Good afternoon. My name is Karee and I will be your conference operator today. At this time, I would like to welcome everyone to the Trimble First Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question-and-answer session. (Operator instructions) Thank you. Ms. McManmon, you may begin your conference.

Thank you for joining us for our first quarter 2009 conference call. I am here today with Steve Berglund, our CEO and Raj Bahri, our CFO. During the course of this call we may make projections or other forward-looking statements regarding future events or the future financial performance of the company. The words intend, expect, plan or similar expressions are intended to identify forward-looking statements. Such statements are subject to risks and uncertainties that could cause actual events or results to differ materially. Important factors relating to our business including factors that could cause actual results to differ from our forward-looking statements are described in our Form 10-Q, 10-K and other filings with the SEC. The company assumes no obligation to update these forward-looking statements to reflect actual results or changes and assumptions or other factors. Before I turn the call over to Steve, I would like to mention that we will be attending the (inaudible) conference in New York City on May 14, as well as the William Blair conference in Chicago on June 9, Steve?

Good afternoon. As we anticipated in last call the first quarter look much like the fourth quarter. The engineering and construction segment remains in a historical unprecedented downturn. Slowdown is worldwide with China the only current reliable source of growth. The level of uncertainty remains high and the ability to reliably forecast of business remains limited. Historical patterns and market behavior we have been able to rely on as predicted indicators or non-currently operative which leaves us reacting to highly dynamic real-time world. The current paradox is that despite the significant downturn we have seen during last six months. The level of interest and activity in the marketplace is significantly higher than the results would indicate. This activity typically takes the former product demos in quotes; these are not turning into orders at anything like the historical rate, which implies there is pent-up market demand combined with the hard freeze on the spending. This tends to confirm our hypothesis that our primary problem at the moment is win a business confidence. More so the underlying demand for productivity and productivity enhancing capabilities. We believe the inflection point for us in the E&C segment will come when business confidence begins to shift. Not necessarily solely upon economic recovery. In other words our upturn may proceed recovery of the industry as it is typically measured. The Field Solutions segment demonstrated double-digit revenue growth year-over-year and improved margins. This was a reflection of agricultural results, which provided year-over-year progression despite a very difficult comp in last years results. Our sales of large agricultural equipment such as tractors appear to be slowing. We continue to have careful optimism on the 12 month prospects from maintaining or growing our agriculture business. This relative optimism is based on the ability of technology to improve the bottom…

Good afternoon. Revenue for the first quarter of 2009 was $289 million, down approximately 19% from revenue of $355.3 million in the first quarter of 2008. Operating income for the first quarter of 2009 was $24.3 million down approximately 58% from the first quarter of 2008. Operating margin in the first quarter of 2009 was 8.4% compared to operating margin of 16.3% in the first quarter of 2008. Adjusting for the items that are reconciled in our financial tables in today's press release. Non-GAAP operating income of $45.9 million was down 37% compared to the first quarter of 2008. Non-GAAP operating margin was 15.9% in the first quarter of 2009 compared to 20.5% in the first quarter of 2008, although, margins was down versus the first quarter of 2008, we saw a significant improvement in non-GAAP margin versus fourth quarter of 2008 non-GAAP operating margin of 10.7%. The sequential margin improvement was due to higher revenue and partial quarter impact of the restructuring implemented in January of this year. First quarter 2009 net income was $17.5 million, down 56% compared to the first quarter of 2008. Diluted earnings per share for the first quarter of 2009 was $0.14 compared to diluted earnings per share of $0.32 in the first quarter of 2008. Non-GAAP net income of $33.7 million for the first quarter of 2009 was down 33% compared to the first quarter of 2008. Non-GAAP earnings per share for the first quarter of 2009 was $0.28 compared to non-GAAP earnings per share of $0.40 in the first quarter of 2008. The tax rate in the first quarter was 25%. Cash flow from operations was strong at $43 million more than double the $21 million in cash flow in the first quarter of prior year. By geography, in the first quarter…

(Operator instructions) And your first question comes from Michael Cox with Piper Jaffray. Michael Cox – Piper Jaffray: Hi good afternoon.

Good afternoon. Michael Cox – Piper Jaffray: My first question is on the E&P side of your business we have heard from several of the industrial companies that to recover that the sequentially trend seem to be I guess getting less negative or the sequential drop is less severe. I am curious if you are seeing that in your business, maybe moderating a little bit.

I think statistically it's hard to prove anything at this point in time in terms of the use of hard data. I think fourth quarter was exceptionally confused, I think the first quarter was less confused if that’s an indicator. But I think what is potentially encouraging as I said is that, lets call the anecdotes are comparatively less negative and in fact some of the anecdotes tend to be comparatively positive. And the anecdotes tend to revolve around the number of demos that are being given, if demos of product as well as quotes being issued. Now for the last six months those are not turned into orders and therefore they have not turned in to revenue. But in general the relative talk out there, the relative set of anecdotes that are being relayed verbally are not as negative as the numbers would say. So it's too early to actually point a data to say that what the trend is. But I would say the background chatter is not as negative as the numbers will be to imply. Michael Cox – Piper Jaffray: Okay that’s helpful. In the Field Solutions side of your business it seems that the growth there runs contrary to what we been hearing from at least to a couple of your competitors. And I will be curious how much of the growth there was attributable to the acquisitions versus internal organic growth.

So actually if you look at the segment grew around 13% year-over-year and GIS business which is part of that actually did not have growth. So agriculture actually experienced more growth than the Field Solutions segments imply and I would say you know roughly half of the growth was organic and half of it was acquisitions. Michael Cox – Piper Jaffray: Okay that’s great and my last question is on the expense side. R&D and sales and marketing expenses declined year-over-year but G&A was up so only what factors led to that increase and if we should continue to expect that?

So two factors. G&A will go down next quarter. The two factors were we had a bad debt I mentioned that we had a bad debt reserve of over $2 million focused on primarily one E&C dealer. Michael Cox – Piper Jaffray: Okay

Last year we did not have that and acquisitions since the last year we acquired a few companies. Those are the two primary reasons and if you take those things out G&A was actually down on an organic basis. Michael Cox – Piper Jaffray: Great thank you very much.

Your next question comes from Ajit Pai with Thomas Weisel Partners. Ajit Pai – Thomas Weisel Partners: Hey, good afternoon. A couple of quick questions I think the first one is to do with your cost cutting that you have talked about in the quarter. You said you took cost reduction actions within the quarter and you are going to take additional steps if conditions require. Could you give us some color as to what the nature of the cost cuts were and on a go-forward basis whether there are going to be additional cost cuts at current business levels or business will have to deteriorate further for you to take additional cost cutting actions?

So I think in terms of the nature of the cost cuts you probably put a check mark by all of the typical categories. So January did involve a reduction in force, salaries are pretty much across the world, or at least wherever we can legally do it. Salaries are frozen at this point in time. There has been some level of encouraging people to take time off, depleting the implication accrual. And beyond that lets call moderate attempts to reduce travel. For example, on travel we are being less draconian than may be a lot of companies are from the standpoint that any travel, our travel that is out customer facing we were attempting to maintain, simply because we believe it's one thing we can do in this environment that maybe competitors can't do as much. So we are attempting the intelligent and focused in our cost cutting. But it's pretty much across the board from small things to large things. I think that the way we are managing through this is since we have a number of businesses in different conditions at this point in time. So, obviously Ag remains comparatively strong, E&C in a weaker condition is we are managing within the context of each of these businesses. So we are taking cost cutting actions. We are taking other actions as required within the context of each of these individual businesses. So, I think that we will continue to look at cost cutting actions within the context of the business. Many of the actions we launched in the first quarter won't be fully complete until into the second quarter, so we haven't seen the full effects of those yet. But again, I think that we will watch and see what's required, but I think the force in function, we are using to determine whether we are doing enough is whether we reestablished to trend back towards that 20% operating margin. We achieved the 12 month rolling operating margin of more than 20% for the first time in the quarter, ironically that ended in September. We wouldn't expect to get back to that let me take some time to get back to that particular level, but we will use that as the portion of function and we will look at each individual business within that context. So, we will continue it but not necessarily with across the board actions. Ajit Pai – Thomas Weisel Partners: Got it. So then on the investment line when you are looking at your expenses, you still have to see the full impact, but in gross margins you had one of the best gross margins you have had for the first quarter in a long time I think since 2002 on materially lower revenues. And usually going into the second quarter your gross margins are sequentially up. Are things going to be different this time and what sort of contributed to such a significant improvement on a year-over-year basis in gross margin?

Ajit, first of all there is no major pricing pressure on the margins I will start with that. And generally as we have done acquisitions and as our focus has been towards more and more software-oriented products. We have seen a general expansion of our gross margins overtime. And if you look at trend line it has slight there maybe one quarter here and there where you see the gross margins dip, but if you look at the trend line over the last three years or four years gross margins have slightly been keeping up over time just because the mix of products, higher software, higher subscription type of sales and absence of any pricing pressures. And coming to the Q2 it's too early to say our assumptions as we will be flattish in Q2 versus Q1. Ajit Pai – Thomas Weisel Partners: Right, but the cost cutting that you talked about let's say pricing have stable, the cost cutting that you talked about is sort of equality split between cost of goods sold and the expense line, or is it centered in one category rather than the other?

It impacts both but it’s probably more towards OpEx line in terms of its weightage. Ajit Pai – Thomas Weisel Partners: Got it. And the acquisition that you talked about within the quarter and the once that you on a go forward bases, is it fair to assume just pays in the numbers that you gave that the majority of the acquisitions were in your Field Solutions business so was it less than 50%.

Well, all the material acquisitions were in the field service business now we did acquire QuickPen part way through the year which is in the E&C segment. Ajit Pai – Thomas Weisel Partners: Got it, thank you.

Thank you.

Your next question comes from Rich Valera with Needham. Rich Valera – Needham: Thank you, good afternoon. You made reference to an unusually favorable gross margin, I think operating margin here TFF division due to I think a higher percentage of new products and they carry higher margins. Do you think this is sustainable, due you think you will continue to see this higher mix of higher margin new products, you did think those margins might revert back more towards, more normalize mix going forward?

Well, I think it’s probably a fair statements say gross margins were favorable in he Field Solutions, but I think gross margin of that wasn’t exclusively, if deposited gross margin effect wasn't exclusively focused in the Field Solutions. I think obviously the operating margins in the Field Solutions segment were positive in the quarter. I think that it has more to do with the fact that revenue continuous to be strong and we are leveraging a relative fixed cost base, I would not attributed the majority of the positive effect to new products, I think that it has more to do with the underlying structure of the business but whether its sustainable or not we will see. Certainly our view is that we are it's a good time to be investing aggressively in agriculture; we are certainly reflecting that on the acquisition line with recent acquisitions. We are also stepping up the amount of R&D we are doing. So, I think in the longer-term it's probably not realistic to expect that will keep these operating margins in the Field Solution segments if nothing else there is going to some market arbitrage that goes on overtime but also I think that we are inclined to reinvest in the segment and make agriculture a bigger business than it is today. Rich Valera – Needham: That’s helpful and in your earlier comments Steve, you talked sort of acknowledged that tractor sales were actually declining, I think the last couple of reported months they were down year-over-year. And generally I think someone else acknowledge your competitors, we are talking weakening backdrop in Ag. So if you look at the rest of the year do you see and you talk about potentially growing the business for the year do you see sort of decelerating year-over-year growth as the year progresses, that’s some of these sort of new headwinds taken to coming to effect or do you think you can maintain similar levels of growth as you saw in the first quarter?

Well, in this macro economy, it's hard to be certain about anything and all I can express is fair amount of humility in terms of what we may discover as the year goes on. I think first of all is that 2008 represented a remarkable for agriculture in terms of growth rate. So the comps throughout most of this year are just going to be extremely tough for Ag and very difficult to match. So I think I guess that context I think that it's going to be a difficult year just to do well against a spectacular 2008. Now having said that, I think the factors that are in play here is again this ROI premise is one we really do believe and as a company is that recession and say drop in heavy metal sales do not necessarily correlate totally to us, its easier to sell to an up market where farmers have lots of money and their spending it on tractors and pickups in our stop. But even in that context they may forgo the new pickup, they may forgo the new tractor. But we still have the ability to go in and basically sale cost savings that farmer and retrofit on the existing tractor. Again international markets which are comparatively in some cases green field opportunities for us remain available to us. So we still have an opportunity to go sell in places where we are not very well penetrated yet. And then again with the acquisitions and other internal development efforts we again have some comparatively Greenfield opportunities in agriculture where we have not played very much in the past. And all three of those factors I think come together to say that the outlook for agriculture certainly more positive than for E&C and we'll see to so much how much we can deliver on the top line in agriculture as the year unfolds. Rich Valera – Needham: Okay. Thank you.

Your next question comes from Eli Lustgarten with Longbow Security. Eli Lustgarten – Longbow Security: Good afternoon.

Good afternoon. Eli Lustgarten – Longbow Security: Quick question, clarification, can you give us how much were of the sales in the first quarter were due to acquisitions and how much actually acquisitions, that was skip between the sectors?

Most of the acquisitions, let say it was in versus last year most of the stuff was in Ag there was some acquisitions in E&C space. And roughly acquisitions for the full year contributed roughly around one to two points of growth.

As I said, most of it was in Ag. Well, Ag was the only one that had up sales, and the sales were up of about 12% or something like that.

And I said half of the growth in the Field Solution was driven by organic and half of it was acquisitions. Eli Lustgarten – Longbow Security: Yeah. And what about, whether how much revenue was there in E&C from acquisitions.

Very minor, Eli. I will get back to you, but it was very-very minor. Eli Lustgarten – Longbow Security: Okay. And in your discussions earlier, you talked about, somebody asked you about the US market whether it's stabilizing or not. What are you seeing in Europe agricultural division particularly we are hearing Europe is in free flow. We are still on free flow. Are you seeing still very difficult conditions outside the US?

Well, I think Europe is multi part story. So certainly Spain, Ireland, Spain and Ireland in particular may be are comparatively get to the world at this point in time, the bubble was burst in both of those countries, have not recovered. I think Germany tends to be more of a question mark, there is competing data for what's really going on in Germany from our perspective, France somewhat in the same boat, Scandinavia and northern country us somewhat better. UK is a question mark but UK if looking beyond the current headlines may actually have some upsides of it. So I think that Europe is very much the next big and it's very hard to generalize, but clearly it was a not a good quarter for is in Europe. But I would not describe it generally in the freefall mode at this point in time. Eli Lustgarten – Longbow Security: I guess, you indicated that North America was down 30% and Europe was down 30% which is equal as we look into the second quarter is it fair to assume that Europe will be weaker than North America at this point?

I think we said North America was down 13% Europe was down 30% so Europe was definitely kind of compared to the prior year was definitely more soft than the US. Eli Lustgarten – Longbow Security: North America was down 13% I'm sorry then I'm sorry

Yeah. Eli Lustgarten – Longbow Security: I apologize and then –

So we're not calling a base, we're not declaring that we found bottom we're not declaring that we found the base line anywhere yet. But with some help during the second quarter we actually start to find reestablish the base line in both places actually. Eli Lustgarten – Longbow Security: If I go through your size in profitability on a GAAP basis just for a moment you find that you confidently allocated it had to a big number to get between with reports for operating income and your actually operating profit which applies at $27.8 million which is up sharply from $21 million is that’s where the restructuring stuff in.

Yeah, we have restructuring charges of $4.5 million. We had intangibles amortization which has increased because of acquisitions the total intangible amortization was $12.3 million of that 5.3 was in cost of goods sold and around $7 million was in operating expenses and then we had the regular items stock-based compensation of 4.2 and then those are the major items in doing that. Eli Lustgarten – Longbow Security: And the tax rate was surprisingly lower than we expected as you pointed and it’s actually below what the 27% you forecasted in the second quarter is it something in the first quarter that dropped the tax rate down so much that is it repeatable or?

No, you know for the full year, I am still guiding at 27. We drop a couple of points drop because we had California; there is a change in the tax law which enables us to recognize some benefit which will impact Q1 only. So, for the rest of the three quarters, I am expecting it to be 27. Having said that, there is always going to be a variation of plus, minus, you know, a couple of points. Because, it depends upon the mix of profits. How much comes from international and how much comes in the U.S. Eli Lustgarten – Longbow Security: Okay. One final question going back to the Ag business, so I guess, the idea is as you said, large equipment are still quite strong. But I expect to slower through the year. Is your sales in the Ag business you are seeing, going, you know, the big numbers, the big profitability, is it really to the customers, or is that provided.

I would say, it is still heavily, still weighted towards the end user in the after market, although, the factory installed business with the alliance with C&H is increasing as proportions, but is this still a multi-factor distribution solution? I would say it is still weighted towards the after market and going right to the end users. Eli Lustgarten – Longbow Security: Okay. Thank you very much.

You bet.

Your next question is from Yair Reiner with Oppenheimer. Yair Reiner – CIBC: Guys, good afternoon. First question, could you walk us through the linearity during the quarter, and I guess most, pointedly, have you seen any improvement in the month of April, seems it though. You know you said a lot of problem is right now is the sentiment uncertainty among your customers current potential, any sense that, you know, there is some confidence returning to the market?

Again I will be exceptionally careful here because as I said in the script that there anytime we have tried to apply in historical template or anytime we have attempt to deploy the any historical template to the last six months. It has been an exercise thought with uncertainty. So, I would say that in the first quarter we do not see the typical March end seasonal burst that we typically see from construction. So, the question is okay how much seasonality, how much of the seasonal boost will we see in terms of the second quarter in construction and survey. Now we had, I guess roughly three weeks of April which does not represent a whole lot of data to project from, but I would say in general is the first three weeks of April would be what I will be call reassuring the guidance that we given is not unreasonable. So, I would say is too soon to tell, but certainly the data from the first three weeks is for the moment reassuring one bad headline and that could change your course. Yair Reiner – CIBC: Okay. Thanks for that. On the income from JV that dropped significantly quarter-on-quarter, I imagined that that has mostly to do with the restructuring of the agreement with Caterpillar or so maybe you could walk us through whether that's the case and if so where some of that income may have flown to?

So that's actually not the case. This is actually the old joint venture that is impacting. The new joint venture we actually consolidating in our results because we own 67% of the joint venture. So this is the old joint venture we had with the Caterpillar and the income there is much lower because the construction days are lot lower then Q1 of last year and that’s the primary driver of the reduction in the joint venture profitability. Yair Reiner – CIBC: Very good and then I guess moving forward we should probably think of that is more of a base line that in the 2008 even the December 2008.

Yeah, as we to think that more as base line as we model the next few quarters maybe slightly up the seasonality in Q2. Yair Reiner – CIBC: Okay, very good. The one final question, there is some indications that several of the credit markets for Ag not in the US internationally maybe seeing some pressure, to what extent are the purposes of your Ag equipment tied to credit in any of the markets internationally.

Well, directly, I would say not a whole lot of our price points are generally significantly lower then certainly the cost were attractive or even the cost of the pickup trucks. So I don’t think we are primarily dependant upon credits to finance what’s being bought for us the question is whether if on credit, it comes under pressure. It sets maybe a back drop and probably take this money flow up whether that has an effect on us in the secondary or not is the question but I would say is in the primary cases its not necessarily factor for us. Yair Reiner – CIBC: Thank you very much.

Your next question comes from Paul Coster with JP Morgan. Paul Coster – JP Morgan: Thanks very much (inaudible) from off a call. First half I guess we are just trying to get an update on a status of the new caterpillar JV, if you are seeing any of the anticipated benefits yet?

Well, I think there we’re seeing some benefits certainly things in terms of converting the distribution channel is moving slower than we anticipated six months ago when we establish it some way simply because principles as well as our own dealers are dealing with the situation that tends to grab a lot of mind share at this point. But I think the relationship the multi party relationship, the relationship between Trimble and Caterpillar and the new JV all of that is working quite well. I would say it's probably too soon to say that the JV itself. The new JV itself is producing results. There is still development we are going on that has yet to result in a new product. What I would say is that it is functioning. There have been any net surprises in terms of functioning of the new JV. I would say that there is what's call some early positives in the marketplace but I think we are probably operating on a six month like basis in terms of seeing the benefits. It's really the first six months we had some progress, we had some conversions. There is a lot of work in progress at this point in time. But we haven't seen the new distribution channel really established at this point of time but given the amount of work in progress at this point in time and let's call the heightened management focus on getting it done I think it's largely perspective. And there are number of anecdotes over the last few months that show progress but I did nothing really has effected the numbers in a big way. Paul Coster – JP Morgan: Got it. Thanks. And then lastly, Raj, was there any impact top line or bottom line from FX this quarter?

Yeah, so, in a dollar debt strengthen versus last year. So we lost a little bit in revenue because of that and as you know on the operating income side we are pretty much hedged from operating expense point of view. So we did not have any impact much impact on the bottom line. Paul Coster – JP Morgan: Got it, okay. Thanks guys.

Your next question comes from Corey Tobin with William Blair & Company. Corey Tobin – William Blair & Company: Hi good afternoon, couple of things, let start in MCF we all have bad headlines and hearing stories and we are not but can you just give us a feeling of where are you actually seeing the strength out there who is buying are you seeing a more in survey, are you seeing in machine control, I mean is better to have lines are the numbers to me actually look relatively encouraging for work quarters can you just give us a bit of feeling for what is actually going on E&C?

Well, I think that in a general sense is there is category of buyers out there weathered be survey or construction that satisfy a couple conditions one those that have balance sheet and those that have cash flow and those that are let say have a strong set of management values relative to technology those are the characteristics in those companies whether they be construction or survey that I think are those that are buying at this point in time. And I think what will happen during this slowdown, particularly extends for any period of time, is that there is going to be relatively massive consolidation that occurs of the stronger players taking significantly increase market share and the weaker players, probably vanishing in one way or the other. So I would say if that is probably the driving profile here is that those have the financial strength and have the view that this is an opportunity, a period of opportunity. Those are the ones that, our customers at the moment. So again I probably have said in prior calls. I think one of the things that may actually occur in the slowdown again particularly if it lasts for a period of time. Is that the relative penetration of the technology in to the market place, whether it be construction and may be to a lesser extent survey. But certainly construction as the penetration rate may take a step function up during this time. Because the only way to survive this slowdown when the competitive intensity has ratcheted it up big time in terms of who is competing on jobs. And the number of players competing on jobs. It will be those players, those participants in that competition that are using the technology that will win and be able to survive. So I think it's more along that, so it does, yes tend to favor the bigger companies and I would say that probably is tending to be the bigger players that may be our customers during this period of time because they are able to continue investing during the downturn. But I think there is a significant consolidation that’s underway. And I think for us that tends to be a positive simply because those, that will end up winning their consolidation play customer for the technology. Corey Tobin – William Blair & Company: Is it more on the survey side of a machine controller side? Do you have any sense for that, is roughly --

I think it's more evident on the construction side on the machine control side. Or for that matter this emerging category of BIM which does more relative construction of the building, surveyors tend to be more of a cash driven sort of animal as when they have a job they’ll go on buying new instruments now the same paradigm works but maybe a little less dramatically on the survey side. So I would say is the paradigm I just described is much more visible on the construction side. Corey Tobin – William Blair & Company: Great. Should we shift in the channel for a second? In Q3, if I remember correctly, you had sort of mentioned that the dealer inventories were very thin in Q4 if I remember correctly there was some commentary that dealers might have sold down inventory and then they became thinner I guess. Where do feel that dealer inventories is today and we saw a lot of commentary on talking about dealers taking their inventory levels do you feel that the dealer inventory for your channel is appropriate at this point or is there risk that those bubbles come down and creeps up and hits you guys here in the latter part of the year.

So well, I think dealer inventories thinned down even more in the first quarter. We it’s a rough science but we've tracked the data and we believe that there was a further rundown of the inventory in the first quarter. Our overall sense is that they’re getting close to be close to bear minimum and dealers are not placing stock-in orders which was in effect we saw at the end of the first quarter because typically at the end of the first quarter we’re heading in the season in the E&C and what we see is a relative surge of stocking orders as dealers prepare to deal with the demand in the second quarter, that did not happen at the end of the first quarter which took some of the loss at the end of the quarter. But I think our overall sense was that dealer inventories are getting about as low as they can get is when they get order they place an order on us. So what I think, we were going to see from this point on is pure market demand. There probably won't be much of an inventory effect left. Now, my hope is that frankly we figure out a way to operate with the dealers at this lets say very thinned out inventory levels that we can become good enough, Trimble can be good enough, is that were, we are fast enough in delivery is that the dealers don’t have to rebuild this inventory. Because it would mean that we have taken significant out of the total dealer channel. But I don’t think there is a whole lot of inventory left out there to deplete off. So I wouldn’t expect any negative inventory effects of any magnitude for us as a company for the rest of the year. I think it is about as minimum as I can get at this point. Corey Tobin – William Blair & Company: Great. And one more balance sheet question if I could. You know, the profitability stayed in E&C, I think it is an absolute dollars levels, it is running pretty close to mobile right now which given the revenue contribution is little bit surprising. So, just trying as best for the cost-cutting we saw in January and will you expect to see here a Q2. Do you think that there will be a significant pick up in margins here in the E&C segment in the second quarter?

Yes. So, E&C was impacted also by a bad debt write-off of $2 million and if you put that in the E&C margins double versus the reported numbers roughly. And then we also see a full quarter impact of the restructuring that took place in the first year and it was primarily focused on E&C. So, that will expand margins also. So, yes, in Q2 you should see a sequential improvement of E&C margins. Corey Tobin – William Blair & Company: Great. And then trying impact of the balance sheets on the AR reserve, you mentioned the $2 million charge this quarter, how do you feel the rest of the AR looks at this point? Do you think you would see a need for additional one time items going forward here?

Couple of things there, we said it was primarily one dealer and then aging is fairly good for most of the dealers. Our DSOs were actually down versus last year same time by three days. So we will have isolated issues here and there but it's not a big problem. Corey Tobin – William Blair & Company: Great. Thank you.

Your next question comes from Jeff Evanson with Dougherty & Company. Jeff Evanson – Dougherty & Company: Good afternoon, gentlemen. I guess I will start with my biggest question here. Steve, have you ever seen dealers not come in with striking orders at the end of Q1?

No, when I started up with script by saying we are in a non-precedent new territory here and serious is that what is happened in the last six, seven months has been a huge shock and we are seeing behavior that is not at all traditional. So, I've never seen that but I think that again this headline factor has got everybody spooked and cash preservation, cash conservation is at the top of everyone's list and that includes our dealers. Jeff Evanson – Dougherty & Company: Terminal layout of scenario that I see potentially developing here in the construction market and I would like to get your response to what could unfold here? As contractors win bids for several ready stimulus projects. The only way they are going to make any kind of money on those thinly big projects is to increase their productivity, driving demand for machine control at a time when there is no inventory in the channel and you get slammed with orders in Q2, what is going to be your biggest constrain in responding to a potential surge in demand your response to my thesis and you answer that question please.

Why its certainly help you right Jeff, although personally I think that the shovel ready project scenario, will turn out to be less, it will turn out to be less shovel ready then and in the politicians actually said so I first not sure that there is a huge wave that’s going to break in second quarter on shovel ready products, I think projects, I think it will be in effect over the course of the year. So I am not sure that there was a tidal wave about to strike us in the second quarter and I hope you are right but I don’t think so, at the moment. But if we, but I think here at the beginning of your premise here is that certainly I think the winners will tend to be easing the technology because there is no other way to go into biding a job with probably two, three, four times as many competitors biding that job as you would have seen in the couple of years ago. So the only way to win that job is to pull out the sharpest expense that you can get and cut your estimate as opposed to the HSZ camp and the only way to do that is with the assurance that you got the technology behind. So certainly buying an instant interact part of the premise we will see whether there is a avalanche of shovel ready stuff that actually shows up in second quarter, but if it does, if we didn’t receive an out of orders I am pretty confident that we will be able to respond there is access capacity through the entire slight change. Considerably there might be some long lead items that would slow us down but whether it if it did occurrence second quarter some of it slopped over into the third quarter certainly within a couple of months we could gear up on, so whatever came. So, that gearing up like doesn’t worry me at all. Getting the orders is my primary concerned at the moment. Jeff Evanson – Dougherty & Company: Right. So, judging is certainly judging the time and size of the rebound is difficult.

Right. Jeff Evanson – Dougherty & Company: But can you give us some anecdotal sense of how constructions firms are responding to an increase need for technology? And how it's impacting sentimental penetration out there? You mentioned clothes and demos are up. I would imagine that these construction firms now certainly the once I am talking to are really scrambling for how they are going to survive and they have got to cut cost to do that.

So, again I think constructed firms are definitely in a huge hunker down mode at this point in time and think they follow up fairly quickly in to the categories of those who balance sheet and manager retain some level flow minimizing the negative cash flow. And there are those that without much for balance sheet hedge and those that our operating without a balance sheet had you are probably to disappear in this environment. But I think the relative I think the contrast for 2001 or 2002 the last recession which payouts in comparison to what we’re going through at this point time but the difference between this go around and it was in 2001 and 2002 we were still and nearly a doctor pace with the technology. It was a not a survival issue. I think the technology truly is survival issue today and a contractor will not survive without the edge. Jeff Evanson – Dougherty & Company: Contractor feel that way.

Yes, I think contractors feel that way, let me give you an anecdote so this year's Trimble's dimensions was held in February. Last year we had roughly 2004 people attending, this year we have slightly more actually an attendance than we had 15 months ago. So in spite of a hard recession that is just biding the cash flow these contractors, we had an equal attendance this year at our users' conference as we did at the last one, which I think is phenomenal and I think represents the absolute belief on the part of contractors as they have to pay current on the technology if they are going to survive. And I think that on a day-by-day basis in terms of what our dealers are saying in terms of their request for demos, their request for quotes a speculate quote I guess, is I think the thing we are pretty convinced up is that the penetration rate in the slowdown is going to go up significantly from what it was before the slowdown. Jeff Evanson – Dougherty & Company: Okay. I am pretty disappointed on this SITECH update as I am sure you are, why is this taking so long and particularly I have be hard impressed taking the answer that it just the economy. What’s going on there?

But that’s the answer you are going to get Joe, I mean when a dealer, whether it would be a Trimble dealer or a Caterpillar dealer takes a huge drop in the revenue. Okay, so you look at the caterpillar machine sales as an indicator of what the dealers are seeing and their business model has just been absolutely trampled on really since the October-November timeframe mark. And so in terms of Mindshare [ph] on our dealer side and their dealer side the Mindshare is 100% focused on kind of current circumstances. And so believe me or not believe me but that is absolutely the only answer at this point in time. The level of enthusiasm for the SITECH concept with a couple of warrant cases [ph] out there obviously but by and large across the Caterpillar dealer network and across the Trimble dealer network the relative enthusiasm for SITECH is as strong as it ever was. But really what has impacted is an economic crisis that really has impacted a lot of people's business models in the short-term here. Jeff Evanson – Dougherty & Company: SITECH could help our profitability 200 basis points do you still see that happening?

Well, in terms of growth, I think it was revenue growth. Jeff Evanson – Dougherty & Company: Yes, revenue, I am sorry.

I still see that happening, but again I've already talked to the in fact its probably going to occur on the three to six month late basis from what we thought it was going to be. Jeff Evanson – Dougherty & Company: Okay. I'm going to presuppose something with this question, and ask you for the shorter list. I assume you are taking market share in most of your product categories. What product categories are you having less success with in the marketplace relative on a market share basis?

On a market share basis, I am not sure I got one for you. Certainly in the Mobile Solutions space, okay current circumstances favor us because we got the relative credibility of being bigger agricultural, don’t know precisely but I think maybe the competitors are suffering a little bit more than we are in this space. So as a matter let me tell we are probably doing fine in agriculture and then we get the E&C I think if you look at the competition and maybe after doing some forensic accounting that I don’t believe there is a single category of product where we were loosing share. Now some of these geographic regions are comparatively confused at this point in time in terms of size of the market. There could be some regional cases where I have to confess that maybe we are not doing as well as we would want, but I think there is a single product category that I would instantly throw up and say okay we are having market share difficulties without a doubt we have got categories where we were having difficulties but I am not sure market share difficulties is the current problem here. Jeff Evanson – Dougherty & Company: Okay. And then two very quick questions to Raj and then I will shut up. Raj when do we anniversary the bulk of this Ag acquisition revenue. I put it at about $5 million to $6 million, is the quarter than anniversary in Q4?

Yes, we bought these acquisitions late in Q4. So really Q1 was the full impact so by Q4 we would have done the anniversary of these acquisitions. Jeff Evanson – Dougherty & Company: Okay, great. And then what happened with the rest of the world. It’s just kind of an anomaly that revenue, that geography basically got almost cut in half year-over-year?

Yes, so I think maybe Raj has more precisely answer, but I think it’s probably nothing profound and nothing general but certainly cases like the Middle-East, Dubai has fallen on hard times. 2008 was in Dubai for example, was running exceptionally high. Dubai is obviously hot what it was a year ago. So, I think in some cornered cases like Dubai, now generally in terms of the rest of the world, the picture remains positive. I don’t think what you saw this quarter is necessarily the template for the next four quarters in terms of what we are going to see in the rest of world. We are seeing significant amounts of activity in places like Africa, and North or South Africa for example and the like. So, I think it is more a collection of cornered cases offered with comparatively small base that accounts for the rest of world. I would point specifically at Dubai, not necessarily the Emirates in total, but specifically Dubai as being one of the major factors where it was running exceptionally hard a year ago and then has fallen apart obviously since the. Raj, do you have anything to add?

No. I think that’s right. Jeff Evanson – Dougherty & Company: No more endorse key areas.

Not in the short-term anyway. Jeff Evanson – Dougherty & Company: Thanks a lot.

Thanks.

Your next question comes from Jonathan Goldberg with Deutsche Bank. Mr. Goldberg, please go ahead.

I guess, we move on.

That question has been withdrawn. Your next question comes from Jeff Rath with Canaccord Adams. Jeff Rath – Canaccord Adams: Just two questions I will make them brief. I wonder if you could give some commentary around the regional strengths or weaknesses in your Field Solutions business as per from a geographic basis, obviously, you reported on a consolidated basis, any color you can give as far as strengths and weaknesses regionally. And then just a final one, is there a reason why the quarter would cut-off was April 3 versus I guess, this year and can you just explain that for me? Thanks.

Raj, you explained the quarter, can you explained the quarter thing.

Say that question again.

Was that April 3rd as oppose to a week earlier in March?

It was just driven by -- last year, it was a 53-week a year and year just started later this year. So, last calendar year which was 2008 was a 53 week year and basically we got us start later on in the year, so that's how the calendar dates are. Jeff Rath – Canaccord Adams: So effectively the revenue days are equivalent for this quarter?

Yes, absolutely.

It was a 13 week quarter.

It was 13 week quarter last year. Jeff Rath – Canaccord Adams: Okay. That's a simple answer. And any color you can give around the regional strengths and weakness in your Field Solutions?

No, I think when we talked about Field Solutions we have got GIS which tends to be heavy in the US or North America and Europe, most of the North America than Europe. And then with a relatively fast growing part in Asia particularly China, but I don’t think there was anything unusual in terms of the GIS split per se. Now agricultural tends to be heavy North America, heavy Australia, heavy Brazil so now increasingly heavy Europe. And so I would say is that, I am not sure that there were any large geographic discontinuities in Ag. I would say Europe is probably at the moment doing comparatively better than the other parts of the world, but I don’t know there was any kind of discontinuity or any real break with the prior quarters. Jeff Rath – Canaccord Adams: Okay, thanks very much.

Okay.

Your next question comes from Scott Sutherland with Wedbush Morgan Securities. Scott Sutherland – Wedbush Morgan Securities: Firstly a quick one for Raj, in your cost cut maybe how much of we have seen so far in Q1 and how much more should we see in Q2, have you seen about two-thirds or half those cuts so far.

We probably have seen slightly less than half in Q1. Scott Sutherland – Wedbush Morgan Securities:

What I think Ag is clearly, we are clearly an investment mode at this point in time. We are actually in the process of redeploying resources from elsewhere in the company to Ag as being the best opportunity or one of the best opportunities for us in the next 12 to 18 months. So I would say an Ag is clearly from an acquisition side we have shown an increased appetite for acquisitions in Ag but then also in terms of internal development we are clearly in an investment mode in Ag and I would expect that to continue. Scott Sutherland – Wedbush Morgan Securities: (inaudible) questions ago, talking about productivity gains of your technology. You are check strength only a lot different, US stimulus is nice but small and I think you mentioned in your prepared comments that China is really driving natural esteems for more derive what is there openness to your technology and buying your technology and how much relative you think that could be.

Well, again, I think looking at the next 12 to 18 months is certainly the Chinese stimulus package is going to be much more effective then anybody else’s. They announced in the next day they were implementing, but I think China for us is historically been more of a survey instrument market in terms of the bulk of the sales been on the survey side than on the construction side. So, we will continue to rise the way on the survey side, in terms of selling survey instruments, but I think the construction side represents more or less of a pure up side from a relative small number of year or two ago. We have I think substantial opportunity in China to penetrate the market. And I would say the receptivity to the technology in China is no less than as intense elsewhere in the world and in some cases maybe even more intense. I think they are very much driven by the idea that they have the opportunity to skip technology generations in China. And I think you see that in a number of different phases within China. And I think that the Chinese are very interested in applying the new technology. Now, the rational the justification maybe a bit different in China then in Iowa or somewhere, labor productivity per se isn't necessarily the driver because again the cost of labor is down. But certainly when it comes to quality and rework issues those tend to come right to the top of the list of things are used to justify the technology. So, I would say is the enthusiasm is generally high. There maybe at times say in education effort required like say the enthusiasm is high and we would expect the next five years to be actually a very good period for us in construction in China. Scott Sutherland – Wedbush Morgan Securities: Okay. And my last question is kind of to just understand your comments about how this tracks, maybe it is getting less back. Your overall guidance at a midpoint implies that year-over-year you are down worse in Q2 then you were in Q1 and Q2 is typically seasonally strong. I kind of understand that guidance in light of the fact that you are making kind of comments things are maybe stabilize again less bad. Are we reading that right or being a little bit cautious on guidance.

Okay, first of all, our three weeks into the quarter or 13 weeks and does has historically been a seasonally high quarter for us. So, we have learned to be cautious about applying historical patterns here. And I think the phrasing I used was the first three weeks have been reassuring relative to forecast we put out there. So, we are definitely not calling the bottom or definitely not calling a new base line here. But I think we will see how the quarter unfolds, but I would say is that anecdotes are positive first three weeks of data is reassuring I will see what all that means in another 10 weeks or so. Scott Sutherland – Wedbush Morgan Securities: Okay. I appreciate that. Thank you.

Okay.

Your last question comes from Alex Blanton with Ingalls & Snyder. Alex Blanton – Ingalls & Snyder: Hi, good afternoon. On that point you mentioned that the dealer or distributor inventories are down to practically nothing which means that they have been reduced over a period of time. So, that if sales were flat which you are saying they could be quarter-over-quarter and the second quarter. When that mean that the end market demand would actually have to be down, because if end market demand were flat you would have to raise your production in order because there would be the lack of the inventory reduction of prior periods.

You maybe have an arithmetically intern like consistent case here. Alex Blanton – Ingalls & Snyder: If your sales in the first quarter were depressed by dealer inventory reduction, but now in the second quarter the dealers can't reduce inventory any further your sales would have to go up when they have if demand were flat.

Alex you are assuming that the first quarter inventory effect was material I didn’t say that it was material. Alex Blanton – Ingalls & Snyder: Well, you didn’t -- I know you didn’t. You said that there was no inventory left. So I assume that some point it had to go.

No, I didn’t say that there was no inventory left; I said that the inventories tend to be on a minimal level. And there is inventory in the channels. Alex Blanton – Ingalls & Snyder: Yes.

First of all its not necessarily in the first quarter, fourth quarter was a more material effect, first quarter was less, I am not declaring it to be material so therefore I think that. Alex Blanton – Ingalls & Snyder: Okay, so you didn’t really reduce inventory while in the first quarter.

We did reduce inventory, I am just not saying it’s a material number and in terms of your analysis. Alex Blanton – Ingalls & Snyder: Got it. Okay. Secondly, in terms of if demand were to pick up, most of your production is done by a contract manufacturers. Is that correct (inaudible)?

Yes. Alex Blanton – Ingalls & Snyder: And they are very-very flexible as name implies. And so they could pick up production fairly quickly. They have got a huge supply chain and much more so than you could have on your own. Which of course, is the one reason that Trimble when it was, well with their predecessor which Flextronics acquired. But that was one reason for doing that that they have the resources to really flex the production pretty rapidly, don't they?

Yes, so as I told Jeff, is if we need to ramp up, ramping up is not one of my principle concerns at the moment. Alex Blanton – Ingalls & Snyder: Right.

So, I think that there’s enough flex in the supply chain that we can handle anything that comes at us. Alex Blanton – Ingalls & Snyder: Okay, thank you.

Okay.

At this time, there are no further questions. Gentlemen, are there any closing remarks?

No closing remarks. Talk to you next quarter.

This concludes today’s conference. You may now disconnect.