Good evening, everyone, and welcome to the World Fuel Services first quarter 2010 conference call. I am Frank Shea, Executive Vice President and Chief Risk and Administrative Officer, and I am doing the introductions on this evening's call with as we have been doing in recent quarters a live slide presentation. This call is also available via webcast. To access this webcast or future webcasts please visit our website www.wfscorp.com and click on the webcast icon. With us on the call today are Paul Stebbins, Chairman and Chief Executive Officer; Michael Kasbar, President and Chief Operating Officer; Ira Birns, Executive Vice President and Chief Financial Officer; and Paul Nobel, Senior Vice President and Chief Accounting Officer. By now, you should have all received a copy of our earnings release. If not, you can access our release at our website. Before we get started, I would like to review World Fuel's Safe Harbor statement. Any statements made or discussed today that do not constitute or are not historical facts, particularly comments regarding World Fuel's future plans and expected performance, are forward-looking statements that are based on assumptions that management believes are reasonable, but are subject to a range of uncertainties and risks that could cause World Fuel's actual results to materially differ from the forward-looking information. The summary of some of the risk factors that could cause results to materially differ from our projections can be found in our Form 10-K for the year-ended December 31, 2009 and other reports filed with the Securities and Exchange Commission. We will begin with several minutes of prepared remarks which will then be followed by a question-and-answer period. At this time, I would like to introduce our Chairman and Chief Executive Officer, Paul Stebbins.

Thank you, Frank. Good afternoon and thank you for joining us. Today we announced earnings of $33.7 million or $0.56 per diluted share for the first quarter of fiscal 2010. Our returns on equity, working capital and invested capital were strong this quarter and our excellent cash position and overall liquidity continue to support our ability to fund organic and strategic growth. We are pleased with our strong first quarter results and are optimistic about our prospects for the balance of this year. In our marine segment we posted a sequential quarter-over-quarter increase in volume of 5%, the first quarterly increase since the second quarter of 2008. While the shipping market remained generally challenged in Q1 we began to see signs of recovery. Each segment had its own unique challenges. The container market still faced a weak rate environment and the prospect of additional capacity entering the market. However, those companies with sufficient scale to drive cost efficiencies will ultimately benefit from the rationalization of service in the market. The bulk market continued to demonstrate resilience in line with the global demand for raw materials particularly in China where a persistent drought and record steel production drove increases in iron ore and coal imports. Every indication is that this trend will continue throughout this year. More difficult to predict is the tanker market whose fortunes rise and fall with the energy complex. What seems clear is that best in class companies in this space have good balance sheets and continue to invest in fleet modernization. Any improvement in the world economy will certainly benefit this sector as the demand for energy increases. Overall 2009 was a very tough year for the shipping industry but we believe the worst may be over and demand patterns are expected to improve in synch…

Thank you Paul and good afternoon everyone. Consolidated revenue for the first quarter was $3.9 billion, up 11% sequentially and up 95% compared to the first quarter of last year. The year-over-year change in revenue is impacted by the increase in crude oil prices from an average of $43 per barrel in the first quarter of 2009 compared to an average of $79 per barrel in the first quarter of this year. The aviation segment generated revenues of $1.5 billion, up $107 million or 8% sequentially and up $750 million or up 106% year-over-year. While approximately 60% of the sequential increase was the result of higher average fuel prices, approximately 40% was the result of an increase in volume. Our marine segment revenues were $2.1 billion, up $249 million or 13% sequentially and up nearly $1 billion or 90% year-over-year. Approximately 67% of the sequential increase was the result of higher average bunker fuel prices with 33% related to increased volume. Finally, the land segment generated revenues of $360 million, up 5% compared to last quarter and up $159 million or 79% year-over-year. The entire amount of the sequential increase was due to increased volume. Our aviation segment sold 622 million gallons of fuel during the first quarter, up 3% sequentially and up 47% year-over-year. Representing the highest level of quarterly volume since the record volume posted in the first quarter of 2008 and sequential volume growth for the fourth straight quarter. The trough in our aviation volume occurred during the first quarter of 2009 when the entire industry was cutting back capacity and we were shedding higher risk business to reduce credit risk in what was an extremely fragile business environment. Just one year later our aviation segment has increased volume by approximately 200 million gallons per quarter principally…

(Operator Instructions) The first question comes from the line of George Pickral – Stephens. George Pickral – Stephens: Can you kind of give your outlook on the marine side? I think you said you were cautious but we saw a few dry bulk companies report this morning and they seem pretty bullish on the demand side. So maybe can you talk about how you feel about that market in particular and then your other markets and your overall feel of the marine market going forward?

Sure. You have heard me say in many calls over the years that eternal vigilance is the price of liberty. We take a cautious view just given the fact we don’t have a wholesale what I think anybody would feel comfortable in saying is a robust economic recovery on a global basis. As you know, shipping which is kind of the infrastructure which is moving all of the goods; as we have talked about 80% of the world’s goods are being transported by ship, we watch carefully just to make sure the signs of the recovery are real, are durable, that they go deep into the economies and that the changes are something we think are sustainable. So we approach the market with what we think is just prudent caution. When we look at the dry bulk market we are actually quite happy to see there has been a robust recovery and I think that has to do with what is going on primarily in China and India. You are right, some of the bulk carriers that are announcing are of course very, very happy to see that upturn and the strong demand. You have the drought in China. It is putting pressure on hydroelectric power. You have imports of coal that are helping to supply power. You have the issue around steel production. China continues to make huge investments in infrastructure. So I think the longer-term question becomes is this sustainable? Is this durable? Can China keep the machine going? I don’t know the answer to that any more than anybody on this call or anybody listening in, I doubt. We hope that is the case but I can’t give you any particular divine insight into that. When we look around the rest of the market I think the…

The focus is on the highest class quality customer. That continues to be our discipline driven by Frank and his team. That is reflected a little bit in the margin but I would say within sort of a movable range and band that margin doesn’t surprise us. It is sort of consistent. I think at the end of the day we have said this in the past, there has been a tremendous amount of obsession and sort of focus on the marine spreads and at the end of the day we are driving gross profit and we are driving the overall enterprise success. So it is the ultimate financial wellbeing of the company we are concerned about. If we can drive robust gross profit as a company we are less focused on that individual spread. I think ultimately it is about having a differentiated offering in the market that is second to none by continuing to make the investments in technology, people, training and making our service offering something that is not easily replicated by any other player. At the end of the day we think as the market returns to some sort of normalcy and even growth we are going to be in a phenomenal position to take advantage of that and we have an execution level that I think is second to none. So our focus is going to be on driving gross profit in general, not so much focused on that individual spread. George Pickral – Stephens: Switching over to aviation, you mentioned growing your exposure in Asia and Europe. I know you don’t give sector break downs in terms of percentage of your revenue, but can you have in the past talked about targeting business or maybe targeting other sectors.

Sure. I am sorry. I know it is tough sometimes and I am not known for speaking slowly but the focus of that comment on Europe and Asia had to do with the expansion on our supply side. As you know the history of our self-supply model and a lot of what we have developed and successfully transforming our strategy from going from sort of a small regional back to back reseller to a more robust global enterprise that is focused on supply had to do with our ability to generate self-supply opportunities in key locations in the domestic United States. That led to our inventory positions and it changed kind of the scope of our ability to play in the supply chain and it allowed us to add a whole new level of value to our supply partners as well as to our customers. We think that was a very successful model. What we are beginning to see some early signs of and we are excited about is there seems to be some similar opportunities to develop these models in the European theater, perhaps in the CIS and also we see even some indications in Asia. Historically these have been markets that have been very closed and very controlled at the airport level but there is some indication this is changing. The regulatory environment is changing in Europe. There is pressure within the EU and sort of deregulation to open up some markets. We think this is good news and it suits our model uniquely. The fact we are in a position to manage the short position, the ability to actually be able to finance self-supply, these are all very good things for us. So the comment is around the fact not only has our customer expansion robust but we think the success of our model in the United States and being able to self-supply and open up these airports has some early signs of potential to develop in the European theater and Asia. So that is good news and we are excited about that. George Pickral – Stephens: Not to get too far ahead of ourselves here but is there a land opportunity in developing nations? I know the focus right now is mostly on the U.S. and you have some exposure in Britain but is this something you could take to Asia, Africa or Eastern Europe?

What we have been seeing over the last 3-4 years with the retreat from the downstream market and the fragmentation that has been going on in the U.S. is happening really worldwide. It has been going on in Europe for a number of years. We are seeing it all throughout Africa; BP, Total, Shell. We are seeing it in New Zealand and Australia. So yes that is occurring. Right now we are staying focused on our core areas of the U.K., Brazil and the United States obviously the Lakeside acquisition we think the good old USA provides us with great opportunity to safely expand and consolidate our position here. But we certainly are looking at those opportunities. We are conservative. We are building it brick by brick. But we do see it as a global business. You have heard the stats in terms of the land growth it has been a slow burn but we do see it as a global business.

The next question comes from the line of Jonathan Chappell – JP Morgan. Jonathan Chappell – JP Morgan: You both mentioned investments in people and technology and from what I understand the investments in technology are probably pretty much behind you with the ERP system but the salaries and wages is actually down as a percentage of gross profit. How much more volume and how many more acquisitions can you do to add scale and complement your current businesses without having to add significant headcount?

That is a great question. Probably not the easiest question to answer in a finite fashion. You recognize that comp as a percentage of GP is down. We have done a good job there. That number will bounce around from quarter to quarter. We are clearly at the point where we don’t need to hire at the rate we were hiring in 2007 for example but there are still opportunities to add key personnel to all three of our business, even in some of our corporate back office functions. But we do have more leverage. As we buy more acquisitions we should be able to improve that metric over the long-term.

I would also say to add on to your question about technology investment, yes the ERP platform that we put in was of as you know a major undertaking and we are very happy to have the bulk of that behind us but as we get past all of the fundamental ERP thing as we continue to refine our model what we are finding is there are some pretty exciting opportunities to use technology on the customer interfacing side which are really commercially driven ways to entangle customer supply as opposed to just managing all of the compliance and the internal control and the management of information globally which was pretty critical to the backbone of our model. When we look down the road and we look out a couple of years we think strategically some of the differentiation is going to be around the ability to be easy to do business with. Technology is a great way to do that. I think that as we were in this sort of difficult economic trough it was a good time for us to step back and take the time to make some of those investments and begin to lay out maps strategically how those offerings could actually put a much greater gap between us and the competitive landscape. Technology is never something that just stops. It is an ongoing investment and it is something we think is an integral part of our offering. We are excited about it. No, are we going back to the levels of investment that we saw with the ERP we don’t really see that. To say we just stopped everything and there is no more technology investment that would not be true either. Jonathan Chappell – JP Morgan: On the Lakeside acquisition the way I interpret it it seems pretty similar to the TGS Petroleum acquisition from last year, the distribution business, branded business which is I think higher margin than some of the other potential land businesses. First of all, is that correct? Second of all, what is the competition like in that region? It seems to be an extension of your Midwest presence. Are there further opportunities to kind of continue to build out and let’s call Chicago as a hub for a Midwest part of the land business?

I think the Lakeside business is similar from the viewpoint that we are looking at a distribution model that is based on contracts. We like that. We are leveraging what we started out in Texor back in June of 2008. So it really is a plug and play from the perspective we understand the business extremely well and we have been building the platforms. So our intention is to continue to grow that space and add onto that. So it is back to your previous question in terms of standardizing and optimizing a lot of what we are doing. So it is a little bit different from TGS to the extent we really didn’t bring over, we brought four people over with TGS. This is a little bit different than that acquisition in the sense that we have got a management team that is sticking with the operations in Milwaukee. TGS was right in Chicago so all we had to do was take that business and basically move over the contracts and we picked up a couple of sales people and a couple of back office people. Lakeside is slightly different because it is Milwaukee. It is about 90 miles away. We do have an actual management team there. It will extend our range into a little broader geography. We have a couple of different things we are doing there which we are delighted with and just so it sort of expands and grows our whole land business. It is very much dropped into that business segment. Jonathan Chappell – JP Morgan: Are there [audio overlap] out there?

Many.

Just to add to what Mike said on some of your other questions, one of your questions related to the margins. I think in the branded space it is fair to say that the margin profile can vary significantly from state to state. It is not necessarily the case that margins would be higher than our average profile but whatever they may be the model obviously has a cost profile that matches up with the margin profile and still results in a pretty good result for us at the end of the day. Whether it be the Illinois area where we have already bought TGS or now Lakeside which is actually in Wisconsin and Minnesota, yes there are opportunities to further grow in that region alone on top of the other regions in the country where there may be similar opportunities that we haven’t found yet.

The next question comes from the line of Steve Ferazani – Sidoti & Company. Steve Ferazani – Sidoti & Company: Second straight quarter we have seen the tax rate below 20%. I know Ira you have commented on this a little bit. Are we seeing a long-term global shift or global mix shift that could sustain it below the 20% level? What are you seeing now?

It is tough to ever talk long-term in this business. I would say that in the short term we have been consistently below 20% if you look at the results. Actually the result of 2009 was in the low 20’s. The first quarter of 2009 matched up pretty closely with the first quarter of 2010. The last two quarters were both below 19%. I would say it is fair to assume that can continue in the short-term but as the business evolves Lakeside, as an example, while it is not going to contribute a very large percentage to our overall profitability that is going to be taxed at the highest domestic rates. That would have a negative impact on the tax rate beginning in the third quarter. So depending upon where the growth opportunities are that number could still vary as it has even though I have tried my best to give some reasonable guidance that is the one area where we have often missed a bit just because of the tremendous difference between rates from our lowest tax income in the world to the highest tax income. That mix could change from quarter to quarter but what we see now in the shorter term, and that is why I was willing to offer up an estimate for the full-year we see the number somewhere either in a very high teens or very low 20’s. If that changes we will let you know next quarter. Steve Ferazani – Sidoti & Company: How much of this is related to the government aviation contract? Is that pushing down?

That is one of many pieces. That is one that has a positive benefit on the tax rate. There are other pieces that do as well. Steve Ferazani – Sidoti & Company: Can you comment at all about how that contract is going and whether it is leading you to pursue other DoD type contracts and where that could go in terms of being a volume driver?

As you may know we first got into the government contracting business back in the late 1980’s when we were still a private company before we were even sold as a marine entity to World Fuel. So it has been some resident expertise for a long time. It has been part of our ongoing business. It comes and goes just dependent upon what the tendering cycles are. It is something we believe is a good business to be in because there is a very high level of logistical expertise associated with that business and that is very strategically valuable to us because it drives certain economies of scale and it drives certain kinds of discipline throughout our commercial activity on the back of that. So we continue to just monitor the tendering process. We participate from time to time depending upon where our capabilities might be. It has been part of our business. It is not new in that sense. It has always been kind of a part of our thing. We think the team does a very good job. One of the things that may be of interest over time, we don’t know, as the land business expands we may find some opportunities there because historically the military activity has primarily been concentrated in marine and aviation. But there may be some opportunities on the land side and we are exploring that. Steve Ferazani – Sidoti & Company: On the bad debt expense if you are pursuing the higher quality customers does that mean you have higher quality receivables and we can expect that number could remain at a lower level? I know you don’t guide for that line.

Clearly the quality of the receivables is a key factor in the overall reserve methodology we utilize. But in saying that there is a very broad mix. We had $1 billion of receivables at the end of this quarter and that includes customers of many different shapes and sizes and there are a lot of factors that go into calculating that reserve. It is tough to give any more formal guidance than that going forward.

There are no further questions at this time.

Thank you very much for joining us this afternoon. We will look forward to speaking to you at the end of Q2. Take care.