Good morning, ladies and gentlemen, and welcome to the Piper Jaffray Companies conference call to discuss the financial results for the second quarter of 2013. [Operator Instructions] The company has asked that I remind you, statements on this call that are not historical or current facts, including statements about beliefs and expectations, are forward-looking statements that involve inherent risks and uncertainties. Factors that could cause actual results to differ materially from those anticipated are identified in the company's earnings release and reports on file with the SEC, which are available on the company's website at www.piperjaffray.com and on the SEC website at www.sec.gov. As a reminder, this call is being recorded. And now I'd like to turn the call over to Mr. Andrew Duff. Mr. Duff, you may begin your call.

Good morning, and thank you for joining us to review our second quarter results. I will spend a few minutes discussing the market environment and performance of our business and then hand the call over to Deb to review our financial results. Overall, we experienced a mixed environment in this -- in the markets this quarter. On the favorable side, equity markets built on their strong first quarter performance. The S&P index was up 3% for the quarter and 13% for the first half of the year. Our equity-related and asset management businesses benefited from these accommodative market conditions. Stronger equity markets do not appear to have much impact on the M&A activities during the quarter. In public finance, interest rates remain attractive to new issuers and we continue to see healthy investor appetite for new municipal debt offerings. The fixed income trading markets, however, experienced turbulent conditions, which adversely impacted our institutional brokerage results for the quarter. Late in the quarter, the Federal Reserve signaled its intentions to curtail its quantitative easing program later this year. The reaction across fixed income markets was both immediate and substantial. The 10-year Treasury, for example, traded around 1.6 in early May. Post the announcement, it traded at 2.6, representing a rate increase of over 60%. The volatile conditions across fixed income markets were even more pronounced in the municipal bond market. With market making and municipal bonds a core part of our franchise, overall results were negatively impacted by the abruptness and magnitude of the change in municipal bond pricing. We have a long history in this business, and the movements in rates towards the end of the quarter was the most dramatic we have experienced in over 25 years. This proportionate impact on municipal bonds was a result of both an…

Thanks, Andrew. In the second quarter of 2013, continuing operations generated net revenues of $100 million. Net income from continuing operations was $4.4 million or $0.25 per diluted common share. And our pretax operating margin was 3.3%. For the second quarter of 2013, compensation and benefits expenses were 65.1% of net revenues compared to 60.7% and 60.4% for the second quarter of 2012 and first quarter of 2013, respectively. The higher compensation ratio was due to a change in revenue mix driven primarily by trading losses and fixed income and fixed compensation expenses on reduced revenues. Non-compensation expenses were $31.4 million for the second quarter of 2013 compared to $34.8 million for the year-ago period, which included restructuring charges. Non-compensation expenses increased from $25.3 million in the sequential quarter, which was reduced by the receipt of insurance proceeds for the reimbursement of prior legal settlements. Our effective tax rate from continuing operations, excluding the impact of noncontrolling interest, was 27.4% for the second quarter of 2013. Our reduced tax rate for the quarter was due to the impact of tax-exempt interest income representing a larger proportion of our pretax income than prior periods. Now I'll turn to the segment results. For the second quarter, capital markets generated net revenues of $81.8 million, a pretax operating loss of $2.1 million and a pretax operating margin of negative 2.6%. Excluding the impact of noncontrolling interest, the capital markets segment was modestly profitable for the second quarter. Net revenues decreased 7% compared to the second quarter of 2012 due to declines in M&A revenue from fewer completed transactions and lower revenue from fixed income institutional brokerage. The reduced revenues from fixed income institutional brokerage were partially offset by improvements in equity financing and equity institutional brokerage revenues. As Andrew discussed, our fixed income…

Operator, we are ready for Q&A.

[Operator Instructions] First question comes from the line of Joel Jeffrey with KBW. Joel Jeffrey - Keefe, Bruyette, & Woods, Inc., Research Division: A question on the fixed income trading side of the business. If muni prices kind of stabilize here or don't move one way or the other meaningfully for the remainder of the quarter, just from trading volume alone, do you guys think you can get back to that sort of $25 million per quarter in revenue you'd talked about in the past as a run rate?

Yes, we do. There might be a slight change in mix between flow and trading, but we do anticipate that we'll do that. Joel Jeffrey - Keefe, Bruyette, & Woods, Inc., Research Division: Okay. Can you give us a sense on typically how much of your businesses is flow driven and how much of it is driven by sort of marks on the portfolio?

So Joel, I would talk about that in 2 -- maybe in customer flow versus strategic trading, because there are marks on the portfolio that can happen in both of those businesses. So if you think about our customer flow business, which has been and will continue to be the majority of the revenues, we do hold also the majority of our inventory in that side of that business. And we did experience trading losses, again as we've talked about, both realized and unrealized on that side of the business, again given everything we've talked about with the increase in rates and increase in spreads. And then on the strategic trading side, we did also experience some challenging trading conditions. But on that side, our net revenues were positive, just significantly lower than they had been in prior quarters. Joel Jeffrey - Keefe, Bruyette, & Woods, Inc., Research Division: Okay, great. And thinking about the advisory business, I mean, are you guys seeing now, are we sort of through this hangover we've had in middle-market M&As that came from the pull-forward in the fourth quarter?

We feel like we are, and if I can just speak to our backlog and the activity we've got going on. Exactly, it was sort of a Q1, Q2 event, with the very substantial Q4. And we expect, starting in Q3, to have a strong rebound. Joel Jeffrey - Keefe, Bruyette, & Woods, Inc., Research Division: Are there any areas in specific that you're seeing the most strength?

It's really across our 4 industries. And very excited, again, to have a addition of the Edgeview team too, now. Joel Jeffrey - Keefe, Bruyette, & Woods, Inc., Research Division: Okay. And then I guess, just lastly for me, can you give us a sense, how much cash do you currently have on the balance sheet?

You can actually look at our fourth quarter. It's just so you understand how we manage the business from a cash perspective because we're a net borrower every day to finance our inventories. So the cash we hold is typically for reserves required for customer deposits or other capital requirements and various legal entities. So I may have where we are at the end of the quarter here, if you just give me 1 moment. Joel Jeffrey - Keefe, Bruyette, & Woods, Inc., Research Division: Sure.

We were, at the end of June, about $69 million, and that excludes $27 million which was held aside and segregated for regulatory purposes.

Next question comes from the line of Michael Wong with Morningstar.

Okay, so after turning some underperforming businesses and acquiring some higher-margin ones recently, do you have any updated overall guidance for the company's compensation ratio or normalized operating margins?

So from a compensation ratio in particular, this quarter was higher, as I had spoke to, given the trading losses. We had previously guided a 60% to 61% target. Actually, with the acquisition of Edgeview, there are some retention-related compensation items for that target we see, going forward, as being 61% to 62%. Of course, this -- that really depends on revenue mix, as I have talked about in the past, as well as just overall level of revenues. As overall revenue levels move higher, we could see that ratio coming down over time. But in the current environment, we're targeting a 61% to 62%.

Okay. And I was just hoping you could talk a bit more about your merchant banking business. Would you say you're still just probing the waters in that? Or have you made a fairly firm strategic commitment to building that out?

I would say it's the latter. So we built a portfolio internally in the firm over a 3- to 4-year period, created a track record. And then I think, as you know, we went externally about a year ago and raised $50 million to a -- into a fund and contributed to that $50 million in firm capital and feel that -- very positively about our original deployment of that. So it's a strategic initiative that -- based on what we believe will be a strong track record. We'd -- intend to grow those assets primarily externally.

[Operator Instructions] Your next question comes from the line of Brian Hagler with Kennedy Capital.

Joel touched on a couple of my questions, but if we could maybe get into a little bit more detail. It sounds like, on the fixed income institutional side, if we just look at kind of quarter-to-date results, we are tracking on a more normalized $25 million type revenue number. Is that correct?

On a go-forward basis, that is correct.

Yes, we would expect that. No change.

Okay. And then can you give maybe a little more detail? You're -- it sounds like you're obviously more optimistic on the advisory side. Can you just give some maybe pipeline information there or some numbers that kind of act your optimism or what you look at?

Well, we look at pipeline, Brian, but we don't disclose it. I mean, some of it's public information, a lot of it's not. And then we would just point you to what we've been saying since Q4's very strong year end that we thought was a pull-forward, that we saw a very strong back half of the year and relatively low activity in the first half, and we're very much on track for that, and looked at the business that we've had over the years.

And there are no further questions at this time.

All right, well, let me just conclude by again saying we recognize the impact in the quarter of the dislocation in the -- particularly the munis, to our second quarter results, but we believe our business is performing well. Very active in the capital raising on both sides of the house, strong M&A pipeline; and are very pleased that our 2 strategic acquisitions now closed. Thank you, all, for joining us this morning.

And last ladies and gentlemen, with this, we conclude today's presentation. We thank you for joining. You may now disconnect.