Welcome to the MKS Instruments fourth quarter earnings conference call on the 4th of February 2010. Throughout today's recorded presentation, all participants will be in a listen-only mode. After the presentation there will be an opportunity to ask questions. (Operator Instructions). I will now hand the call over to Mr. Ron Weigner. Please go ahead, sir.

Good morning, everyone. I am Ron Weigner, Vice President of Financial and Treasurer and I'm joined this morning by Leo Berlinghieri, Chief Executive Officer and President and Seth Bagshaw, Vice President and Chief Financial Officer. Thank you for joining our earnings conference call. Yesterday after market close we released our financial results for the fourth quarter of 2009. You can access this release at our website www.mksinstruments.com. As a reminder, various remarks we may make about future expectations, plans and prospects for MKS constitute forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements, as a result of various important factors including those discussed in today's press release and in the company's most recent Annual Report on Form 10-K and most recent quarterly report on Form 10-Q, which are on file with the SEC. In addition to these forward-looking statements represent the company's expectations only as of today. While the company may elect to update these forward-looking statements, it specifically disclaims any obligation to do so. Any forward-looking statement should not be relied upon as representing the company's estimates or views as of any date subsequent to today. Now, I'll turn the call over to Leo.

Thanks, Ron. Good morning everyone and thank you for joining us on the call today. I'll give an overview of the fourth quarter and full year for 2009 as well as our outlook. Following me, Ron will review our financial results and guidance, and then we'll open the call for your questions. Looking at 2009, we started the year with two dramatically different halves. The first half of the year was extremely challenging due to the downturn in the overall economy and more specifically to our business. And therefore responded aggressively by making deep cost cuts and restructuring to reduce expenses. Even though revenue decreased 36% or $236 million, these reductions along with strict working capital management resulted in essentially maintaining a flat net cash position for the year and we were successful in minimizing our net loss to less than $3 million on a non-GAPP basis. Even though we took severe measures, we retained our capability for long term growth and continued our strategy of market diversification. In the second half of the year, we began to see rapid improvement in the business conditions which we expect to continue in 2010. I'm pleased to report that this recovery accelerated in the fourth quarter exceeding our expectations and bringing our fourth quarter sales to $149 million, up 41% over the third quarter of 2009. This improvement was driven by significantly higher shipments to our semiconductor customers, which were up by 60% and also to a recovery in non-semi markets, which increased 17% sequentially. Our non-GAAP net earnings benefited from higher margins resulting from higher volumes and a favorable product mix and were $0.31 a share. Our GAAP net income was $0.30 per share. The recovering semiconductor market is leading the present growth and we are benefiting from the design wins…

Thank you, Leo. In the fourth quarter, similar to the third quarter we achieved better performance than our original guidance for sales, operating results, and cash flow. Primarily as a result of strong demand from semiconductor OEMs as well as increased sales to other markets, fourth quarter revenue increased 41% sequentially to $149.3 million, we achieved non-GAAP earnings of $0.31 per share, which compared to our original guidance includes the benefit of higher gross margin due to increased volume of favorable product mix and a more normalized tax rate. GAAP net income for the fourth quarter was $0.30 a share. Our quarterly operating break-even for the fourth quarter increased to $110 million from $101 million in the third quarter. This quick increase in break-even was a result of our actions to eliminate mandatory time off, as well as most temporary cost reduction measures. Our cash position remained strong as we continue to focus on improving accounts receivable, day sales outstanding, improving inventory turns, minimizing capital spending, and controlling cost. Cash and short-term investments net of debt increased $9 million to $263.7 million. Day sales outstanding improved to 59 days and inventory turns improved to 2.9 turns. Capital expenditures for the quarter which were primarily for test and calibration equipment were $1.4 million and depreciation was $3.4 million. In the fourth quarter we recognized higher than expected shipments to semiconductor OEMs and increased business from customers in other markets such as light emitting diodes, gas analysis and medical. In the fourth quarter sales of semiconductor OEMs increase 73%, sales to fabs increased 23% and our sales to all other markets, which include solar increased 17%. Our solar business in the fourth quarter was $5.3 million and totaled $23.6 million for the year compared $49 million for 2008. Our 2010 backlog for…

(Operator Instructions). Our first question comes from Jim Covello from Goldman Sachs.

Question is really on the semi equipment side and the question is how much of a difference are you seeing in the activity levels at your various OEM customers, because one of the things I think is two big things I think people trying to wrestle with, one is, why some folks shipments are up much more in the first half of the year versus others. And the second is the sustainability of these levels of shipments. And so I guess really what we could ask you guys is, how much of a difference are you seeing in the activity levels from your various customers? Thank you.

Hi, Jim this is Leo, thanks for your question this morning. As of now we see no difference in the semiconductor side of the business from where it has been running for the last several months. It's hard to predict this industry, but we don't see anything significantly different in recent order patterns in semi.

Are you seeing different things from different customers, different OEM customers different activity levels or different growth levels from various OEM customers?

I would say that's true, but that also would reflect on their downside probably depleted inventory how much inventory. So it's hard to just [pin it], what's happening to their business some of it is recovering some of the drained inventory is down quite a bit.

Our next question comes from Krish Sankar from Banc of America Securities-Merrill Lynch.

Hi good morning this is Paul Thomas for Krish Sankar. Thanks for taking my questions. I guess, first off, congratulations on an excellent quarter and guidance. As with kind of along those lines, you were just talking about inventory, are we past the restocking phase yet or do you think that's going to continue in 2Q for semiconductor OEMs?

I think, I'm not going to predict when we get to the end point of inventory, but I would say this, certainly if you go back couple of quarters ago there weren't many systems on the OEM factory floors. So, and if you look today I'm sure you'd see that's different. So there has been a build up of that. However, if you ask the supply chain how they're doing getting device demands, I think you'll find that inventories are getting tighter on electronic components. So, there's some inventory build up and I think some of this drive in the global economy is having a high demand on some of the electronic components and I think there is more discussion around components that are tied on inventory than in excess. So I'd say there's been some inventory build-up that still seems like customers are streaming to get parts, we could imagine it's a challenge for everybody in this environment when you grow 40 plus percent after the downturn we've entered to be able to ship what everybody wants exactly when they want it. And I can tell you when it doesn't go out exactly when they want it they're calling you asking for it. So usually if inventory is built up you don't hear too much in that kind of situation.

Okay thanks for that. And then of course this is turns business, I know you don't need have a lot of visibility, but you've talked about growth through 2010 now. So looking into Q2, do you have any confidence directionally where that will go; you think that will continue to be up from where we were or where you're projecting we are going to go in 1Q?

Well, I think Paul you said it best, we have very little visibility being the turns business, but I do think that good reports in terms of the global economy expecting to increase we have good share now in non-semi business we keep growing that share, we've seen a down year and solar, which is supposed to get better. So I think the opportunity is there for the things that continue to grow, we'll have to see as we get into this quarter more.

Okay, one last quick one on the OpEx side, you gave guidance for 1Q, do you think this 28% of sales or so at the higher run rate now, is that going to be at good level with all the temporary cost measures backing, are we looking at like a $48 million to $50 million type of OpEx later in the year?

No, I think we guided to about just a little over $44 million in OpEx and our goal would be to keep that pretty steady throughout the year.

(Operator Instructions). Thank you. That appeared to be the last questions, please continue with any closing remarks.

Thank you. Well, thanks for joining us on the call this morning. Our core semiconductor market is recovering and we expect it to continue to grow in the future. With the global economy improving and our strong position in number of growing markets, MKS is well positioned and optimistic for increased growth in 2010. Thanks again.

This does conclude the MKS Instruments' fourth quarter earnings conference call. Thank you for participating. You may now disconnect.