Good morning. My name is Kelly, and I will be your conference operator today. At this time, I would like to welcome everyone to the Iron Mountain Incorporated Q3 2008 Earnings Webcast. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions]. Thank you. I will now turn the call over to Mr. Stephen Golden, Vice President of Investor Relations. Please go ahead.

Thank you, and welcome everyone to our 2008 third quarter earnings conference call. After my announcement this morning, Bob Brennan will give his state of the company remarks, followed by Brian McKeon who will deliver the financial review. When Brian is finished, we'll open up the phones for your questions and provide the answers. First, a quick word on the new starting time for our quarterly earnings conference calls. We believe a full discussion of our results, sooner rather than later and closer to the timing of our press release enhances our overall disclosure, especially given the current state of the capital markets. We appreciate the importance of timely distribution of information and we hope you find this helpful. As a note, 8:30 will be our standard start time going forward. Next, I'd like to thank everyone who joined us for our annual Investor Day events earlier this month. It's an event we look forward to every year, and hope you found the presentations both interesting and informative. As always, we appreciate your continued support. For our custom, we have a user-controlled slide presentation on the Investor Relations page of our website at www.imountain.com. Referring now to slide two, today's earnings call and slide presentation will contain a number of forward-looking statements, most notably our outlook for our 2008 financial performance. All forward-looking statements are subject to risks and uncertainties. Please refer to today's press release or the Safe Harbor language on this slide, for discussion of the major risk factors that could cause our actual results to be materially different from those contemplated in our forward-looking statements. As you know, operating income before D&A or OIBDA and free cash flow before acquisitions and investments are metrics we speak too frequently, and ones we believe to be important in evaluating our overall financial performance. We provide additional information and the reconciliations of these non-GAAP measures for the appropriate GAAP measures as required by Reg G at the Investor Relations page of our website, as well as in today's press release. With that, I would like to introduce Bob Brennan, our President in CEO.

Thanks Stephen. Good morning everyone and thank you for taking the time to join us for our Q3 earnings call. Messages... the purpose of our call today is to let you know that we are pleased with our performance. We are as expected feeling the pressures associated with this environment, but we believe that they are very manageable. And that we in turn can hit the targets that we've set for ourselves. As Stephen said, it was great seeing you all at Investor Day on October 8th. We thought it was a good day and appreciate those of you that chose to attend, whether in person or via the web. We always appreciate the opportunity to meet with you, highlight the health of our business as well as speak to our outlook. Since we just spoke to many of you on Investor Day about our strategy in detail, today we're going to go through our Q3 results, and provide a very brief update on areas of progress and advancing the strategic agenda that we set out for you on Investor Day. The big issue that's developed for us in the past few weeks has been the swings in the currency market, and its effect on our reported results, which we will explain in deeper detail. Before we begin, I would like to take a moment to reinforce some of the key themes that we shared with you at Investor Day. The first point is that Iron Mountain continues to perform well. We achieved solid 8% internal growth again in Q3, and remain on track to sustain targeted 79% internal growth this year, and again next year in 2009. And while we're performing well across all our segments, I want to point out that our North American performance in particular is…

Thanks Bob, and good morning everyone. Q3 was another solid quarter for Iron Mountain as we posted strong revenue growth and OIBDA gains ahead of our forecast, supported by 8% internal growth. These results reflect solid operating performance across our business units. As usual today, we'll review our quarterly results and provide an update on our year-to-date cash flow performance, capital spending trends, and our debt position. Given, unusual recent changes in foreign exchange rates, we'll also spend time today discussing the impacts of foreign exchange on our reported results. Significant fluctuations in FX rates during the third quarter required recognitions of large non-cash charges and deferred tax provisions, which lowered our reported of EPS by about $0.17 per share. The record strengthening of the U.S. dollar in recent weeks is also requiring us to make adjustments to our 2008 full year guidance. As projected, FX impacts in the fourth quarter were more than offset operating upsides in the business. As we discussed at Investor Day, fluctuations and factors such as currency rates can impact our reported results. These factors however don't alter the fundamental soundness of our business, which is performing well and is on track. Let's now turn to slide four to review the key messages from today's review. The primary message that you should hear in today's review is that our operations are performing well. Iron Mountain delivered strong financial results in Q3 with revenue growing 12% and OIBDA growing 14% on a comparable basis, excluding asset gains and losses. We continued to drive solid business performance in a challenging economic environment. This reflects the strength of our business model as well as benefits from a disciplined management approach. We posted strong revenue gains across all major business units, supported by 8% internal growth, the benefits of…

[Operator Instructions]. Your first question comes from the Kevin Mcveigh with credit Suisse.

Hi Kevin.

Hey guys. Nice job on the quarter. Just one quick thing Bryan, at some point your not updating the '09 guidance at this point, is it fair to say there maybe some incremental positive impact that could offset the incremental 3.2 from the currency headwind versus a couple of weeks ago in the business?

We just didn't want to get into a formal update of guidance so quickly after I Day. We're maintaining our underlying operating outlook Kevin. Obviously, FX has moved quite a bit. We wanted to highlight that for you and we'll be refining our outlook in the coming weeks. But we're not changing our underlying outlook and we can't predict the FX right now. They could obviously move in a different direction and we'll... year end we'll give you an updated perspective on that front.

Great. And then just a quick, the core services... real nice job on the 13% internal growth. Can you just break that down little bit kind of see where the strength was, and kind of what you're thinking into the fourth quarter as well?

To our note, it was a strong quarter, it built on a strong quarter we had in Q2. Would you get some benefit from fuel surcharge increases. Just to revisit the fuel surcharges and our energy cost kind of move together, we... for our transportation related services. We see a benefit in revenue when our underlying transportation cost is going up and obviously that we have some offsets in higher costs. In terms of our revenue growth that added about 4% to the core service growth rate in Q3. So having said that we're still at a solid 9%. We would expect some mitigation in the fuel surcharge increase, just given that oil prices have come down, that will also see some lowering of our transportation cost, so those should net... and other than that I think we're maintaining solid core service growth.

This kind of great job.

Yes. The pressure on our business is more in the discretionary areas like complimentary services I noted that we are getting some benefits from higher pricing and we are strengthening our service margins in markets like the U.S. And we're continuing to see good activity in the storage and related service fund its the pressures that we've seen in the business or as expected more in the complimentary areas.

Great. I'll get back in the queue. Thank you.

Thanks Kevin.

Your next question comes from Andrew Steinerman with JP Morgan.

Good morning, Andrew.

Hi, there. My question is about the fourth quarter implied up margins compared to the third quarter. I heard in your prepared remarks, some comments about timing of projects third quarter versus fourth quarter, maybe you could jump in to that. And I just want to be very clear, and I think you're saying that FX does not affect margins fourth quarter versus third quarter.

Yes let me try to take that on. At mid-point, our outlook for Q4, Andrew I believe would be similar margins between Q3 and Q4 kind of in the 20, I'm sorry Q4 would be in the 26% range, and we have a similar kind of year-over-year improvement. I think we're trending sort of in the... if you take out some of the noise around the asset gains and losses, I think we're in the 50 to 100 basis point improvement. So we're pleased with that kind of progress and we implied in our outlook for 2009 is continued progress on that front. I just... the point on the timing of projects spent, when we did that role forward, I was just trying to highlight obviously, we had a bigger upsize in Q3 relative to our mid-point guidance. And I was just trying to help explain why you didn't see more flow through internally, like enhanced results, it just has to do with timing between Q3 and Q4, and as well as some other select thing that we book into the outlook.

Okay. And then FX coming. Does FX effect margins fourth quarter versus third quarter?

From a margin point of view, it's obviously complicated, but the simple answer is FX changes don't really have an impact on margin, because obviously our revenues are impacted that our costs are also impacted as well. So, it's complicated, but the simple answer is that it's not a big margin impact. It does obviously impact the absolute reported levels for the enterprise.

All right. And last question, in your prepared remarks you talked about SG&A growth moderating in the fourth quarter, obviously I remember the higher spent a year ago. So, my question is, is this more anniversary SG&A year-over-year or is there some SG&A management in the fourth quarter, versus the third quarter of this year.

I'll let Bob talk about the cost discipline that we've been putting in place. There is some anniversary benefit as we pointed out, last year we had about $5 million of cost as we closed out the books, we do some final shootouts they'll kind of move to vendor action last year. So we will assuming everything is normal, this year we'll have some favorability. But more significant factor is that we've been quite disciplined in terms of our cost management

From a cultural perspective, Andrew being very careful on our own discretionary expense spending. And that in just in the past few weeks, I've got a couple of projects that I thought we put in place at this timeframe that we're ultimately benefit Iron Mountain, but in near terminal pretty comfortable staying in money and we are being very careful here and adding 00to over head especially in corporate function. We are not offering that production revenue, and our growth capacity in the field, but we have been very careful with all the head growth and we expect that to result in moderated growth in SG&A.

I want to point out one of the factor to you, Andrew, which is a lot of the growth that we saw year-to-date are the biggest driver of our SG&A growth being ahead of revenue growth in the first half of the year, was the integration of technology acquisition. And obviously, we've been disciplined on that front as well this year. We'd be working through those comparisons as fast as we in the fourth quarter and that's also a fact of contributing.

Okay. That sounds good. Thank you so much.

Your next questions comes from Michel Morin with Merrill Lynch

Hi, Michel.

Good morning. I just wanted to double check something on your slide 14, where you rolled forward the guidance. It looks like very good performance in that 20% and $20 million upside to the top line generated, what is essentially a 35% margin. S, could you point out for us kind of where you think that upside has been coming from and why it's generated that much better profitability?

Obviously, a lot of puts and takes in that. I would say in simple terms, we are seeing some benefit from higher margin service growth. I think it's more of a mix of business impact but its complicated Michel. It's not a... there isn't anything underlying the kind of the performance of the business. It's... there is some things at the margins that helps to support that.

Okay. Alright, that's fair. And then could you explain for us a little bit how it is the FX related tax provisions are non-cash and maybe you talked about that in the prepared remarks and I may have missed it?

Yes, well in the near term. It's a FX obviously fluctuates up and down and the tax provisions are related to as we mark our debt to market We have to reflect the changes that occur in high tax... relatively higher tax jurisdiction and lower tax jurisdictions. And, we recorded deferred tax division. So, our debt is six to 10 years out. So, if nothing changed between now and then, there could be a cash impact. But we've seen benefits... what we're seeing this quarter is actually a mirror of the benefits that we saw as the dollar was weakening as foreign currency is over the last couple of years. It just happened to occur all at once, so we had a big impact on the quarter. There could be a realization, but it's going to be tied to the maturation of the debt, which is long-term at six to 10 years.

Alright. And so this kind of impact is something that obviously could repeat itself in the fourth quarter and into '09 if we continue to see this kind of dollar strengthening?

No, I do want to reinforce in the fourth quarter. We anticipate that we're going to have an impact. We're not quantifying it, but post September 30th, there is been a continued substantial appreciation of the dollar. And we don't have our year end rates yet, but if we... if these rates kind of sustain through the end of the year, we're likely going to see that in Q4. It all depends on what happens in the quarter Michel. So, 2009... this is basically which you try to true up, where your debt is at a point in time. So 2009, if the rates stayed where they were we wouldn't have this impacts. It's non-recurring in that sense. But Q4, as we said today, knowing how much the dollar is appreciated, we do anticipate sometime as an impact.

Great. Thanks very much.

You're welcome.

Your next question comes from Scott Schneeberger with Oppenheimer.

Hi, good morning. This is Ella for Scott. First just to follow on the previous discussion, can you just help us understand a bit more on the $60 million on cash charge for on the ForEx impact? I mean your EPS has never been so volatile before. So is it purely because of this ForEx fluctuation we see on the market, or is there any changes on your debt structure or like all your accounting policy? So, just help us to understand a bit more on this?

Yes, it is entirely related to $16 million charges, entirely related to changes in FX during the quarter as we mark our debt to market. And, the reason that is significant in the quarter that there just been record changes in currencies, its unprecedented strengthening of the U.S. dollar. If you... as I mentioned in the response to the last question, we've actually seen benefits on this front going back over last couple of years. They just didn't occur all at once. They kind of burden over a period of time, so that... we expect to see some impact on other income and expense related to foreign currency changes. It is just unusual in this quarter. It has nothing to do with changes in the accounting perspective; it's just related to the FX when we saw.

Okay. And would you consider, since like hygiene, if your continuous to see such big volatile?

We do align our assets and our liabilities in international markets. We would have seen much more significant effect on something like other income expense if we didn't have that in place. And so we do leverage that. There is little we can do other than what we've already got in place which is a natural alignment of expenses and revenues in our business to impact the recorded revenue on the OIBDA FX from accounting point of view, we're not going to be hedge cash flows. And as you know, hedge is really on that front are just sort of a planning tool, just to lay kind of eventual changes in the tax rate. So, we're... we appreciate your patience as we work through some of this volatility. But the dynamics you're seeing are related to some unprecedented movements in currency

Okay. Thanks for that color...

We have to move to the next question, we have a queue here, and we're running over so I'm going to ask we've actually moved to the next question.

Your next questions comes from Franco Turrinelli with William Blair

Hi, Bob and Brian how are you? Bob, this is I think mainly for you, I mean, I'm so interested in thinking through, If we pack out at a couple of these long term impacts on internal growth, so lets back out the fuel surcharge as special projects. What we've got as a business that's basically generating 9% internal growth across every single aspect of the business. And in a sense, I'm sort of struggling to reconcile that with your comment, that you're assuming pressure in market. I mean this is an extremely impressive performance. And I guess what I'm asking here is; where is it really that you think you're seeing this weakness, because I don't think the results reflect much weakness or should we be thinking of the business now having a slight little growth that's significantly higher, in this high single-digit internal growth?

Franco, I think it's more we need to just trying to be very balanced in presenting our expectations; we have very high expectations for the performance. We're not seeing a lot of effect on the business. We do see the pressure our customers are on there. But the point I try to make is we think, we can manage through this and achieve the high expectations that were set for a year end for ourselves. The fact of the matter is, we believe that business is performing well; we can continue to manage strong performance and strong internal growth. But there is pressure on complementary revenue. We just have to meet that pressure by focusing on more short-term return on investment for our customers. And we can do that, but it requires tighter management. I didn't mean to set a lower expectations, we have very high expectations. But there is more pressure than there was just a quarter ago. We think we can respond to it, we think we can manage it and stay on target.

It certainly looks like it. Thanks, Bob.

Thanks, Franco. Thank you.

Your next question comes from David Gold with Sidoti. David Gold - Sidoti & Company: Hi, good morning.

Good morning.

Good morning, David. David Gold - Sidoti & Company: Can you give a little more color on... your comments on the fourth quarter variance. You just alluded to not all of that presumably coming from currency. Can you talk about how much of it is coming from sort of other business factors and, just building on that?

Yes, sure. Now that we try to highlight a few... and this was trying to relating it to what would have been implied in our last outlook. We obviously had a very good Q3. As we went up to add our Q4 outlook there were some... we had anticipate some projects that benefited Q3 result in North America, kind of recurring through to the back half of the year and they heard of it sooner. So we update our forecast for that. Papers moderated, it came down, it's now in the mid 180 range and so we are anticipate... that's actually are going to be a bit lower it was the year before. And so, we updated that outlook and we're also... we highlighted that at I Day David that we're doing the big real state rationalization program in the UK and as part of that we're going to be making some decisions around some buildings and we're going to have dilapidations charges that were going to have incur. So, I was just trying to highlight if you... anticipating a question as to why we're not seeing more flow through from the Q3 and we just had some factors that more on our Q4 outlook a bit. David Gold - Sidoti & Company: Got you. Got you but just curious again... if maybe there's a better way to quantify sort of the difference. How much of it is currency and how much of it is business issue?

Well, we did try to isolate the currency impact for you. So what you are seeing in net, net is you have a non-currency number there. David Gold - Sidoti & Company: Got you. Fair enough. Thank you.

Thanks David.

Your next question comes from John Healey with FTN Midwest.

Good morning, guys.

Thanks John. We'll have to make this the last question everybody.

Question... Just a big-picture question on your financial services customers. Obviously we're seeing some contraction in the number of players in this space. I'm not so much concerned about volumes but I was hoping to get your thoughts on pricing and how you see some of your, assuming your customers kind of combined with one another. What that does to the pricing of that business and if it's meaningful enough to have an impact on margins for you guys?

It will have an impact overtime. Generally with our financial services customers especially the largest ones we have long-term contracts, where to the extent that we have any flexibility that will be exercised over a very long period of time. This is actually an area where I'd spent a lot of time right now, John and the fact that they are under intense cost structure and we can help them by understanding what information that they are... does that some can be disposed of. How they can drive out some cost from the litigation that they're facing right now through our e-discoveries services. And, this is also when we do a lot of transactions day in and day out, we have a lot of people that face the customer on these accounts so that we're be in particularly visible and empathetic with them to really response to their needs to derive cost to equation. So, I hadn't to take to say that net, net it's more upside and downside, because... for obvious reasons relative to the state of the sector. But, definitely we're planning the business and that's how we're managing is that there that we are expecting to drive more upside than any downside factors that come from consolidation et cetera. So, we feel we can do a good job for our costumers there that we do, do a good job and they appreciate the help quite frankly.

Okay, great. And there is just one follow-up question your thoughts on cash flow you talked about internally maybe a little bit more conservative on some of your expenditures any change in terms of higher organic deploying cash flow and then you maybe change in and have some pursuing acquisitions opportunities over there maybe the next 6 to 12 months or so.

We would be in really disciplined in this timeframe. But, we make sure that we understand our opportunities to expand internationally individually and we keep that landscape in mind but right now we're been particularly disciplined for reasons I'm sure you can understand.

Great. Thank you, guys.

Thank you all for joining us on the Q3 earnings call. We'll speak to you in next quarter. Thank you.

Thank you. This concludes today's conference call. You may now disconnect. .