Good day everyone and welcome to our Anixter earnings call. (Operator Instructions) And now at this time for opening remarks and introductions I would like to turn the call over to Mr. Chris Kettmann; please go ahead sir.

Good morning and thank you all for joining us to discuss Anixter’s first quarter 2008 results. By now everyone should have received a copy of the press release which was sent out earlier this morning. If anyone still needs a copy you can either go to Anixter’s website or call Chris Kettmann at 312-553-6716 and I can resend the information. On the line with us today from Anixter’s management are Robert Grubbs, President and CEO; Robert Eck, Executive Vice President and Chief Operating Officer; and Dennis Letham, Senior Vice President of Finance and CFO. After management completes their opening remarks we will open the lines for a Q&A session. Before we begin I want to remind everyone that statements on this conference call including words such as believe, expect, intent, anticipate, contemplate, estimate, plan, should, may or similar expressions are forward-looking statements. They are subject to a number of factors that could cause the company’s actual results to differ materially from what is indicated here. These factors include general economic conditions, technology changes, changes in supply or customer relationship, risks associated with the integration of recently acquired companies, commodity price fluctuations, exchange rate fluctuations and new or changed competitors. Please see the company’s SEC filings for more information. At this point I’ll turn the call over to Dennis.

Thank you Chris. Good morning everyone and thank you joining us. Over the past two or three quarters our shareholders and the analysts who follow us have asked a lot of questions regarding the slowing economy and the extent to which it directly impacts our performance. In response to those questions we have pointed to the diversity and depth of the end markets we serve, the various vertical markets in which our customers operate, the geographic diversity of our business model, and various company-driven growth initiatives as factors mitigating some of the effects of a slowing economy. Details of our first quarter results highlight how the diversity of our business and the success of our growth initiatives did in fact mitigate the effects of the current economic slowdown to a sufficient degree to once again allow us to report double-digit growth in sales, operating income and diluted earnings per share as well as improved operating margins versus the year-ago quarter. Before turning to the actual results I also want to point out that this year’s first quarter was more impacted by holidays than the year-ago quarter. This year the New Year holiday fell on Tuesday affectively costing us two work days at the start of the year versus just one day in 2007. Also the Easter holiday was earlier than typical falling into the first quarter in 2008 as compared to the second quarter in 2007. The most significant impact of the timing of the Easter holiday was in our European and Latin American businesses where in many countries this cost us two days of activity; Good Friday and Easter Monday. Overall we estimate that holiday timing cost us one percentage point of growth in this year’s first quarter. With that overview let’s turn to the actual financial results for…

Thanks you Dennis. Thanks everyone for joining us today. I really want to start by saying that we are pleased with our results for the first quarter in an environment that included economic uncertainty and significant disruption in the credit markets. So turning first to the Enterprise business we experienced good growth in the emerging markets in the first quarter. Our expansion across Latin America and Asia is benefiting from spending by local customers in those markets as well as multi national organizations that are adding to their presence in those areas. The trends that we have seen with growth in those economies as well as adoption of high bandwidth applications and data center expansions continues to drive our growth there. In North America and Europe the Enterprise growth was affected by a challenging comparison to very strong project volume in the first quarter of 2007. Last year we saw more project spending from financial, retail and technology customers than we have experienced this year. Their reduced spending is due in part to softer corporate spending but more significantly related to specific project plans of individual customers. However the day-to-day sales activity along with new customer growth is healthy for the quarter and bookings trended up in the past several weeks. In addition we continue to see migration in customer purchases for its higher bandwidth cabling systems continuing the measured technology upgrade process we have seen over the past several years. Security sales continue to generate very healthy growth and as Dennis noted increased over 30% globally and as well increased over 30% in the US; our most mature security market. Growth rates were higher in Europe than emerging markets as our initiative continues to ramp up there and mature to the level it is at in North America. We…

Your first question comes from Celeste Santangelo - Merrill Lynch

Just some clarification on the comments you made regarding the Enterprise business in North America specifically about the project growth, the lower spending for some individual customers was that just from financials or are you seeing that across other sectors?

Actually Celeste its kind of a mixed bag. There were some changes in financial customers as well as we did see some decline at some retail customers but I think its important to note that while we had a couple of individual customers who spent less money in the first quarter than the same period last year we had other customers in those same vertical markets who spent more money than they did in the prior year. That’s why I said that the decline was really related to specific customer project plans.

Okay and then just a question about the outlook, specifically about Q2, you talk about tougher comps versus the 14% increase last year, how should we think about it? Will it be going back to the historical sequential growth?

I think we should think about it more in line with historical sequential growth Celeste which from Q1 to Q2 has typically implied more of a mid to high single-digit sort of trend.

Okay thank you.

Your next question comes from David Manthey – Robert W. Baird & Co. David Manthey – Robert W. Baird & Co.: I think one of the key concerns that people are having today is that the potential that Anixter is being squeezed between OEMs and customers and I just wanted to clarify on your discussion about price increases, are you saying that the situation is that the OEMs are not passing through pricing therefore you’re not passing through pricing or is it more that the OEMs are passing through pricing but you’re not able to?

No I think David the answer is that because this was some over capacity based on the slowdown in manufacturing of building wire which is a market that we do not generally participate in that excess capacity was then directed towards other products in the factories. The result was that there was greater supply of those products so the manufacturers weren’t pushing through the commodity costs but likewise there was more volume in the market generally of those products that we participate in so that created a little bit of a margin squeeze for us. But as Dennis and I both noted what we’re seeing already in the trends in the second quarter is that we’ve really pushed through that issue and we’re seeing margins up already. David Manthey – Robert W. Baird & Co.: Okay and when you say that you mentioned the pricing actions that you’ve taken is that on the data cabling side – some of the price increases that we’ve been hearing about through the channel in addition to the industrial wire and cable?

David the reference to pricing actions is primarily with respect to our OEM supply business where higher steel and specialty metal prices caused a squeeze against contractual pricing terms to those customers. In those cases you get into a little bit of a timing issue about passing through those commodity price increases under the contract and those price increases are and have started to move through the system. There’s a lag factor in there. David Manthey – Robert W. Baird & Co.: Okay so even with copper up here near $4.00 on the industrial wire and cable side you don’t anticipate that pricing is going to go up?

Yes, we’re starting to see that happen. We’re seeing prices pass through. I think part of this is if you look at the first quarter like we said, we lost a couple of days at the beginning of the quarter, weather in North America and in Canada shut down a lot of projects, you had the building wire market because the housing starts are down so the manufacturers were in a position where they didn’t raise prices as quickly as they normally do. And there was excess [inaudible]. But what we’ve seen happen towards the end of the last quarter beginning of this quarter is price increases coming through, demand picking back up and you’re kind of back into a normal cycle that happens with commodities. We didn’t see that in January and February. It was a short-term anomaly quite frankly that’s very quickly fixing itself. David Manthey – Robert W. Baird & Co.: Okay thank you.

Your next question comes from Ted Wheeler - Buckingham Research Group

I wanted to drill down a little bit on the comments you made about daily bookings picking up in the Enterprise products and I think that they, I guess they were certainly down during the first quarter, is that a bit of a repeat of sort of summer credit crisis when you had a glitch in bookings and then it came back? I mean does it feel like that? What was the trend on the daily bookings during the quarter if you could put some color on that?

I think what we’re seeing Ted is more of a seasonal pattern impact here than it is anything about the credit market issue. The pickup we’re seeing in booking activity reflects what we would consider to be kind of normal sequential month-to-month quarter one to quarter two type of activity unfolding that gives us reason to be optimistic about the pattern for the next quarter or two as opposed to assuming that there is some broader economic issue that’s driving against the growth numbers.

Well would I be correct in thinking that the daily bookings in the Enterprise space did deteriorate pretty sharply, maybe more so than normal during the first quarter?

No, I wouldn’t say that. I think what we saw was a leveling out in our booking level in the first quarter. We didn’t see the type of growth that we normally might have expected and now I think as Dennis says we’re back seeing more of the sequential growth pattern that we would expect from Q1 to Q2.

Really what it seemed like early in the quarter projects were getting taken care of and we saw a little lull in the middle of the quarter and then everything booked – the order input picked up, ordering picked back up and like Bob said we’ve been encouraged by the levels over the last six, seven weeks back to what we hoped was a blip at the beginning of the quarter because of no days, and I think the other thing is like Dennis said, the Easter thing really hurt outside of the United States and this is the first time I ever remember it falling in the first quarter.

The other point to make is that when we talked about the Enterprise business and we talked about those rates you have to remember that as we said the security business is growing at a very high rate that really helps significantly build around that business so as the security business continues growing at a high rate the booking rates on security products grows and as the Enterprise project volume and booking volume picks up and the day-to-day sales are picking up it basically gets us back on the sort of growth trend that we would expect.

It sounded like that’s where you were heading. I guess sort of the same question maybe asked slightly differently, in the comments on the quarter you talked about divergence between customers and product lines and then sort of in your wrap up you’re talking about all geographies and all product lines showing better bookings. Is there a difference here between the conditions in the quarter and the conditions now looking forward or is there some inconsistency there, I guess I wanted to have that reconciled?

I think what we’re really trying to say is that there is an improvement in conditions, that’s exactly what we’re seeing.

Okay and the pricing pickup I guess I’ve heard about some pricing increases on the part of your suppliers, do you think you’d get a little more of a typical reaction or response to the level of copper or whatever it might be going forward than you did in the first quarter?

Yes, we’re seeing behavior that is consistent with the past now and like I said earlier it was just a very short-term early in the year lag and people reacted to it plus it was bouncing all over the place so I think a lot of people were waiting to see where copper was going to settle in and now we’re seeing traditional price increases and having the same affect and this is beginning to pass through and like Dennis and Bob said we’ve already seen improvement in the margin line that comes with that so it was a short-term and right now it looks like we’re in normal kind of trends in the ability to pass through [inaudible] and the manufacturers are passing through the copper prices and they’re going right through to the customer.

Thanks for the detail.

Your next question comes from Jeffrey Beach - Stifel Nicolaus & Company Jeffrey Beach - Stifel Nicolaus & Company: I have a couple of questions; first copper coming late in the fourth quarter and coming into the quarter was volatile declined and then you had the serge, did this volatility I think you referred to that – you’re selling inventories and trying to protect your cost on your inventories, is volatility in copper have some negative impact on gross margins?

I think it definitely does Jeff. I think it impacts gross margin. I think it also impacts customers thinking about timing on transactions as well. When you look at a market that’s all over the place and customers trying to decide is today’s price the real price or is it tomorrow’s price or yesterday’s price that’s real. Jeffrey Beach - Stifel Nicolaus & Company: Were there any meaningful inventory gains or losses in the quarter?

No. Jeffrey Beach - Stifel Nicolaus & Company: Okay, second thing is this initiative to expand into industrial automation you talked about hiring people, was there some negative cost impact in the quarter and if so was it meaningful?

I ran through a whole series of kind of investment things that were going on in the first quarter that included the industrial automation, includes continuing to add to the Electrical Wire and Cable sales team for geographic expansion, continuing to invest in the security initiative and costs associated with expanding our Far East sourcing capabilities for the OEM supply business, those things collectively probably added somewhere in the range of $400,000 to $500,000 year-on-year to expense which then add to that the $550,000 charge for closing that facility in Europe in the first quarter probably accounts for in round numbers about $1 million worth of the year-on-year increase in spending. Jeffrey Beach - Stifel Nicolaus & Company: Okay and you’re up against, you talked about tough comparisons with project activity a year ago, can you quantify in some way in dollars, percentages, something and then talk about the businesses because it sounds like project activity was strong in both Enterprise and maybe industrial a year ago. Can you help us with that comparison?

I think the big kind of macro comparison there Jeff is if you look at a year ago particularly from Q1 to Q2 we saw 14% organic growth and that’s roughly double what we would have expected being more like mid to upper single-digit year-on-year comparisons. So that’s one point of reference there in terms of the activity levels a year ago. I think also if you went back and you looked at year-on-year growth rates quarter by quarter from mid ’06 to mid ’07 in Europe you would have seen a very healthy period of organic growth there coming principally from the ECS business. That in the second half of ’07 as we commented a couple of times particularly in our year-end call had seen a moderating trend back to more historical low growth European outlook. Jeffrey Beach - Stifel Nicolaus & Company: Okay thanks.

Your next question comes from Nat Kellogg - Next Generation Equity Research

Just a couple of questions, I don’t want to sort of beat the Q2 thing into the ground but obviously I think you have correctly sort of tried to temper expectations for the second quarter, but if I look at what you – the flip side is obviously you’ll continue to get some FX gains and then the holiday shift, I mean it sounds like you are basically talking about organic growth for Q2 will probably be below the 8% to 12% guidance that you would like to see on a regular basis, obviously I think that’s probably fair to say.

Only because of the very difficult comparison to the year-ago period. I think when you look at where we come from Q1 and expect to go in Q2 we’re going to see very normal historical patterns but we are comping against the very strong number from Q2 of last year.

Okay and then – but you should get a little bit of the holiday shift should help a little bit but not offset that obviously.

Yes.

Okay, and then just can you talk a little bit about electrical, the wire and cable side, I mean that growth was very strong, obviously that’s not purely increasing the overall market you must be taking some share there but I just wondered if you could help us a little bit, talk a little bit more about what areas have been strong and where maybe you think you’ve taken some share or how that’s breaking down.

Well I think the best way to look at it is that we talked about the 45% growth in Europe in the wire and cable business and that’s a very significant take-share growth for us because really what you’re seeing there is movement into Continental Europe, expansion of our business in the Middle East, so we’re taking a lot of growth in those markets and that’s absolutely some of it in the Middle East would be growth in the market but we’re taking a lot of share in Continental Europe and the Middle East. We’re also using supply chain services in North America and the benefit of those supply chain services – I talked about cable management services in my comments really helps the customer operate at reduced cost on these complicated projects so that does help us in fact gain some share in our more established markets like North America by delivering to customers those products at a lower total cost.

Okay and then so if I’m looking in Europe is it mostly that you are taking share from other distributors or is there some shift from more people buying through distributors manufacturers as you said to try and sort of optimize the supply chain?

I think its coming mostly from other distributors and our ability to use our services to optimize the supply chain. I think when you think about distributors in Europe too you have to remember that there’s a traditional wholesaler market there that operates individual kind of storefront branches, does not offer a lot of services, does not coordinate globally and so that’s really where our supply chain and global footprint become an advantage.

I think its important also to note that even with the good growth we’ve had there sales of electrical wire and cable in Europe was about $66 million so relative to the market size we’re still a very small part of the market and I think we have good opportunities to continue to take share without it being disruptive to the overall market or without causing pricing or margin pressures of any sort whatsoever.

Okay and then on taxes, would you ever give any guidance of what you expect tax rate to be for the next let’s say quarters or full year?

We ended up last year with a full year effective tax rate of around 39%. The thing that creates a lot of volatility in the tax rate is the mix of earnings on a country-by-country basis so obviously each quarter we know what we’ve just earned in that quarter, we have a projection what we think we think we’re going to earn for the balance of the year but what happens is you get in to some of the smaller countries that we’re in that are kind of on the margin of are they in a tax paying position or not a tax paying position – you get a little plus or minus and it causes a fair amount of volatility in the rate. Our current best estimate as reflected in the first quarter numbers is we’re going to run somewhere around 37.5 for the full year of this year but that could change as the year unfolds.

Okay and then on acquisitions, it seems like you have slowed the pace on acquisitions a little bit, just curious what you’re thinking or seeing out there and maybe why they’re looking more or less attractive then they were 12 months ago or so.

I don’t think we’ve slowed the pace of our interest in doing acquisitions, I think there was definitely a period in the market there in the second half of last year that was somewhat analogous to selling homes with credit markets tighter, why would you put your house on the market unless you absolutely had to move. So again we’re looking here primarily at privately owned businesses so why would you put that business on the market for sale unless you absolutely had to because you may not have a full compliment of players looking at the business to expect that maybe some players because of credit issues, may not be at the table now that would have been there six months before. I think that was a definite factor in the second half of ’07. I think as we look at ’08 a couple of things to think about; one is due to the tight credit markets actually put some of these businesses that might be interesting to us in a position where they themselves have credit issues that causes them to think about a sale. Or two, as you look a little further down the road are there issues about the tax landscape that could potentially change that causes people to think hey I’m better off giving up half a point or a point of multiple today at today’s tax rates than waiting the year or so at a different – possibly different tax regime.

I appreciate the time.

Your next question is from the line of David Heller – Delaware Street Capital David Heller – Delaware Street Capital: With the obvious disconnect here between the growth rate and the stock’s PE currently I think a lot of people are looking back towards the performance earlier in the decade, can you give us a little more comfort on why you don’t expect the margin pressures we saw back then and also you’ve alluded to this already the difference in the sales mix but any additional color would be helpful as well.

Sure let’s go back and put the beginning of the decade recession in perspective, a couple of things; first off we were coming off a period beginning in the late 90s early part of the this decade where a combination of Y2K related spending and then the initial phases of e-business investment caused there to be a very heated enterprise cabling marketplace almost to the point that it was irrational exuberance to some degree. When we got into the recession then what happened was the pendulum kind of swung 180 degrees and after a period of several years of almost uncontrolled spending it was like CFOs grabbed control of the IT budgets and unless something was broken nothing got spent. I don’t think we’re anywhere near that sort of environment today. It’s our sense that they type of project activity and the levels of project activity we’ve seen over the last couple of years had been driven much more by thoughtful strategic rational investment by the customer base so I don’t see us swinging from the sort of bubble to the other extreme type of thing. The other thing that’s important back in that time period from a mix standpoint is in 2000 we had about $0.50 billion worth of sales to alternate Telcos. After that market collapsed in ’01 those sales for ’01 dropped to $150 million the biggest part of which was in the first half of the year and effectively by the end of ’01 we were out of that market. There’s not such concentration issue in the business today. As I said at the beginning of my remarks I think one of the great things about the model today really is the diversity of end markets serve the diversity of vertical markets that our customers are in – the geographic diversity which I think overall puts the model on much firmer footing then that mix that we had at the beginning of the decade. So I think those two things argue for a much different outlook for softer economic conditions now then what we saw at the beginning of the decade. David Heller – Delaware Street Capital: And on the margin side can you talk about the health in the supply base and where you think we are in terms of some of this building wire capacity working its way into your end markets?

It’s rationalizing itself somewhat as the big projects have picked back up. I mean really in North America – I think one of the things we underestimated was the weather conditions shut down a number of big projects during the quarter which just added to the issue and now that those are starting to flow through you’re starting to see those projects pick up, you’re seeing a much more rational pricing environment. David Heller – Delaware Street Capital: Thank you very much.

Your next question is a follow-up from Ted Wheeler - Buckingham Research Group

Just one follow-up if I could, in terms of looking at the sequential issue we’ve talked about I think if I took the first quarter at 7% growth and put the point of holiday back on it and then from that level maybe cut in half the sequential performance of last year, wouldn’t that be a decent way to approach the June quarter’s outlook?

So you’re talking about roughly 7% sequential growth from Q1 to Q2, is that --?

Yes, adjusting the first quarter for the holiday negative, adding back some sales to the first quarter to reflect that which you commented on.

Yes, that’s probably fair.

It sounds it, I just wanted to bounce it off you and I appreciate it.

Gentlemen it does appear there are no further questions in the queue.

At this point I’ll close the call. I want to thank everyone first for taking the time to join us on the call today. As we reflect back on the first quarter we are pleased that we achieved good sales growth in a challenging economic environment compounded by the timing of a longer New Year’s holiday and the early Easter holidays as we’ve talked about. We’re also encouraged by our continued progress on our initiatives that added to our overall growth. We think the trends in security, supply chain and globalization all present great opportunities for us. The ability to expand the product mix sold to existing and new customers will further present growth for us through the balance of the year. The improved operating leverage over last year while investing for future growth shows good discipline in managing expenses which positions us well in the current environment. We are off to a positive start in Q2 and we expect both sequential and year-over-year growth during the quarter. We appreciate your support and look forward to speaking with you after this quarter closes. Thank you.