Good day everyone and welcome to this EnPro Industries’ First Quarter Earnings conference call. Today’s call is being recorded. At this time for opening remarks and introductions I would like to turn the call over to Mr. Don Washington. Please go ahead Sir.

Thank you and good morning everyone. Welcome to EnPro Industries Quarterly Earnings conference call. This morning we have got the pleasure of introducing you to Steve Macadam who has joined EnPro as President and CEO last month. I am sure you are all looking forward to hearing from Steve. And I will turn the call over to him in just a few minutes. He’ll be joined this morning by Bill Dries, Senior Vice President and CFO who will discuss our financials. In addition, we have got other members of the corporate staff here and present and prepared to participate in the Q & A session. Before Steve and Bill make their remarks and we open the lines for your questions I would like to remind you that you may hear statements during the course of this call that express a belief, expectation, or intention, as well as those that are not historical fact. These statements are forward-looking and involve a number of risks and uncertainties that may cause actual events and results to differ materially from such forward-looking statements. These risk and uncertainties are referenced in the Safe Harbor statement included in our press release and are described in more detail along with other risks and uncertainties in our filings with the SEC, including the Form 10-K for the year ended December 31, 2007. We do not undertake to update any forward-looking statement made on this conference call to reflect any change in management's expectations or any change in assumptions or circumstances on which such statements are based. This call is also being webcast on enproindustries.com. And a replay of the call will be available on the website shortly after it concludes. If you have any questions that aren't answered on the call this morning or if you have any follow-up questions, please feel free to contact me at 704-731-1527. With that I’ll turn the call over to Steve.

Thank you Don, and good morning to everyone. I am happy to be with you this morning. I want to begin by saying it is a priveledge to join EnPro. Obviously, the company has had tremendous success over the past six years which is a real testament to the sound strategies that the board and management team have established early on, as well as to the leadership of my predecessor Ernie Schaub, and also to the outstanding effort of our 4,700 employees around the world. Ernie put a lasting imprint on this company and prepared it very well for the future. I’m excited to step into the role he filled so well for so long. And I will certainly do my best to keep EnPro on a path that leads to continued improvement and even greater success. As you know I have been in the job for only a few weeks now, so I may not have all the answers to your questions, especially when it comes to my specific plans and potential changes to our futures strategic direction. I have begun an in depth assessment of our strategy and operations. But EnPro is a large, diverse, and spread out geographically. So it will take some time. However, I do want to assure you that I believe EnPro is in fine shape and that our strategies and operational capabilities are fundamentally sound. My first priority is to maintain our focus on the management practices and accreted growth strategies that have served the company so well to date. As I spend the next couple of months on my assessment my goal is to understand all the factors that will drive our future. By the time we release our second quarter earnings in August, I will have had a chance to develop…

Thanks Steve. As Steve said, we are pleased with the results of the first quarter and our double digit percentage increases in sales, segment income, and adjusted earnings. Sales increased by 4% compared to last year reaching $283 million. Five points of the 14 point increase came from favorable foreign exchange. The other nine points came from acquisitions and organic growth. Gross margins were 36.6%. The highest gross margin level we have ever achieved and an increase of 80 basis points over the first quarter of last year. Improvement was primarily a reflection of the performance of Fairbanks Morse Engine which benefited from higher parts sales and approved productivity. Our SG&A increased by 19%, largely reflecting the impact of the acquisitions and a stronger foreign currency. Asbestos related expenses declined by 6% due to the decrease in the non cash charge required to maintain our ten year estimate of reliability. Our operating income increased by 26% over last year so just under 25 million. Interest expense was about the same as a year ago, while interest income was down reflecting our lower cash balances. Other expense of $2.8 million related largely to cost associated with the proxy contest through the end of March. On this score we have incurred additional costs of about 1.5 million related to the proxy contest which will be reported in the second quarter. First quarter tax rate was essentially the same as last year at 37.2%. That all boils down to net income of $13.2 million, an earnings per share of $.61 per share or 9% higher than last year. Our earnings before asbestos and other selected expenses were $1.07 per share in 2008, 13% better than the first quarter of 2007. About half of the increase was related to foreign exchange. The share repurchase…

Thanks Bill. Before we open the lines to your questions I will wrap up our comments with some thoughts on our outlook for the second quarter and the balance of the year. The first quarter of 2008 got off to a good start and we expect year over year improvements to continue in the second quarter and through the remainder of 2008. Our operating cash flow should be sufficient to fund an increase in capital spending and additional share repurchases as well as any acquisitions we might complete. Total asbestos payments should decline compared to 2007 but we will collect about $20 million less in insurance so the net outlays for the full year will be closer to the levels we saw in 2006. Looking at sales and income, we anticipate the same sort of quarterly pattern in 2008 that we experience in 2007. We expect that sales will benefit from growth and volume as well as from the contribution of acquisitions and foreign exchange assuming that the dollar does not strengthen against the euro. As sales grow, segment profits should improve and profit margins should increase. We expect increased volumes to benefit income and earnings per share. Earnings per share will also benefit from the reduction in shares as a result of our share repurchases. In conclusion we are very well prepared for continued growth in 2008 although acknowledge there is certainly a great deal of economic uncertainty at the moment that could change our outlook. We are off to a good start for the year. Our markets are generally in good health. Our operations are performing well. We continue to generate cash which we will use to improve our returns to shareholders. Thanks for your attention. These next few minutes now we will open the lines for your questions.

Thank you. (Operator Instructions). We will go first to Todd Vencil at Davenport and Co. Todd Vencil – Davenport and Co.: Good morning guys. Nice quarter.

Morning. Todd Vencil – Davenport and Co.: Steve, welcome aboard.

Thank you. Todd Vencil – Davenport and Co.: You said at the outset that you did not feel like you have been around quite long enough to want to go into too much detail on the future strategic direction. So I am going to bug you about it. Typically with regard to what you said about your conversations with Don Defafit and I am just wondering if there is anything you can talk about with regard to where he may be leaning. I know Steel’s issues with the company were largely driven by strategic issues particularly with regard to the balance sheet. So any sort of comments on what he is likely to advocate.

Well, look. First of all Steel’s position has not been strategic. It is has been totally financial. I think Steel has been and I have also met with the Steel leadership as well and I think, quite frankly, they have been very complimentary along the core operations of the company, the strategic direction, what not. I think they would like the company, you know where they come from it is a hedge fund obviously and they are financial guys. They live in a high leveraged world. I think they would like the company to have a lot more leverage and be a lot more aggressive in the marketplace. Quite frankly, in today’s market with the economic uncertainty and the position of the company, we feel like it is prudent to have some dry power. The acquisitions that we have done – we have spent $210 million over the last few years in acquisitions which has been an absolutely fabulous use of our cash. Every one of them has been accretive and every one of them has been a very, very nice strategic fit for the business that has done the acquisitions. So we certainly believe at this point that the best way to create shareholder value is to continue to drive that growth both organically and through acquisitions. And I do not have any concerns at all about convincing our new board member that that is going to be the right way to grow. Todd Vencil – Davenport and Co.: Good. Any thoughts on the diesel engine business.

Well, I do not know the history. I only know – actually I am going up there in a couple of weeks as I am visiting all the businesses so I have just seen the numbers and heard folks here talk about it. I have met the guy that we have now running that business who has been there for a couple of years. I think he is doing a very, very nice job. I think we have improved the productivity, the cost position and the focus quite a bit in terms of running the basics of the plant. It is a tricky business because it has not got an unlimited market but it has got a nice after market stream of revenue and generates pretty decent returns, returns on investments at this point. So we have got to get kind of figured out whether it is – what the long-term future of the engine business is. But I am looking forward to visiting. We have got a very strong workforce up there and we run a really good plant. Todd Vencil – Davenport and Co.: Well, good. Thanks for that. Moving around to sort of more mundane financial issues. One of the things I am hearing from a lot of the companies that I am hearing from and that I follow they are all screaming about input costs. And you guys are not. So I guess I am just curious as to what you are seeing and it seems as though you are not having any trouble passing those through or offsetting with productivity but can you talk about what you are seeing and what may be noticeable to you on the input cost side.

Yeah. I’m going to let Bill address that. Todd Vencil – Davenport and Co.: Okay.

Todd, yes we have seen – there are certainly many of our commodities have seen price increases since the beginning of the year. Many of our businesses enter into pricing agreements the duration of which lasts anywhere between 6 to 18 months. So most of the recent run ups in a lot of the commodity prices have not directly impacted us as yet because we are covered under those contracts but as those contracts start to roll off in the second half of the year, early next year to the extent [inaudible] prices are still up there we will – those will be passed onto us and we will be looking to attempt to improve our productivity as well as eventually passing on price increases to our customers. Todd Vencil – Davenport and Co.: Can you tell me where you are primarily hedge and what – to what extent you are hedged, generally?

Well hedged through by virtue of having signed [inaudible] contracts. Again if you look at our commodity we are about half of our total cost of sales are raw materials. Steel is probably the single biggest in one shape, form or another. It probably accounts for 20 or 25% of that but it is a variety of different type shapes and types of steel. We also buy a fair amount of copper and bronze, PTFE, elastimers and by and large we have contracts covering – agreements covering most of the commodities. Todd Vencil – Davenport and Co.: Okay. Thanks for that. I will jump back in the queue.

Next we will move to Randy Laufman at Imperial Capital. Randy Laufman – Imperial Capital: Hi good morning guys.

Good morning Randy. Randy Laufman – Imperial Capital: Couple of questions. It sounds like, obviously, you are getting a lot of strength on the after market side across all your segments and it seems like that has been a big focus of recent acquisitions. Just wondering if you could talk about the strategy going forward as far as continuing to focus on aftermarket acquisitions as well as what the mix of business is looking like right now as aftermarket continues to go up? We may be steady to slightly down.

Well, I’ll let Bill comment with the specific numbers but my sense is that the OEM markets have only fallen – the demand has only dropped in specific segments in specific geographies. For instance, US commercial truck manufacturing is obviously off. US auto is off but when you look at OEM uses for expanded oil and gas facilities and in even in European auto and many of the regions around the world we are see strength in both the OEM business as well as the aftermarket business. And so one of the real benefits of this company, obviously is it is very well spread out geographically, industry and in use segment wise as well as aftermarket versus OEM. So I would not characterize it as we are seeing kind of widespread reduction in our OEM sales. I do not think – and because of that I would guess it has not moved the overall mix of the company enough to really register. Is that accurate?

Yes Steve, I agree with that. I think the needle has not moved that much. We are still roughly fifty fifty aftermarket OEM split. And the second part of your question as we have looked at and will continue to look at acquisitions going forward certainly the aftermarket content is an important consideration as we look at and evaluate. Randy Laufman – Imperial Capital: Okay great. Next question is on CPI. You mentioned there was some integration costs during the quarter. Do not know if you can quantify that Bill or also if you could talk about how long we may see some of those integration costs before it is kind of fully up and running?

I will not quantify the integration costs. Typically we would not quantify something like that. That was not the major driver in their performance. They had some market issues. As I mentioned during the course of the talk before, they had some market issues in their UK operations, a little bit of a shift and mix, along with these integration costs and some market issues up in their Canadian operations. So they are – they have fallen short of margin expectations but their markets overall are pretty strong globally and we are fairly optimistic that we will significant strengthening as the year goes on there.

Yes just to elaborate a little bit on the Canadian comment that Bill made. What happened was there was a proposed increase in royalties on new gas wells in Alberta and as a result of that drilling slowed. But that was kind of a January, February phenomena and so although that proposal has not been formally withdrawn, it has not gained any support so it has kind of been put on the back burner and the wells have really – in March really started to return to normal levels which we expect going forward. It was not a structural change in the Canadian demand is, I guess, the point I wanted to make. Randy Laufman – Imperial Capital: Okay great. Lastly just wanted to – couple of housekeeping items on the asbestos. Can you tell us what the 10-year liability was at quarter end as well as the available insurance and what was collected during the quarter?

Actually Rick Magee our General Counsel who manages the whole asbestos program is also here so I am going to let Rick address that.

Well, sure. Randy how are you doing? Randy Laufman – Imperial Capital: Good, thanks.

Good. Our estimate for the 10-year liability now is $511 million. That is a decrease from last quarter when it was $519 million so down by 8 million for the quarter. Our remaining insurance, the total amount of remaining solvent insurance that we expect to collect is now at, let us see, it is now at 382, I am sorry $369 million which is down from $382 million at the end of the year. So we collected $13 million and our liability declined by $8 million. Obviously the difference there, more than the difference there is the amount by which are liability went up because of the new quarter added to the liability which was $6.5 million this quarter. Randy Laufman – Imperial Capital: Great. Thanks a lot guys. Nice quarter.

(Operator Instructions). We will go next to Joe Mandelo [ph] at Fidelity and Company. Joe Mandelo – Fidelity and Company: Morning gentlemen.

Morning Joe. Joe Mandelo – Fidelity and Company: First off just about the acquisitions that you acquired recently. I know you do not want to quantify how much they contributed to sales but could you give us a sense just how significant it did add? I know you said acquisitions and organic growth attributed to 9% on the quarter but could you just give a sense of maybe how much of that is or –

Well the acquisitions we made in the first quarter of this year contributed very little. Most of what you are seeing there are the acquisitions we made last year – Joe Mandelo – Fidelity and Company: The CPI, right.

Right. The CPI that we did not have in the first quarter last year that we acquired midway through last – through the year. All in, our acquisitions probably accounted for 5 points of that 14 point increase. Joe Mandelo – Fidelity and Company: Okay. And also could you talk about maybe about your end markets. Maybe more specifically on your troubled end markets, heavy duty trucking and the semi-conductors over a plastimer. Just how – what you are seeing if you see maybe a bottom [inaudible] and what you are looking forward to the in the rest of ’08 in that respect?

Well, I do not know that we have any particular good crystal ball or visibility into that that you all do not have in kind of the general economic conditions. Because that is really what it is more tied too. The commercial truck market really dropped significantly starting in the middle of last year and has continued this year even, at least in the first quarter even below what our expectations were going into the year. Now, that said it cannot go a lot lower. The demand is off significantly even from a weak – even from the weak levels of last year and you continue to see the ton haulage numbers in the US are fairly holding up reasonably well. So it is – sooner or later we are going to need more trucks and trailers. I do not know. It is always tough to say we are at the bottom but if we are not there we have got to be very, very close. That is the one that really impacts us most directly that it is obviously a cyclical business and we compete right in there in the deep of the cyclical business. Joe Mandelo – Fidelity and Company: Right. And finally could you just go geographically, could you just give some sense of how you are looking geographically? What you are seeing and what you expect going forward?

Yes. I think our European operations would all say that demand continues to be okay. I do not think anyone characterize it as real hot demand. I think they would say that the growth that they have been seeing over the last number of years has slowed while it is still growing it is not growing at the pace that it was. We are new into China and getting those up so I would anticipate, regardless of what the fundamentals do over there, we are obviously a small player in the grand scheme of things in China. But we have nothing to do but grow over there because it is basically new operations and it is a growing new market for us. So we are very excited about the prospects there. Obviously the Middle East is still doing well with all the – with the strength and energy in oil and gas markets. And then when you look in the US it is very mixed. Our metal and mining, our steel, our energy, our nuclear energy, all of those markets are actually pretty strong and it is the general industrial portion of the US as well as the truck and automotive, which we have talked about, that are the ones that are weak. Joe Mandelo – Fidelity and Company: All right. Thank you very much guys.

You are welcome.

We will take a follow up from Todd Vencil at Davenport & Co. Todd Vencil – Davenport and Co.: Okay thanks. I wanted to do a little housekeeping items here. Bill, what were your shares diluted out at the end of the quarter?

The average share were 21.5, I believe. Again we did that share repurchase in March that we only really had a third of the benefit of that. Our average – our share count should be to 20.3, 20.4 I think. Todd Vencil – Davenport and Co.: Okay. And when are you going to – in regard to the other 50 my understanding has been sometimes these companies that have an authorization and maybe they use, maybe they do not. Your intention is to go ahead and knock that out, is that correct? When the time comes that you want to start.

Yes. Obviously our board did the authorization with the intentions that that is what we are going to do but of course, we will look at prevailing market conditions, the situation of the company, etc. as we go into that phase which should be starting in the fall time period after we get done with ASR. Todd Vencil – Davenport and Co.: Okay. And just out of curiosity you say once you get done with the ASR what are the mechanics on that that are still going on. Your counterparty out there actually accumulating shares against their short or how does that work?

The – at the time that the ASR was executed the counterparty went out and borrowed 1.7 million shares the equivalent of 50 million shares at the market price at the time. Borrowed those 1.7 million, turned them over to us and they were immediately retired and now over the course of a three to five month period they are in the market buying those shares to repay the people that they borrowed them from. Todd Vencil – Davenport and Co.: Got it. And you think that will be three to five months you said.

Yes that is the time period is somewhere within that three to five month time period. And to the extent that the $50 million was different than the average price during that period of time there will be a settlement, settle up sometime in the third quarter. Todd Vencil – Davenport and Co.: Are you guys on the hook for the entirety of that settlement? By which I mean to say do you share the market risk there or do you bear the whole market risk?

We have the market risk and we will, at the end of the term we have an option of either settling up in cash or we can issue additional shares to the counterpart. Todd Vencil – Davenport and Co.: Okay got it. That – the next issue. You mentioned that you are going to have another 1.5 million of proxy expenses, approximately flight related expenses in the second quarter. Was that pre-tax?

Yes. Todd Vencil – Davenport and Co.: Okay and then could you talk about just what your CapEx and D&A expectations are for the year?

Sure. Our capital spending, we had indicated last year, I think we spent about 47, 48 last year. We indicated that we anticipated an increase in that spending, a slight increase. We still – that is still in our forecast at this stage and our depreciation is in the low 30s or low to mid 30s, 34, 35, I believe for the year full year. Todd Vencil – Davenport and Co.: Okay thanks a lot.

And that does conclude the question-and-answer session. At this time I will turn the conference back over to Mr. Washington for any closing remarks.

Thanks everyone for dialing in and we appreciate your joining us this morning. And again if you have follow up questions please feel free to call me at 704-731-1527. We look forward to talking to you again in the future.

And that does conclude today’s conference. Again, thank you for your participation.