Welcome everyone to the Graphic Packaging Holding’s first quarter 2008 conference call. (Operator Instructions) I would now like to introduce Scott Wenhold, Vice President and Treasurer.

Welcome to Graphic Packaging Holding Company’s first quarter earnings call. Commenting on the results this morning are the David Scheible, the Company’s President and CEO and Dan Blount, Senior Vice President and CFO. Before we get started I would like to remind everyone that statements of our expectations including but not limited to the achievement of synergies and debt reduction, pension contributions, capital spending, interest expense and integration expenses constitute forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Such statements are based on currently available operating, financial and competitive information and are subject to various risks and uncertainties that could cause actual results to differ materially from the company's historical experience and its present expectations. These risks and uncertainties include, but are not limited to, inflation of and volatility in raw material and energy costs, the company’s substantial amount of debt, continuing pressure for lower cost products, the company’s ability to implement its strategies including productivity initiatives and cost reduction plans, currency translation movements and other risks of conducting business internationally, the impact of regulatory and litigation matters including those that impact the company’s ability to protect and use its intellectual property and company’s ability to fully integrate Altivity Packaging, and fully recognizing the anticipated benefits of combining the operations of Graphic Packaging Corporation and Altivity Packaging. Undue reliance should not be placed on such forward-looking statements as such statements speak only as of the date on which they are made and the company undertakes no obligation to update such statements. Additional information regarding these and other risks is contained in the Company's periodic filings with the SEC. With that out of the way I’ll turn it over to David.

Yesterday the company announced solid first quarter 2008 results excluding charges related to the combination with Altivity Packaging. Adjusted net loss was approximately breakeven compared to an adjusted net loss of $0.19 per share in the prior year period. The strong performance came despite closing a complicated transaction during the quarter and operating in extremely difficult inflationary environment. As I mentioned in last night’s earnings release despite the many hours necessary to complete the combination with Altivity, I’m proud that our teams never lost focus on the day-to-day operations. I am equally pleased with what I observed as the same focus and dedication in the Altivity organization as they continued to perform similarly to Packaging. I want to thank George Bayly and Don Sturdivant and their entire team for continuing to drive the results during this period of time. We are glad finally to be working as a single team. The logic of the combination with Altivity is powerful. We created a diversified packaging company with global reach, a shared history of innovative products and a manufacturing footprint to address customer needs in both the national account and regional packaging arenas. The timing of this combination is also important. Graphic Packaging is now the largest folding carton manufacturer in the world and we believe this increased size and scale will be crucial to successfully operate in the face of rapidly rising inflationary pressures and economic uncertainty. Graphic Packaging now approximately $4.4 billion in expected sales has the necessary scale to compete effectively in the global arena. Our manufacturing system is second to none in this space. We will include four CRB mills and two SUS mills combined producing over 2.4 million tons of paper. We will have 46 folding carton operations, the largest multi-wall bag network in the United States,…

As you saw on yesterday’s earnings release, first quarter financial performance shows strong improvement over the first quarter of 2007. Taking a look at some key metrics we see, as David mentioned, gross margins improved a full 2.4 percentage points to 12% from 9.6%. The EBITDA margin improved to 13.6% from 11.1%. To better compare performance to the prior year we adjusted 2008 EBITDA to exclude charges associated with the combination with Altivity. Finally, adjusted net loss improved by approximately $38 million to a loss of $1 million. Adjusted net loss excludes business combination charges. As David highlighted, operational management’s strong execution of our business strategy continues to drive financial improvement. In our financial results these improvements are reflected in continued success with our cost reduction programs, as well as price and volume increases. Inflation is partially offsetting the positive gains. Altivity results only had a minor impact on operating metrics as the transaction did not close until March 10. Please note that a reconciliation of non-GAAP terms as well as additional information for legacy Altivity can be found on our website at www.graphicpkg.com. It’s under the Investor Relations section. Before I provide further analysis of Q1 performance I’ll spend a moment on reporting segments. As a result of the combination with Altivity we positively diversified our company. Thus, we revised financial reporting segments. The Containerboard segment was combined into the Paperboard Packaging segment plus two new segments were created. Going forward, we will report in three business segments; Paperboard Packaging, Multi-wall bag, and Specialty Packaging. The Paperboard Packaging segment includes our highly integrated mill and plant system that produces board and converts it into folding cartons. This segment will also include the design, manufacture and installation of packaging machinery and the open market sale of folding carton grade board…

(Operator Instructions) Your first question comes from Joe Stivaletti - Goldman Sachs.

Dan, the pension contribution you are expecting for the full year of $60 million, is that your expense or your cash contribution?

That is our cash contribution.

How do you think that will compare to the expense?

That is going to be greater than expense. Somewhere in the range of $25 million.

So the expense will be $25 million lower than that roughly?

That is correct.

Those other numbers you just gave us, those are for the 9 months, the final three quarters for the year, the CapEx and the cash flow?

That is correct. The numbers we reported in the first quarter would be added into those to give you the annual numbers. I gave you the Q2 through Q4, which would be the combined company numbers going forward.

You said $160 to $170 for cash interest?

Right.

What were the non-recurring integration charges?

We didn’t give an amount for integration charges but our estimates are included in the overall cash number which we gave you guidance on. That would be in the $120 to $150 million range.

Are you able to break this NG down any more in terms of trying to give us a feel of what you may be able to show in your 2008 numbers, that $90 million?

What we’re going to do going forward starting with next quarter is we are going to give very precise information on the synergies and are rolling to the financials as well as the non-recurring costs that were incurred. I think at that time we will be able to provide more guidance on synergy activities including updates on the amount of synergies we expect overall. So the second quarter is going to have a lot of rich synergy information.

When you talk about the contract with the escalators and what not, can you quantify the percentage of your overall business that you now have where escalators apply?

It is across the entire business both for Graphic and Altivity. It is going to be a very, very high percentage of our business in at least the carton side of the business. When you look at paperboard, paperboard tends to be more of an open market as the price moves up the board price moves up. But in almost all the folding carton business it is probably on a combined basis at least 90% of our business will be in some a contract that will have some escalation process whether it is board or more recently in some of the larger national accounts they want more visibility with cost escalators, but regardless you’ll continue to see pricing move up in 2008 and in 2009 as we roll through the subsequent quarters.

What is the normal lag in those contracts? Is it a 30-day or 90-day cash due?

That has pretty much been our tradition. In most of those contracts we are trued up on a year’s basis. You look at the previous year’s inflation and then you capture it in the next year is the way it goes. There are some with a shorter duration. There really aren’t any beyond a year but for the most part I think the way we look at it is it tends to be a year lag for the carton side of the equation. Board pricing as the board price is announced and recognized it tends to move up pretty quickly for open market board.

The next question comes from Bruce Klein - Credit Suisse.

Will you touch a little more on volumes? You mentioned I think your beer shipments were up 3% and your soft drinks were up 6%. That was right? That was the first quarter over the prior year first quarter?

That’s right.

Food and consumer, was that up? I think your revenue was up but I didn’t know the breakdown.

In the food sectors of those businesses they were up. We exited in capacity preparation some areas that were not really food related for us so the net is just a slight up. If you look at what we would consider our core sectors, dry food, frozen food, almost all food, on average we were up 6% in those spaces and some of them were much higher. Like I said cereal was up like 15% year-on-year across space which obviously in that is pretty incredible in a space that is typically GDP level.

Those volume trends are continuing? That is bucking the trend a little bit with the general economy which you articulated some reasons why. Have you seen that?

What I would say is that our plants that are focused on those sectors of the market are pretty busy right now for sure. Those trends that we are seeing in the economy of people cooking at home, staying at home, less eating out clearly are supporting both the food side but also the beverage side. I made the comment that you are seeing on premise consumption drop and that hasn’t occurred for awhile so you are seeing more take home, more cans and bottle packs purchased in the grocery store and consumed at home. That is driving some of the trend. Certainly in beer and in the core food businesses. Center aisle of the store is where the growth right now is occurring both in the grocery channel but also in the club warehouse channel as well.

And the free cash flow application? What is the intended target for that?

All our free cash flow goes for debt reduction. Is that the question?

Bruce that would include the proceeds from the sale of the two mills.

The $22 million in charges, Dan where are they on the income statement? Is that varied? Did I miss that on the income statement?

In cost of sales would be $12.5 million and SG&A would be $9.8 million.

The CRB market, how would you characterize that in terms of the operating rates and demand and product pricing to offset OCC?

Product pricing of course there have been announcements out there in product pricing. We are seeing some of that materialize. Our operating rates are pretty solid, I think primarily driven because of the sectors we are in. Industry rates are certainly lower and backlogs are down year-over-year for sure in the space. I don’t have any indication that it will pick up much going forward other than of course the strength in the food space.

The next question comes from Derrick Winger - Jefferies & Co. Derrick Winger - Jefferies & Co.: Could you break out long term debt in terms of the line items and the balances and also in that could you give us the credit facility size, the amount you are on and any letters of credit against it? Secondly, any tax guidance in terms of absolute or a rate?

You wait until we file the Q and then you would have all that long term debt versus short term debt, letters of credit. You’ll have all that in the Q we’ll file later today. Derrick Winger - Jefferies & Co.: And the tax guidance?

We don’t pay cash taxes I think is the simple answer. Derrick Winger - Jefferies & Co.: On a GAAP basis are we going to see the same kinds of things we saw in the first quarter here?

With regard to taxes? Derrick Winger - Jefferies & Co.: Yes.

That is basically what you are seeing on the tax line is a non-cash number is the amortization of the tax good will and that will continue.

Any cash taxes paid is minor and it comes from international locations. Derrick Winger - Jefferies & Co.: When do you presume you might become a tax payer?

It is going to be a while based on our existing NOL. We’re looking to take benefit of that $1 billion plus NOL over the next several years. So we’re looking pretty far out in the future before we expect to pay taxes.

The next question comes from Willis Taylor - Gagnon Securities.

Given that you consolidated 21 days of Altivity results can you discuss why depreciation and amortization and interest expense were both down versus last year?

I can. It is a couple of things. Depreciation and amortization was down because we took accelerated depreciation on certain assets we were taking out of service. In terms of interest expense that’s primarily the difference in the rate. The rate of interest was favorable over 2007.

We refinanced in May as well.

Refinancing in May our spread was two points. That was significantly better than what we had before. Plus the overall rate was lower.

What is on hedge? What is the position?

On hedge we are approximately at 35% floating.

For the last several years the CapEx spent has been considerably less than depreciation and amortization. Could you help us think about how that is going to trend in the future?

I think you are going to see approximately the same trend in the future. We’ve had a combination with Graphic Packaging where we wrote off the assets and now we are having a combination with Altivity where we wrote off the assets as well. So you’re going to see that same type of trend in terms of CapEx being lower than depreciation.

The next question comes from David Marcus - Boone Capital.

I was curious in terms of your timing and plans for investor relations. Now that you’ve got the merger done and you’ve posted good numbers for the quarter. I’m curious when you’ll be out speaking at conferences and meeting with investors?

We’ve done certainly we have already done some debt [rad] conferences and talked about that for sure. Scott and I had a conversation this morning before this call and we are in the process of working with some folks to create a road show here before the end of the second quarter, at least to talk about where we are. So that’s what our target is right now. I think important for us is to explain our story but also we want to have a quarter or so behind us to be able to show what the synergies are doing and being able to talk with some amount of clarity around what the future earnings and cash flow look like in this business. So we’re trying to get that done and then go and talk to the Street about the future prospects, so, certainly during 2008.

The next question comes from Jeff Harlib - Lehman Brothers.

Just the $120 to $150 million cash flow number you used does that include any asset sales or any unusual cash flows, in flows or out flows beside pension and some other things you mentioned?

No, that’s just operating cash for debt repayment. The mill sale would be incremental to that.

On the cost savings the $90 million, I know you aren’t going in to too much detail yet but are what are some of the things that you are working on more in the near term and what are some of the actions that are pushed out in to 2009, 2010? If you could give a cost savings of synergy target for 2008 run rate that would be helpful.

First of all we really haven’t done mush pushing out. We have in fact accelerated. I already announced the fact we’ve closed two manufacturing facilities or announced the closure of two manufacturing facilities, so we’re well on the process of the plant rationalization work. I think the one we’re focusing the most on right now is really in the procurement area. That’s an area where it gives us both earnings and cash and by virtue of our leverage with Altivity now that we have been able to see combined purchases we think there’s upside opportunity in purchasing. So in these synergy activities the things that generally come first are the overhead reductions, which we’ve talked about announced, the combinations of the staff, the combination of the business units and so we’ve seen some of that starting to flow through. Next will be the purchasing synergies because as we get to look through those numbers we are able to translate some of it very quickly. Those areas where we are purchased at the different price for the same unit, for example, and then we’re starting some bidding activity for our larger purchase to goods and we’re in the process of being able to do things like transportation, things like chemicals, corrugated, those types of things. The things that tend to trail are the plant closure activities. The impact on those is less because as you can well imagine the shut down in severance cost in the year tend to absorb a lot of the savings so what we do in 2008 probably won’t manifest itself until 2009. Dan talked about in the second quarter we are starting to see some synergies that we will detail out what those look like and what categories they’ll be in the second quarter and I think that will give you a better feel. But right now as we just merged 20 days ago synergies are mostly effort that we’re working on results to come.

How does overall capacity utilization look for the combined companies? Both mills and folding carton plants?

That is two separate questions. Of course we already announced the fact we will be rationalizing some of our folding carton capacity. It’s not so much that we’re taking a lot of capacity out but we are certainly upgrading the capacity that we are utilizing. We have got some parts of our organization which have some slower, older, really assets that are not contributing above cost of capital. Those assets will come out of our system. From a mill standpoint we continue to say that we will operate all of the mills that are in our business, post of course the divestiture of Philadelphia and Wabash as part of the consent decree. Capacity utilization in our SUS mills has been very tight. The industry is tight on SUS capacity for sure. Our CRB mills ran well and capacity was good in the first quarter. I think the industry is a little softer. We may not have felt as much of it because our mix is focused more on food and that tended to be up, but certainly we’ll balance our capacity for board with our demand in folding carton as we have traditionally done.

Lastly, you mentioned the folding carton contracts are typical annual contracts. Are they weighted to any particular quarters which can benefit certain quarters versus other quarters?

No. First of all the contracts are generally not annual. So I didn’t mean to imply that. They are generally three plus year contracts. They have annual escalators for input cost changes primarily. But our business has some seasonality if you’d like. Beverage is certainly busier this time of year and up to the summer and falls off in the fall. In the fall traditionally is when we see our food business pick up because back to school drives a lot more cereal and pizza. Now we’ve seen some counter trends here in the first quarter, of course, but I think that has more underlying economic issues than actually a change. But the contracts themselves really do not have any quarterly or any seasonality basis for pricing or supply.

The next question comes from Vic Kumar - South Coast Partners.

The $22 million in improved manufacturing costs that you had primarily on the West Monroe mill. I just wanted to get a better sense of how that was achieved and is that something that you expect to see continuing in future quarters or is was last year’s quarter a weak time for the West Monroe mill?

Well, actually a little bit of both. Last year’s quarter you may remember we had a very difficult operating quarter in West Monroe. But we have also invested in West Monroe to change the amount of wood and energy that we used in that system so you got a little bit of both. I made a comment in my script that said we invested in the digesters in that system and we have. That allow us to burn more bark as opposed to natural gas. Right now our bio mass utilization is a blessing. Buying natural gas as we go forward is going to be more and more expensive. I think in the first quarter we were hedged at about $8 but as you go forward, certainly natural gas is going to go up and so we have consciously made an effort to use more bio mass derived fuel and we saw that in West Monroe. So we will continue to see improvement in West Monroe. I think our total business use suggested for the first quarter was up from a performance standpoint around $37 million. Dan?

$35 million on the quarter.

$35 million on the quarter so we are raising our original targets. We talked generally about $50 million or so improved stand alone improvement but I think those numbers are clearly going up. Altivity’s quarter I will say for unaudited numbers what I’ll tell you is their performance in cost take out was excellent. So what I would say going forward is the overall cost take out will at least be at this level, potentially accelerate in some areas of the business. Dan’s comments are accurate that if you combine the cost take out with the pricing in the combined businesses despite the fact we expect to see inflation at roughly the same rate we do expect performance to improve by virtue of those combinations. A lot of it will come from the mills.

As part of the merger, you have to divest a couple of mills. How does that affect the run rate EBITDA for Altivity from 2007?

It’s really inconsequential.

You mentioned in the overall CRB market that food is obviously doing very well. What are the segments that are struggling?

I don’t have quite as much visibility over those areas because we don’t participate, and quite frankly if you look at Altivity’s mix it is very much focused like ours. It is in food and beverage as well. But I’m pretty sure areas that are struggling are going to be anything supporting durable goods, areas, the toys, games, media, and those kinds of things. Those are all real difficult economic places right now. We have also seen some of the restaurant supported products; they are struggling a little bit as well. People just aren’t eating out as much. So the products associated with carrying products to those establishments are certainly struggling in the space. I think it’s a different economy right now and I like our position in food and beverage, but by no means are we insulated from an economic slowdown in the United States.

The next question comes from Frank Duplak - Prudential.

Back in the middle of March you put up a chart on your website that talked about projected capital spending and it looks like today’s guidance the full year 2008 number will be below that level you indicated there. Just curious any thoughts yet about 2009? I thought you had 2008 and 2009 in the $237 million area flat year-over-year. Any ideas about 2009 CapEx at this point?

I think that 2009 CapEx is probably a reasonable number at this point. In terms of 2008 what’s happened since the combination of the two companies we were able to look at what they planned to spend on capital and what we planned to spend on capital, and we were able to rationalize quite a few projects because they overlapped. Or our business strategy had changed. So that’s where the savings have come from. So I think in 2009 we haven’t gotten that far that we’ve really looked at what was the details in their plan versus ours. So I think that original guidance that we provided is where we’re standing right now.

You have got to remember that as Dan and I talked about before we really had a chance to look at the two businesses we had a rough idea of where we were going to spend money, but really not appropriate for us to look at level of detail. But now that the team and Don Sturdivant and his team working with Mike Doss and once they have gotten together and looked at they realized there were some things that could be done differently or better than we had originally planned and with an eye towards preserving cash for debt reduction we’ve made those decisions. But I will tell you, I want to make sure that we are not slowing down synergy acceleration, nor are we changing our equipment improvement upgrades or the plant investments we’re making are the same that we were making before. Timing may be a little bit different but that’s it.

Can you talk about the mill sell process at all? Are you willing to talk about how things are going? Any update there?

We’re on time with our expectations on it. We hired an outside investment banker to help us. We have gone through the initial processes. Plant tours have occurred. We have a number of buyers who are interested as you can well imagine. We expect to be finalizing that and closing that before the end of the year.

Your final question is from Matthew Armas - Goldman Sachs.

Can you say if you had any mark to mark hedge gains in the quarter in natural gas? As well as what your hedge position in natural gas is for the rest of the year?

I think in the first quarter I don’t believe that there are any significant mark to market gains on the nat gas hedges. We were hedged at around $8. I think we probably actually bought slightly north of that but I don’t believe it was a material number.

Looking at the remainder of the year we are 60% of our expected usage hedged in the second quarter and then we dropped down for the remainder of the year to about the 25% level. And that’s for the combined entity of Altivity and Graphic. The average rate in terms of those hedges that we’ve got in place is slightly below $8.

There are no further questions at this time.

We thank everybody and we’ll talk again next quarter.