Good afternoon. My name is Patrick and I will be your conference operator today. At this time, I would like to welcome everyone to the Jabil 2010 Third Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. (Operator instructions) Thank you. Ms. Walters, you may begin you conference.

Thank you. Welcome to our third quarter of 2010 fiscal year call. Joining me on the call today are President and CEO Tim Main and Chief Financial Officer Forbes Alexander. This call is being recorded and will be posted for audio playback on the Jabil website jabil.com in the Investors section. The Q3 fiscal year 2010 press release and corresponding slides will also be posted there. In those slides you will find the financial information that we cover during this conference call as well as additional financial metrics and analysis that you may find helpful. You can follow our presentation with the slides that are posted on the website and begin with slide two now. During this conference call, we will be making forward-looking statements, including those regarding the anticipated outlook for our business, our currently expected fourth quarter of fiscal 2010 net revenue and earnings results, our long-term outlook for our Company, and improvements in the operational efficiencies and in our financial performance. Statements are based on current expectations, forecasts, and assumptions involving risks and uncertainties that could cause actual outcomes and results to differ materially. An extensive list of these risks and uncertainties are identified in our Annual Report on Form 10-K for the fiscal year ended August 31st, 2009; and subsequent reports on Form 10-Q and Form 8-K and our other Securities filings. Jabil disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Today’s call will begin with some comments and highlights from Forbes Alexander on our third fiscal quarter as well as some forward guidance on our fourth fiscal quarter. Tim Main will then have some macro environmental and Jabil specific comments about our performance, our model, and our current outlook before we open it up to questions from call attendees. I would now like to turn the call over to Forbes.

Thank you, Beth, good afternoon everyone. I now ask you to turn to slides three and four, our results for the third quarter of fiscal year 2010. On revenues of $3.5 billion, GAAP operating income was $96.5 million. This compares to a $7.8 million loss on revenue of $2.6 billion for the same period in the prior year. Core operating income, excluding amortization of intangibles, stock-based compensation, restructuring charges for the quarter was $132 million or 3.8% of revenue as compared to $29 million, or 1.1% for the same period in the prior year. Core earnings per diluted share were $0.40 as compared to $0.04 for the same period in the prior year. On a year-over-year basis for the quarter, revenue increased 32% while core operating net profits increased 355%. On a sequential basis, revenues have increased 15%. Our core operating income increased 38%. I now ask you to turn to slides five to eight as I comment on our revenues. The EMS dividend grew $256 million sequentially or 14% versus an expectation of 8%. Strong double-digit sequential growth across all but one sector and a return to growth in our telecom (inaudible). Revenue was $2.1 billion, representing approximately 61% total company revenue in the third quarter. Core operating income for the division was 5% of revenue. Our Consumer division represented approximately 33% of revenue or $1.15 billion in the third fiscal quarter; sequential increase of $118 million or 19% versus an expectation of 5%. Both the mobility sector and digital home office sectors producing strong double digit sequential growth. Core operating income for the division was 1% of revenue. Our Aftermarket Services division increased by 8% in the prior quarter to $211 million and represented approximately 6% of overall company revenues in the quarter. Core operating income for the…

Thank you, Forbes. I am going to depart a little bit from our typical conference call format and really spend a little bit more time talking about our business direction and what we are up to. If you turn to slide 15, just in terms of highlights, we are really entering now our second year of very robust recovery from our trough quarter and in fact if we look at the last 12 months, the last 12 months have been a record year. Last 12 months we’ve done $12.3 billion in revenue and recorded record core operating income of $400 million over that period. So, last 12 months have been pretty good. If we look at our sequential growth in healthcare, instrumentation, and industrial and a very rapid rebound in mobility on the previous quarter, we are very, very busy right now. New business pipeline and our ability to continue to grow the business, the combination of new business awards and gaining share of wallet with the existing customers and really making progress in targeted sectors has been very good. I think we are seeing some evidence of broader trends that we think will shape the industry for the next three to five years and we’ll talk a little bit about that in the next few slides and because of that and our position in our marketplace, we really believe that we are uniquely well-positioned for sustained growth and continued positive financial performance. Slide 16 please. With that in mind, I think it’s appropriate to just do a quick review of some of the tangible benefits we bring to bear on our customer relationships and what it actually is that we do for a living. I think it’s a much different value proposition today than it was 10 years ago…

Operator, we are ready to begin the question-and-answer period.

(Operator instructions) Your first question comes from the line of Steven Fox from CLSA. Steven Fox – CLSA: Hi, good afternoon. Tim, I appreciate all the direct comments regarding some of the labor and wage related issues that have been in the papers lately. I was wondering if I can get you to talk a little bit more about that in terms of what does it mean for your business longer term? You mentioned to start off with that businesses and usually very transient once a program is won, but what are the global advantages and maybe some disadvantages that play into your suite of offering maybe over next 12 to 24 months?

Right. You know, great question. First of all, cost escalation in China is really not a new thing and there will be – Yuan has been appreciating against the dollar for the last three, four years. And taxes have been going up. Wage rates have been going up continuously. Minimum wages were increased several times over the last couple of years. Now, having said all that, we have been paying folks in our China operations generally above the minimum wage. You know the cost escalation that we’ve seen recently removes the bit of the cushion but we think that impact to our business we see no labor strife, no demonstrations, no strikes, no other disruptions to our production. And we’ll deal with that on a basis as it comes up and presents itself to us, but we don’t expect any disruptions to our business. And we are very proud of the way we treat our people and the way we pay our people and work our people. So, we think we are in good shape there particularly relative to some of the practices of companies that are headquartered and based in that part of the world. Having said that, we think it makes heck of a lot of sense for Jabil to continue to maintain a global manufacturing footprint. We have a very competitive site in Penang, Malaysia, competitive site in Vietnam, competitive sites in India. And we have great sites in Eastern Europe and in Mexico. Continued escalation of cost particularly in China for a large scale production of big IT equipment, for example, will make operations in Mexico and Eastern Europe look a little bit better. And I think the decisions that OEMs will have to make about where a product gets built, how the supply chains come together is going to become more complex as the playing field goes through some fundamental changes. And I think we are at the end of one era here of go vertical big in one locational world and that’s China. And that’s the answer to your supply chain. I mean that’s been kind of the decade from 2000 and where we are today. That curve [ph] is inflated, it’s over. Everybody is in China. Everybody is where they need to be in the world. Nobody has got an advantage in terms of the labor cost or base cost. And now it’s, how effective you are in managing the supply chain, how effective you are at transparently running through the various manufacturing ops and then being execute and deliver on delivering products that will be manufactured in multiple plants around the world and how responsible you are – responsive you are in managing demand and supply chain networks. So we think it’s the beginning of a new era and that era will be more complex and play to the hands of companies that have sophisticated IT systems and a broad based global footprint. Steven Fox – CLSA: Great. Thanks very much.

Thanks.

And your next question comes from the line of Louis Miscioscia. Louis, your line is open. Louis Miscioscia – Collins Stewart: Okay, thank you. I am in an airport, so apologize for background noise that comes through. I guess, Tim, appreciate you know a good quarter. Let me start with that and appreciate the color on how the mix is changing. One thing obviously that obviously got $3.4 billion, $3.5 billion of revenues. You said about 10% to 15% incremental operating margin dollars in that incremental dollar. Do you have a new number for us? Obviously I can do the math on the information you gave, but just haven’t had the chance to do that yet.

Yes, we are really – the margin expansion we talked about for the last year was really from a trough quarter. So we are not really talking about margin expansion much anymore. We think 3.8%; we are in the zip code of where we expect it to be at this point in terms of revenue. We think we can continue to expand profitability longer term through portfolio management and leveraging SG&A expenses (inaudible) quarter to quarter it depends on the mix of our business. So no leverage metrics to track any more. Louis Miscioscia – Collins Stewart: Okay. Two question, they are big picture question. Aren’t you all concerned about Europe and wonder if you can comment if you saw any changes in demand in Europe and the – obviously a very strong quarter-to-quarter growth numbers that you gave for all the industries and those are helpful. Could you also help us out with how much you think is new wins and how much of that is organic? Thank you.

I can't help you much not because I wouldn’t like to but in terms of quarter to quarter we had a very robust recovery in mobility and that’s due to –due primarily to good demand, but also a broadening of our portfolio and the number of products that we build for a small set of customers in that sector. So that was important. We saw 12%, 13% sequential growth in the instrumentation and industrial and medical sector, which is a very strong growth, the second double digit sequential growth that we’ve seen in consecutive quarters. That’s all organic growth that existing customers’ share of wallet, new assemblies, all that kind of stuff. You know, the rest of it was just kind of a rising tide and organic growth. We are seeing more service adoption and the new business wins velocity is increasing. So, we feel pretty good about that. Louis Miscioscia – Collins Stewart: Okay. And then just on the macro environment that you are seeing – couple of other companies have making to do–?

So about – I think we believe that it’s about 30% to 31% of our production ends up in Europe is bound of Europe. So it’s based on European consumption. Right now we’ve seen very little change to forecast, very little impact. Not to say that we won't, I mean we always have to be cautious. But I think that the hysteria that was going around a couple of weeks ago is probably over blown I mean that the major economies in Europe that are may be struggling with (inaudible) are showing some growth (inaudible) countries like Greece and Spain and Portugal are very important. They are just not as big economies as France, Germany, U.K., Italy and the Scandinavian countries and it’ just –we think to put things in proportion, we are not seeing any kind of major disruptions in our business. Louis Miscioscia – Collins Stewart: Okay.

Getting a lot of background noise now, Lou.

And we move on to our next question. Our next question comes from the line of Amitabh Passi from UBS. Amitabh Passi – UBS: Hi, thank you. Can you hear me?

Yes. Yes we can. Amitabh Passi – UBS: Okay, thanks. First question just had to do with your sequential increase in inventories up $200 million plus. Just wondering if you can give us some color in terms of what the driving factors were again given the strength in mobility has a lot of that skewed to the dynamics in the mobility segment or is some of that sort of an anticipation of again the strong mobility growth that you expect to see in the August quarter, so incremental color around some of the inventory new build would be great.

No we are seven turns. You know our sales cycle is consistent with the previous quarter and so really what you are seeing here are heavier inventory investments and customers really mitigating the risk associated with those inventory investments with faster receivable collections and kind of on a very cautious basis. So we are able to manage our sales cycle in a period of a higher level of inventory investment. Having said that, we think inventory investment at this point is very – is a smart investment. It’s very little risk, it helps JABIL and our customers to optimize and capture as much revenue as they can while the demand is there. The material – the continuity of supply issues are still – are still there before the market. I mean component shortages are spreading across multiple industry sectors. We are still – it’s still very challenging to manage mix. And so we are hand and month in a number of areas. All the inventory is purchased through a customer purchase order so there is very little down side risk to it in terms of ownership. We have a demonstrated ability and a 90-day window to liquidate inventory. To the extent that business closed down, we’ll be able to liquidate that investment very rapidly, so it is not driven by any – you asked about mobility. It’s not driven by any particular industry segments. When I look at may be IT areas and higher mix segments of our mix, little bit slower inventory turns and the higher velocity parts of our business it’s always been true. But anywhere you see a higher mix business, we are carrying additional inventory and we think that’s a smart investment and we’ll continue to work, try to work that level back up to an eight turns and – but for right now we think it’s a very low risk investment for us. Amitabh Passi – UBS: Okay. And then just one other question for you. You know when you show your business breakdown now you kind of break out the mobility EMS segment versus the mobility technology services segment, which is part of Jabil Green Point. Again, just wondering as we look over the next quarter, the 25% growth in mobility, are you able to give us any sense as part of this pie growing faster than the other particularly in the August quarter?

Well, the assembly side of the business, the EMS side of mobility will grow faster. It’s a – you know you are talking about an electronic assembly with a much higher bill of material content than mechanical components. So that’s a higher revenue, lower margin, higher asset velocity business. And on the mechanical side, it tends to be higher margin, higher investment, actually pretty good velocity in terms of being a high volume low mix business but a higher fixed asset investment per dollar or revenue than what you see in the EMS assembly side of mobility. So, when we get burst [ph] in demand you’ll see the revenue grow higher in the EMS side than you will the mechanical side. Having said that, we are in a period of very strong expansion of our mechanics business and we continue to ramp production there and we’ll continue through the August quarter and into the November quarter. So, we are still very excited about the – what’s on the horizon for us there. Amitabh Passi – UBS: Okay. And then finally, do you have the precise percentages for your two 10% plus customers?

We don’t.

Not to hand.

We don’t think that we provide that other than on annual – on an annual basis. Amitabh Passi – UBS: Okay. Thanks.

Okay.

And our next question comes from the line of Wamsi Mohan from Banc of America. Wamsi Mohan – Banc of America: Thanks a lot. Tim, your investments in Green Point have truly driven some of the strength in you guidance here. Can you talk about perhaps the sustainability of the strength I mean sort of through the course of the next three or four quarters. And secondly where else outside of mobility are you currently leveraging Green Point? I think you’ve mentioned medical in the past. When should we start to start to expect a more material revenue contribution from those areas?

Yes so just why don’t you just kind of calibrate – the revenue growth is primarily driven by the EMS, the assembly side of mobility. And again, the mechanics part of mobility will be a lower revenue business. Having said that, we believe that we’ll continue to grow the mechanics business in mobility at a much more rapid rate than has happened over the last couple of years. And you asked a great question about fertilization [ph] into our healthcare business, potential areas of automotive and other sectors. And we believe that will take place but that’s a longer term prospect. So I – you really need to think about the contributions in other sectors of our business from Green Point in terms of – over the next couple of years, not over the next couple of quarters. Wamsi Mohan – Banc of America: Okay, thanks. And you alluded to this portfolio (inaudible) growing from 60-40 to 50-50 longer term. Clearly the 40 you are just translating to 50 is much higher mix, higher margin, including Green Point there. So, how should we think about the sort of operating margin given the op mix of revenues?

60:40 versus 50:50? Wamsi Mohan – Banc of America: Yes.

Yes, when it gets to 50:50, we’ll see. Wamsi Mohan – Banc of America: Alright, thanks a lot.

It’s – you know by my definition it should be better than 3.8 but there will be a lot of moving parts over the next few years. So we do think – really the point there is from here, now that we are at 22 going to 25% return on invested capital, we are right around a 4% operating margin. If not next quarter then certainly within a clear shot of where we are today. The question becomes is there – where do we go from here? How do we get additional margin expansion, better profitability in the business, and incrementally that will come from leveraging SG&A expenses and shifting our portfolio more towards those higher mix, lower volume segments, just a little bit more value-add rich. Wamsi Mohan – Banc of America: Great. Thanks a lot.

Okay.

And the next question comes from the line of Brian Alexander from Raymond James. Brian Alexander – Raymond James: Yes, may be to follow up on that last question in terms of that 50:50 long-term split you are expecting between traditional EMS and (inaudible) solutions for a lack of a better term relative to your longer term of 4% operating margins,. I guess the question are you expecting margins to expand on both sides of that pie chart or do you think there could be some degradation in one side of the pie chart that could offset some of the favorable mix because I guess to the last question, it would seem that your margins could actually get closer to five based on that longer term split. Thanks.

Right. Well, you know, I think it’s rational and reasonable to think that commodities – that the cycle of commoditization continues and I – we don’t expect a lot of margin erosion in the more mature sector, but they are definitely be more cost focused and efficiency focused. So, driving cost out of the system, lean manufacturing, more collaborative design, shifting the services from assembly and fulfillment to assembly, fulfillment, and aftermarket services and collaborative design and the other things that we can do as a business to add to our value proposition for customers there. I think it’s rational to think that as healthcare, life sciences, clean tech continue to grow in size and scale to our industry that there will be some commoditization there as well. So there should be some offsetting commoditization and margin erosion over long period of time. Having said that, if you really kind of do the math and think about tech [ph] correctly I think you are thinking the right way about it, I believe. If you are 3.8% to 4% today and you are able to continue to drive lean manufacturing to support mature segments, and you are able to rapidly grow these emerging sectors then we should be moving beyond 4%, closer to that 5% over time. Brian Alexander – Raymond James: Great. And then just back to the quarter you just reported, the revenue upside. You guys are pretty good at predicting revenue on quarterly basis and you just beat the high end of your guidance I think by $150 million in a demand environment that most would agree probably hasn’t improved a whole lot over the last couple of months. So, I know you have some larger programs ramping, may be talk about whether that mobility ramp, which it sounds like it isn’t, was well above your expectation, but as you go back to that and just how are you feeling about customer inventory levels in the context of the revenue upside you just experience in particularly the explosive growth you saw in industrial and networking. Thanks.

Right. Yes, those are great questions. You know we generally are better at forecasting our revenue. I think we did a – may be a – we didn’t do a very good job handicapping in a number of risk factors into our Q3 guidance. We were in a very tight material market, we still are, but very tight material market, a number of complex launches of mobility platforms that we weren’t sure how quickly they’d come out of the gates. And they did a little bit better than expected. And we just are winning more business than may be we have historically counted on. So I think all of those things combined really surprises a little bit on the revenue side. I think this time as we look at Q4, we always try and be a little bit conservative but we are trying to give you a pretty fair picture of where we think the revenue strength is and what the quarter is actually likely to turn out and trying to not handicapping as much of the risk factors and as maybe we did in the May quarter. Some good reasons for that, mobility platforms have launched, we kind of know where they are. We are doing a better job of managing the material constraints using tools that we have and demand, supply chain optimization. We are doing a better job of I think communicating what customers can expect from us in terms of throughput and therefore expectations in providing commitments to their customers. So, all of that leads us to a little bit more of a – little bit more confidence around the kind of sequential growth that we are forecasting for the August quarter. Brian Alexander – Raymond James: Great. Thank you and congrats again.

Okay.

And your next question comes from the line of Shawn Harrison from Longbow Research. Shawn Harrison – Longbow Research: Hi, Tim. Congrats on the quarter. First question, just with the mobility business. As we look at say into the August and November quarters, is there a potential upside to the EBIT margins we witnessed this quarter that 1%? Was it may be affected just by the additional depreciation being added and where can kind of those margins go within the consumer business for the next few quarters?

Yes, it’s a fair point. 1% is definitely not at a targeted margin. And I would expect that business on an annual basis to be in the 2.5% o to 3.5% range. And we are going through some – we are actually going through some costly ramps and a significant ramp of a costly program in the mechanical area of the business and launching a number of new programs still in the August quarter in the electronic assembly side. So that’s definitely lot of pressure on the margin side. I think by the time we get into the November quarter, I would expect much better margin performance from that part of the business. Shawn Harrison – Longbow Research: Okay. And then just as a follow-up on the capital spending within the mobility business. Do you think you will be down with kind of the large I guess capital program here within the August quarter or should we expect more in early fiscal ’11?

I think we’ll be done with the significant investment we talked about last quarter. Shawn Harrison – Longbow Research: Okay. And then the final question is I know when you announced the capital investment last quarter, there was the expectation that you’d expect to see other customers begin to take interest in the more mechanical side. I guess kind of what has been customer interest level or response so far?

We are not marketing it broadly right now. We are very, very into the launching the program that we are responsible for now and similar to the medical discussion we think that’s something we – I’d ask people to (inaudible) thinking about in terms of quarterly buckets [ph] and think a little bit longer term. We’ll be very busy with the ramp that we are going through right now through the August quarter. I think throughput and expectations will be much closer to where we wanted to be by the November quarter and really about early in calendar 2011 we’ll be able to may be sit back and look at hey, let’s approach other customers in other industry sectors to see if e can broaden the appeal of that investment. So, we are probably six to nine months away from being (inaudible). Shawn Harrison – Longbow Research: Okay. Thank you.

Okay.

And your next question comes from the line of William Stein from Credit Suisse. William Stein – Credit Suisse: Hi, thanks. I am wondering if you can comment, Tim, on lead times and shortages and perhaps relate that to inventory with (inaudible) anything to do with the inventory build on the quarter?

Yes, sure, we talked probably actually in a previous question that the supply constraints continue and really haven’t improved much from the February quarter. Kind of a same-same and it’s really gone into sectors like goods and even healthcare customers are seeing some issues in getting supplies. So that’s been difficult. So, look, I mean it’s – if we look at it, we think that an additional investment of – an additional investment in inventory right now is a smart bet for us. Again, it allows us do a better job of managing mix, it allows us to help customers capture revenue in the marketplace and it’s just too difficult to predict at this point day to day what’s going to show up and what we can ship. So – and demand is going up. So, it’s a very low risk way for us to hedge against component shortages. So it definitely has something to do with why we are seven turns and not eight or nine. William Stein – Credit Suisse: So, it sounds to me like this is not a matter of incomplete chips because you had a supplier who failed to deliver because of a shortage, it’s more of a strategic investment. Is that fair?

That’s fair. You know, it isn’t an incomplete kit on a single program customer because of a single device. Broadly speaking though, it is because people are fearful of incomplete kits and being lying down. So a more significant investment in inventory allows us to do a better job of managing mix. So people need to realize that I think it’s 70%, 80% of our output is still from lot quantities of 100 or less. May be it’s 200 or less; a very, very high mix business today. But it’s cost to manage a high mix business in an environment of material constraint. And I think if you look at people in our peer group, something like Flex probably turns inventory I am not sure what it is, but four or five times. I think they are running a business that’s kind of a proxy for what our instrumentation, industrial, and medical segment would look like and you know so it’s just it’s tough to get good inventory velocity even though revenue is going up in an environment where material constraints are so looking around every corner. So, it is a strategic investment. Customers are asking us to do that. We are responding with additional investments. The sales cycle has been expanding appreciably as many customers are mitigating the additional investment in inventory with accelerated accounts receivable payments. And we’ll continue to work closely with customers to mitigate our risk and yet allow them to capture as much revenue as they can. William Stein – Credit Suisse: That’s very helpful. One follow-up if I can. It looks like this new investment in Green Point in starting to pay off much – it seems much more quickly and successfully than kind of the first initial go you had in the components business a few years ago. Thinking longer term, are there other verticals that you might attempt to go into or other products that we might see coming out of Green Point in the next coming quarters?

No, I think we are pretty set in terms of where we think it’s smart for us to invest in vertical integration. Again, I think over time, the Materials Technology Services area of our business and that’s really an intentional new brand for that part of our business and it connotes the strategic intent to broaden the mechanical operations there into the healthcare industry, life sciences and other important parts of our business. So, that’s just, it’s more than just a label change for us. It does have meaning to it. It won't be meaningful to the overall business for the next – for another year or so. And we think that’s important. In terms of vertical integration, I think on a – one off, here and there joint venture to provide enclosures in a particularly difficult field [ph], localizing supply chains, for instance in India. When we first started building set top boxes in India, we invested in a present – in a current mechanical supplier to place in operation in India in order to localize the supply chain. So here and there we’ll find parts of the world where the supply base is inadequate locally and make investments to ensure ourselves of world-class supply. But other than that I don’t expect to see – you should expect us to make any additional big investments in vertical integration. William Stein – Credit Suisse: Helpful. Thanks very much.

Okay.

And your next question comes from the line of Jim Suva from Citi Financial. Jim Suva – Citi Financial: Thank you and congratulations. It looks like your mobility really at least if we look at the different segments of the Consumer segment growing 19 versus 5% and mobility of 20%, 23% I really think that was really the biggest upside and may be if you can just let me know if that is indeed correct and was that more from the growing of this new big CapEx program you put in or, Tim, I thought I heard you mention a few minutes earlier or ago that the materiality of that won't come for some future time period.

Jim, yes, Forbes. You are correct. Tim’s characterization there was these investments will start to bear fruit in the coming few quarters. The upsides here mobility were – as we talked about earlier, ramping some electronics production and that continues in this upcoming fourth quarter. And in some of our revenue guidance, we – perhaps we haven’t handicapped fully the nature of these ramps, the timing of these ramps. So we are very pleased with that, with the way those ramps are – occurred in the third quarter and how they continue in Q4. But, as I say, it’s principally electronics based. There is some contribution from mechanicals area. But that will start to bear fruit as we move forward here.

Yes, if anything we had margin headwinds from the mobility area because the growth in electronic assembly was much more robust than the mechanical side. And we are growing through the ramp process with that mechanical investment. So don’t expect that to be profitable during the ramp period. And so if anything, we had headwinds there. And I think it’s, we have overdrive, very good efficiencies in the rest of the business and deliver a 50 basis point improvement on operating margins. So we felt that was at least a pretty decent performance given the circumstances. Jim Suva – Citi Financial: Great. And that exactly lead me to my short follow up is if that’s the case, which I assumed it was, it seems hard to believe why 4% is the run rate, why the 4% operating margin shouldn’t be much higher when you are facing such – the ramps that you did and the large CapEx involvement and the ramping and the yield should improve that it seems like you know 4% should be kind of more the base line rather than the target goals and you know it was just a few years ago when you were consistently for multiple course setting 4.5% margin. So Forbes in 10 year kind of given a history overview for a good junk of this earnings call. May be you can talk about should we be looking at going back to 4.5% or why shouldn’t we be.

I don’t think there is any reason that what you are saying isn’t true. What you are saying probably is true. We just haven’t provided any guidance beyond the August quarter and we try not to back into that and I know people are going to struggle kind of what the heck am I going to put in my 2011 model now. Company is doing about $4 billion of revenue and – that implies at least $16 billion number in 2011 and what kind of operating margins like, yes, we’ll provide as much help as we can when we get to the September call. That’s what we can do right now. I mean I wouldn’t argue with you a lot. There is lots and lots of risk in the business. You know there is lots of things that can go up in the night. There is – you know there is still people say there is going to be double dip and we don’t see that. So – I think what we are saying is to say don’t ever expect us to go over 4%. It’s – this economic model works great where we are. I mean if we do 3.8% to 4% operating margins in the August quarter, we are going to drive 25% return on invested capital. I mean at that level of loan and a $16 billion 2011, we’ll drive almost $1 billion in EBITDA and probably drive 30% to 35% free cash flow after paying interest, dividends, and CapEx, and working capital consumption and everything else. So, yes, the margins can go beyond 4%, but where we are today is something that fundamentally is very sound. Jim Suva – Citi Financial: Thank you and congratulations to you and your team for a good quarter and great outlook.

Thanks, Jim.

And your next question comes from the line of Sean Hannan from Needham & Company. Sean Hannan – Needham & Company: Yes, good evening. So, I am going to keep it to one question that kind of multi-part. Jim, thanks a lot for the strategy comments. That was actually I think very useful. When you look at this space today and you talk about the pie growing, gaining share of wallet of you customers, you talked about as well some examples of increasing efforts around life cycle management, consultation, et cetera. Can you share some of your views on how this may make your relationships more sticky the importance of that in your approach and then when you look competitively, how do you expect others in the industry to execute on similar type of approach?

Great question. I mean it’s really all about making these relationships so fundamentally powerful and the group of companies so small, that we must be one of two or three manufacturing partners to the most attractive companies in the world. I mean that’s what it’s all about. And our ability to do that if we were just say, we could be the best circuit board assembler in the world or we are just going to provide commoditized service from low cost regions, we shut down more plants, we jettisoned more SG&A, we wouldn’t invest in design, we wouldn’t make the investments that we were making over the last 10, 15 years. You know we think the world is changing. Every seven, eight years, the world seems to change fundamentally in our industry and in 2001-2002 the world changed in the direction of Asia. And Asia will continue to be extremely important, but its’ importance will become less as the factory to the world and more as a consumption reasons and growing affluence and what does the rise of the rest of the world mean to the United States and North America and the more mature economies. So the world is going to change again. And it’s going to be very complex and the companies with the best IT systems, the best footprint, the best lean operations, the best systems to be able to connect all of the complexity around the world into something that’s understandable and simpler to manage, and has a very passionate, powerful culture of people that care like crazy about their customers, I mean those are the companies that are going to win. And we don’t think – we think there is really just a handful of companies out there that can provide that. Now customers want to have two or three suppliers in many cases and guess it will be big parts of the business that we don’t even touch. I mean we’ll never build a PC again. We’ll probably never build a notebook computer, but for anybody in the world with complex needs where the customer is providing software engineering, product design, any high mix requirements, regulated industries, those are the types of customers that we think we’ll be ideally suited for and we think that’s a big expanding market. And I think that it’s going to put folks that haven’t invested in systems and tools and don’t have a cohesive culture at risk and the companies that do have cohesive cultures and great systems and can make the investments I think will prosper. And there will be a number of companies in our industry that will do very, very well in that kind of environment. Sean Hannan – Needham & Company: That’s great. Thanks, Tim.

Thanks.

And your next question comes from the line of Sherri Scribner from Deutsche Bank. Sherri Scribner – Deutsche Bank: Hi, thanks. My questions have been answered. Thank you.

Okay. We move on to our next question, which is from Alex –

Operator, operator, this will have to be our last question please.

Okay. Thank you. This will be our question from Alex Blanton from Ingalls & Snyder. Alex Blanton – Ingalls & Snyder: Just made it. Thank you. Just quickly, the tax rate again for this year what you are expecting?

The core rate for the year will be 20% and for the fourth fiscal quarter also 20%. Alex Blanton – Ingalls & Snyder: 20% versus 32% on the year just ended right?

On a core basis it was also 20%. Alex Blanton – Ingalls & Snyder: Okay. Core basis is what we are talking about, right?

Yes. Alex Blanton – Ingalls & Snyder: Okay 20%. Thank you. Tim, you mentioned that the targeted growth sectors on slide 21, they are growing at 33% for you or for the industry?

For Jabil. Now that would – I don’t have the slide in front of me – well I think it was about $4.1 billion– Alex Blanton – Ingalls & Snyder: Yes.

(inaudible) and $3 billion in fiscal ’09. Alex Blanton – Ingalls & Snyder: Okay, so that’s –

So, that’s about a 33% growth rate year-over-year. Alex Blanton – Ingalls & Snyder: That’s the growth rate for the past year.

Yes. Alex Blanton – Ingalls & Snyder: And you said $200 billion to $300 billion total available market?

Yes. When you consider all of those industries combined, it’s several 100 billion dollars of addressable market. We think the penetration rate is relatively low. Alex Blanton – Ingalls & Snyder: Yes. Do you have any forecast or a statistics on that penetration rate? What is it do you think–?

It’s different in – for instance in healthcare and life sciences, it’s in the 15% range. Alex Blanton – Ingalls & Snyder: Yes.

In the industrial and instrumentation area, it’s probably 15% to 20% range. Alex Blanton – Ingalls & Snyder: Okay.

Aftermarket Services I am not sure what the outsource percent is but the significant opportunity there is that even the stuff that’s outsourced is outsourced in a very fragmented, disorganized way. So there is a tremendous opportunity for us to provide a more rational solution to customers even though it’s outsourced. There are very few big players that have dominated that industry. So, that’s a significant opportunity for us. Alex Blanton – Ingalls & Snyder: Okay. So the 200 and 300 includes aftermarket?

Yes. Alex Blanton – Ingalls & Snyder: Okay. And – I had one other one here. Listen, let me just ask you about Nokia. I don’t know if you can talk about that. But they pulled a lot of stuff back in house last year because they said we’ve got factories and we’re going to use them. What do you expect from Nokia going forward?

Our Nokia revenue is very small, now immaterial to our revenue stream. We went through that negative experience with Nokia back in 2007 and thankfully we are through that, going on three years now. Alex Blanton – Ingalls & Snyder: Okay. So that’s not in – you are not expecting much of a bump from them at all then?

No, I would love to do more business with business but strictly in the mechanics area. Alex Blanton – Ingalls & Snyder: Yes.

Because I tell you what, we avoid like the plague competing with big vertical customers internal factories if they are not strategically committed to outsource. Because you get it in any of these soft economic periods, and they pull stuff back inside. Alex Blanton – Ingalls & Snyder: Yes, okay.

For that, we avoid that. Alex Blanton – Ingalls & Snyder: One final thing. If I used the high end of your EPS guidance range for the next quarter and the mid range, mid-point of your sales guidance range, it implies about a $0.10 there. It’s the top end of your range, $0.50. It implies about 6% incremental margin on the additional sales to get there. Does that seem low to you, 6% incremental on – at this time or not?

Not given where we are today the mobility sector and particularly the electronics assembly sector is driving a lot of the growth in Q4. So there is margin headwind against us in terms of the Q4 guidance. I think we are really going to stop talking about, Alex, to the operating leverage side of it because we are in a range of performance now where we’d like investors to think about this is a good business that 3.8% to 4% operating margins if you just take what this company is going to do in fiscal Q4, Q1 and spin that out into fiscal ’11 it’s a $16 billion business that wants to run at 3.8% to 4% operating margin, that will produce $1 billion in EBITDA. That will produce free cash flow of 30%, 35% and you know that’s a good business. Alex Blanton – Ingalls & Snyder: Yes.

And so we’d ask people to stop thinking about that quarter to quarter at this point, you know they will be fluctuating from how much leverage there is. Alex Blanton – Ingalls & Snyder: Well, as long as you can get that kind of top line growth, you don’t need to leverage. Okay, thank you.

(inaudible) keep focused – thank you for saying that but (inaudible) absolutely stay focused on driving lean and efficiency and making the business more profitable. We think over the next three to five years that incremental profitability is going to come from SG&A expense leverage and what we can do to manage, get a better balance in our portfolio Alex Blanton – Ingalls & Snyder: Okay, thank you.

Okay.

And now, I would like to turn the call back over to the presenters for their closing remarks.

Okay, thank you, everyone. Thank you all our investors and analysts on the call today. We appreciate you joining us. And please feel free to call in for any other follow-up questions you have on the quarter. Thank you very much.

And this concludes today’s conference call. You may now disconnect.