Ladies and gentlemen thank you for standing by and welcome to the Hormel Foods fourth quarter earnings conference call on today, 24 November 2009. (Operator Instructions) I will now hand the conference over to our host Mr. Kevin Jones. Please go ahead sir.

Good morning everyone. Welcome to the Hormel Foods conference call for the fourth quarter of fiscal 2009. We released our results this morning before the market opened around 6:30 am Central Time. If you did not receive a copy of the release, you can find it on our website at www.hormelfoods.com under the Investors section. On our call today is Jeff Ettinger, Chairman of the Board, President and Chief Executive Officer; and Jody Feragen, Senior Vice President and Chief Financial Officer. Jeff will provide a review of the operating results for the quarter and the year. Then Jody will provide detailed financial results for the quarter. The line will then be open for questions following Jody’s remarks. An audio replay of this call will be available beginning at 10:30 am Central Time today, November 24, 2009. The dial-in number is 800-406-7325 and the access code is 4173819. It will also be posted to our website and archived for one year. Before we get started with the results of the quarter, I need to reference the Safe Harbor statement. Some of the comments made today will be forward-looking and are made under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those expressed in or implied by the statements we will be making. Among the factors that may affect the operating results of the company are fluctuations in the cost and availability of raw materials and market conditions for finished products. Please refer to pages 28 through 34 in the company’s 10-Q for the quarter ended July 26, 2009, which was filed with the SEC September 4, 2009, for more details. It can be accessed on our website. Now I’ll turn the call over to Jeff.

Thank you Kevin and good morning everyone. Our priority in fiscal 2009 coming off just our third down year in 26 years was to get back on track in terms of earnings growth. We are therefore pleased to see that our strong earnings momentum from the past two quarters carried through the fourth quarter as well. Earnings per share for Q4 increased to $0.77 up a substantial 54% from a year ago and all five business segments contributed to the results. Also impacting this result were investment income and non-operating items which Jody will address later. For the full year our earnings per share were $2.53 up 22% from last year, total segment operating profit was up 7% from a year ago. Total company sales for the quarter were $1.68 billion down 10% from a year ago. Part of this substantial decrease is attributable to the planned reduction of turkeys at our Jennie-O Turkey Store segment, decreased sales revenue due to lower commodity prices in our pork and turkey complexes, greater promotional spending, our continuing weak food service sales environment, the loss of Carapelli sales and some additional intentional product rationalization. In addition our top-line was impacted more significantly in Q4 by changes in consumer spending. For the full year, sales were $6.53 billion down 3% from 2008. I will now take you through each segment. For our grocery product segment, segment operating profit was up 12% and sales were down 12% for the fourth quarter. For the year segment operating profit was up 9% and sales were down 2%. Segment profit was aided by lower raw material costs and reduced freight and warehouse expenses. We also achieved an improved product mix as certain less profitable sales were rationalized. Strong sales of Hormel Chili added to the improved results for…

Thank you Jeff, good morning everyone. Earnings for the fiscal 2009 fourth quarter totaled $103.9 million or $0.77 per share compared to $67.8 million or $0.50 per share a year ago. Earnings for the 12 months for fiscal 2009 totaled $342.8 million or $2.53 per share compared to $285.5 million or $2.08 per share a year ago. Selling, general and administrative expenses in the fourth quarter were 8.5% of sales compared to 7.1% last year. Year-to-date, SG&A expenses were 8.7% of sales for 2009 compared to 8.2% last year. Advertising expenses were 1.1% of sales for the quarter compared to 1% in 2008. Year-to-date advertising expenses were 1.4% of sales compared to 1.5% in fiscal 2008. As just stated, we expect to see increased advertising expenses in fiscal 2010. Interest and investment income was $2.2 million for the fourth quarter compared to a loss of $20 million in fiscal 2008. For the full year interest and investment income was $19.6 million compared to a loss of $28.1 million in fiscal 2008. Favorable market returns on our Rabbi Trust investments drove the improvement. We have transitioned this portfolio into more fixed returns investments to help limit our exposure to market volatility going forward. Interest expense for the quarter was $6.7 million compared to $7.4 million last year. Year-to-date, interest expense is $28 million even with last year. We expect interest expense to be approximately $27 to $29 million for fiscal 2010. Our effective tax rate in the fourth quarter was 34.1% versus 41.9% in fiscal 2008. The year-to-date effective tax rate is 34.7% compared to 37.6% last year. The effective tax rate in 2008 was negatively impacted by the non-deductible Rabbi Trust losses. For fiscal 2010, we expect the effective tax rate to be between 35% and 36%. The basic weighted average number of shares outstanding for the fourth quarter and full year was a 134 million, the diluted weighted average number of shares outstanding for the fourth quarter was 136 million shares and 135 million for the full year. Long-term debt at the end of the quarter was $350 million, our short-term line of credit was repaid during the fourth quarter. During the quarter, we also made an additional $45 million contribution to our pension plans bringing our total contribution to over a $100 million in 2009. Capital expenditures for the quarter totaled $26 million compared to $30 million last year. For the full year capital expenditures totaled $97 million compared to $126 million last year. For fiscal 2010 we expect capital expenditures to be approximately $140 to $150 million. At this time I’ll turn the call back to Kevin.

I would just ask our sell side analysts to please little your questions to one question plus one follow up question and if you have any further questions to get back at the end of the queue. I apologize for the inconvenience but I just want to make sure everybody has an opportunity to ask questions. Operator, at this time we will turn this over to the question-and-answer portion of our call.

(Operator Instruction) Your first question comes from Farha Aslam - Stephens Inc.

Jeff, you had mentioned throughout your commentary that freight and warehousing was lower. Is that market conditions or is there something that Hormel is doing that is more structural?

I think it’s a combination of both. We clearly have seen market relief on some of the major fewer related costs. But our team has done a very nice job attaining logistics efficiencies in the operation and those should continue going forward.

And so, if you had to kind of break down the profitability of that pieces, more structural, how much would you say we can translate into future years roughly?

I really, I mean, I have never done that. So I would really be having to wing it. So, maybe we can follow up with you at a later time to be able to quantify that a little bit more precisely.

That would be great. One follow up, in terms of volumes that you see in your business going into next year particularly for refrigerated foods and your turkey division, any color on that?

On the question of volumes?

Yes.

We plan to hold to the level of production cuts that we established at Jennie-O. So I would expect volume to be fairly flat at Jennie-O on an annualized basis in 2010. For refrigerated foods, our expectation is to see a decline in the later part of the year in terms of available supplies kind of what we had originally thought was going to happen in 2009 and so right now that’s what we’ve based our plans on.

Your next question comes from Akshay Jagdale - Keybanc.

So just wanted to just question a little bit on your guidance and what it implies for divisional EBIT growth. I mean If I run the math, and I may be off, but it implies about double digit earnings growth at the divisional level, if that’s correct and if I’m not if you could tell us what your modeling or sort of give us a sense of what type of growth you are expecting from the divisions that would be great. Then just talk to, what your expectations are with each of the divisions. I mean from my perspective obviously turkey we should continue to see earnings growth there given the numbers we are seeing on the cold storage etc. But if you could give us a little bit more guidance on what you are expecting on grocery products as it relates to your marketing spent etc. that will be great.

Okay. At an operating level similar to what we discussed at Investor Day, we do expect to have stronger operating results than the total EPS figure would be. So we are modeling at kind of around 9% increase on a year-over-year basis at the segment level. Grocery, we kind of look at them versus their peer group and look at maybe a 6% level as being probably an appropriate growth rate to task that group with. The other groups we look at what we have articulated as our long term guidance which is kind of in the ballpark of our 10% goal. From an advertising standpoint we did introduce ad campaign in the later part of 2009 for Jennie-O Turkey Store and for Spam, we are working on a new campaign for the umbrella Hormel brand, which will be hitting the marketplace probably in February and on an annualized basis we expect to increase our ad spending on a year-over-year basis in 2010.

Just one follow one for Jody, in terms of the cash, again I guess a good position to be in with about $3 a share in cash on your balance sheet. Can you just talk about cash allocation? Are you modeling anything for buybacks for next year or should we assume that the guidance just takes into account the same number of shares outstanding.

Obviously we intend to use our cash to return to our shareholders and certainly the dividend increase that we announced today starts that process. I would say the next we would really like to reinvest back into businesses to grow them. Obviously we expect to see capital expenditures bump up versus where they were in 2009 as we were very deliberate about trying to put some cash on our balance sheet given the uncertain credit conditions in the economic conditions overall, so we will see those increase both to do some strategic investments on productivity level and the plans as well as just to get caught up on some of the normal repair and maintenance things that we do. So I don’t know that we specifically modeled a huge share repurchase into the EPS numbers that we have guided towards, but if we have cash we will deploy it as we should.

Your next question comes from Diane Geissler – [Alpha].

Can we just talk about the sales line a little bit, particularly in the grocery products group. You highlighted several key factors and I understand that commodity exposure and what’s going on there. But could you talk about what you saw in the grocery products group in terms of what was the impact of Carapelli, what’s the impact of microwave, what was the impact of promotional, if you could maybe give us some sense of the scope and size there?

Okay. I mean those were roughly a quarter of the decline with Carapelli, a quarter of decline with added promos done, overall we saw some softness in terms of some of the franchises that earlier in the year has had very strong momentum. So that clearly is one of our tasks of our team going forward is to restore momentum in those areas, and so, even beyond those one-time items there clearly was an effect, not just grocery product but the whole company had very strong sales in Q4 last year. I mean we reported I think was 11, 12% increase. So we were up against those sales. We obviously don’t like to get sales from this kind of a situation, but last year there were a couple of significant hurricane incidents in the country that impacted both the grocery product sales and our food service sales in a positive way in 2008, which were obviously was not repeated in 2009.

Okay. And then I guess just as a follow up on the promos spending on that piece. So what should we be looking for in terms of what you will have to spend back behind the products in grocery as you move into the early part of 2010?

Well, the one area that we are clearly still trying to get our footing with is microwave. We spend fairly aggressively against that category in the latter half of the year and we would anticipate continued efforts there until we find the way to get that franchise going against. Excluding that and excluding any comparable effects for MegaMex which will have some moving parts in terms of how that’s reported, otherwise promotional spending for grocery products should be consistent with the traditional franchise.

Your next question comes from Christina Macglone - Deutsche Bank.

Jeff, I saw that guidance for ‘10 was better than kind of your tone at the Investor Day, maybe it’s just my impression but I’m wondering if anything improved since then or maybe what changed if anything changed?

Well, the overall range of both ‘09 result and our ‘10 guidance shifted upwards since we were talking at Investor Day, we did finish more strongly here and feel comfortable in our ability to deliver the 263 to 273 range that we’ve now established for 2010. Otherwise I think what we are trying to indicate in Investor Day is clearly our long-term guidance that we have provided is that we wanted to grow our bottom line by 10% and we recognize even the range we have provided doesn’t do that at an EPS level and we come very close to doing that at a segment profit level for 2010, but with the head winds of that are run by trust and the added pension expense as we talked about in investor day, we thought that would impact our ability to bring all 9% down to the bottom line in terms of EPS.

As a follow-up, I was just curious about, you talked about expanding that’s going to be flat in the fourth quarter is that more of a comp issue or what exactly is going on there and will it start to ramp up again.

I expect both of those franchise do well in 2010. the Mexican we have strong efforts as we now put the MegaMex adventure together, they have some sales successes that they have already generated they want some will ship Q1, some will ship Q2 but I’m expecting big things out of that operation. The Spam team has done an excellent job at rejuvenating that brand and connecting with more consumers and I’m looking at Q4 as more and immorally.

Your next question comes from Robert Moskow - Credit Suisse

Well I think we have been kind of whipsawed the last couple of years, the last year it was in the form of plenty of sales and not much in the way of bring it or on bottom line and this year perhaps the pendulum as the year ended swung a little hard at the other direction, I don’t expect grocery to maintain the 20% level, I think we wanted the kind of incrementally increase it from the 16 that it had been into and back into the 17 and 18 range and clearly 20 is somewhat a product of a depressed sales number for that quarter versus obviously what the earning number turned out to be.

Do you thing 16 to 18 is the right range maybe little bit higher 17 to 18.

Yes I thing that’s what we would be comfortable, because I know a lot of the other package food companies have talked about that as kind of a target level and clearly we talked about wanting to increase our ad spending, grocery is one of the area that will come in and so we want to make sure we are continue to both grow the traditional franchises and have some ability to sponsor new items as they come out it within that portfolio and within our other segments.

Okay. And lastly, you are not alone in alone in facing challenges in Microwavable meals in this economy, and I think that the companies that are going to do well for the next year are going to be the ones that are prepared for a weak consumer spending environment, and are putting money in the right places. So, I was kind of surprised to hear that you dialed up the marketing on Microwavable meals in the back half. It sounds like it didn’t have the intended effect. Do you feel like you are kind of chasing after a consumer that just isn’t ready to pay for items like Compleats perhaps, and really want some more of the can chilly, or maybe products that are used as meal enhancements for cooking at home?

Well, I was referencing specifically promotional spending as we did have a couple of price increases on that line over the last couple of years, and so that was one of the things we certainly want to explore with our retail partners, is whether there is an optimal promoted price point, or shelf price point that will continue to enhance volume there. When you get to marketing on a bigger picture basis, I mean the Hormel brand is going to be our lead item within our advertising portfolio, and we still believe in Compleats as an element of that advertising spent and I think we will feature natural choice we may have something with Hormel Chilly, we may have something with our party tray items and our pepperoni items. But we still view Compleats as being very strong contemporary items that are good value for consumers and that are worth getting behind.

And maybe I can just sneak in one more on the refrigerated section, because that division did do a lot better than I thought, and it looks like it’s a shift to value add. What are you seeing in terms of consumer trends in that refrigerated meats kind of category? Are all the players doing well or are you taking a lot of market share, it seems like we have seen pretty decent results from misfiled foods and kraft and even [cereal] altogether, is that part of the store or grocerers very happy with that part of the store or is this really just kind of a margin kind of thing that you guys are all enjoying at the same time?

I think that part of the store has held up in certain areas, I can’t speak to the other companies, but looking at our franchise particularly on an annualized basis we had an excellent year with natural choice. We had an excellent year with pepperoni, we saw a little bit of that softness in our meal segment in terms of the Hormel refrigerated on trays and Lloyd’s, and so that would be the one area kind of to your point earlier about convenience, but maybe there is a little bit of a trade down going on there. But overall we had an excellent year in our meat products area, both from a volume and a margin standpoint and have a good momentum heading into the next year.

Your next question comes from Eric Larson - Soleil Securities.

Could you give us a quick look as to what you think, the hog price outlook is for the next 6 to 12 months. Obviously prices have come up a little bit. You didn’t mentioned an awful lot about that. And you gave a very good thorough review at your analyst day. Can you just give us maybe some incremental thought from what may have changed since then or what your thoughts are?

Yes, I guess I’m the hog person.

Hi Jody.

I quit giving specific guidance even though I was getting fairly good at it for a while there. We have seen about a 2% liquidation, I think the USDA is calling for something in the range of 4% going forward. From the discussions I have had with our folks here a lot of the liquidation in the herd is being offset by increased productivity. So, I would plan that for the first half of the year I think we are going to see quite moderate prices on hog. Now, obviously they seem to jump around, and we have seen some strength there lately, and then in the back half we are kind of expecting some of the reductions and the herd will come to roost and we will see the prices increase, but hopefully at a modest level going forward.

Okay, the follow up question here for me is, kind of back to the grocery and with a thrifty consumer we have kind of all, we are kind of beating the horse to death a little bit, but I suspect that in order to create the proper value or incentive for consumers to purchase your products, your promotional spending ratio would probably remain quite high, would they not, Jeff, going into next year, as opposed to a car lot price decrease?

I think that’s fair to say that we will steer our efforts to stimulate certain brands in the promotional area. I just would acknowledge again just how choppy it is out there right now, and that’s what we are trying to deal with. I mean just even in Q4, Hormel Chili was still up, Spam was relatively flat and Jennie-O was down, and the all three had been these traditional can franchises that in the early part of the recession, consumer seem to be gravitating toward and now it’s a little bit more of a mix bag, it’s a little harder to read, could be in part though the comps we were dealing with in Q4 of last year. But I think to your general point I think that’s correct, that we will want to try to attain the right feature price for consumers to continue to drive volume for these franchises.

Your next question comes from Ann Gurkin - Davenport. Ann Gurkin - Davenport & Company LLC: Jody, did I hear you say we might hear news of an acquisition in the near term, is that correct?

No, I said we have nothing to announce today, sorry Ann. Ann Gurkin - Davenport & Company LLC: Okay, I was just going to ask what the positive might be. Okay. My other question is what are you including for contribution from export markets in 2010?

Well, I mean it’s been somewhat trouble situation for us this year, particularly China. We have made up for that somewhat with quite strong exports to Mexico and that seems to be still looking fairly favorable. We hear positive things about China opening up, we haven’t seen a lot of evidence of it yet in our shipments, but we are certainly hopefully of that going forward, and as always, I mean in the scheme of our total business that’s not a big direct factor, but it certainly can have market effects that would be very significant. Ann Gurkin - Davenport & Company LLC: Okay, so you look for some growth maybe in 2010?

That’s what we would hope to see.

Your next question comes from Jonathan Feeney - Janney Montgomery Scott LLC.

So I guess, if you wouldn’t mind just giving me a little bit more detail, and I know this is something you have done historically, but on the other hand it’s kind of an unusual situation. When you look at the guidance for next year, I think you have been very clear about the high single digit, to like looks like 8% to 10% type range in segment operating profit. What kind of volume would you need across the segments to drive that do you think, looking overall as it, maybe can you give me a sense what’s going to be up and down to sort of get to that range?

Okay, the first half of the year on an overall basis, we are expecting it to be flat to even potentially slightly down as built into our plan for next year, gaining some momentum as the year goes on. That again as I mentioned earlier in the earlier part of the call that’s all sort of netting MegaMex, I mean we will see revenue increase that’s $80, $90 million over the course of the year, that that’s going to add to the top line with the new franchise that that group sells that will go through the grocery division. So, we will see that, we also call that out each quarter as to how much is affected by that new business and how much is organic growth. Overall though to hit the guidance range we are looking for, we need to restore momentum in our top line, by the second half of the year, or we are not, we think the cost environment that we benefited from continue to help us in the earlier part of year, but we recognize that ultimately we have to have robust franchises to get our long term objectives.

And I guess specifically, if you could drill down into grocery versus refrigerated, assuming the others are sort of, I mean would you be looking for that trajectory of growth to be more pronounced in terms of improvement over the course of the year in grocery, because of what maybe recovery in microwavables is that what you are looking for or is it that you are counting on sort of export volumes or just overall we did food service volumes to drive your refrigerated foods business, I mean which of those two do you think would be a stronger volume driver next year?

Well, I guess I don’t know that I would pick one over the other. I think maybe the best guidance I could give you would be that our articulated long term goal for our franchises is 5% growth, that maybe difficult to hit on an annualized basis. We certainly expect to be tracking at that kind of pace by the later part of the year, and we expect to have sales deposit on an annualized basis.

The 5%, you are talking about the sales number, right?

Yes.

Your next question comes from Diane Geissler - Alpha.

Can you just tell me what were your realized prices on hog this quarter, did you give that and I missed it?

We haven’t been giving those numbers out. But I would tell you that it was slightly less than last year.

Slightly less than last year. And what did it look like on a sequential basis?

This quarter versus last, oh man, I don’t have last quarter’s numbers with me today.

I can forward.

Maybe I can get that from Kevin.

Your next question comes from Akshay Jagdale - Keybanc.

Actually I wanted to ask something that Diane asked, in terms of the, I was just looking at hog prices this quarter, and according to spot data they were at $36 live weight which should be down $17 or $18 year-over-year. But I guess what you are trying to tell us is that, that’s not what you realized, is that correct?

We realized that they were less than they were last year, our hog cost.

Okay, but not as much as I am indicating here?

So, I just wanted to get a sense of maybe if you can give us a little color on the different moving parts. I know you have talked about Lloyd’s a little bit, but just talk a little bit about the three different parts in refrigerated foods for this quarter.

I mean from our standpoint we thought refrigerated foods actually ended the year very strongly. We were suffering earlier in the year from the kind of week and week after week of those negative cut out margins which we recognize as just one of the number of factors that are important to refrigerated food.

(Operator Instructions) Your next question comes from Robert Moskow - Credit Suisse.

I’m just trying to encourage Tim Raymond to call in with a wine selection for the Thanksgiving.

Don’t you guys have anything you can throw out our way, I am more of a diet coke fan.

I think just as long as you go at the Jennie-O Turkey or Cure 81 Ham we have that part of the meal coverage.

You too.

Ladies and gentlemen this concludes today’s conference call. Thank you for your participation and you may now disconnect.