Ladies and gentlemen, thank you for standing by and welcome to the Textron earnings conference call. At this time all lines are in a listen-only mode. Later there will be a question-and-answer session. (Operator instructions) As a reminder today’s call is being recorded. At this time I would like to turn the conference over to Doug Wilburne, Vice President, Investor Relations. Please go ahead.

Thanks Kent, and good morning, everyone. Before we begin, I would like to mention our discussion today will include remarks about future estimates and expectations. These forward-looking statements are subject to various risk factors which are detailed in our SEC fillings and also in today's press release. You can also find a slide deck containing key data items for today's call in the Investor Relations section of our website. And we will be specifically referring to many of these charts during today's discussion. Finally, you can also find an excel download our income statements for the past five years recast to reflect the move of HR Textron to discontinued operations as a result of the sale of this business in the quarter. We will begin our call today, with a brief discussion of first quarter results, then Lewis Campbell, Textron's Chairman and CEO will follow with comments on our liquidity plan, the excellent progress we made in the first quarter and how today's public offerings support that plan. After that Scott Donnelly, Textron's President and Chief Operating Officer will review key operating items in each of our segments. We will wrap up with additional analysis of our first quarter results and a few comments about our outlook and we also have Dick Yates, our Acting Chief Financial Officer present to participate in Q&A as needed. Moving now to first quarter results. Revenues in the quarter were $2.5 billion down 24%. GAAP earnings were $0.35 per share, and adjusted earnings from continuing operations excluding restructuring charges were $0.26 per share compared to $0.88 a year ago. Our results included a $0.13 per share after-tax gain from the sale of CESCOM, our aircraft tracking service at Cessna. That’s our air company and it's tracking service at Cessna. On a pre-tax basis, the…

Okay, thank you, Doug and good morning everyone. The industrial and financial sectors of the economy continued to be a challenge for us this quarter. And as a result most of the company's commercial markets experienced further softening and TFC credit quality weakened. On the other hand we had continued solid results at Bell and Textron Systems. And importantly we had strong execution on our liquidity plan. Specifically, we liquidated $926 million of managed receivables at TFC about twice of what our planned calls were. As you know we also completed the sale of HR Textron for net cash proceeds of about $275 million. And we took steps to right size our manufacturing businesses and improve working capital efficiency. As expected we used cash to support our manufacturing operations in the quarter but we did so at a pace less than what we have planned despite lower than anticipated volumes. Looking to the full-year we expect a significant contribution to cash generation from inventory reductions as the year progresses and we remain on-track to generate $400 million of manufacturing free cash flow for the full-year in 2009. To ensure our organizational focus on our cash objective, we have already incorporated a significant incentive compensation management element for our top 1000 managers directly linked to stretch cash generation goals. Okay, let's discuss our overall liquidity plan starting with a review of the planned objectives which we have listed on page 4 in our schedules. And it is going to be important to follow these schedules especially for page 4 and 5. Okay, we intend to complete our plan without selling any of our core assets including the captive finance business. In addition we looked to maintain a minimum cash balance of at least $1 billion to ensure operating flexibility. Over time,…

Thank you, Lewis. Good morning, everyone. I would like to start a discussion this morning on manufacturing side of the business where our focus remained on driving productivity, improving our working capital efficiency and generating cash from these businesses. We achieved and had plan cash flow position in the first quarter as we saw early results from our efforts to reduce our inventories and conserve cash. Our only inventory growth which we will talk about later is in Cessna. Perfect demonstration this was evident our industrial businesses were despite significant volume declines of 35% led by nearly 40% decrease in Caltex, resulting from the reduction in global auto production reductions. However, we were able to offset much of the profit impact and post a solid improvement in sequential profitability and more importantly industrial posted a sequential improvement in cash flow as well. So, as we look at the full-year as result of our combined cost reduction working capital improvement plans, we believe industrial businesses will generate positive profitability and solid cash flow. Textron Systems, we think about the Textron System's business while revenues were down on a year-over-year basis primarily reflecting slight reductions in unmanned aircraft systems and military training simulation systems as well as Lycoming commercial engine volumes. We do continue to see strong demand for this products. It's important to point out that, although, we had a lower comparison in the first quarter we will ship more UAS in 2009 than we did in 2008. The comparison only reflects a slippage of units from 2007 to 2008 in the first quarter of last year. So, despite this we still see very strong demand for UAS, our armored security vehicles and our Textron defense products for both US government as well as growing international opportunities. And so we had…

Thanks Scott. Going now back to our Q1 EPS from continuing operations excluding restructuring charges of $0.26, let's examine the major drivers that drove the $0.62 reduction from last year’s result. We are now on page nine of our schedules. As you would expect, the largest driver on the manufacturing side was lower volume which costs $0.67. We achieved positive pricing of 2.6% which added $0.16 per share. This was partially offset by $0.09 of inflation reflecting an inflation rate of 1.2%. As we mentioned, the CESCOM sale was worth $0.13. Overall cost performance benefited the quarter by $0.10, taxes provided a positive $0.04 on a year-over-year basis. And this reflects a $0.09 in discrete items this year compared to $0.05 in discrete items in last years first quarter. Discreet items this year were primarily due to benefits from a tax election enabled by Canadian legislation enacted in the quarter and the recognition of previously unbenefited capital losses as a result of the CESCOM gain. Lower corporate expenses contributed a positive $0.04 benefit and miscellaneous items including lower interest expense provided a $0.01. On the negative side of the ledger, used aircraft valuation adjustments at Cessna cost $0.03. This reflects 51 used aircraft on the balance sheet at the end of the quarter, with a carrying value of $247 million. Headwinds from engineering, research and development and depreciation cost $0.03 and the remaining $0.28 of the year-over-year decline came from TFC. With respect to TFCs managed receivable portfolio, schedule 10 shows ending balances among the categories of captive held for investment and held for sale. The schedule reflects the fact that we move two portfolios worth about $650 million from held for sale to held for investment as we determine that this assets would generate greater value if we were to perceive orderly liquidation there instead of outright sale. Turning now to our full year outlook, you can find forecast of segment results on page 11 of the schedules and page 12 provides forecast of corporate P&L items. You can see that our new outlook incorporates lower interest cost reflecting net savings from having drawn our bank lines and our outlook also includes a number of tax benefits expected to incur during the balance of the year. We will wrap up by mentioning that our manufacturing free cash flow outlook of $400 million includes expected pension plan contributions this year of about $70 million and cash restructuring cost of about $100 million. With that, Kent we are pleased to take calls at this time.

Great. Thank you very much. (Operator instructions) And our first question in this morning comes from the line of David Strauss with UBS, please go ahead. David Strauss – UBS: Good morning, thank you.

Good morning, David. David Strauss – UBS: The securitization that you have remaining for the rest of this year $2.3 billion. Can you tell us how that kind of plays out through the year what comes due Q2, Q3, Q4?

Hi, this is Tom Cullen. The total liquidation is going to about billion in the second quarter and it's reduced about $900 million in the third quarter than finally about $500 million in the fourth quarter come up to the roughly $3.1 billion for the full-year forecast.

David by the way that was Tom Cullen, CFO of Textron Financial and for the benefit everybody else listening. David Strauss – UBS: Great, thanks. Moving to Cessna, Lewis on the 290 to 300 revise production schedule, what portion of that you actually sold on and could you also just comment on how the service business is performing?

Sure. Well we have sold possessions of 295, so right in the middle of that spread. So that's fact number one. Fact two, the service business is doing well. The only comment I have to make though is that we are doing well for the business we are getting. We still have strong service business but on the other hand with aircraft usage down you do have necessary less opportunities to do overall and repairs etcetera, so I think rolling will be up slightly this year versus last. David Strauss – UBS: Okay. My last one on the $400 million forecast for manufacturing free cash flow. Does that assume the working capital is basically neutral for the full year?

No, it doesn’t. It reflects significant reduction in working capital across the businesses. Most of which we are already starting to see. The one area where we have not yet seen in a reduction in working capital, Cessna and that’s really just a function of the fact that our production plan because it was so high coming into the year declines over the course of the year, so we have a fair bit of finished good inventory that’s been manufactured in Cessna in the first and second quarter. But that will play out as those aircraft were sold in third and fourth quarter, but in net we are seeing reductions and would expect to see further reductions in working capital over the course of the year. That are part of that $400 million plan.

David it's a plus or minus is around $225 million in working capital fees. David Strauss – UBS: Okay. Thanks guys.

Thank you. And our next question comes from the line of Cai von Rumohr with Cowen & Company. Please go ahead. Cai von Rumohr – Cowen & Company: Yes, thank you very much. You mentioned suspending the Columbus program, what does that mean for R&D assessment, where was it in the first quarter and where should we expect it to be for the year?

We are going to get that, we are out of schedule. We just got dig it up. Let me just give an overview on this of though and that is don’t write the Columbus of your radar screen because we have decided that we need to be careful with our R&D spending across a company and that program was going to take effect and be sold in the commerce about 2013 or so and until we know much more about the market it's going to be selling into we thought it was more prudent to suspend it and then to redirect all of our efforts to invest in our existing core products at Bell and Cessna. So that’s what we have done. Now I don’t know math, do you have math on the actual R&D spend.

Yes, if you looked at 2009, we would have forecast the funding this year around 285 that’s ramping down obviously we were probably in the year now depending someone on Columbus and we will have some close our cost associated with it. We will taking that down to run-rate more or like $242 million a year. Cai von Rumohr – Cowen & Company: And where was it in the first quarter?

Hold down just a second while I have to get that for you.

While he is digging that up, Cai can we talk about anything else, while we will address that. Cai von Rumohr – Cowen & Company: I have, yes, a very quick question, in your 10-K you mention I think that you are going to have to make $370 million in pension contribution in 2010 and 11, what does that number look like today given you had more layoffs, any guidance on that or rough color?

Yes, as we said in our prepare remarks, we are looking at about $70 million this year, next year it's drive to about $50 million to $55 million. Cai von Rumohr – Cowen & Company: Yes.

But we are still looking at that higher level going into 2011 and that’s all reflected in our liquidity outlook.

Cai, one of the things on our liquidity model is, it takes about two pages in order show all the line details that we show or for our own use. So some of these things are collapsed in other line item, so apologize for that.

Hi Cai, its Scott, actual spending in the first quarter at Cessna was just a little over $82 million. Cai von Rumohr – Cowen & Company: Excellent, thank you very much guys.

Yes, okay.

Thanks. And we have a question from the line of Ron Epstein with Banc of America. Please go ahead. Ron Epstein – Banc of America: Hi, good morning guys. How many white tails do you actually have right now and how big is your inventory of used Cessna jets that are on waiting to get sold?

We said, we gave already numbers prepared remarks in terms of used and for market reasons we are not going to give you an exact white fair number that we’ve got now and obviously, we are building inventory in the first half and hopefully to see that flow through in sales in the second half. Ron Epstein – Banc of America: Well, I think I am curious, how that happened? I thought, you guys had all process and managing the backlog, it control over your sales force. I mean how did we getting up in a situation when you do have any white tail.

Well, I think if you are remember, going back to, middle to later part of last year, production forecast were one point around 500 jets and so you had a whole supply chain, suppliers, internal production, in terms of number of labor and production line rates were designed to do that. And so that team has been scaling back in terms of both our in-house workforce and going out working with our suppliers but the fact the matter is, the relatively long lead associated with a lot of that material. So the most efficient way to manage this ramp down has been, you do what as we take our own internal labor down as we are able to turn off that incoming supplier material. So if you look at the year and again as we did taking labor out and saw incoming stream it doesn’t happen overnight. So as we ramp this thing down, you are obviously, you have a lot higher build rates in the first quarter and second quarter than the third and fourth quarter, so, the plan that we have right now and we obviously just announced in other round of way off, in the business, is to continue to bring that production rate down but it does take those periods bring those curtail and again we had an off a lot of long lead material that was in the pipeline through our supplier. So, obviously we take that in consideration, so as we continue to try balance production versus demand but it will result in old production the first and second quarter. Ron Epstein – Banc of America: Now, Scott, I mean how should we think about, I guess the margin in Cessna if you normalize out the $50 million (inaudible) of the CESCOM asset or just under 5%, I mean when we think about where should Trauff [ph] margins be in that business, when you are add say Trauff delivery.

Well I think, we probably are in that Trauff, I mean, cost as coming out, I think we probably bottom on that margin rate, he saw that we will maintain, out or above that rate even with lower volumes through the balance of 2009 and lower volumes in 2010 as well. Ron Epstein – Banc of America: Okay. And then just one last question follow up, when David ask how should think about you are getting to your cash flow guidance given that you had such a cash outflow this quarter, I mean, I just don’t understand how you are going to get there, help me understand that?

Sure, I mean, if you look at the balance I mean I think we had at or better than what we have planed pretty significantly in fact out of most of business in terms of reductions and working capital and overall cash efficiencies the only thing that offset it was the build up on inventory coming through Cessna, I know, you know first quarter was always difficult quarter for us from a cash perspective just because – that number reflects not only the operating businesses but all the corporate cost things like hedging against stock based compensation things like that, which were cash outflows in the first quarter. So there is some unusual things that don’t occur in this first quarter, which obviously was factored into our plan, but I would say from an operation perspective, the big swing is really the reductions of those inventories Cessna in the third and fourth quarter.

Yes, let me add one more comment to that, because I know that Scott mind when you look at the charge we put up you here in the numbers we've talked about obviously we are pretty strong in that $400 million number for the end of the year and just another fact which you may know about I just I said in my opening remarks but you may have missed it, we had because we change the way we incentive pay the top 1000 managers. We changed our annual incentive compensation or our bonus formula if you will and I should have mentioned that 50% of the top 1000 managers in the company, 50% of their bonus which is always targeted as a percentage of their base salary lets say its 30% and then half of that 30% or 15% will be based on them making their stretch cash targets. We never done that before but we have had experience in redesigning the comp system to gain improvement and a metric most notably ROIC [ph] when we went from 8 to 21. So I would be very surprised and disappointed if we don’t see the kind of improvement that our managers are signing up for. Another point may not be obvious, Cessna is still a strong cash generator in '09, '10 and '11. And so our balance system, so 80% of the company are very strong positive cash flow generators. Ron Epstein – Banc of America: So, just want to following to those comments.

Yes. Ron Epstein – Banc of America: With the Textron Six Sigma, the engineering of Textron I would have expected in the downturn that may be Cessna would do better but it looks like you kind of going back to the historical performance of Cessna in a downturn. I mean how should I think about the impact of the both that whole program for the company and in industrial downturn. I mean to me it doest look like its paying off in the downturn.

Well if you would remind me to respectfully disagree with you in front of about 160 people I would like to, because – Ron Epstein – Banc of America: That’s fine, that’s great.

I know, I know, look it takes a Herculean effort to be planning to run at about 500 plus deliveries in October of '08 for the calendar 2009 and then take that number down to 290 to 300. That is a tough thing to do. Secondly if you think about it although we manufactured planes about (inaudible) more efficiently in most others. When you think about it you can't just stop, and you cant just change the production and pull plans out of the sequence. You get stuck actually making a plan if someone cancels on in the first quarter so then what we have to do to move up someone out of the second quarter, third quarter or 2010 which we been pretty successful in doing. So although it would appear to you and I don’t blame that they are saying that our numbers are different than you might have thought. I'll give you another interesting comment. Back in 2001 when our margins, 2002 and '03 when our margins dropped as a result of 9/11 we were not production any Mustangs, Mustangs have a very low profit contribution. So if when you take a look at the mix of businesses we have to factor that in to, when considering the number we are producing I would say our margin has held up pretty darn well in fact most people believe that had we not had Six Sigma and Lean in place we'd have been much worse off. Ron Epstein – Banc of America: Great. Well thank for all the comments guys.

Yes.

Before we go to the next question I just want to follow up Ron because I think your question about cash flow is one that is on the top of a lot of peoples mind and even though in the overall scheme, our overall liquidity plan it’s a small piece. I really want to understand, if you look at the mid point of our range that results in manufacturing net income of about 255 million. And when you go down through the map to get the 400 that’s going to require an increase or a contribution from working capital of about 225 million. So its not that big of a stretch when you think about it in those terms because obviously as Scott explained in the first half of the year we've got the momentum in the production process at Cessna and to a extent that we saw those in the second half of the year that working capital is going to recover. Not to mention all the programs that we have underway to just streamline our supply chains. So if you doubt that we are going to able to sale al those planes in the second half of the year then you just move it out to 2010 again as Scott kind of explained. So the cash flow from manufacturing operations over the next two years I think we feel pretty comfortable about the cumulative $900 million on our schedule there.

The other items for the quarter we talked about interest and taxes and comp programs and various expenses the run rate for the year is $500 million to $600 million. We will have spent or we did spent close to 300 in Q1. So, essentially you will see substantially less cash used than those categories in remaining three quarters than you did in the first. Ron Epstein – Banc of America: Okay.

Yeah. Al right next question please.

Great thank you your next question comes from the line of Steve Tusa with JP Morgan.

Hi Steve. Steve Tusa – JP Morgan: Hi, good morning.

Good morning. Steve Tusa – JP Morgan: Just a question on the can rate going into the second quarter, how front end loaded was toward cancellation in the quarter and where you are seeing as you kind of get out of first quarter?

Steve, the cancellation rates I mean its bit lumpy. So I think that what the trend we are seeing is that we are starting to see a tapering off of cancellations that relate to aircraft deliveries for 2009. We are still continue to see cancellations in 2010 and 2011 timeframe and frankly I think we will see than you should expect to see significant cancellations in the second quarter, although primarily associated with aircraft or related your deliveries. In particular, having announced the suspension of the Columbus program for instance you would expect to see quite a few cancellations of Columbus orders in this quarter across those are deliveries who are out in 2014, 2015 timeframe so. Steve Tusa – JP Morgan: Okay. So you will take those at a backlog you consider those cancellations and those who come through mostly in the second quarter?

Yes, that's correct. Steve Tusa – JP Morgan: Okay. And on that front I am just interested when they go in a backlog I assumed that there was a deposit, what are the timing is to what you have to return those deposits?

Well, I think if you look at something like the Columbus where it's result of customers' cancellations result of our suspension in the program you expect to see that cash flow virtually immediately back to our customers. Obviously that's a very different situation and our customer might cancel when aircraft is almost complete in which case mostly as we are keeping majority not all that the deposit account for remarketing and reconfiguration there. Steve Tusa – JP Morgan: But you said that the $2 billion backlog you had of Columbus, is it fair to say that like 10% of that and that's kind of mostly you are thinking about?

No, the amount of deposits that we have on Columbus it's still over date.

It's about $50 million worth of deposits that we had taken on Columbus. Steve Tusa – JP Morgan: Okay. From the net manageable. And then just on commercial helicopters what was the orders in the quarter? And what was that year-over-year?

Our net orders in and out of the backlog, Steve where on a unit basis were slightly negative and on a dollar basis were slightly positive.

Generally the trend that we are seeing, Steve is we had some cancellations that have been primarily in the 407 and 206 of the lighter or smaller helicopters and where we seen the strength in the orders has been in the 412s, which is… Steve Tusa – JP Morgan: You are saying slightly negative on year-over-year comp per basis, or all in that cancellations?

All in that cancellations. Steve Tusa – JP Morgan: Okay. And then one more question is on how quickly you noticed that production doesn’t really ramp down, so does that mean we are having other season where we done free cash period in the second quarter, I know cash is tough to predict, but you seem to be predicting it with a pretty good visibility here outside the year. Is second quarter also negative?

Assessment, we will still have cash consumption assumption for it. Steve Tusa – JP Morgan: And for the company?

No, I would say that it could be closed.

Close to even there.

It's going to be closed. Steve Tusa – JP Morgan: Okay. Great. Thanks a lot.

We worked ahead of our plan, in Q1 we are working hard try to get that in Q2 as well. Steve Tusa – JP Morgan: Okay. Thanks, guys.

Great. Thank you. And our next question comes from the line of Noel Poponac with Goldman Sachs. Please go ahead.

Hello, Noel Noel Poponac – Goldman Sachs: Hi, how are you?

Good. Noel Poponac – Goldman Sachs: Little more clarity on the assessment numbers, how many of the 290 to 300 are most tanks?

The mostly of the 295 is probably going to be somewhere in the 120 to 130 range. Noel Poponac – Goldman Sachs: Okay. So, that's not really changing?

No, most tanks are actually holding pretty well.

Most tanks are fairly easy because we have a such a big backlog, so as we seen the customer mix shift little bit that's can be our number. Noel Poponac – Goldman Sachs: Yes, that makes sense. And gave us a sold out number for '09, can you tell us how many aircrafts are sold for 2010?

We can't believe it. Actually right now we feel pretty good about 2010 on the order book, but I don’t think it's smart to put that number out there because until we see cancellation is stabilized and as Scott mentioned there attending to rate softening some, so that's good. Right now I will be happy if we went through the year and started from where we are and build slightly in 2010 that would be a pretty good year for us. We know exactly what our production schedule. We’ll be down that run rate by mid-2009 and that’s kind of how we see. Noel Poponac – Goldman Sachs: Okay and you’re taking up the full-year target for the run-offs at $3.1 billion you know obviously it’s been successful to-date but you guys had sort of alluded to you know if you had early success you maybe want to pull back for collateral and had alluded to you know not wanting to take up the target because you know you would be pushing people into a greater loss position. Can you just tell us how that’s split out has made has the better credit market made it a lot easier to move people to other sources of financing and so the losses are as better, what’s your thinking in taking that target higher?

Well there is a number of things on I think primarily our philosophy on this is that as we went through the first quarter we had originally set our target. We obviously more than – I mean we almost doubled it so we had a dramatic improvement like a couple of things one is that because the economy has still been pretty tough. A lot of the dealers that we work on finance are also being cautious about increasing their inventory. So, in many cases as those customers sold those assets. We got paid. So moved the receivables of cash and in many cases they didn’t finance up because they didn’t want to increase our inventory. Now we have actually gone past the period where we're committed to phone them and so we don’t have a financing requirement going forward so when we laid out the original plan, we had assumed that we’ll have to do more financing in the first quarter until we had given a notice period to these dealers who’re not going to financing going forward. So, basically what happened is we're taking all of the improvements in the accelerated receivables reduction that we achieved in the first quarter and since we're making that additive to our plan for the year so right now really what we're doing is executing at the plan we would have expected in the balance of the year and by the way so far that’s going right on track. So, if you take what we over achieved in the first quarter and add that to the $2.6 billion with the $3.1 billion. Noel Poponac – Goldman Sachs: Okay, thanks a lot.

Thank you and we do have a question now from the line of Heidi Wood with Morgan Stanley. Please go ahead.

Good morning. I wanted to focus a little bit on, I understand that can you describe to us a bit your bookings policy and how that stands vis-à-vis other OEs in the industry, I'm just trying to understand you know given the decreased cancellations we've seen in the less-than-twelve month timeframe. How does that give us confidence that your contract terms are really and truly firm?

I can start with it, we have had the same contract terms for (inaudible) since. I have been here and came in 92 basically the same. Let me say how they work and the basement when you put an order you actually make a non-refundable deposit or we do not count it as an order. That deposit is approximately a quarter of million dollar, okay, and then depending on the model and the price for the model you then have to make I’ll call it progress deposit payments all of which are non-refundable. For the large planes eighteen months prior to delivery you may have to put a million dollars. So now you’re a million and a quarter in. A year prior to delivery you make another deposit of a million dollar so now you’re two and quarter in and six months prior to delivery you make another million dollars so you’re three and a quarter in and that will be true for the Sovereign Citation term. Now just to make this quick so I want to do is one item. If you slide down to the XLS which would have a list pricing about $11 million you’ll have your first quarter to million in and then you would make nine months and six months pre-delivery payments of half a million each so you'll have a million and quarter in. if you cancel and you provide us a notification that you’re canceling we then follow a procedure where we have to inform you that we intend to keep that plane that deposit. If you’ve got a loan with the bank, the bank has the option to buy the plane and if they turn us down then we keep the deposit and you have no access to it and that’s been in-place and we use that religiously and we have to admit though that in a hot year if we are at a year of strong sales and something happened that we thought was reasonable from a good customer. Now remember 70% of our customers. I repeat then we might make a deal with you to say look okay. We're going to keep your deposit. We're going to keep all the interest on your deposit but let’s see if you can book another order in 2010 or 11. Obviously, that’s not the case this year because the cancellation rates are higher and the production volumes are down. So, we keep the deposits.

Alright, thanks. But it still, I guess, one would always think that the near-term deliveries would be firmer than the further out ones but, you talked about knowing exactly what the production schedule is for 2010 and yet again there has been a 50% decline in your deliveries for ’'09, between what you guide in October versus what you are guiding now here in April. What processes are you engaging and that gives you better visibility for next year than you feel that you had this year and can you also touch on what's been going with pricing because obviously was rising inventory. You got to be challenged on the pricing front.

I mean these are pretty extraordinary times. So I think it is very hard to go back and compare how those process plays out versus how it is playing out today. I mean I don’t think that we have ever seen a period of time where you have customers to get to a point where they have actually picked interiors. They have don’t paint, everything and at the last minute want to walk with aircraft. And I think it is driven by the general economic situation. I think we have cases everyday. A customer comes in. They made all the deposits. They have actually come out. They have done the paint. They have done everything they want on the aircraft. And they try to turn around inventory of 10% to 20% of the workforce. So, when they come back and say look we just can't – we can't fly in our new airplane in to our account, having just laid off a bunch of our employees. So, as we said. We work for the customer like that. Many of this are already customers and they probably would came back. But it is not going to be this year. So, I think these are pretty extraordinary times. We talked about where we are in '9 and what are our visibility is into 2010, again not a process we had to do in the past but we are trying to maintain very regular communication with our customers. If you look at our production schedules both for this year and next year, we look at every quarter number, we talk to every customer, we try to assess the risk, is the customer going to stay in the backlog, is the customer going to cancel. So we are talking to them. We are talking to some cases to their financial institutions, understand and make sure the financing is solid. So, I mean I wish I could tell you that we had perfect visibility and clearly we don’t. I don’t think anybody in the industry does.

No, I am just trying to understand if this process is giving you additional insight to better know how to base line 2010. I mean, obviously, 2009 is going period. That’s clear. But obviously there is a learning process as well. So, I am just trying to understand if there is a new aspects to the conversations. It does give you a reason to have confidence for 2010, that would be greater than 2009. And also please touch on pricing.

I am sorry. So, anyway, I think what the new process is that the number of contacts, we had communication with the customer to understand where they are, are they really in the backlog, are they really going to move out, or are they really going to cancel is much greater than it is ever been before. It is not a perfect process. We still have customer that shows up when something change at the last minute. But I think the visibility we have on the balance for 2009 and then through 2010 is all derived by that level of contact in trying to understand exactly what's going on for every single customer situation, which we just never had to do before. On the pricing front, clearly there is pricing pressure in the industry, used aircraft values in particular have dropped significantly. What we have been doing is on the new aircraft side, we are not moving on those pricing, we are working with customers to do special things, say maintenance and support kind of activities so we can give them some additional value to them to taking aircraft, to coming to order book, in some cases beyond what we would normally like to do, but we are trying to protect pricing of the new aircraft. On the used aircraft front, obviously that’s a very dynamic market, and we do have some special programs, we are running right now, in order to move our used aircraft, where customers are interested but are concerned is it going to be a further reduction in the we value of that aircraft, in some cases ,we are actually going to guarantee that values so we will give the customer a several year window. They take the aircraft, they pay for the aircraft, right to put that aircraft back to us at the end of that term or deal the trade-in to something else and so where base could rise. We think that’s in the best interest of moving that used aircraft, bringing the cash in and getting customers back out there and using this aircraft.

Alright. Great. Thanks very much.

Sure.

Thanks. And our next question comes from the line of Robert Stallard Macquarie. Please go ahead. Robert Stallard – Macquarie: Good morning.

Hi Rob. Robert Stallard – Macquarie: First question, you had obviously quite a few cancellations in the quarter. I was wondering if you could give us some flavor where it's coming from in terms of geographical distribution. And I think possibly industries that accounts (inaudible)?

Well, Rob, the distribution as I said is roughly about half 2009 deliveries and half future deliveries. I know how the data thing puts in but I haven't seen any trend of specific segments or specific kinds of individuals or companies that are canceling. Obviously we get a very broad range of different sort of root causes for the cancellations. Many are the just general economic conditions and remember a lot of our aircraft because they are the small to midsize aircraft or small companies, I mean, in some cases work individual but generally they are registration new corporations and represents a small businesses. I think in generally you see a lot of people that you have a difficult situation of their business which can either manifest itself, it difficulty getting financing. We certainly see some of that or as refer to earlier, just (inaudible) a lot of people and don’t feel like, it looks right for them to come in brand new aircraft when they are in the process of laying off bunch of employee, so which I think if you go back and you look at the trends which I think you probably as familiar as anybody with that business jet industries won the cycles very, very highly correlate US cope for profits. So, in times are good, people are buying aircraft, when times are not they differ or cancel those aircraft. So historically that has been a very, very hard correlation factor and frankly we would expect that going forward. So as you see the economy strengthen people start brining employees back in and the company start doing better we would expect also to see the demand for the business just pick up again. Robert Stallard – Macquarie: 12 months ago, you were talking about the international side to be very strong. It came to by a 50% of orders, have these new international customers proved to be more speak even some of your US customers or picking the calls when you are trouble?

I don’t know if there any particularly statistical difference at this point rather we can go kind try to chase that data down but you are seeing the situation both domestic and internationally. I know you pick up some international orders here in the quarter and we certainly shipping a lot of international aircraft but we’re still on balance or shipping a lot of US aircraft as well. Robert Stallard – Macquarie: I just finally, Lewis, you said that you went looking to Cessna's core assets, are there any non core assets that you might be interested disposing on that the next 12 months?

Well I don’t think it would be fair us to comment on that. I think it best for us to kind of keep things close until we announce we have got sign of distribution sales but I just couldn’t comment on that. If we were, if we weren't, I apologize for that. Robert Stallard – Macquarie: Okay. Thanks very much.

Sure. Alright kind understand there are no more questions in queue. I just want to do one clarification earlier I think David Strauss ask a question about the securitization and amortization to the rest of the year, and I think we misunderstood and gave a full manage receivables amortization. So, on the $2.262 billion of securitization it actually amortizes 490 in the second quarter, 757 in the third, and 335 in the fourth for the full year amount. So with that, that concludes our call, and we thank everybody for your interest in Textron and we will talk to you soon.

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