Good day everyone and welcome to this Roper Industries' year-end financial results conference call. (Operator Instructions) At this time, I would like to turn the call over to John Humphrey, Chief Financial Officer; please go ahead sir.

Thank you all for joining us this afternoon, as we discuss the results of our 2008 fourth quarter and full year performance. Joining me this morning is Brian Jellison, Chairman, President and Chief Executive Officer, and Paul Soni, Vice President and Controller. Yesterday afternoon, we issued a press release announcing our financial results. The press release also includes telephonic replay information for today's call. Please refer to slides to accompany the call which are available through the webcast and also on our website at www.roperind.com. If you will turn to slide two, we start with our Safe Harbor statement. We will be making forward-looking statements during today’s call risks and uncertainties as described on this page and detailed in SEC filings. You should listen to today’s call in the context of that information. And, now if you please turn to slide three, I'll turn the call over to Brian Jellison, President, and Chief Executive Officer. And after his prepared remarks we will take questions from the participants.

Thank you John, here we look at kind of an outline for this afternoon. We’ll talk a bit about the fourth quarter challenge that many people faced and certainly us as well, how the 2008 year played out and what its implications are for 2009. We’ll talk a bit about the end market orientation around 2009 and what we see as risks and opportunities for us and then get into 2009 guidance and take your questions this afternoon. Next slide, the 2004 enterprise overview really I think is best thought about in terms of what was the challenge that we faced in the quarter. First we needed to stay ahead of the curve given the economic uncertainty and unprecedented volatility in the currency situation that was occurring and we’ll talk about currency a couple more times this afternoon, but currency has really very little to do with operational effectiveness but a lot to do with stated numbers. Secondly it was a great test of the nimbleness of our management and leadership culture because throughout it when you have a lot of growth entities and still have a number of growth entities you need to maintain a balance between nimbly reacting to the organic shift and still maintaining your product development and end market disciplines that we have. We needed to assure ourselves that we restructured but in targeted areas not some kind of broad based thing without thought. We had to reset all of the issues around our supply chains, one of the great risks I think of 2009 is a lot of small suppliers falling by the way. We put a lot of energy in November into our supply chain situation and then a deep dive into our operating efficiencies and took some immediate actions and have that more…

(Operator Instructions) Your first question comes from the line of Michael Schneider - Robert W. Baird

Can you talk about Neptune and specifically what occurred there during the fourth quarter with municipal spending and some of the projects you’ve been working on also comment do you have Toronto built into your guidance for 2009 and to what degree is it built in.

In terms of Toronto the way we look at that situation is we continue to work with them. Its really, we don’t see any risk in it at all its just a variety of administrative matters. We originally it looked like might have been able to be booked in the fourth quarter or certainly the first quarter and then the speed of delivery has never been clear but we’re assuming that if it doesn’t start to deliver until the third quarter that it would not help much in the first half of the year. But we have built in a modest amount of revenue and margin into the second half guidance. If that project picked up inertia that would help us earlier in the year then is in our current thinking, but given how slow its gone administratively we’re not assuming that we’ll see much of anything in the first half. We think its kind of a Q3 play.

Can you just talk about the core Neptune projects, have you seen municipalities cease installations and upgrades in the day to day meter business and then talk about the small and mid sized projects, AMR side of the business that were being deployed, were there stalls put in place during Q4 and what have you seen thus far in January.

We haven’t seen any real slowing in anything. The only thing that we see slowing in at Neptune would be people making decisions about deployments and waiting. I think there is this perverse situation with the stimulus package that you probably have some people holding on to see what happens. We’ve curtailed a number of things. We’ve taken some actions in Neptune to reduce costs and I’d say we’re comfortable with Neptune. I don’t think Neptune can do as well in 2009 as it did in 2008. When the housing starts, let’s say they were off 10%, we wouldn’t care but when you have the kind of fall off that you have in housing starts it might result in several hundred thousand fewer water meter sales with some networking associated because many of those are in communities that would be frankly more advanced in terms of AMR then others. So that has to hurt us somewhat. I think we’ve got a risk of certainly being down enough that it puts a drag on what 2009 can do and its got to be made up from the rest of our businesses. But we’re not seeing any, its not a severely challenging environment but its not only an absence of growth for 2009 it will drag down the company a bit. It could put a 1% drag on the company’s organic growth for the year maybe. But I wouldn’t overly focus on Neptune. We actually had a record fourth quarter for any fourth quarter in our history and Neptune certainly wasn’t a huge part of the fourth quarter.

In industrial, orders were down 9% in that segment during Q4, I’m curious if you broke apart Neptune versus the sides of the segment, were they down in equal amounts, that 9% in orders or—

I do want to make sure that everybody knows that the industrial businesses through the first nine months really did exceptionally well and they helped Neptune. Neptune wasn’t the sole driver of industrial performance. It was strong in the first half of the year, not as strong in the second. And then the turnaround in Q4 was largely driven by currency and situations that had [inaudible] with the kind of customers they have.

The order rate was about the same for the non-Neptune businesses as per Neptune, kind of down in the 7% to 9% range for both groups of companies. On the revenue side actually the non-Neptune side continued to grow in the fourth quarter, in the mid single-digit range. So it continued to respond well and continue to service those customers but the order rate clearly slowed down hence the reason we’re looking at some restructuring actions there.

On the copper hedges which I presume copper and steel for that matter I presume they impact industrial tech the most, how far are you hedged and or forward bought and when do you really start to see spot prices benefit this segment.

In terms of Neptune we won’t really get a benefit unfortunately until the second half of the year on copper. There get a fall off so you don’t have quite as much through put absorption of the tonnage and the Canadian contract which is basically locked in because of the way its negotiated not happening will preclude them from seeing the benefit in costs until the second half of the year but it will start to help us in the second half.

Your next question comes from the line of Shannon O’Callaghan – Barclays Capital Shannon O’Callaghan – Barclays Capital : Just looking at some of the things that happened in December and thinking about next year, orders are down 4% organically so the guidance assumes for next year we’re no worse then that, what things get better from here do you think.

I’m not sure we’re counting on a dramatic improvement in the economic condition. I think we understand the economy. Its not very good right now and we don’t, we’re not looking for a huge improvement in the second half. But on the other hand we do have some of our businesses with very good visibility particularly in the RF side around transportation solutions and projects that are already booked and underway as well as the rollover effect for some of the acquisitions around the CBORD and Horizon and the growth objectives that they have there. At some point here during 2009 those will actually fall into organic growth instead of just growing against what their pro forma numbers were before we acquired them. So those I think will be positives. In our imaging segment that area is once again largely NIH funding and other types of R&D funding levels drive the ultimate end market demand there combined with new product introduction. We have some very good new products that are available and we’re excited about the opportunities there. We do look forward to having some of those R&D monies freed up and start to flow out to the research institutes and we’ll be able to serve them accordingly. Shannon O’Callaghan – Barclays Capital : What about stimulus, you mentioned that a couple of times, have you assumed any benefit in your plan and aside from that, what kind of potential things are you hearing about or thinking about.

We’ve assumed no benefit from the stimulus plan. I can assure you. Right now since people talk about it and don’t execute against it, it’s a negative. If somebody will do something about it then we’ll determine whether there’s anything really positive or not but just whatever a decision is will allow other people to go ahead and execute so that will be beneficial. Its just common sense would say that the CBORD and Horizon platform we have in the school situation could be benefited from the kind of things that some people want to put into the stimulus, so that would be beneficial. Certainly if you got infrastructure building, first stimulus package was exceptionally tepid in terms of what’s truly going into infrastructure for roads that a lot of indications would be there’d be more available for that, if there’s more available for that then people are going to want design work that we tend to provide at a faster clip. Unfortunately these things really aren’t shovel ready, they take a longer time but we’re part of the people that would maybe get involved early in those things while people are getting ready to use the shovels later. So that could help a little bit. But I don’t think Roper is really a play one way or the other on whatever stimulus program ultimately is passed this evening or next week or any other time. But its certainly not a negative for us, its probably a modest net positive. Shannon O’Callaghan – Barclays Capital : Can you talk a bit about pricing, you mentioned you have raws coming down, it will take a while to benefit from that, how do you think about the pricing across your set of businesses and are you seeing any kind of pressure on that yet.

No not at all, every single segment expanded gross margins last year. We don’t see that. We have very few standard products. Pretty much everything is built to customer order. Our businesses are largely driven by application engineering with a bit of refinement so people are generally making decisions about the value of what they’re acquiring and since you don’t really have much standard product if you will, hard to measure pricing effectiveness but a simple way is to look at whether gross margins are going down or up and they are holding steady to going up so we don’t see price as a problem.

Your next question comes from the line of Jeffrey Sprague - Citigroup

What do you think about the use of the balance sheet in this environment. I think in the past you expressed comfort with 2.5 turns on the EBITDA but maybe a flex up to 3 for the right deal, or even a bit above with the visibility to drive it back down, is that still operative in this environment or are the rating agencies such that, or internally your own concerns such that you wouldn’t really take it that far.

We would not have any qualms going to say 2.75, it would have to be one heck of a deal to get us to go up to 3 but I would say one of the things that works in our favor, just look at the Q4 cash and the difficult period includes paying for a little restructuring and we’ll still have we think really outstanding cash so I don’t think there’s any constrain about that. We entered the year with about $700 million in kind of powder that we would have before you’d need any new debt anyway and we’re going to throw off cash, we’re already throwing off cash, so we don’t really see a problem around that. And certainly purchase multiples are coming down and but if I were modeling, I would assume they’re likely to invest $4 or $500 million, maybe they’ll do $700 million. It really just depends, we’re going to maintain our discipline around the transactions. There are things that didn’t used to happen that are out there that we thought might happen that are really there now because you have a lot of good companies that are in distressed debt situations. And we’re spending as much time talking to private equity types around their problems as we are talking to people about actual deals. So I don’t know how those ultimately end up but there’s some pretty attractive situations that are emerging there.

Can you give us a sense on CBORD and Horizon and maybe Technolog, what was the pro forma organic growth profile of what you acquired in 2008 and, assume you maybe had some cash accretion from CBORD but did you actually have EPS dilution from those deals in 2008.

No we didn’t have any EPS dilution from anything. You might argue that while we did the $500 bond and it had a 6 5/8 coupon so that interest cost was more, if you took the Q4 interest cost on an annualized basis or something, but that’s dangerous because we draw out cash. I think we’ve said routinely that those businesses were growing in excess of 10% organically. In fact they did grow more then that and we expect them to grow at least that much in 2009.

On the restructuring given that you’re such a cash focused company, why are you bothering calling out a few pennies of restructuring here and there.

I’ll tell you why, because a whole lot of other people who are not paying as much attention to cash machine we have occasionally challenge us and say you’re not doing any restructuring, look at this guy, took $50 million, this guy took this, this guy took that, they’re going to take more. Part of the reason that we include it in these slides, the awareness, please look at the gross fixed asset comparisons of these companies and what Roper is and how special it is and we’re tired of people saying why don’t you do something. We’ve done precisely the right thing at precisely the right time in the fourth quarter. We’ll do it a bit more in the first quarter and we’ll do a bit more in the second quarter depending on the kind of constraints that those businesses have. They all have their plans in place. We’ve already had a call off of what’s the last two weeks look like so that’s why. I think people want to know if we are doing restructuring, how much we’re doing and we’re trying to be transparent about it.

Your next question comes from the line of Wendy Caplan - Wachovia Securities

You said that your restructuring could go into this current half, mostly headcount or should we expect any consolidation, what are the plans.

Mostly headcount, I think that there are a few places that we really would be able to consolidate if we wanted to. But if end markets were to continue to deteriorate in the industrial arena there might be a couple of things that we could consider. We might have one division in-source in other divisions work and back away from the assembly that that division did. That’s certainly in our contingency planning. Its not warranted yet but if you had a deeper dive and fall off in demand, those are the kind of things that we have available to do if it made sense.

You spoke a lot about the translational impact of currency and what you’re expecting in 2009, have you seen any impact from the transactional impact of the stronger dollar?

No, honestly and its what’s difficult for us, we’re very well matched on a global basis and so if the stated currency is down 4% on $2.3 billion, that’s $92 million and it’ll deleverage at the same rate as though it was an operating number. It doesn’t have a decrimental deleveraging effect that deals with absorption issues and contribution margins, it delevers at the same ratio so if its down 20 or 25% because that’s the kind of business it is, that’s how it shows up. So you could have the same level of efficiency and effectiveness and it could have as much as a $0.20 drain on our earnings per share in 2009 purely from currency having nothing to do with end markets. So we expect it in 2009 as we went through the fourth quarter that RF and some turnaround benefits we’re getting and the medical and scientific imaging would be able to offset industrial and energy and then the depth of what happened in the industrial sensor business and the refining business made us worry to the point where we said, well you know we think it should largely mitigate it if we’re lucky it will actually offset it. But maybe we’ll have low single-digit negative organic growth because of the depth of the industrial and energy end market challenges. And then that left us open to an exposure only related to currency translation.

You mentioned the decision making, the slowness on the part of your customers, how would you characterize the existing business in terms of are we seeing a significant number of customer delays, any cancellations, are your customers revisiting price.

We have sort of stepped up, we put a number of new call systems in place where we’re involved very frequently. The activity that our divisions have and their quotation indices and everything else is not [inaudible]. The activity level is as good as it was before but the commitments are slower and so we remain cautious because our fear would be that its just going to take a longer time for people to commit and that’s what worries us. We’re not seeing any cancellations, we’re not seeing price difficulties.

The hit that you took in the second quarter of 2008 on Neptune relative to the repair cost to the vendor’s components, have you received any of that $3.5 million back yet, can you give us an update on that.

First as far as the reserve that we took, we’ve spent about 85 or 90% of that so we’re almost completely complete with that repair and fix activity. As far as the vendor and the negotiations, no we have not received any of that yet. We have come to a framework for a, come to an agreement in principal with the supplier that will result in slightly lower prices over the next two to three years or so that will just run through as lower cost of goods sold for the Neptune business.

Your next question comes from the line of Matt Summerville - Keybanc

On the imaging business in the fourth quarter I think your operating margins were 22% which is the best performance that segment has had in a couple of years, first can you talk about how much of that is mix related and how sustainable is that if you think your medical and life sciences businesses will on a relative basis at least outperform in 2009.

Part of it is they’re growing faster then the others so there is a natural mix gain you get with that. We had really, from the first part of the year what happened is a couple of businesses had arrangements with customers, they had made some expensive investments in specific R&D without getting the right kind of assurances and the customers didn’t follow through in the timelines that they thought they would and so it depressed margins because you had no revenue matching up against the R&D costs. And it wasn’t billable in any way so we have taken some actions in those businesses around restructuring which we never really even talked about, they’re just all done and we made some management changes and have done things all of which are beneficial. We got some new leadership that’s doing a better job. We’ve got better focus. In the first part of the year there was a concept called Mag and people trying to put some things together and we didn’t think that was in the best interest of things and unfortunately we were proven right and so we had wound that. Now you’ve got the focus back and things look better and the business could do better in 2009 especially with this NIH funding initiative that people are talking about. And then the challenge would be if the industrial side was worse. I mean those businesses, the industrial camera stuff, a lot of that is used in flat panel inspection and that business is on its worst possible legs and so the rest of it has to offset that and we think it will.

On energy, I think you talked about in the third quarter seeing some pretty meaningful push out with [Vteck] what the timing of that’s going to look like if you saw any of that in the fourth quarter whether that’s 2009 and just more broadly on energy, you tend to talk about things around safety environmental regulation, productivity improvement really driving the business, outside some of the macro things going on, I’m trying to get a sense for how much of your energy business do you feel is really well insulated from the macro cross currents right now.

Around Vteck, you’re right the push outs happened in the third quarter and we didn’t really expect them in the fourth quarter and they should hit sometime in the first half of 2009. We have largely been insulated and really haven’t had very much correlation to what the overall oil price has been. But on the other hand the end markets that are served by particularly around refinery and petrochemical for them its not around whether they want to invest in new productivity solutions or compliance with regulations, those folks just shut their plants down. And as a result they weren’t buying anything and so what normally would have been a very strong fourth quarter and historically has been a very strong fourth quarter for some of those businesses as folks flushed out their annual operating budget not only did they not flush out their operating budget, they didn’t even do their normal level of activity. So I think once folks get back to actually running their plants, then they’ll start looking at ways to either become more efficient or to comply with whatever regulations that may be out there. We have some activity underway with some of the regulatory bodies in California that could have some very good tailwinds but that probably won’t happen until 2010 or beyond but there’s good conversations there.

There are no additional questions at this time; I would like to turn it back over to management for any additional or closing comments.

Thank you all for joining us today and we look forward to talking to you as we finish the first quarter in a couple of months.