Good morning ladies and gentlemen. Welcome to Newell Rubbermaid’s First Quarter 2009 Earnings Conference Call. At this time, all participants are in a listen-only mode. After a brief discussion by management, we will open up the call for questions. Just a reminder, today’s conference will be recorded. Today’s call is being webcast live at www.newellrubbermaid.com, on the Investor Relations home page under Events and Presentations. A slide presentation is also available for download. A digital replay will be available two hours following the call at 888-203-1112 or area code 719-457-0820, that is for international callers. Please provide the conference code 8804754 to access the replay. I will now turn the call over to Nancy O’Donnell, Vice President of Investor Relations. You may begin. Nancy O’Donnell: Thank you, Mark. Good morning. Welcome to Newell Rubbermaid’s first quarter investor review, we appreciate your participation. Presenting this morning, as usual, are Mark Ketchum, the company’s President and Chief Executive Officer, and Chief Financial Officer, Pat Robinson. I’ll begin the call with our forward-looking statement reminder. On our call today, management will make certain forward-looking statements that it believes to be reasonable at this time. Actual results could differ materially from those indicated by these forward-looking statements as a result of various important factors, including those detailed in our most recently filed Form 10-K and 10-Q. We further caution you that the company does not undertake and specifically disclaims any obligation to update any forward-looking statements that we make today. We will also provide certain non-GAAP financial measures during the call. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures are included in our press release and are also available on our website. Thank you. And I’ll turn the call over to Mark Ketchum.

Thank you, Nancy. Good morning everyone and thank you for joining us today. While the economy continues to be a major challenge for all of us, I am pleased to report that Newell delivered first quarter normalized EPS well ahead of our guidance range. In addition, we generated meaningful expansion of both gross margin and operating margin and a significant year-over-year improvement in operating cash flow, all in the face of a very tough sales environment. When we last reported to you at the end of January, we told you we were committed to protecting earnings and optimizing cash generation as we manage through this recession. We told you revenues would be more volatile and unpredictable than normal. We also committed to being flexible and adaptable to these conditions. That mindset and the contingency plans that we put in place have allowed us to get out in front of the situation this quarter and exceed our EPS and cash flow targets. As we continue to weather this economic downturn, we remain focused on delivering our cash and EPS targets, while protecting the long-term health of Newell Rubbermaid and positioning the company for growth as the economy rebounds. Let me briefly review our Q1 results. Net sales declined 16% in the quarter. This was in line with our most recent guidance and slightly worse than the decline that we had anticipated at the beginning of the quarter as customers continued to pare back their inventories. Product line exits and foreign exchange negatively impacted sales by almost 10 points, while acquisitions added about 4 points. In simple terms, core sales were down 10%, about half due to customer de-stocking and half due to lower consumption. Gross margin was 35.1%, an improvement of 90 basis points compared to last year. This expansion was…

Thank you, Mark. I’ll start with our first quarter 2009 income statement on a normalized earnings basis. Net sales for the quarter were $1.2 billion, down 16% to last year and consistent with our revised guidance of a sales decline in the mid to high-teens. Our core sales decline excluding currency, acquisitions, and product line exits, was approximately 10% in the quarter. We estimate that about one-half of this was driven by retail inventory de-stocking and the remainder was due to lower consumer food traffic and corresponding lower demand. Planned product line exits contributed a negative 5 points and unfavorable foreign currency also contributed a negative 5 points to the sales decline. Both of these numbers were in line with our expectations. Acquisitions contributed approximately 4 points of growth in the quarter. Gross margin was a positive story for us in the first quarter. We generated $423 million or 35.1% of net sales, which was a 90 basis point improvement over quarter one of last year and a 230 basis point improvement over the full year 2008. This improvement was largely driven by the favorable impact of product line exits along with better than anticipated input costs and the read through from 2008 pricing. These improvements more than offset an unfavorable customer and product mix, as well as the drag on margins from lower volume in our manufacturing facilities caused by the significant sales decline and the disciplined management of inventory levels. We also did a good job this quarter managing down our structural SG&A costs. We told you in December that we were taking aggressive actions to manage SG&A spending this year. We saw the benefit of those actions during the quarter. We also told you that if sales trends were more negative than our guidance, we would proactively…

Thank you, Pat. Over the past several months, we’ve asked everyone at Newell Rubbermaid to rise to the challenge and help make 2009 a year of fulfilled opportunity. We’ve asked them to focus on the things that are in our control. This means finding ways to simplify work, reduce cost, conserve cash, gain market share, and build organizational capability for the future across all of our businesses. Our first quarter results are a testament to the hard work of new associates. They are rising to the challenge and I appreciate their efforts. It is our responsibility to manage the company appropriately for these challenging times and yet, always keep an eye on Newell Rubbermaid’s long-term success. And so, while we are relentlessly focused on managing through the near-term challenges, our long-term strategy has not changed. The biggest opportunity presented by the current crisis is to challenge the status quo. The cost reductions that we need to make are being made very thoughtfully. We are cutting the least essential and the least effective structural and demand creation SG&A dollars. Conversely, we are protecting the most effective. This not only allows us to deliver our short-term objectives, but also gives us tremendous upside leverage when consumer confidence and spending recovers, as of course it will. Given the volatility and unpredictability 2009, we will remain flexible and adaptable, managing the business to protect earnings and cash flow. If economic conditions worsen, we have contingency plans in place to help us ensure that we can continue to deliver on our cash and EPS targets. Our solid first quarter results in the face of a weaker than expected sales environment support our confidence in doing so. We are encouraged by the market share gains achieved across key portions of our portfolio as a result of our investments in consumer-driven innovation and strategic brand building. The exits from low-margin, commoditized product lines, while painful in the short term, make us healthier long term. We demonstrated that our brands do matter to consumers and we believe that they will be the key growth driver as we return to a more robust economic environment. Our transformation to a best-in-class consumer innovation and brand new company is continuing and we look forward to sharing our progress with you. With that, I’ll now ask the operator to open up the line to questions.

Thank you. We will now begin the question-and-answer session. (Operator instructions) Your first question comes from Chris Ferrara with Merrill Lynch. Chris Ferrara – Merrill Lynch: I just wanted to ask – Pat, you were talking about us seeing and other people seeing possibly a bottoming out of the economy, you said you are not ready to make that call. I’m just wondering is that because you are not seeing it in your end markets or is it because maybe you are seeing it, but you really don’t want to base anything on one quarter as worth of seeing it or one month worth of seeing it?

Chris, let me take that one. The answer is we are not seeing a strong enough indication across the big enough portion of our portfolio to make that call. So, the evidence is still too spotty. Chris Ferrara – Merrill Lynch: Okay. And I just – I guess real quickly on gross margin – I mean, so obviously you are up pretty nicely this quarter relatively to where I guess we think you would have come in. I guess simply, is there any structural reason why Q4 gross margins in the business would be lower than any other quarter across the businesses? I’m just looking at that 30% that you guys put up last quarter and obviously, there was a lot going on in the December quarter of ’08 versus the 35% we saw in the December quarter of ’07. So just – I guess simply stated, structurally is there any reason why that – why Q4 would be lower than every other quarter?

No, there is not.

I think fourth quarter of last year was specifically impacted by – as we saw the rather sudden decline in November and December, we reacted in our manufacturing locations and starting shutting down production and obviously that affected our ability to absorb some of the costs.

There was also some inventory write-downs we took in the quarter that affected fourth quarter of ’08 that were sort of one-time in nature. Chris Ferrara – Merrill Lynch: Great. Thanks guys, I appreciate it.

Your next question comes from Joe Altobello with Oppenheimer. Joe Altobello – Oppenheimer: Hi guys, good morning. The first question – I just wanted to follow up on Chris’ question on the gross margin. When do we start to see the commodity costs pullback really push gross margin higher, is it 2Q or 3Q or are we starting to see that already?

Well, as you know, resin has been running favorable for us; it’s one of our commodities. Some of the other commodities will certainly level off, but year-over-year they are still showing increases for us, but we are not going to comment on each of the pieces. The product line exits are probably the biggest – are the biggest driver of our gross margin improvement. We had the 2008 pricing carryover in our normal productivity in our plants, which are driving positive gross margin improvement. On the negative side, we have the transactional effects and we are still seeing the negative mix from the consumers and customers frankly trading down. But net of all of that, we said it’s going to be positive and the product line exits alone will be positive 200 basis points when we are completed. So, we said that all along. So, those are the drivers, but we don’t want to break out each of those for you individually just because they move so frequently and we will be wrong whatever we tell you. Joe Altobello – Oppenheimer: Right. So, even if you exclude the product exits, all of the other moving parts you mentioned are moving in the right direction. So, I guess the point I’m trying to make is that the up 90 BPs this quarter is probably a low watermark.

Well, yes, I think as a delta maybe the low watermark – as a delta, it will probably be the low mark, you are right. But as an absolute number, I’m not sure it will be the low mark, but those margins can be maintained for the rest of the year and would be a reasonable assumption. Joe Altobello – Oppenheimer: Okay. And then in terms of the Office Products business, obviously the sales were pretty weak, but you held your operating profit very nicely. What’s going on there that is different from the other segments?

I think they took the most actions from an SG&A standpoint because of that substantial sales decline. So, they – of our SG&A decline, they were the largest piece.

And again, I’d just remind you, Joe, that the decline – out of that 24 point decline, 14 points of that was FX and purposeful product line exits.

Which have very little drop to the bottom line compared to our core sales decline. Joe Altobello – Oppenheimer: Okay. So, that was not due to the guy who is running Office Products these days?

Well, he has done a really great job, I have to say. Joe Altobello – Oppenheimer: Got it. Okay. And then lastly, if I could, you mentioned some weakness in Europe and in the commercial and industrial end users. Is Europe getting worse at a faster pace and then secondly, what percentage of your business is commercial and industrial?

Well, Europe has certainly caught up with the US quickly. I will say that. So – I wouldn’t say that they are any worse than US right now, but they are certainly equal to the US as far as their economic impact. The commercial and industrial piece, Mark, do you have a percentage of the total business? Are you talking about Office Products or just total –? Joe Altobello – Oppenheimer: Just in general, just roughly.

I don’t have that – we’ll give you a number, I don’t know. Can we get back to you on that? Joe Altobello – Oppenheimer: Sure, absolutely.

Okay. Joe Altobello – Oppenheimer: Okay. Great, thank you.

Your next question comes from Bill Schmitz with Deutsche Bank. Bill Schmitz – Deutsche Bank: Hi guys, good morning.

Good morning.

Good morning. Bill Schmitz – Deutsche Bank: Can we just get some more of the assumptions into the model? I mean maybe it’s too much granularity, but did you say what you think the commodity pressure is going to be in aggregate for the year or what the benefit is going to be?

No, we are not saying that. No, we don’t want to break that out because it changes every quarter, Bill. And if we told you a number even a quarter ago, we’d be wrong right now. I told you six months ago, we’d be really wrong. So, it just changes so rapidly, we just don’t want to give specifics on each number anymore because –

But I think it’s true as we are expecting that to be offset – to also offset positive benefits of pricing potentially. So, we took some pricing, as you know, last year we were getting carry-through effect of that in the first quarter, but to the extent that commodities go down, that will – they will put pressure on the pricing and then we have to get back some of that pricing. So, we are assuming that that’s a wash. Bill Schmitz – Deutsche Bank: Got you. And then, on production downtime, is that limited to this quarter or we are going to see that throughout the year because it seems like you made some great progress on the inventory side, I mean do you guys start firing these facilities up again?

No. Well, we did a nice job this quarter, a $100 million less growth in inventories than a year ago. I think it’s a super job of the operations and especially in the face of the sales decline that we are seeing, okay? But we expect that inventories will be down year-over-year. That will be the biggest driver of our working capital being down. So we still have some work to do to make sure that we do that. But I like what we’ve done in the first quarter and it’s a great start.

Yes, we will have to continue to take downtime in our factories throughout the year to get our inventory targets throughout all four quarters. Bill Schmitz – Deutsche Bank: Got you. And then, last one if I could, are you – when you talk about retail inventory de-stocking, I mean how much of it is de-stocking and how of it is dilutions? I mean, are you seeing guys say, you know, well, we just don’t want this product anymore for good or is it just we got too much inventory in the warehouse and we are going to work some of it down?

It really is the ladder. It really is we got too much inventory and we are going to work it down. I mean, they are risking and seeing some increased level of out-of-stocks and so on in order to do that, but they are aggressively managing cash as well. And I’d say in some cases, in some channels or customers, they recognize that they haven’t been as diligent in this area as they could have been in the past and obviously, the times demand that they be diligent. Bill Schmitz – Deutsche Bank: Got you. And I lied, and I thought just one more if I could. Was there any change in the pace of sales? I know your January and February were really weak. I mean March and April, did you see any uptick at all in some of the sales trends?

Well, our first quarter was relatively flat month-to-month as far as changes last year. Bill Schmitz – Deutsche Bank: Okay. And how about April?

I’d say so far it is, again, not a material change. Bill Schmitz – Deutsche Bank: Okay. Great, thank you very much.

And your next question comes from John Faucher with JPMorgan. John Faucher – JPMorgan: All of my questions have been answered, thanks.

Okay.

Thank you very much. Your next question comes from Wendy Nicholson with Citi Investment Research. Wendy Nicholson – Citi Investment Research: Back to Chris’ question, is the fourth quarter was really just an anomaly due to sort of production downtimes? I mean, is it reasonable to expect that in 2009 full-year gross margin could be in the kind of 34% to 35% range again or is that just too aggressive?

I don’t think that’s unreasonable at all. Wendy Nicholson – Citi Investment Research: Okay. And the 200 basis points of the product line exits, I want to go back to the – original guidance I think you gave us was the two-thirds of the product line exits were going to come from just SKU discontinuation and a third from the sale of the businesses or the sale of the products. Has that ratio changed and I’m just wondering how the timing of that’s going to flow?

Well, I’d say the ratio has probably not changed. Again though, as we assessed our ability to make the divestitures of those businesses that we think are – can be pulled out and divested and don’t find the right markets for those. We continue to consider all the other alternatives. So, ultimately that ratio could change and if it changes, it will change in the direction of less divestiture and more just flat-out exits. Wendy Nicholson – Citi Investment Research: And do you have a timeframe in mind? In other words, because I’m trying to figure out that 200 basis points, is it a, hey, we got to realize that over the four quarters, six quarters, if we can’t sell it, boom, it’s gone or what’s kind of the internal discipline or thinking around that?

We think we are going to be out of roughly 80% of it by the end of this year and I think it’s the best way to think of it and yet that will affect all four quarters of the year. Now, recall we made this announcement in July of last year. I told you at that time we were giving our customers time to find alternative supplies, normally about six months. So, while we started to see a little bit of exit in the fourth quarter last year, most of that decline we are going to see throughout this year because most of them took advantage of that six-month window we gave them to continue buying our product lines and then we’ll see the effect – it will be a year-over-year effect in all four quarters this year. It started out reasonably strong in the first quarter, it will be even strong in the second and third quarter and will start to fall off a little bit in the fourth quarter because as I said, we saw some of that last year in the fourth quarter.

And really, the only reason we are not – our goal is to be out all of it this year but because of the market for these – trying to sell these businesses is just not available right now, we won’t reach that goal. Wendy Nicholson – Citi Investment Research: Fair enough, but that sounds great. But my last question is just on the pricing side, Mark. In response to another question I think you said that you were anticipating maybe some price rollbacks given the raw material environment and how much relief you’ve seen. I’m honestly surprised that you haven’t started to see that sooner or already given just how much resin has come down, how big private label is in some of your categories and how weak the consumer is, but it sounds like you haven’t seen anything yet. Is that right?

Well, let me respond kind of to each of those elements, Wendy. One, remember we are getting out of a lot of these resin-sensitive categories. So, the very categories we are exiting, in many cases are the ones that are resin-sensitive commoditized, all right? So, we wouldn’t see – have to get back pricing because we are getting out. I think we are seeing pricing pressure in general just because – not just because of the effect of commodity costs, but the economy in general, all right? And so, I’m seeing as much pressure, I think that’s due to that. Pat said before and it may have not registered, but we are actually seeing cost increases still year-over-year in several key areas, packaging, our source product, some metals. And so, we actually are still seeing increases and therefore, we’ve got pretty information to go back to our customers and say, you know what, we are still – the pricing that we took is still pricing that’s appropriate to be taking. But as I said, we are going to be responding to pricing I think as much because of the total competitive environment as anything else. And the other thing is what we are doing is we are really judiciously looking at some of the requests because the requests from some of the customers are kind of crazy we think. They are going to destroy the value in the category and we don’t want to chase those price points. We would rather walk away from the promotional sales on some of these possibilities than to let our brand be exposed to extreme discounting because it doesn’t help in the long run. That’s – I mean, so we are considering all of those factors in there when we are talking about what we expect to see happen with pricing and that’s why we are not being too aggressive with our – the positive, potential positive impact of pricing even though we had a good effect in that in the first quarter. Wendy Nicholson – Citi Investment Research: Got it. Wonderful, thank you very much.

Your next question comes from Budd Bugatch with Raymond James. Chad – Raymond James: Good morning, Mark, Pat, and Nancy. This is actually Chad [ph] filling in for Budd.

Hi, Chad.

Good morning. Chad – Raymond James: A couple of questions if I may. Congratulations obviously on a very good performance in Q1, although we were certainly surprised by the magnitude of the upside relative to your guidance considering you had reaffirmed that fairly close to the end of the quarter. Could you maybe give us a little more detail or help us understand – I mean, what went right, what really drove the variance versus the guidance and why was it so much better?

Right. Well, first let me respond to why we didn’t say anything different on the guidance when we talked in March. I’d remind you that our visibility of sales is very immediate, all right? We get daily sales reports and so by the end of March, I get a real good idea of what the first quarter sales are going to look like. We normally roll up our profit numbers on a monthly basis and even then not all of the items on every line item there. And so, we just – we didn’t have any reason to believe that we are going to exceed guidance by that much. We were tracking at the top end of our guidance range, but not there. Second thing I’d tell you is that my expectation is that our businesses are all managing their business conservatively. We’ve told you before we are doing everything we can to protect our cash and our EPS numbers. And so, I think that’s – we are seeing that come through, businesses are managing. I’ve told them to manage for the worst and then be pleasantly surprised when things turn out a little bit better and then in fact, that’s what – that’s exactly what they are doing. So, we saw a penny or two across to all of our – each of our businesses and a penny or two from corporate and that added up to the difference between us being at the high end of our guidance and being at $0.20. Chad – Raymond James: Great. Well, that’s obviously very good to hear. Another question, you maintained the FY ’09 revenue outlook for down 10 percentage points to 15 percentage points and even though sales in Q1 were down worse than that and we are expecting Q2 now to be down about 20 percentage points and Pat talked about Q2 being a little heavier impact from the product line exits and currency, but it does seem to assume a moderation in the decline in the core sales and should I read that as you are assuming consumer demand remains pretty weak, but maybe less of an inventory reduction at consumers or how do we think about that?

No, that’s exactly the right way to think about it. We will have less of an impact from inventory reductions by customers as the year goes on and then, finally when we get to the fourth quarter, we actually will see an easier comp. Chad – Raymond James: Okay. And one last question. Pat, could you share with us the assumptions for sales and operating margins by segments that you’re embedded into the ’09 guidance?

Well, not operating margin, but sales, we’ve said before that Home & Family should be at the better end of our guidance and the other two segments at the lower end. So, that’s the extent of what we talked about before and we haven’t given operating guidance by segment and we are not going to now. Chad – Raymond James: Okay. Thanks a lot, guys. Good luck for the rest of the year.

Thank you.

Your next question comes from Connie Maneaty with BMO Capital Markets. Connie Maneaty – BMO Capital Markets: Thanks. First a follow-up on that last question. I mean, the variance from your last guidance was so surprising. Were you looking – before you realized how strong the quarter was going to be, were you anticipating that the gross margin would decline because of the product line exits?

We were never anticipating it was going to decline, we thought it would be up year-over-year. But as Mark said, we don’t get real-time updates on our earnings; we are – update on our earnings is on a monthly basis. So, at the time we did the pre-announcement we had the February information and really the improvement was right across all the segments, all the segments beat their numbers by a penny or two and then we had about a penny or two improvement at corporate. So, it was just – but we expected to be at the high end, but the combination of that brought us to $0.20. Connie Maneaty – BMO Capital Markets: Okay. Why was interest expense so low in the quarter? Is it the timing of all the financing or is there something quirky in the quarter?

No, that’s right. No, we should expect now the interest expense is going to increase because of the new financing that we’ve done and to be relatively flat now by quarter for the rest of the year, so kind of in the mid $0.40 range, $0.45, $0.46 a quarter. Connie Maneaty – BMO Capital Markets: Okay. That’s all I had.

I’m sorry, $45 million, $46 million a quarter. Connie Maneaty – BMO Capital Markets: Thanks. That’s all I had.

Your last question comes from Linda Bolton Weiser with Caris. Linda Bolton Weiser – Caris: Hi, thanks. I was under the impression that really your intent on the product line exits was to eliminate things that were highly based on certain commodities, like plastic. But it does seem like some of the stuff you are doing is quite strategic like I think you mentioned the woodcase pencils.

I just said commodity sensitive and not responsive innovation, wooden pencils, the number 2 yellow pencil with a pink eraser is not that innovative.

I will point out that is only an exit in North America, not in other areas of the world where woodcase pencils are still very important, primarily Latin America. So, we will stay in the business there, but North America they’ve become commoditized and it’s not a good category for us. Linda Bolton Weiser – Caris: So, are there any other areas that are like that, that are not so much quantity based, but just based on the nature of the product that you are exiting or planning to exit?

There are some that don’t fit our business model such as, our Ashland business doesn’t fit our models and our OEM business in our Tools & Hardware segment that’s an OEM supplier to the window industry. So, it’s not a business that we would respond to any type of marketing or input. So, that’s another example of one that wouldn’t fit the original characterization. Linda Bolton Weiser – Caris: Okay. And – I mean, just in many years of following Newell, it just seems like you are always exiting and divesting and deciding something isn’t a really good business to be in. I remember, Newell always used to say never get into anything with electrical cords attached and here you are, getting into electrical things in Calphalon. So, are you kind of coming to a period where you think the product line exits and all of this will be really over or is this just a perpetual thing with the way Newell is as a company?

I wouldn’t want to characterize it as perpetual because of the way Newell is as a company. I would tell you, Linda, that I think this has been a key strategic plank for the time I’ve been sitting in this chair and that key plank has been we are going to change our business model and we are going to get the portfolio right to fit that business model. We started telling you – we started breaking down our business into – one of the ways we looked at it was looking at it as what part of it is commoditized, what part of it is premium branded, what part of it is affordable luxury, and what part of it is commercial and industrial and we said, we want to be in those latter three categories, but not in the commoditized part of it. In 2003 or 2004, we had as much as 44% of our total revenue in that commoditized category. Coming into 2008, it was still roughly 10%. So, we still had a portion left to go and with the moves that we announced in July, we are basically addressing that last 10%. So, as we come out of 2009, we think that portion that’s commoditized will be low-single digits, 1% to 3%. So, I think we’ve been doing what we said we are going to do and we will have that – we will have a portfolio at the end of 2009 that we think is almost entirely a good business model. That said, I’ll never say that we shouldn’t be continuing to look at what’s it going to take to optimize the business model. Business has changed, competitive situation changes and so on, but at least with this round I think we will now have the vast majority done, but I would hope that you would expect us to always evaluate our portfolio every year and add good things and take away less good things. Linda Bolton Weiser – Caris: Okay. And just – can you just tell us what is the magnitude of the dilutive impact if the share prices stays as high as it is, how much of that’s EPS?

Yes, it’s out on the web, but let me help you out here. Hold on just a second. At a – well, there is two types of dilution first of all, one is economic and the other is GAAP, okay? And the economic dilution is less than the GAAP dilution. They will become the same at the maturity of the security in five years, but in the mean time the GAAP dilution will be higher, okay? And we can explain that offline why that is, but the GAAP dilution at a share price of, let’s call $11 a share, is around 3% and zero from an economic standpoint of that price. Linda Bolton Weiser – Caris: Thank you very much.

If we were unable to get to your question during this call, please call Newell Rubbermaid Investor Relations at area code 770-418-7662. This call will be available on the web at www.newellrubbermaid.com and on digital replay at 888-203-1112 or area code 719-457-0820 for international callers with the conference code of 8804754, starting two hours following the conclusion of today’s call and ending February the 12th. This concludes today’s conference. You may disconnect.