Good day everyone and welcome to Entegris’ first quarter 2009 earnings release conference call. Today’s call is being recorded. At this time for opening remarks and introductions, I’d like to turn the call over to Mr. Steve Cantor, Vice President of Corporate Relations. Please go ahead sir.

Thank you, Tom. Good morning and thank you for joining our call today. Earlier, we announced our results for our first quarter ended March 28, 2009. You can access a copy of our press release on our website www.entegris.com. Before we begin today, I would like to remind listeners that our comments will include some forward-looking statements. These statements involve a number of risks and uncertainties, which are outlined in detail in our reports and filings with the SEC. On the call today are Gideon Argov, President and CEO, Bertrand Loy, Chief Operating Officer. Greg Graves, Chief Financial Officer, John Goodman CTIO and the Head of our Specialty Materials division. Gideon will now begin the call.

Thank you, Steve. Good morning. Our results for the March quarter reflected the impact of the global economic crisis and one of the steepest and sharpest downturns in the history of the semiconductor and electronic industries. First quarter sales declined 48% from the December quarter to $59 million, which led to $39 million operating loss for the quarter before restructuring charges. As a result of the steps we took to reduce our cost, our EBITDA loss for the quarter, excluding restructuring charges was $16 million, well within the cumulative EBITDA loss of $31 million stipulated by our bank covenants. Much of our focus over the past two quarters has been on resetting our cost structure. While there were some signs of improved trends for unit-driven products beginning in March, we took additional cost reduction steps in the beginning of April, to further reduce our quarterly breakeven point to less than $85 million per quarter. These steps include both long-term actions such as headcount reductions as well as temporary cost savings including work furloughs. To put this in context, we’ve reduced our quarterly fixed operating expense by $28 million per quarter, compared to the beginning of 2008 n an apples-to-apples basis including Poco Graphite. This has entailed a reduction of about 800 positions, including direct labor, or roughly one-third of the number of employees we had a year ago on a pro forma basis. Vast majority of these reductions are structural, meaning that we’ve streamlined the organization and resized the business to revenues that are significantly lower than historical mid-cycle levels. We believe the cost structure we haven’t place will enable us to operate our business well within the covenants of our credit agreements, even if the depressed levels of business we experienced in the first quarter accessed persist for the…

Thank you, Gideon. I want to provide some commentary on our current breakeven level and our balance sheet before discussing the details of the first quarter. In April, we have taken steps to lower our quarterly EBITDA breakeven level to less than $85 million in Q2. To achieve this, we have eliminated an additional $6 million fixed operating costs and imposed short-term cost reductions such as unpaid leave, selective work reductions, and four-day work weeks, which will save an additional $5 million on a quarterly basis. Since February of last year, we have eliminated approximately $28 million per quarter of costs above and beyond reductions in direct labor. Cost savings include permanent reductions of $13 million, comprised of $8 million of operating expenses and $5 million of fixed manufacturing expenses. In addition, we have imposed $15 million of temporary cost reductions. With this in perspective in the first quarter of last year, we reported operating expenses of $54 million. In Q1 of this year that number was $38.6 million and we expect that to be approximately $32 million in Q2. This is a 40% reduction from Q1 of 2008. Looking at this in another way, our EBITDA breakeven level in Q2 of less than $85 million is based on quarterly manufacturing fixed cost of about $29 million, variable manufacturing cost of about 39% of revenue and operating expenses exclusive of amortization of approximately $32 million. We expect the breakeven level to be at this similar level in the second half is further reductions in cost related to the completion of our manufacturing moves are offset by the reversal of temporary cost reductions. Shifting to our first-quarter results, the loss for the quarter included a purchase accounting expense of $4 million to adjust acquired Poco inventory to market value. And a…

(Operator Instructions) We’ll take our first question from Steve Schwartz with First Analysis. One moment. Actually, we'll take our first question from Brett Hodess with Bank of America.

Good morning. Guys I was wondering, obviously that the visibility remains low, but I was wondering if you could talk a little bit, since you think the first quarter might be the bottom and you gave us some idea that the wafer shippers, where were picking up, how you think some of the other product areas will pick as utilization, lot of the reports on foundry and even a little memory utilizations rising, do you think the customers will go back to normal usage cycles on your the different filter products and so you’ll see some of your consumables business picking up by I know it’s probably too soon for CapEx related but maybe you can give us some color on that?

Let me try and then I’ll ask Bertrand as well, to chime in. The areas where we are seeing some and I reiterate some improvements are all related to consumable products and unit-driven products. And you’re right that $300 million new shippers towards the end of the first quarter, we did see a pick-up, part of that relates to market share, part of that relates to wafer growers and 300-millimeter production, the wafer grower business was essential shutdown for most of the first quarter, or much of the first quarter. We are not seeing a recovery at this time in capital oriented products although I would also tell you that we have a lot of products in that area that are actually new products that will be on platforms that eventually will see recovery and that we are going through various phases of qualification with customers. So we don't have lot of visibility Brett, as you know and at the same time we do see some signs of life in the unit-driven products, including I would say filtration, where we are seeing expediting going on, much of that related to Asia and the foundries. Bertrand?

I think you've covered it Gideon. The CapEx-related business was virtually non-existent in Q1. We don’t really expect any meaningful recovery any time soon. And I think you’ve covered the trend in the unit-driven business we saw some improvement in the second half of March and that trend has continued and accelerated as we get into April and the second quarter.

Okay, Just as an add-on to that, can you talk a little bit about the non-semi businesses, at 37% of the business that’s pretty reasonable amount. But we've heard, flat-panel display demand has been a little better than expected and some of the other areas life science, things like that can you give us any feel for how those are trending?

Yeah those businesses have not been as negatively impacted in Q1 we do expect those trends to also strengthen as we get into Q2 and later on in the year.

Yeah Brett. This is John Goodman In our Materials business, our semiconductor side is down, in comparison to the core, about the same. The Glass business that we are participant into the manufacturing glass bottles has remained relatively stable and we’ve seen only a slight decline there. Our EDM business, which is related injection molding has been flat to slightly down. We saw a couple of pulling orders from distributors that helped. But on balance it’s held up fairly well. Medical is one area that while it’s still small, is a focus for us that’s held up quite well and then our aerospace and aviation business is down a little bit but not nearly the same as the core. So overall the trends have been flat to slightly down but nothing like we’ve seen in the semiconductor market.

In my follow-on question to that is, if you look at the rising mix of non-semi, we’ve talked a little bit about this before but is there much difference in margins between semi and non-semi so that if we have a stronger mix in non-semi in the near-term, does that have any positive or negative impact on the overall margin mix?

Brett really the margin profile across the different sectors is pretty comparable, because in general we are selling similar types of products into the different markets.

Okay and then final question. You talked about the EBITDA and just wanted to be really clear. So you could have a cumulative of $31 million. You had $16 million in the first quarter but that’s a decent portion of that was because of different charges. So, Gideon, in your opening comments that even if you continued at this level, you wouldn't be in, you wouldn’t be in non-compliance with your covenants through the year, that's because even if you say at this level you have a much lower loss going forward?

Yeah I would, Brett this is Greg, I’d make two comments with regard to the so as we, first of all as we move into the second quarter, that 31 widens out to 45, so if you’ll think about it from what we have to work within the second quarter, it’s almost $30 million that other thing that I would comment on is well our revenue in the quarter was relatively linear, our profitability, our losses in the quarter were frontloaded in January and February as we worked very hard to take costs out of the business as we through the quarter so our performance in the back end of the quarter was much stronger than the front end of the quarter, And like you said, at that kinds of run rate we had, we feel very comfortable that even on flat revenue we will covenants comfortably.

Okay.

And finally Brett, it’s Gideon here, just to summarize on the cost side. The work we’ve done on the cost side as I think started out last year, well before the sort of the economic meltdown. We accelerated it in the wake-up of that meltdown and I think what you’re seeing is very, very significant and permanent cost cuts, which put us in a position today where we are in reasonable shape, in very good shape actually from a covenant standpoint whether the business continues to be severally impacted over the balance of the year or whether we do see a rebound in both cases we think we are in good shape.

Okay excellent, thank you for allowing me to have the questions.

And we’ll go back to Steve Schwartz with First Analysis.

Hi good morning gentlemen.

Good morning, Steve.

I guess my first question is on the break-even point, you had expected to maybe get to this level in a third or fourth quarter of this year with Chaska going over to Malaysia. So at this point, have you just moved that up or will you continue to lower this break-even point as you move through the year?

Steve, I would expect the break-even point to be relatively consistent through the year. What's going to happen is as the migration of manufacturing continues, we’ll continue to take fixed costs out on that side of the business, but at the same time, some of the temporary initiatives for instance, we are doing furloughs in Q2. We wouldn’t expect to be doing those in Q3 and Q4. So the reinstatement of some of the short-term reductions will offset some of the additional savings that we’ll see on the fixed side in the back half of the year. So the break-even will be consistent.

Okay. And on that you guys gave some pretty good detail about the temporary and permanent actions you've taken. Can you just very simply break down in percentage terms, what percent is permanent versus percent temp?

Yeah, we said about $28 million in cost over the past 15 months or we’ve taken out of the business but $15 million of that is temporary and $13 million of it is permanent.

Okay, okay. And then with respect to your cash flow, it looks like you’ve been getting some cash out of accounts receivable but at the same time and going forward I would imagine that would taper off. I would like to hear how you think that might play out over the next couple quarters? And then along with that I think Gideon, the way you described customers using up their consumables almost cannibalizing off of shuttered equipment, what have you? I would imagine then you will prepare and put cash into inventories, to prepare for that pendulum swing back, as the recovery begins. Can you talk a little bit about what you see in cash flow in those two categories?

Yes Steve, I guess I would say in general is I feel very good about our cash position and the cash flow going forward. I would say, I expect that we will burn some cash in Q2, because I don’t think we’ll hit that break-even EBITDA level and at the same time I’m hopeful, actually that we will burn some cash, as you said putting inventories and receivables back under the balance sheet as the business expands. But I expect the cash burn to be moderate and a number clearly that is manageable within the terms of our covenants and, like you said, overall feel good about the cash position and the cash flow prospects.

Okay, very good. Thanks Greg.

Steve, this is Bertrand and I’ll take on the your question about inventory and I think what will happen very likely over the next couple of quarters is that, first of all, the organization will continue to stay very focused on optimizing inventory levels. This said, as you would expect as part of product transfers, we have been building some level of buffer inventory to cover for the needs of our customers during the transfers of the products from Chaska to Malaysia. It’s about $2 to $3 million and I would expect that particular inventory to be reduced and, at the same time, we will allow obviously some increase in inventory levels for our consumable business. But net, net, I would expect the finished goods levels to be relatively flat and I would expect some further reduction in [WIP] and raw material inventory levels so I don’t expect in the short-term any significant pressure on working capital from the inventory.

And a final point on that related is that the way we have transitioned our infrastructure over the past year is designed to give us maximum flexibility from a manufacturing standpoint and the ability to respond rapidly to an influx of orders, or to the opposite, which is downturn. So that we have a lot of capacity obviously in our operations going forward and don’t see an issue responding to increased demand on a product line by product line basis, partially through inventory but frankly a lot of that is simply through flexible manufacturing.

Okay well that’s very helpful, thank you.

And we’ll take our next question from Christian Schwab with the Craig-Hallum Capital Group.

Great thank you for taking my question. When we look at the revenue recovery, what should we be thinking here, if we fall similar recovery scenarios, it seems like you're beginning to see that right? We see some rush orders out of the blue, then the filter side picks up a leg behind that and the wafer shippers pick up and then lastly the capital side picks up so you could sell fluid-handling products to the tool makers before they sell it to their end customers. So if we follow that typical recovery scenario, where are we in that? Are we just at the very first step any help?

Well Christian. I would reiterate, there has been nothing typical about this cycle. And there is no reason to suspect that the recovery will be typical, because this is not been a typical cycle. It’s been a cycle where capital and unit-driven have simultaneously gone done dramatically in a way that's never been seen before. There is a question about how much of the pick-up that we may see in the next quarter or two is related to a sort of onetime inventory replenishment, we don’t know the answer to that, and so I would hesitate to answer your question. If it is a typical recovery, then what you've said is correct. We would expect over the next couple of quarters, to see a gradual increase and may be not so gradual increase in capital orders as well, we saw that in the last cycle in 2001, 2002, we have not and I caution, seen that take place yet on the capital side here. So that’s a question mark, we are prepared either way from a cost stand point and for us I think that the most that the positive thing about us I can say is that we are in a variety of products both on the unit-driven side and the capital-driven side. We have taken this time to qualify new products, our new platforms that are relevant for 32 and 22-nanometer platforms of the customer and technology of the customer something that we know is coming down the line. We know that Intel and now TSMC has committed to 22 nanometers. We have a slew of products on the filtration side, the purification side, and, frankly, on the microenvironment side that are actually designed to work at 32 and 22 nanometers in environments that's going to require far more stringent contamination control. We think the materials side of our business the material science-oriented side of our business placed into that extremely well and including the new acquisitions that were made. So we are well prepared but we can’t tell you when that’s going to occur.

Right, I understand that. Can you speak to some of the leading customers that you have who is asking for rush orders? Who has lagged behind that could increase, should the world get better here and demand for chips continue to moderately improve or at least stop deteriorating at a rapid pace? I mean, is TSM back? Is Intel back? Can you give us any color there?

Christian this is Bertrand. Unfortunately, I won't be able to - for obvious reasons, to share with you the details of some of those orders we are getting but I would simply say that what activity that we are seeing is mostly driven by the usual suspects.

Great, thank you.

And we will take our next question from Timothy Arcuri with Citi.

Hi, this is Junaid Ahmed calling in for Tim. My first question is could you just outline the charges for each for the R&D and SG&A? How they hit those lines?

The restructuring charges were about $4.6 million in the quarter that breaks down roughly 50% related to severance and approximately 50% related to the migration of our manufacturing from Minnesota to Malaysia.

Okay. So could you outline how in what proportion it affects on the OpEx individually?

Well, we broke those charges are broken out as a separate line item on the P&L of 4.6, so they are included in the SG&A or the R&D.

Secondly, what kind of tax guidance - how should we be monitoring the tax going forward?

I would think about the tax rate in general as zero for the year depending on our profitability in Japan, you could see some modest benefits, or some modest tax charges. For instance in Q1, we had tax benefit at $2.6 million that all related to our Japanese entity but, is it relates to the United States we are not a taxpayer. We are in a valuation allowance position with regard to our deferred taxes, so we don’t recognize tax benefit either and so its really hard to say exact to give you our rate per se, but I would say, in general, it's going a million or $2 to $3 million positive or negative in any given quarter.

Okay.

And in general is they are going to be non-cash taxes.

Okay. And in terms of you breakeven given that right now as you as just mentioned on the call, there is a lot of the wafer starts increases being driven by inventory restocking rather than end demand increase. If things taper off or even track back a little bit once that restocking is done, and end demand doesn't pick up, how do you feel breakeven would you or how much lower would you be able to take that, or would you take your planning, if things kind of taper back?

What I would say is we have taken very significant actions to get that breakeven down to inside of $85 million. So our intension right now would not be to make any additional cost reduction measures. I would say, if things got extremely dire, are there additional actions that we could take on a short-term basis yes, but today we are not contemplating those.

And my last question, in terms of the expected technology shrinks by most of the memory guys, which is expected in, how do you line up in terms of getting exposure to that, if that takes place?

Yes, this is Bertrand, I would say that despite some of the cost reductions initiated late last year and earlier in this year, we have been very, very careful in not impacting our R&D capabilities and if anything we have continued to very aggressively work with our customers to allow them to very successfully and aggressively continue to migrate down on their technology roadmap. As such, I’m very happy with the position, we find ourselves in. We have a very rich pipeline of new products both in the CCS arena and in the ME division. We have the right fitters to allow our customers to migrate to 32 and 22-nanometer. We have the right micro environment products to allow them to deal with more difficult contamination challenges around the around the wafer, as it is transported from one process step to another, and we feel very around the competitive position we find ourselves in.

If the leading memory guys like, move to the 3X in NAND and maybe the 5X NOR in DRAM, you would expect to have to see some benefit there?

Absolutely.

Okay, all right, thank you.

And ladies and gentlemen that does conclude our question and answer session. At this time I would like to turn call back over to Mr. Argov for any closing remarks.

Thank you very which for anticipating on our call. We look forward to speaking with you as the year progresses.

And this does conclude today’s conference call. We appreciate your participation. You may disconnect at this time.