Operator: Good afternoon. I'm Stephanie, the Chorus call operator for this conference. Welcome to the ABB Second Quarter 2011 Results Analyst and Investors Conference Call. Please note that for the duration of the presentation all participants will be in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. A podcast of this call will be available for one month following the conference. This call must not be recorded for publication or broadcast.
At this time, I would like to turn the conference over to Mr. Joe Hogan, CEO of ABB. Please go ahead, sir.
Joseph Hogan - CEO: Thank you and good morning everyone and thanks for joining the discussion today. As always my comments in this call refer to the presentation that you can download from our website at abb.com. Please refer to Chart 2 for our Safe Harbor text covering any forward-looking statements we want to make today.
So, let me start with a summary of our first quarter performance on Chart 3. This is a strong quarter where we continued to execute well driving further revenue growth, cash generation, and a solid increase in shareholder returns.
Our recent acquisition, especially Baldor Electric, have so far proved their value with solid contributions to both the top and bottom lines. Orders were up 10% on an organic basis and totaled almost $10 billion, including acquisitions with a strong performance out of emerging markets like India and Brazil, both up almost 40% this quarter.
China also continued to grow, driven mainly by the Automation businesses. Revenues were higher in all divisions and we were pleased to see the growth momentum continue in car products where we returned to a positive territory for the first time in two years. We generated a 22% increase in operational EBITDA to about $1.5 billion, resulting in an operational EBITDA margin of 16%. This represents a slight decline from the high levels of a year ago and I'll come back to that, the reasons for this later on.
Net income is up more than 40% this quarter and cash flow rebounded strongly from the first quarter and is up more than $200 million compared to the second quarter of 2010. Last but not least our balance sheet is still among the strongest in the sector with net cash of more than $1 billion. Moody's recognized the stability of our financial position with an upgrade to A2 from A3, and we successfully launched two U.S. dollar denominated bonds in the quarter raising about $1.25 billion in new long-term funding at attractive interest rates.
Chart 4 gives you an overview of the key figures for the quarter. I have already discussed the main points. About $600 million of revenues and $115 million in operational EBITDA in the quarter came from acquisitions, mainly Baldor. But even excluding that contribution, orders were up 10% on a local currency basis while revenues were 9% higher.
Our order backlog remained at very high level, close to $30 billion and we reported a very attractive increase in earnings per share in the quarter and an improvement in the conversion of operational earnings to the bottom line. We reported restructuring related costs of about $30 million in the quarter and a positive impact from hedge accounting of derivative transactions of about $60 million.