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Before we turn our attention to the quarterly results, let's review our Safe Harbor statements which are slides 1 and 2 of the presentation materials. During the course of this presentation, we will be providing forward-looking information and referring to non-GAAP measures. Please read carefully the forward-looking statements section of our press release and Form 10-K in understanding of the risks and uncertainties associated with forward-looking information and the reconciliation of non-GAAP measures to GAAP. And now, I'll turn the call over to Martin Slark. Thank you.Martin P. Slark Thank you, Steve, and welcome to everybody to our Q2 release call. Let me ask you to turn to Page 3, and I'm going to start my section by giving you a quick summary of the quarter. Q2 for us, frankly, was a challenging quarter primarily from a revenue perspective. But I think if you look at our operating results, we believe that we executed very well in many areas, particularly with our gross margin, our SG&A cost control, and we had very strong cash flow. Looking back over the prior 6 months, and we're all brilliant with the benefit of hindsight, it's now clear that the pre-Christmas production ramp probably peaked in the month of September, and in fact, it was pretty obvious to us it happened around the middle of September and then we saw slowing bookings through October and then into November. Our customers, we believed, were trying to maximize the use of low-cost sea freight to improve margins and were not willing to risk of rebuilding inventory and were clearly ongoing uncertain economic times. This resulted in very strong revenues in the September quarter, but also weakened in December quarter. As part of the September guidance, we gave our best estimate of the potential impact of the floods in Thailand. The floods actually ended up lasting much longer than were planned or thought at the time and caused much more of a severe disruption to our customers supply chain than we initially expected. Our facility in Thailand was not damaged and has continued in full operation. However, customer shipments from both our facility in Thailand and our regional distribution center in Singapore were reduced. This event was very slow in developing, and we were still in the beginning of the event at the time of our release. At that time we estimated that the impact would be about $5 million per month and probably would last no longer than one month. For total impact to the quarter of $5 million. Now the quarter is over, we have calculated the impact to revenue to be approximately $15 million. We expect our cost facilities that was severely damage to come back online if they are not already online now progressively during the March quarter and therefore, we do not expect a significant impact to our revenue during this current quarter.
Dave Johnson, our CFO, will provide more color on our financial performance in a few minutes. However, we were pleased with our cost management during the quarter. Our gross margin was strong for this level of revenue. SG&A, despite our annual wage increases around the world, were reduced sequentially. Capital spending was at the low end of our projected range and cash flow was solid. We're working hard to control all aspects of the P&L that we can control, headcount, discretionary spending, et cetera, responding as quickly as possible to changing business conditions, but we are continuing to invest aggressively in R&D and in our new product pipeline.During the quarter, we closed a small acquisition, Temp-Flex Cable, which we believe will fit well into our high performance cable business, will bring us added exposure to medical as well as other cable-related markets. In addition to bolstering our exposure to these attractive markets, the additional wire and cable capabilities will help us take advantage of increasing opportunities for high-speed cable assemblies across many end market sectors. Read the rest of this transcript for free on seekingalpha.com