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I'd like to begin with some opening commentary followed by Mr. Widman, who will provide with a detailed financial report and Mr. Riordan, who will discuss our operations by segment. Tom and Phil will take your questions along with me at the end of our comments. I'd like to encourage you to ask one question and only a follow-up. The presentation we will be referring to is accessible on the company's website. Let me begin by referring to the forward-looking statement on Page 2, which I encourage you to review and read.So beginning with Page 3 marked overview, I'd like to start. In general, we believe we are at an inflection point with the future where the future will continue to be better than the past. When examining our operating performance, we see this inflection change across many of our key performance indicators. As noted on Slide 3, our net sales have improved although moderately, and we do expect moderate growth in the second half of 2010. We expect this growth to accelerate next year. Backlog has grown with the exception of our Crane business where weakness persists, but the Port Equipment business is beginning to turn the corner. We see this in quotation activity as well as in orders we've been able to secure. Overall, for the company, our production schedules have continued to increase in most of our product categories, allowing us to better absorb our manufacturing costs and return to a more balanced, stable and productive level. Cost reductions continued in the company with some additional restructuring planned for both our Construction and Crane businesses. Net sales growth, new factory and other investments continue in the developing markets, which have been a source of meaningful growth for us this past year. So to turn to Page 4, summarizing our future outlook. We continue to expect our 2010 operating profit to be at break-even. This is excluding restructuring and unusual items. This represents substantial improvement compared to the prior year on modest net sales gains. The resulting per-share result, excluding restructuring and unusual items, is expected to be a $1 per share loss. As expected, we see signs of continuing improvement in three of our four segments with the slowdown in Cranes, as previously mentioned, and has will be noted throughout our commentary.
As we look to the future, we expect both market and organic growth through 2013. It's difficult to know the overall strength of this recovery, but we do believe it will be broadly based, led by developing markets, then North America and finally, Europe. From our product portfolio perspective, we believe our Materials Processing business has been and will be the first to improve followed by our Aerial Work Platform business and Construction product lines, with our Crane operations being the last to recover strongly. There are niche businesses within each one of these segments that may have slightly different characteristics, but these are the general trends we expect to see from these segments.As everyone knows, we have and will continue to have a negative arbitrage by carrying the amount of cash we have relative to the amount of debt. We continue to explore strategic usage of its capital, and precise outcomes are hard to predict at this moment in time. However, we remain confident that some combination of debt pay down and acquisitions will be achieved in the future periods. On a macro basis, we see our customers improving somewhat, although smaller customers and specialized customers remain financially stressed. The financial shouts that caused many of our end markets to decline as much as 80% are now behind us, and we see moderate growth from here. We are all a bit frustrated that the six year highway reauthorization bill in the United States has not happened, and it is unlikely to happen in the short term. But somehow, the industry is making do and we are keeping repaired our aging infrastructure with the hope of someday building a better future. Now I'd like to turn it over to Phil who will cover the quarter in detail and Tom remarks will follow. Phil?
Philip WidmanThanks, Ron, and good morning. The key figures table, Page 5, displays the quarterly year-over-year and sequential performance for the continuing operations of the company. Net sales increased 14% from the prior year quarter or 6% when excluding acquisitions. The translation impact to foreign currency exchange rate changes was minimal compared to the prior year. However, sequentially, negatively impacted net sales by $46 million. So on a sequential basis, second quarter net sales increased by 15%. However, excluding the translation effect of foreign currency, the changes is increased by 20%. Generally, the increases included all segments except the Crane segment, which continue to experience softening demand in certain product areas, mainly all-terrain cranes. We incurred a loss from operations in the second quarter of $10.4 million compared to $115.1 million in the prior year quarter. The impact of increased production levels, cost reductions and reduced restructuring activity favorably impacted the comparisons of the prior quarter as well as sequentially. Working capital of quarterly annualized sales was at 32% in the period, which is largely on track with our plans. Net debt increased to $447 million mainly due to the translation effect of our foreign denominated cash balances, we hold approximately EUR 700 million at this stage. Working capital and financing receivable build in the period and capital spending. Overall, liquidity of over $2 billion, with cash balances of $1.5 billion and availability under the revolving facility of $510 million, continues to provide significant flexibility to put cash to work to yield higher returns and accelerate growth as well as be opportunistic on acquisitions. Read the rest of this transcript for free on seekingalpha.com