Good morning. My name is Jody and I will be your conference Operator today. At this time, I would like to welcome everyone to the Valmont Industries, Incorporated. First Quarter Earnings Call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question-and-answer session (Operator instructions.) Thank you. I would now like to turn over today’s conference to Mr. Jeff Laudin, Manager Investor Relations. Please go ahead.

Thank you, Jody. Welcome to Valmont Industries’ first quarter 2014 Earnings Conference Call. With me today are Mogens Bay, Chairman and Chief Executive Officer and Mark Jaksich, Executive Vice President and Chief Financial Officer. Before we begin please note this conference call is subject to our disclosure on forward-looking statements which applies to today’s discussion and will be read in full at the end of the call. The instructions for accessing a replay of this call can be found in our press release. I would now like to turn the floor over to our Chairman and Chief Executive Officer, Mogens Bay.

Thank you, Jeff. Good morning everyone and thank you for joining us. I trust that you have all read the press release. We experienced some softness during the first quarter, but we still achieved the second highest first quarter results in the company’s history. We had a very tough comparison as last year’s first quarter saw earnings up 48% from the previous year as a result of exceptional performance and the Irrigation and Utility segments. These two businesses still deliver a strong quality of earnings during the current quarter, but not to the record level we saw a year ago. In the Irrigation segment the first quarter unfolded in a more typical manner as we did not have the record backlog going into the quarter that we experienced a year ago. Commodity prices had dropped sharply leading to expected lower net farm income in North America and that in term probably put a damper on farmers’ enthusiasm for equipment purchases. In our International markets we saw continued growth in both revenue and earnings. This growth was broad-based geographically. International markets in many parts of the world are in the development phase and often more sensitive to policy decisions than to commodity price fluctuations as compared to the North American markets. The quality of earnings in our Irrigation segment at 20% operating income to sales was very satisfactory. We have seen good pricing discipline in the U.S. market and retaining that pricing discipline is going to be important to deliver a good quality of earnings for the reminder of the year in a softer market environment. Recent political tension in potentially large future Irrigation markets, Russia and the Ukraine were probably lead to a pullback in our level of activity and those two countries. However, we do not expect to have…

Thank you. (Operator Instructions) Your first question comes from the line of Nathan Jones – Stifel. Nathan Jones – Stifel Nicolaus: Good morning, Mogens, Mark and Jeff.

Good morning, Nathan.

Good morning. Nathan Jones – Stifel Nicolaus: Just on the utility margin my guess is where I would like to focus. As of last quarter you had said that for the first quarter you did expect increased revenue on lower profitability, revenue was down 10% and profitability was obviously down. It looks like the majority of that came from press with probably some impact from lower international revenues. Can you talk about kind of what changed later in the quarter I guess that at result came in lower than you were expecting?

What I would say – first of all international revenue, even though international came on an annual basis its not a significant part of the overall segment revenue, in the first quarter of last year it was and this year international revenue dropped dramatically because of lag of projects, so that’s part of the explanation. Also in North America, we had a couple of projects that we expected to ship in the first quarter that moved out to the second quarter. Nathan Jones – Stifel Nicolaus: And did you see the pricing deteriorate as the quarter went on, and are you expecting pricing to be more challenging going forward than it was in the first quarter or have we found an equilibrium point or what is your outlook for margins there?

Well I would say that on margins – from a margin standpoint I think we are going to see operating margin as a percent of the sales to be in the lower range, the lower end of the range of 15% to 20%. As we have talked about before, depending on where we are in the cycle the profitability will move. Actually in those kind of businesses a 15% operating margin is a pretty attractive margin and a good return on invested capital. What we have over the last couple of years to see in those margins in certain quarters above 20%, I don’t think we are going to see that this year, but I also don’t think that before the year we are going to drop below 15%. Nathan Jones – Stifel Nicolaus: I mean what do you think the risk is to that, I mean in 2010 downturn in that business, I know I the revenue decline was a lot more severe there, we got down to kind of low-double digit. What do you think the risk is there, the pricing – the rationality in the market deteriorates and we could get down to that level? How would you handicap that?

I wish I could, let me start with what we do control. Over the last 10 years that business has grown from about $100 million to close to $1 billion and therefore by far the most efforts in managing that business as gone into adding capacity, building the organization to be able to serve our customers well and to retain of in market share. In the current environment have to switch our focus, just like we did in the engineered infrastructure product a few years ago when those businesses faced some headwind. And we are going to focus more on making the capacity we have more productive, so that’s going to offset some of whatever pricing challenges they are going to be. The extent of the pricing challenge is actually obviously out of our hands. Since we expect that market to continue to be a strong market over the next few years, they really should be no reasoned to have more downward pressure in a pricing sense, but we are only one thought of that equation. Nathan Jones – Stifel Nicolaus: All right, thanks very much.

Your next question comes from the line of Julian Mitchell from Credit Suisse. Charles Clarke – Credit Suisse: Hi, guys thanks. It’s actually Charlie for Julian. I was just wondering what gave you guys confidence that the back half of the year for irrigation would be flat both in terms of sales and profitability versus last year. I just didn't know how much visibility you have in the book today.

But as we have said many times, there is not a lot of visibility for the second half of the year, but last year second half we saw return to more of a normal selling season. The euphoria that was driven by the drought conditions that the year before that in 2012, had abated and we saw more normal weather pattern and we have already experienced some of the decline in commodity prices. And when I go back a year further and look at the second half of 2012 that’s about in line with 2013 and what our expectations are currently for 2014. So the reason I would may be turnaround say we don’t have much reason to predict that it should be any lower or any higher, but kind of using the smell test it kind of feel that its commodity prices stable they are now there is a little more optimism in the market if growing conditions, which not ideal so far because of dry areas in many parts of the country. That should be a good platform for business in the second half, but as I said in my prepared remarks you know its very difficult at this early in the year to predict the second half, but and we feel pretty good about it. Charles Clarke – Credit Suisse: And then just one follow-up, some of you guys closed this deal in March, congratulations on that. Just didn't know if you had any update on whether or not we should expect more deals and whether or not the guidance would have been lower without the deal.

Well, for the guidance would have been low without the deal because we expect the deal to add to earnings this year. And as I said before we have a number of opportunities we pursue, but first of all you can predict when companies are available that we would like to acquire and secondly you can predict if we can acquire at a valuation that will allow us to beat our cost of capital. And we have to make sure that we don’t let debt capacity or cash on our balance sheet soften our stand when it comes to returns. Charles Clarke – Credit Suisse: Thanks.

Your next question comes from the line of Arnie Ursaner from CJS Securities. Arnie Ursaner – CJS Securities, Inc.: Hi, good morning.

Hey, Arnie. Arnie Ursaner – CJS Securities, Inc.: My first question, just a clarification, Mogens, when you provide EPS guidance, you're doing it on GAAP, not adjusted. Just to be clear is that correct?

For this year, we do it on GAAP, the range I gave you was on GAAP. Arnie Ursaner – CJS Securities, Inc.: Right, so on the adjusted basis it would be higher than the GAAP?

For 2014? Arnie Ursaner – CJS Securities, Inc.: Yes.

I'm going to have Mark answer that question, Mark is that…

No, I don’t think there was – if I understand the question. Yes, I mean you – in a way the $0.13 we took on EMD yes that is outside GAAP. So in a way from operations you can have that $0.13. Arnie Ursaner – CJS Securities, Inc.: That what I was just trying to clarify thank you. My next question relates to the acquisition of DSSM, which you bought in the quarter. At the time you bought it, you indicated it had annual revenue of about $190 million and you thought the margins would be consistent with the EIP piece.

Yes. Arnie Ursaner – CJS Securities, Inc.: If I'm correct in my math, it looks like year-over-year it probably grew at least 13% and the margin was closer to 11%. Is that the way we should think about that business for the upcoming year?

Well, this is the way we should think about it. First of all down – SM is also very project oriented, its big structures they sell and they have very big customers. And the month of March turn out to be a month of good shipments, so I would not automatically take those results and multiply them by 12. I would still say that the revenue is going to be in the $200 million range and I think that our operating income should be around 10%. Arnie Ursaner – CJS Securities, Inc.: Okay, you are not expecting significant growth in that business this year?

Not currently. Arnie Ursaner – CJS Securities, Inc.: Okay. And my final question goes back to pricing and comments related to utility and I guess I've been involved with you guys for years, but I’m not sure I understand what you are really trying to tell us on price. It seems as though pricing has gotten more competitive, because people are trying to fill in the pipeline on a shorter-term basis, yet my perception of that business is most of the orders you might book in Q1, are things that are going to ship two quarters or three quarters later. If trends were impacted in Q1 by weather and some softness, why would that be leading to a lot of pricing pressure? I'm not sure I fully understand that that dynamic.

Well I think that, you're correct with the visibility on large projects, but there's a lot of big businesses on much smaller projects that takes place all the time and its that part of the business that has seen more pricing pressure and that pricing pressure you will see the effect of much sooner then you will be larger projects we have in our backlog. Arnie Ursaner – CJS Securities, Inc.: Would have be fair to say that most of what you book in Q1 has been shipped or will be shipped in Q2 or is just likely to linger is the margin issue into Q3 and Q4.

It’s likely to linger in the sense that on the bid business a lot of what we booked in the first quarter of will probably shipped in the first quarter some will ship in the second quarter but there's been no indication that that pricing environment has changed in the second quarter for the bid business in this quarter. So unless that situation changes, we expect the quality of earnings in the segment to be as I talked about. Arnie Ursaner – CJS Securities, Inc.: Thank you very much.

Your next question comes from the line of Ryan Connors from Janney Montgomery Scott LLC. Ryan M. Connors – Janney Montgomery Scott LLC: Great thank you. Yes, my question is on this issue of pricing and USS. I wanted to focus really on the capacity situation industrywide because my understanding of what you've laid out his that's really the problem here rather than volumes per say. And I guess my question is obviously yourself and others have been adding capacity until very recently and in fact we've got new capacity coming online today really at least on a year-over-year basis new capacity continuing to hit the market. So my question is now that pricing is deteriorating, one would hope that any new capacity additions on the drawing boards by competitors have been or are going to be canceled and there's going to be an abrupt halt any new capacity additions if not then this issue should be exacerbated going forward. So can you give us any perspective or color you have on how the pricing situation is impacting you know the mentality in terms of the marketplace and adding new capacity?

Well I share your hope. But what happens is if you go back and look at what happened that industry over the last now nearly 10 years as very rapid growth and you have seen a little bit of a herd mentality for people that have not been in this business wanting to get into the business and probably some overreaction. We have been adding capacity. What we are doing this year is that now we are taking a lot of the outsourcing we had in previous years because we didn't have enough capacity and we are now utilizing it in our own capacity which is part of the cost reductions that I talked about that we are going to put in place and are putting in place to offset some of the pricing pressure. So I would guess that whoever follows this industry now will probably take a breather when it comes to adding more capacity until we see how this market settles down over the next couple of years. Having said that though we see no reason to expect the market in total to start shrinking. When we talk to customers there's lots of projects out there the timing of them exactly when they are going to happen is always a little answer, but what is on the drawing board is significant over the next few years. Ryan M. Connors – Janney Montgomery Scott LLC: Okay, its helpful and then a follow-up on pricing although across the portfolio of the irrigation. Mogens you mentioned that pricing will be key to how the remainder of the year plays out in terms of quality of earnings and margins in irrigation. What is your outlook and your handicapping of that? I mean historically when you do see lower volumes, you do see some degree of pricing pressure, so what is your – how do you handicap that playing out over the next say six moths to 18 months?

Well so far we’ve seen good pricing pressure in general in North America, international we have many more competitors and therefore its lets say all the pricing discipline in North America. In international markets we have many more local competitors and that moves around from region-to-region, but if the North American players will continue to stay disciplines as we have seen, then I think that the only deterioration in profitability, quality of earnings would be directly tied to leverage or deleverage as appose to also having to deal with pricing at the same time. Ryan M. Connors – Janney Montgomery Scott LLC: Okay, great. Well thanks for your time.

Your next question comes from the line of Brent Thielman from D.A. Davidson & Co. Brent Thielman – D.A. Davidson & Co.: Hey good morning.

Good morning. Brent Thielman – D.A. Davidson & Co.: One more on pricing side, but for the large projects you are looking at into kind of 2015 and 2016 maybe beyond, is there a reason to think the competitive landscape looks more favorable for there, because there is a narrow list of suppliers that can bid on these particular projects?

Well I would say in general, but don’t think its going to change over the next year or so, but I would say in general they have fewer players that can provide the very last projects, have the capacity and flexibility to do that and there are many more players that can participate into much smaller projects. I don’t think that environment is going to change. So what we see today is probably what we are going to see for a while. Brent Thielman – D.A. Davidson & Co.: And the works you are seeing today and this year, would you characterize these as smaller projects relative to what you are seeing over the next couple of years?

No I think the mix between smaller and larger projects may stay about the same, but it’s the smaller projects that have more people able to participate and therefore could create a more difficult pricing environment. Brent Thielman – D.A. Davidson & Co.: Okay, and then just one more, switching gears to the irrigation business, obviously great numbers out of the international keys. Can you talk about some of your growth initiatives there in terms of international, what you are looking at; I think you added some capacity in South America, maybe just some discussion there.

Well, in general, we had are very well covered geographically around the world in the markets one that are very developed markets like Brazil and South Africa and Australia and New Zealand and then we are putting a lot of efforts to some of the emerging markets and I just came back from a meeting last week in Istanbul where we had our global irrigation managers altogether. And it was nice to listen to them all talk about the opportunities happened and how they are addressing them. So I would say over the last couple years we have invested more in market development efforts around the world and that is starting to pay off. The nice thing about the international business as opposed to North American business is that the drivers are so different around the world whether it's local politics are local economic situations or local agricultural makeup. So those markets don't fluctuate as much in the total as we see in North America and as the international business continues to be a bigger, bigger portion of the overall Irrigation business, then the segment will probably have less cyclicality to it and then we have seen in the past. Brent Thielman – D.A. Davidson & Co.: Okay thank you.

Your next question comes from the line of Brian Drab from William Blair. Brian P. Drab – William Blair & Co. LLC: Good morning.

Hi, Brian Brian P. Drab – William Blair & Co. LLC: First on the acquisition you made recently I was wondering if you could talk a little bit more just about the strategic thinking behind that gives us a sense for what your presence has been in that region you know in Denmark in Scandinavia in general, can you share capacity with some of your other business lines can you make some of your other products within that plant. And then lastly can you give us a sense for how that business have been growing for the last year or two?

That's a lot of questions in one, but… Brian P. Drab – William Blair & Co. LLC: I know sorry. That’s too many thanks.

We have not had any facilities in Northern Europe in the product lines that Valmont is in participating. We like their manufacturing capabilities and their co-engineering capabilities with their big customers such as FEMA and others. We like the fact that they are located right in the middle of the biggest growth area for offshore wind and wind in Europe as a longer run rate and what we see what’s happening because subsidies et cetera are in place for longer periods of time, but we have seen in North America. So we like that participation particularly in offshore. They have also dabbled in but they have had good success in the Utility business making significant utility line in their home country. And we think that over time we can leverage their capabilities as we continue to grow the international utility business and I would also think that within energy in general whether it's offshore drilling where they have projects for offshore wind, onshore wind that we will find opportunities to maybe leverage some of their capabilities and product lines elsewhere in the world. On your question as to how fast have they grown over the last few years? They have grown I would say double-digits over the last two years or three years. We impressed with the management group they stay. The top management will continue to own 10% of the company, so they are completely tied their success to our success and we like that. Brian P. Drab – William Blair & Co. LLC: Great, just to clarify that double-digit growth annually or double-digit cumulatively over the last two years or three years?

Annually. Brian P. Drab – William Blair & Co. LLC: Annually thanks. And I guess just one more if I can ask on the coatings segment, it looks like revenue is down just a little bit sequentially, but margin step down about 400 basis points I guess sequentially . How should we think about modeling that going forward or is there any dynamics you can help us understand in the coatings segment that could be putting pressure on margin?

No I don't think in general. I mean we’ve seen some price in Australia volume particularly in the area where we serve the mining industry and when – you as we see good leverage when revenue improves, we see deleverage going the other way, so we've seen a little bit of that but in general the way if you look at the Global Coatings business that they are probably going to continue to operate totally at around 20% operating income which is very satisfactory. Brian P. Drab – William Blair & Co. LLC: Okay thanks very much.

Your next question comes from the line of David Rose from Wedbush Securities. David L. Rose – Wedbush Securities, Inc.: Good morning, I have a couple of follow-up questions. I don't want to beat it death on pricing, but can you be a little bit more clear or maybe help me understand on the utility support structures side, is implication that the environment one got more competitive from your comments in Q4 to today and two in your view is the market irrational or is it still rational? And that maybe…

l: David L. Rose – Wedbush Securities, Inc.: Okay that's helpful. And then if I could take a back half of the assumptions from Q1 to Q2 given that this was a quarter where fixed cost were probably under absorbed does that imply that were almost being equal that you should have increased absorption in Q2 and better margin in Q2 a step up from Q1? In that business?

I would expect margins at about the same level. I would expect revenues to increase in Q2, but I wouldn't expect any big impact from absorption. David L. Rose – Wedbush Securities, Inc.: Okay. And then if we could on the irrigation side, one were there any large products and irrigation international that you'd like to call out that may have driven better than-expected results.

No. David L. Rose – Wedbush Securities, Inc.: Okay. And then two is can you give be more specific on what drove the irrigation margins were there particular actions taken you know line reductions for worlds et cetera that may have helped improve productivity?

Well, I would say that having been as a company in the Irrigation business for 50 plus years and it being a cyclical business, we react fast to changes in market conditions. So we throttle back on cost then we throttle back on over time in the summer time we have a number of employees that actually like to be back farming or hunting or doing other things. So we have been able to adjust the workforce to reflect current volume. And hopefully we will be able to do that during the summer to. But these are businesses that are not only cyclical over time but they are also seasonal. So I think we are our irrigation people are pretty adept at adjusting employee level so we don't have a lot of unfavorable variances as having too many people around. David L. Rose – Wedbush Securities, Inc.: Okay great thank you I will be back in the queue.

Your next question comes from the line of Kevin Bennett from Sterne Agee. Kevin Coogan Bennett – Sterne, Agee & Leach, Inc.: Hey, guys. Good morning.

Good morning. Kevin Coogan Bennett – Sterne, Agee & Leach, Inc.: Two quick questions. First on irrigation, we have saw pretty good increase in first quarter commodity pricing. I am wondering if you guys saw an improvement in sentiment given that uptick or if you guys feel better about the business for the second half that maybe we actually could feel little bit higher than last year or if that didn't really change given what happened with commodity prices.

Well I would say start by saying we have not measured any material change in sentiment but clearly when commodity prices starts recovering a little bit and if you have fairly dry growing conditions if that continues to be the case that will translate into improved sentiments. So we are not euphoric regarding the second half of this year, but we are also saying that it could match the second half of last year and if you look within it, I would say maybe North America could still be on the weak side, but international should be on the strong side and in total we think they are going to be about flat. Kevin Coogan Bennett – Sterne, Agee & Leach, Inc.: Got it. Thanks for that and then one quick question for Mark. Corporate expense quarter to the pretty big step down and the lowest in a while. I’m wondering if there is anything going on there and if that’s a good run rate for the rest of the year or if its going to jump back up to that $18 million-ish level?

Well the nig drop in the first quarter corporate expense 1% and with our lower projected earnings for the year you should expect to see incentive to be quite a bit less than last year, the other part of it is, is there were some discretionary experiences that were not done in the first quarter of this year so looking forward, it sort of depends on whether those expenses actually happened. That number the $13 million too I think is a little bit on the low side it could it could be up a little in the next quarter but it won't approach anywhere near the $18 million or whatever we were incurring last year. Kevin Coogan Bennett – Sterne, Agee & Leach, Inc.: Got it. Thanks that’s helpful.

Your next question comes from the line of Jon Braatz from KS Capital. Jon Braatz – Kansas City Capital Associates: Mogens, all my questions have been answered. Thank you very much.

Thank you Jon.

Your next question comes from the line of John Dunning from BB&T Capital Markets. John Dunning – BB&T Capital Markets: Hey good morning guys, this is for John in for Schon. Just a quick question on galvanizing, we’ve seen zinc pricing come up quite a bit as you are in Q1, do you guys have any concern about being able to pass on that pricing through?

Well our coatings business, I mean this is the input cost, so we are pretty in-depth at passing on price increases to the marketplace and as I said North American profitability was up slightly compared to last year, so obviously they did a good job. John Dunning – BB&T Capital Markets: Okay great, thank you guys.

Jody, are there anymore questions in queue?

Yes sir, there are (Operator Instructions) your next question comes from the line of Nathan Jones from Stifel. Nathan Jones – Stifel Nicolaus: Hi again guys, just a few follow-ups if I could go back to irrigation for a minute I think probably a very, very good job I think on the margins in the first quarter that I think the deleverage given, the shifting makes as well which would be negative for margins would actually imply that pricing didn't degrade at all in the first quarter is that a fair assumption and in your opinion cannot dynamic hold in the market given these volume declines.

I think that’s probably a fair assumption and there are several players that have to determine whether it will hold. Nathan Jones – Stifel Nicolaus: I am sorry at this point would you say or confident that pricing will hold.

I have no reason to be either or too. Nathan Jones – Stifel Nicolaus: Okay fair enough. And then let me acquisition with 200 million in revenue and 10% operating margins I am assuming that is a cash operating margin and that given all the purchase price accounting and stuff that will be probably substantially lower this year. With regards is being on a non-GAAP basis can give us a bit more color on later expecting for the GAAP equation for that issue.

Yes, this was Mark. We don’t have all of the fair value assessments done on the acquisition is being worked on as we speak and that’s going to determine what the actual purchase accounting effects are going to be but I would say will be close to double-digit operating income for the year including the purchase price adjustments based on what we know today. Nathan Jones – Stifel Nicolaus: And then what are the cash margins.

Our cash margins… Nathan Jones – Stifel Nicolaus: To excluding that purchase price accounting.

Let be into the low double-digit. Nathan Jones – Stifel Nicolaus: Okay great thank you.

Your next question comes from the line of Arnie Ursaner from CJS Securities. Arnie Ursaner – CJS Securities, Inc.: Mark can you go back on the Utility piece on the international decline in project activity, highlight perhaps expand on that a little bit and maybe give us some better sense of the numbers involved.

Yes, since its usually we don’t break out internationally said in total internationally 10% of segment sales for the year, but I would say in this first quarter it was the profitability and international compared to last year probably dropped at least $0.05 or $0.06 per share the equivalent of $0.05 or $0.06 per share. Arnie Ursaner – CJS Securities, Inc.: Okay. And I know Q1 is relatively unimportant but just highlight again your exposure to China and the 4G network build out we are seeing basically globally and how that effecting your business.

Well, our exposure to China is not significant but its also not immaterial completely, and I would say that if you look back over our history in China, one of the strength of our China activity has been in support of the wireless communication business. And we’ve seen an uptick in activity this year in China as a result of 4G build out in that country as well. Arnie Ursaner – CJS Securities, Inc.: Okay, my final question is, one I know you get asked a lot by more perhaps aggressive shareholders, who look at your balance sheet and question the aggressive in this or your capital deployment. So maybe it's a multiple part questions, but remind us again of your targeted view of capital structure, how you are evaluating additional acquisitions versus share buybacks. Again, I may appreciate in the past share buybacks may not have made sense given the liquidity in your name, but that's drastically different today and if you don't do anything you're going to be in a net cash position which is completely inconsistent with your targeted goal in the past of 40% that the capital – help us reconcile those various issues?

You sound like you have already given the answer in your opinion, but let me repeat where we are. First of all our priorities for cash is a organic growth and then it is acquisitions that fit within our portfolio and our comfort areas. We do have a strong balance sheet. We do have a lot of liquidity and we all the time discuss with our board kind of a capital allocation strategy. And we’ll do that again at the upcoming board meeting. Now in the first quarter we spent well over $100 million in acquisition. If we could do that every quarter, count on it that it would be easy to answer your question, but we are not – we are very cognizant of the fact that if we don't see a prudent use of our balance sheet going forward, in the near-term. We have an obligation to evaluate returning money to shareholders in the form of either dividend or share buyback. And the way I look at stock buyback is how I would look an acquisition. It's a company we know better and if we think that's a better acquisition and something else we are looking at, we wouldn't hesitate. Arnie Ursaner – CJS Securities, Inc.: Okay, again. Thank you very much.

Your next question comes from the line of David Rose with Wedbush Securities. David L. Rose – Wedbush Securities, Inc.: I’m sorry a follow-up question to the acquisition. Just to be clear the $1.9 million in operating income from DSSM, is that EBITDA or that’s after – that’s a GAAP basis, that’s after amortization?

That’s GAAP basis. David L. Rose – Wedbush Securities, Inc.: Okay. So, your guidance the for the remainder of the year $10 to $10.50 again is a GAAP basis number and includes virtually everything, but is there any adjustment for that accounting that would change the guidance for the $10 to $10.50? If there's any purchase accounting adjustments.

I don’t think that would be immaterial... David L. Rose – Wedbush Securities, Inc.: Okay.

Relationship to the guidance and if there some one-time issues like we had with EMD shares in the first quarter we will point that out. David L. Rose – Wedbush Securities, Inc.: Okay that’s helpful. Thank you very much.

Your next question comes from the line of John Dunning with BB&T Capital Markets. John Dunning – BB&T Capital Markets: Hey, guys. One quick follow-up question more of a housekeeping item the $2.4 million other expense was a pretty large Delta compared to previous quarters. Just wanted to get a sense of kind of what's there in there and whether any of that's going to continue on into future quarters.

Yes. John this is Mark. That movement consists basically of two things. John Dunning – BB&T Capital Markets: Okay.

First thing is the core earnings on the assets that are in our deferred compensation plan. So this is an offsetting liability on the balance sheet or on balance sheet there is a corresponding decrease in SG&A. So that particular item does not affect earnings before taxes book keeping exercise we have to do GAAP purposes. The remainder of that difference is largely foreign exchange losses that we had on transactions. And those are basically categorized in two different ways. First of all is assets that were positions we’ve taken on the balance sheet for instance putting foreign cash let's say foreign operations but U.S. dollars in cash to cover expected purchases in U.S. dollars from a hedging standpoint and some of those cases that the dollar weakened against those currencies and so since we will get hedge accounting for that next go through the P&L. From that economic standpoint we’re hedging so we are not taking exposure. And that hit us in a couple currencies, most notably the Australian dollar and the Brazilian real to some extent. The other parts were just un-hedged or uncovered foreign exchange with our balance sheet exposures rate fluctuations. I would not expect that going forward to continue anywhere close to where we were in the first quarter. And we are taking some actions to mitigate some of those effects going forward. John Dunning – BB&T Capital Markets: Okay great. Thanks for the help.

Thank you. There are no further questions at this time. I will turn it back over to management for closing remarks.

Thank you, Jodi. This concludes our call and we thank you for joining us today this message will be available for playback on the Internet or by phone for the next week. We look forward to speaking to you again next quarter and at this time Jody will read our forward-looking statement.