Good day, ladies and gentlemen and welcome to the first quarter 2012 Cabot earnings conference call. My name is Jeremy and I’ll be your operator for today. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. (Operator Instructions) I would now like to turn the conference over to your host for today Ms. Susannah Robinson with Investor Relations. Please proceed, ma’am.

Thanks, Jeremy. Good Afternoon. I would like to welcome you to the Cabot Corporation earnings teleconference. Here this afternoon are, Patrick Prevost, Cabot’s President and CEO; Eddie Cordeiro, Cabot’s Chief Financial Officer; Sean Keohane, General Manager of the Performance Segment; Fred von Gottberg, General Manager of the New Business Segment; Jim Kelly, Corporate Controller; and Brian Berube, General Counsel. Last night, we released results for our first quarter of fiscal year 2012, copies of which are posted in the Investor Relations section of our website. For those on our mailing list, you received a press release either by e-mail or fax. If you are not on our mailing list and are interested in receiving this information in the future, please contact Investor Relations. The slide deck that accompanies this call is also available in the Investor Relations portion of our website, and will be available in conjunction with the replay of the call. I remind you that our conversation today will include forward-looking statements, which are subject to risks and uncertainties, and Cabot’s actual results may differ materially from those expressed in the forward-looking statements. A list of factors that could affect Cabot’s actual results can be found in the press release we issued last night and are discussed more fully in the reports we file with the Securities and Exchange Commission, particularly our last Annual Report on Form 10-K. These filings can be found in the Investor Relations portion of our website. I will now turn the call over to Patrick Prevost, who will discuss the key highlights of the company’s performance for the quarter. Eddie Cordeiro will review the business segment and corporate financial details. And following this, Patrick will provide closing comments and open the floor to questions. Patrick?

Thank you, Susannah and good afternoon, ladies and gentlemen. For the first quarter of 2012, despite a difficult global economic environment, our results benefited from the successful execution of our long-term strategy. We increased our margins through focused actions to improve the pricing and product mix of our businesses and by continuing to improve the efficiencies of our operations. These efforts translated into a 9% increase in segment earnings year over year. Our commercial strategy focuses on innovation and value. We’re working very closely with our customers to develop new products or improve on the existing ones, to enable increased performance of their products. Enabling differentiation and making our customer successful is our aim. Beyond that, we see ourselves as leaders in the businesses we run. Here, our aim is to create value everyday by driving continual improvement in quality, service and reliability. In the first quarter, we completed most of our contract negotiations for the next calendar year and are pleased with the results achieved. These agreements will yield higher margins and will start to impact results in our second fiscal quarter. In the first quarter, we experienced some volume softness in the Core and Performance segment due to economic uncertainty, some seasonality effects and customer inventory destocking. Although, we do not know precisely how much of the volume decline was related to destocking, we’re already seeing a rebound in orders in January particularly in the Performance segment. This gives us some assurance that volumes will strengthen in the coming month. From an economic point of view, the most challenging region of the world remains Europe, while we see improvements in the economy in North America. The most recent Purchasing Managers manufacturing index shows improvements in many countries around the world. And as a reminder, we have approximately 50%…

Thank you, Patrick. For the first fiscal quarter, total segment EBIT from continuing operations was $81 million which was $7 million higher than last year’s first quarter driven by higher pricing and improved operating efficiency that more than offset higher costs from new capacity and lower volumes in Rubber Blacks and Fumed Metal Oxides. Sequentially segment profit from continuing operations increased by $2 million. The key factors in the increase were higher margins from favorable feedstock purchasing and lower manufacturing costs. The manufacturing costs were lower by approximately $10 million from a combination of lower maintenance spending and the fixed cost benefit of higher inventory levels. Lower volumes across the Core and Performance segments partially offset these benefits. Additionally, our total segment EBIT was unfavorably affected by $7 million decline in the Specialty Fluids business from an exceptionally strong fourth quarter. Now, I will discuss the details at the second level beginning with Rubber Blacks. During the first quarter of 2012, the Rubber Blacks business experienced its second strongest quarter ever, increasing EBIT by $18 million from the first quarter of 2011. The increase was driven principally by higher margins resulting from higher prices and a favorable product mix. These positive factors more than offset the impact of 9% lower global volumes. Sequentially, EBIT increased $17 million from the fourth fiscal quarter of 2011. This resulted from lower raw material and manufacturing costs partially offset by 5% lower global volumes. Our reduced manufacturing costs were due to lower plant maintenance and increased inventory levels. In the Performance segment, EBIT decreased by $10 million as compared to the first quarter of 2011. Decrease was driven principally by higher fixed costs from the start up of new capacity and unfavorable product mix and increased segment management cost. Sequentially EBIT decreased by $6…

Thank you very much, Eddie. Given the current economic environment, we are very pleased with our financial results this quarter. We continue to make progress in improving the margin profile of our businesses through pricing, product mix management and increased efficiency. Although Europe will continue to be a challenge for us in the near term, we’re optimistic about the Americas and Asia driving growth in our Core and Performance segments. Overall, we are already seeing improving demand as our customers replenish inventories after the destocking that took place in the first quarter. We’re well positioned with our existing and new capacity to capture significant value for shareholders as growth returns. From a slightly longer-term perspective, our capital investments in capacity and efficiency remain on track. This year, we have new, very low cost fumed silica capacity coming online in China. We will also see carbon black debottlenecks starting up in Indonesia and South America. Our yield improvement projects are being implemented around the world and a new energy center will be commissioned in Europe. Finally, we’re excited about the innovative products and technologies we’re pursuing in areas such as commercial inkjet printing, insulative coatings, battery materials and graphenes. In inkjet, we’ll complete the expansion of our U.S. facility to support the growth of this business. All of these investments coming on stream will support the longer-term growth and efficiency of the company. Overall, I’m pleased with the ongoing strengthening of Cabot and the successful execution of our strategy, and remain confident in our ability to achieve our long-term objectives.

(Operator Instructions) And our first question comes from Saul Ludwig with Northcoast Research. Please proceed. Saul Ludwig – Northcoast Research: Good afternoon everybody and congratulations on a good quarter.

Thank you. Good afternoon, Saul. Saul Ludwig – Northcoast Research: How much this question which turns us start-up cost, there are unusual costs, how much were the start up costs in the Performance sector in the first quarter? And you talked about the shutting down of plant for five weeks in the second quarter and some other inkjet plants starting up. What kind of magnitude of expenses are you going to incur from these types of actions that are certainly embedded in your positive outlook for earnings for the company? But I’m just curious as to what the headwind is from these various startup and plant issues that occurred in the first quarter and will occur in the balance of the year?

Right, well, Saul. So I guess there is two types of cost that come with this. And again, I think to make money, you need to spend money. And we’re going to have one-time costs in terms of starting up new operations and I would put those in the single millions of dollars in each case, so not huge expenses. And then there’s the additional fixed cost coming from new operations being added to the portfolio and here we’ve been focusing on efficiency and mostly around debottlenecking existing operations. So, in general, I would say that the addition of capacity is happening at very low fixed cost rates and those that are starting up in the current period or the last period, the cost there are already embedded in the operations. Saul Ludwig – Northcoast Research: And what was the cost in the first quarter in the Performance sector?

I don’t think that we disclose that, Saul. Saul Ludwig – Northcoast Research: Okay. You mentioned the new contracts that you signed successfully and you’re pleased with the outcomes that that will begin to effect in the current period, are these – where you do have contracts there typically they maybe one year, two year or three year and it’s different by customer. But approximately what percentage of your contracts rolled over this year and might roll over next year and might roll over the following year, because I don’t think you get all of your contracts rolled over at the same time?

Right. So, this is a sensitive area in terms of disclosing what we do in the contract field. But we, in the past we’ve indicated that roughly 50% of our Rubber Blacks volume would be under contract. And I would say most of these contracts are of an annual tenure and that would still be a good way to think about it today. Saul Ludwig – Northcoast Research: So, most of them would have rolled over in January.

That would be the way to think about it, yeah. Saul Ludwig – Northcoast Research: Got you. And the final question, you mentioned you saw a pickup in January in your Performance areas from your customers. Did you see any movement in Rubber Blacks?

Well, we saw a positive movement in Rubber Blacks but it’s been most I would say visible in the Performance segment and we’re talking almost up to 10% on the Performance segment side. Saul Ludwig – Northcoast Research: Great. Thank you very much.

Thank you, Saul.

And our next question comes from Ivan Marcuse with KeyBanc Capital. Please proceed. Ivan Marcuse – KeyBanc Capital: Thanks guys for taking my question.

Good afternoon, Ivan. Ivan Marcuse – KeyBanc Capital: The first is on the mix side. You had a benefit from mix, so is this – Rubber Blacks are going to the higher in tires or could you give a little granularity around what this mix is and should this trend continue going forward?

Right. So, what has been going on with regard to our commercial strategy, it’s been actually about focusing on the high value added products that we, that we delivered to the market and that has been about product that impart capabilities to our customers end products that are unique where we are also able to differentiate compared to our competition. And this is an effort that will be ongoing. I mean the same happens on the Performance segment as well and clearly we are migrating towards the more differentiated part of our portfolio. And we’ve been very successful with that and we’ll continue to be. That does not diminish the fact that we’re continuing to be very focused on value pricing in the rest of the portfolio where we look at the quality, the reliability, the superior service we offer to our customers and work very hard to getting paid for that. Ivan Marcuse – KeyBanc Capital: Got you, thanks. And then with – in the inkjet, in the new business where capacity coming on, would you expect that segment to start being consistently profitable, starting in the back half of the year or do you? How should I think about this volume coming on capacity?

We – yeah, I would say Fred is here, but it’s really clearly the objective of that segment to deliver profitability not only in the long-term but also in the near-term. So there is a lot of work going on to make that happen and right now the inkjet business especially the commercial side of that business has being growing very rapidly and it’s, it’s a very good business for us, which has led actually to us deciding to invest in our Haverhill, facility in Massachusetts and we’re putting a new line in for $10 million which will be staring up during the course of this year. Ivan Marcuse – KeyBanc Capital: Got you. And then in the Rubber Blacks business, can customers continue to destock or manage your inventories aggressively or going to more seasonal or driving season, do you see, volumes pick up and how should you think about the trends going forward?

I would say that somewhat differently from the customers in the Performance segment. The Rubber Black customers tend to have a much tighter supply chain, meaning that there is very little inventory in that supply chain and you can also imagine that there is less steps in the supply chain between (inaudible) carbon black supplies and the final use of the consumer and because of that and the efficiency in that supply chain, we believe that we see fairly clearly what the underlying demand is. That is quite different on the Performance segment side where the supply chain is broader and deeper there are more steps in it and that creates somewhat more distortion in terms of the volumes especially as you look at it on the monthly or quarterly basis. Ivan Marcuse – KeyBanc Capital: Great. And then is there any update to the CEC business?

We’re on track working very hard at making this a success. Ivan Marcuse – KeyBanc Capital: Great. Thanks for taking my questions.

Thank you, Ivan.

And our next question comes from Jeff Zekauskas. Please proceed. Jeff Zekauskas – JPMorgan: Thanks very much. Patrick, when you were talking about the use of proceeds from the sale of the business, you talked about organic and inorganic opportunities, does inorganic mean acquisitions?

Hi Jeff, yes, it does and I certainly look at that as a way to continue to add value to the company and bring value back to the shareholders and it is one of our four strategic pillars and it’s – the portfolio management can happen in terms of sales of business and we’ve just demonstrated that we could do that to focus the portfolio and we will be looking and continue to look at opportunities to bring new businesses or extend our existing businesses through acquisitions. Jeff Zekauskas – JPMorgan: Okay. Then a question for Ed, in the note that you’re going to get from GAM, what’s the value of the note and will that be a current asset?

So, I guess Jeff, the note which we’ve already received from GAM because the transaction has been closed. Jeff Zekauskas – JPMorgan: Right.

Will be for the full value of the $215 million which is the second part of the purchase. Jeff Zekauskas – JPMorgan: Right.

But the way we’ve accounted for it essentially because it’s a note, it’s essentially a loan, we’ve had to impute some interest and the real issue here is that it will manifest itself in interest income that we will receive, but essentially we will get the full $215 million payment at one point in time when they decide to pay that up through this next 24 months. Jeff Zekauskas – JPMorgan: Is it a current liability?

It’s been a prudent non-current asset because they have three years.

So, it will be a non current asset. Jeff Zekauskas – JPMorgan: Noncurrent asset. Okay. Your China volumes in carbon black in the quarter were basically up 1% and sort of down 6% sequentially. And you know GDP in China grow around 9% and many of the chemical companies talk about inventory destocking and all of that. Though it’s always amazing to see sort of flat growth in the 9% growth economy. Do you have any reflections on that 1% number and do you expect the first quarter in China to be relatively slow or to rebound strongly or how do you see that?

Brian?

So we’re still – and we continue to be very pleased with our China business. I think a real success story for Cabot. With regard to the more recent environment, I think we’re seeing a couple of things going on here. I would say perhaps some destocking because of increased uncertainty with regard to the, even the China economic environment. There is or there was Chinese New Year that they were preparing for which occurred last week or the week before last. And then I think there is some effect that is difficult to quantify, but maybe related to a slowdown in export opportunities of tires to Europe and North America we know because of the duties, but indirectly a slowdown in demand in North America. So we’re tracking things but I would say at this stage the – my China team continues to be very positive and we believe that the growth will continue especially as we see the domestic market in China continuing to be very strong. Jeff Zekauskas – JPMorgan: Okay. And then lastly you talked about the shutdown of your Colombian capacity for five weeks, can you remind me what the size of this facility is on an annualized basis?

Yeah, it’s one of our smaller carbon black facilities. It’s I believe on an annual capacity around 60,000 to 70,000 on the year. So it’s not a very large facility but clearly when you’re in a situation where you have to shut down for a period of time, you need to prepare and build some inventory. It’s bit of an unusual situation because the refinery from which we get our raw material which is next door is actually going through a major revamp and is shutting down for that same period of time. Jeff Zekauskas – JPMorgan: Okay. Thank you. I’ll get back in the queue.

Thank you.

(Operator Instructions). Our next question comes from Christopher Butler Sidoti & Company. Please proceed. Christopher Butler – Sidoti and Company: Hi, good afternoon.

Good afternoon, Chris. Christopher Butler – Sidoti and Company: With the Rubber Black business, was there any CEC income in this quarter?

Well, if you remember, we actually moved the CEC business into the new business segment, again, the previous quarter? Christopher Butler – Sidoti and Company: I thought that was for our all non-tire business though?

No ,it’s for all of the business. Actually the management of the tire relationship remains with the Royal Bank’s business because of the importance of the relationship there. But in terms of the financials, it will all be in the new business segment from now on. Christopher Butler – Sidoti and Company: I apologize for the confusion. With the soft volumes in the quarter, if we’re looking at the mix of that soft volumes, was that just an average mix or is there anything particular in that, that may bounce back next quarter?

Chris, I’m not sure I got the question. Do you mind repeating it? Christopher Butler – Sidoti and Company: Sure, sure. With the volumes that you lost, was this good product mix that you were losing, bad product mix or average?

I would say that in general when there’s a slowdown like this, there’s a tendency for the large or more standard products to see a larger slowdown than the higher margin, higher value product. Christopher Butler – Sidoti and Company: And as we look forward here, could you talk on raw material costs with oil rebounding and expectations there?

Well, we’re managing the feedstock for carbon black very actively as a company. And as you may remember, we have various sources of feedstock, some are tied to the steel industry, some to the petrochemical industry, some directly to the oil industry. And what we’ve seen actually over the last quarter or two quarters is the, an ability to be able to capture some more interesting and more attractive type materials and this has started to be reflected in the performance of the business. With regard to the absolute price of oil and how it affects our business, I would say that we have driven our business management to be able to recover the fluctuations in the base oil price very rapidly to the extent where we become somewhat indifferent to the absolute price level. Christopher Butler – Sidoti and Company: I appreciate your time.

Thank you, Chris.

Our next question comes from John Roberts with Buckingham Research. Please proceed. John Roberts – Buckingham Research: Good afternoon.

Good afternoon, John. John Roberts – Buckingham Research: The press release talked about the Core segment benefit from an inventory increase, maybe that was the prior question just answered but when you’re building inventories of cheap feedstock or you’re referring to that?

No. Actually we’ve built inventory in the Rubber Blacks segment for two reasons. One was – and the majority of the inventory build was actually planned because the example of our Cartagena operation in Colombia is one but we also have a few other situations including the tying of some other facilities within our system which has required us to build some modest level of inventory. The other part of this inventory build was unplanned and somewhat focused on our European region where the demand in December was somewhat lighter than we had originally forecast. But what’s been interesting here is that although the European economic environment seems to be quite uncertain, we have also seen in Europe some recovery in the month of January which would indicate that de-stocking had also been going on towards the end of the calendar year. John Roberts – Buckingham Research: So what you were referring to is you benefited to the extent your operating rights would have been even lower if you hadn’t built the inventory?

That’s correct. John Roberts – Buckingham Research: Okay. Thank you.

And our next question comes from David Begleiter with Deutsche Bank. Please proceed. David Begleiter – Deutsche Bank: Thank you. Good morning – afternoon, sorry.

Hi, Dave. David Begleiter – Deutsche Bank: Patrick, you mentioned earlier that about half of your Rubber Black volumes are under contract. Would you prefer to have more or less of your Rubber Blacks volume under contract?

I would say that this is a question that is quite strategic and is very dependent on the type of customers, the type of products and the type of geography you are dealing with. I would say that the 50% level at which we operate at is a level that we’re comfortable with, it’s a level that we drive towards, but of course in a relationship like that there is two parties and it’s also one that is reflective of the strong ties with, that are maybe stronger with certain of our customers than with others. But I would say that it’s a good level for us. David Begleiter – Deutsche Bank: Fair enough. Also margins in Rubber Blacks were the highest in a while, 11%, some was unusual I gather by the inventory build. How much of that was a bit unusual, how much is sustainable or realizable at this new higher level?

Well, the inventory build is a minute part of this, so I would say it is fundamentally a very solid base for the business. David Begleiter – Deutsche Bank: Also obviously mix is driving a lot of this. Can you remind us of the range of margins amongst these Rubber Black products from low to high mix?

Right. We – it’s an area that we’re uncomfortable sharing because of the competitive nature of that information. So, sorry about that, Dave. David Begleiter – Deutsche Bank: Understood. And lastly, the volumes in South America, they were down a lot year over year and sequentially, was that due to the Colombian situation or was that something else driving out those numbers?

I would say, well, the Colombian situation is not, no was not affecting that. What we have been seeing in South America is because of the strength of the real. Some of the, some of our customers have seen more competition from imported tires into the region. I mean, fundamentally the demand is fairly good, still growing, but more imports are putting pressure on the tire producers, but I think this is slightly abating with where the real has been more recently. David Begleiter – Deutsche Bank: Thank you very much.

Thank you.

And we have a follow up question from Saul Ludwig. Please proceed. Saul Ludwig – Northcoast Research: Patrick, the 15% drop in volume in Southeast Asia, when you were having last year similar declines, that represented the closure of the plant in India. In the first quarter, the 15% decline would be more apples-and-apples with capacity that you had post closing the plant in India. Why do you think it was so weak and what do you think happens going forward?

Yeah, so that’s good analysis, Saul. As we look at what’s going in Southeast Asia and Indonesia most specifically, although we also have an operation in Malaysia, these markets are very dependent on export volume. I believe that the Indonesian tire market exports something like 60% of its production and what we’re seeing currently is the weakening of the European and North American replacement tire demand and this backing up into the Indonesian local production. We look at Indonesia as a huge market which will continue to grow, there is more than 250 million people there and as the wealth increases and the economy does well, there is going to be more and more demand locally. So that this is kind of the way we think about that market and why we’re continuing to be bullish about that market and continuing to look at capacity expansion there. Saul Ludwig – Northcoast Research: Got you. And then finally, you commented earlier about your pleasure or your satisfaction with the renegotiation of your Rubber Blacks contracts in that, so on the 50%. In the areas where you don’t have contracts more or like in Asia, China, South America and the pricing is more month to month, are those prices moving kind of commensurate with the type of changes, whatever the changes you did yet in the contract business. Maybe the question is how is pricing moving in the non-contract world versus the contract world?

Well I would say this, with regard to us, there is not much difference, so we’re driving pricing strategy and philosophy that is very similar and I would say that we’re generally satisfied with where things are going from that point of view. Saul Ludwig – Northcoast Research: Okay. And then the final question for Eddie, you’re going to get $3 million to $5 million a quarter in interest income, let’s call it $4 million, that will be $12 million of interest income which you book, yeah that’s like about $0.15 a share of additional earnings in the back of three quarters of the year, is that thinking about at the right way?

That’s correct. Saul Ludwig – Northcoast Research: Okay. Thank you very much.

Thank you, Saul.

And we have another follow-up question from Jeff Zekauskas. Please proceed. Jeff Zekauskas – JPMorgan: Thanks. In fiscal 2011, what was the earnings per share currency benefit and what do you see as the currency decrement in 2012?

So, Jeff just a second. We need...

Jeff, I just don’t – I don’t have the number off the top of my head here for 2011. Jeff Zekauskas – JPMorgan: Then what’s the 2012 decrement?

We don’t really forecast the currency because I don’t really know what it’s going to look like. Jeff Zekauskas – JPMorgan: Okay. And...?

But perhaps you could follow up on 2011...?

Yeah, and we could certainly get you’ the information for 2011. I guess my recollection as it was not significant because what happened was that there was a strengthening and then a weakening and so look like it was going to be a big deal for us but then by the time the fiscal year played out, it really wasn’t a huge impact in fiscal 2011. And again, we don’t typically forecast what the currencies look like for exactly that reason. Jeff Zekauskas – JPMorgan: Okay. And you talked about benefiting from a lower level of maintenance spending in the first quarter, where do you normally spend annually for maintenance and do you expect that maintenance spending to be any different in the second quarter?

I guess, we wouldn’t get into the specifics on how much we spend in absolute, but for the second quarter and as we sort of think about the rest of the year, Jeff, we tend to have most of maintenance or a heavier chunk of maintenance take place in the summer months which is when we tend to have plants go down and do turnarounds and that’s really why we saw a big chunk in the September quarter and why we did not see that recurring again in the December quarter. And so, I think we had said that in October that we would not anticipate seeing that maintenance spending recur. And that was the principal driver of the $10 million reduction or so of fixed cost that we saw in Q1, and then going into the rest of this year we wouldn’t expect to see tremendously different maintenance spending until we get to the summer months. Jeff Zekauskas – JPMorgan: Okay. And then, I guess I didn’t fully understand the year-over-year profit decrement in Performance segment in that, it’s true that your volumes were negative but probably your were prices were up nicely and the earnings decrement was basically a third. So were there significant extra costs from the startup of the manufacturing asset or can you analyze that 10 million decrease?

Yeah. I think Jeff, basically year over year, so a year ago we did not have the startup cost of a couple of key facilities. We had a masterbatch facility that started up during the year and we’ve also started to incur costs for a fume silica facility in China for which we have a pretty significant debottleneck that’s come online. Those were the two main drivers of the additional cost, but on top of that, we also had an unfavorable product mix. And so, if you look at the volumes, you will see that the fume silica volumes were down year over year and that tends to be quite a high margin product. And so, when you have that unfavorable mix that’s the other key driver of that $10 million. Jeff Zekauskas – JPMorgan: Okay. Thanks. And then for the interest on the note, these are pretty high interest rates. So I guess, how do you think about that? You’re not putting it into discontinued operations?

No, I am going to ask Jim to answer because we actually have to go through a pretty extensive examination and we actually went outside to make sure we were doing this appropriately.

We worked with Deloitte on this one Jeff and essentially we have to associate all of the notes that relate to the contingent. Earn out from the business going forward, the remaining 175 that will ultimately be a 215 payment et cetera and had to associate all of those together and present value those for the calculation of the game. And the rate at which we present value was basically a market interest rate that was reflective of the credit risk of the buyer of the business. Jeff Zekauskas – JPMorgan: I see. Okay. Thank you very much.

Welcome.

And our next question comes from Ivan Marcuse with KeyBanc Capital. Please proceed. Ivan Marcuse – KeyBanc Capital: Thanks for taking my question. It’s been a couple of quarters now were you doing share buybacks, is this going to be continuing trend and then also how do you look at ever increasing your dividend, is that ever in consideration versus doing a buyback or maybe even both?

So, Ivan, we have a continued history of returning cash to shareholders and that happens through dividend, payments and share buybacks. On the dividend side, I believe it’s been many years, I can’t remember actually when we had any drops and if we did in the dividend payments. And what we do on very regularly is to check how our yield and our payout ratio compares to other companies in our sector and we do this evaluation on a regular basis. We’ve done one just recently and we believe that we’re very competitive and from both perspectives. On the share buyback side, we, our philosophy has been except exceptional circumstances to offset the dilution on a regular basis and we haven’t done because of the 2008, 20’09 economic environment, we haven’t done any of that for a couple of years. And as we looked at our cash situation and the share price more recently, we decided to do some share buybacks and the total shares we bought back were was, I’m trying to remember Eddie...

2.5...

2.5 million shares which is more than, is actually a reflective of several years of dilution and we’ve done that at a price that was close or slightly below $32 per share and we’ll be continuing to look at doing that going forward. Ivan Marcuse – KeyBanc Capital: How much more available do you have on your...?

So we have our authorization allows us to buy back 1.8 million shares at this stage. So we still have that capacity today. Ivan Marcuse – KeyBanc Capital: Great, thanks.

Thank you.

And our next question comes from Laurence Alexander with Jefferies. Please proceed. Lucy Watson – Jefferies: Good afternoon, this is Lucy Watson on for Laurence today. Just to go back to the topic of potential inorganic growth opportunities, what do you view as a good business to add to your current portfolio and what are the criteria that you would use to evaluate on M&A prospects?

Brian.

So we in terms of opportunities from an acquisition perspective, we look at it in three buckets. The first one would be acquisitions that would be in the businesses in which we’re in. So those are fairly simple to do from a strategic point of view. The second bucket is a technology bucket which would be leveraging on material capability, our technology in adjacent material capability. So for example the graphenes business would be a case in point or the recent two years ago we did an acquisition in the security materials areas. So those would be reflective of that second bucket, more technology driven in our space. And then the third one would be looking at adjacencies to our portfolio. They would need to be in a similar space as the space we operate in so chemical, specialty chemicals, performance materials and we need to have some link with regard to either technology or types of markets to pass the test. I mean, we, of course, have other test which relate to valuation and also the fact that we would most likely only be interested especially in this adjacency area, in businesses that would have leadership positions. Lucy Watson – Jefferies: Okay. And as you evaluate your growth prospects going forward and inorganic versus organic opportunities, do you have an equally active pipeline of both or I guess as you think about reaching your earnings target, do you view one or the other as – are you equally balanced in getting that growth from both organic and inorganic opportunities?

So as we’ve mentioned before, we look at the – our long term target, our 2014 target to be effected with the portfolio we have. We think that one or the other small acquisition would be helpful in achieving the target but we’re very comfortable in terms of being able to achieve that target with the current growth plans and the organic investments that we’re currently doing. Lucy Watson – Jefferies: Okay. Thank you.

Thank you.

And at this time there are no questions. I’d like to hand it back to Mr. Patrick Prevost, President and CEO.

So thank you very much for joining us this afternoon. As you see, the execution of our strategy continues to result in strong financial performance and I am pleased with that performance and it makes me very confident about the future of Cabot and we’ll look forward to delivering the value to our shareholders and again, thank you very much for joining us and looking forward to speaking to you next quarter.

Ladies and gentlemen, that concludes today’s conference. Thank you for your participation. You may now disconnect. Have a great day.