Welcome to the FactSet Research Systems second quarter fiscal 2009 quarterly earnings conference call. At this time all participants are in a listen-only mode. (Operator Instructions) Now I will turn the call over to Mr. Peter Walsh, Chief Financial Officer. Sir, you may begin.

Good morning everyone. Welcome to FactSet’s earnings conference call for the second quarter of fiscal 2009. Joining me are Phil Hadley, Chairman and CEO; Mike DiChristina, President and Chief Operating Officer; Scott Beyer, head of our non-U.S. operations; Kieran Kennedy, Director of Investment Banking and Mike Frankenfield, Director of our US Investment Management business. This conference call is being transcribed in real time by FactSet’s Call Street service and is being broadcast live via the Internet at www.factset.com. A replay of this call will also be available on our website. Our call will contain forward-looking statements reflecting management’s current expectations based on currently available information. Actual results may differ materially. More information about factors that could affect FactSet’s business and financial results can be found in FactSet’s filings with the SEC. Lastly, FactSet undertakes no obligation to publicly update any forward-looking statements as a result of new information, future events or otherwise. Today we will divide our time among three areas. First, I will review Q2 results. Then I will cover guidance for the upcoming third quarter. Finally, we will close by addressing your questions. Before we discuss the details of the second quarter it is valuable to touch on three areas we control that has our current focus. One, our market share. Even in a market that is contracting, share increases drive revenue growth. The fact that our ASV change was positive we believe indicates our market share is increasing. Two, reinvesting in our product suite. We estimate our opportunity is still more than ten times our current size even after adjusting for the market downturn. FactSet is operating from a position of strength because we ratcheted up our product investment before the market turmoil and have the financial flexibility to maintain it while the market resets. Please do…

(Operator Instructions) The first question comes from the line of Kevin Doherty - Banc of America Securities.

I guess just to kick things off; maybe based on some of the conversations you are having with your customers how are you thinking about the subscriber count relative to where it is at right now? Really I guess is there anything out there that suggests we shouldn’t see some of these sequential declines of 1,000 or 1,500 users maybe over the next few quarters?

I think what we do here is focus on what we can control and as Peter was describing the product line we have and where we are headed in the marketplace there are just awesome things for us to focus on. Our client opportunity when it comes to Marquis is quite positive and we have even though on a net basis you saw a net decline in clients and a net decline in users on the positive side we had lots of positive experience in the client base. From a marketplace perspective I don’t know what the future holds but I think it is important for us to just continue on what we see as opportunity.

Maybe just to follow that up if we are going to do some sensitivity analysis, when you do lose an existing user how much revenue is lost kind of relative to what you get from that marginal new users for a workstation? That $6,000? Also relative to kind of the company average ASV of about $16,000 per user per year. I’m just trying to get some sensitivity, not just the new customers you are not bringing on but when you are talking about an existing customer that would go away or existing user that would go away.

We are fortunate that we have a business model where the seat part of our revenue is significantly less than half of our total revenue so it certainly is not a one-to-one relationship between the percent of seat loss and our ASV subscriptions. The subscriptions vary dramatically client by client depending on how large the installations are. I think if you were to characterize this cycle versus the last cycle I don’t think anybody on this call would argue we are in a much more difficult environment than we were last time and as you can see I think as a business we are doing quite well in this part of the cycle.

Could you draw down a little more on some of your streamlining efforts? I know you mentioned a $10 million run rate right now. Did most of that really occur over the last couple of quarters? Where might that run rate go if you continue to execute some of those initiatives you talked about?

We started in the summer really focusing on how to make FactSet more efficient. The real positive story for us is that we started early. Achieving these operational efficiencies isn’t easy and it takes a companywide effort. Our program is really sponsored by a wide level of our operational management and it really touches all parts of the company. We haven’t executed on every idea that we have. We feel that we have easily captured $10 million in savings but we continue to press forward on it. We feel like it is a really important thing to accomplish because it funds our growth ideas even in this down market and also supports our operating margin. So we are fortunate that we have a well organized company that gives us the opportunity to execute on these items and also an experienced and committed management team to support it. We are doing it in such a fashion that doesn’t impact the quality of our service. We are very optimistic and positive about what we have accomplished so far but we still have work ahead of us.

The next question comes from Peter Appert – Piper Jaffray. Peter Appert – Piper Jaffray: Sort of a follow-up on the last one, in terms of the phasing of the $10 million in savings can you give us any color on that?

The $10 million in savings we have accomplished already as we enter into Q3. We continue to work on more savings initiatives as we press forward. Peter Appert – Piper Jaffray: So basically $5 million came out of costs in the first half and $5 million plus can come out in the second?

Correct. Peter Appert – Piper Jaffray: How aggressively are you going to pursue the buy backs? Do you step it up in the context of having so much cash and the market being so weak?

We look at our capital allocation process and I think it is important to first take a look at history. We have really had three things to focus on. Whether it be our share repurchase acquisitions or dividends. Since August of 2005 we have allocated about $160 million to acquisitions, averaging about $100 million on share repurchases and we are about $35 million a year on dividends. So we throttle one up or the other based on what is going to deliver the best accretion on a long-term basis to our shareholders. On the share buy back, the one thing when we look today is we know it is incredibly accretive because returns on cash are so meager. We have a very fortunate, high quality problem in that when you take our free cash flow generation the last 12 months and you add it to our existing cash balance we have about $275 million of capital to allocate. Of course, we need some cash to operate. That is definitely the basis, but it is still a significant amount and that is really what drove our decision to ask for a repurchase increase of $100 million. We will continue to allocate our capital to what we think is going to deliver the highest amount of EPS accretion and we will continue to look at not only share repurchase but acquisitions and our dividend is also something in our process currently today. Peter Appert – Piper Jaffray: Can you remind me what the price increase was? In terms of FactSet Fundamentals, maybe Phil you could just explain to us how you sell the product, how long you think it takes before the percentage of FactSet users that are using Fundamentals gets to be whatever the benchmark is, 50% of the customer base?

Maybe I will handle the first part of that question and then hand it over to Phil. The price increase impact on ASV this quarter was $7 million. A year ago it was $6 million. So the impact on price we are very positive that our pricing power held and was actually 16% higher than a year ago.

When it comes to FactSet Fundamentals I think you really want to talk about all the proprietary content on FactSet. Certainly, we are a vendor where we distribute lots of data from other suppliers on our system and we will always continue to do so. At the same time, the content team at FactSet’s focus is to produce the best content possible for each of our clients. We are obviously very early in the Fundamentals side of creating that product but as you can tell by Peter’s comments the early successes are very strong and it is above our expectations so far. As to predict exactly where it will go in our client base is probably something we openly won’t disclose but my view is that our proprietary content will continue to be very successful and a growth opportunity for us. Peter Appert – Piper Jaffray: Why does a customer take FactSet Fundamentals instead of Compustat?

I think you have to analyze the end user and what their particular needs are but you want to go through on a feature by feature basis. Both are standardized databases. One is a global database. One is a domestic database. The universe is substantially larger. I think we will be able to evolve the feature sets much quicker and much faster than we have been able to do on the SMP products. Some of that will depend on what features they make available to us in the future. I think it is a very competitive product today and we can see it by client transitions that have occurred already.

The next question comes from Jonathan Maietta - Needham & Company. Jonathan Maietta - Needham & Company: With regards to the expense savings I was wondering how should we think about it. Is a preponderance of that coming out of cost of services or is it kind of evenly spread between cost of services and SG&A?

The way we really operate in FactSet is really at the operating income line. I would say if I was going to weight the percentage a little bit heavier in the cost of services line but it is not something that has our focus. Jonathan Maietta - Needham & Company: With regard to taking market share does it feel like maybe you took a little bit more market share this quarter or do you not have the metrics to maybe talk to that level?

I would say anecdotal evidence would say yes. At the same time I would say it was probably a quarter where the market itself shrank.

The next question comes from John Neff - William Blair & Company, LLC. John Neff - William Blair & Company, LLC: International subscription volume was down sequentially while the U.S. grew. I was just wondering if you could speak to some of the dynamics you are seeing overseas?

I would largely be mirroring some of the comments Peter made earlier. I am not as enthusiastic as I would like to be about workstation growth and net new client growth but I would offset that with the share gains that I saw driven primarily by Marquis and secondarily FactSet Fundamentals if I could estimate. Also I think Peter touched on it as well, we were responsible for several of the wins in fixed income and our new short-term risk model within the portfolio with [our next suite] is proving rather positive right now. John Neff - William Blair & Company, LLC: This has never been a number you disclosed, and I’m not expecting you to necessarily do it now but I was wondering if you could possibly speak to the percentage of your subscription value that is coming from proprietary content you are offering today versus a year ago?

It is actually not even a number we have internally. I think the biggest challenge as a business is we generate value in two different forms. By integrating content sometimes it is ours and sometimes it is third-party. The second piece is the applications that bring that content to life and trying to split the value between the two makes it very challenging internally. I can tell you that it is a very positive trend but I couldn’t give you a specific number. If you were to compare that back to 2001 the answer would have been essentially zero to a substantial portion of our business at this point.

The next question comes from David Lewis - J.P. Morgan.

Would you be able to quantify the percentage of revenues coming from fixed income, content and analytics?

It would be a positive area of growth for us but still not significant enough to really, truly be a big driver in our business but it definitely is one we feel has a great opportunity in the future.

Can you talk a little bit more about the installation stats Peter mentioned? Were those in primarily overseas? I believe the opportunity there I guess initially is easier in terms of adoption overseas than the U.S.

Typically we take a look at the market need. The non-U.S. market place has a higher need for fixed income analytics than the U.S. market based on the way we currently sell our products. If you look at the successes of fixed income PA on FactSet it is really a global move. We had both domestically as well as international.

The underlying content sets, Estimates, Fundamentals thanks for the more details on that. Can you give us an indication of what those content sets are growing both proprietary and what is sold through your platform? On a normalized basis I guess today as well as what it was 2-3 years ago.

I don’t have those numbers for you and we don’t get down to disclosing product by product what our revenue grew. I think the only one that we really disclose at this point in a discrete way is the PA client MC count.

The [tiff] you cited on a revenue weighted basis, client retention was above 95%. It went down to 90% I believe this quarter. ASV is still above 95% but if clients barely budged I am just curious why is that down to 90%? What am I missing there?

The revenue weighted client retention remained above 95% is what I cited. So what we really did was we added a client retention that isn’t dollar weighted. That was the first time we disclosed that. We just wanted to add clarity given the current market conditions.

The next question comes from [Eric Rittener] - George Weiss Associates. [Eric Rittener] - George Weiss Associates: I just wanted to understand when we look at your U.S. and international revenues how much of those revenues are coming from fixed income clients versus equity clients? You mentioned that the fixed income is not really a driver of revenues, but what is that as a percentage of total revenues?

It is not something we disclose at this point. I think if you went back through history and look at the acquisition we made of Derivative Solutions you would get a feel for where it began. You can extrapolate from there. [Eric Rittener] - George Weiss Associates: But would you say this is not a driver of the total company, that the equity product is the primary product on the buy side?

As a percentage the total equity part of our business is substantially larger than the fixed income piece. As a growth area, the fixed income piece has got a higher growth trajectory than the equity side. [Eric Rittener] - George Weiss Associates: If I were to ask you the following because you have addressed this somewhat but you didn’t really quantify anything there, if you look at the U.S. and European base of equity products between market declines and withdrawals, the larger accounts or the larger clients are down between 40-60% which obviously affects their break-even and obviously affects their employment levels. Because your contracts have a delay vis-a-vis the decisions that have been made post-January, would you help us understand how you are thinking about the outlook for that business because clearly the performance is very, very good it is just it appears to be your clientele is under significant pressure and they are laying off quite a few decision markers at the portfolio level and at the research level.

I think if you look at our performance and you listen to the way Peter described the way our business model works I think it is a very important distinction for us relative to other players in the space and that distinction is that our client for the most part is to adjust the level of their service on a month to month basis. We are talking about results as of the end of February and beginning of March it is a real-time disclosure in what is going on in our client base. There is no lag effect. The fall impact that the market had on our client base is something that you see very much real-time in our revenue. Even the fact that the market started out pretty poorly in 2009 is reflected in our revenue to client base. I think if you compare that to other services clearly we are easier to adjust now. The positive side of that for us is several fold. One, when the market turns around and our clients adjust their services up faster on the positive because there is not a contractual obligation to the product. Second, from a business perspective I would much rather know what my revenues are and you as an investor would much rather know what my revenues are on a real-time basis, not some pretend contract that I might have a year or two out that is not really revenue because that client is no longer in existence. Three, I think as a company it is a better partnership with our clients. It requires us to be much more on our toes and deliver a higher level of service to our clients and in return I think it creates a much better bond between us and our users. So though you can see it allowed our clients to adjust their seat count down by 1,500 seats net this particular quarter, I really don’t view it as a negative to our business model. [Eric Rittener] - George Weiss Associates: You mention in your press release regarding the annual expense save. Excluding the U.S. dollar effects it looks like you lowered your expense base by $10 million. Can you help us understand what was the goal that you were trying to achieve and whether this helps you or limits you in your ability to ramp up when your clients come back and ask for more services?

I think the approach we took was a very objective one in just looking at all aspects of our business. I think when businesses are running well on a great economy you spend less of your time looking at expenses and your efficiencies and it is one of the fortunate side effects of a downturn. You really, truly analyze your expense base. I think we are very judicious in how we approached it and feel very comfortable the expense adjustments so far have no impact whatsoever on the service level we deliver to our clients and our future opportunities and in fact most importantly it allows us to continue to reinvest in areas we feel are growing. As you can see from our release our headcount is still growing and will continue to grow through the next 12 months. So as a business I think it is important for us to continue to always focus on delivering more value to our clients and that is our objective every day and ultimately that will serve us well.

I am showing no further questions at this time.

Thank you very much.