Good day ladies and gentlemen and thank you for standing by. Welcome to the Rollins Inc.Q3 2010 conference call. During today’s presentation all parties will be in a listen only mode. Following the presentation the conference will be open for question. (Operator Instructions) this conference is being recorded today, and the date is 27 October 2010. I would now like to turn the conference over to Marilyn Meek from the Financial Relations Board, please go ahead.

Thank you. By now you should have all received a copy of the press release however if any one is missing a copy and would like to receive one, please contact our office at 212-827-3746 and we will send you a release and make sure you are on the company’s distribution list. There will be a replay of the call which will begin one hour after the call and run for one week. The replay can be accessed by dialing 1800-406-7325 with the pass code 4372650. Additionally the call is being webcast at www.viavid.com and a replay will be available for 90 days. On the line with me today are Gary Rollins, President and Chief Executive Officer and Harry Cynkus, Senior Vice President, Chief Financial Officer and Treasurer. The management will make some opening remarks and then we will open up the line to your questions. Gary would you like to begin.

Yes thank you Marilyn. Good morning and thanks all of you for joining us on our third quarter 2010 conference call. Harry will read our forward-looking statements and disclaimer and then we will begin.

Thanks, Gary. Our earnings release discusses our business outlook and contains certain forward-looking statements. These particular forward-looking statements and all other statements that have been made on this call excluding historical facts are subject to a number of risks and uncertainties and actual results may differ materially from any statements we make today. Please refer to today’s press release and our SEC filings, including the risk factor section on Form 10-K for the year ended December 31, 2009 for more information on the risk factors that could cause actual results to differ.

Thank you, Harry. We are very pleased with the record results for both the quarter and the first nine months of this year. With revenues increasing 6.4% over the last year’s third quarter and 5.2% up year-to-date. On August 1 we completed the acquisition of Waltham Service, a leading New England pest control company that was established in 1893 even before Orkin started. Excluding the contributions that Waltham made to our results residential pest control posted an impressive 5.5% increase in revenues and the highest growth rate we’ve seen in residential revenue since the third quarter of 2006. Commercial revenues increased 6%, aided by strong growth in fumigations while termite increased approximately 1% over last year’s third quarter. These strong revenue results contributed to a 12.2% increase in net income. As we discussed on our second quarter call, our focus this year has been on increasing new sales yield. Simply yield is the end product after we get a lead to sell the lead and perform the start of the account. Our team along with (ECG) worked together to develop five simple ways for our employees to better engage customers to improve customer yield and customer retention. We want to make it easier for the customers to work with us and our results have been positive. Given the publicity that bed bug have received I will be remiss if I failed to recognize their impact on our quarter. I have always looked with pride at the growth rate of our mosquito service which is increasing at better than 20% annually, but our bed bug business is leaving the mosquitoes in the dust. Needless to say bed bug demand continues to grow and represents over 4 million in revenue in this quarter alone, up over 75% from the same quarter last…

Thank you, Gary. Good morning, appreciate you all joining us on the call. In the third quarter, we accelerated the solid growth from the first half of the year positioning us well for the remainder of this year and a great stepping stone for next year. Today, we reported revenue of 305.1 million, our first $300 million quarter. This represented 6.4% revenue growth, net income increased 12.2% to 25.5 million or $0.26 per diluted share compared to 22.7 million or $0.23 per diluted share for the same period in 2009. The fundamentals that drive our revenue, liens, pricing, closure and retention remains strong and continues so into the fourth quarter albeit it’s still early in the quarter. Clearly, our positive momentum strengthened. Let’s look deeper into the result. Certainly, revenue was aided somewhat by the acquisition of Waltham Services as their results were included for two of three months in the quarter. Excluding Waltham, it still remains our strongest organic growth in some time with revenue growth of 5.1%. The stronger Canadian dollar made little impact listing revenues just (Inaudible). Revenues on a comparable basis to last year excluding Waltham and Canada, we grew 4.9%, a nice improvement over last quarter’s comparable growth of 4.2. While fed funds had generated a lot of interest in our company off late, I think it’s important to remind investors of the underlining strength in our business is the reoccurring nature of most of our services. In fact, nearly 80% of our revenue is recurring. Our best quarters, spring and summer are now behind us. We always hoped for a late winner but what is most important to us at this point is our gross contract advantage or GCR which describes so much recurring business we are carrying into Q4. This year, it will…

Thank you Harry. We’re now ready to open the call for any questions which you might have.

We will now begin the question and answer session. (Operator Instructions) our first question comes from the line of Clinton Fendley with Davenport and Company. Please go ahead.

Wondered if we could get a little bit more color just on the 5.5% growth that we saw in residential and any trends geographically or any pricing and end volume commentary?

Well, we had overall improvement and all of our business units had good revenue increases, which always makes you feel good. Demand was up which is always important for us both on the internet and convectional telephone leads. We continue to make progress as far as our pricing is concerned. We completed a successful price increase campaign for existing pest control customers. So I think we have just a lot of things coming together in the quarter that contributed a little here, a little there and we didn’t see any unique thing occurring as far as any geography or any one particular business unit.

And a lot of these pricing changes were made back in the late spring timeframe. So I guess it’s safe to say that that’s definitely stock at this point then.

Yeah, all the price increases went into effect at the end of the, by the end of second quarter. HomeTeam price increases effective July 1, if we took the total impact of the price increase this year versus last year, this year is actually a little lower than last year, not significantly. So the quarters are pretty comparable in terms of the dollar from the price increase this year versus last year.

The great thing in that current price increase is the gift that keeps on giving. So we did, you know it rolls into this quarter, it will roll into next quarter and so forth. So we’ve done a lot of research, a lot of work on our pricing and we watch it very carefully.

Any reason why your door-to-door sales approach is being used a lot less in the current environment?

We were really concerned that these customers were not as sticky as conventionally acquired customers. The prices continue to go up, finding people to do this. We hired college students who would work showing independent organization and they become fewer and fewer so the rates kept climbing. And we just kind of sit down and up to a pencil and just decided although it was painful to stop, it just wasn’t the best thing for our business and as Harry stated we use it sparingly, if we have our unique market that we really think that we can turn up the growth significantly. And we can make this economics work for us and we will selectively do it. Its also with the door-to-door program that’s more of an impulsive buying decision and certainly in this environment people are less inclined to make that impromptu decision. So we are bad and the economics of it that’s very eluded to at a high cost of sale, the retention is not as good as you know I think it’s because of the impulsive nature of the buy that we dialed at that significantly.

And switching gears for just a moment, what is the time line for the rollout of the replacement for the Focus system? And just any thoughts here as to the CapEx requirements for the new system?

Well I think the rollouts going to take as close two years I mean if everything because those enhancement is having you know they were having to do now although this is a very robust product, we just have some new launches in the way we manage our business and run our business. So we can’t really take the product right off the shelf and have it to fill all of our requirements.

And we don’t have a clear rollout schedule, we are doing a pilot, we are converting the one branch here in the fourth quarter and as a result we need to evaluate those results, do additional changes if any needs to be made, incorporate it, we should really then determine what the roll-out would look like. CapEx, again until we have a roll-out schedule plan, I really can’t give you any color on the impact next year but its not anything out of the ordinary as CapEx runs pretty consistently between 10 and $20 million a year. We hit the highs of 20 million when we do something like this. This year we are at the low end. So if there is anything outside of that range once we looked at to get a better picture, the roll-out will give you more color at that time.

So Orion in total, if I’m not mistaken, was about, what, $15 million? So would this be more or less than that?

No. I was far or less to 15 million.

I think that may have been the intent when we got fairly finished. But over a couple of years it’d certainly be in that neighborhood to 15 and 20 million that could cost to some of that CapEx, some of the internal cost trading.

One other things that we have kind of mastered to some extent is this web-based training which as opposed to sending a bunch of people out and physically being on hand at locations to put on this systems. We’ve had good success with some of our smaller projects by doing our training over the web, more people can become familiar with the routines and ask questions and so forth. So one of the benefits I would think here is your is comparing to Orion that next system roll out should be more economical because their training will not be so hard.

That just one of the things that we’re pointing right now but we’re really early to this process and we’ll give you more color when we really understand the full impact at this point. We’re planning to absorb the cost in our normal operating cost and if it falls outside of that, we’ll let you know.

(Operator Instructions) Our next question comes from the line of Jamie Clement. Please go ahead.

Just a follow-up question on the software system from Clint’s questions. What exactly, from like an efficiency standpoint, are you looking to achieve? I’m not talking numbers, but just sort of like from a process. I think you mentioned you had some of your different brands were using different systems. What are the top two or three sort of cool things you hope to achieve with the system?

I will be sharing data more carefully now, measuring our advertising and marketing results, having common definitions as far as the way you count customers and the way count retention. And you can imagine each of these systems have a little twist or return. So I think we would be adapting common definitions to measure and account for the data and performance of the business. We are certainly complying with GAAP and Sarbanes and all of that but it is frustrating when you try to find out exactly how many lease do we have in the whole company and in the end you just find it’s not everybody who counts the lead are saying what. So I think the data side and the marketing as it relates to marketing will be a pretty powerful addition. And it’s just a lot cheaper to maintain one operating software. You don’t have to have a group of IT, three four who are familiar with four different systems. So I think there are just inefficiencies. We’ve not identified all of them but I think the other good thing is this isn’t the focus and I think these non Orkin brands looks towards a universal software system with a little bit more enthusiasm is opposed to trying to adopt Orkin’s system. That’s been one of the positive things Harry gave us and all of our different brands are enthusiastic about getting on this.

And there are no further questions, please proceed.

Well, thank you all for joining us today we look forward to the balance of the year and we will continue to work hard to grow and improve our business and we look forward to sharing year end results with you.

Ladies and gentlemen this concludes the Rollin Inc. Q3 2010 conference call. If you’d like to listen to the replay of today’s conference please dial 303-590-3030 or 800-406-7325 with the access code 4372650. ACT would like to thank you for your participation you may now disconnect.