At this time, I would turn the call over to our President and CEO, John Shanahan, who will recap the highlights for the first 6 months ended June 30, 2012. Following his remarks, Doug Miller will provide an update of our operations, and I will walk through the financials. And John will wrap up with the outlook before we finish with your questions. John?John G. Shanahan Thank you, Ken. Welcome, and thank you for your participation today. I have a few quick comments, which I would like to make. I hope I'm not going to be stating or restating the obvious. But it may answer a few questions before we get into the Q&A session. I think firstly, I think we always acknowledge that we do have variations in our production quarter-to-quarter. We are disappointed when we don't hit our objectives. The second quarter was difficult for a number of reasons. The main reason was, of course, the unseasonally high rainfall and snow melt that we had to contend with. The record levels of rainfall in May and early June did hamper us. Now, while the rest of the country seemed to be experienced record heat and battling forest fires, Northwest Montana saw the exact opposite. You may recall from our first quarter investor call, back in April when we did actually discuss the upcoming runoff and our VP of operations, Doug Miller, spoke about the upgrades that we had made and felt that we are in a fairly good position, but we didn't quite expect the deluge that we did get in May and June which hampered us. But we were able to continue productions, to get some production out of the C, A and Lower Quartzite areas. So I'd like to focus on a couple of positive things that did happen both this quarter and for the first half of the year. We did operate cash flow positively for the second quarter and have continued to operate cash flow positively for a number of quarters. The second quarter of 2012, our cash flow from operations was around $3.5 million. After the first half of this year, it sits at around $11 million, which is very much where it was at this time last year.
We continued to build cash and strengthen our balance sheet. The second quarter was still positive from an EBITDA basis. This was despite what was a quite a spendy quarter with regards to development work at Troy and Rock Creek. I'd also like to point out that during the quarter, we were able to maintain and put to bed the ongoing seconds and final invoices that come in from previous months. I think, as everyone knows, as metal prices decline, and still, $27.50 silver and $3.40 copper are still very good prices, but we've got to go back and re-price and settle those up. So during the second quarter, those happened as well, and we're very much up to date and continue to manage that quite well.Our production, of course, is a function of access. Not any systemic issues, upgrades or reserves or metallurgical recoveries. In fact, Doug will probably point out a little bit here, some of the areas that we were mined in the second quarter were either right on or below cut-off grade and not held in reserves. So it's due to the experience of our workforce, the development work that has been done at the Troy Mine, our cost structure, we did turn some negatives into a positive. And I say this with confidence. So far, this quarter, the third quarter now to date, we're back on plan, upgrades are where they need to be and where we want them to be. Without doubt, there will be some other hiccups along the way and operating challenges. But we do have the experienced workforce and committed workforce to get us through. Read the rest of this transcript for free on seekingalpha.com