Ladies and gentlemen, thank you for standing by. Welcome to this morning's Belden Incorporated conference call. Just as 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. If you would like to ask a question, please press star one on your touch-tone phone. Your questions will be taken in the order they are received. If you are in question queue and would like to withdraw your question, simply press the pound key. I would now like to turn the call over to Mr. Gray Benoist. Please go ahead, sir.

Thank you Jennifer. Hello and good morning everyone my name is Gray Benoist and I am the CFO of Belden. Thank you for joining us today for the third quarter 2009 earnings conference call. Joining me on the call today from here in St. Louis is John Stroup, President and CEO of Belden. First on logistics, we have put a few slides on the web. To see these please go to investor.belden.com and sign on to the webcast. There is no www in that address, just investor.belden.com. Also if you need a copy of our press release, you will find it in that same location. 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 provisions 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 more complete discussion or factors that could have an impact on the company's actual results. This morning, John will begin with the comments about the performance of the business in the third quarter, after which I will review some additional financial results and segment analysis. Then, John will speak about our outlook for the business, and finally we'll open up the line for questions. So at this time, I'd like to turn the discussion over to our President and CEO, John Stroup. John?

Thank you Gray and good morning everyone. The realities of the global economic downturn continue to impact our year-over-year result in the third quarter. However, despite this challenging operating environment, we delivered better than expected results, including sequential revenue growth in three of our four business segments. Additionally, we realized a book-to-bill ratio slightly greater than one. Although, in our European segment, revenue declined sequentially due to seasonality, our focus on improving the segment's cost structure through product portfolio and restructuring actions yielded sequential improvements in both gross and operating profit. Our restructuring initiatives, which started in December 2008, generated $12 million of savings in the third quarter. This is $2 million better than planned, and we expect to be able to achieve a similar level of cost savings in the fourth quarter. This will bring our annual benefit for 2009 to $40 million with an annual exit rate of $48 million. It is worth noting that gross margins were higher than the same period one year ago despite the negative impact of substantially slower demand. Although Gray will discuss the following in greater detail in a few moments, I want to highlight the continued improvements we have made with respect to inventory returns. We were able to improve our inventory returns sequentially and year over year to all-time company highs. Such achievements in the face of these economic conditions are truly unique, and are an indication of our commitment to and our improved proficiency with lean manufacturing principles. For the second consecutive quarter, we generated free cash flow in excess of $40 million, resulting in a year-to-date total of just under $94 million. Our continued ability to generate significant free cash flow has allowed us to build our cash balance to $312 million, from $227 million at the end…

I'll begin my comments with a discussion of the GAAP results for the quarter, followed by a discussion of our consolidated results of operations. Then I'll walk through our segment results, cash flow, working capital and asset management and close my remarks with comments with respect to our global restructuring initiative and of cost saving measures. In the third quarter, GAAP revenue was $355 million, and the company reported a net loss of 16 cents per diluted share. We incurred restructuring charges of $8.8 million pre-tax in the quarter resulting from the continued implementation of our global restructuring initiative. Among this quarter's charges were costs incurred in the process of closing one of our Leominster, Massachusetts manufacturing facilities, and costs incurred in a relocation of German connector assembly operations to the Czech Republic. I will focus the remainder of my comments on adjusted results without these charges. For your benefit, a reconciliation table between GAAP and adjusted results has been provided as part of today's press release. We have also provided a new disclosure, which identifies these adjustments by segment, which is available on pages eight, nine and 10 in today's slide presentation. We hope you find these helpful. Consolidated revenue in the third quarter was $355 million a year over year decline of 32.9%, which includes unfavorable currency translation of $8 million or 1.5%. Revenue when adjusted for currency, acquisitions, dispositions and metal costs year over year declined 24.3%. Sequentially, sales grew 3.1%. The sequential impact of currency translation was a benefit of $6.5 million resulting in slightly positive organic sales growth quarter over quarter. I can have you turn to slide four, please. The geographic mix of revenue is shown on the left. Revenue in the United States was 43%, Canada 10%, Europe 21%, and Asia 20%. Revenues…

Thank you, Gray. If you could please turn now to slide 14, we are pleased with our performance in the third quarter, and we are encouraged by stabilizing end markets. As we look ahead to the fourth quarter, we expect the operating environment will remain competitive, driven by the need of some to improve manufacturing capacity utilization. For the fourth quarter of 2009, we expect adjusted revenue and diluted earnings per share to be in the range of $365 million to $375 million, and 27% to 32% respectively. We expect free cash flow generation in the fourth quarter to be in excess of net income. I would like to remind you that we'll be hosting an investor event in New York on December 9th to which you are all invited. For additional information, please call 314-854-8054. Thanks to 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, Jennifer, will remind you of the procedures for asking your questions.

(Operator Instructions). Gray Benoist, your first question comes from Matt Mccall from BB&T Capital Markets.

Good morning. This is Sean Connor for Matt.

Hi, Sean.

I am looking at the guidance for Q4, our calculation at the midpoint assumes really only at 25% contribution margin sequentially, I mean I know that you guys got more cost savings in Q3 than anticipated, so it kind of takes out that incremental benefit there. We've thought there had a little bit more flow-through as the volume improves sequentially. Just wanted to get an idea of how we should look at the going forward or may be what's pressuring that is it strictly price and can you give a little bit more detail there?

Okay, Sean, this is Gray. We have a $10 million to $20 million increase in sales sequentially. Some portion of that is margin driven, I'd say most notably around the seasonality effects that we witnessed in the third quarter, which should reverse themselves in the fourth quarter, most notably around the EMEA segment. But the other portion of increased sales were really not contributing to the bottom line based on just general levels of increase in copper. So the copper we ran in the third quarter results, somewhere around $2.62 to $2.65. Here in the fourth quarter, we're already looking at somewhere around $3 copper as of today. So the way to look at our fourth quarter guidance right now is a increase in our sales, just associated with that copper increase without margin contribution.

Okay. In Asia, imagine that we'll continue to see seasonal strength there. Is it possible for Asia to show year-over-year growth in Q4?

Sean, this is John. It's not clear to us whether or not that's possible or not. The business, showed - let me just say qualitatively - the business showed really nice improvement in Q3 versus Q2 and we started to see the decline in Asia, in early Q4, so whether or not those will intersect in Q4, it's not clear to me, but we do have an expectation that we're going to see the business in Asia in Q4 to be as good as it was in Q3, and I think there's a chance it could be better; but whether or not we can actually do better than the prior year, that I think would be a stretch.

Okay. I am looking at Trapeze, you said that you're going to increase your focus in that market or in that segment and still wanted to get an idea of just what the game plan might be, maybe what a timeline or estimates on win breakeven might be possible? Just kind of what type of actions could be taken there? I know most of the costs there are R&D related, and I'm not sure how much can be cut out of that?

Shawn, I think that we're going to be in a good position in December at our investor's meeting to share with everybody our expectations for all of our businesses, including our wireless business in 2010. So I'm going to go ahead and address that question at that meeting; but let me just make this comment. It's clear to me that we have a good end market that's healthy, customers are increasingly comfortable with the use of wireless technology, and we're beginning to see wireless become even more accepted outside of the early adopting markets, healthcare and education. So the markets themselves are growing. They're strong, and they include end markets that are less volatile. So of course, we love all of those things. From an operating point of view, though, we're not at a level that is acceptable and my view is that we need to have a much more balanced approach in that business, between the expectations with regard to revenue growth at or slightly above market, but also looking at how we become far more efficient in the way we run that business. There are really two major cost drivers, R&D, as you mentioned earlier, which is significant. The other, of course though is the sales and marketing investment that we make on the Trapeze brand of product; and as I’ve discussed in previous times, our able to get a return on the sales of marketing investment is also important. So I have confidence that we're going to see sequential improvement in this business, but I think it would be appropriate for me in December to share my expectations for 2010.

I think just finally you had $300 million in cash, arena opening up any? What's the use? Or what is the projected use for that cash? Anymore repurchase opportunities down the road? Maybe some ideas there, if you have don't mind?

As you can imagine at the start of the year, there was a lot of focus on making sure that cash reserves were appropriate, making certain that cash flow was inline with debt covenants, and clearly the situation that we're in now is a very good one, especially compared to others and especially compared to where we all were at the beginning of the year. We have the same strategic focus and discipline on acquisitions now as we've always had, which is that we're only going to make acquisitions that makes good strategic sense. And then secondly, financially it needs to hit our hurdle rates. Earlier in the year, one of the issues we faced was that sellers were sort of using the past as the valuation model, and I would say that's starting to change a little bit. Sellers are becoming more realistic with regard to the economy they're in now and what the prospects for recovery are. And therefore, I think that the possibility of doing smaller full time acquisitions that are inline with our strategy, I think that's very possible.

Your next question comes from Shawn Harrison from Longbow Research.

Hi, good morning, Gray and John.

We always like to have our Shawn sequentially.

Looking at Trapeze on another topic in terms of the operating losses this quarter, assuming the VSOE issue wasn't there, it looks like you would have lost $6.3 million on the EBIT line. Is my math correct?

We lost $6.8 million pro forma, and we would have lost $7.3 million in GAAP.

But and then as we look into 2010, I thought there was kind of an EBIT balance sitting somewhere that would roll on? How should we model that?

Here's the exact methodology to do so. And within the boundaries of our cash-flow statement within the disclosure, you can see the balances and the change in the balances year-on-year associated with our deferred accounts. But at the end of the third quarter, we had over $21 million worth of deferred revenue on Trapeze. Of that $17 million in change was short-term and $3 million of that was long term; IE longer than a year. Let's just deal with the $17 million or $18 million that’s the one year current deferred revenue balance. That will roll off next year, and it will roll off proportional to the way it was established on the balance sheet in 2008 and in 2009, and consistent with our accounting for Trapeze this year, we [pro forma] all of that negative impact. So when we discuss the results of Belden, we excluded the VSOE. But that said, there is $14 million worth of operating profit, or somewhere around $0.20, $0.22 a share of GAAP EPS performance next year, that again, is consistent with that Trapeze accounting. I think our position will be that we will continue to pro forma Trapeze so that you get a good operational view of the performance of the business rather than the accounting view.

No. That's extremely helpful. Getting back to profitability going forward, just on a short term aspect, if I take your comments on copper prices, it sounds like you're going to see pass through benefit of adjusting, sales prices for the higher copper prices you experienced during the past three or four months; but then there is also going to be probably an incremental margin headwind because of that $0.35 variance per pound, at least where it is right now and where is copper prices are to you? Is that correct?

Let me make a comment and Gray can fill at it if I am giving you the specifics you're looking for, but when copper is volatile as it is right now we are subject to short term variation in our results. And we described those in Q2 as being approximately $2 million favorable and we described that Q3 as being approximately $2 million unfavorable. In long run it doesn't really matter. But in the short run it can create a little bit of variation. The other thing we pointed to you that we do think given the sustained depressed levels of demand compared to the prior year, that the market will deal with some capacity utilization issues, and therefore, we've been very focused on and guarded against pricing pressure, having nothing to do with copper, just having to do with capacity, and I think we're in a great position to deal with that given the amount of focus we put on cost. But I think that we can see some challenges in the next few quarters dealing with just the issue of capacity utilization and how some companies are dealing with that through lower prices to try to focus on variable margin as opposed to overall profitability.

Would you pick out maybe regionally or maybe the industries that you're seeing kind of the most negative pricing?

I would say the greatest challenges right now are probably the United States, and they're probably in categories, where we tend to compete with cable companies, whose portfolio includes lower margin products. So there are certain cable companies that tend to operate in segments that historically have had lower operation margins than ours. When we compete with them they've had a different perspective on what a reasonable level of profitability is.

And then just two brief follow-ups. Operating expenses as we move to 2010, a lot of companies are seeing some costs come back. What is your thought there, and how should we model the tax rate in 2010? I know it's kind of a guess right now, but any range would be helpful?

Well, let me do the operating expense. I'll let Gray comment on the tax side. On the operating expense side, we feel like most of what we've done is, in fact, structural and consistent with where we want to take the business. So, let me use Europe as an example, because I have a lot personal experience in that over the last few months. I would say that more than 75% of what we've done as it relates to operating expense reduction will in fact stick on rising volume. That is to say we will get leverage as the volume goes up, because the things we did were structural in nature. There were some other things that we did with regard to cost containment that I would say are a little more temporary in nature that we would be interested in trading up over time. But I think when we share with you our thoughts about 2010 in December, we are going to be able to give you enough information to kind of [clean] how we view the cost structure going forward and how we would expect to get really very good leverage on incremental revenue.

Okay.

And then, with respect to the tax rate, Shawn, right now, we have a pretty good jurisdictional mix; but again, the more we improve certain businesses, i.e. most notably Trapeze, while as we improve Trapeze that moves the jurisdictional mix back to the U.S and again U.S. is a jump ball with respect to we really think is going to happen in tax rates over both the near term as well as the long term. So right now from modeling purposes this would be for EPS modeling purposes, I think you can use 30. and that's generally what we've been selecting as that sort of conservative level of taxation. That noted it won't work for cash flow, because again from a cash flow perspective, our tax rate would be less than that and if you want to have a conversation in more detail about what those drivers are, I will be happy to do.

Thank you very much. It's very helpful and see you guys in December.

Your next question comes from Gary Farber for C. L. King.

Okay, thanks. Just a couple of other questions on raw materials are there any other inputs that are sort of rising and could impact the results?

Nothing significant, Gary. Nothing on the raw material side is of concern.

And you're attributing in the sequential revenue pickup you are saying is pretty much solely proper in the fourth quarter.

No. And that's only it really two things. One is there is the copper piece we talked about but remember our European business always takes a seasonal dip in Q3, and we see it come back in Q4.

Okay. And I don't know if you touched on other income in the quarter, what was in there.

Other income for us is largely the joint venture in China with our business in Germany, the industrial networking business that we have in Germany includes a specialty device business where we have had a very successful operation in China, and as China recovered in the third quarter, I talked about, we did see benefits in the joint venture income

Okay. And then just lastly, on the any updates on the European management structure.

Well, the European management structure is same as it has been. With me the acting president of Europe, but we are getting, I think, quite a bit closer to a long term solution, and if we're fortunate we might be able to have details in December.

Okay. Thanks again.

Your next question comes from Nat Kellogg from Next Generation Equity Research.

Good morning, guys. Thanks for taking my question. Just two little things one is (inaudible) I just sounded like there's a nice pickup in business there, and I think, last quarter and also in Q1 you guys had said that you were sort of restructuring the product portfolio there and moving out in some of the consumer electronics and they historically had a big role and because of the margins weren't sort of meeting your standards, but here it sounds like the business has picked up there. So I was just curious if you could give us an update on where they're focused and any changes that have been made, and how that affected the numbers in this quarter?

Sure. We describe our Asian segment at the LTK business is in there, and the LTK business has great resources, manufacturing and insuring resources especially that we have, in fact, been moving over into what I would consider are more traditional markets. So you know the manufacturing capacity, is an example is been modified to deal with the Belden brand. Some of the engineering resources have been focused on the Belden brand. So that's really where we've been focusing - some of the change has been focused on the resources. But yeah you're right the LTK traditional business, the LTK brand of business had a very nice pick up from Q2 to Q3, it was over 30%. Some of that, of course, is the channel inventory correction that we saw starting really in Q4 to a very long supply chain we think coming to an end. So as we had expected and as we had forecasted, that was going to end, and we would begin to see returning levels of performance. But I think we're also seeing beyond that, some improvement in the markets as well. So it's hard to know exactly how much of each. I would say that the majority of the 30% is the end of the channel inventory correction, but I think some of this real end market demand picked up that we're seeing in Asia.

Okay. And on Nortel - I mean, I know that you guys are sort of said the way this unfolded is a positive for you; but at least in a short-term understanding is it - I had talk about sort of some product rationalization when they sort of combine (inaudible) and Nortel and the deal doesn't close until December and so my guess is in the Q1 we are going to have this sort of product rationalization. So I was just curious if you can just give a little more color on how you think that's going and if you seeing that affecting your business now from what I heard, you are sort of delaying on the Nortel side just because you're trying to see how this will all going to shake out an may be when you expect that demand going to come back.

Yeah. Well I certainly don't think that the issues or the things we have to deal with as it relates to Nortel, the bankruptcy and then sale is behind us, but I think our view is that in the third quarter we did see customers begin to get more comfortable in making decisions around Nortel than they were in the first half, and that we benefited from. We said earlier we saw 60% sequential growth in our OEM business of Nortel and you can imagine with chunk of. As it relates to our long-term relationship with Nortel, there's obviously some more work to do. Because as you know and as we said Nortel (inaudible) are trying to work through a product rationalization and obviously we want to be a positive part of all that, and that's still yet to be done. So I would say that the situation has improved. We're more optimistic than we were before but there is some more want to do as it relates to that relationship in that particular customer

Okay and then my last question and I will hop in queue. Can you just give a little more color on industrial automation I mean obviously the big end market for you guys and then we just didn’t hear much better, may be you can give a little more color on how that business performs sequentially and where you guys are seeing relative strength and weakness and sort of how you expect that sort of trend over the next couple of quarters would be (inaudible).

Well if you look in secured industrial automation company like (inaudible) even to a smaller extend of (inaudible) you can see that market is of significantly year-over-year and other than inventory correction I think being largely behind now, there is not a lot of real in-market improvement happening to (inaudible) industrial automation and we are seeing the same thing, but I would say this we saw sequential improvement in our industrial connective business in Germany as I think the German export machine builders are working through their inventory corrections so we saw some improvement there and our industrial networking business which really sort of bucks all the trends because of the substitution effect and because of the fact that we're now taking that technology beyond industrial automation, we saw some real nice performance sequentially in that business, and (inaudible) real well year-over-year. So you know the industrial business I think is year-over-year comparisons are still really tough, as I said in my earlier remarks until you see I think a couple of quarters of real good solid GDP growth, I don't think we'll see a lot increased investment in the area of the industrial markets and industrial automation which is to be expected people want to get out a good sense of the recovery is underway before they make significant CapEx investments in and that’s why we think that we need before need to see that before we are going to see any real significant recovery.

Your next question comes from Jeff Beach from Stifel Nicolaus.

First, you're shifting production this year from a number of Belden brand products into China. Where are you on that shift, and can you give us a sense of how much sales you'll do in China this year? I know that's kind of hard versus - I guess you can do last year of the market but I'd like to know kind of where the run rate is, where it could be if you finish this shift, and how much we might see at a run rate over what you've done this year to get a sense for cost savings maybe next year.

Yeah. Thank you, Jeff. This is Gray. I'm just going to remind everybody of what our sort of plan of record is with respect to the situation in Suzhou and the construction of that site the purchase of LTK and the fundamentals behind it. Again, we do at the purchase point about $60 million of Belden branded product across Asia. That is all imported from higher-cost locations, was most notably at the factories in Europe as well as the America. And we have calculated maybe a thousand basis point improvement that's available associate with the shifting of that production out of the U.S. and European locations into the Suzhou site. So that's sort of the basis for a lot of the rationalization and the justification associated with it expanded investment in China. So with respect to the current position, we've only done somewhere around 20% of that shift. So we still have about 80% in front of us, and we're gaining momentum, and it's nice that now that momentum is being conflicted by the fact that we have got a nice up tech in the LTK volume as well, so you can imagine when the order rates came back off of the inventory correction or the renewed demand creation for LTK and 30% sequential growth on the LTK brand, scramble through your priorities which is a great problem to have. So again Jeff, much of the improvement is still ahead of us, and again, we'll be moving as much of that production, it's a top priority for the regional team associated with the things that they need to accomplish here over the next several years, and again, much of the benefit is still ahead of us.

Can you give us a sense as to a time frame here or at what point a majority of this sales volume will be shifted?

Well, I would like to think we have it all done within the next two or three years.

Okay. This is a long process.

It is because of the complexity of the portfolio. The constructions that we're importing are highly complex constructions; and therefore, the time necessary to be able to make those transfers into the high quality are some time protracted.

Okay, a couple of other things. Can you talk a little bit more about your division in general, or even specific about your split and your enterprise between cat 5 and all - and you talked about the overall sales growing and we have seen a stabilization of sales in cat 5? Can you give us some color there?

Stabilization in sales in cat 5 is never expected. We expect a continuing decline in cat 5. We expect expansions in cat 6 and cat 6A, which again we saw this quarter. We do a fairly detailed analysis of those particular elements, and again those are global products, so it has regional organization as well but this was the first quarter. Last quarter, we got very close to shifting to have more of our enterprise business sitting on the high-end rather than the low-end. We are just below 50-50 in Q2 and Jeff, here in Q3, the split between the two, it's within less than a hundredth of a percent. So it's as close to 50-50, as 50-50 can be without being 50-50. So again we're seeing that transition to the high end as expected, it's a bandwidth game, and more bandwidth means more high end category cable to serve the applications in many enterprises and industrials require. So the shift continues and this is our first quarter where we hit 50-50.

And in terms of the pricing for the two different cat 5 and gigabit, I'm assuming cat 5 is one of the areas where you're really seeing on a significant competition; but can you talk about the current competitive environment?

Certainly on the low end of the data cable that’s always historically been the area where you've seen more competition, and we saw some of that in the third quarter, and we expect that will be with us at least in the fourth quarter and maybe in the first half of 2010. The other area that we see competition, Jeff, is in some of the more generic industrial cables. The products are more difficult to differentiate; and again, we saw pressure there. And the pressure comes really from two areas. One is smaller privately held smaller companies that are more cash flow focused, and then you got bigger companies that are just used to dealing with much lower margins, and I think, as their volume comes down, they're sort of scrambling to figure out how to fill up their factories. That's the area where we see the most price competition. Again, its completely independent of copper; and, not only for us, we took a lot of very, I think, appropriate actions, starting three years ago by getting our footprint in line, and so, from a cost point of view, we think we're in a better position than others, and we can deal with it.

Okay. The last question, can you just expand broadly on industrial cable and connector sales in Europe and distinguish maybe a little built between such as some of the industrial automation, industrial networking that's really aim at productivity versus cable and connector sales that maybe more related with general capital investment and not productivity and give us a sense there for what might be rebounding earlier in the cycle versus a little later.

Let me put industrial networking products aside for a moment, and let me just talk about traditional and industrial cable and connector business. Jeff, we haven't seen any signs of recovery in that yet. It's just as flat as can be. When we see any improvement it’s almost always tied to inventory correction. There's really just no signs of people spending more capital in the area of industrial segment, and it's really just very, very stable. On the industrial networking side, as we talked about before, which includes the industrial switches from Hirschmann but also the Belden Industrial Ethernet Cable we sell with it, that business has done well this year, as we expected, because people are using it at a higher rate than what we used to use with regards to proprietary systems. So that business is growing. It was up double digits sequentially. It's almost actually had organic growth year over year. So that business has done well. And we expect it to continue to do well because of the things we talk about, but also we're taking that technology now into new markets. We're taking it into infrastructure, alternative energy, transportation, and other rugged applications, like industrial, but not tied directly to industrial CapEx. And as a result of that we think that we are going to see good growth, again in Q4 we think people see good growth next year.

Again, back on the outside of the networking, just generally the other markets you serve with the industrial cable and connectors. Can you give us is there a sense even about how much is productivity just among the standard industrial products and connectors, what's productivity versus may project oriented capital expansion?

Jeff, I think what we're seeing now is that MRO spending in the industrial markets, I think, are now at normal levels. I think in the first half, people actually did some things with their MRO spending that they wouldn't normally do, but they had to do because they were so focused on cash, cash flow and covenants that they actually delayed MRO. I think the MRO is back and it sort of normal rate given the size of our economy. We are not seeing any significant improvement yet on large project business, and I don't think we will, Jeff until we get a couple of quarters of real GDP growth, and CEOs start to feel like they ought to be investing in capital, because they need more capacity. And until that happens, I don't think we're going to see a significant change in that business.

Jennifer, time for one more question, please.

Your next question comes from Dana Walker from Kalmar.

I have several if that's all right, Gray.

Okay. We'll make an exemption, Dana.

Well, you can always cut me off. In the way you described Trapeze with the non GAAP versus GAAP performance in Q3 was relatively similar, have you adjusted the way they contract so that the deferred revenue implications of the way they do business today is different than what the original book was?

We have made modifications to some of our contracts, and herein lies the curiosity. The accounting tools dictating you how want to conduct business with your customers, and it would be perfectly frank, we'd like more flexibility, right? On how we deal with individual circumstances with customers, as any supplier would prefer. The accounting rules around vendor specific objective (inaudible) Dana constrain you with respect and expect a normal distribution associated with those transactions. Therefore, your desire to have flexibility on how you deal with customers is contrary to establishing the SOE. Therein lies the disconnect of business desire and accounting desire. And, therefore, the change right away more commonsense approach if it's under EITF, 8-01, as common sense where judgment now comes back into the process is powerful from both dimensions. It's powerful from an accounting perspective, because no longer where we have to worry about the GAAP versus a pro forma result in business, and probably more importantly, it drives a lot more commonsense into your contractual relationships.

What if the SOE has lightened in its pressures on your business, aside from having the deferred revenue roll into your results in 2010, given if you've made modifications in the way you contract, what true implications does the VSOE evolution have?

Well the implication is just as I mentioned. The implications are more flexibility to call vendors in terms of how they construct their agreements with their customers if they so desire to establish this accounting capability not every company wishes to accomplish that. I think there are several customers that sort of enjoy not having the SOE. But in Belden's case it just gets in the way of us trying to explain what's going on in the Trapeze business. So again, the most important thing for us is the flexibility that it now allows us to with our relationships, which is what I think it's a fundamental business desire. So, it’s beneficial and that’s why we're so supportive of the change of way from the 97 to the SOE for Trapeze.

John, in what time frame would you expect your inventory to stop taking the leapfrog jumps that it's taken. I believe the inventory return number to take the leapfrog jumps that it's been taking?

No, it’s actually quite unusual for returns to improve when revenues fall. Usually it's exactly the opposite. Both companies are experiencing inventory return improvement as revenue increases because that helps us to makes it easier. The fact that we are doing as revenue comes down is very, very usual and quite remarkable but I think it has everything to do with the fact we're making significant traction on our lean initiatives. And if you in lean like I do you have to answer that it will never end, because we'll continue to make improvement. I think that if we get a tailwind again on revenue we would expect to get as markets recover in some ways our job becomes easier. So, I don't want to suggest that every year is going to be like this one, because I think we have an enormously positive thing, but I will tell you this. The things we're doing to deliver these kinds of results are real process changes in the way we run our business. Therefore we have a high degree of confidence that they stick. All of which is great in terms of the way we consider invested capital in the business and returns on invested capital. But unless your business is different there are operating profit, drag issues as your inventory return goes up, particularly when revenues are down.

Especially if you're a company that doesn't cuts your cost based on real demand but we are company that does.

Okay. A couple of last quickies. If Europe is making more progress sooner, why was their result and this might be a naive question. Why would they not be more pressured by the copper issue, and do we set new goals for Europe now that they've once again gotten back to 10% plus?

As a percentage of our total revenue, cable is actually quite a bit smaller in (inaudible) than it is in any other segment and so therefore effects that we have on copper. We had similar copper effects in Europe than we had in another segment. We are not nearly as material to the overall result of the segment and therefore they didn’t come with a topic point for today’s review. But they are there.

Do you set new targets for Europe?

No.

Have you gotten it 10% faster than you thought?

Well, I'm gratified that we got to the number sooner that we had originally set as a goal for ourselves. I think there might have been people who actually thought obtaining that level of profitability by Q4 was difficult if not possible. But as you can imagine, we're going to continue to try to improve our results, and we're not going to stay satisfied at our current level.

I presume though that a 15% is the corporate target, which, of course, is a corporate number after overhead, then for Europe to fully contribute to that number, it needs to get above 15% in time.

I would agree with already with you.

My final question would be this. What did you see that was either encouraging or not encouraging on the market capture initiatives that you have in place?

I think from a market share point of view the two highlights for me are that I thought we did a very good job in our industrial networking business, and I think we’re gaining real traction there, and I'm very, very really happy. The other thing that I'm really happy about right now is performance year over year and sequentially in our global account program. We're doing much better there than the company average. We are doing better than our served markets. It's clear to us that we're taking share; and for me, that was a real highlight.

I'll see you in December. Thank you.

Jennifer, thank you very much, and thank you very much for everybody, for your good questions this morning. If we didn't get to you, please give us a call this afternoon. Thanks, again, for joining us on the Belden earnings conference call. We sincerely appreciate your interest, and we'd be happy to entertain a call for follow-up questions. This concludes our call today, and thank you very much.

Thank you, ladies and gentlemen. This concludes our call for today. You may now disconnect from the call, and thank you for participating