Good afternoon. My name is Stephanie and I'll be your conference operator today. At this time, I would like to welcome everyone to the M/I Homes second quarter conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions) I would now like to turn the conference over to Phil Creek. Please go ahead, sir.

Thank you. Thank you for joining us today. On the call is Bob Schottenstein, our CEO and President; Tom Mason, EVP; Paul Rosen, President of our Mortgage Company; and Marie Hunker, our VP Corporate Controller; and Kevin Hake, Senior VP. First, to address regulation fair disclosure, we encourage you to ask any questions regarding issues that you consider material during this call, because we are prohibited from discussing significant non-public items with you directly. And as to forward-looking statements, we want to remind everyone that the cautionary language about forward-looking statements contained in today's press release also applies to any comments made during this call. Also, be advised that the Company undertakes no obligation to update any forward-looking statements made during this call. With that, I'll turn the call over to Bob.

Thanks, Phil. Good afternoon and thank you for joining our call today. The second quarter was a strong quarter for M/I Homes as we continue to make solid progress on many fronts. As stated in our release, we're very pleased with our improving results led by revenue growth, margin expansion, improved profitability and strong sales. For the quarter, we earned $7.3 million, a 128% increase which is more than doubling the $3.2 million we earned in last year's second quarter. For the first six months, we had net income of $11.9 million, significantly greater than last year and our net income for the first half of this year exceeds the amount we earned for all of last year. We remain very pleased with our sales performance. New contracts for the quarter increased 31% over last year and for the first six months, we have now sold 2,125 homes, a 34% increase over 2012. Our average sales price of homes and backlog increased to $293,000, up from $274,000 a year ago. The net result of our improved sales and increase in average sales price is the June 30 backlog of 1,675 homes, 43% more than a year ago with an aggregate sales value of $491 million, 53% greater than a year ago. We continue to be pleased with our new communities and our community openings. Our community count at quarter's end was 13% greater than year ago. During the first half of 2013, we successfully opened 30 new communities and we are on track to open approximately 40 more new communities during the second half of the year. Thereby resulting in an approximate 25% increase in communities by year-end and we projected our Southern region led by our growth in Texas will be having the most new communities. Our balance sheet…

Thanks, Bob. New contracts for the second quarter increased 31% to a 1,078 with a net absorption rate of 2.6 sales per community per month versus 2.2 a year ago and our traffic for the quarter was at 12%. Our sales were up 53% in April while traffic was down 1%. Our sales were up 36% in May and traffic was up 6% and our sales were up 3% in June and traffic was up 35%. As to our buyer profile, 38% of our second quarter sales were first home buyers compared to about 44% in the first quarter and 45% of our second quarter sales were spec sales about the same percentage as the first quarter. Our active communities increased 13% from 124 at the end of June last year to 140 this year. The breakdown by region is 65 in the Midwest, 40 in the South and 35 in the Mid-Atlantic. During the quarter, we opened 15 new communities while closing 10. Our current estimate is to end the year with about a 25% higher community count than we began this year opening about 70 new communities this year. We delivered 788 homes in 2013 second quarter, delivering 57% of our backlog this quarter compared to 67% a year ago. Our cycle times have increased slightly due primarily to sub-supplier issues and slower local permitting and approval processes. However, closing price for the second quarter was 281,000; a 9% increase over last year's 259. Revenue increased 37% in the second quarter result from the increase in deliveries and the average closing price along with strong results from our financial services operation. In the second quarter, we've recorded pre-tax charges of $1.2 million for impairment. The second quarter charges were for older land assets in our Midwest markets. We…

Thank you, Phil. Our mortgage and title operations pre-tax income increased to $3.8 million in 2013's second quarter from 2012's $1.9 million. Our second quarter results included increased income attributable to an increase in loans originated higher average loan amounts, higher margins on the loans sold. We also benefited from increased revenue from our loan servicing portfolio. The loan-to-value on our first mortgages for the second quarter was 87% in 2013, the same as 2012 second quarter. We continue to see a shift towards conventional financing 65% of the loan closed were conventional while 35% were FHA, VA. This is compared to 52% and 48% respectively for the 2012 same period. Overall, our average mortgage amount increased 3% to $234,000 in 2013 second quarter compared to $228,000 in 2012 second quarter. The average borrower credit score on mortgages originated by M/I Financial was 738 in the second quarter of 2013, compared to 734 in 2013's first quarter. Mortgage operation captured approximately 77% of our business in the second quarter, compared to 2012's, 84%. At June 30, 2013; we had $41 million outstanding under the MIF credit agreement which expires March 28, 2014 and $9 million outstanding under a separate $15 million repo facility which expires November 12, 2013. In the normal course of business, we receive inquiries from investors concerning underwriting matters on specific mortgages purchased from us. We thoroughly review and respond to each inquiry and in some situations we engage an independent third party to review the files and information related to the origination of the mortgages in question. Our reserve at June 30, 2013 with respect to these matters was $2.8 million compared to $2.3 million at December 31, 2012. M/I Financial has not repurchased any loans this year. Now, I'll turn the call back over to Phil.

Thanks, Paul. As far as the balance sheet, we continue to manage our balance sheet carefully focusing on investing in new communities, while also managing our capital structure, total home building inventory at June 30, 2013 was $615 million, an increase of $93 million over prior year levels, the increase is due primarily to higher investment in our sold backlog. Our unsold land investment at June 30, 2013 is $271 million, a 16% increase compared to $234 million a year ago. Compared to a year ago raw land and land under development increased 49% and finished unsold lots decreased 11%. At June 30 we had $155 million of raw land and land under development and $116 million in finished unsold lots. We own 2400 unsold finished lots with an average cost of $48,000 per lot. And this average lot cost is 17% of our $293,000 backlog at resale price. And the market breakdown of our $271 million of unsold land is $94 million in the Midwest, $101 million in the sound and $76 million in the mid-Atlantic. Lots owned and controlled as of June 30, 2013 totaled 17,200 lots, 51% of which were owned and 49% under contract. We own 8700 lots of which 39% are in the Midwest, 42% in the south and 19% in the mid Atlantic. Our owned and controlled lots at 17,200 is an increase of 62% versus a year ago. We believe we have a very good solid land position. During 2013 second quarter we spent $56 million on land and $21 million on land development for a total of $77 million. Year-to-date we have spent $137 million on land purchases and land development. And as to our 2013 land purchases year-to-date, about 44% were raw land deals, 27% were finished lot pickups under option contracts and 29% have been [booked] finished lot purchases. Our estimate today for total 2013 land purchase and development spending is approximately $300 million to $350 million including the $137 million we spent year-to-date. At the end of the quarter, we had $86 million invested in specs, 168 specs that were completed and 535 specs under construction. This translates in to about five specs per community and of the 703 total specs, 260 were in the Midwest, 234 were in the Southern region and 209 are in the Mid-Atlantic and at June 30, 2012, we had 578 specs with an investment of $68 million. Our financial condition continues to be strong with $179 million of cash at quarter end and at June 30, the company had no borrowings under our credit facility and as we announced last week, we closed on a three-year, $200 million unsecured revolving credit facility, which will provide us with additional financial flexibility as we move forward. This completes our presentation. We will now open the call for any questions or comments. Stephanie?

(Operator Instructions) Your first question comes from the line of Alan Ratner with Zelman & Associates. Alan Ratner - Zelman & Associates: Hey, guys, good afternoon.

Hi, Alan. Alan Ratner - Zelman & Associates: I appreciate all the commentaries especially around the recent trends, which everybody is focused on, just as far as June is concerned, and I went back and checked from the notes here and it looks like you guys were up against a really difficult comparison in the year ago. I think the orders were up over 50% in June and that looks like you, as the toughest comp in the quarter. And one other things that struck me was that your traffic was still sell out 35% year-over-year in June. So I was hoping that may be you can comment a little bit more on that and whether the increased traffic and obviously the tough comps still gives you some confidence that the market remains on firm footing despite, overhearing from some other builders regarding that flowing obviously from higher rate?

Well, Alan great question and thanks for looking back. We appreciate it. And I think that's an insightful point that said, we standby what we said in our remarks and as number one, this is summer, typically we do see somewhat of a slowdown, the suggested interest rates had no impact, is I think not accurate, to suggest that they have a material impact was also not accurate, they've had some impact and certainly we have been raising prises and we also knew we run a tougher comp. Then as I said, we remain optimistic. We believe housing markets generally are very healthy, will continue to improve, perhaps in a slightly more moderate or uneven pace and then we have seen January through May and even though it's very difficult to try to give guidance mid-month and we're certainly not in that business. 3 weeks into July as I said our sales are improved over the last year. So we're excited about the business, we're forever cautious just because you have to be in this business that we're a lot more optimistic than we are not and we look forward to the rest of this year. We feel it's good about our footprint and our communities within our markets is we have for a long, long time and we think that housing conditions generally are getting better. Alan Ratner - Zelman & Associates: Understood, I appreciate that. And I guess then just on the strong traffic you're continuing to see or at least the increase, curious if you might have any thoughts you could share from your field operators, because it sounds like that people are still coming out. So are the higher rates, people saying they're just can sit on the side lines and wait to see what happens for more clarity or do you feel like that the traffic number maybe doesn't reflect the slowdown you are witnessing and maybe we shouldn't read too much into that?

Well they're all been forever watchful, because it hasn't been long since, whatever was that we experienced not that long ago. But we feel good about the business and we feel good about the rest of the year and we think there is good demand and then there is good traffic and we may see little spikes up and down here and there. But we think that then a longer view from quarter to quarter as opposed to month to month. I think we'll be much more telling in terms of supporting the belief, that housing, the new home sales will continue to improve.

And I think another point Alan, also, this is Phil, when you look at the 15 communities that we opened in the second quarter kind of the way it worked out is that the big majority of those were right at the end of the second quarter we really did not get that many sales up of those new communities. So again opening 15 to first and 15 to second and then second we are going to open 40 plus in the second half is very exciting to us, so we are excited about our outlook. Alan Ratner - Zelman & Associates: Great, thanks a lot, good luck.

Thank you.

(Operator Instructions) Your next question comes from the line of Alex Barrón with Housing Research. Alex Barrón - Housing Research: Hey, guys. How are you doing?

Good, Alex. Alex Barrón - Housing Research: I wanted to ask regarding your conversion rates, I have expected you guys to show a lot more operating leverage this quarter, but I think a lot of that it had to do with any bit of the short fall and closing then I am looking at the conversion rate, I don't see any other quarter anytime in the recent history where you've I guess delivered such few homes growth out of your backlog, so I was wondering if there was something there, why you think that slowed down a bit?

Well, Alex assuming that, if we help the close if you more, the answer is yes, we were in that 60% range about three and four years ago, again we hope to get better. As we said in the call and in our comments, we have in our types of time increased slightly, there is obviously been some issues in our industry you all know with some of suppliers frameworks those type of people, so we have our business certain situations not get to the system as we would like. Also some of the local municipalities which have their own economics staffing issues you know getting approvals done, getting permits done, you know some of those things have slowed us down a little bit, but again you know we do feel good about where we are, the increased profitability, our margins, our average sale price is continuing to move up a little bit. Obviously we hope to close a lot of houses you know second half of this year with our backlog about 500 homes higher than it was a year ago. We think we are making some progress now in cycle times but some of those things have impacted us. Alex Barrón - Housing Research: Okay, yeah, I guess, I think a lot of the operating leverage will price in the second half. As far as the corporate SG&A I guess that seems to continue to climb every quarter, was there something the increase this quarter that was headcount or what was that related to?

We've had some increases in our headcount due to our growth. We've also had some increase in incentive compensation due to our improved profitability and we are already making more money than we made all of last year, that's been an impact and again just some cost, you know corporate marketing and you know corporate systems you know when you add additional divisions and those type of things that does generate some more people and cost, but no nothing related to unusual, just growing.

We have a follow-up question from Alex Barron with the Housing Research.

I guess just to elaborate a little bit more on the recent trends and sales in regards to the interest rates. If these rates kind of stayed here, they don't come back down or mainly they even climb higher. How are you guys positioned? How are you thinking about it from either, do you not raise prices anymore? Do you increase incentives? Do you just kind of wait and see what happens? How are you guys thinking about that?

Well, we think about all this time. I am not sure that we can anything more than what we've already said Alex and I wish I could maybe say something different but there is really nothing more to say other than. In terms of where interest rates are and where they might go, we believe that for the foreseeable future that the markets remain healthy and that housing conditions are good and are likely to remain so and we're looking to have a strong year this year and we're looking to continue to grow on our markets. And by any historical standard, rates are outstanding today and we think that they will remain as very, what I would call, affordable levels at least for the foreseeable future. But there is no way to know and we will manage it as it comes and in terms of what we believe and how we see the business, what we're optimistic.

(Operator Instructions) At this time there are no additional questions in queue.

We appreciate you joining us. Look forward to talking to you in next quarter.

Thank you. This concludes today's conference. You may now disconnect.