Good day ladies and gentlemen and thank you for standing by. Welcome to the Insteel Industries third quarter conference call. At this time all participants are in a listen-only mode. Later we will conduct the question-and-answer session and instructions will follow at that time. (Operator Instructions) As a reminder, this conference may be recorded. I would now like to introduce your host for today Mr. H. O. Woltz III, President and CEO. Sir, please go ahead.

Thank you, Karen. Good morning. Thank you for your interest in Insteel and welcome to our third quarter 2010 conference call which will be conducted by Mike Gazmarian our Vice President, CFO and Treasurer and me. Before we begin, let me remind you that some of the comments made in our presentation are considered to be forward-looking statements. Forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from those projected. These risk factors are described in our periodic filings with the SEC. I will turn it over to Mike to review our third quarter financial results and the most recent indicators for the macro drivers of our business and then follow up to comment more on the PC strand trade cases, market conditions and our business outlook.

Thank you H. As we reported earlier this morning, despite the continuation in severely depressed market conditions, Insteel [upholds] to the second consecutive quarter of earnings. Net earnings for the third quarter ended July 3rd, were $1.6 million or $0.09 a share compared with the net loss of $1.7 million or $0.10 a share for the same period last year. The prior loss for the quarter included a pre-tax charge of $2.9 million or $0.10 a share after tax for inventory write-downs to reduce the carrying value of inventory to the lower cost to market. Excluding these write-downs, last year’s results would have essentially been at a breakeven level. Insteel’s results for the third quarter were favorably impacted by higher shipments and spreads between selling prices and raw material costs and lower unit conversion costs. Net sales for the quarter increased 8.8% from the prior year driven by 8.5% increase in shipments and a 0.3% increase in average selling prices. On a sequential basis, net sales were up 18.3% from the second quarter of fiscal 2010. Q3 shipments rose 8% sequentially from Q2, reflective of the usual seasonal pick-up that we experienced between the quarters. However, even with the higher volume for the quarter, our Q3 shipments were still 40% under the peak level for the previous five years. Average selling prices for the third quarter rose 9.7% sequentially from Q2, due to the price increases that we implemented during the quarter to recover escalating raw material costs. Gross profit for the third quarter increased to $7.7 million from $6.2 million in the second quarter and $1.2 million in the prior year, while gross margins rose to 12.4% in net sales from 11.9% in the second quarter and 2.1% in net sales in the prior year. Gross profit in the…

Thank you, Mike. I want to focus my comments on results of the PC strand cases and expectations for market conditions over the next couple of quarters. Concerning the trade cases, we are pleased with the outcome which supports our contention, the Chinese PC strand competitors sprouted US trade laws in expanding the market presence to where they represented 92% of the imports entering the country in 2008 and 41% of apparent domestic consumption. We believe that combined anti-dumping and countervailing duties which range from 70.32% to 221.79% depending on producer, will be sufficient to offset the impact of the illegal benefits available to the Chinese, and that if they elect to compete in the US market going forward, it will be on a more leveled playing field. As we pointed out previously, the immediate impact of the cases on the domestic market and on Insteel will be minimal given the fact that the Chinese have been out of the US market the tendency of the cases. Longer term however, China's massive strand over capacity will likely be targeted at markets other than the US and the European Union which imposed duties on Chinese producers several quarters ago. While on the subject of imports, I should mention that imports of non-Chinese origin PC strand continued to enter the US market at elevated volumes relative to depress domestic demand with European producers representing slightly over half the volume, most likely due to weak conditions in their home markets. We will continue to monitor these trends. Let me turn my comments now to current market conditions and our outlook for demand over the next few quarters. As we discussed on our previous conference call, raw material costs had risen substantially since December 2009 and Insteel had initiated a series of price increases…

Certainly. (Operator Instructions) Alright, we do a question in queue from the line of Chris Haberlin of Davenport & Company. Chris Haberlin - Davenport & Company: I just wanted to see if you all could give some tax rate guidance for Q4 and then for fiscal ‘11, just given the kind of ups and downs you have seen in the past few quarters?

I don’t know that we’d be able to give any more specifics just due to the nature of the prominent book tax differences which have a disproportionate impact when our pre-tax earnings are at a lower level. If you go back to the prior years, when the pre-tax numbers was at a much higher level. We were pretty consistent in the 36 range, but I don’t know that I’d want to throw the range for Q4 or for next year at this point. Chris Haberlin - Davenport & Company: Okay. And then, can you just talk about what you are seeing on the wire rods supply side. I know that the supply had been tight in just kind of what you are seeing there. I think there’s the mills coming back.

The supply had been tight and we would attribute that mainly to the 2009 closure of two producing facilities, together with the simultaneously uptick in the automotive market. That seemed to be disproportionately strong, beginning in August or September of 2009 and actually running through the spring. We are seeing now that some of the automotive applications are seeing weaker demand and the wire rod market has loosened up some as a result. We also mentioned that there is the prospect for lower steel scrap prices going forward, so those things are having some effect on the market. Chris Haberlin - Davenport & Company: Okay. And then finally, can you just give us an idea of what's your geographic exposure kind of on a state-by-state basis? Are there any states that you are much more exposed to than others or is it pretty kind of consistent along the East Coast and South East?

No. If you look at our shipments where we are stronger in the states that use a high percentage of concrete and construction activities like Texas, like Florida, so I wouldn’t say that we are exposed to any particular state as much as I would say we are exposed to concrete construction.

Thank you. Our next question comes from the line of Robert Kelly of Sidoti.

A question on the trends, maybe into the end of your third fiscal quarter and a comment on how you are seeing the supply channel inventories there?

You mean the trends in the inventories in the third fiscal quarter?

About order trends at the end of the third quarter and what the channel inventory looks like.

I think, unit shipments have been reasonably close to expectations just on well off the pace of more normal markets, Bob.

Did they accelerate in the middle of the third quarter and trail off by June? You know that’s kind of what I’m looking for, were they balanced throughout the quarter?

I don’t think there was much volatility period-to-period within. Within the quarter we experienced the usual seasonal rise, but nothing beyond that.

How about your customers inventory position?

It’s hard to gather any objective evidence on it, Bob, but generally our customers are intensely aware of inventory levels and working to keep them in manageable ranges and I would tell you that just anecdotally we don’t detect out of balance conditions with our customers.

As far as the pricing action that you took, I mean when you talk about the fork, do you spread compression that the pressure is carrying over. Is that a function of your raw material costs rising and you are still trying to -- you are being behind the curve on price. The price increases that you try to institute just didn’t get through and are unlikely to.

I think it’s more the latter, Bob. The raw material prices did rise. We have been unsuccessful in fully recovering those in the marketplace despite, what I would tell you is a good effort and the realization that our competitors didn’t want to do that is a reality we’d have to deal with.

So, it’s the reverse kind of going on. You’ve seen scraps, scraps starting to drop-off and wire rod is expected to weaken a little bit. I mean how is your pricing trended in this environment towards the end of the quarter? Would you be able to hold the line on pricing like you have in the past?

It’s hard to tell. It’s sort of a day-to-day story, Bob, but we were pursuing price increases sufficient to recover our raw material costs up through probably the second half of June, and as we begin to see that the market wasn’t necessarily moving in that direction, we begin to reflect those commercial realities in the marketplace.

Can you just talk about the strand actions? Have you seen an increase in volume in that market as a result?

No. As I mentioned in my comments and as we have said on previous calls, the Chinese have basically been out of the market during the tendency of the trade actions, which is typically the way that these things work. We have also mentioned on a number of occasions that the strand market is a significant lagging market where customers generally had pretty significant backlogs and what we have seen over the last year is that customers have generally been liquidating those backlogs at rates that exceed their acquisition of new business. So, we have not seen any measurable impact of the trade cases on our shipments.

Thank you. Our next question comes from the line of John Kohler of Oppenheimer & Close John Kohler - Oppenheimer & Close: I was wondering if you could talk about maybe some areas that geographically are showing strength. I imagined Texas probably one compared to others.

Relative to more normal market conditions, I wouldn’t say that we are seeing strength in any geographies. I mean, I think you look and Florida and Texas, both of which are big consumers and construction is weak in both of those areas as it is up the East Coast. So, there is no particular geographic bright spot that I could point you to. John Kohler - Oppenheimer & Close: Okay. So, those two are the composition for a moment. If you look at it, do you see anyone that might be stressed in the environment where it might begin to reduce the capacity or is it still some ways away or not likely at all?

There is no real good visibility into that. I would tell you that conditions are difficult as we stated in the last call. Conditions are likely to remain difficult for a protracted period of time and just looking at the industry fundamentals, you would think certainly there some companies out there that are feeling the strings. But we don’t have enough good data on it to be able to answer the question definitively. John Kohler - Oppenheimer & Close: Okay. Well, you are in a great position with the balance sheet the way it is. If I could sort of get some more, I’d say color, but more background there. If you were looking at an acquisition, what type of hurdle rate are you looking to achieve if you see any out there, or how important is it for you in this environment with, it’s just so bleak to maintain the balance sheet in its current state?

Well, I think clearly that we would avoid taking any action that put us behind the ball with respect to financial flexibility. We have stated previously and it’s still the case that the growth opportunities that interest Insteel are in its core businesses and as you would expect that any acquisition would come with substantial synergies. I think that we have the financial flexibility to take the long view, but overtime, we are driven by cost of capital as our hurdle rate and I wouldn’t foresee that changing. John Kohler - Oppenheimer & Close: I mean you are doing a great job in a really horrid environment. So, thanks very much.

Thank you. (Operator Instructions) And I see no further questions in the queue at the moment.

Okay. Thank you for your participation and your interest in the company and we look forward to talking to you next quarter.

Ladies and gentlemen, thank you for participating in today's meeting. This does conclude the program. You may now disconnect. Everyone have a great day.