Good day ladies and gentlemen and welcome to the Bruker Corporation's fourth quarter full year 2007 Earnings Call. My name is Gina and I'll be your coordinator for today. At this time all participants are in a listen-only mode. We will be facilitating a question-and-answer session towards the end of today's conference. (Operator Instruction). As a reminder this conference is being recorded for replay purposes. We'd now like to turn the presentation over to your host for today's call Bill Knight, Chief Financial Officer. Please proceed.

Thank you. Good morning and welcome to the Bruker Corporation fourth quarter 2007 financial results conference call. With me on today's call are Frank Laukien, the President and CEO and Brian Monahan, our Corporate Controller. During the call today, Frank will provide an overview of our results for the fourth quarter and full year ended December 31, 2007. I'll follow up with a more detailed discussion of our financial results, and then we will open up the line for any questions. Before getting started, I would like to read our Safe Harbor statement. This discussion will include forward-looking statements. These statements are based on current expectations, but are subject to risks and uncertainties that could cause actual results to differ materially from those projected, including but not limited to risks and uncertainties relating to the integration of businesses we have acquired or may acquire in the future, changing technologies, product development and market acceptance of our product. The cost in pricing of our products, manufacturing, competition, dependence on collaborative partners and key suppliers, capital spending and government funding policies, changes in governmental regulations, intellectual property rights, litigation, exposure to foreign currency fluctuations. And other risk factors discussed from time-to-time in our filings with the Securities and Exchange Commission. We expressly disclaim any intent or obligation to update any forward-looking statements other than as required by law. Just two days ago on Tuesday, February 26th, we closed and completed our acquisition of the Bruker BioSpin Group and the combined company was renamed Bruker Corporation. Our NASDAQ ticker symbol remained unchanged as BRKR. The financial information that we will discuss on the earnings call today does not include the results of the Bruker BioSpin Group yet. But only the financial results of the standalone Bruker BioSciences Corporation as it legally existed on…

Thank you, Bill, and good morning, everyone. We appreciate you joining us today. The old Bruker Bioscience's corporation as it legally existed at the end of 2007 had an excellent fourth quarter and a very solid full year 2007. We achieved very rapid currency adjusted top line growth with all three operating divisions delivering currency adjusted double digit growth for the full year 2007. In the fourth quarter of 2007 we had 26% organic revenue growth excluding currency affects. For the full year 2007, our organic revenue growth was 17%; while our currency adjusted revenue growth was 19%. The 19% included 2% growth from acquisitions. Even more importantly, several factors including our rapid top line growth, our continued operating margin expansion, and our decreasing effective tax rate, contributed to significantly improved bottom line performance year-over-year. Our net income in the fourth quarter of 2007 was $14 million or 13 pennies per diluted share, compared to net income of $9.7 million or nine pennies per diluted share in the fourth quarter of 2006. Included in GAAP net income for the fourth quarter of 2007 were after tax charges of $4.3 million or four pennies per diluted share for expenses related to acquisition of the Bruker BioSpin Group. Therefore, we had adjusted EPS of $0.17 in the fourth quarter of 2007, excluding the Bruker BioSpin Group acquisition charges. Net income for the full year 2007 was $31.5 million or $0.30 per diluted share compared to net income of $18.5 million or $0.18 per diluted share during 2006. Included in GAAP net income for the full year 2007 were after tax charges of $4.7 million or four pennies per diluted share for expenses related to the acquisition of the Bruker BioSpin Group. For comparison included in GAAP net income during 2006 were after tax charges of $5 million or five pennies per diluted share or expenses related to the acquisitions of Bruker Optics, which was completed on July 1st 2006. Also included in our net income for the full year 2007 was a one time $3.7 million tax benefit related to the revaluation of certain deferred tax assets and liabilities due to corporate income tax law changes in Germany, which Bill Knight will discuss in more detail later on. Overall, we made very good progress over the last three years at Bruker BioSciences, which included the operating divisions of Bruker AXS, Bruker Daltonics and Bruker Optics. With the addition of the Bruker BioSpin Group, the resulting Bruker Corporation further strengthened its leadership position in the scientific instrumentation market and is well positioned to continue to serve our customers with innovative higher performance products and solutions. We will provide an update on our 2008 financial goal by mid March when we expect to report the combined fourth quarter and full year 2007 financial results including the just acquired Bruker BioSpin Group. Now here is our CFO, Bill Knight again with a more in depth look at our Bruker BioSciences Corporation financial results.

Thank you Frank. As a reminder that the financial information being discussed on the call today does not include the results of the Bruker BioSpin Group, but only the financial results of the standalone Bruker BioSciences Corporation, as it legally existed on December 31, 2007. During the fourth quarter of 2007, our revenues grew by 35% or approximately 26% excluding foreign currency exchange rate tailwind. For the full year 2007, our revenues grew by 26%, which included approximately 2% from acquisitions, 7% from foreign exchange rate tailwind, and 17% organic growth. Again all three operating divisions delivered currency adjusted full year double-digit growth. Our gross profit margins remained steady in the fourth quarter year-over-year and for the full year 2007 were at 46.2% up 50 basis points from 45.7% in 2006. We continue to execute on a variety of gross margin improvement programs with a medium term goal of achieving greater than 50% gross profit margins. Operating margins for the year 2007 were at 9.1% up 210 basis points from 7% in 2006. Included in operating income for the years 2007 and 2006 were $4.7 million and $5.7 million respectively of acquisition related expenses. Excluding the acquisition related charges in each year, our operating margins improved by 170 basis points. While we continue to get volume leverage in our G&A and R&D expenses we have made deliberate additional investments in sales and marketing activities worldwide, which now contribute to our top line growth and which we also expect to begin level off as a percentage of revenue in 2008. During 2007, we incurred $16.8 million of income tax expense on pre-tax income of $48.6 million resulting in an effective tax rate of 34.5% compared to an effective tax rate of 46.3% in 2006. Included in our 2007 net income was…

Thank you. (Operator Instructions). And your first question is from the line of Derik DeBruin with UBS. Please proceed.

Hi, good morning.

Good morning Derik.

So I know you are going to provide a guidance update in March, but you made some initial comments about targeting 12% EBIT, 9% net margin, you are still comfortable with those initial targets?

I just would rather not comment on today's call Derik, but wait until we have basically our second earnings call, which will include the Bruker BioSpin results. This is not a comment that we are comfortable or not comfortable I simply would like to delay that call, it will make more sense then.

Okay. If you look at when you did the optics deal there subsequently your following that deal there was an offering to reduce the Laukien family holding. I know some investors are concerned there is potential going to be another such offering in the near term. Could you just talk about what's your plan are for that?

There are no plans, neither near term nor medium term plans. In fact there is also a lockup in the agreement. So longer term I think at this point the public ownership is approximately 31% in the combined Bruker Corporation. Longer term I believe that percentage will and should go up. That came go up in a number of different ways that does not have to be a follow on offering that also could be the use of our stock in potential additional acquisitions. None of which are planned right now either. So longer term we expect to be a more and more publicly owned company, short term and medium term there are no plans, there are no long term plans either for any follow on offerings or stock buybacks or similar. But that certainly wouldn't rule them out at some point in the future. But very unlikely that anything would be happening in the next two to three quarters.

Okay.

Nor am I suggesting will happen in four quarters, so there are no plans for anything like that. While I think overtime the public ownership percentage will and is expected and in my opinion should go up further.

Okay, great.

That's been our long term strategy ever since we took Daltonics public in 2000 and we are sticking to that.

Okay. Could you just talk about some of the overall market conditions? I know there is potential softening in Europe in particular but in the US. I guess can you talk about what you are seeing on how you are kind of feeling about the overall outlook?

Yeah, we don't really get complete picture of that until, I mean obviously in the fourth quarter it was excellent. Fourth quarter bookings were very strong. Going into 2008 we don't really get a complete picture of that until the first quarter is really over than we get data worldwide from all the divisions. At this point the feel of the market continues to be quite good in clinical research systems and in life science systems I have not even not even anecdotally so far detected any change in the market. In homeland security and defense, I don't know that those markets are dependant on the economy. I would not be surprised if things like semiconductor fab and metal foundries and some other more industrial analysis tools that later on in the year. I would expect that growth which had been very rapid for us in the recent years would slowdown a little bit, but so far I don't really have any statistics yet either that say okay that is slowing down. It's just looking at the macroeconomic environment, I think that would not be an unreasonable expectation that those parts of our business which are certainly much less than 20% of our business that they will have a slower growth rate compared to their very fast growth rate in the last few years.

Okay and could you give us a little bit more clarity on the I guess the breakdown of the combined company in terms of life sciences exposure, industrial exposure, bio-defense type of exposure and also a geographic breakdown of the combined company, in terms of total sales?

Okay approximately 45% of our sales tend to be in Europe, approximately depends on the division, 25% plus tends to be in the Americas may be more like 27%, 28% with a balance in Asia, Asia Pacific including Japan, including Australia, New Zealand, including India. So that gives you roughly the geographic breakdown. Obviously Asia has been growing as a percentage of that in recent years and I am sure also again in 2007. In terms of, the industrial markets depends on how one defines them. Industrial research is also much less dependent on the economy than say, metals production or cement production. But overall, industrial is certainly less than 20% and in this industrial it's actually about 10% or less than that. Not included in this industrial number are pharmaceutical and biotech industry, we don't consider those life science industries as part of the industrial revenue.

Right.

And generally, they run, biotech and pharma spending has its own [investing] proceeds as we all know, but it does not seem to be very much dependent on the economic cycle. We continue to have a very large academic and government sales which tend to hover around 50% of our revenue worldwide.

Great and just one final question Bill. I cut out for a minute on the call unfortunately. Did you mention what the cash was for the combined company and I guess what's it going to look like right now for the combined company and also the total debt for the combined company?

We didn't mention cash for the combined company. We did indicate that for this transaction we took on an additional $350 million of debt.

Okay.

The company Bruker Bioscience has about $72.9 million in cash as of December 31st.

Alright, thank you very much.

Okay.

So that cash information on the old Bruker Bioscience as of 12/31 is in our press release. It was in our press release and we will get into obviously also the combined balance sheet when we report the additional Bruker BioSpin Group financial, P&L, and combined balance sheet. And we expect that to happen in the next couple of weeks.

Your next question comes from the line of Steve Unger with Bear Stearn. Please proceed.

Hi, good morning. Just an overall question I would like to ask is just the quarter was very strong from a top line perspective and you guys didn’t necessarily dive into any details as to what was driving that. I'll leave it to you to may be just give us some highlights as to the top line strength in the quarter from the individual divisions. Could you go over that?

I will be glad to, Steve. It's been a very strong fourth quarter for all, three divisions. The one division that kind of had fairly different trends during the year was the Bruker Daltonics division, which had a slow start and then a strong third quarter and very, very strong fourth quarter. So, the other Bruker AXS and Bruker Optics had sort of steady strong year throughout the quarter were Daltonics had a very slow first half and then a very strong including a very, very strong fourth quarter.

And you ascribe that to, for Daltonics, which type of purchasing and which types of products?

In Daltonics, we had strength in the CBRN or NDC detection product particularly in the second half. We also had strength in our life science product that we sell directly. And we had a weakness in our OEM life science sales of [ion traps] to our major OEM partner in the year.

Okay. So that's Agilent, is that correct?

That is correct.

Okay and then I would like to understand what the senior management structure will be for the combined company going forward?

Very similar to what it has been before our Bruker BioSpin. The Bruker BioSpin Group has its own executive management team and senior management team that runs the company and will continue to run the company. Two individuals from Bruker BioSpin have been elected to our Board, Tony Keller the long time CEO, or my co-CEO at the Bruker BioSpin Group. As of now the Executive Chairman of the Bruker BioSpin Group has also been elected to the Board of BRKR the holding company of Bruker Corporation and Dirk Laukien who is co-CEO at Bruker BioSpin and is also running the Bruker Optics business has been elected to the BRKR Board. But there is a strong and experienced executive management team in place at Bruker BioSpin. In addition and Bill may be you can comment on that you have there is a new CFO for the Bruker BioSpin Group.

We have a very strong CFO in the Bruker X-ray division. He also will be CFO of the new Bruker BioSpin division. There is an existing very strong financial team at Bruker BioSpin. But as this is their first exposure to public company we wanted somebody sitting at the top that can help them with the public company responsibilities as far as reporting Sarbanes-Oxley that type of things. So we have I think a very seasoned financial team operationally that already exists and we now have a very seasoned CFO that will help with the transition to the public company environment for Bruker BioSpin.

Okay and then most of the management then is going to be distributed to the divisions. Is that what I should understand and that the corporate structure of Bruker Corporation will remain somewhat lien?

That is correct.

Okay and then lastly in terms of the deferred tax change. I think you mentioned that it was $3.7 million impact for the year for the German deferred tax change. I thought it was $2.4 million for the third quarter, was there $1.3 million impact in the fourth quarter?

Yeah. Steve this is Brian. $2.4 million was the benefit in the third quarter that you said $1.3 million benefited in the fourth quarter. So in total $3.7 million.

3.7 million. Got it, excellent, congratulations guys.

Thank you.

(Operator Instructions) and your next question comes from the line of John Sullivan with Leerink Swann. Please proceed.

Thanks hey guys good morning.

Hey John.

Just a couple of quick questions, regarding the strengthened Daltonics rank, I guess in the fourth quarter specifically can you just talk a little bit about LCMS instruments and the high end of LCMS. Is demand continuing for the high end of LCMS and are you seeing your products get adopted in to traditional small molecule sort of applications. I believe this was a hope for some of your highest end instruments.

That is correct John and increasingly so that is indeed the case. Of the life science direct sales growth at Bruker Daltonics most of that indeed came from small molecule applications, which would be our Electrospray TOF and the Electrospray Q-q-TOF type of instruments.

Okay. And are you getting feedback from customers that they are using these as a substitute for triple quadrupole instruments or what sort of feedback are you getting from customers and are they being used at all in regulatory applications to your knowledge?

Our systems are not used primarily or to a significant extent in regulatory applications. They are in the pharmaceutical industry that tends to be very much locked into triple quad protocol. But there are other opportunities from dosing to forensic toxicology, other screening applications, and food safety analysis and so on, where our instruments are now not broadly deployed, but because of there very high capabilities and their novel ability to look at basically on unlimited target list. That's rather than just a predefined MRM target list that you have in a conventional triple quad. They are now being deployed in institutions whether governmental or at universities or at companies that are developing methods and or writing publication. So I think we're on a good path there.

Okay.

I think overtime you will see that they will be replacing some of the conventional and more limited triple quadrupole technology. But I don't think we're in that real ramp up space yet. We hope to get there.

Sure. And then, can you just talk for a second about in the chemical detection business how far into opportunity with the Chinese FDA are you and was that a significant driver of business in the fourth quarter?

Bill, go ahead.

It was not a significant driver. That contract has been fully completed. There certainly is follow-on business as far as maintenance and support of those products for the next several years. But as far as actual unit installations that was completed in 2007?

Just for clarity this of course was under Bruker Optics, it was not part of the chemical detection or substance detection business or CBRN business of Daltonics, just as a clarification.

Right, my mistake. And then lastly was product safety testing in Asia a significant driver of your business in the fourth quarter?

I would say not yet.

Okay. Thanks very much.

Thank you, John.

That concludes the Q&A session. There are no other questions in queue I would like to turn it back to management for any closing statements.

Thank you very much again for joining us this morning. We will obviously issue a press release in the next couple of week about our follow-on conference call that will include the results of Bruker BioSpin Group that was just acquired two days ago. And again as we said earlier then we also hope to give you an outlook of our financial goals for the combined Bruker Corporation for the year 2008. Thank you very much again for joining and good bye.

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