Operator: Good morning. Welcome to the Cemex Second Quarter 2012 Conference Call and Video Webcast. My name is Jesania and I'll be your operator for today. At this time, all participants are in a listen only mode. Later, we will conduct a question-and-answer session. Our host for today Fernando Gonzalez, Executive Vice President of Finance and Administration and Maher Al-Haffar, Vice President of Corporate Communications, Public Affairs and Investor Relations.
I’ll now turn the conference over to your host Fernando Gonzalez, please proceed.
Fernando A. Gonzalez - EVP of Finance and Administration: Thank you operator and good day to everyone. Thank you for joining us for our second quarter 2012 conference call and video webcast. After Maher and I discuss the results of the quarter, we will be happy to take your questions.
We are quite pleased with our 22% growth in operating EBITDA on a like-to-like basis on back of a 1% growth in consolidated net sales. This is the highest EBITDA generation since the third quarter of 2009 and the fourth consecutive quarter with a year-over-year EBITDA increase. Improvement in pricing and volume in several of our regions, as well as the continued success of our transformation effort has led to the highest operating EBITDA margin in almost three years.
Infrastructure and housing continued to be the main drivers of demand for our products.
Regarding our consolidated volumes, we had strong contribution from our U.S., South, Central America, and the Caribbean and Asia regions.
In the case of Colombia, Panama and the Philippines, we sold record cement volumes during the first half of the year. The favorable volumes from this regions, partially mitigated the declines we experienced in Mexico, Northern Europe and the Mediterranean regions. Prices for domestic gray cement and ready-mix were stable sequentially in local currency terms with aggregate prices down 2%. Although we’re substantially recovering short-term input cost inflation, we continue to be at levels below our targeted return on capital employed.
On this front, as an important component of our transformation, we are introducing an initiative that will drive a change in our business mindset, executing a value before volume strategy. This means that we will be focusing on value enhancement, efficiency gains in our customer relationships, ensuring sustainability of our products, and generating returns sufficient for reinvestments. Under this strategy, we will establish our own internal procedures, guidelines, standards, principles, and tools which will support our approach to cement pricing. We aim to recover our cost and obtain an adequate return on investment in our cement business.
Experiences from our cement pricing approach will be transferred to our ready-mix and aggregates business in due course. This initiative is global in scope and in Europe; we are in the implementation phase, while in all other regions we are in the evaluation stage.
In Europe, a new price system following a gross minus logic will be introduced to determine prices and to ensure consistent price differentiation to customers. Furthermore, in order to deal with input cost volatility we will introduce surcharges, like transportation fuel and environmental cost, depending on the country.