Good morning, my name is Molly and I will be your conference operator today. At this time I would like to welcome everyone to The Black and Decker First Quarter 2009 Earnings Conference Call. (Operator Instructions) I would now like to turn the conference to Mark Rothleitner, Vice President, Investor Relations and Treasurer. Please go ahead, sir.

Thank you, operator. Good morning and welcome to Black and Decker’s First Quarter Conference Call. On today’s call our Chief Financial Officer Steve Reeves and I will discuss our first quarter results and outlook for the remainder of 2009. Our comments should take about 15 minutes and then we will answer your questions. In keeping with SEC requirements I want to advise you that during this call we will be making forward-looking statements that involve risks and uncertainties. For a more detailed discussion of the risks and uncertainties that may affect The Black and Decker Corporation please review the reports we have filed with the SEC including the 8-K filed today. In addition, we will be referring to non-GAAP financial measures within the meaning of SEC Reg G. A reconciliation of the differences between these measures with the most directly comparable financial measures calculated in accordance with GAAP is included on the Corporations website under the Investor Relation section. Now I will turn it over to Steve.

Thanks Mark. This morning Black and Decker announced earnings per share of $0.08 for the first quarter or $0.22 excluding restructuring charges. This is slightly better than our guidance despite an economic environment that was even weaker than we anticipated. We have taken a series of aggressive steps to reduce costs, enabling us to remain profitable even in the worst economic downturn we’ve ever seen. Sales decreased 28% including a 5% unfavorable impact from currency translation. In January we gave sales guidance for a decline of approximately 20% in the first quarter, however sales in our European Power Tool business and Fastening segment were well below our estimate. We saw rapid deterioration in Europe and the automotive industry late in 2008 and another step down this quarter. Our pre restructuring operating margins decreased to 3.5% primarily due to lower sales volume. Importantly however, margins were better than the 2% we projected. We stayed disciplined on price which contributed 1% to sales and helped our gross margin. In addition, we reduced SG&A expense by 23% a significant improvement versus last year. While some of this does reflect currency translation we have meaningfully change our fixed cost base over the last six quarters. We also remain well positioned in terms of liquidity and cash flow. As expected, free cash flow as significantly negative due to typical first quarter working capital needs as well as the accounting treatment of currency hedging that we discussed in January. Including cash flows from net investment hedging activities net cash generation was negative at $123 million versus -$71 million in the first quarter of 2008. This decline was driven by lower earnings as the change in working capital and capital expenditures were similar to the prior year. Now let me discuss our business segments. Sales in our…

Thanks Steve. Our balance sheet remains in good shape and we expect cash flow will remain solid despite the challenging environment. As Steve mentioned, net cash generation was negative $123 million for the quarter due to seasonal working capital needs. We expected a number in this ballpark and are still on track to generate cash in excess of earnings for the year. Inventory decreased 17% year-on-year which we consider good progress in light of the weaker than expected sales. We also reduced capital expenditures roughly 20% and expect a similar trend the rest of the year. Due to negative cash generation in the regular dividend payment net debt increased $149 million during the quarter; however, consistent with our January projection we expect net debt will be down modestly for the full year. Shortly after the end of the quarter we issued $350 million of senior notes due in 2014. Over the past year we have taken steps to shift from short-term to long-term debt, maintaining a conservative position during the financial crisis. The bond offering was a continuation of this strategy. The bond market has been very unpredictable since September, so we took advantage of a favorable opportunity to issue in early April. As a result, we have no long-term debt maturities until 2011 and nearly all of our $1 billion short-term credit facility is available. However, our 2009 interest expense will increase by roughly $18 million versus our previous guidance, almost entirely due to the bonds. Our past employment priority remains net debt reduction and we continue to look at small bolt on acquisitions. Our share repurchases also remain on hold. Now I will turn it back to Steve to discuss the outlook for the rest of 2009.

Thanks Mark. Before I discuss our 2009 outlook, I would like to note that next week, at its scheduled meeting, our board will address our dividend. As we discussed in January, we will evaluate our dividend pay out in relation to our current profitability, cash flow, and general economic environment, and make a decision based on the best long-term interests of the Company and its stockholders. Looking forward to the balance of the year most of the end market factors that caused the weak demand in the first quarter are expected to continue. The housing, non-residential construction, and automotive industries remain depressed. General economic conditions are still poor in Europe and decelerating in other regions. While most inventory corrections occurred in the first quarter for the Power Tools and the International Fastening businesses, we expect further actions in the second quarter in selected areas. As a result, for the second quarter we expect sales will decrease at a rate similar to the first quarter. This includes approximately 7 points of unfavorable currency as we comp against last years weakening dollar. The percentage declines should then narrow somewhat, particularly in the fourth quarter, as we anniversary the step change in the global economy. For the year we expect a sales decline of approximately 20% including 5 points of unfavorable currency. As always, we are introducing great new products, such as the updated XRP cordless and additional tools in the Porter-Cable line. However, we also recognize that the weak economy limits the upside from these launches. On the cost side deleveraging will continue to pressure our margins, component costs will remain unfavorable next quarter, and due to lower volumes the benefit of commodity deflation will be slower to work through the supply chain. The first quarter restructuring action should result in at…

(Operator Instructions) Your first question comes from David Goldberg with UBS.

Good morning it is actually Susan for David. I just want to know if you can discuss what you’re seeing in terms of the health of some of your smaller independent retailers. It seems like a fair amount of the decline that you’ve seen this quarter came from some changes there. I’m just wondering what you’re seeing overall.

Sure well you know some of our independent customers are clearly hurting with this economic downturn. We work with them to manage their credit limits appropriately. We have not seen any significant bankruptcies or anything along those lines in the independent channel, but we are cautious and monitoring that situation closely.

Okay and so should you kind of see more of a shift towards the big box retailers, what do you think the impact could be in terms of maybe some of the pricing. I know you expect pricing to be slightly positive for this year, but how is that taking into account the kind of sale mix that you’re seeing?

If you question is relative to price, we have, as we indicated previously toward the end of last year, worked through price increases in most of our businesses on a number of our lines and those are holding up through this year. I think outside the US, with the currency situation the way it is, there is an opportunity for currency reasons to be able to take price in some markets going forward through the rest of this year. I think that’s factored into the mix shift that you’re referring to.

Okay and then just one more question. In terms of the lead times, it seems like your lead times might be getting a little bit longer given the fact that things are slowing so dramatically. Do you expect any changes in your working capital trends as we go through the year?

As I mentioned in the prepared remarks, our intention is to take a significant reduction in our inventories in the second quarter to get them in line with the demand environments we see going forward. So, I would say that you would expect to see some further production cuts in the second quarter, inventory coming out, payable will stay down with that. Then as we match production to sell out in the back half of the year you should see the payable trend come back and capture the cash in the current year.

Okay thank you.

Your next question comes from Michael Rehaut with J.P. Morgan.

I would like to get a little better sense of your expectations for component costs, which has been pretty volatile over the last 12 months. You mentioned that you expect the component costs to be higher year-over-year in Q2. Could you just give us an update in terms of what you laid out last quarter for the full year, positive or negative, on an overall basis, and if your expectations for the back half have changed at all as part of your updated guidance.

Not materially. I think we guided that inflation would be negative for the full year, which is still our expectation. That it would be more negative in the front half as we carried in from current inflation from last year and as it takes a period for some of our contracts to reset. That is still true. As the year progressed you would start to see the benefits of the deflation that has been occurring since the economic slow down. With lower volumes it will take a little longer to get that to work through the supply chain as we have less volume to push through. But, not a material change relative to the full year outlook.

Just to kind of reiterate, if I could get a little bit better feel for the inventory corrections. Then maybe that can tie into my third question which is pricing and your outlook for pricing. With demand where it is and certainly the big retailers continue to be very aggressive on inventory levels, as you have noted, can you reconcile that with your outlook for still positive price? I know you just kind of gave some comments, but particularly in the US. You also noted that the reception might be more muted on some of your new products because of just where we are in the demand cycle. It seems like there is this conflict in terms of very weak demand and perhaps, as you also mentioned, weak demand that is resulting in a negative mix shift. How are you able to reconcile that with your outlook for pricing, not to get on the margin worse from current levels?

Sure, that was a long question. I will take a stab at answering it and if I miss something let me know. Our pricing forecast is not a function of being able to take price in the US going forward. I think it’s, as I mentioned, us holding onto the price that we negotiated last year. As you see a shift down in price points, which occurs in some of our categories, buyers are shifting down and at this point in time we have, say from a DEWALT we can shift down to Porter-Cable and Black and Decker. I don’t know that that is in our interest and so I chased the DEWALT pricing down to get that user as he’s stepping down to a different value proposition.

And a lot of the pricing, Mike, is not in the United States. We’ve got different abilities and it’s more of a rifle shot. So really what we are looking at is the performance in the quarter was a little bit better, so we expect that the performance on the full year, from a pricing perspective, will continue to be a little bit better than our original estimate. But, this is not a big change, this is a very modest change in our outlook to outlook.

Can you comment on your views of whether or not you held gain, or lost share, in your DEWALT line in the first quarter?

It’s really hard to do share count on a quarter-over-quarter basis. There is an awful lot of noise in that. I think in our last call we indicated that we were losing some share on the cordless side of DEWALT as the market shifted to lithium and I think that trend has continued.

Thank you.

Your next question comes from Nishu Sood with Deutsche Bank Securities.

The first thing I wanted to ask you about was the Fastening and Assembly business. The exposure, as you mentioned, substantially to the automotive industry. The automotive industry has been suffering for a while. Sales had held up a little bit better there, I think partly because of an international mix issue. I’m just trying to understand the sensitivity to the industry and why sales would have just fallen off a cliff there. In particular I was looking to understand how much this has to do with the distress at the US automakers; along those lines, if it is related to a potential bankruptcy or more than one bankruptcy how would that affect it further going forward?

I think, as you look back over time our Fastening business, the majority of it, is outside the US. I think you would have seen the Asian and the European automakers even having been performing reasonably well, you are right that the automotive industry has been depressed for some amount of time. What I feel we saw in the first quarter was that as a global statement the automotive companies slowed down because their finished goods inventories had built up. So, you saw the Asian and the European automakers take production out to get their inventories back in line with historical trends. I think that occurred largely in the first quarter, and so we should be pacing with sales going forward. I think in the US, while there was an attempt to get their inventories in line, I don’t think, at least the domestic aspects of the US automotive market did not achieve that goal, and there is still some substantial overhang in inventory in North America. But, I think that as you look at the bigger part of our business, which is outside of the US, their inventories are back largely in line with where they want them to be. If in fact we lose GM and Chrysler through this downturn people will still buy the same number of cars and so we supply to virtually the entire industry, so the exact effect will be dependant upon the individual company that picks up the sales ultimately, because we will have different penetrations in different places, but people will still buy the same number of cars, even if those two go bankrupt.

That’s very helpful. The next question I wanted to ask was kind of a bigger picture question. The last couple of years has just seen one shoe drop after the other, housing, non-residential, your sales in Europe, now fastening and assembly. So, what is left that could go wrong here? As I look across your sales Latin America still seems to be holding up a little bit better than elsewhere, but I guess, what else is there beyond that that could fall apart here in the coming quarters?

You are right; it has been a challenging environment. If you were to look at the risks, it is how far down is industrial and commercial construction going to go? I mean it is off significantly. When will that rebound? All of the sectors, as you pointed out, are down, and have gone through some cataclysmic changes, so I don’t think there are any particular areas that have been left untouched by the economic downturn.

The debt rising, I’m just trying to understand the rationale here. You have used maybe $200 or $300 million out of your billion capacity. Nowhere close to the full capacity. You are only pushing out your maturity by, I think, two years here, because I think your revolver expired in 2012, assuming it couldn’t be renewed or extended, and it is coming at a pretty significant cost. I was just wondering, I understand your desire to be conservative, but it seems like a pretty high cost to pay for the extension of liquidity you’re getting.

Well, hopefully everything turns around and the worlds good and maybe it will prove to be a mistake, but I think with the uncertainty in the marketplace right now and the rating changes that we incurred in the first quarter, which limited our ability to access commercial paper, it is prudent to lock in extra liquidity at this point in time.

Okay, thanks a lot.

Your next question comes from Daniel Oppenheim with Credit Suisse.

I was wondering if you can talk a little bit about pricing volumes. You talked about the price being better than you expected this quarter. It seems as though you are favoring price over volume. As you talked about the second half of the year expecting some recovery based on the easier comparisons there, should we expect substantially more use of discounts there should the sales not recover as expected?

I think you only want us to use price if we’re really going to drive volume with it. I think we’ve incurred a fair amount of commodity costs and we’re going to try and hold onto the pricing that we’ve gotten, would be my observation as we go forward. We will deal with each intentional action on a case-by-case basis and where the right cost benefit is. But, our expectation now is that we will not.

I am also wondering, you talked about the favorable legal environments to expenses. How material was that this quarter?

The favorable legal environment was a little over $6 million.

Great, thanks very much.

Your next question comes from Kenneth Zener - Macquarie Capital.

I was wondering if you could give us a little feel for the quarter. When you guys reported at the end of January you were looking for down 20% for the quarter. It came in at about down 27%, 28%. It seems that the quarter has deteriorated substantially, probably 30% declines in those overall in the last two months. Can you talk about the trends that you saw, and given that significant weakness, how you were able to offset? I would like a little more detail, really, on the operating leverage that’s embedded in the business given that it deteriorated so significantly.

I think as we saw the volume not coming back and it’s hard to get into a month by month comparison, but we took the effort to do this initial restructuring charge to try and get our costs in line both on the manufacturing side as well as in SG&A and just to clamp down on all discretionary spending. As we noted, we asked our employees to take a scaled pay cut for the balance of the year as well. It’s really not a lot more complicated than that. Those are the broad actions we took.

Okay so you’re saying that when you guys were expecting 20%, did it deteriorate, because that was already one month into the quarter.

Yes it did. I think as we were providing our guidance for the first quarter back in January, and January is a very small month and it is hard to draw a lot of conclusions from that month. But, we were forecasting, say on the Fastening side, a much different automotive production level and the production just did not come back as fast as we had anticipated it would. And we saw further deterioration in Europe than what we were expecting.

Okay so focusing on Europe where that went down largely on the professional side. Could you give us just a feel for how much of that split between the pro versus the consumer in terms of exposure to that market on a dollar basis, as well a the margins. I think in the past you guys have said it’s been fairly equal between the pro and consumer over in Europe. If you could update us where that is in terms of the margin spread between those businesses.

The revenue split is roughly equal. We have not historically provided profitability detail at that level and I’m not going to at this point in time. In total we are deleveraging in Europe as the sales drop there. It is a reasonably high fixed cost business, so our margins are off relative to what they have historically been.

But, you are saying it really was the pro that fell, not as much as the consumer. I mean was it kind of half the magnitude?

They were both down. Pro was down substantially more than the consumer business was. I suspect related to the commercial construction.

Thank you.

Your next question comes from Sam Darkatsh with Raymond James.

Can you talk about specifically in PTA and HHI what sell through was in terms of could you quantify what the rationalization efforts of the retailers taking out their inventories might have contributed?

Sure. I think in PT&A we saw kind of mid-teens sell through declines and in HHI, I am trying to remember off the top of my head here, I think it was down slightly less than that is my recollection.

When you refer to pricing expecting to be positive for the year, is that ASP which would include mix, or is that like for like pricing that you’re referring to?

Like for like.

Like for like pricing, so would mix be a detriment, would it be a favorable all in including mix within mix? How should we look at mix?

Well mix is in some ways it’s all other, but as we move between price points, profitability changes not always in the way you’d expect. So, I think it is our current forecast that we’re going to mix down on profitability perspective based on what where we think the sales are going to occur.

Should we factor that in from a modeling standpoint or is it just real, real modest, or mild expectations?

It is a very modest expectation, so I wouldn’t consider it to be material at all.

Okay and as it relates to the definition of your debt covenants should we back out the favorable ruling and also the restructuring expenses from your EBITDA when we’re calculating the fund of that to EBITDA ratio?

Generally we would not adjust for sort of normal C&A adjustments, favorable or unfavorable items. Obviously the environmental charge, the large one that we took back in the fourth quarter of 2007, we did adjust for, but no, the normal quarterly changes in legal and in environmental we would not adjust for. We would adjust for the restructuring.

So we would back the restructuring out? So, the EBITDA would include the $12 million or would not include the $12 million?

EBITDA would not include the $12 million charge or we would add it back.

I got it, but then it does include the $6 million from the favorable ruling?

It is included in NOI and that is all the other costs, positive and negative are included. That is neither large enough nor unusual. We get a lot of settlements through out the year on that kind of stuff. The one we did carve out was the large environmental one a year and change ago.

All right, thank you very much gentlemen.

Your next question comes from David Macgregor with Longbow Research.

Just looking at your guidance of $150 to $190, you’ve got revenue guidance of down 20 including -5 on the currency. I was just wondering, it was quite a range at the EPS line given a 20% forecast down at the top line. How much variability is there in that 20% top line guidance? Also, maybe to the extent that there isn’t as much variability in your thought there, can you talk about the opportunity to get costs down further as an earnings driver over and above the $75 million restructuring benefits?

Sure. It’s a very difficult forecasting environment, so I don’t think we mean it to be precise. I think what we’ve tried to capture is the current run rates that we’re seeing and provide an allowance for where we think things are going to climb further in coming up with that 20%. It is not a precise calculation by any means, so there will be variability in that. We are working on what our contingency plans are relative to any further step down in demand that’s significant. As you can imagine this far into a cost cutting initiative, it gets harder and harder as we go along, but there is always opportunity and we are working through what leverage we might pull, if in fact we do see a further deterioration in the top line.

Are we talking about fixed costs primarily in that contingency plan?

Depends what you mean by fixed costs, but yes. Generally speaking, yes.

You mentioned last quarter you got some hedges coming off here and that you were expecting some relief in the second half from that. At that time copper was $150, now it’s $210 it is up 40% and a number of other commodities have started to move as well. I’m just wondering if maybe that opportunity on the variable cost side is less than what you though it might be. I guess I’m just trying to size up what the cost reduction opportunity might be from this point forward beyond the $75 million.

We’re still working through our plans. I couldn’t give you another number. We will react as we see demand tail off as we have through out this downturn.

Yes, I mean you have seen us, David, take a number of actions through out the last six quarters. So, you can appreciate that we continue to look at what costs we might be able to eliminate if things do not hit the guidance or the expectations that we have. So, we certainly do not want to telegraph what those items are, but certainly we’ve got to look at contingency plans if we don’t achieve the top line numbers that we have now built in, the new reduced top line numbers that we have built into the guidance.

Okay good. My second question is just on the Power Tool business. You mentioned your consolidated pricing was, I think, up 1%. Is there any chance you could give us a little more feel for what it might have been just in the PT&A?

No, I don’t want to split it out in that level of detail.

Your next question comes from Dennis McGill with Zelman and Associates

My first question just has to do with the sales guidance. I appreciate that you said it is on a specific target and I understand the variability there, but when you think about the first half of the year versus the second half of the year, it sounded based on the financing decisions you guys made to that markets that you appreciate the significant amount of uncertainty in the marketplace and are being cautious there. But, the guidance would imply that you’re going to see significantly less negative results in the back half of the year. I was hoping that maybe you could just talk through some of the bigger level of assumptions by end channel on where you could see things get at least less negative as we move into the second half.

Sure. I think the biggest change as you look at it on a year-over-year comparison is the comp to the step down that we saw in the fourth quarter of last year. We’re still calling the fourth quarter down, but not at the same level of decline often already reduced number. Additionally you, especially when you get to the fourth quarter, you start to anniversary the significant strengthening of the dollar that we saw last September. So currency, once you get out to the fourth quarter, is flat to maybe just slightly negative. I think it is more of a comparison issue. We are not seeing signs of recovery in the business at this point in time.

It is just easier comps as the quarters roll by.

Okay so fundamentally you see the last couple quarters of the year kind of similar to what, at least the current quarter, is looking like for Q2.

Yes there was some inventory adjustments that are occurring in the first quarter, probably will spill over into the second quarter here. But, for all material purposes it is a comp issue that you’re seeing there.

Okay and then that leads into my second question on the inventory front, kind of two parts. First you mentioned bringing down production second quarter. Could you talk about which segments you are seeing that primarily in where we will see under absorption? Then kind of similarly, the revenue declines in Europe sounded like they were certainly more than expected and quite large, obviously, on the pro side. Are you guys seeing any inventory problems there?

Do you mean with respect to our inventory? We are going to bring production down actually in all three of the segments. It is probably most significant in the Power Tool business, but we have plans in place and we’ll execute that and then we will take the absorption medicine here in the second quarter and hopefully match reduction with sell out as we go through the balance of the year.

As it relates to the [inaudible] inventory is there any more or less build there relative to the domestic?

No, it is pretty similar.

Then my last question, I would appreciate as much help as you can give me here. As we think about the SG&A number year-over-year I guess it was down somewhere around $90 million. Can you talk through how much of that would be variable and then of the fixed reductions kind of the key components outside of salaries or payroll reductions?

We reduced spending virtually everywhere. We had the restructuring benefits that we’ve undertaken over the course of the last year as well as, well actually our salary reductions really don’t take affect until the second quarter, but it is predominantly the restructuring actions taken through out the course of 2008 as well as just a clamp down on discretionary spending through the quarter which will carry over through the year.

Of that discretionary side, how much of that would relate to things that would be product related, whether it’s advertising, R&D, marketing.

We have cut back on promotion and marketing. What we have left intact largely is our R&D, our new product development activities have largely been untouched through these restructuring actions as we work through.

Is there a rough number you could give me, as far as a reduction, how much of that would be a fixed reduction?

Do you mean in terms of the decline? Obviously transportation would have been largely volume driven. There may be some other distribution expenses that would be largely volume driven, but most of the other expenses are probably, except for perhaps some element of compensation, would be fixed costs.

All right, thanks a lot guys.

Your next question comes from Eric Bosshard with Cleveland Research Company.

First of all, in reducing the sales outlook by about 10% and the earnings outlook is not really that much different than your original guidance, excluding the interest expense, perhaps $0.10 difference. It doesn’t seem like the detrimental margin is much up. Could you just talk a little bit more through how such a significant reduction in sales is not translated into that much on the bottom line?

Sure. I think if you think about it you will split the sale take down in two parts. There is the organic take down, which you would expect. Historically we’ve seen kind of a 25% to 35% read through on that, which is not inconsistent with what we’re expecting. And you have a currency take down, which typically is not dragged with it much in the way of earnings and it is not dragging much with it this time either. So if you bifurcate the sale take down into those components, we are able to offset that with the incremental restructuring actions, the other personnel actions that we’ve spoken to, as well as other non-employee related SG&A actions as we go through. Then you have the slight over drive that we had in the first quarter is different, the main components along with the favorable pricing that we spoke to earlier.

Within the expense reductions that you’re taking here, when sales turn around will you have to reinvest incrementally, or are there things that you pulled out that you clearly have to put money back into on the way up or will you be able to sustain this cost structure and allow the margins and the up side to flow through it at a pretty rapid pace?

I think in terms of the cost reduction activities, I think if we saw a material up turn in the business we certainly would think about reinstating salaries. But, in terms of the actual head count actions that we’ve taken, it is probably more on the permanent side that we won’t be adding back positions and you should see pretty good operating leverage on this business when the economy turns around and we start to get some sales growth.

It appears that the home centers have chosen to promote some of the categories a bit more than power tools, at least relative to a year ago. Is there any influence on what’s going on with pricing in your business related to how the home centers are behaving differently with your category?

No not particularly. You are right that the promotion activity is down in certain places relative to where they were last year. But, that is not a particularly big part of the pricing activity.

Someone asked you earlier about market share and power tools and I know it’s not a perfect science of how you’re doing. But, at what point and for what reason do you think you will be able to get back to holding or improving your market share in the power tool business?

Generally in most categories we are holding our share and doing reasonably well. I think our particular issue is around the cordless and the chemistry transition and our product road is certainly focused on addressing that and you will see us continue to evolve our lithium platform and our new product launches as we go out of 2009 and into 2010.

Thank you.

Your next question comes from Peter Lisnic - Robert W. Baird. Peter Lisnic - Robert W. Baird & Co., Inc. : If we look at the down 20% that you’re looking at, can you maybe give us a sense as to back half of the year for US based businesses versus Europe? It sounds like that European Power Tools business, especially in the eastern parts of the country, could be suffering some pretty significant declines even going through the back half of this year and probably into 2010. So I would appreciate some color on how you think about geographic guidance relative to that down 20%.

I think that if you stick specifically to the Power Tool business, I think our outlook on Europe is probably a little worse than the total corporation. Our expectation would be that the automotive business in Europe will recover faster than the US business will. So, it is really a function of which segment you’re speaking to. I think Eastern Europe’s problems will be with us for quite awhile there. They are most acute in the far eastern part of Russia and Ukraine and the availability of credit in those markets is very limited and it’s difficult to see how that is going to change. Peter Lisnic - Robert W. Baird & Co., Inc. : Okay and then competitively the share conversations we have been having. Is it the same case in Europe as well?

Yes, it would be. Peter Lisnic - Robert W. Baird & Co., Inc. : Okay great and then just to tie up the cash flow forecast a bit. CapEx around 80ish is my read right on that?

Yes, 80, 85, in that range. Peter Lisnic - Robert W. Baird & Co., Inc. : Okay and then I just want to make sure I’m clear on this, because we’ve talked about it in the past, but in terms of the hedging, the net cash impact for the year would be around neutral. Is that the right way to think continue to think about that?

Yes, neutral, maybe slightly positive. It depends obviously on where rates go from here, but it could be a slight positive for us. Peter Lisnic - Robert W. Baird & Co., Inc. : Okay, then on materials costs, I may have missed this, but in the K, I think you were talking about a number of around $50 million of impact for the year. Is it still the same sort of ballpark?

Yes. There is really no material change in our expectations there. Peter Lisnic - Robert W. Baird & Co., Inc. : Okay, great. Thank you very much for your help.

Your next question comes from Seth Weber with Bank of America/Merrill Lynch. Seth Weber - Bank of America/Merrill Lynch : If we are looking at another 30% decline in the fastening business, do you think that that business stays profitable through out each quarter for the year?

Do you mean another 30% oh top of where we are now? Seth Weber - Bank of America/Merrill Lynch : No, I mean another year-over-year 30% decline.

I think that yes, I do. I think that that is probably a pessimistic look, but I do believe it will be profitable even at that level.

They’ve taken a lot of costs out there as well. Seth Weber - Bank of America/Merrill Lynch : Okay and just kind of a housekeeping issue. Is there a number that we should think about for the corporate expense for the full year including the first quarter number?

I think for each of the quarters going out you should think about $16 million a quarter for quarters two through three. Seth Weber - Bank of America/Merrill Lynch : Okay and then have you quantified what your debt reduction number target for the year is?

No we haven’t. We have just said modestly and depending on where you are from an earnings perspective and we did say we would expect net cash generation to be in excess of earnings. So you can kind of back into it based on our guidance. But, we do expect a modest reduction. Seth Weber - Bank of America/Merrill Lynch : I got it. Okay, thanks very much.

Your next question comes from Tony Fiore with Silvercrest Asset Management

With respect to the change in payables during the quarter, a pretty big use of cash flow. I understand lower production levels were a factor. I am wondering if you saw, or if you are seeing any sort of structural changes from your suppliers in terms of them trying to shorten payment terms?

No. I mean we obviously monitor the supply base for key suppliers that are struggling, and we have some that kind of cross over with the automotive industry. We will, on occasion, accelerate payment in specific circumstances, but that is not a broad or a particularly significant factor. What you are seeing there is really the function of taking production down.

Okay and I may have missed this, but as you look out over the full year do you expect working capital to be a source or use of cash?

It will be a source of cash.

Okay, thank you.

Your next question comes from Michael Rehaut with J.P. Morgan.

The bolt on, you had mentioned, it was one of your last prepared remarks that you continued to look at small bolt ons. I was wondering if you could give us any more color on that or granularity with regards to which segments you’re looking at more than others. Also if one of those segments, I believe would continue to be the PT&A, if there are specific product categories that you’re more interested in that perhaps you don’t have a presence in right now.

We are still continuing to look at small bolt ons. I think that there are and will become more compelling valuations out there as time goes on. I really don’t want to telegraph specifically where we’re looking at this point.

All right. But, would it be safe to say that you are not necessarily expecting to pick up an activity over the next couple of quarters?

I’m not sure what you mean. I think we continually look at things, as valuations become extraordinarily attractive we will continue to look at part of the stuff. I don’t envision a more intense search though, if that is your question.

But some additional things may be able to come across the goal line given valuations, Mike.

Right, absolutely. I would just like a couple of numbers. The US business, you had mentioned earlier that you estimated that the sell through for PT&A and I would think you’re talking about the US sell through down in the mid teens. You gave us US Industrial down 30, US consumer down mid single-digit, but I don’t have the exact revenue split. Can you just give us what the overall US business was down revenue wise for your own business?

Do you mean the total US? We try and give you some color on that from a pro and consumer perspective, Mike, as opposed to kind of consolidating it into a number.

Yes and I am just trying to get the apples to apples. If you’re saying that sell through is down mid teens. [Interposing]

Sell through was down less than sell in.

Right, so I am just trying to gauge if that was a 3% difference, a 5% difference?

When we give you sell through information it is also not on the entirety of the population. It is really difficult to pin that down that precisely.

Okay. Just corporate expense, you expected $16 million per quarter for the next three quarters, but if you add back the $6 million of environmental, legal, that gets you to a $10 to $11 million number, which is roughly in line at the quarterly rate that you were doing in 3Q08 and 4Q08. Am I missing something there in terms of why it would necessarily be higher than that?

Well I think it has fluctuated pretty greatly over time. I think in addition to the legal, environmental, there was some other reserve movements in there that aren’t of a recurring nature, so, ergo the $16 million run rate; $16 is actually I think reasonably similar to where we’ve been in my recollection over time and that’s kind of the a little higher corporate pension expense offset by some favorability on spending; relative to thinking about it to the last year.

All right thank you.

There are no further questions at this time. Do you have any closing remarks?

No. Thank you for your interest in Black and Decker and we will be available to answer questions through out the day.

Thank you. This does conclude today’s conference call.