Good morning and welcome to the Acuity Brands 2008 second quarter financial conference call. After today’s presentation there will be a formal question-and-answer session. To ask your question press *1 on your touchtone phone. If you have any objections you may disconnect at this time. I will now turn the call over to your conference host, Mr. Dan Smith, Vice President, Treasure and Secretary of Acuity Brands. Sir you may begin.

Good morning. With me today to discuss our second quarter results are Vern Nagel, our President, Chairman and Chief Executive Officer and Richard Reece, Executive Vice President and Chief Financial Officer. We are web casting today’s conference call at www.acuitybrands.com. I would like to remind everyone that during this call we may make projections or forward-looking statements regarding future events or the future financial performance of the company. Such statements involve risks and uncertainties such that actual results may differ materially. Please refer to our most recent 10Q and today’s press release which identify important factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. Now let me turn the call over to Vern Nagel.

Thank you, Dan. Good morning everyone. I would like to make a few comments and then Ricky and I will be happy to answer your questions. On behalf of our 7,000 associates world wide I am again pleased to announce record quarterly results for net sales, net income and diluted earnings per share for the second quarter of 2008. This is our twelfth quarter in a row of record results. I know many of you have already seen our results but I would like to make a few comments on the key highlights for the quarter. Our diluted earnings per share for continuing operations were $0.82, up 64% from the year ago period. Net sales for the quarter were $483 million, up almost 9% compared with the year ago period. Solid growth in net sales and continuing robust increase in earnings reflect the benefits from the execution of our strategy to be the innovative leader in new energy efficient lighting fixture products, expansion of our presence in key channels and markets, continued improvements in our service, increasing productivity gains and our disciplined approach to pricing. The growth in our net sales in the quarter was even more notable given the continued decline in construction activity in the residential housing market. While it is impossible for us to know the precise impact that the declining demand in the residential housing market had on our net sales, we believe this weakness reduced our total net sales by roughly 1% this quarter compared with the year ago period. The acquisition of Mark Architectural Lighting and the favorable impact of foreign currency exchange rate changes contributed about 2 percentage points of the increase in net sales in the quarter. Excluding the impact of these items and the decline in the residential housing market, we…

Thank you, Vern. Good morning everyone. Vern previously discussed key highlights of our operating results for the quarter so I will not repeat this information. However, I would like to provide more detail on our reported results. In addition, I will briefly comment on the first half results and cash flow. Net sales for the quarter were $482.6 million, up 8.6% from prior year. The impact of foreign currency exchange rate changes contributed approximately 1 percentage point to this improvement. The contribution of Mark Architectural Lighting added around another one percentage point. We continue to be very pleased with the contribution this business, which was acquired in July 2007, is making especially in the New York City market. We were in the process of adding additional New York City product compliant to its portfolio and believe we can further penetrate this significant market. Vern previously said we estimate that our net sales grew about 7% in our primary market, the non-residential sector, and that the product mix, price and volume growth each contributed relatively equally to this improvement. Looking first at the enhanced product mix our efforts to be an innovative leader especially in energy efficient products such as RT5, ES8, I-Beam, Super Glass and others is resulting in a higher price per unit as compared to the more standard products they can replace. Secondly, looking at price we continue to be very disciplined in our approach to pricing. While most of the increases are necessary to off set higher costs, we are seeing opportunities as we improve service and highlight features and benefits in our products that lower the total cost of ownership for the end user and allow us to get paid for the differentiation. Lastly, our volume growth generally reflects the overall markets that we serve. However,…

Thank you, Ricky. As we look at the balance of 2008 and beyond we continue to see challenges, but more importantly opportunities. Let’s note a few of these challenges. It is well known the economy in the United States is experiencing a slow down due to the disruption in the housing and credit markets. Clearly it is impossible to know if or predict when the timing or impact these disruptions could have on the growth rate of the non-residential construction market. Several factors which influence the future growth rate of the non-residential housing market including the future vitality of the economy, job creation, occupancy rates and the availability of capital are all in a current state of flux. Although these concerns are worrisome, the Federal Reserve and U.S. Treasury implemented a number of actions designed to boost investor and public confidence about the overall direction of the U.S. economy including lowering interest rates and increasing liquidity in the financial markets. We believe these actions will have positive influence on the longer term trends for construction in North America. Overall we remain positive about our performance for the remainder of 2008 where we expect to meet or exceed our long term financial goals including margin expansion, earnings growth and cash generation. While our back log at the end of February was down about 2% compared with the year ago period, the decline was due primarily to improved cycle times, the timing of certain orders, and reduction in past due back log. More importantly, our daily incoming order rates in March were positive with those reported in the year ago period as key sectors and geographies in the non-residential market where we have particular strength enjoy positive growth off setting the fall off in the residential market. We expect other factors to…

We will now begin the formal question-and-answer session. In order to ask your question please press *1 on your touchtone phone. You will be announced prior to asking your question. To withdraw your question you may press *2. Once again, to ask your question press *1 on your touchtone phone. Our first question comes from Peter Lisnic of Robert W. Baird & Co. Peter Lisnic - Robert W. Baird & Co.: Good morning gentlemen. Vern, I guess the first question I had is if you can expand a little bit on really what you are doing on the productivity side because I think margins here continue to surprise on the upside and I’m getting a sense that part of that is driven by productivity. So can you just peel back the onion a little bit more on the productivity side of the equation and why it is driving margins?

Sure. We have been on, if you will, our lean journey for more than three years now and I believe as we become a leaner, more customer centric company that is committed to driving both continuous improvement as well as improving operational excellence in everything we do the organization is rallying to these calls. As a consequence we are very aggressive as a company about reducing or eliminating lesser value added activities and focusing on higher value added activities. Our facilities, whether it be manufacturing facilities, distribution facilities or even at the office we are seeing productivity at all levels. This is something we believe is contributing significantly not only to our bottom line vis-a-vie cost savings but it is affording us the opportunity to better serve our customers which allows us to gain share, if you will, as well as create a better experience allowing us to differentiate that value and lastly it is allowing us to invest more aggressively in our new product development which is allowing us to have enhanced product mix if you will of sales. So all of this is a conservative program to drive greater value for our customers, allowing our associates to continue to grow and the benefit we are really seeing enlarging improvement in cash flow generation and upper quartile performance for our shareholders. Peter Lisnic - Robert W. Baird & Co.: Okay and if you look at your productivity metrics I guess how would you rank yourselves in terms of being world class? What I’m trying to get a sense of is how much more opportunity is there? You’ve been successfully doing this for quite a few quarters in a row now and I’m just wondering if you use the baseball analogy what inning are we in? How much more opportunity is there?

Our team would say we are probably in the second inning. We haven’t come to bat yet. Peter Lisnic - Robert W. Baird & Co.: You must have skipped your bat in the first inning. I’ll ignore that I guess.

We haven’t come to bat yet in the second inning. We are very early in our journey. We see a great deal of opportunity to continue to as an organization to drive greater value for our customers, to continue to deploy those assets and investments in areas that have higher growth rates and higher opportunities for the customer base and there are many folks that are going down the same path and the tools are all known. As Toyota is fond of saying we will let anybody walk through our facilities because it is not what you see it is how our people go about their daily activities. I’m just very proud and very pleased at our organization and the passion with which we have to improve value, quality, delivery, cost, and product innovation, all of these key areas that are very important to us in terms of creating value for those key stakeholders. Peter Lisnic - Robert W. Baird & Co.: Okay fair enough. Then if you don’t mind just help me on the retrofit market. I know this question is often asked but can you give us a sense of size or scale that business, or at least what kind of traction you are seeing in kind of penetrating the retrofit market?

We recently announced an organizational change in our company in creating a new business unit called Acuity Brands Technology Services and part of that effort is really to develop a more concerted value proposition targeted at more broadly what we will call the relight retrofit market to coalesce our resources and our capabilities to provide value to our customers whether they are through all our various channels. We right now at this point in time estimate the market as I said earlier to be north of $100 billion but it is a market place that is being served in a very small way today. So we are about creating or defining if you will our strategies for that. But today we are taking advantage of our very broad energy efficient product line. As Ricky mentioned earlier whether it is an RT5, ES8 or an I-Beam or capabilities around Super Glass…all these things afford our customers the opportunity to enjoy substantial energy savings while realizing improved lighting aesthetics and capability. These products have a great deal of technology in them. They are proprietary in many respects. For us we are about getting after that market but serving customers today in the more traditional way. We think there are other ways to expand our access to market to give our agents even more capability to go after this market to enhance our national account capability. So a lot more to come on our strategies as we hone and fine tune those. But we’re not ready for a full, if you will, release of that strategy at this point in time. Peter Lisnic - Robert W. Baird & Co.: Okay. Fair enough. Thank you for your time and congratulations on a great quarter.

The next question comes from the line of Matt McCall with BB&T Capital Markets. Matt McCall - BB&T Capital Markets: Thank you. Good morning every body. One of the comments you made was I think you talked about this in the past that you were seeding some more market shares and some more price sensitive commodity segments of the market place. Can you give us an idea of what the impact has been there, both I guess really since over the past 4-5 years on the top line and even more so recently what the impact has been on the top line, but also what the impact has been on your margins as you look to those higher margin businesses or segments I should say in products?

I’d like to make a comment on your first comment about us seeding, if you will. We, as I said a couple of quarters ago, really view all portions of the market to be opportunities for us as the clear market leader the notion of seeding some portion of the market is not very appealing to us. As a consequence of that we have introduced products that have features and benefits at various price points in the market to go after that share. So at the lower end of the market from a price point perspective we have introduced Contractor Select to target those markets and price points that have features and benefits that are consistent with that and we are seeing traction in that area. Whenever you introduce a new product line it takes awhile to develop that. We are pleased with our progress to date. More to come on that. But you are absolutely right in your observation that we have maintained our price discipline at all segments of the market. The good, better, best value propositions. Our specialty businesses as we continue to introduce new and innovative products have allowed us to enhance the mix of the business. As I said earlier we believe that in this quarter the decline in the residential market probably impacted our overall revenues roughly a point. It is very difficult for us to know that precisely given the various channels that we access the market but we feel very positive about the growth we have been able to show in the quarter and our ability to continue to maintain our price discipline. Again, I believe it is a reflection as I said earlier of the product portfolio. Our team is doing a great job of introducing new and innovative products and continuing to do that as well as productivity. So, it is my view that you will continue to see that positive mix as well as us continuing to go after various segments of the market with products that have features and benefits at price point that make sense for that portion of the market. Matt McCall - BB&T Capital Markets: Okay. I understand I think better. If you maybe use the baseball analogy again you talked about the mix shift and moving that area where you have been strong in the market previously to higher margin products. How far along are you in that game? I’m basically trying to understand what the margin benefit that remains is.

It is impossible to always predict how new products will be received in the market place and what their acceptance will be and then therefore their price points. I believe that the innovative and the teams that we have focused on creating some innovating new products have some great things on the drawing boards whether it is current core technology, core lamp ballast technology with better capabilities, energy efficiency, and better lighting output, there is a lot of runway left there. I’m very excited about the LED products we have on the drawing board that we will showcase at the upcoming Light Fair. So I feel that we continue to drive innovation with technology coupled with our strong capability around optics and thermal management. You’re going to see again continued new products being introduced that we believe will have very positive acceptance into the market place that will allow us to differentiate and continue to add value irrespective of what the economy does because these things have pay backs for them. They enhance the lighting experiences within the retail space. They enhance lighting experiences within the work spaces. So I believe that we are kind of early in the game as well. We continue to invest very heavily in our engineering capability and our design capability so I feel we are early in the game there as well.

Matt I would add as well that if you looked over into this Acuity Brands Technology Services business that Vern spoke to earlier we are extremely early in our development of those opportunities and businesses and as we see this relighting retrofit market as we see services and some of the capabilities that we are looking at there. Again we’re not looking at batting practice yet in some of those much less in the game in terms of what inning we are but those too could provide opportunities for growth as well as margin expansion beyond the traditional lighting fixture part of our business. Matt McCall - BB&T Capital Markets: Okay that is helpful. One last question. You spoke about the price increase you are pushing through in early May, I believe. Can you talk a little bit about industry pricing overall? It doesn’t look like you are seeing any declines or weakness in industry demand. Has the industry pricing environment overall remained stable or have you see any changes there?

We believe that the industry has recently for many of our competitors, I shouldn’t say the industry but many of our competitors that we monitor, have also put forth price increases that are effective around the same time as ours and kind of in the same range it appears. We are all experiencing the same cost and cost increases are significant so none of this surprises me. From a pricing perspective we don’t see any significant changes in the environment at this point in time. Even in the residential side where values are off relatively significantly we see price being relatively consistent, it is just that the volumes are off. I believe that from a pricing perspective there has not been noticeable change in the market place. Matt McCall - BB&T Capital Markets: Okay thank you.

Our next question is coming from Sean Boyd with Westcliff Capital Management.

Good morning. Just a couple of questions if I could. On the back log dropping here and your commentary on what caused that it sounds as though with the March orders back up you all would expect this to be just a temporary blip down and we will go back to slow growth in that back log?

Well I’d like to comment on the fact that back log is becoming less of an indicator of future vitality particularly as we lessen both our stock up times in our facilities and cut our lead times. As we continue to provide a differentiated capability vis a vie lead times in the market place it is our hope and expectation that customers will take advantage of that and allow them greater flexibility in their design phase knowing they can wait longer and rely on us to deliver a product when they need it. So as a consequence what we are seeing and it is a benefit that we have been working very hard on is to deliver when the customers want it precisely. So those cycle time reductions will have the impact on a go forward basis of having less back log but our incoming order rate and up line growth is where you’ll see the benefit in that a better indicator period-over-period growth of the vitality. That’s why we made the comment if you will on our March order rates because we wanted people to understand that order input is positive compared to the year ago period.

Got it. So maybe you can help me further. Does that mean that basically the amount of the business in turns that we actually never see in that back log would be increasing?

Yes.

Can you give me a feel right now how much of your business is in turns each quarter?

Well you saw that we were up roughly 9%. If you back out foreign currency and you back out Mark Architectural Lighting you were up about 7 points. We tried to give as best we can it is truly a guestimate as to what the impact of what we believe the decline in the residential market to be. So our input, our orders coming in if you will in the quarter we believe on the non-residential side were up north of 7%. So that was pretty robust.

Got it. Okay that is really helpful. Thanks. The other thing about the retrofit business where you guys are focusing a little bit more on that and you set up a separate division. I would understand on a day to day basis you’ve got that retrofit band throughout the business and I was just wondering if you want to quantify that in any way in terms of what percentage of new orders are really driven by that decision.

The answer is no, we don’t have that data available to us. But what we are seeing based on the products that we have introduced over the last couple of years and the markets that they are targeted towards that the growth in some of these products really are targeted at more of folks relighting their facilities to garner or capture, if you will, energy savings, better lighting experience as well as many companies and CEO’s are trying to lessen their foot print, becoming a more sustainable organization – we ourselves are doing that and doing it successfully. So we are seeing whether it is through our package agents, our national accounts or other access to markets we see people who are very interested in the story around how can we create a better value proposition. As Ricky pointed out on previous conference calls paybacks on many of these investments in light fixtures can be two years or slightly more than that. So it is very attractive. Unfortunately quantifying that at this point in time is very difficult.

Okay. Just one more question in the balance sheet. I see $160 million in debt moved into current portions. Can you all just remind us what that is and if you plan on refinancing that?

Yes that is our public debt that we have outstanding that is due February of 2009. So within a year we classify that as current. We also have a $200 million [trance] that would come due in November of 2010, I believe. August of 2010. Our current plan is to continue to look at what is the most efficient use of cash and capital to create the most value for shareholders but we are certainly given the cash generation and all could be prepared to just retire that debt and not refinance that. We are obviously looking at other uses of cash whether it is mergers and acquisitions, obviously we have been aggressive in buying back stock, obviously have the dividend out there and we will continue to assess all those. Our current plan now given the strong cash flow is to look to retire some of that debt.

And based on cash flow from operations for the first half of the year you are running about $110 million a year in terms of a run rate on cash flow from operations.

We would be disappointed if we did that in 2008.

Another point that I ought to make on the cash availability, we do have a lien of credit of $250 million we just put in place mid last year with no real use of that other than some letters of credits that are using that so we clearly have additional sources of cash as well when that debt comes due and we look at other uses of cash. But no I’d agree with Vern, we would be disappointed if the cash flow wasn’t greater than that.

What is the target for cash flow for fiscal 2008?

We have not provided that forward-looking information.

Okay. So given the disappointment of something not above that $110 I just mentioned.

We just said we would be disappointed in your number and didn’t go beyond that.

Understood. Thank you very much, gentlemen.

The next question comes from the line of Michael Regan with Janus Capital.

Hi Vern. Hi Ricky. So Vern or Ricky, a lot of consternation kind of in the market about the steel price increases especially sequentially first quarter over fourth quarter and year-over-year while a lot of people expected steel to be kind of flat year-over-year in 2008, just wondering how to think about how your contracts run and how to think about how to think about steel cost increases which seems to be a pretty big part of the fixture business versus how you are thinking about price and how those two flow throughout the rest of the year?

That’s a good question. We believe that steel will rise for lots of different reasons and we are seeing that. Our contracts take us out and we are kind of layered in if you will but we are not super hedged or super far…I would say at best we are out a quarter or so and what we are doing, Mike, is passing on those cost increases in the form of higher prices. I believe that reading the commentary from some of our other competitors they too noted steel cost increases as one of the motivations for price increases into the market place. It is our sense that steel will continue to rise for lots of different reasons and we continue to be very focused and vigilant on our pricing posture around that. So it is my expectation we will continue to stay reasonably in front of that potential spike.

Right so I guess that is the bottom line question. It seems like 30-40% spot increases and I know it depends on the grade you use, but does 3-10% price in May kind of keep you ahead of or sort of equal to 30-40% spot as of right now as you roll those contracts off a quarter or two quarters forward?

We believe the current increase will keep us at parity depending on again the fixture, like I said at parity for at least a couple of quarters.

Very helpful. Thanks.

The next question comes from the line of Satish [Athavin] with KSA Capital. Satish [Athavin] - KSA Capital: Hello, good morning. I was going through your outlook statement and you say that basically the back log was down as a result of a number of factors and then you say a reduction in late back logs. Can you elaborate on that for me?

Yes, a very good question. As we continue to enhance our service as our supply chain in it entirety becomes a more effective supply chain not only improving its productivity but its ability to serve our customer base by delivering on time, complete and doing it on a more consistent basis we are reducing the amount, if you will, of past due that we find in our back log – past due to customer delivery date. In the past that number…and it has been coming down really quite dramatically but on a period-over-period basis was down sequentially. I believe it was down roughly $1 million quarter-over-quarter and that is just a reflection of us becoming a better, more consistent and efficient supplier. Satish [Athavin] - KSA Capital: Okay I see. And as you look forward actually in the market when you kind of scour for new project activities what are you actually seeing in terms of new projects being proposed or put on the drawing board?

Well I’ll contrast the two. I mean all of the certainly public available information leading indicators whether it is architectural billing index, contract awards, all that information is out there on its own, but it is very current. In other words the decline in architectural billing index which some people view as a leading indicator of what may happen 6, 12 or 18 months down the road dropped off significantly in February. Personally I don’t believe that one month makes a trend but yet it is worrisome to us. Just recently we have had all of our agents in town for various meetings and our folks continue to be busy working with specifiers, working with distribution and while we all read the newspaper every day and have concerns about that when we come to work it is still kind of business as usual and there is still quite a bit of activity out there. We do see geographies where they are being hit particularly hard by this decline in residential home building. That has had some spill over into the non-residential side. I think on balance we continue to see projects out there that are interesting whether it is institutional projects, larger commercial projects, we still see business out there. How some of these other activities like tightened credit standards…how those things impact development I think that still remains to be seen quite frankly. Satish [Athavin] - KSA Capital: Thank you.

The next question comes from the line of Peter Lisnic with Robert W. Baird & Co. Peter Lisnic - Robert W. Baird & Co: Hi Vern. Just on the energy efficiency of your new products I’m wondering if you can kind of give us a sense of what the vertical integration that has recently happened in the industry. Do you think you are at all technically disadvantaged compared to a more vertically integrated competitor to address things like new products and energy efficiency specifically and I guess the second part of that question would be is that potentially a source of acquisition opportunity for you?

Our strong view is that some of this vertical integration is really not an inhibitor to our ability to create new energy efficient products. In fact, we see it as an opportunity frankly. There are folks all over the world who are each and every day coming up with new and more creative ideas on how to advance, if you will, the lighting driver side. The guts inside the fixture. But at the end of the day it is how you direct that light source, how you direct that light source, how you create the experience, how you manage the heat and how you do it in a way that allows these energy savings to occur with a better lighting experience to be had. So we believe that the world is our oyster in that regard and there is plenty of opportunity out there to find folks and work with folks who are leading edge technology. Peter Lisnic - Robert W. Baird & Co: Okay but not really necessary. You don’t feel compelled to go out and get someone who is “in the guts” of the system, if you will?

Let me be very clear. Someone can come up with an LED dye, but how that dye gets incorporated into the fixture there is tremendous intellectual property around that and we bring great value into that process. Hence, our own intellectual property the expansion of our intellectual property and the investment in our engineers, there is an awful lot in technology that is being brought together by us and our view is we do not need at this point in time to own, if you will, dye manufacturing capability. There are people out there who do that very, very well and there are many people who do that very, very well, but how those things get incorporated into a fixture to create the right lighting experience at the end and manage it in the most energy efficient way that is our game. Peter Lisnic - Robert W. Baird & Co: Okay. That is very helpful. Thank you.

Our next question is coming from Mr. Sean Boyd with Westcliff Capital Management.

Just a follow up on those price increases, if I may. When did you announce them?

We announced them about three weeks ago. About mid-March.

Okay. And has that had any impact on the year-over-year gain you have seen in terms of the orders in March, just pre-buying ahead of these price increases?

No, we wouldn’t typically see that type of activity until it gets much closer to the effective date.

More like in April?

Yeah, which would be the end of April.

And what were the price increases last year?

Our price increases last year were effective around the first of August and were in the 3% or 4% range. It varied again by product so it is impossible to tell you precisely but the range was kind of in the 3-6%. I would say more on average of 3-4%.

Okay. 3-6…I’m confused. In this point you are going 3-10%.

Well you had asked about last year.

That’s correct. Last year at 3-4%, is that what the original proposed increases were or were they 3-6%?

The range, dependent on product, similar to this year and similar to what is happening effective May 5th, we said that the range is 3-10% depending on the product. Without giving specifics as to what that mix would look like it is the range. Last year our price increase was effective around August 1 of 2007, the range was 3-6% or 3-7%. The average was about 3%. Slightly north of 3%.

Got it. That is helpful. Lastly you made a comment earlier about the residential slow down spilling over into the non-residential in certain areas. Can you give us a little more color on that?

Sure. Just imagine that you are in Florida and you are building a new neighborhood, a new neighborhood that has streets and those streets have street lights. We make a number of fixtures that support, if you will, that infrastructure. That neighborhood then has probably a strip mall. It has a bank. So we see collateral fall out from the lack of residential development in the commercial operations and that is what we were referring to vis-a-vie geographies. Certain geographies are experiencing some slow down in the non-residential side due to the decline in the residential business. The 1% that we believe roughly impacted our sales is really the stuff that goes through the home improvement channel that would go through national show rooms and those kinds of things. So it is a more direct impact. It is impossible for us to measure the indirect impact though it is there.

Understood. But specifically those geographic markets where you are seeing that. So that would be Florida. I assume maybe southern California. The areas where we have seen the biggest weakness in home building?

Sure. Phoenix.

Okay. Good enough. Thank you.

Our next question is coming from Michael Regan with Janus Capital.

So Vern if I remember correctly you joined Acuity as CFO kind of very late 2001 or early 2002?

I joined on the day of the spin from when they stopped Acuity Brands from National Service Industries. That was December 1, 2001.

Right. So as I look back the ABI had kind of been sub-50 for most of 2001. So you kind of got there as on the ABI statistics commercial was starting to roll over. So I guess just for perspective what your experience in the 2001, 2002 and 2003 time frame, how do you contrast that to kind of the early indicators you are seeing now and the ABI for February is only one month. But more importantly how you kind of prepare the organization if that February read on ABI kind of continues and because it is a leading indicator can you get the organization ahead of the curve on expenses or do you just kind of have to follow the trend down relative to what your customers and distributors want?

Mike that is a great question. If you go back and you look at the non-residential construction market on an inflation adjusted basis, the peak which was roughly 2000 down to the trough dropped roughly 28%. If you look at what Acuity Brands Lighting was able to do during that time period, our top line grew at a kegger of something north of 3%. I believe very strongly there are a couple of key things that we need to do and we are doing. One, we need to continue to drive productivity into our business. We are doing that and we are doing that very aggressively. We are redeploying that investment or the gains from that productivity into new product development. The new product development is really driven at energy related fixtures that create a better lighting experience that have pay backs for folks. So not only do we believe we can continue to show growth because we see new opportunities. For example, the opportunity in New York City. We had virtually very little share in New York City. As Ricky mentioned earlier we are introducing the full capability of Acuity Brands Lighting into New York City. We are introducing the Lithonia brand where it is New York City compliant. We have acquired Mark Architectural Lighting. We have a sales office in New York City to fully represent our brand. That is a $250 million market locally that we really had very little share in. It is our expectation to gain as we expand our access to market as we bring out new products that have an energy story and a retrofit story we see that $100 billion market, our ability to free up some of that and get after that market place. Others are getting after it too but we think we have better features and benefits to offer. So new products, expansion of market as well as productivity gains I think are going to be the key to us really thriving during this next opportunity. We also believe, Mike, that there will be acquisition opportunities to enhance our portfolio and our abilities. We are going into it with a very aggressive attitude about how we can win in that environment.

So the 3% growth where your biggest end market was down 28 is obviously very impressive. Can you, maybe you can’t off the top of your head, but can you just give some perspective on how much of that was the fact that residential was still doing reasonably okay during that time period and how much was just straight share that you took in the commercial or non-residential space?

As you know and as our shareholder base knows, our exposure…our direct exposure to the residential market unfortunately during that time period and it continues to be but was very low.

Fortunate now, right?

Exactly. So the fact of the matter is we didn’t have the opportunity to enjoy sort of that benefit of that rising residential market during the 2000-2006 time frame as much as some of our competitors. But nonetheless we see opportunities in our market place to continue to evolve that and we think that the residential market on the longer term basis will be an important market. It is a market that we have interest in and think that we can offer products that have features and benefits that make sense. We’re not in it right now so we’re not experiencing as much of the down turn as maybe some of our other competitors are at this point in time. So it is a bit difficult for me to say how we will perform and what the next cycle will look like because I’m not necessarily convinced of what that cycle…I don’t think given what we have seen and the prognosticators that are out there that are smarter than me about some of these things…I don’t think the next cycle is going to look like the previous cycle. Nevertheless we are positioning the company irrespective of the cycle to perform well.

Great. Very helpful. Thanks.

As a reminder, to ask your question please press *1 on your touchtone phone. You will be announced prior to asking your question. One moment for the next question. At this time we have no further questions. I will now turn the call back to Mr. Vernon Nagel for the closing remarks.

Thank you everyone for your time this morning. We continue to believe we are focusing on the right objectives, deploying the proper strategies and driving the organization to succeed in critical areas that deliver on the expectations of our key stakeholders. Our future is bright and thank you for your support.

This will conclude today’s conference call. Parties may disconnect at this time.