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Q2 2012 Earnings Call Transcript

Operator: Martin Malloy, Johnson Rice.

Martin Malloy - Johnson Rice: On the Fabrication & Manufacturing segment, could you talk maybe a little bit more about some of the domestic opportunities you see out there over the next 12 or 18 months and in particular how you might benefit from facilities being built as a result for the ample supply of NGLs and low price natural gas?

J. M. Bernhard Jr. - Chairman, President and CEO: Well, as natural gas in particular will have a tremendous influence of the ethylene market and there are several of those plans to be built. We look at a lot of chemicals, petrochemical plants, natural gas base expansions in new facilities there, but the piping part of these plants is very, very significant and we are certainly the leading market share. So, it's a good market form in the United States. Brazil is booming, the U.A.E. facility is booked. We are looking at expansion already in Brazil. So the ability to fabricating a pipe on a non-project basis has really started to take off around the world. So, piping is used for all of the market segments from mining to LNG to refineries to solar facilities. So, they have a very good market, and now that we are able to expand the international, they have huge growth opportunities.

Martin Malloy - Johnson Rice: Then, after you get cash in from the sale of the E&C segment, could you talk about thoughts about potential use of that cash?

J. M. Bernhard Jr. - Chairman, President and CEO: We continue to first to focus on acquisitions in the energy segment of the economy, and that's about all of the detail that we can give you now. In the best interest of shareholders, that's probably enough said, but we continue to look at that particular part of the market.

Operator: Scott Levine, JPMorgan.

Scott Levine - JPMorgan: Excluding the charges that you guys posted on the power side and the slight nuclear delay of margins moved up very nicely during the quarter. I think a lot of that was fueled by an increase in Fabrication & Manufacturing. You've talked for a while about expectations of improvement and nice margins as the nuclear work ramps. I am wondering if you could provide some additional color with regard to what the margin trajectory looks like in the back half of the year and perhaps into '13, and some additional color maybe with regard to competition that you seeing within the business and does the pricing in terms on the work you're booking, is that getting better or is it consistent or is it still pretty competitive with regard to what you are seeing on recent quarters?

Brian K. Ferraioli - EVP and CFO: Well, Scott, this is Brian. Let me lead off. As you know, we haven't given and we don't intend to give margin guidance. I think what we have said consistently is that some of the projects in our backlog as they are burning off have had no margin or low margin. So, we had an anticipated margin expansion in general, but beyond that we really don't want to get into much more detail. In terms of the markets, I'll refer to Jim.

J. M. Bernhard Jr. - Chairman, President and CEO: There's always competition in market, but I don't believe that we've seen any extraordinary competition other than we've had over the last two or three years.

Scott Levine - JPMorgan: So you say the level of competition is consistent than what you've seen, no better no worse, just the same?