Good day, ladies and gentlemen. Thank you for standing by. Welcome to this morning's Belden Incorporated Conference call. Just a reminder, this call is being recorded. At this time, you are in a listen-only mode. Later, we will conduct a question and answer session. (Operator instructions) Now, at this time I would like to turn the call over your host, Ms. Dee Johnson, Director of Investor Relations at Belden. Please go ahead, ma'am.

Thank you, Trisha. Good morning everyone and thank you for joining us today for the second quarter earnings conference call at Belden. With me here in St. Louis today are John Stroup, President and CEO of Belden, and Gray Benoist, Vice President of Finance and Chief Financial Officer. Some logistics. We have slides on the web. To see those, please go to investor.belden.com and sign onto the web cast there. There are also posted, so you can print them. There's no www. It's just investor.belden.com and if you need a copy of our press release, you'll find that on that web site as well. During the call today, management will make certain forward looking statements. I would like to remind you that any forward looking information we provide is given in reliance upon the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. The comments we will make today are management's best judgment based on information currently available. Our actual results could differ materially from any forward looking statements that we might make. However, the company does not intend to update this information to reflect developments after today, and disclaims any legal obligation to do so. Please review today's press release and our annual report on Form 10-K for a more complete discussion of factors that could have an impact on the company's actual results. This morning, John will begin with comments about the performance of the business in the second quarter, Gray will review some additional financial results and segment analysis, and then John will speak about our outlook for the business for the remainder of 2008, and then we'll open the line for questions. So at this time, let's turn to our President and CEO, John Stroup.

Thank you, Dee. Good morning everyone. Would you turn to slide 3 please. Today, we reported record adjusted earnings per share of $0.97 for the second quarter. Adjusted net income grew 14.5% to $45.8 million and earnings per share grew even faster 23% year-over-year due to our share repurchase activity. As we said in our press release this performance is driven by our improved business portfolio and a number of margin improvement initiates were pursued over the past 2 years. Turning to slide 4, our portfolio now includes a richer mix of highly engineered products including our industry leading Hirschmann, industrial Ethernet solution, our industrial connectivity business under both the Lumberg and Hirschmann brands and our growing enterprise connectivity business. We continue to reverse by ourselves [ph] geographically with now 30% of our revenue in EMEA, 20% in Asia and only 40% in the United States, and we have a better mix of vertical markets having exited the telecom cable business completely and bringing more products and marketing resources to bear on attractive verticals like industrial automation. In addition to our improving revenue mix, we have focused attention and resources on margin expansion initiatives across the manufacturing in commercial themes. We restructured our North American cable manufacturing footprint in 2006 and 2007, building a new plant in Mexico and closing 5 plants in the United States and Canada, programs that are providing significant savings as planned. We are now 2 years into the implementation of Lean Enterprise Methods in our business both in manufacturing and in the back office. The benefits of Lean include increased productivity. Lean underlies our category leadership in productivity and inventory utilization. We are continuously working on the management of our product portfolio. This quarter, LTK, a $300 million business, has improved our operating margins by…

Thank you very much, John. Good morning everyone and thank you for joining us this morning. I'll begin my comments with a discussion of the consolidated results of operations for the second quarter, then turn to the segment results, followed by cash flow, asset management, and working capital. Second quarter revenue of $556.3 million was an increase of 1.2% year-over-year. Primarily a strengthened Euro created a translation benefit of $28 million in our year-over-year sales. In the calculation of organic growth we need to make certain additional adjustments. The second quarter of 2007 included sales generated from the Czech telecom operation and the Czech assembly businesses both of which we sold last year. Also, the second quarter of 2008 must be adjusted for Lumberg automation which we did not own until May 2007. Taking these elements into consideration, year-over-year organic revenue growth was a negative 2.4% for the quarter. Sequential revenue growth, however, was 8.7%. Let's take a look at our revenue mix on slide eight please. Starting on the left, revenue in the United States was 41%, Canada 6%, Europe 27%, and Asia 21%, continuing our intended diversification of regional revenue for the better balanced geographical representation of our served markets as we have been discussing over the past year. The pie chart on the right depicts revenue by vertical markets. Revenue in the industrial market expanded to 45% of total revenue. Sales in this vertical grow both sequentially and the year-over-year driven by excellent performance in the Hirschmann and Lumberg brands, which more than offset the challenges we are addressing in North America with respect to low end industrial cable products. The networking vertical was 26% of our revenue. Revenue growth in the attractive segment of this vertical represented by fiber, F6 and above, cable, and connectivity grew…

Thank you Gray. In June, when we announced the acquisition of Trapeze Networks, we confirmed our outlook for our existing business and updated our view only for the effect of the acquisition. The picture remains the same today. Like others, we find the macroeconomic environment to be uncertain, however, we remain confident in our ability to execute in times of slow economic expansion. We are maintaining our revenue outlook at $2.2 to $2.3 billion. We expect that our operating margin will be between 11% and 12% adjusted for charges and that adjusted EPS will be between $3.15 and $3.35. We are currently engaged in our annual strategic planning exercise and I'm looking forward to sharing an update with you in the fall after we have discussed the plan with our Board of Directors. Many of our investors have expressed support for the idea of further share repurchase activity. That is certainly something we consider, but we are unlikely to make a decision on such a course of action outside the context of our overall board review of the strategic plan and our priorities for use of cash. Thanks for all of you on the call for your interest in Belden. This concludes our prepared remarks. We now have some time for your questions. Our operator Trisha reminds you of the procedures for asking your questions.

Thank you Mr. Stroup. (Operator instructions) Mr. Stroup your first question will come from Matt McCall with BB&T Capital Markets. Matt McCall – BB&T Capital Markets: Thank you good morning everybody.

Hi, Matt.

Hi, Matt.

Hi, Matt. Matt McCall – BB&T Capital Markets: I think some of the comments – I just want to follow up on some of the comments about – you talked about the America in specialty you gave a lot of detail about what is going on in specialty. Sounds like there is still some pricing pressures there. I guess, I do want to get an update on your expectations there for the rest of the year, I was hopeful that some of that would have deteriorated at least – eased as we progressed through Q2, and then second part of the question in the American this outlook maybe I'm looking at different comps then your referencing, but it didn't look like the comps were that difficult from a year-over-year growth perspective last year, and so maybe provide a little bit more detail there and hopefully some detail across the end markets as to what was really behind the weakness?

Sure Matt. First of all, I think we tried to say any way that in the case of Mohawk, which was a business that struggled a bit in the first quarter with some of the issues around pricing, we did a see significant improvement sequentially. I think Gray mentioned that we saw almost a 500 basis point improvement in operating margins in Mohawk from Q1 to Q2. So, I think we feel quite good about the improvement in that business and I think that we're moving in the right direction. We did see some continued weakness however in the low-end industrial cable business in the second quarter. That was a continuation of what we saw in the first quarter. Our margins in that business have never been particularly good and as certain companies have taken advantage of a weaker dollar producing products in the United States and selling it in Canada we have walked away from such business 3320 (inaudible) unacceptable margins. But again we saw sequential improvement in that business as well. As it relates to the revenue situation, what we are trying to help people understand, Matt, is that in the second quarter of 2007 there was a significant amount of revenue shipped that was booked for delivery in the first quarter. We were unable to ship it in the first quarter because of the spike in demand and also because of some of the manufacturing moves that we were doing and therefore our year-over-year comp was difficult in Belden Americas especially. That was somewhat the case in Mohawk as well, but especially the case in Belden Americas. When you look at our growth sequentially, I think what you will find is we had a fairly normal pattern this year sequentially and our pattern last year was fairly abnormal. We grew almost 18% sequentially last year from Q1 to Q2, which was not customary in our business, and I think if you look at not just our numbers but maybe numbers of other people in our space, I think you would find something similar in terms of the sequential pattern that we saw this year being normal to what we have seen in past years. Matt McCall – BB&T Capital Markets: Okay, and then as it pertains to the end markets in the U.S., can you just add a little bit more there?

Matt McCall – BB&T Capital Markets:

Well, the Asia business continues to perform very well. We didn't share with you the Belden branded growth because it is part of a segment, but the Belden branded growth in the second quarter in Asia was above 40% again in this quarter. The other thing Matt, that I did mention is that our networking systems business grew 47% in the first half compared to prior year. That is significant because it represents I think our ability to sell systems effectively, and I think it also is a good example of where our team in Asia has done a nice job of upgrading our commercial talent. So, we thought it was worth noting. The other thing I would like to mention Matt is that we have been making I think very good progress here in the last quarter with regard to how we serve the industrial market. I talked a little bit about a few wins we have gotten where we have been able to help customers come to the conclusion that they'll be better off buying the switch, the connector, and the cable all from Belden and I think we are going to continue to see traction with that initiative through the year. That is exciting for us for all of the things that we have talked about but it is also exciting because we're really replicating the same initiative on the enterprise space by bringing together fiber, cable, and connectors and wireless and so the integration of Trapeze now in our view is quite similar to where we're a year ago with Hirschmann, and we couldn't be more happy with the results of Hirschmann. Matt McCall – BB&T Capital Markets: Okay. Thank you all.

You are welcome.

Our next question from Jeff Beach with Stifel Nicolaus. Jeff Beach – Stifel Nicolaus: Yes, good morning.

Good morning Jeff. Jeff Beach – Stifel Nicolaus: Great quarter.

Thanks, Jeff. Jeff Beach – Stifel Nicolaus: Two things first of all, actually three questions. One is easy, second quarter cost savings of $3 million equal to cost savings of $26 million of $3 million in the first quarter, was this below your expectation, were you looking at cost savings ramping up through the year, and it sounds like you are still working at the full 26, but rather than a ramp up it is all hitting in the second half. Is this accurate or they did fall short of what you thought you would get?

No Jeff. It was pretty much where we thought it would be. We had $3 million in the first quarter which annualizes to 12, we had an additional 3 in Q2. So that annualizes to 24 in Q2. So, we are really pacing exactly as we thought we would pace and we remain very committed and confidential to $26 million for the year. Jeff Beach – Stifel Nicolaus: Okay, it was 3 million additional?

That is correct. Jeff Beach – Stifel Nicolaus: You probably don't have or willing to give margins on your acquired businesses but particularly with Hirschmann and Lumberg are you seeing – ?

They are very good. Jeff Beach – Stifel Nicolaus: Are you seeing better margins at those companies than overall you are up?

Yes. Let me answer it in two ways. First off, the gross profit of those two businesses as we described are significantly greater than our cable businesses and our operating margins are now starting to trend up higher than our cable business. But remember Jeff our cable business two years ago was a break even business, now it is a double digit business. And our Lumberg and Hirschmann businesses are certainly north of double digits now as well. But those are businesses that we are very, very pleased with their results compared to where they were a year ago. Jeff Beach – Stifel Nicolaus: And LTK the product pruning moved up the profits sequentially meaningfully and I assume then year-over-year as well?

Yes, that is correct. Jeff Beach – Stifel Nicolaus: Last thing, just a little bit more on – I think most of the concern this morning of the press release was North America sales. Can you give us some flavor for year-over-year now comparisons declines in CAT 5, and in low-margin industrial, can you help a little bit there with magnitude in some way?

Sure. There are three things that I think that are worth talking about. First of all we continue to see that the more desirable product lines, for example, the higher end category products as well as the more desirable industrial products are growing at rates that we would expect and the lower end products, ones that are not contributing at the same margin levels like the low- end industrial cable like CAT 5 are either not growing or in some cases they are shrinking and in ways that are quite purposeful. Secondly is, I think if you look at our year-over-year comps and you look at where we went sequentially from Q1 to Q2, I think, you are going to find our sequential growth is very, very similar to the other companies within our category. In the second quarter last year, we had a lot of products that shipped that were some scheduled to ship in the first quarter. We would have preferred to ship it in the first quarter of ’07, but we were unable to, and that created a lot of shipments in the second quarter of '07 that were just mistimed. The other thing that is worth noting is that we continue to see in the second quarter that our point of sale or sell through data from our channel partners is significantly higher than our sell to channel partner data, and we believe that is because our channel partners are more carefully managing their inventory right now than they did a year ago. So, at some point that begins to catch up and you can't have point of sale information that is in excess of the billing information, the billing data forever. So, the fact that we have seen strong point of sales, the fact that we're seeing strong sequential growth certainly gives us reason to be confident in our top line. Jeff Beach – Stifel Nicolaus: All right. Thanks a lot.

You’re welcome.

Our next question comes from Celeste Santangelo with Merrill Lynch. Celeste Santangelo – Merrill Lynch: Good morning.

Hi, Celeste. Celeste Santangelo – Merrill Lynch: Hi. So – looking at the outlook, you know, given the numbers that you just put up from an operating standpoint it looks like keeping the full year outlook, it seems you are little more cautious towards the back half of the year, and I was wondering if there is something you can specific you can maybe point to beyond just the general uncertain economic environment. Is there something you saw during the quarter that is giving you reason for increased caution?

No, there is nothing specifically that gives us reason to be cautious in the second half. I think that our view right now is that the macro environment that we're all living in right now is a little uncertain. It is certainly more uncertain in certain industries than others. I would to be in the financial industry right now, for example. But in our markets we are still subject to the same macro environment that others are, and therefore we thought it was appropriate to conform our guidance for the full year and obviously we're going to work as hard as we possibly can to do better than that like we did in the second quarter. Celeste Santangelo – Merrill Lynch: Okay, and then last quarter for North America it sounded like demand trended up as you exited the quarter and headed into Q2. Can you talk about the linearity in Q2, and then heading so far into Q3 in North America?

Yes, I mean, I didn't study it perhaps that closely, but I would say that there was a little bit of strength exiting the quarter from our point of sale information but I wouldn't say it was overly pronounced. I would say we are relatively linear within the second quarter, nothing significant, it is not like we entered Q2 real weak and exited it real strong. So, I mean I think that the thing we are focused on in North America, of course, is continuing to see sequential improvement, monitoring our sell through data very closely with our channel partners and making certain the things necessary to gain share in the product categories we like and the manage the operating margins and the gross margins in the product lines that are not strategic. Celeste Santangelo – Merrill Lynch: Great. Thank you.

Thanks a lot.

We will go to Jonathan Braatz, Kansas City Capital. Jonathan Braatz – Kansas City Capital: Good morning gentlemen.

Hi, John. Jonathan Braatz – Kansas City Capital: Good morning. Dee.

Hi. Jonathan Braatz – Kansas City Capital: Gray, when we talked on the conference call about Trapeze you noted in there that there might be some nonrecurring amortization charges and some severance charges related to the acquisition. Have you been able to quantify that anymore, give us a little insight as to what those charges might be?

4435: Jonathan Braatz – Kansas City Capital: And how did you finance that acquisition, you were somewhat – you did have a – you were – you were looking at cash and borrowings, how did that all end up?

We utilized the revolver John. So, we drew down $133 million on the revolver to pay for the Trapeze. The interest rates we're getting on the revolver interestingly, let's take the LIBOR, it is actually underneath the convertible rate. So, it is a fairly effective utilization of borrowing capacity. Jonathan Braatz – Kansas City Capital: John. the other thing I was going to mention is, you know, I read from other companies, that was a little bit of concern about the growth rates in Europe, things slowing there somewhat. Are you seeing anything that causes you a little bit of alarm, some concern about the growth expectations when you look at the European business?

Yes. I think that the second half will not be as strong as the first half from a demand perspective in Europe. What we're seeing is that the businesses that we have that are exposed to the broad economy in Europe are seeing a little bit of softening like we saw in the United States and then the product lines that we think can sort of power through because of the secular benefits, like industrial Ethernet, for example, we would expect to see those continue to grow and, of course, the mix of the product lines are favorable to us. So, I think generally we're going to see a little bit of weakness in Europe. By the way, it wouldn't surprise me if towards the end of the year we will see a little bit of weakness in Asia as well. Again it is comparative, we're still going to grow I think, but I think that the economic problems that we are experiencing in the United States are going to spill over into other areas. Jonathan Braatz – Kansas City Capital: Thank you, John.

We will take our next question from Nat Kellogg with Next Generation Equity Research. Nat Kellogg – Next Generation Equity Research: Hi, guys. Nice quarter. Just a question. I know in the past you guys have talked about, you know, with the negative kind of growth, some of it is just due to, John, you said trying to refocus products and stop selling somewhat lower margin products. So, just wondering if you can give a little color on how much of the slowdown was sort of real slowdown from western end of the product and maybe a little color on how much are you guys sort of refocusing your product and your sales effort to try and capture the higher margin sales?

Well, in raw terms, in the United States we had somewhere between $10 to $15 million in the second quarter of volume that we absolutely purposely moved out of the portfolio because the margins were not acceptable and that was largely in our industrial category type products. At LTK, I think that there was probably 10% of their top line that got moved out because the margins were not acceptable and then I think the rest of the portfolio, if you look at it and again the reason I am going back to sequential is that those product lines sequentially grew very nicely and the difficulty in the year-over-year comp has more to do with 2007 than it has to do with 2008. Again 2007 we had a lot of products that shipped in the second quarter that were scheduled for the first, and then we did see continued inventory reduction in our channel partners in 2008. Obviously, at some point that had corrected itself and there will be quarters where we will see the opposite happen, but those are the two big areas Nat where I think we saw portfolio management. Nat Kellogg – Next Generation Equity Research: And then I would expect that you guys would continue to keep that disappointment going forward?

Yes, absolutely. The only caveat that I would say now is that in cases where we know that we have got a manufacturing cost structure that is going to improve because of the footprint actions that we have taken, we'll hold on to that revenue even if might be at slightly lower margins because we know we can realize acceptable margins in a relatively short period of time. Nat Kellogg – Next Generation Equity Research: Okay. That's definitely helpful. And then if I look at, I guess the back half of the year you guys at one point I'd think it is maybe Q4 – it is not Q4 – you did at one point have sort of a little bit elevated R&D spend with the Hirschmann sort of in the back half of last year. Is that correct and I assume that that probably won't be repeated this year although you guys are continuing investing?

You are right. In the fourth quarter, we did see a spike in R&D spending at Hirschmann that is true. but I would say this, we do intend to continue to invest R.&D dollars in the industrial Ethernet business because we're seeing good growth rates and we're seeing real nice margin expansion. So, we are going to spend our money wisely, but we're very focused in keeping costs under control and continued investments that we make in R&D are going to be very targeted in the areas where we think the lifecycles are such that technology investment really matters. So, Hirschmann is a good example of that, Lumberg is a good example of that and of course Trapeze will be a good example of that. Nat Kellogg – Next Generation Equity Research: Okay, that is great and then last one, a little housekeeping one I think maybe for Gray, what was that the Czech business, what did that contribute last year. Just trying to get a year over year sense of what – how much that has contributed?

5022: Nat Kellogg – Next Generation Equity Research: Okay that is great, and it certainly had sense with Hirschmann was but the Czech number was helpful. Obviously nice quarter guys, that is all I have got and thank you guys very much.

Thanks Nat.

(Operator instructions) We will go to Kevin Sarsany with Galet. Kevin Sarsany – Galet: Hi guys, been a while.

Hi, Kevin, welcome back. Kevin Sarsany – Galet: Thank you very much. I have a question now. With the $26 million saving you are pointing to 11% or 12% operating margin. I guess looking a longer term, if you still have your goal of operating margin of 15%. At one point, you talked about 7 initiatives, I was wondering if you could kind of touch on some of those initiatives going into 2009 and those that are kind of in your control such as manufacturing consolidation, mix, kind of sales versus volume?

Sure. The initiatives are exactly the same Kevin. the things that are focused on it are no different than we spoke about a year ago or two years ago. Remember the 11% to 12% of course includes the impact of Trapeze and of course includes this deferral of revenue. So, on an apples-to-apples comparison our operating margin would obviously be exiting higher, just as we saw in the second quarter 12.5%. The things, of course, that are in our control is manufacturing footprint which we remain very, very confident with and pleased with our progress. Our Lean initiative, we are beginning to see some of the productivity improvements from Lean that we expected. Portfolio management, which showed up in the second quarter at LTK, Americas, and other parts around the world, and then I would say an even greater focus than ever in the company on bringing in high quality organic growth. We brought on a new executive about 110 days ago who has got an outstanding set of experiences with regard to industrial markets and in our strategic planning this year planning cycle this year we are focused more than ever on generating high quality organic growth. It is going to have fall through in our normal range around 40%. So, in 2009 , I think, you’re going to see the nice blend, you're going to see cost improvements, but I think in 2009 you will probably see a little more emphasis on the benefits of organic growth then maybe you saw in 2007 or 2008 where it was a little bit more focused on cost. Kevin Sarsany – Galet: The R.&D spending you are doing at Hirschmann, is that legacy, I mean it is ongoing – but is that part of trying provide a full solution for industrial automation and also I guess looking forward how does the Trapeze or if it does apply to industrial automation longer term?

Well, most of the engineering spend at Hirschmann right now is directed at making certain that their product line continues to be far in the lead in the markets that they serve. That is where Hirschmann has really always been very strong and the life cycles in those product lines, of course, are a lot shorter than they are with cables. So, we need to continuously make investments in the product line to keep them competitive and to keep them in a leading position. Going forward, however, I would expect that we would spend more R.&D dollars on bringing together the Hirschmann switch and some of the industrial wireless opportunities that we see for our industrial initiative. So we have already had important meetings, constructive meetings with our Trapeze team and with our Hirschmann team about how we can apply the wireless technology into markets beyond enterprise including industrial and we think we are uniquely positioned to do that given the fact that we have a strong capability and awareness in both markets. I would say the money we're spending to bring together solutions to the industrial enterprise market are probably most likely going to be in the sales and marketing area. So the spending that we have in Steve Biegacki group, for example, around how to address the opportunities in those markets as a complete solution provider as well you might see more increase, say for example, in 2009. Kevin Sarsany – Galet: Okay. just a – last one, what is your mix of plans in low cost versus high cost?

Well, we have a metric that we track which is the percentage of associates in our manufacturing group that are in low cost regions and remember when we acquired LTK that metrics skyrocketed because we have many of our associates in China, many of those associates are manufacturing people. So on an associate basis, Kevin, it is I think well in excess of 50%, on the production basis, I'm not exactly sure where it is right now but again it wouldn't surprise me if it isn't getting close to 50%. But why don't we follow up on that and get you a more detailed answer. Kevin Sarsany – Galet: You got it. Thanks.

Thanks Kevin.

We will now go to Keith Johnson, Morgan Keegan. Keith Johnson – Morgan Keegan: Good morning.

Hi, Keith. Welcome. Keith Johnson – Morgan Keegan: Just a couple of quick questions. I guess, first of all, lot of initiatives you have had to reduce cost within your manufacturing operation. Could you give us a little color on whether or not or how much you may have seen of inflationary pressures in your manufacturing operation whether with your raw material or fuel surcharges that sort of thing?

You know, we have been fighting that very hard. In fact, we probably did not do a good job as saying that all these savings came on top of combating cost increases in commodities. You know we talk a lot about copper but we probably don't talk enough about are issues with petroleum-based products, not to mention the fact that our transportation costs are going up because of oil prices. So our team has done a nice job of battling that and we did see increases in the second quarter of course with these effects of commodities, but our team has done a nice job of finding cost reductions to offset that and as we look at our full year outlook we have in fact incorporated the effects, the negative effects of commodities into our operating plan going forward and obviously we think we can do that then with other cost reductions. Keith Johnson – Morgan Keegan: Okay. Is there any way you kind of quantify the quarter, maybe in a matter of basis points, or something that did affect your margins?

I don't really know how to give you an accurate answer right now. I can just tell you that if I include the impacts of commodities around feedstock, petroleum feedstock, and I would include transportation costs. They are significant enough that they could have negatively impact our entire manufacturing savings in the quarter but our team was able to offset that. So, I don't know how to give you an exact number. We could try to estimate it and get back to you but it is material. Keith Johnson – Morgan Keegan: What about this environment ability to try to get some of that back as you look to the rest of your selling price loss?

Well, our team has done a good job I think of quickly acting on price changes that are necessary to deal with these items. Clearly most people are in fact aware of the rise in price of oil. So when we help them understand that our transportation costs are going up because of that, where our composite materials are going up because of that they are understanding a bit and as long as we just announce it in an orderly way than we are able to pass on the price increases. Keith Johnson – Morgan Keegan: Then I guess just one last question, just to make sure that I was understanding your guidance. Could you give me an idea of kind of what the economic outlook is, I guess, may be by geography that is your guidance for the year?

Y: Keith Johnson – Morgan Keegan: Okay. all right thanks a lot

Thank you.

And there are no further questions in queue at this time.

Okay that is great. Let me thank everyone again for joining us on the Belden earnings conference call. We appreciate your interest and you're welcome to give us a call any time if you have follow-up questions. This concludes our call today.