I’ll turn the call over to Bob Archer, Great Panther’s CEO.Robert A. Archer Thank you, Rhonda. Good morning everyone, and thank you for joining us. Before I speak to our actual financial results, I would like to note a few key operational takeaways from the second quarter. The overall metal production in Q2 was effectively flat quarter-over-quarter, but this is expected to increase in the second half of the year. The drought conditions throughout Central Mexico, which impacted our operations at Topia ended in June, but for the majority of the second quarter we were forced to cut back our plant throughput and stockpile of ore that is being processed now. Although this resulted in a 1% decrease in overall metal production when compared to the second quarter of 2011, Topia’s silver production actually reached a record 148,439 ounces in the quarter. Overall gold production increased by 22% from a year ago thanks to steady production from the Santa Margarita vein at Guanajuato, and the plant at Guanajuato achieved record recoveries of 91.1% for silver, and 92.3% for gold due to the addition of a regrind mill. We are confident that a number of the operational developments and efficiencies that have been put into place will prove beneficial to the growth in production in the second half of this year. For instance, the Guanajuato mine complex is now operating on a 7 day week instead of a 6 day week, and that will allow for increased equipment utilization and production. In the Cata mine at Guanajuato, the sill pillar will be recovered at the 470 meter level, and in the plant a new double-deck crushing screen became operational in June, which should further improve our recoveries. Now let me shift into some of the key financial results from the quarter. You have been hearing on earnings calls throughout our sector that revenues have been impacted by lower silver prices and rising costs industry wide. Although our revenue growth was essentially on target, like our peers our gross profit was impacted by lower silver prices and higher smelting and refining charges.
On top of that, we realized higher than normal amortization and depreciation charges due to the substantial investments we recently made in our mines and in plant upgrades and equipment purchases. Furthermore, the majority of our 2012 Capex budget was spent in the first half of this year. As such, from the first to the second quarter of 2012, gross profit decreased by 2.6 million or 40% mainly due to the decrease in the silver price and a 58% or 0.8 million increase in depreciation.In the second quarter revenues increased 69% over the same period last year to 14.4 million. As noted earlier in the year, we have secured contracts for the sale of all of our planned 2012 concentrate production and to date have not experienced any concentrate backlogs as we did last year. When compared to Q1 of this year, revenue for Q2 increased by 0.8 million or 6%. Although production for the second quarter was relatively consistent with the first quarter, the increase in revenue came from concentrate shipments that were in transit at the end of the first quarter, which we recognized in this quarter, albeit, offset by a 14% decrease in silver prices. Another important and related item that I will address is the reduction in our cash position. During the second quarter, our cash balance went from 40.3 million at March 31 to 28.7 million at June 30, 2012. The primary factor for the decrease was the timing of payments on concentrate shipments during the second quarter. Under our existing contract with a European smelter, there is a long lead time for payment, resulting in a temporary drawdown on cash, but an increase of 8.5 million in accounts receivable. Read the rest of this transcript for free on seekingalpha.com