The format of today's call will first be an overview by Brian Robinson of our second quarter. Secondly, Greg Kenny will provide comments on the company's third quarter 2012 outlook and full year business trends, followed by a question-and-answer period.Before we get started, I wanted to call your attention to our Safe Harbor provisions regarding forward-looking statements and company-defined non-GAAP financial measures as defined on Slide #2, as we may refer to adjusted operating income and adjusted EBITDA in today's call. To begin, please turn to Slide #5, where we have included a reconciliation of our previously communicated outlook provided on May 1. With that, I will now turn the call over to Brian Robinson. Brian? Brian J. Robinson Thank you, Len. Good morning. We are pleased to report adjusted operating income and adjusted EPS were within our guidance range for the second quarter as each of our segments reported sequentially stronger results. Our businesses in North America and ROW were a source of stability during the second quarter, and in Europe, we continue to help ourselves despite an increasingly more challenging macroeconomic environment. Metal pounds sold for the second quarter increased 2% sequentially and 5% year-over-year but were below our guidance range. Our previously communicated demand expectations for the second quarter failed to materialize due to the impact of the economic uncertainty in Europe and industrial slowdown stalling demand for wiring cable products in North America and the impact of declining metal prices on the buying behavior of electrical distributors and OEM broad customers. Quarterly average copper and aluminum prices drifted lower for the second quarter, declining 6% and 7%, respectively from our previous communication. Otherwise, as you can see on Slide 5, inventory quantity movements and the effective tax rate were generally consistent with our expectations for the second quarter.
On Slide #6, we have provided commentary explaining our second quarter results compared to the first quarter of 2012. The increase in global unit volume of 2% sequentially, relatively stable pricing in North America and ROW and a favorable geographic mix in Europe helped to lift the top line more than 3% sequentially despite the impact of declining metal prices. In Europe, stronger demand for electric utility cables in France and the Mediterranean partially replaced the significant volume at very weak pricing levels reported in Spain during the first quarter.Gross profit and adjusted operating income performance in the second quarter principally reflect the improved performance of the company's telephone and electric utility businesses in North America, strong global aerial transmission project activity, improving domestic conditions in Thailand, mining activity in Chile and ongoing grid investment in France. Other expense for the second quarter of $13.5 million reflects the impact of $10.2 million of mark-to-market accounting losses on economic hedges, which are used to manage currency and commodity risk on our project businesses globally, and $3.3 million of transactional currency losses. Given the numerous currencies in which we transact business around the world and the currency volatility experienced during second quarter, we are pleased with the effectiveness of our hedging program as we reported foreign currency transactional losses consistent with historical norms during the quarter. On the next 3 pages, Slide 7, 8 and 9, we have provided segment information for your reference. First in North America, excluding metal pounds attributable to our telephone and electric utility businesses, volume was up 1% sequentially as industrial and networking demand improved marginally compared to the first quarter. Specialty cables, particularly those used in natural resource extraction, continue to be a source of stability. Year-over-year, excluding metal pounds attributable to our telephone and electric utility businesses, volume was up 4%, as stronger demand for industrial and specialty cables more than offset weaker demand in the company's other North American businesses. Sequentially, second quarter operating income of $38.7 million improved, principally due to the strong performance of the company's telephone and electric utility [indiscernible] specialty cables businesses. Read the rest of this transcript for free on seekingalpha.com