary to direct our future growth. At the same time, we continued to deliver the advanced technologies, solid execution and superb customer service for which Corporate Express is recognized around the globe. In doing so, we won thousands of new accounts and further expanded our relationships with existing customers.

I am proud of our senior management team, who did an excellent job of handling a number of moving parts in 1998. However, our financial results for the year were not nearly as robust as we would have liked. Our core businesses, including domestic distribution of office products and software, turned in respectable performances. Many of our international locations also posted strong results, including operating profit gains in Australia/New Zealand, Canada, Ireland, Italy and Switzerland, and solid growth in our European software distribution business. But several business units did not meet our expectations. These include our operations in the United Kingdom, although we are enthusiastic about our new senior management there. They also include our same-day scheduled and on-demand courier delivery service, Corporate Express Delivery Systems, which we have decided to sell. Our financial results for the year were also impacted by revenue softness in certain financial services and energy-related sectors and currency pressures in a few international markets.