Good morning. My name is Tim, and I will be your conference operator today. At this time I would like to welcome everyone for the EnPro Industries first quarter 2009 results conference call. (Operator Instructions). Mr. Washington, you may begin your conference.

Good morning everyone and welcome to EnPro Industry’s quarterly earnings conference call. Steve MacAdam, our President and CEO, and Bill Dries, our Senior Vice President and CFO, are here to review the events of the first quarter of 2009 and our financial results for the quarter. They will also discuss current conditions in our markets and how those affect our expectations for the remainder of this year. Following their comments, as usual, we’ll open the line for a question-and-answer session. In addition to Steve and Bill, Rick Magee, our General Counsel, is also here if there are any questions directed for him. Before Steve and Bill make their prepared remarks I’d like to remind you that you may hear statements during the course of this call that express the belief, expectation, or intention, as well as those that are not historical facts. These statements are forward looking and involve a number of risk and uncertainties that may cause actual results and events to differ materially from such forward-looking statements. These risks and uncertainties are referenced in the Safe Harbor statement included in our press release and are described in more detail along with other risks and uncertainties in our filings with the SEC including the Form 10-K for the year ended December 31st, 2008. We do not undertake to update any forward-looking statements made on this conference call to reflect any changes in management’s expectations or any change in assumptions or circumstances on which such statements are based. This call is also being webcast on enproindustries.com and a replay of the call will be available on the website later today. If your questions are not answered on the call or if you have any followup questions, you can contact me later at (704) 731-1527, and now, I will turn the call over to Steve.

Good morning everyone. Thanks for joining us today. I hope you have all had a chance to review our first quarter results; clearly they were disappointing. Many of our end markets deteriorated very quickly through the quarter, which resulted in sharply falling volumes, which in turn put pressure on profits and margins. The deterioration was not only because of reduced primary demand, but also because of substantial de-stocking of inventories by our customers. We are operating in a difficult environment, but we are comfortable on our direction and we are enthusiastic about our future. Our near-term objective is to deal with this environment in a realistic and decisive manner that strikes a balance between the need to control cost and the opportunity to invest for the future. Controlling cost is critical and we are addressing the issue head-on. We’ve reduced employment levels by approximately 8% from the end of last year and by nearly 10% from the peak in the middle of 2008. We’ve shortened work weeks, frozen salaries, and reduced discretionary spending. We continue to monitor conditions closely and we are prepared to take additional steps should we determinate if they are necessary. We are fortunate to have a group of very experienced and capable managers who are driving our efforts to control and reduce our cost and we are fortunate to already have the benefit of the productivity and efficiency programs that we’ve implemented over the past several years and that are continuing. Although we are aggressively reducing and controlling cost, we are also prepared to invest where appropriate to assure we can take advantage of opportunities to grow. In the current economy, we expect to encounter many opportunities to use our leading market positions and healthy balance sheet to create an even stronger company. In this vein…

The weak market conditions that we began to encounter late in 2008 continued into the first quarter of 2009, and as Steve mentioned, our sales dropped 24% from the first quarter of last year to $216 million. Six points of the drop came from unfavorable foreign exchange rates. On the positive side, acquisitions made a 2% contribution. Gross margins were 33.7% in the first quarter of this year, almost 3 full points below last year. The decline in volume in the engineered products segment drove the change. Both the sealing products and engine products and services segments recorded an increase in gross profit margins. Total SG&A spending was down from the first quarter of last year although as a percent of sales it increased by 6% points to 29.1%. As Steve indicated, we are paying peculiar attention to these expenses and have taken steps to control and reduce spending. Many of these actions were implemented in stages over the course of the first quarter. We will see their full benefit later in the year when we realize about $2.5 million of the benefit in the first quarter. On the other hand, we’ve made a conscious decision in a number of cases and maintained spending for sales and marketing and for product development in order to support our goals for gaining market share and to ensure that we are in a strong position when markets begin to recover. After expenses we reported an operating loss of $5.5 million compared to income of $24.7 million last year. Our tax benefit in the quarter was $11.7 million which exceeded our pre-tax loss of $8.5 million. Our tax rate reflected the benefit of structural and organizational changes we put in place late last year and we will continue to benefit from them going forward.…

The first quarter was clearly a challenge, but as you are well aware we are not alone. Nearly all parts of our economy are struggling and many companies have encountered similar or even worst conditions. Nevertheless, our goals for EnPro and its future have not changed. We will continue to meet the challenge quickly and decisively and we will remain focused on what we believe is a very bright future. A month into the second quarter conditions are very similar to those we experienced in the first quarter. We don’t see any evidence of further deterioration in our markets, which is an encouraging time, and as Bill indicated, customers should begin to stabilize the inventories and volume should pick up even if the improvement is slight. Although it’s too early to say, if this has begun in any meaningful way it could provide some benefit to our results later in the year. Industry forecasts for 2009 indicate economic activity will remain significantly below last year’s level. In some of our markets, that is likely to mean a decline of 30% or more and in many cases the decline is greater than we anticipated in February when we last updated you on our outlook. The consensus of the forecasts across the industries that we serve suggests that overall activity in our markets will be 18% to 20% below the full year of 2008. We have already adjusted our cost for these conditions, and we will take additional steps if necessary and if future conditions warrant. The benefits of lower employment levels, shorter work weeks, salary freezes, and cuts in discretionary spending, should become increasingly apparent over the course of the rest of the year. In addition, we are beginning to benefit from a sourcing initiative we have implemented to control material…

(Operator Instructions). Your first question comes from Joseph Mondillo - Sidoti & Co. Joseph Mondillo - Sidoti & Co.: First, I just want to start on the restructuring; could you just go into a little more detail on how much restructuring was realized in the first quarter, how much you expect to realize going forward such as the second quarter and further, and you mentioned it’s going to be saving about $30 million annually by year-end, is that correct?

Yes, that’s not only as the result Joe, just a restructuring; that’s basically all inclusive of the cost reduction efforts that we put in place, and the reason the restructuring is lower than what we said in the last call, the restructuring number frankly, is that we have decided to not implement as aggressive steps in France as we were originally anticipating because the cost of negotiating social plans in France proved to be prohibitive. So we are going with an alternative approach that won’t require as much restructuring expense.

We’ve total restructuring charges of about $2 million in the first quarter, and as Steve mentioned in his report, we currently estimate something in the neighborhood of $5 million, and the balance of that will be pretty well spread throughout the balance of the year pretty evenly. Joseph Mondillo - Sidoti & Co.: You’re expecting to realize $30 million by year-end; so most of that will be realized in 2010 or can we expect some to be realized in 2009 as well?

Certainly, yes; and many of the actions have been implemented and will continue to be implemented; the $30 million is an annualized run rate. Joseph Mondillo - Sidoti & Co.: In regards to pension expenses which you talked about on the call, the last call; could you give some detail on how that affected the quarter and how that’s going to be affecting going forward?

On the last call we had indicated that we had anticipated our pension expense for the year would about triple. Our pension expense last year was in the neighborhood of $5 million or thereabouts, and we were expecting it to be closer to the $15 million this year, and that’s about what we saw in the first quarter; our total pension expense for the quarter was a little over $4 million and that compared about $1.5 million last year. Joseph Mondillo - Sidoti & Co.: So, you still expect $15 million for the year?

Yes. Joseph Mondillo - Sidoti & Co.: Steve, maybe you could talk about the engine business, just trying to get a little more visibility on what you guys are seeing; I know it’s a lumpy business quarter to quarter, but maybe you can talk about what you are seeing for this year as a whole, and I know it’s a long-term business, so I don’t know if you can talk about 2010 at all there too?

As we’ve indicated before in the call, the backlog there is pretty long; we don’t have a ton of visibility into 2010, but we’ve got good visibility through 2009. Our backlog has remained relatively flat from where it was at the end of the year. So, we haven’t seen any decrease there so far. The aftermarket and service portion of that business is healthy and the new engine shipment schedule this year should be fairly consistent with last year in total. So, we anticipate year-over-year improvements in Fairbanks from last year. Joseph Mondillo - Sidoti & Co.: Do you have the backlog number at year-end ’08 compared to year-end ’07; do you happen to have that; for the engine business?

The total backlog was about flat at the end of the year, was about $260 million, and the engine business was about $170 million of that; so, it’s about two-thirds of the total company backlog and that’s up about 7% or 8% from the end of the year, to now. Joseph Mondillo - Sidoti & Co.: What about year-end ’07; do you have that?

No, I don’t have that readily available. My recollection is that it’s in that neighborhood though, and maybe a little lower; we are not looking at that now Joe. You can follow up with Don if you want and he can provide that.

Your next question comes from Gary Farber - C.L. King & Associates. Gary Farber - CL King & Associates: I just had a couple of questions. On this inventory de-stocking, are you saying that it has run its course or would you expect it to continue for another quarter or two?

No. I think Gary, our sense obviously varies across the different end-use segments, but our sense is it has pretty much run its course. In fact we’ve actually seen in some pockets around the world some reordering levels that we did not experience in Q1. Gary Farber - CL King & Associates: Can you say in what areas, what type of end markets?

We’ve seen some auto business return in Brazil and in Europe where orders were very, very slow in Q1 into GGB, that would be the one I would mention; and we’ve also seen the aftermarket in the trailer business for seals out of Stemco has stabilized as well and we don’t continue to see that declining now. Again I don’t want to indicate that we are anticipating some kind of sharp rebound in volumes, that’s not the case, but we have seen at least some glimmer of hope that the rate of decline is decreasing; we flattened out in some cases and in some cases actually seen reordering that we haven’t experienced for three or four months. So, that’s why we feel like it has more or less run its course. Gary Farber - CL King & Associates: In Europe, I don’t know if you give it out in the Q at all, but is it possible to quantify year-over-year revenue for your company as a whole; how much revenue was down in Europe?

I don’t have the number at hand. Obviously GGB is primarily European, it derives about two-thirds of its sales from Europe and its total revenues are down half of what they were a year ago, but I don’t have the European-America split. Gary Farber - CL King & Associates: Using like say a baseball analogy, can you talk about what inning you are in if you think of the downturn there in Europe and just broadly for your businesses?

You are speaking specifically of Europe, Gary? Gary Farber - CL King & Associates: Yes.

It’s tough to say. As you know, we had six straight months of sequential greater than 2% GDP decline right on top of each other in Europe. So Europe went down very, very dramatically. So if you put a gun to my head, I’d say we are probably in the fourth inning may be; Bill, what’s your view?

I think I’d play it safe; I think that’s probably a pretty good assessment. Gary Farber - CL King & Associates: Then lastly just on the trucking business, you are saying that it’s still weak. I know it seemed like for a while it was just sort of riding the bottom; is it getting weaker than the bottom or still riding the bottom?

I think it’s still riding the bottom. It did weaken a little bit in Q1 particularly the trailer bill. The aftermarket continues to be obviously more stable and revenue miles are forecast to be down about 11% from two years ago, from ’07. Those are not our forecasts, those are public forecasts, but our OEM businesses is down substantially out of Stemco, but as you know the lion share of that business is aftermarket for us anyway. Our market share in aftermarket is much higher than OEM. Gary Farber - CL King & Associates: So, you would say on OEM the trucking, it may have been a little bit worse in the previous bottom, but not that much worse; is that a fair way to look at it?

You mean than where we were. Trucking at its bottom was a historical low and we have now broken that. Gary Farber - CL King & Associates: Okay, and that’s on the OEM side or the aftermarket side?

The OEM side. Gary Farber - CL King & Associates: So you have sort of reached a second leg down on the trucking market, you are saying?

Yes, I mean just to give you a feel; I don’t have all the numbers right in front of me. So don’t hold to me it to, but in general perspective when the new trailers and these are trailers and not trucks; trailers is in the lion share of what we sell into. New trailers that were built at the peak of this cycle which is probably 2006, there were over 250,000 built, and the industry forecasters are basically saying this year it’s going to about 70,000 built. I would say a mid-cycle number would look more like 160,000 to 180,000 or in that neighborhood. We are well less than half even a mid-cycle number. So, we are pretty comfortable that’s the bottom. Gary Farber - C.L. King & Associates: Then just lastly on this $30 million savings program, that’s savings that will come out of both the cost of goods sold and SG&A or our side?

That’s correct. Gary Farber - CL King & Associates: And that’s what you can think about for fiscal ’10 as far being the opportunity really?

The ingoing run rate, I would say.

Your next question comes from Todd Vencil - Davenport & Co. Todd Vencil - Davenport & Co.: When you think about your margins, you didn’t mention it; so it’s probably okay, but how is your price cost relationship in the quarter, is that kind of where you want it to be? I mean not in terms of your fixed cost, but in terms of your input.

Yes. In terms of the input we look pretty much okay. We may have been slightly negative, but I don’t think it was meaningful. Obviously the downward leveraging at a volume would cost us significantly, but in terms of the input and our pricing, there was not a significant difference; so, I think we pretty well kept pace. Todd Vencil - Davenport & Co.: So, is it fair to say that pretty much all the incline you are seeing in the margins, either year-over-year and where the normalize level ought to be, was just due to that under loading you picked off?

Yes. No question about it. Todd Vencil - Davenport & Co.: Of that $30 million that you are going to save, how much of that comes back when things pick up again or do you got to keep all those savings?

A fair bit of that savings obviously is direct labor cost. So, you shouldn’t be thinking about it that that stays out when volumes return.

It’s probably three quarters of that number, Todd, are headcount related, and as Steve said, a good chunk of that is our direct labor. So, as volumes start to return we’d presumably be bringing those people back. Todd Vencil - Davenport & Co.: So, maybe you are bringing in the other quarter maybe $7.5 million is sort of structural from the restructure?

Yes, but again those would be more SG&A costs and engineering costs and stuff like that, but we would probably bring back at some point. Obviously we are operating a lot of pretty strong markets in early ’08 and ’07. Todd Vencil - Davenport & Co.: Final question from me; thinking about opportunity, I should say, you mentioned that and you have been mentioning it; can you give us a little color on how you’d think the opportunity set out there that you are looking at for acquisitions or growth; is it changing, is it improving, what are the opportunities you look like it for in, what should we expect from you guys in terms of timing on any actions; if you can even think about that?

Yes, I would say we feel opportunities increasing. We have continued to maintain our program of building the pipeline and trying to identify strategic acquisitions. We’ve been quite successful. We have a bunch that is lined up in the pipeline and the challenge to us now is managing the timing of those. Many of those as we’ve said before are not active processes to sell there where we are essentially the only person and they are talking to the target, and so many time they can be deferred without us risking losing it or risking having someone else’s volume. So, we are trying to manage that; we don’t want to fundamentally affect our pretty nice liquidity position today until we do feel and see a little bit more visibility into the future. So, we’re being a little bit cautious. We are exploring alternative ways to do deals and continue to grow. You may have seen the recent press release we had with a Brazilian brake friction company for commercial trucks called Duroline. We’ve entered a partnership with them to be their exclusive agent selling that product in North America; we are very excited about that, but that’s an example of a growth lever that we pulled with our Stemco business that not hugely capital intensive on our part. So, we are starting to explore other alternatives, I would say to continue to grow without our traditional straight acquisition in order to preserve capital. So I think the expectation should be throughout the year that we would continue to moderately invest in small tuck-in deals that make sense strategically, but I don’t think you will see us doing anything that fundamentally changes our strong liquidity position. Bill, would you add anything to that summary.

No, I don’t think. That’s a good summary.

Your next question is from Gregory Macosko - Lord Abbett.

Could you just talk about your asbestos situation, the number was I guess basically flat. How do you stand with the insurance companies and what should our expectations be on a longer term basis, running through to the future?

Rick Magee, the General Counsel or the person responsible in our company for asbestos, is actually here with us to help us with the asbestos questions. So, I am going to let him comment on that and then I may jump in at the end. So, Rick why don’t you take a stab at that?

Several quarters ago we began disclosing in our quarterly reports the remaining insurance a year in which we expect to correct it. So not only do we lay out our total remaining insurance, but we lay out a math of how we expect to collect that remaining insurance over the next decade, and so that’s pretty clear. Our insurance arrangements are in place, there are no disputes about the amounts. We feel good about our insurance carriers and keep our eye on that and their ability to pay. So, the insurance side we feel like we have got a pretty good handle on it, but as you see from those numbers that’s a declining number and we’ll collect significantly less insurance this year than we did last year, about the same amount next year, and then there is another decline as we run through the remaining insurance. So, our challenge is to continue as we have the lower the total cost for asbestos so that we can try to keep pace with our net outflows and not have a significant up-tick there. We will probably experience some years when we have an up-tick where the insurance falls off significantly, but our goal is to continue to have the outflows that you’ve been seeing over the last several years to be fairly stable over time and not to have a dramatic increase in the net outflows for asbestos. It’s a challenge and it’s uncertain out there. We’re in the courtroom a lot, but we are confident that things are going.

Your next question is from Rob Young - William Smith & Co. Rob Young - William Smith & Co.: Just a quick question regarding the possible incremental impacts of auto manufacturers going bankrupt; is that going to have a significant impact or is basically the incremental change fairly neutral?

Likely, I think it’s fairly neutral Rob. We supply obviously to tier 1, tier 2 level suppliers, not directly to the ordering folks. Everybody has been well aware of the stress in the supply chain. We’ve been able to manage our receivables accordingly and appropriately as I think everybody in this supply chain has, and quite frankly, I think that the industry has already curtailed so much capacity, I don’t think the bankruptcy process will really materially impact, it might in a few spotted areas if both GM and Chrysler file, and we may have some bad debts out there, but in terms of actual ongoing volumes, it doesn’t, but even there it’s not a huge number, we’ve looked at that and I don’t think our exposure is dramatic. Rob Young - William Smith & Co.: So would it be fair to say that from an auto perspective, the volume in that particular application or that particular end market is basically a bottoming phase right now?

I don’t think there is any question about it; I think it has to be. Obviously, as you know, everybody who plays in any industrial space knows there was a ton of inventory washed out of that supply chain from October through the end of the first quarter. Basically, the plant shut down, it took a hugely extended downtime. Many of the European auto plants were down for the entire month of December and then into January. So I think that industry has been very focused on trying to lean out that supply change. So, yes, I think we are in a bottoming phase there as well, that’s my sense. Now, I am not an auto expert by any stretch and keep in mind auto sales is only 8% of our total company sale of which almost all goes through GGB; that’s why GGB has been so affected by this dramatic downturn. Rob Young - William Smith & Co.: I noticed you talked about some possible lower level acquisitions that don’t seem to be as capital intensive; can you talk a little bit about the specific markets that you maybe going into, the markets that you may see throughout the rest of this year as well as going into 2010?

From an acquisition perspective? Rob Young - William Smith & Co.: Yes.

We still have goals of trying to grow the sealing products segment. Garlock has a wonderful worldwide footprint and strong brand name and is really the leading static seal company in the world and is recognized as such. We would like to grow in India; we would like to grow in the UK and in Europe. There is a bunch of add-on product lines and technologies that we’ve got our eye on in that business. Stemco is another business that we’ve got that we like I mentioned with the friction company that we just did the alliance. We did as you know the Kaiser acquisition, Kaiser Engineering, about a year ago for king pins for commercial vehicles, and that acquisition is going extremely well and fit in. So that’s another area we would like to grow, and we still feel very positive about our compressor products international business and growing that; we are one of the leading players in the aftermarket there, and although in the near term. There is not as much demand for energy as the worldwide economy slows down, we still think that natural gas excavation and exploration and transmission and whatnot is a good market for us to be in. So, those are the areas where we are particularly focused? Rob Young - William Smith & Co.: So, are you recognizing that the spread between what you are willing to pay and what the seller is willing to sell, that spread for the M&A market, is that kind of contracting and hopefully will improve throughout the rest of this year; is that what you are feeling?

Yes.

That concludes today’s Q&A session. I’ll now turn the call back over to Mr. Washington.

We thank you all for joining us today, and as I said earlier, if you have any further questions or your questions did not get answered, please call me at (704) 731-1527.

This concludes today’s conference call. You may now disconnect.