Now I will turn the call over to Pete for his opening comments.Merrill A. Miller Thanks, Loren, and good morning, everyone. Earlier today, National Oilwell Varco announced first quarter 2012 earnings of $606 million or $1.42 per fully diluted share on revenue of $4.3 billion. Excluding transaction cost, earnings were $1.44 per fully diluted share. This compares to year-earlier results of $0.96 per share on revenues of $3.15 billion. We are extremely pleased with these earnings and feel they are indicative of the great product offerings National Oilwell Varco offers to the industry, and the excellent execution of our outstanding employees. Thank you, all for your wonderful efforts. Additionally, we announced new capital orders of $1.91 billion for the quarter, a 15% increase from last quarter. Definitive proof of the demand for our market-leading highly technical equipment. Earlier backlog or ending backlog for the quarter was $10.4 billion. The first quarter is a nice start to 2012 and exemplifies the full cycle product offerings of NOV. At this time, I will ask Clay to provide color on these results and I'll return a little later to add a few operational comments. Clay? Clay C. Williams Thanks, Pete. National Oilwell Varco posted strong earnings for its first quarter of 2012, generating earnings for $1.44 per fully diluted share, up 44% from a year ago and a 5% from last year including transaction and devaluation charges from all periods. Revenues were a record $4.3 billion, up 37% from the year-earlier quarter and up slightly from the fourth quarter of 2011. Operating profit x transaction charges was $881 million and consolidating operating margins were 20.5%, both up sequentially and year-over-year. Operating leverage or flow-through was 48% on a small sequential revenue gain and 22% on the 37% year-over-year revenue gain. Our consolidated results show a shift in margins between 2 segments. Solid sequential margins gains within Petroleum Services & Supplies offset sequential declines in Rig Technology. Distribution & Transmission margins were down just slightly from a very strong level in Q4. Our businesses performed well in the first quarter, benefiting from high levels of activity in North America and abroad, as well as a great starting backlog of orders. Like others, we are watching closely the impact of low North American gas prices on activity, and we are shifting our operations from gassy basins to liquids-rich plays but we remain cautiously optimistic that rising oil rig activity will continue to offset falling demand for gas rigs across North America. Elsewhere around the globe, we foresee continued interest in Shale Gas Technologies onshore, and blossoming deepwater activity offshore.
We have made good progress in deploying capital to better position National Oilwell Varco to better serve our customers through investments in new plants in spare parts and repair inventory to support our installed base and in acquisitions. And this quarter's results reflect contributions from all 3. New facilities for downhole tools, drill pipe, Fiberglass Pipe, coil tubing units, pressure-pumping equipment, tubular inspection, encoding and pumps, plus capacity expansions for top drives, block preventers, coil tubing and aftermarket services are beginning to contribute.We've also been able to step up our acquisition space over the past 12 months, with Ameron and NKT Flexibles and several other smaller deals. We've announced the acquisition of Wilson Supply from Schlumberger, and we hope to close our acquisition of Interflow, a Canadian manufacturer of well stimulation equipment with over 600 employees within the next few days. All with a view to strengthen NOV's product and service offerings for the benefit of our customers and shareholders for decades to come as the oil and gas industry transitions to a world where energy needs are met by deepwater technology, by horizontal factory drilling and by hydraulic pressure stimulation, into which NOV is the leading technology provider. Read the rest of this transcript for free on seekingalpha.com