Ladies and gentlemen, thank you for standing by. Welcome to Elbit Systems Second Quarter 2015 Results Conference Call. All participants are at present in listen-only-mode. Following management's formal presentation, instructions will be given for the question-and-answer session. As a reminder, this conference is being recorded. You should have all received by now the company's press release. If you have not received it, please contact Elbit's Investor Relations team at GK Investor Relations or view it the News section of the company's website, www.elbitsystems.com. I would now like to hand over the call to Mr. Ehud Helft of GK Investor Relations. Ehud, please go ahead.

Thank you and good day to everybody. On behalf of all the investors, I would like to thank Elbit Systems management for hosting this call. Joining us today on the call are Mr. Butzi Machlis, Elbit's President and CEO and Mr. Yossi Gaspar, Elbit's, Chief Financial Officer. Yossi will begin by providing a discussion of the financial results for the second quarter of 2015, followed by Butzi, who will talk about some of the significant events during the quarter and beyond. We will then open the call for the question-and-answer session. Before we begin, I'd like to point out that the Safe Harbor statement in the company's press release issued earlier today also refers to the content of this conference call. And with that, I would like to turn over the call now to Yossi. Yossi, please.

Thank you, Ehud. Hello, everyone, and thank you for joining us today. Overall, as we do every quarter, we will provide you with both our revenue and GAAP financial data as well as certain supplemental non-GAAP information. You can find all the GAAP financial data as well as the non-GAAP information in today's press release. Overall, we're pleased with our performance in the second quarter of 2015. Marking continued growth in revenues backlog and improvements in profitability. I will now highlight and discuss some of the key figures and trends. Our second quarter 2015 revenues were $749.6 million, an increase of 6.7% compared with $702.6 million reported in the second quarter of 2014. In terms of revenue breakdown, across our areas of operation in the quarter. Airborne systems was 42%, C4ISR was 29%, armoured vehicles was 18%, Electro-optics was 7% and the rest was 4%. In terms of geographic breakdown for the second quarter, Israel was 20% of our revenues, North America 27%, Europe 13%, Asia-Pacific 29%, Latin America 10% and the rest of the world was 1%. Compared with the second quarter of last year, from the overall mix we saw a major increase in armoured vehicles. This was primarily due to higher levels of sales of this systems to Asia-Pacific region. I should add that, the Land systems growth included Electro-optic subsystems which resulted in lower direct sales to end customers of the Electro-optic systems. For the second quarter, our gross margin was 29.2% compared to 28.4% as reported in the second quarter of last year. The non-GAAP gross margin was 30% in the second quarter of this year compared with 29.1% second quarter of 2014. Operating income in the second quarter was $65.5 million with an operating margin of 8.7% compared with an operating income of $62.6…

Thank you, Yossi. We are pleased with our second quarter results demonstrating our beliefs, [indiscernible] remains - in particular, we reported a strong level of year-over-year revenue growth of approximately 7%. This growth was due to our growing backlog over the past two years. In particular, I'm pleased with effect that despite of increase in revenue to a level of almost $750 million in the quarter, we were still able to increase our backlog. In addition, I would like to note. The solid performance demonstrated by the geographic regions is strong emerging defense requirements, that only few years ago, we started to positive growth in fact, the emerging defense market of Asia Pacific and Latin America, together performed very well over the past few quarters. This quarter in particular despite from [indiscernible] in Latin America, they still accounted together for almost 40% of our revenue, a record level for this region. With, [indiscernible] in Elbit Systems ability to continuously adapt to upcoming market trends in order to meet future customers need. We have completed acquisition in cyber area is another example of this. After the close of the second quarter, we completed the acquisition of the Cyber & Intelligence division of Nice Systems. The Cyber & Intelligence division offers solution, which provides law enforcement agencies and intelligence organization with tool for creating communication intelligence. Our wholly owned subsidiary Cyber group which will only recently establish to focus our cyber services is a process of integration of this operation into one organization. The acquisition is an important milestone in our strategy to enhance our cyber capabilities. A sector in which we see significant growth potential over the coming years. The acquisition will enable us to provide our customers with end-to-end market reasoning cyber solutions. A significant technological and multi-synergies, which we…

[Operator Instructions] the first question is from Gilad Alper of Excellence. Please go ahead.

Thank you. My question is on the competition you're seeing in the Far East and Latin America especially in the Far East, you've been active in those markets for quite a while and obviously, you've done very well there. So the question is, have you seen any development in terms of competition over the last two years or three years competition, maybe getting stronger and weaker staying the same. Thanks.

We are looking for competition for many years and we see a lot of interest in our product and the fact that, many customers are choosing [indiscernible] of the level of innovation. We have in our technology and [indiscernible] that we have a very large portfolio and very innovative portfolio and most of the system that we are exporting our [indiscernible] operation as usual, that's the big advantage. So we see competition, we're used to our competition that I'm very proud, but we want to maintain sales in Asia Pacific as well as in other parts of the world [ph].

Okay, thanks.

[Operator Instructions] the next question is from Ella Fried of Bank Leumi. Please go ahead.

Good afternoon. My question is about the rate of growth on the backlog. We know that there were some delays in the idea of orders because of the budget. On the other hand, we expect to some growth in the US military aid to Israel resulting from the Iran due. So what do we expect, how do you see the backlog developing in the future in the next quarters?

Well as you know, our backlog usually is billed through many contracts that we're winning. Usually in the medium sized, tens of millions of dollar each and from time-to-time, as our press releases show from contract hundreds of millions of dollars coming in. It very much can vary from quarter-to-quarter because of the income of several hundreds of millions of dollars can of course significantly increase that. What we have seen so far, is that we are pursuing quite a significant number of business opportunities and if we assume, that the rate of win will not change and that's what we think will happen, we are optimistic for the future.

But are there any concrete triggers like the ones I mentioned or its more continuous process?

It's a continuous process.

Okay, thank you.

The next question is from Bruce Schoenfeld of the BlueStar Global Investment. Please go ahead.

Yes, hi. Good afternoon, can you confirm that the business, the cyber business that you bought from Nice is unprofitable at this point, that number one. Number two, assuming that's the case what impact it will have on margins going forward. And if you can provide some idea as to when the combined cyber businesses will be profitable. Thank you.

I think, what's released during the acquisition. I think that the performance of this business under management of Nice, was profitable and that is was Nice's press release. We see no reason that, this business should not be flexible under our management, the opposite is right. We are looking forward with optimism for the improved performance of this business. Mainly because there is quite a lot of synergy between this business and the rest of the company. Having said that, we'll have to, we will clarify in the first quarter and on the performance of our GAAP and non-GAAP bottom line and that is because, there is some accounting related with the overall numbers that we're going to show for the performance of the company. Otherwise, we're just very optimistic about this business growing and being profitable.

Thank you.

The next question is from [indiscernible] Portfolio Management. Please go ahead.

I see you announced the closing of the Cyber acquisition of July 1. Just to be clear, does the balance sheet on June 30 included or not include the transaction and I didn't understand your very last comment with regard to the third quarter accounting. I didn't understand the nuance there.

First of all, it does not include. Second quarter does not include anything about this acquisition. Regarding the clarification, I would say the basic business on a non-GAAP basis is profitable. I would say very nicely profitable. The accounting of how this business is incorporated into our numbers will be more detailed with our third quarter, press release.

I understand, in that case. Another question, why did the intangible assets go up in the second quarter relative to the first quarter?

Well, there was a small acquisition that we did during the second quarter, was not material to us and therefore, we saw small increase in the intangible.

Thank you.

There are no further questions at this time. Before I ask Mr. Machlis to go ahead with his closing statement. I would like to remind participants that a replay of this call will be available two hours after the conference end. In the US please call, call 1 (888) 782-4291. In Israel, please call 03-925-5900. And internationally, please call 972-3925-5925. A replay of the call will also be available at the company's website, www.elbitsystems.com. Mr. Machlis, would you like to make your concluding statement?

I would like to thank all our employees for their continued hard work. To everyone on the call, thank you for joining us today and for your continued support and interest in our company. Have a good day and goodbye.

Thank you. This concludes the Elbit Systems Ltd second quarter 2015 results conference call. Thank you for your participation. You may go ahead and disconnect.