Thank you for holding and welcome to Rockwell Automation’s quarterly conference call. I need to remind everyone that today’s conference is being recorded. Later in the call we will open the lines for questions. (Operator Instructions) At this time I would now like to turn the call over to Rondi Rohr-Dralle, Vice President of Investor Relations.

Great. Thanks Mika. Good morning and thank you for joining us for Rockwell Automation’s fourth quarter fiscal 2009 earnings release conference call. Our results were release this morning and the press release and charts have been posted to our website at www.rockwellautomation.com. Please note that both the press release and charts include reconciliations to non-GAAP measures. A webcast of the audio portion of this call and all of the charts that we reference during the call are available at that website. The webcast will be available for replay and the materials from this call will be accessible for the next 30 days. With me today are Keith Nosbusch, our Chairman and CEO; and Ted Crandall, our Chief Financial Officer. Our agenda includes opening remarks by Keith that will include overviews of 2009 and our 2010 outlook along with a preview of what you’ll hear during our investor conference on Thursday. Then Ted will provide more details around the fourth quarter and full year 2009 performance and 2010 guidance. There will of course be time at the end of the call to take your questions and we’ll try to get to as many of you as possible, so please limit yourself to one question and a follow-up. We expect the call today to take about 45 minutes. As is always the case on these calls, I need to remind you that our comments will include statements related to the expected future results of our company and are therefore forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Our actual results may differ materially from our forecasted projections due to a wide range of risks and uncertainties that are described in our earnings release, and detailed in all of our SEC filings. So, with that, I’ll turn the call over to Keith.

Thanks, Rondi and good morning to everyone who’s joined us on the call today. 2009 was clearly a very difficult year. More than a year ago we saw a slowdown coming and took early cost actions in Q4 of 2008. We were one of the first industrial companies to provide an outlook for declining revenue in 2009. But business conditions deteriorated even more rapidly than we had expected and for most of the year we were mired in the deepest and broadest global recession of my career. The turmoil in the financial markets exacerbated the economic decline and was a contributing factor in most industrial company’s decisions to slow down production, slash spending, and conserve cash. In this economic environment, we experienced a full year organic revenue decline of 19%. But we did see demand levels in our product business start to flatten out in the latter part of the year. Although our solution order rates declined throughout the year, those declines slowed considerably in the third quarter. So at this point we would characterize business conditions as relatively stable but at demand levels well below the peak of the cycle. In spite of the challenges in 2009, I want to highlight several key accomplishments. We acted decisively throughout the year to right size the cost structure, achieving $300 million of savings in 2009 with incremental savings expected in 2010. We carefully balanced these actions with preserving investments in our core technologies and global domain expertise. We also generated great cash flow this year by quickly aligning inventory levels to lower demand, effectively managing receivables in a difficult credit environment, and appropriately constraining capital spending. I want to thank our employees, partners, and customers for their unwavering support during this difficult year. Before I turn to 2010, I’d like to…

Thanks, Keith, and good morning. As Rondi noted, we’ve posted charts to our website and my comments will reference those charts. I’ll start with the full year results on Chart 1. Sales for the full year ended at $4.332 billion, a 24% decline compared to fiscal year ’08. Currency contributed 5 points to the decline. Excluding currency, sales declined 19%. Segment operating margin for the year was approximately 10%. Diluted EPS from continuing operations was $1.53. Excluding Q4 restructuring charges and special items from Q2, EPS for the full year fiscal ’09 was $1.68, that puts us at the top end of our July guidance range. Free cash flow for the year was $431 million. That’s conversion of almost 200%. We’re very pleased with that result. ROIC for the year was 11% below our long term target levels due to the significant decline in earnings in fiscal ’09. Moving on to Chart 2, Q4 Results Summary, sales in Q4 were $1.074 billion down 28% from Q4 last year. Currency contributed 3 points to the decline. Segment operating earnings were $80 million down from $269 million last year. The decline in operating earnings is primarily due to the significant year-over-year revenue loss. Segment operating earnings in Q4 included pre-tax restructuring charges of $33 million related to our ongoing efforts to appropriately align our cost structure to current demand levels. After tax the EPS impact of the Q4 restructuring charge was $0.17. The $33 million charge was higher than we projected for Q4 at the time of our last earnings release in July. We went deeper on restructuring actions to achieve a total of $80 million of incremental savings for fiscal ’10. The $80 million of savings includes actions taken in Q4 as well as actions taken previously in fiscal ’09 and…

Operator, we’re ready to open the line for questions.

(Operator Instructions) Your first question comes from Stephen Tusa - J.P. Morgan.

So Ted, you said earlier in the call an $80 million number on restructuring. So is that just basically the $120 million incremental restructuring benefit you’re going to get minus kind of the $40 million in partial restoration? Is that the right number or is there something different going on?

Think of the $120 million as two pieces. $40 million of the $120 million is carryover from saving that started in fiscal ’09 and are not related to [inaudible] or temporary actions. The other $80 million of savings is restructuring actions taken in ’09 for which there was no savings in ’09, so it’s $80 million against that $50 million to $100 million of incremental savings we talked about in ’10.

How quickly would you expect the restoration of temporary cost actions to come through?

There will be some natural reset of incentive compensation as we progress into ’10 and you’ll see that basically comes in about equally over the course of the year. On some of the other compensation related actions, we would not expect to begin restoring until sometime later in fiscal ’10, probably closer to mid year when we start to hopefully see some pick up in sales levels.

So if you’re down kind of at the high end of your range, I know you start out kind of a $50 million number for temporary stuff that may have to come back in, is there a [gating] factor around whether you’re down 2 or down 9 or if you’re at the midpoint of the range, is that $50 million all coming back or how do we think about that?

Think about it this way. At the midpoint of the range there’s about a $30 million headwind in fiscal ’10 as a consequence of restoration of temporary actions.

Just lastly, when we look at the seasonality from 4Q to 1Q and the good times you continue to grow from 4Q to 1Q, in the last few years you’ve been down anywhere from I guess 25% last year to down 3% from 4Q to 1Q ’08. Given that this is neither ’08 or ’07, how do we think about kind of the inherent seasonality of the business now in this kind of more depressed level?

I think a couple of things. One, obviously we’re not providing quarterly guidance but the way to think about this year and how we’re thinking about it goes back to a little bit about Ted’s comments, but it’s based upon we saw some sequential gain in the quarter with our product businesses. We would expect that to hold in the first quarter and what would be a detraction would be the solutions business that will be down on a sequential basis, so the net will probably be slightly down on a sequential look at the business and then obviously the year-over-year will be significant decline because of just the timing of the declines in our last fiscal year and it was only a 5% decline in Q1 last year. So sequential slightly down Q1.

Then one last quick question. When you think about the way the companies have spent their capital this year, obviously Cap Ex budgets are down but in the first half people pretty much froze their spending. We’re hearing some of the packaging companies talk a lot about a significant budget flush in the fourth quarter. Maybe you don’t want to use that strong of a term but is there anything with regard to the seasonality this year that makes you feel a little bit better about the flow of business and the products businesses in the fourth quarter?

In the fourth quarter, you mean our –

Calendar fourth quarter.

No, we just believe that the continuation of what happened in our fourth quarter is the return of some spending in particular in our products businesses around the growth in industrial production that we’ve been seeing starting in the late summer time frame, so I don’t think we’re going to see a spending spree in the quarter that runs up to the end of the year.

Your next question comes from John Inch - Merrill Lynch.

Firstly, as a point of clarification, the EPS guidance, Ted and Keith, does or does not include further restructuring costs?

You know restructuring costs in ’09 was about $60 million. We have built in some modest restructuring costs for ’10, ballpark $10 million. And it is in the guidance.

I’m just sort of looking at the puts and takes here. You’ve got about $0.20 to $0.25 of pension headwind. It looks like the restoration of some temporary actions, would I would call fixed labor issues are about $0.16. If you annualize the fourth quarter, ex restructuring of $0.37, that gets you to the midpoint. You look at this sort of $0.35 to $0.40 of headwinds but then you’ve got currency, you’ve got what appears to be a substantial contribution, over $0.65 from restructuring cost savings based on the $120 million. How are you getting $150 million kind of as a midpoint? Am I missing something or is there some obvious large

Actually I think you just walked through a pretty good bridge and the only thing you did not talk about is the relatively significant ex currency volume decline year-over-year at the midpoint.

That’s fair. Now is it also fair to say that… you sort of talked about the restoration of some variable contribution. As you restore some of this contribution later with volume, that will still create for a positive EPS contribution, correct? Because if you’re matching associated volume improvement. Is that not the way to think about it?

I think that’s fair although I mean, we just walked through it, we kind of broke those pieces up, right? We talked about the loss from volume and then there was an offset in part as a consequence of the restoration of the temporary actions.

Okay, that’s fair. What are you seeing in your MRO business and does that provide any kind of a prospective clue as to what may be going on maybe in some of your more shorter cycle businesses?

I think the fact that we have seen sequential growth in our product businesses tell us and just the macroeconomic indicators of improving industrial production tells us that we are seeing stronger MRO I would say operating business and I think also the other thing that you see is that the amount of de-stocking dropped again in Q4 and we believe it’s over now and so that provided a little bit of benefit as well and basically what we’re seeing is manufacturing is running slightly stronger than what it was in our second and third quarters and certainly the pick up in our product businesses is I believe an indication that we’re starting to see some spending in MRO plus people are understanding the cash situation that they’re in, the credit markets, while not great, have certainly stabilized and people understand what they can and can’t do with respect to providing the grease to run their operations, so I think all of that is what we saw starting to play out as we went through our fourth quarter.

Is there any way to size what you think the de-stock had in terms of the earnings per share impact or just earnings impact in fiscal ’09?

I’ll be honest, I haven’t thought about it in terms of an EPS impact. We think for the full year fiscal ’09 we took about a 2.5 point top line hit as a consequence of de-stocking.

Couldn’t you just multiply that --

I could, I just haven’t got it in my head.

But in theory that provides a tailwind as well from the absence of de-stocking, right?

I think that’s fair and then most of that was over, we think we had about a 1% impact in Q4 so as we enter the year off a Q4 run rate, that 1% is not a big number in terms of what we were hoping we will start to see as real economic improvement.

Your next question comes from Nigel Coe - Deutsche Bank Securities.

I just want to clarify the margin question first. You said first quarter sequentially down from 4Q but is that just 1Q or is that the first half of the year?

Let me characterize the first half I guess if that will help you. Basically in the first half what we would expect to see is sales run rates in our product business about equal to Q4 and we would expect solutions to be down in the first half compared to Q4.

The net would be in the first half slightly lower on a run rate basis in 4Q?

Yes.

Then just looking at the [second half] margin guidance of 9% to 11%, and if I reference that to the 10.5% you did in 4Q, I just want to understand given some of the cost savings running through here and the beneficial mix impact of products and solutions, what would drive down the separate margin towards the lower end of that guidance?

I think at the lower end of that guidance it’s basically sales levels, right, and as John has asked about the bridge and he was doing it in EPS, you’re asking basically the same question as it relates to operating margin. I mean, even at midpoint we’re going to face a year-over-year ex currency volume decline and at the low end of the range, it’s a reasonably significant ex currency volume decline.

On a full year basis I agree but from 4Q run rates, it looks like full year’s going to be maybe flat volume wise this 4Q.

Even against a 4Q run rate, the low end of the sales guidance range is substantially lower than the 4Q run rate.

Okay, that’s fair. Then finally if you could maybe just make some comments on how the process business performed this quarter?

Process performed better than the company average for the quarter and actually is another one of the indicators as to why we believe our diversification strategy is working. Certainly the acceptance of planned PAX as a process automation system continues to gain traction in our served markets and that in conjunction with ICS Triflex puts together a very powerful bundled package for both the control and the safety systems for Rockwell Automation and certainly is one of the reasons we continue to be very optimistic in our ability to grow share in process and on a year-over-year basis, we were down 8% in process which is substantially better than the company in general so once again an indicator of the success of the diversification strategy.

So that means that 4Q is probably what, high teens?

Yes.

Your next question comes from John Baliotti - FTN Midwest Securities.

Kind of a housekeeping question to start. The tax rate for 2010 ballpark?

We’re expecting something between 21% and 25%.

Given that the trends you’re seeing more MRO pickup here which may be the beginning of things getting better, what gets you to, considering you’ve got about $0.45 or so of restructuring benefits in 2010 offset by some of the other things like pension, what has to happen for $1.25 to show up? How did you get to that other side of the range?

I think that is basically a flat run rate from Q4 and certainly as many of you have always told us, our visibility is limited so if we do not see that pick up in the second half of our year, that would be what we bracketed for the bottom of our guidance range is basically Q4 flatlined for the entire year.

And if you look at the last month of durables, it seems like if you break down the different categories that they provide and the different end markets, it seems like you’re getting a positive month, a negative month, a positive month, but what you’re starting to see, as it looks like the demand, If you dig into the numbers, it looks like it’s more immediate demand? Is that consistent? As the customer sees demand he does something about it but he doesn’t appear necessarily to be thinking longer term. Is that consistent with what you’re seeing from your customers?

It’s mixed. I would say not in general are we seeing only short term immediate needs. Certainly if you look into more mature markets, that would be a very true statement. It’s much more short term oriented and what can I do given that I backed off so strong in the first half of the year or the first two-thirds of the year. I have to do some minimal work at this point in time and I think that’s what we’re seeing at this point. If you move to some of the emerging markets, certainly there we are seeing some interest in our activity in longer term projects and in particular in some of the commodities businesses. We’re seeing more engineering work going on at the present time. It’s not translated to orders yet but we are seeing some activity and what I would call more longer term investments based upon the belief that those commodity and resource prices will stay reasonably well behaved at the current levels, so I think that it’s a mixture at this point.

I remember toward the end of, just before things started to tail down, you saw nice growth in the emerging markets. I think you guys are talking about the fact that there’s not a third party integrator network like there is in the mature markets like North America so you guys are doing more of the work out of CP&S. Have those customers yet or is it still too early for them to transition to A&S? Is that business still coming out of the CP&S segment?

It’s mainly still from CP&S mainly because it’s infrastructure and resource based industries which has a higher content of CP&S product and then to your point, the emerging markets will have a mix simply because we provide more solutions there for just the reasons you mentioned, that you would expect that to continue, whether it be our growth in our process base or just the fact that there’s a limited SI channel capability for companies to do that via third parties.

Your next question comes from Mark Douglass - Longbow Research.

Can you talk about what kind of sales and volumes would be necessary for the two segments to kind of return to maybe closer to the peak margins that they saw? Considering the restructuring charges you’ve incurred, what would it take to get A&S to say the mid 20s and controlled products say to the mid teens? Do you have any feel for that at this point?

That’s a difficult question to answer and one I’m very reluctant to answer as we are just starting to come out of the worst recession I’ve ever experienced. If you look back on ’09 we lost basically $1 billion of sales ex currency. So I guess an easy answer would be something in that ballpark, maybe a little bit less because of things we’ve done to hopefully improve leverage as we move up.

Can you talk about logics, how it’s doing at this point, is the mix still been more towards growing share from micro and compact logics, and is that kind of negatively impacting the margins at this point? What do you see for logics in 2010?

Logics for 2010 we would expect to continue to grow. The logics was down this year but certainly performed better than the company in total and logics performed better than A&S in total, and in Q4 logics was up sequentially. So we're beginning to see the pickup in that portion of our business and, yes, compact logics is the fastest growing segment of the logics family. If we talk about going into 2010 we would expect logics growth in the high single digits and certainly we would expect to see continued deterioration of our legacy business. And we think it will get back to the more normal declines of roughly 8% to 10% on a year-over-year basis. So that's in general how we have baked the plans for that into our guidance for the year.

And then just related to that, so with compact the fastest growing, does that also play into your focus on OEM sales?

Yes, a great comment. Certainly the reason we're pushing harder and harder into OEM is because we have continued to improve the scalability of the logics platform over the last couple of years and now we can address a growing portion of the OEM machine builders' portfolio. And certainly we believe the highest growth in our OEM segment will come with the compact logic's platform in addition to certainly our motion and visualization packages as well, in addition to safety. We think safety will be a big part of OEM total package and our total capabilities as well. So we've had a lot of good interaction with OEMs the last six months given that their business is down. This is a good opportunity for them to look at new machine designs or cost reduce existing designs. And our technical collaboration resources, design resources have been very heavily utilized in helping these OEMs work on the next generation machines and certainly as demand picks up we're viewing that as one of the areas that we would expect to see improvement on a year-over-year basis once their order books start getting filled up again.

Your next question comes from the line Jeffrey Sprague - Citi.

Just a couple things to clean up from my end, pension contribution, Ted, in cash in 2010, anything on the boards?

I would expect it to be similar to our contribution in '09 which was roughly $30 million, $30 million to $40 million.

Okay, and your tax rate is going to vary based on your income level. That's a pretty wide range.

I would say principally based on income levels.

Okay. Keith, just given how much things have moved around in the last year with this down draft, can you roughly reorient us on your vertical market end exposures, even if it's by kind of big buckets, consumer auto, resources, etc.?

Sure. With our markets today we're probably around 35% consumer. We're around 10% auto and transportation, which would be auto and tire, which means auto is less than 10% to date, probably 5% to 7%, 5% to 8%. We have about 5% that would be in the other category which is marine, water, waste water types of applications. But then we also have the process industry which now probably has grown to about 50% of our revenue. And out of that the biggest one would be oil and gas given our recent acquisitions plus the strength of that vertical. That has been a positive market for us over the last couple of quarters. So that's how I would break it down for you, Jeff.

So then in process you're including kind of the mining and materials business?

Yes, in the process, the heavy industries, we would include oil and gas. We would include mining. We would include metals. We would include chemical. We would include pulp and paper and utility power generation. So water, waste water would also be in there.

And the Pharma business is in there too or that's up in consumer?

No, Pharma business, life sciences businesses would be in our consumer products area. It would be part of that 35%.

Okay, and, Keith, to your point about kind of the short visibility, you addressed it a little bit in some of the earlier questions but just using the compass that you have, how should we expect kind of business trends just to kind of evolve across your portfolio? I mean, as you're looking for the path out of this thing, what are the sorts of milestones, consumer behavior, end market orders, what have you, that you're looking for for validation that we're coming out?

Well, I think a couple of things, Jeff. One, it would be the continuation and growth in our product businesses and that would be an indication that manufacturing is picking up for two reasons. One, that should be an indication that MRO is happening as well as smaller projects that people are running mainly to drive productivity, improve their cost competitiveness or smaller projects just replacing an aging system or an aging line. So that's why we believe product flow would be the first indicator. As it evolves further down, we would expect to see a pickup in our solutions businesses. And a precursor to that will be an order pickup with the front end of that would be quotation activity and in that quotation activity, converting into orders and then the orders be a little longer. And we would expect that consumer industries would be first here in those areas. And obviously the key there will be consumer spending and consumer confidence. And so we need to see that continued steady increase there in the current levels and that will tell these industries to continue to invest and certainly that would be what we believe will be the first and the most powerful engine to come out will be an increase in consumer spending. So that's how I would characterize it, Jeff. And then obviously the differentiation from all of that is in emerging markets it's still going to be just the investment to continue to support their growth. And if they're an exporting country then it comes back to the earlier things I mentioned because most of those exports go to the mature economies. But we would expect to see some growth simply because of the high GDP growth in some of the key Asian and Latin American emerging markets.

Great, and just one brief follow-up on that. So as it relates to that list of things, really we're just seeing perhaps the very beginning, the modest growth in product business and MRO. What percent of your business is MRO now do you believe? I know it's going to wax and wane as the cycle goes up and down.

Well, it's probably around a quarter to our business, maybe up to a third. But it does move around quite a bit and we don't have an ability to track it real succinctly.

Your next question comes from Scott Davis - Morgan Stanley.

I just want to talk a little bit about China. I mean, we've seen some pretty big government numbers so it's hard to know exactly what they are, but numbers coming out of the region and then auto sales today were very, very high, up 60% or so, your business down 10%. I mean, you can talk a little bit about is there increase in competition and some market share shifts that are going on there, the businesses that you're selling into, growing maybe a little less robustly or is CapEx really trailing the recovery.

Well, certainly with respect to China we had negative organic growth in Q4, but sequentially we grew 11%. And China had very, very tough comparables for the quarter. And in total for the year we were down only 5% in China and we have a lot of solutions business there so some of that is lumpy. But we have seen the investments in infrastructure paying off in the second half of the year. That's one of the reasons why we had the sequential growth. And we've also grown, and to your point, automotive has continued to be strong for us in China. And looking forward we expect China for us next year to grow in the low teens and certainly we continue to do well in a lot of the infrastructure investments but also with OEMs and the expansion in some of their more consumer facing industries that they're trying to drive more local consumption on. So we view China as a continued great opportunity for us and certainly do not feel that we are losing any share in China.

Okay, can we talk a little bit about - and I know you alluded to this in some past questions - but pricing on your longer-term contracts. I mean, when you think about some of the big bids that have been out there we've heard of price weakness anywhere between kind of 5%, 30%, even some a little bit higher. I mean, I know there's not a lot of contracts have been out there and big, big projects, but can you talk to the pricing that you're seeing and maybe compare that to last cycle and give us a sense of kind of what's normal, what's not normal?

Well, as we've been saying all year, we ended fiscal year '09 with pricing about a neutral. And there was a recent Morgan Stanley control engineering survey that concluded what we've been saying and that is I think there was a quote in there that there was really no evidence of a price war in automation equipment. So that's the environment that we see. Now, obviously, there are certainly projects that depending upon some of the background or the way some companies view that project is it can be a very competitive situation and certainly that's one of the reasons we need to make sure that our cost structure is aligned so that, if necessary, we can be very competitive. But we haven't seen much of a change compared to previous cycles and we don't expect that to become a headwind for us in next year.

Okay, and then the last question, can you talk about what kind of - you're always looking for [bullying] acquisitions but what kind of assets - do you feel like you have product apps or geographic apps? Can you kind of help us understand what kind of assets would you be looking at? Obviously you can't name names but most of the stuff is much smaller, private companies. It's not much of a conflict for us.

Yes, we're looking for areas that continue to fill those gaps, could be a small core chunk of technology. It could be something allows us to grow our share in a non-US market. And it's also areas that allow us to expand our domain expertise, so our solutions and services areas and then specific vertical applications in information software would be a potential area as well. So they tend to continue to be small bolt-on types that really at the end of the day just let us do more for the customer and allows us to leverage the other pieces of our total portfolio.

Okay, I think we have run out of time, so time to wrap up the call. I want to thank you all for joining us. And, of course, for those of you who have questions, we do look forward to seeing many of you at Automation Fair later this week. And for those of you who can't come out to Anaheim please join us for the Web cast on Thursday morning, so, Operator, back to you.

That concludes today's conference call. At this time, you may disconnect. Thank you.