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At approximately 9:30 when the earnings portion of the conference call has concluded, we will continue with presentations by other senior managers. The webcast will continue through the end of these presentations, which should be at approximately 12 noon. There are two slide decks associated with today’s presentation, which are posted on the Investor Relations section of our website at ir.criver.com. A taped replay of today’s presentations will be available beginning at 2 PM today and can be accessed by calling 800-475-6701. The international access number is 320-365-3844. The access code in either case is 253408. The replay will be available through August 22nd. You may also access an archived version of the webcast on our Investor Relations website.I'd like to remind you of our Safe Harbor. Any remarks that we may make about future expectations, plans and prospects for the Company constitute forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by any forward-looking statements as a result of various important factors including, but not limited to, those discussed on our annual report on Form 10-K, which was filed on February 27, 2012, as well as other filings we make with the Securities and Exchange Commission. During this call, we will be primarily discussing results from continuing operations and non-GAAP financial measures. We believe that these non-GAAP financial measures help investors to gain a meaningful understanding of our core operating results and future prospects, consistent with the manner in which management measures and forecasts the company's performance. The non-GAAP financial measures are not meant to be considered superior to or a substitute for results of operations prepared in accordance with GAAP. In accordance with Regulation G, you can find the comparable GAAP measures and reconciliations to those GAAP measures on the Financial Relations section of our website through the Financial Reconciliations link.
Now I'll turn this over to Jim Foster.James C. Foster Good morning. I’d like to begin by providing a summary of our second quarter results before providing commentary on our business prospects. We reported sales of $285 million in the second quarter of 2012, due primarily to the negative effect of foreign exchange. Reported sales were approximately 1% lower than the second quarter of ’11. Strong dollar impacted sales by 3%, so on a constant currency basis, the sales increase was approximately 2%. PCS business delivered a very good performance in the second quarter with sales increasing 3% over the prior-year on a constant currency basis. We were particularly pleased to see a sequential improvement in PCS sales, up $8.3 million or 8% over the first quarter. The increase was driven primarily by the improvement in In-Life sales, both non-GLP and GLP services and also by the BPS business, which you may recall had a weak first quarter. The strategic partnership which was initiated last November with the global pharma company was a contributor to the In-Life sales growth. RMS segment sales increased 1.2% year-over-year on a constant currency basis, but as expected was sequentially lower than in the first quarter. This was due to a number of factors including the expected seasonal softness in Research Model sales in Europe and Japan, which we noted when we reported our first quarter results. The operating margin increased 20 basis points from the second quarter of 2011 and improved 170 basis points sequentially to 19.4%. The improvement was driven by the PCS business. Although declining 90 basis points year-over-year sequentially, the PCS margin increased by 420 basis points to 13.1% primarily due to higher sales. The RMS margin benefited from an insurance payment we received related to the 2011 earth quake in Japan and offset a decline due primarily to lower sales of large models.
As a result, the RMS margin was 32.8%, 20 basis points over the prior-year and just 50 basis points below the outstanding first quarter performance. Earnings per diluted share increased by 7.1% in the second quarter of 2012 to $0.75 per share from $0.70 in the second quarter of ’11. The EPS increase was driven primarily by the lower number of shares outstanding.Read the rest of this transcript for free on seekingalpha.com