Good day, everyone, and thank you for holding. Welcome to the Ceragon Networks Limited fourth quarter and full year 2009 results conference call. Today’s call is being recorded, and will be hosted by Mr. Ira Palti, President and CEO of Ceragon Networks; and, Mr. Tali Idan, CFO of Ceragon Networks. Today’s presentation will include forward-looking statements under the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause Ceragon’s actual results to be materially different from those expressed or implied by such statements. For additional information regarding the risks associated with Ceragon’s business, please refer to Ceragon’s annual report on Form 20-F and Ceragon’s report filed with the SEC. Web users can visit Ceragon at www.ceragon.com to read the complete forward-looking statement language. Since we have a lot of questionnaires on the call, we will ask you to limit yourself to one question. If we have time, we will hold one more round of questions. With that being said, I’ll now turn the call with Mr. Ira Palti, President and CEO of Ceragon. Please go ahead, sir.

Thank you for joining us today. With me on the call is Tali Idan, our CFO. We are very pleased with our Q4 results. We ended the year with an excellent quarter, and the order (inaudible) continues to be very strong. We are looking forward to substantial growth in 2010. To recap 2009, despite the global recession, underlying demand continued to grow based on subscriber growth and increased data usage. The most important trend in our industry was to have carriers looking to vendors like ourselves for network planning, design, and delivery with an eye towards migration to LTE-ready networks. The other side of the year was that due to the recession and weak currency, we saw customer hesitation and longer sales cycle, which hurt orders and poor visibility during the first half. Orders began to improve in the second half and have returned to a solid growth pattern. All of these resulted in only a 15% decline in revenue for the year. And by cleansing down on expenses, we achieved a net profit margin of close to 4%. Coming out of the year, we are aiming for new records for growth and profitability. Tali will give more details about the outlook. Assuming there are people on our call who are new to our story, I will take a moment to clarify where the market is now, and how we expect it to change before I get into specific comments about the quarter. Everyone seems to be focused on their call as an immediate paying point for mobile operators based on the projected growth in smart phone and other devices, all of these on top of worldwide subscriber growth. In addition, there’s a lot of media coverage of the backhaul opportunity inherent in the migration of mobile network stored LTE-ready…

Thank you, Ira. Good morning, everyone. Revenues in Q4 were $53.4 million, a 19% sequential improvement from Q3. This was still less than the $56.8 million we reported in Q4 of last year. But it presents a strong indication that we have resumed our growth trends. GAAP net income was $2.1 million or $0.06 per diluted share, excluding stock rates compensation, non-GAAP net income in Q4 was $3.4 million or $0.09 per diluted share. The geographic breakout of revenues appeared in the press release. As you can see in North America increase, Latin America was about the same, and APAC was lower, reflecting the timing of revenue recognition on turnkey projects. OEMs accounted for 15% of total revenues in Q4. In Nokia-Siemens networks, our OEM partner was again a 10% customer. We had two additional 10% customers in Q4. A large project in Africa, through a recent partner, and a leading Europe-based wireless operator. The non-GAAP gross margin in Q4 was 34.1% reflecting a favorable geographic mix of revenues. We believe that gross margin will likely return to around 32% during the first half of 2010. But we still have substantial revenue to recognize in turnkey projects in India. Non-GAAP operating expenses increased to $14.7 million as we added to headcounts the support future growth that Ira described. We generated about $2.5 million in operating cash flow in the quarter. And at the end of Q4, cash and cash investments totaled approximately $98 million after completing our share repurchase program during Q4. DSO remained at 115-days unchanged from Q3. Our inventory increased to $66 million, reflecting more turnkey projects in Q4 about 50% of inventory, represented products over the shift, but unrecognized its revenue. Our book-to-bill continues – our book-to-bill ratio continues to be well above one, but continues to grow as a result of more turnkey projects, which will convert to revenue regularly during the year. For Q1, we are guiding to revenues of $54 million to $58 million. Going forward, our aim continues to be improving operating margin and revenue growth continue. For 2010, our annual revenue target is 30% to 35% revenue growth, compared to 2009. Operating margin on a non-GAAP basis in 2009 was 3.4%. For 2010, our goal is to reach 5% to 7% operating margin for the year. Our long term operation margin target remain at 10%. Now we’ll be happy to take your calls.

(Operator Instructions) And once again in the interest of time, we'll be taking just one question. And first we go to Matt Robison with Wedbush Securities. Please go ahead. Matt Robison – Wedbush Securities: Hi, congratulations. You hit most of questions with your presentation. Just was curious if you could give us the shares you bought back, the headcounts, and the CapEx, and if you – when you would expect to see a few more US customers become material?

Well Tali is looking for the numbers on that. We are working very hard to acquire and work with additional US customers. This is a slow ongoing process. I think I indicated that the initial needs are being met mainly by fiber in the center of the cities. And the planning for the LTE-ready backhaul networks is an ongoing, but long term process. We are seeing more US customers already, but most of them at this point at very low volume. So I expect this to pick up probably maybe towards the end of the year or beginning of next year. Tali? Matt Robison – Wedbush Securities: It looks like a lot of the strengths came from Europe. You mentioned Hutchison and a business in Ireland and Western Europe, is that – should we – is that a one-quarter deal or can we look for that to continue?

The work with Hutchison is a global agreement and my expectation it’s more than a single quarter. Matt Robison – Wedbush Securities: And are the other customers picking up with some more dynamics?

Yes, yes, yes. I expect other customers can come. Tali?

Okay. Matt, let’s start with headcounts. Headcounts at the end of the year reached 508 employees. As far as CapEx, it was about $1.6 million in the quarter. But most of the share buy that we have done at the beginning of the year, we just complete it in Q4. So eventually, we did spend the entire $20 million, and we bought about – shy of 3.5 million shares. Matt Robison – Wedbush Securities: And so, you actually increased your headcount about 50 – about 10%, a little more than 10%, it looks like.

That’s correct. This is true. Mainly, we increased the headcount around people who support our turnkey projects in large quadrants in the APAC region. Matt Robison – Wedbush Securities: Expect that to – the headcount to continue increasing at that rate for a couple of quarters?

I’m not sure for that rate, but they will continue increasing in the next few quarters. Matt Robison – Wedbush Securities: Okay. Thanks. It's all yielded for.

Thank you, Matt.

And next from the line of Bill Choi from Jefferies. Bill Choi – Jefferies: Good morning. It looks like from where we see a lot of things went right for you, private networks came back. There was good geo diversity that helps margins. So I’m curious if you could talk about where you saw the upside to your plans? You had talked about revenues of $48 million to $52 million and gross margins around 30% to 32%. So in upside on both, if you could give the percentage of each. And you had talked about getting to about 10% operating margin target. Can you talk about when you would expect to see that sometime in perspective? Thanks.

Okay, Bill. I’ll take them one by one. I think that the strength, we saw both North America from one 10% customer, but additional customers as well. And we saw that also in Europe. The shift in geographic mixes, the largest contributor to the growth margins, which has always been – what we are saying both ways. And that’s why for example, we are guiding towards a little bit of a lower gross margin because we’ll recognize revenues – other revenues from India over the next few quarters. I see the strength is really in the markets coming back. It’s not just a specific one customer or one segment. It’s the market coming back and people starting in their investment cycle as they move forward. I think I answered those issues. You asked about the 10% operating margin? I think Tali guided the – that we are planning in June 2010 to reach a 5% to 7% operating margin for the year, which means if we move on a steady track, probably sometime in 2011, we’d probably see the 10%. Bill Choi – Jefferies: Okay. How many 10% customers did you have in the quarter? It sounds like you have at least two if not three, right? (inaudible) Nokia.

We had three 10% customers, one was Nokia-Siemens network, one was a large project in Africa for a resale partner, and one was a large wireless operator in the US. Bill Choi – Jefferies: And where was the strength from the private networks coming from?

Private network, we’re about 10% of revenues, which is quite normal for our business. Bill Choi – Jefferies: Was there any one single project or was it pretty well diversified there?

Pretty well diversified. Bill Choi – Jefferies: Okay. All right. Thanks.

Thank you, Bill.

And next from the line of Rozwadowski with Barclays Capital. Please go ahead. Amir Rozwadowski – Barclays Capital: Thank you very much, and good morning. How are you, Ira?

Good morning, Amir.

Ira, it seems as though booking trends are favorable, well for you folks, but the bill was well above one. When you come back to now decide to give full year guidance, you spoke on the improving business environment. What gives you the comfort at this juncture to give us a full year top line guidance. Is it more turnkey projects where your visibility has improved, general pick up in business, or how shall we think about that?

I think it’s both of the things that you mentioned, A, we have better visibility. And we had now three sequential quarters of book-to-bill above one, which means we started to build the backlog, which I think Tali indicated, as you can see, in our inventories and other off-turnkey projects, which will be converted to revenue during the year. And our feeling that with discussions with a lot of our customers in most of the regions. They are moving ahead. The hesitation and the issues that they had at the beginning of ’09, so most of them are over. Amir Rozwadowski – Barclays Capital: Okay. That’s helpful. Ira. And then if we look at the Asia Pacific region, you qualified the spending environment there, and that we shouldn’t really read into the fourth quarter. But if we look at India, certainly, it feels though we’re probably a little bit closer towards 3G licenses than we have been in the past? Of course, that has to be put in the context of new systems delays in the region. How shall we think about the opportunity once 3G licenses are issued there? Is that a significant build opportunity or have the carriers been prepping their backhaul networks in anticipation for 3G in some of the build?

I think that’s the second part of your question. Operators have been prepping out the network. For my network for the 3G – from my point – from our point – from our perspective, the 3G license were already given out in anyway because our people are prepping up for the 3G licenses and building the network. More than that, everything that they do today, they think of data and think of very large increase in backhaul capacity. So even in India where it's mainly 2G voice conversation is LTE-ready data of each network as of today. Amir Rozwadowski – Barclays Capital: Great. Thank you very much for the incremental color.

Thank you, Amir.

And next goes to Steve Ferranti with Stephens Incorporated. Please go ahead. Steve Ferranti – Stephens Incorporated: Hi. Good morning. Congratulations, great results, guys. Just a follow-up to the prior question, Ira, you mentioned that carriers in India – although traffic today is predominantly 2G and predominantly voice, they've all got data on their minds. To what extent are they looking at IP and Ethernet as a means of backhaul versus – it seems like most of the sales into that region have been SDH thus far.

Probably a more – really surprising over the last two quarters, if I look at sales into that region, we saw more IP than SDH. We saw less and less SDH, and a lot of it is high capacity IP with TDM capabilities, or they're using mainly the TDM capabilities, but the specs are full IP. And remember on that – from that – for full IP, you don't need to wait for LTE. Any new 3G deployments in India we're talking 3G, most of the base stations are already built to transfer the data traffic from the 3G into IP. For new base stations of 3G will also the IP extensively. Steve Ferranti – Stephens Incorporated: Okay, very helpful. Just one quick follow-up for me, just interested in some of the drivers in a – the demand you see from someone just – as a Hutchison – like a Hutchison for example. Is it pent up demand from their under-spending over the last three or four quarters? Is it driven by network expansion or capacity ads, just any sort of color you can provide in terms of what spurned these customers to now spend? And is Hutchison characteristic of a lot of customers that you're seeing out there?

Hutchison is and usually the leading customer and the leading indicator in a lot of the markets. And they are – mainly it's capacity ads. It's rebuilding the network. It's not incremental ads, but it's rebuilding the network to support much larger capacities mainly for data. Steve Ferranti – Stephens Incorporated: Okay, very helpful. Thanks.

Thank you.

And we'll go to the line of Daniel Meron with RBC Capital Markets. Please go ahead. Daniel Meron – RBC Capital Markets: Thanks, Ira and Tali. Congrats on the good execution on your part.

And certainly good (inaudible). Daniel Meron – RBC Capital Markets: Sure. The question on the extent of where you see fiber going right now versus microwave deployment in various regions in the world and how do you see that evolving as it gets close to 4G? And what's the timeframe that you expect on those related 4G deployments?

I think I mentioned the fiber mainly in the US market perspective. I think that one of the questions that we have been getting and a lot of people have been getting is, "Okay. What are the US operators doing right now with the data pressures that they have. Most of the data pressure that they have in the macros is in the inner city where they have a lot of fiber. So what they're advocating the backhaul networks using a lot of fiber in those regions where the data pressure exists, but not as strong in the more suburban area where the microwave is used or will replace copper in the future. I think what we'll see is the major cost differential between fiber and microwave, which plays in both ways. And where fiber exists, people will use fiber. Where fiber does not exist today, we'll see a lot of microwave usage. Daniel Meron – RBC Capital Markets: Okay. And then the timeframe where you think that we'll see those investments related to 4G really kick in and maybe as a different way, what is the percentage you think right now of your businesses related to relative subscriber growth versus data usage growth?

I think the easiest way to characterize it is if you take on North American business and your business is data-related, rest of world, it's subscriber growth. Now the easiest way to calculate it – yes differences in the different regions. We have customers in APEC which do – because of the data growth, I see business with them mainly in the Philippines and Australia. We have some because of subscriber growth in the US and Europe. But roughly, this is the large ballpark. Daniel Meron – RBC Capital Markets: Okay. Great. Thank you. Good luck.

Thank you, Daniel.

And we'll go to the line of Ilya Grozovsky with Morgan Joseph. Please go ahead. Ilya Grozovsky – Morgan Joseph: Hi, guys. Thanks.

Good morning, Ilya. Ilya Grozovsky – Morgan Joseph: Can you guys talk a little bit more about 10% customer in North America and how business is going there, and if you see that expanding? I know you guys have announced originally that you're in a couple of markets, give us an update there.

I'll be careful with the comments because the customer, we did a press release with them and in the press release they asked not to be named, so. We are working with that customer. That customer is expanding rapidly their backhaul network using wireless. We are in a few markets with them. And we work closely on their expansion and they've been a 10% customer this quarter. We're working very hard to try to make them a 10% customer in the next quarter after, nothing insured at this point. And you know me about this, usually I refer to those customers after I have orders delivered to talk about it, not before. Ilya Grozovsky – Morgan Joseph: Okay. Thank you.

Thank you.

We'll go to the line of Larry Harris with CL King. Please go ahead. Larry Harris – CL King: Yes. Good morning and congratulations on the results.

Thank you. Larry Harris – CL King: A little bit in terms of the competitive dynamic, I think at the outset of the call, you mentioned that Ericsson, Huawei, NEC were your major competitors, any comments on some of the other IP players like DragonWave or Harris Stratex against (inaudible), and any thoughts in terms of pricing trends in both TDM and IP type radios?

I'll start with the two – other competitors. We do see both of them in specific markets and specific niche markets. Some of the deals, I don't see them across the board. Depending on their strengths and strengths of their equipment, we see more competition from both of them in WiMAX projects versus in large carriers. Still, number one competitor is Ericsson, it's NEC, and it's Huawei as we move forward within the carriers worldwide. You asked a little bit about pricing trends. I think prices are not changing differently than prior years. I think what is happening, which is a similar trend to what has been happening. Although, if I look at our specific mix because we are now delivering complete to turnkey projects from the access all the way to the aggregation and the core, we see a mixture of solutions from mid capacity to high capacity, which changes our ESP a little bit throughout that mixture. Larry Harris – CL King: But overall, pricing trends fairly temper (inaudible) nothing to get excited about or anything like that – fairly stable?

Stable is not the right word, it's stable in the decline. The rate of decline is stable. Larry Harris – CL King: Understood that, okay. All right. Thank you very much.

By the way, like in any technology. Larry Harris – CL King: Absolutely. Thank you.

Thank you.

And we'll go to Matt Thornton with Avian Securities. Please go ahead. Matt Thornton – Avian Securities: Hi. Good morning, guys. Thanks for taking my question. A couple of quick questions, really more on the housekeeping side. Tali, I think you mentioned OEM partners were 15% of revenue. Is that correct?

Tali, you're on mute.

Yes, this is correct. Matt Thornton – Avian Securities: Okay, got you. And gross margins, on first half of the year 32%, is the thinking still that that should gradually improve towards the back half of the year as some of the other markets continue to come on?

Right. Geographical mix changes in our favor. We are assuming that it'll improve above the 30% range. Matt Thornton – Avian Securities: I'm sorry. Was that 30% or 32% for the first half of the year?

First half is around 32%. Matt Thornton – Avian Securities: Thirty-two percent, okay, got you. Perfect. All right. And just to confirm, I think you mentioned this, on the inventory, 50% was already shipped and it's just not recognized. Is that correct?

This is correct, yes. Matt Thornton – Avian Securities: Okay. That's perfect. And I just have a couple of other housekeeping items. I know you had said it's closed, the IP versus SDH/SONET and the percentage of sales from new platforms, any update there?

Yes. The IP platform this quarter was about two-thirds of revenues. And as far as the new platform, it was around 60% at the end of the previous quarter. Matt Thornton – Avian Securities: And in terms of 2010, how shall we think about currency impact, number one. I know, Tali, we talked about this. You guys are getting ready to re-establish a new hedging program for the year. How should we think about aspects in 2010? And I guess how should we think about tax rates? Are we still in that 5% to 10% range?

Yes. As far tax rates, I'm still assuming it will in the range of 5% to 10% of taxable income. Currency impact, it's very difficult to prove it of course. As far as our expenses, and we have big chunks of expenses in Israeli shekel. We have had every single front. So don't expect on this front changes or any movement. But the rest, depends. Most of our revenues are in dollars. In some cases, we sell in Europe, so that can be (inaudible). And then we have some other local currencies, but usually they have a small impact. Matt Thornton – Avian Securities: All right. That's very helpful. Thanks, guys. And congrats on the quarter.

Thank you.

Your next question is from the line James Faucette with PacificCrest. Please go ahead. James Faucette – PacificCrest: Thank you very much. I just wanted to ask, Ira, you made some distinction as to what was driving your opportunities in business in western – I'm sorry, in the US versus other markets, and that you said the US seems to data-driven. What about Western Europe? What's compelling the business improvement there? And can you give a little insight as to what kinds of situations carriers in Western Europe are you addressing right now? Is it anticipatory build or are they really scrambling to relieve pressure that's already there on the network?

I think that I characterized both Western Europe and the US, which are data-driven. I think we see in both markets – both the trends that you're seeing are really – some of it is preparatory actions and some of it is really scrambling to meet the data needs. But people I think – when you look at operators, operators usually plan, and especially the European and the US authorities plan long term. And what we are seeing is really upgrading of the networks based on existing data trends and more expectations moving forward. James Faucette – PacificCrest: Great. And then, on the competitive front, it seems to be that you guys have an obvious strong advantage in differentiation and the upgrade path that you can offer for the customers. What's your belief and understanding of where some of your larger competitors, like Ericsson or Huawei or NEC, are in developing and being able to offer IP native transport capability? And how do you expect their products to develop over the next one to two years?

If I see both Ericsson and Huawei might – if they are – I should say, from the offering stage, they are on par with us, maybe they're a little bit delayed in being able to deliver to the customers. But remember, those are very large operators and it's enough that they say, "Okay. They'll have this on the roadmap in X number of months," which allows them to win or compete for the business. And I think they are developing very rapidly. NEC is a little bit – from what we see, a little bit slower, although I expect them some time during this year and the beginning of next year to come up with their own solutions as well. James Faucette – PacificCrest: Okay. Great. Thanks very much.

Thank you.

Our next question's from Scott Zero [ph] with Merriman Curhan Ford. Please go ahead. Scott Zero your line is open. Scott Zero – Merriman Curhan Ford: Oh sorry. Good morning.

Good morning. Scott Zero – Merriman Curhan Ford: Hey, tell me – a quick question on the OpEx funding gross margins. It's a big step up in terms of cost this quarter. Will that increase sequentially as we go into the first half? And on the gross margin front, just a clarification, you indicated 32% in the first half. Do you expect that thing in the second half or really to be determined depending on how the next issue shake out?

It's really to be determined based on the geographical mix as (inaudible). But we are optimistic. Let's put it this way. And as far as the expenses, yes, we do expect that the operating expenses will continue to grow. But our goal is to make sure that they grow in a lower rate than the revenue growth. So this is how we want to continually improve the operating margins. Scott Zero – Merriman Curhan Ford: And just lastly, in terms of the first quarter range of $54 million to $58 million, what do you are the biggest swing factors over the next couple of months? And nice quarter. Thank you.

If I look at the swing factors, it's usually like any quarter. We have backlog, which we'll need to convert into revenue. We need to get acceptances on projects, which sometimes will fall in the quarter, some of them delayed. And we need to this – part of the quarter, which is we still need to book and bring in so it gives us some range of what we expect the quarter to fall in. Scott Zero – Merriman Curhan Ford: Thank you.

Thanks.

And we have a question from the line Aalok Shah with D.A. Davidson. Please go ahead. Aalok Shah – D.A. Davidson: Good morning, Ira and Tali. Just a quick question on India, can you give me – I know you've seen some pretty good revenue in your (inaudible) revenue in the upcoming quarters. But is there any sense of how you think the 3G rollout in India will impact you guys? And I know the timing of that has been good, but maybe you can give us an update on India.

From my perspective, 3G in India, priced as if we're almost issued already because anyone of the operators that we work with or most of them already think in the terms of 3G deployments. So they're building their backhaul networks to support 3G on the same network. And my expectation when the licenses are out, I won't a see a jump. On the other hand, I don't think that any delay in picturing lightness or see a slow down. Aalok Shah – D.A. Davidson: So Ira, in that sense, does that mean that we will see more orders – purchase orders coming for you guys in that geography and maybe into other geographies based on – for the rollout of 3G? Has most of the work already been done on the India front?

No, in the India front, the work has not already been done. I see we expect to see the same level of orders for quite a while now – for quite a while moving forward. Most people rollout their networks. Aalok Shah – D.A. Davidson: Okay. Great. Thank you very much.

Thank you.

And Mr. Palti, I'll turn it back to you for any closing comments.

I'd like to thank everyone for participating on the call today and asking all the good questions. And I hope to see each and everyone of you face to face over the next few weeks, and talk to you on the phone if you have further clarification of issues as we move forward. Thanks again for being with us. And we'll talk again. Thank you.

Ladies and gentlemen, that does conclude your conference for today. Thank you for your participation. You may now disconnect.