Good day, everyone, and welcome to the Ocean Power Technologies first quarter 2011 audio webcast. Today's conference is being recorded and webcast. At this time, for opening remarks, I would like to turn the call over to the chief financial officer of Ocean Power Technologies, Mr. Brian Posner.

Thank you. Good morning, and welcome to Ocean Power Technologies audio webcast for the first quarter, ended July 31st, 2010 of our fiscal year ending April 30th, 2011. Today, we issued our earnings press release and will file our quarterly report on Form 10-Q with the Securities and Exchange Commission. Our public filings can be viewed on the SEC Web site at sec.gov or you may go to our Web site, oceanpowertechnologies.com. I will be joined on today's webcast by Charles Dunleavy, our chief executive officer. Please advance to slide two. During the course of this conference call, management may make projections or other forward-looking statements regarding future events or financial performance of the company within the meaning of the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. As indicated in the slide, these forward-looking statements are subject to numerous assumptions made by management regarding future circumstances over which the company may have little or no control, and involve risks and uncertainties and other factors that may cause the actual results to be materially different from any future results expressed or implied by such forward-looking statements. We refer you to the company's Form 10-K and other recent filings with the Securities and Exchange Commission for description of these and other risk factors. I'll now turn the call over to Charles Dunleavy.

Thank you, Brian. And thanks to everyone who has joined us for today's webcast. On slide number three, I'd like to note the highlights of our first quarter. OPT made a strong start for this fiscal year with an increase in revenue, compared to the same period last year as well as an increase in contract order backlog to $6.5 million, which is higher than both the previous quarter and the same period last year. In addition, we continued to make important advancements in our core PowerBuoy technology. The system's integration of our first PB150 PowerBuoy in Scotland is approaching completion, while the manufacturing of our second PB150 for our project in Reedsport, Oregon is on schedule. Just after the end of the quarter, OPT signed a significant agreement with a broad array stakeholders for our utility scale 10-PowerBuoy wave power project we expect to be grid-connected in Reedsport, Oregon. This agreement marks an important step towards the granting of the first-ever Federal Energy Regulatory Commission license for a commercial scale wave power project in the US. The development of our next generation PB500 device also gained momentum with our receipt of new funding from the Southwest of England Regional Development Agency or SWRDA. Our 40-kilowatt rated PowerBuoy in Hawaii continued to perform well in the ocean and reflects the strength of our engineering capability and core PowerBuoy technology. We also strengthened our management team with the appointments of Brian Posner as chief financial officer and Michael Kelly as vice president of operations. These appointments served to broaden our capability for commercial execution of our business strategy. Further, the new vice president of operations role at OPT underscores our transition to commercial status by separating manufacturing and marine operations from engineering. Let me now take you through these developments in…

Thank you, Chuck. As you will see on slide 10, our revenues increased 5% for the first quarter of fiscal 2011 to $1.4 million, compared to $1.3 million for the same period in the prior year. This growth primarily reflects an increase in revenue from the US Navy under the LEAP program. In addition, there was an increase in revenue related to OPT's projects in Scotland and Reedsport, Oregon. The growth in revenue generated by these projects was partially offset by the decline in revenue from OPT's DWADS program with the US Navy, our utility scale project in Spain, and the company's PowerBuoy project at the Marine Corps base in Hawaii. Cost of revenues increased to $1.6 million for the quarter as compared to $1 million for the same period in fiscal 2010. This increase primarily reflected a higher level of activity related to the LEAP program with the US Navy and our PB150 projects in Scotland and Reedsport, Oregon. Gross loss was approximately $214,000 for the quarter as compared to a gross profit of approximately $287,000 for the first quarter of the prior year. The decrease in gross margin was largely due to a reduction of revenue in the current quarter by approximately $231,000 due to a change in estimated revenue to be recognized in connection with the Spain construction agreement. Our future gross margins will be dependent on the nature of future contracts, our success at increasing sales of our PowerBuoy systems, and our ability to manage costs incurred on fixed-price commercial contracts. Product development costs increased to $4 million as compared to $1.4 million for the first quarter of the prior year. This planned cost increases were primarily due to our efforts to increase the power output and reliability of our utility PowerBuoy systems, especially the 150-kilowatt…

Thank you, Brian. Turning to slide number 13, The Board and management of OPT are committed to the company becoming profitable as soon as possible. We believe we have paths to profitability with each of the two major market areas we mentioned earlier. The first path is with our utility PowerBuoy market, which targets a market size of approximately $50 billion per annum and is all about large amounts of power provided to the grid. This utility market opportunity is driving our product development investments to increase the power output rating for PowerBuoy to 150 kilowatts and further to 500 kilowatts. As we've stated earlier, we're pleased with the progress that we continued to make with this product. We also had made very strong progress with our Autonomous PowerBuoy. The ability of the PowerBuoy to operate autonomously in remote ocean locations is truly an enabling technology. In addition to homeland security, we believe there is strong potential for our systems to be used for offshore oil and gas platforms, aquaculture or fish farming, and ocean-based communication, and data gathering such as port tsunami warnings. We estimate this market size to be approximately $10 billion per annum worldwide. It's important to note that the fundamental PowerBuoy technology is the same for both these markets. The difference in the PowerBuoy's addressing the two market areas primarily likely lies in the size and rated power output of the systems. In the slide, we have also shown how our present projects as well as our ongoing marketing initiatives support progress along both paths to profitability. We believe that either of these paths alone can move us to profitability and positive cash generation from operations. Turning to slide number 14, we're truly excited about our long-term prospects. And we also believe OPT remains on track…

Thank you, everyone. That concludes today's webcast. You may now disconnect, and have a great day.