Greetings, and welcome to the Quaker Chemical Corporation's Second Quarter 2013 Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Michael Barry, Chairman, Chief Executive Officer and President for Quaker Chemical Corporation. Thank you, Mr. Barry. You may now begin.

Great. Thank you, Jesse. Good morning, everyone. Joining me today are Margo Loebl, our CFO; and Robert Traub, our General Counsel. After my comments, Margo will provide the details around the financials, and then we'll address any questions that you may have. We also have slides for our conference call. You can find them in the Investor Relations part of our website at www.quakerchem.com. I'll start it off now with some remarks about the second quarter. Overall, I am pleased to be able to report that we had a solid quarter, and we did so in a challenging environment. Let me now try to give you a sense of what we experienced in the quarter, and I'll start with sales. Our overall sales were up approximately 5% for the quarter versus 2012, as well as versus the first quarter of 2013. Our volume showed similar growth. We believe our business strategies are largely responsible for these results, as we are benefiting in 2 ways: one, we continue to benefit from our recent acquisitions; and two, we have grown our volume by executing our business strategies and taking share in the marketplace. So the combination of both the acquisitions and new organic growth is the reason we have continued to do well under difficult circumstances. Going around the regions. Europe is one of our most challenging regions, relative to the industrial market conditions. However, sales were actually up approximately 5%. This excludes the impact of our acquisition of NP Coil Dexter from 2012, which added an additional 5% growth in Europe. We are fortunate that we have been able to pick up share in the marketplace, which has helped us to more than offset the inherent auto and industrial market declines in the region, which we estimate to be 10% or…

Thank you, Mike. Good morning, everyone. Turning to the financial portion of the call today, I will reiterate that Quaker continues to deliver solid results in the second quarter of 2013, despite a difficult global economic environment. Quaker announced net sales of $184.8 million for the second quarter of 2013, up approximately 5% compared to the second quarter of 2013 net sales of $176.8 million. Earnings per diluted share for the second quarter 2013 were $1.22 compared to $0.85 for the second quarter of 2012. For the first 6 months of 2013, the company reported net sales of $361 million, up approximately 2% compared to the first 6 months of 2012 net sales of $354.4 million. Earnings per diluted share for the first 6 months of 2013 were $2.26, compared to earnings per diluted share of $1.80 for the first 6 months of 2012. In the past few quarters, I note that we have started to provide a non-GAAP earnings per diluted share table in an effort to provide shareholders with visibility into the Quaker operation, excluding certain items, which we believe do not reflect our ongoing operation. Particularly, knowing our captive insurance company, Primex, was not indicative of our ongoing operations and will continue for the foreseeable future, our preference was to lay out these non-GAAP measures for you. I will walk you through our approach to non-GAAP adjustments in yesterday's earnings release. Please note that non-GAAP earnings per diluted share were $1 for the second quarter of 2013, compared to $0.90 for the second quarter of 2012. The adjustments to get to non-GAAP earnings per diluted share include: in the second quarter of 2013, $0.14 per share related to the recovery of a mineral oil excise tax refund in related interest; $0.13 per share related to equity income…

Thanks, Margo. At this stage, we'd like to address any questions from any participant on the conference.

[Operator Instructions] Our first question is coming from the line of Laurence Alexander with Jefferies.

I guess, just a couple of questions. First, just a rather simple one. When you look at the product volume by quarter slide, I guess that's number 4, there seems to be a pattern of the Q3 volumes being flat to slightly up from Q2. I just wanted to get your sense of how we should think about that cadence? I mean, are you seeing -- and also, given the jump you've seen in Q2, any end markets or regions where you're seeing a sequential acceleration right now? I mean, above normal seasonality?

Sure. I mean, second quarter, it's hard to tell from that slide. Like, for example, in the second quarter of last year, I guess early July of last year, we made an acquisition in Europe that would've increased the third quarter versus second quarter last year. But in general, I think the second and third quarters are traditionally our better quarters of the year, from a volume perspective, because there tend to be less holidays. In the first quarter and fourth quarter, you tend to have more holidays in the mix. And then as far as the regions right now, I really -- I don't see -- as far as an acceleration or changes in any region, I don't -- we don't expect major changes one way or the other. I'm just thinking of steel production and the various regions around the world or auto production and we don't get a sense that any of the regions right now are, let's say, accelerating around the world.

And then, I guess just secondly, as you think about the types of projects your customers are asking you to work on, are you seeing any shift or negative mix effects or attempts to move to lower-cost solutions? Or what's -- are there any themes in terms of the types of R&D they're asking you to do?

Well, our customers, for the most part, especially if you look at our steel business, our steel customers are not very profitable at this point. So those customers are, at times, asking or looking for other solutions, which can kind of do the same or similar type of things at a cheaper cost, but they have to be careful. We have to be careful with that, as well as recommending, because our products provide a certain value to the customers in their process. So -- but there could be opportunities, there could be chances a customer may be just wanted to cut cost so much, that they could want to switch to a lower-cost product.

Okay. And then just lastly, are there any structural reasons or comments from your customers that require you to maintain a fairly strong balance sheet? Or are you sort of rethinking your attitude on sort of your balance sheet strength, given -- or leverage levels, given where interest rates are?

Right. No, there's no customer constraint from that perspective. Certainly, we have -- our balance sheet is under levered at this point. And we -- our goal is to make acquisitions and we continue to look at opportunities to make acquisitions. But obviously, if we did not find adequate acquisitions over time, we have to find other ways to use that balance sheet to provide a value for our shareholders.

Our next question is coming from the line of Daniel Rizzo with Sidoti & Company. Daniel D. Rizzo - Sidoti & Company, LLC: You indicated that you want to see contracts bid on, which is great. Can you tell us how many additional contracts you'll be bidding on this year? Or is that something you can't disclose?

I don't have it's -- I don't have a lot of information in front of me, but it's really, generally, anytime a new mill comes up for -- gets commissioned, we are part of that process, as a general statement. So in general, I would say in the past few years, if I just give rules of thumb, you tend to have maybe 10 to 15 type of new mills being built around the world. And, of course, the majority of those mills right now are being built in the Asia-Pacific region. So a lot of them going in into the Southeast Asia or China, India, that -- those areas. Daniel D. Rizzo - Sidoti & Company, LLC: Okay. And then, the last couple of quarters, SG&A as a percent of sales has been about 25%. Is that the type of run rate we should think of when -- just modeling out forward?

Yes. I think if you look at our long-term averages, that's not a bad indication. Quarter-to-quarter, you can have fluctuations. We mentioned a number of things that were in this quarter, that might have been a little more unusual. But yes, if you look at the longer-term trends, that's not a bad indicator.

The next question is coming from the line of Liam Burke with Janney Montgomery.

Mike, you talked about market share gains and, as did Margo. Are you seeing market share gains in both the legacy Quaker product as well as acquisitions? And have you seen any competitive response with price?

We -- on the first question as relative to -- yes, it's basing on our base business rather than, as far as market share gains, the way we think of it. So we are picking up pieces of business around the world, different mills, maybe that we haven't had historically. So we continue to do that in our core businesses. And then, as you mentioned, we are -- continue to pick up new pieces of business relative to the acquisitions, the new technologies that we purchased over the past 3 years, where we brought in kind of new 4 -- 4 new different kind of new technologies in our product portfolio that we didn't have before. So we're kind of growing in both those areas right now. And as far as price, there's always a competitive environment, and there's always things going on. Generally, we -- our goal is certainly to sell on the value and the total offering that we're making and the value we can provide to the customers at a price. But sometimes, the customers or the competitors will try to maintain share and drop their price, that's for sure.

Okay. And the pipeline on acquisitions, is it maintaining itself? Or are you seeing a slowing or building up?

We're going to keep continuing to go down a lot tracks. I don't think there's anything right now that's imminent, but we continue to have discussions and continue -- and hold different -- looking at our different segments of business and different geographies, to have those conversations and all up. Acquisition is it takes 2 people to make it work. And so you never know when that is going to happen. But it's something we're very actively working on in a lot of different fronts.

Our next question is coming from the line of Summit Roshan with KeyBanc.

Just a quick one on raw materials. You had noted that you saw some indications that might be trending up in the second half. Is that largely just on the back of crude oil being up over the last month or so? And then if you could remind us, how much of your raw materials is tied to the petrochemical chain?

Well, we have -- we kind of major -- 3 major buckets of raw materials, the way I think about it. You have mineral oils, which is the big chunk, but less than 50%. And then you also have animal fats and vegetable oils. And you're right, crude has gone up a little bit. We don't know what that will translate into a higher mineral oil prices. Generally, it will over time. We have seen some on the animal fat market, some increases going on. And then vegetable oils, it's been a relatively good run for them. They've been good pricing, but we see -- we sense some tightening, especially like in coconut oil. But so -- and then when I think about another aspect of this, as you know we have indexes, as well with our -- some of our customers, and you kind of have these lag effects in indexes as things kick in. When you put all of that together, we kind of definitely see some of our raw materials potentially here going up in the third and fourth quarters, and putting some pressure on our margins. And one thing, I'd just reiterate some things I've said in the past about our gross margins is that long term -- longer term, we expect to have gross margins in the 35% range. And now, we're slightly above that.

Okay, great. And If we go back to kind of taking market share, you've done generally well in Europe here. Can you maybe give a little bit more color on maybe why that's Europe's specific story? Maybe why that type of level of market share gains haven't translated into say, North America or Latin America?

Well, we have taken share. You have to look at your, kind of some of these time periods we're talking about. So if I look back in North America, in particular, over the past several years, we have taken some really nice share in our core steel markets and the mining markets. So sometimes when you look at a quarter-to-quarter thing, you kind of -- it doesn't kind of show up, but if you look at the longer term, and if you look at the longer term or the medium-term perspective in all these regions, we have, in every region in the world of taking share. I think in this case, with Europe is that we've gotten some nice pieces of business that were significant in nature that a lot of thoughts that the inherent demand loss in that market.

[Operator Instructions] Our next question is coming from the line of Scott Blumenthal with Emerald Advisors.

Just one question for you, Mike. You mentioned that price and mix drove sales down a little bit during the quarter, less than 1%. Can you identify any products, geographies, where you might have actually had negative pricing?

Well, we certainly have index contracts around the world. It was different customers, and some of those can go up or down. I don't have that information in front of me, per se, but sometimes when a customer is buying a certain product and that product has a certain raw material, predominant raw material in it, that -- maybe that raw material went down in one quarter, you can see negative pricing. So I don't have any real specifics around pricing per region or anything like that.

But that would be specific to a particular raw material and not necessarily an indication of the end demand in your market?

Right. That's correct.

It appears there are no further questions in queue at this time. I would like to turn the floor back over to management for any concluding remarks.

Okay. Given that there are no questions, we'll end our conference call now. And I want to thank all of you for your interest today. We are pleased with our results for the second quarter and we continue to be confident in the future of Quaker Chemical. Our next conference call for the third quarter results will be in late October or early November. And if you have any questions in the meantime, please feel free to contact Margo Loebl or myself. Thanks again for your interest in Quaker Chemical.

Thank you. Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation.