Good day, ladies and gentlemen, and welcome to the third quarter 2008 Amstrong World Industries, Inc. earnings conference call. My name is Shewana [ph] and I will be your coordinator for today. At this time, all participants are in a listen-only mode. We will facilitate a question-and-answer session towards the end of this conference. (Operator instructions) I would now like to turn over the call to your host for today, Ms. Beth Riley, Director of Investor Relations, please proceed Ma'am.

Thank you, Shewana. Good morning, and welcome. Please note that members of the media have been invited to listen to this call, and the call is being broadcast live on our website at armstrong.com. With me this morning are Mike Lockhart, our Chairman and CEO, and Nick Grasberger, our Senior VP and CFO. Hopefully, you've seen our press release and 10-Q this morning, and both the release and the presentation Nick will reference during this call are posted on our website in the Investor Relations section. In keeping with SEC requirements, I advise that during this call we will be making forward-looking statements that involve risks and uncertainties. Actual outcomes may differ materially from those expected or implied. For a more detailed discussion of the risks and uncertainties that may affect Armstrong, please review our SEC filings, including the 10-Q filed this morning. In addition, our discussion of operating performance will include non-GAAP financial measures within the meaning of SEC Regulation G. A reconciliation of these measures with the most directly comparable GAAP measures is included in the press release and in the appendix of the presentation. Both are available on our website. When that, I would like to turn the call over to Mike.

Thanks, Beth. Good morning everybody and thanks for participating in today's earnings call. I'm sure everyone's weary of hearing about the global economic and credit market challenges. The US residential markets continued their decent, the consumer has stopped spending, US commercial markets are declining, Western European market growth has slowed, and some European markets are declining. Asia has been growing but at this point all of our markets are in turmoil. In this increasingly chaotic environment, we are pleased that, excluding the benefit of foreign exchange, sales declined only 1% and adjusted third-quarter operating income actually grew 5% to $93 million. The consistent themes across our business are improved manufacturing productivity and reduced SG&A spending and we need these improvements to offset inflation and weak volume. The largest volume declines were in businesses serving the US housing market – Resilient and Wood Flooring and Cabinets. In the aggregate, higher price in the quarter offset two thirds of raw material and energy inflation. Building products, our ceilings business, continues to perform well despite the weak US commercial markets, a slowdown in most Western European markets, and increase costs inflation. Prices rose and product mix improved. SG&A cost were slightly lower and WAVEs earnings increased. North American Resilient sales were down about 3% in the quarter. Mid-single digit volume declines offset modestly better price realization and improved mix. While the volume declines were more severe for residential products, commercial volume fell too. Operating income declined more than 40%. The adverse effects of lower volume and raw material cost inflation exceeded the benefits of better price realization, lower manufacturing, and SG&A cost. Ignoring currency effects, European Resilience sales were up less than 1%. With improved product mix and modest price increases offsetting slight volume declines. Reduced manufacturing and SG&A cost combined with the…

Okay. Thank you, Mike, and as Beth noted in her opening comments, my remarks will refer to a series of charts that are posted on the website. The first chart is numbered 3, and it is the key financial metrics for the September quarter adjusted from non-recurring items and foreign exchange. Beginning with sales. Sales for the quarter were $914 million, down about 7/10 of 1%. This compares to the reported figure of up 2% which includes the benefit of currency. So breaking down the net sales variants, price increased 2.5 points, volume was down about 4 points, and NIX improved by about 100 points – sorry, 1 point. Operating income for the quarter, $93 million, was up about 4% versus last year's third quarter. The operating margin of 10.1 %, is actually the highest operating margin that we've seen in the third quarter, since the year 2000. The operating income performance was a little better than we thought. It would be mostly because of in building products, slightly higher volumes, and better performance from WAVE. Earnings per share of $0.85 was down about $0.03. Interest expense was down. The effective tax rate was up about 7.5 points due mostly to the recognition of interest expense on the carry back NOL election we made last year, and also some state tax rate changes in the past quarter. A cash flow of $90 million was down about $24 million versus the same period last year mostly due to higher cash taxes and lower cash earnings on a reported basis. Our net debt, this is gross debt net of US cash, was about $350 million at the end of the quarter. Debt was $500, cash in the US was about $150. Just a few comments on our liquidity situation. The debt that…

(Operator instructions) Your first question comes from the line of Keith Hughes with SunTrust. Please proceed. Keith Hughes – SunTrust: Thank you. Just have some question – one question on the fourth quarter. The operating income decline that you're discussing in the chart on that is a lot more severe than revenue decline. Are we going to be pulling back in production, preparing for weak business next year, or is there something unusual seasonal going on in the fourth quarter?

No, there is certainly no plans to pull back on production necessarily. Of course, we're looking at that in a continuous basis. But, no, I think part of this reflects, as we mentioned, the way business coming off a little bit in the fourth quarter from a margin standpoint relative to where they've been. So we'll see lower earnings from WAVE and, of course, there's no– we don't consolidate their sales. So there's a bit higher leverage than you might expect on the downside because of WAVE.

And the weakness in residential in the North American Flooring business is going to be in commercial and that has a much higher margin than the residential products do. Keith Hughes – SunTrust: Okay. Thank you.

Your next question comes from the line of John Baugh with Stifel. Please proceed. John Baugh – Stifel: Okay. John Baugh. Good morning. I'm curious whether you can give us some kind of feel. We're all trying to feel or think about how bad “bad” is going to be next year, and maybe two areas – you think you can remain profitable or break even, let's say, in Flooring, globally, next year under “any scenario” within reason? And what is the sensitivity to WAVE if we were to assume that revenues fell 10% to 30% or something. What kind of variable fixed expense and what’s the net margin there that's been running around 30% year-to-date. What happens under such a scenario? Thank you.

Well, first, I'd say that it is hard to imagine a scenario in 2009 where the Flooring business on a global basis would lose money. We would expect the European business pre-restructuring to continue to make losses, but certainly the North American Flooring business and the Asian Flooring business are solvently [ph] profitable and we would expect that to continue, although at lower levels. Certainly North America. In the WAVE business, John, honestly I've not looked forward to 2009 and kind of modeled out what the downside scenario could be for WAVE. Certainly the margins have remained at all time highs and we would to expect those to come off as steel prices come off. There's probably not a lot of fixed expense that will come out of the business, but as you know, it's not a very capital intensive business. There's not a lot of fixed cost in that business to begin with. So, the fall through from sales to earnings is pretty high. John Baugh – Stifel: Okay. And then, CapEx. Was it $55 million year to date and your budgeting a $100 for '08, is that correct?

Yes. We still expect that we'll spend $100 for the full year. John Baugh – Stifel: Okay. Any thoughts out into '09?

The basic spending would be about $100 plus anything we did on – in a major – the only thing we have that is major is, we announced this morning – I assume we announced this morning – that we were going to do a convert our Lancaster Floor plant to produce probably the last back [ph] products. So, on top of that, we'll have a $20 million – $25 million dollar spend on that. So, it would be, maybe a $100 plus or minus some plus the $25 for Lancaster. John Baugh – Stifel: Okay. And Nick, is there any thought about repatriating a $150 million odd foreign cash at this point?

Yes, we are looking at that John. We certainly have had some plans to use that cash to fund some offshore investment opportunities that we may well be delaying in this environment. So we need to think about repatriating that cash in the context of still making those investments at some point. John Baugh – Stifel: Thanks. I'll prefer [ph] the others.

(Operator instructions) Your next question comes from the line of Jim Barrett with C.L. King and Associates. Please proceed. Jim Barrett – C.L. King and Associates: Good morning, everyone.

Good morning. Jim Barrett – C.L. King and Associates: Mike, is share repurchase out of the– not on the table at this point, I understand its a board decision, but what are your thoughts on share repurchase at these levels?

You know, we still have– there's still a tax benefit to doing – its really dividend, and so I think a return of capital to shareholders would be highly likely to be a dividend, even at this share levels. We honestly think the shares are terribly undervalued, but even given that, I think that tax advantages would suggest that we'd rather do– that we'd rather return capitals as a dividend. Jim Barrett – C.L. King and Associates: I see. And at your analyst day, you laid out financial targets for fiscal 2011. Is it reasonable to assume those targets are in suspension for the time being? How should we look at those?

I think, that's– obviously that's where we'd like to be, but we sure as heck don't know what the world's going to look like between now and then, and I'm told that lots of CEOs are ducking this question about what 209 is – what 2009 is going to look like. Now, you guys, I don't think any of us have a clue what 2009 is going to look like and on order we understand – know what 2011 is. If we get – if we have the market that we were looking for, which was not particularly strong, we should be able to make those improvements. We do – the beauty of where we are today is that we're profitable, we have good cash flow, and we can make the investments we need to make to improve the business. We're going to continue to do that. Jim Barrett – C.L. King and Associates: Okay. And then finally, Nick, can you at least give us some thoughts directionally on how we should view the pension credit income for next year.

That's actually a very involved calculation. The impact on pension income will be much less that what you might think given the way that calculation is made. So, if we assume that we ended the year on September 30 and reset that, the figure for 2008 would be $60 million to $63 million. The figure for 2009 would be kind of in the $45 million to $55 million range. It wouldn't be as significant as what might be implied by the decline in our surplus. Jim Barrett – C.L. King and Associates: I see. You said $45 to $50?

$45 to $55 Jim Barrett – C.L. King and Associates: Thank you both.

You have a follow-up question from the line of John Baugh with Stifel. Please proceed. John Baugh – Stifel: What it was the European Flooring EBIT loss? You mentioned it improved 40%. Where did that come in?

It was $2 million. John Baugh – Stifel: And do we still hope with whatever you're going to tell us 90 days from now that we can get close to break even under some normal reasonable volume assumption. Is that still the game plan?

Yes. John Baugh – Stifel: Okay. On the raw materials, are you seeing anything turn right now or you just looking at what net gas and oil are doing? How do you think about raw materials versus pricing going in to '09?

Clearly, with the decline in natural gas, it will benefit us, we won't see the full benefit until late 2009 and of course in 2010 because of our hedging policy which hedges 80% of forecast needs 15 months in advance. So, we won't see a lot of benefit from that in 2009. And the biggest thing we buy is lumber, and we are seeing some slightly lower lumber prices that we think will continue to benefit us in 2009. And then the next biggest thing is PVC and we will see some modest benefit from PVC in the fourth quarter and we should see a significant benefit from PVC in plasticizers in 2009. Now, on the residential side, we never got price increases to cover it, so we would hope we wouldn't have to lower prices as we see some declining raw material cost. We might see some small price offset in the commercial business. John Baugh – Stifel: Great. And then lastly, are you projecting to lose EBIT in Flooring in Q4? And if so, or close to break even, is that due to the sudden decline we've seen here in the last 60 days and inability to adjust SG&A spend and other things accordingly. Some kind of feel for that for Q4.

Yes. We certainly expect, when you say to lose the EBIT, yes we expect it to decline year-over-year, in a fairly significant way. John Baugh – Stifel: Not decline. Being negative.

In the US, no. On the global basis, yes. The global Resilient business would like lose money in the fourth quarter. John Baugh – Stifel: Okay. Great. Thanks for that color, Mike. Nick.

At this time, there are no further questions. I would now like to turn the call over to Ms. Beth Riley for closing remarks.

Thanks. I just want to thank you all again for joining us this morning. As always, I will be available the rest of the day and the following days for any follow-up questions. Have a good day.

Thank you for your participation in today's conference. This concludes the presentation. You may now disconnect and have a good day.