Good day everyone and welcome to the IDEXX Laboratories first quarter 2008 earnings conference call. Just as a reminder today's conference is being recorded. Participating in the call this morning are Jonathan Ayers, Chief Executive Officer, Merilee Raines, Chief Financial Officer, and Jim Moraldi, Director of Investor Relations. IDEXX would like to preface the discussion with a caution regarding forward-looking statements. Listeners are reminded that statements that members of IDEXX management may make on this call regarding management's future expectations and plans and IDEXX's future prospects constitute forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. Such statements include but are not limited to, statements regarding management's expectations for financial results for future periods and the timing of new product introductions. Listeners are reminded that actual results could differ materially from management's expectations. Factors that could cause or contribute to such differences are described in Form 10-K for the year ending December 31, 2007 in the section captioned Risk Factors, which are on filed with the SEC and also available on IDEXX'S website www.Idexx.com. In addition, any forward-looking statements represent IDEXX'S estimates only as of today and should not be relied upon as representing the company's estimates of any subsequent date. The company disclaims any obligation to update or revise any forward-looking statements in the future even if its estimates or expectations change. Now at this time I would like to turn the conference over to Merilee Raines; please go ahead.

Good morning and thank you for joining us today. I will start off with a review of financials for the first quarter and our thoughts for the year. Jonathan Ayers will share with you an update on the business and we will then welcome your questions. As you have seen in our earnings press release today revenues for the quarter were $249.1 million; a year-to-year increase of 18% and diluted earnings per share were $0.43. Revenues though essentially in line with the street were slightly below our thinking at the time of our fourth quarter call in January. Earnings per share were favorably impacted $0.02 by a tax-related discrete item this quarter and negatively impacted $0.01 by acquisition-related discrete items in the first quarter of 2007. Adjusting for both of these impacts, earnings per share growth was 21%. Earnings excluding a discrete item were essentially on par with our thinking due to lower operating expenses and a somewhat more favorable growth margin as a percentage of revenues and a couple of pennies above street consensus. Before I provide further financial highlights I would like to let you know that we will be filing our 10-Q today; the first time we have done this filing concurrent with our earnings call. This accomplishment is the result of a focused coordinated effort between our finance team and businesses and we hope that providing more timely detailed and financial and business information will be of greater relevance and value to our investors. Now on to the first quarter P&L. The first quarter revenue growth of 18% included just under 5% from currency and just over 3.5% from acquisitions; so organic growth was 10%. The top compare created as a result of last year’s pet food recall negatively impacted year-to-year growth by about a point…

Okay thank you Merilee. We are very pleased with the first quarter as revenue finished close to our expectations clocking in at 18% year-over-year growth. In addition we achieved an impressive earnings per share growth of 21% on a non-GAAP adjusted basis resulting from careful management of the rest of the P&L and declining share count. As investors who follow us know we are first and foremost a company focused on driving growth and shareholder value by investing in and bringing innovation to our markets including our largest market, the veterinarian who provides health care to our canine and feline family members. Our historical investments in R&D which for example totaled $67 million last year have allowed us to launch a steady stream of new products and services. And in the first quarter of 2008 was not exception. The most important innovation achievement was the release and the first customer shipments of Catalyst Dx and SNAPshot Dx instruments. We are on schedule with a disciplined ramp for placements of these instruments over the year. Early customer feedback has been excellent and Catalyst Dx has the potential to create a paradigm shift in how lab work is performed in the veterinary practice. Catalyst Dx is so easy to run that it not only saves time versus other existing in-clinic chemistry platforms, it also provides a tech productivity advantage when compared to the time required to prepare the same for sending to the outside lab. And of course the lab work is available in eight minutes. The reference lab is able to conduct many tests that cannot be conducted in practice such as pathology and molecular diagnostics. And yet for core chemistry work nothing beats the convenience, speed and tech productivity of Catalyst Dx as part of the IDEXX VetLab in-house suite.…

Your first questions comes from Ryan Daniels - William Blair Ryan Daniels – William Blair: Congratulations on the great quarter. Merilee I wanted to ask you a quick guidance just to make sure I understand everything. First off on the revenue guidance, I know you took it up a little bit both on the low and high end, I’m just trying to figure out what was the primary driver there. I know you indicated that while within your range it was maybe towards the lower end in Q1 yet you’re still taking up your annual outlook. Is there anything specifically driving that?

Yes, the primary driver there is really I think the strength we’re seeing from currency. If you look at that and kind of [harken] back of what I had projected in January was that the impact of currency would be about 2% and now we’re thinking its going to be about 3% for the year. Ryan Daniels – William Blair: Okay and then on the EPS side if we kind of adjust for the tax change, it also looks like you’re taking up your earnings guidance a bit net net on an operating basis and you mentioned that the margins are going to be a little stronger there but it seems pretty similar to the margin profile you gave us in Q4, again is there anything in the works there that’s kind of taking up that operating EPS guidance or was it just a better start to the year?

Well the start of the year was pretty much in accordance with our thinking in terms of bottom line as I mentioned that we did have some upside from our thinking on gross margin and the operating expenses were a little bit lower and I think what we just are feeling Ryan is that we’ve got a pretty good handle on the ability to really monitor our costs and keep those in check and so think we’re just feeling like the business is solid and strong and all of that just is contributing $0.02 to $0.03 of upside for the rest of the year from operating performance. Offsetting that is the impact of the change in our thinking about the tax rate. Ryan Daniels – William Blair: Okay and then during the quarter you obviously, it looks like you expanded your revolver pretty significantly especially if we consider the accordion feature and I know you took up the share repurchase by another 2 million shares, are those two in tandem or maybe you’re getting more aggressive on the share repurchase or other uses of cash, are you seeing a little more activity in the M&A pipeline going forward that you might want to capitalize on, any color there would be helpful?

I think it was just normal prudence with regard to the balance sheet and financial capacity, the M&A pipeline and typically our business model is very modest. The bigger use of cash is the share repurchase program, we were looking at this and we’ve actually brought down the share count by about 3% per year since 2003 and if you look at the annual share price appreciation since the inception of the program in 1999 its been pretty good. I think it’s been a good investment and we continue to think that to be the case today. Ryan Daniels – William Blair: Okay and then any early commentary Jon from Catalyst in the field, it sounds like from all our channel checks demand and as you indicated remains very strong but I’m curious for the people you’ve placed it at, what the feedback has been early on about ease of use or service levels, any issues in the field et cetera, if you can give us more color on that that would be great.

As we expected we’ve been focused on every last feature, but just the thing that hits a customer is just how easy it is to run combined with the fact that there is absolutely no compromise in the capability of the instrument either in terms of menu or flexibility or accuracy. It’s just incredibly easy and of course it has additional capacity so if you’ve got a busy practice in the morning you don’t have to wait to add the second patient while the first one’s processing and if it’s a pre-anesthetic profile it could be just process both of them at the same time with no expanded time. So the ease of use really has been the paradigm shift I think for people. As with any instrument launch and totally expected in this case, you’ve always got early feedback with regard to software improvements that could be made and such and everything is really – and that kind of feedback is consistent with what we expected and part of disciplined ramp process. Ryan Daniels – William Blair: Okay great thanks a lot for all the color and congratulations again.

Your next question comes from Dawn Brock - JP Morgan

You saw some considerable strength in the rapid assays is there anything outside of the SNAP 4Dx test that’s driving some of that?

That’s certainly the largest offering product line in our SNAP offering but we have, I don’t know maybe close to eight or so other products in the companion animal business and one of them for example is the SNAP cPL which is a product that we launched last year for pancreatitis that’s getting a nice pickup and adoption. Its not a big factor in the overall because its just not – the 4Dx is such a big product for us and we have – it was good strength across the whole portfolio but the movement to full parasitic disease screening, I think that appreciation for the fact that tick borne diseases are prevalent. I know even the cover of one of the recent veterinary medical journals pictured ticks and anaplasmosis which is of course the fourth spot on SNAP 4Dx and it’s just in a good technology adoption cycle as I’ve mentioned.

Let me ask you this Jon are you seeing any sort of shift between maybe higher utilization of point-of-care tests against the diagnostic tests?

You mean point-of-care versus lab tests?

Exactly.

I think -- you know people have asked that question over time, I don’t see any particular shift one way or the other. In general parasitic disease screening is much more prevalently a point-of-care test. I think there’s value to providing that result to the client at the time of the wellness visit. But I don’t think there’s any particular shift one way or the other.

Okay I guess maybe sticking with the labs, the growth rate was definitely lower than what your annual guidance as you went through that, can you give us an idea of how much of the growth was associated with the new corporate contracts that came online in the fourth quarter?

We have an international lab business. I think it was a little over $250 million last year in total and I will tell you there are a lot of puts and takes. We have – offer lab services actually in 15 different countries around the world. Some are doing great and others a little disappointment. We have over 11,000 customers in North America and so I think it’s just there’s a lot of moving parts and I think it would be inappropriate to pick out any one part without looking at the other parts. So we really looked at the lab business as a whole and felt it was a good quarter.

Okay and just on the instrument side, you said that there were a handful in the first quarter and kind of gave us a little bit of an idea of how its going this quarter, let me ask you this. Are you seeing or how are you seeing the translation of previous VetLab Station placements, are you seeing any correlation between those prior placements and the ordering of Catalyst machines?

We actually had another very successful quarter in terms of placement of the IDEXX VetLab Station both to new customers of the IDEXX VetLab and to existing customers around the world who are upgrading to more information management and reporting capabilities that leverage their existing investment in IDEXX in-house instruments. That has just been a very, very successful program and it gives more value to the customer and therefore gives us very, very strong retention of our existing customers in the installed base and is a nice driver for growth. With regard to impact on Catalyst, we are very, very early days so I think – we have a ready base of customers who are very anxious to upgrade to Catalyst Dx who already have the VetLab Station. There will be probably customers who don’t have the IDEXX VetLab Station or don’t even have any IDEXX equipment that will be upgrading to IDEXX over the course of this year and future years and we really don’t believe that we are going to be demand-constrained in 2008 during our disciplined launch ramp process.

Okay and then Merilee accounts receivable was up a bit this quarter can you just elaborate on that. It looked like DSOs were up obviously as well. Can you just comment a little bit on that?

This is something that we typically see and I think if you were to look back at last year you would have seen receivables actually went up by an even greater amount. What we start to see here is that as we ramp into the tick season and start to see sales there that they’re tending to come later in the quarter and so you have the impact of the receivables are still there because they’re later in the quarter sales and so it just tends to drive the metric up. Overall I think that the receivables and DSO are really on track. I really don’t see anything out of line and anything and we aren’t seeing any weakness or having any concerns about the balances and any reflection on economy or customers’ ability to pay.

Okay that’s great and then just on working capital, that was up significantly as a use of cash in the quarter, anything that we should be aware of there?

Again, this is a very typical pattern for us. If you would look back over several first quarters what we tend to see is in addition to receivables going up, you’ll see payables coming down and that relates to things like tax payments, compensation payments from year-end, and so its just all very normal stuff for us and I think its something that we expect that working capital will – that piece will improve over the course of the year.

Okay just wanted to make sure we weren’t missing anything, thank you.

Your next question comes from Ross Taylor - CL King & Associates Ross Taylor - CL King & Associates: I have a couple of questions; the first one is as you all change to a new feline insulin product does that cause any challenges in terms of customer retention once you have the new product introduced?

The feline insulin product that we are working on, that we are seeking FDA approval on is specifically designed for cats and the clinical data would suggest that the transition from what has been a very highly popular existing product that we had on the market is quite smooth. Ross Taylor - CL King & Associates: Okay and can you say roughly when you anticipate the FDA approval for that product?

First half of next year. Ross Taylor - CL King & Associates: Okay, and second question Jonathan you mentioned during your remarks that you thought that even with the new Feline Triple test you’d keep the price on that unit constant and I just wondered what was the strategy behind that because I thought usually as you added more tests to the SNAP kits that you’ll raise the price a little bit and I just wondered what your thoughts were there?

Yes I think is a little bit different strategy Ross, and the strategy here is if you looked at what we did when we introduced actually 2Dx, that was a long time ago, and then we introduced 3Dx and then we introduced 4Dx, but particularly as we introduced 3Dx and 4Dx we kept the heartworm product on the market and when we introduced 4Dx we kept 3Dx on the market because it was a little bit different to these instruments and different geographies and then we went through a process of the significant amount of marketing investment to convince people to pay a little bit more to upgrade to the next product. In this case we’re taking a slightly different approach. Instead of taking additional marketing dollars to try to upgrade them, we’re saying we’re just going to keep the price the same. It is at the retail level, meaning at the level that the veterinary practice purchases from the distributor – about a $16.00 average unit price, and we want to give more value and because we’re able to give more value and because we are giving more value at the same price as I said for most market segments we’re just going to offer the Triple instead of the Combo. Ross Taylor - CL King & Associates: Okay and is there any chance that units could go up because of the addition of the heartworm onto the feline product?

That’s a great question, I think what we are going to find as people start snapping with Triple instead of Combo, which they will because that’s what they’ll get when they order it, and they are going to find heartworm. And we call it a tip of the iceberg philosophy which suggests is they realize that heartworm is more prevalent in the cat then they had any appreciation for that maybe they’ll start thinking a little more about heartworm management in the cat which would include maybe preventatives or more regular testing. It is not in our number. We don’t have any of that in our number but some people have speculated that that could change the protocol. Ross Taylor - CL King & Associates: Okay and Merilee Raines I missed some of the numbers that you gave out, could you go over again for me what you expect the tax rate to be for the balance of this year and also I think you gave out some numbers for the consumable component of the instrument and consumable line, I just wondered if you could give those again.

Sure, first of all with regard to the tax rate I said 31% for the full year and what we will see in the second through the fourth quarter is a rate of about 32%. And then for instrument consumables the organic growth rate was 5% and then when we adjust for changes in distributor inventories and for the impact of the pet food recall it was about 10% in the quarter. Ross Taylor - CL King & Associates: Okay and then did you give out an absolute dollar figure there or not?

Yes I did. It was $53.1 million. Ross Taylor - CL King & Associates: Okay, thank you.

Mr. Ayers there are no further questions; please go ahead with any closing remarks sir.

Thanks everybody for joining our call and again thank our employees for delivering a great quarter for us and we look forward to having our conversation with you all as our second quarter results come in, in July.