Good day everyone. Welcome to our Anixter’s third quarter earnings call. Today’s call is being recorded. At this time for opening remarks and introductions I would like to turn the call over to Mr. Chris Kettman. Please go ahead, Mr. Kettman.

Thank you. Good morning, everyone, and thank you for joining us today to discuss Anixter’s third 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 today from Anixter’s management team are Bob Eck, President and CEO; and Dennis Letham, Chief Financial Officer. 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, intend, 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 a 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 will turn the call over to Dennis.

Thanks, Chris. Good morning and thank you for joining us. Let me begin by broadly commenting on the overall business pattern that evolved in the third quarter. The quarter began on a very solid note with July being a record four-week month. Typically we see a slowdown in sales from July to August as vacations, particularly in Europe, effect activity levels and many of our OEM supply customers have factory shutdowns for scheduled maintenance, model year tooling changes or vacations. This year the August slowdown was slightly more pronounced than historical patterns. However, the real issue in the quarter was the normal bounce back in sales activity from August to September was much weaker than historical patterns would indicate. While this was generally true throughout most of the business, it was most pronounced in Europe and within our OEM supply customers where we saw either extended shutdowns or reduced production schedules once business resumed after the August shutdowns. While the effect of this was a further deceleration of the sales growth rates, we still managed to generate 4% sales growth during the quarter versus the prior year. Equally important is the fact that after adjusting for acquisitions and a small amount of positive foreign currency translation impact, we had positive organic growth of approximately 2% during the period. Although this was the lowest year-on-year growth rate we reported in a number of years, we are pleased that it remained positive despite an increasingly challenging global economic environment. Despite this slower sales growth and some additional margin pressure that I will discuss in a few moments, we were still able to leverage good expense management to generate operating margins of 7.4% during the quarter. This operating margin compares favorably to the record annual operating margin of 7.5% we generated in 2007…

Thanks Dennis and thanks everyone for joining us today. As Dennis has just described, after a solid start to the quarter in July we experience a noticeable slowing in growth, which combined with the rapid strengthening in U.S. dollar and gross margin pressure, contributed to essentially flat operating earnings versus the prior year 3rd quarter. However, given these challenges, we still reported positive organic sales growth versus the year ago quarter. I am also pleased that we were able to control operating expenses while supporting our initiatives and completing three acquisitions that continue our strategy to expand the OEM supply and electrical wiring cable businesses. The enterprise cabling and security solutions business experienced low growth in North America, as project spending was weak. While we entered the quarter with market surveys projecting growth in IT spending, we exited the quarter with new surveys reporting a decline in IT spending this year. This rapid change in outlook is reflected in the enterprise sales numbers. At this time, our view is that given deterioration in the credit markets and the economy as a whole, corporate spending has slowed or declined for discretionary items, including certain information technology projects. This conservative approach to IT spending appears to be in place in North America and Europe. Our Asia Pacific business also saw the effect in the third quarter of reduced spending by Western multinationals in their Asian operation. Our Latin American business, however, experienced solid growth as the economics, particularly in South America, appear to be less affected by the broader economic slowdown that is impacting spending elsewhere. While we have been very cautious to properly manage our volume-related expenses, we have continued to build our security team to take advantage of the two trends we have been seeing in that market. First, expanded…

Thank you, Mr. Eck. The question and answer session will be conducted electronically. (Operator Instructions.) We take our first question from Celeste Santangelo with Merrill Lynch. Celeste Santangelo – Merrill Lynch: Good morning. Just a question on the outlook, you walked through some of the puts and takes for the top line growth, are you looking at top line growth of maybe 5 to 6% now, given the acquisitions and then the three extra days? Am I looking at that correctly?

Well, basically what we are saying is that the acquisitions will offset the normal seasonal softness so if you go in and you take the current run rate, kind of a 23 - $24 million a day rate, pick up the three extra days, I haven’t done the math on that but that would imply unless there’s further softness in the quarter that you could pick up 50 to $60 million sequentially. The thing I would say is we look at how the fourth quarter has started is so far through the first three weeks of October, the sales run rates are pretty much mirroring what we saw in September. The real wild card in the quarter will be what happens at the holidays. The experience of the last several holidays going back to the end of last year with the Christmas and New Year’s holiday were that holidays have tended to be much quieter than what they have been historically and including the surrounding days so I think the real issue is what’s the holiday impact that we’ll see later in the quarter? But just on math you could get to a number where you pick up $50 - $60 million dollars or more in revenue Q3 to Q4. But keep in mind there is a full week of expenses that comes with that three days of revenue so it will help the top line but it doesn’t necessarily do anything for the operating profit line.

I think Celeste, to pick up on Dennis’ point, one of the things that is happening with holidays that I think has changed are revenue numbers around holidays from a historical trend is the shift in our revenue mix towards the OEM supply business over time. You know, if you look back a number of years ago we didn’t have that business at all. As that’s become a bigger part of the revenue mix, what we tend to see are factory shutdowns around the holidays that have a bigger impact than say maintenance or construction kind of projects that tend to flow during the holiday season. You know, you see in the OEM business a plant shut down for a week between Christmas and New Year’s where contractors would tend to work some of the time between Christmas and New Year’s and I think that contributes to our caution around what we will see at the holidays. Celeste Santangelo – Merrill Lynch: Okay and you provided some detail on the rapid change and the outlook for the enterprise projects from the beginning of Q3 to the end of Q3. I know we are only three weeks into the quarter but are there any significant changes to that outlook? I mean, Dennis your point just was that the first three weeks kind of seem in line to what was going on exiting Q3 but I guess if we could just focus on the Enterprise projects.

You know, Celeste, there's actually no change in the trend in October that we can point to. Celeste Santangelo – Merrill Lynch:

(Operator Instructions) We go next to Jeff Beach with Stifel Nicolaus. Jeff Beach – Stifel, Nicolaus & Company, Inc.: Yes, good morning.

Morning, Jeff. Jeff Beach – Stifel, Nicolaus & Company, Inc.: I'd like you to discuss a little bit the impact of copper on your operations going forward. If copper would remain at this level, let's say for the next 12 months, are you facing the potential of some inventory losses or is pricing coming down and your turns at rate that you can avoid taking a loss in inventories to get your levels in line with where copper is right now?

I guess a couple of things on that. There is really the inventory question that you lay out very clearly. There is kind of the run rate impact of lower copper prices, too, that goes hand in hand with that. I think with respect to the inventory position there is no question there is some exposure there but I think the positive side of that is because the prices have come down relatively quickly, I would say the industry in general in terms of the distribution channel is probably all sitting there with some overpriced inventory and as a result of that I think that will mitigate how quickly actual market prices come down and serve as a bit of a buffer there until we cycle through a turn of inventory.

And to pick up on Dennis' point, another important point about our Wire and Cable inventory is some of the inventory is committed to projects under non-cancelable, non-returnable purchase orders. So that inventory, while it may be higher-priced than the current cost of copper, effectively is out of risk.

So that's kind of, there's no question there is some inventory risk there but we don't view that as being a significant item and if it is it will happen in the course of roughly a quarter because the inventory turns in round numbers four times a year. So I don't view that as being a big issue. I think the more important issue, probably, is if copper settles around this low $2 price range versus the kind of $3.40 range it's been at in the last couple of years, that probably implies in the range of $100 million or so less in run-rate revenue in the business and of course if margins are held at around 24 points that implies about $24 million less of gross margin. And I mean, there's nothing different about that story than what we've been telling you for the last three years when copper had jumped from '05 to '06 and we're just basically confirming what the message that we've had out there for a couple of years on that point. Jeff Beach – Stifel, Nicolaus & Company, Inc.: Alright, thanks. Just as a follow-up, the decline in Asia-Pacific was a little bit surprising. Is that something where you see continued year-over-year declines in sales or do you think there's something specific about that region and you'd look for a little better results ahead?

I think the quick answer is that it is going to be a little bit challenged just like Europe and North America enterprises are right now. Our customer base there is substantially Western multinationals so they're really spending money in that region somewhat differently from the trend we see in North America and Europe. In other words there is investment in expanding business that are going on with a number of customers there. They still tend to have some project volume flowing. But we are also seeing some of the same slowdown. I think one of the things that large corporations tend to be pretty good at when their outlook changes is tightening up on spending on projects that they believe they can defer until better times. And so we're seeing some of that tightening. I think we'll be challenged in Asia-Pacific in the next quarter and really probably until we start to see some pick-up in the broader economy. Jeff Beach – Stifel, Nicolaus & Company, Inc.: Alright, thank you.

We go next to Kyle O'Meara with Robert W. Baird Kyle O'Meara – Robert W. Baird & Company, Inc.: Hi, good morning. I guess could you just discuss the factors that impacted the company the last recession versus this go-around, if we are in a recession, and the pros and cons there? and then just as a follow-up to that, similarities and differences in what you're seeing today versus '01 or a different slowdown, maybe perhaps at the early '90s would be more applicable. Thanks.

Okay, Kyle. I'll start and Dennis will jump in. The first thing that I think has to be highlighted is that the recession was led last time around really by a sudden fall-off in the whole dotcom C/LECT sort of market. There was overbuilding or overspending on infrastructure in that marketspace. At that point in time we had built roughly a half a billion revenue dedicated to that market segment. When that spending sharply declined in 2001, and I think we’re all familiar with a wave of bankruptcies among the IXCs and alternative carriers, that business went from a half a billion dollars in 2000 to $150 million in revenue in 2001, so a very sudden fall-off, but initially pretty focused in that specific sector in a company as Anixter that was much more focused on enterprise in the communication markets and percent of sales mix, and also much more U.S. dependent. So if you look today, you’ve got a different mix in terms of a much larger electrical and electronic wire and cable business, which as we have seen is really running on different fundamentals. It is running on resource investment, mineral development, oil/gas/petrochemical development projects. so that is running on different fundamentals than we saw the last time around, and right now, even with oil at the kind of $70-a-barrel range, the projects we are engaged in are highly economically beneficial at that kind of an oil price. So I think those dynamics in the electrical wire and cable business are a bit different. In addition we have greater geographic spread, which has pros and cons. I mean, the coverage in western Europe right now is creating a little bit of drag particularly in the enterprise space; on the other hand, the presence in western Europe and the Middle East in the electrical wire and cable business, which was much smaller in the last recession, is creating an off-set to the drag that we are seeing in the enterprise business. The OEM –

I think, Bob, just on that point of geographic coverage, too, the other important thing is if we look back to the beginning of this decade in that recession, in our emerging market businesses we really did not have operational critical mass at that point in time. We would have a red quarter, a black quarter, because we were kind of hovering around the break-even point and the recession parked us solidly in the red for a period of time. Today we’ve got, you know, good critical mass in those operations. They are running with operating margins around the corporate average in the mid-sevens, so I think we have got a much different operating leverage story on some of the international business today than we did six, seven years ago.

Yeah, and I think that the OEM supply business, while it creates exposure to some cyclical manufacturing, it also has exposure to aerospace, which right now is at a very high end of the cycle, so you know, you mix all that stuff together and I guess the quick answer is you have a different company than you had in 2001-2002. In a lot of respects I would say we will be therefore impacted differently this time around than we were in the last go-around. Kyle O'Meara – Robert W. Baird & Company, Inc.: Okay, thanks. And I guess what – you know, in the event that we are, you know, in a recession, what levers do you guys have available to pull to scale back operating expenses, that sort of thing, in the event of a slow-down?

The key lever and the quickest lever is expense related to people. People-related expenses make up roughly 55% of our operating expense in the company. Obviously a chunk of that is incentive pay. That lever is virtually on auto-pilot. If you have lower volumes, that means managers, people on performance-related incentive plans aren’t making as much money on performance-related incentive plans so that scales down very rapidly, and as I say, virtually on auto-pilot. In addition, you can reduce staffing in warehouses, you can reduce staffing in sales organizations, reduce staffing in staff functions as well, so we do look at all those things. Now, one thing we are very focused on is we want to manage this business for both short-term and long-term. That means that we are not going to make decisions in the short-term that we think significantly impair our opportunity to pursue long-term initiatives, strategic initiatives that we have. So as I have said earlier in my comments, we are focused very much on controlling volume-related expenses, which would be just kind of the normal ebb and flow in the business, and things like the incentive pay, but we are not going to under-invest in initiatives like automation and security where we are seeing significant growth, and we are not going to under-invest in opening our wire and cable business more broadly in the emerging markets. I think those would be bad long-term decisions for the organization, so we are not going to take those decisions to save relatively small dollars in the short term. Kyle O'Meara – Robert W. Baird & Company, Inc.: Okay, thanks.

(Operator instructions.) We take our next question from Matt McCall with BB&T Capital Markets. Sean Connor – BB&T Capital Markets: Good morning, this is Sean Connor for Matt. I have got a quick question. You guys talked about the revenue benefit of the acquisitions in Q4; I wanted to try to get an idea of the EPS trajectory in the next few quarters. I know you guys quantify the annual benefit and I think all in – you know, all five of them, like $0.23 to $0.29 – will that be consistently realized where there is any near-term inefficiencies or costs associated with getting them integrated before you realize that full—

It is not so much a cost issue as it is a seasonal pattern issue. Those businesses, all three of them – well, really all five companies that we acquired are OEM supply-related businesses where they are feeding customer factories from a production standpoint. Those businesses tend to have their strongest quarters in Q1 and Q2 because there is a minimal number of holidays in those two quarters. They end up having their weakest quarters in the third and fourth quarters because you either have scheduled summer vacations or factory shutdowns for maintenance or model year tooling changes, those sorts of things. And then of course the fourth quarter has, at least in North America, the Thanksgiving, and then globally, Christmas and New Year’s holidays in it. So it is more an issue of seasonal patterns than it is, you know, any sort of ramp into achieving the type of numbers we have talked about in the acquisition releases. Sean Connor – BB&T Capital Markets: Are we in outlook that you guys saw this, you know in these quarters that changed your expectations for those businesses? Any?

I think time will tell. Sean Connor – BB&T Capital Markets: I agree. Alright, I guess just kind of looking at – you lot of talk around Q4, I mean, even looking out to next year of get 15% to 20% of your business that is, you know, mostly, shows the most variation with the economy is – I mean, is growth possible next year on an organic level?

First the 15 to 20% applies to the electrical wire and cable in the Enterprise business because that’s really comparing sort of a project volume of revenue versus the moves, adds and changes in the Enterprise business or MRO spending; maintenance, repair and operations spending in the electrical wire and cable business. So, first kind of curve off the OEM supplies not being sensitive to that project volume. And then as I said before I think, the way we see it today and certainly things can change. But the way we see it today, the economic fundamentals that are underlying the project spending in the electrical wire and cable business continue to be strong. We continue to see really good project backlogs at the EPC so we think that business should hold up reasonably well. The business we think has been affected in the project space as we’ve said is the Enterprise business and your guess is as good as mine. What happens to the corporate IT spending next year, but my sense is at least in the early part of the year, our guess, our expectation right now is that project spending will be softer in the Enterprise space in the first half of the year and how the rest of the year unfolds is difficult to project at the moment. Sean Connor – BB&T Capital Markets: Okay, great! Thank you.

Okay. Our next question is from Ted Wheeler with Buckingham Research. Ted Wheeler – Buckingham Research: Yes, hi. Good morning, just following up on that idea. If you look at the Enterprise piece here, where would you say the project activity level is in this fourth quarter or in the last month of the third quarter, as a percentage? I guess you talked about 15 to 20% range, but that sounds like more of an average. Where do you think it is right now?

It’s probably in the mid to low teens right now.

It has definitely pooled in the last couple of quarters. You know, we were probably pushing that 20% number late last year, early part of this year. And I think we definitely probably given up at least 5 percentage points in the make shift there.

I think what happens, Ted, if you look back over the prior four years, we saw a really strong growth in the enterprise business and that was on the strength of good corporate spending on projects in IT infrastructure where we tend to do particularly well because of our business model. When the market slows, the chunk of the market that we do particularly well and ends up being a little bit smaller and so we see an effect from that pretty quickly in our business. Ted Wheeler – Buckingham Research: Right, I guess I’m trying– You know in the last cycle, I guess it got down to 10% or so or lower?

I think at that time we were making comments we felt it was down in the mid to high single digits. Ted Wheeler – Buckingham Research: Okay. Thank you.

We’ll take our next question form Nat Kellogg with Next Generation Equity Research. Nat Kellogg – Next Generation Equity Research, LLC: Hi guys. Most of my questions have been answered, but just a couple of quick ones. Dennis, you mentioned briefly, just heard talking about working capital. I just wanted to touch on it. As you guys grow through acquisition on OEM supply side, are there any differences as far as their working capital needs versus sort of a co-annex or business, I mean to which we expect inventory turns will be slower because of these acquisitions or faster or any difference?

In total, the working capital needs are particularly different by the line item there, there are probably some slight differences, I mean, since the customers tend to be larger multi-nationals, probably a slightly shorter collection cycle on receivables. On the other hand, because of the nature of the service model, the inventory returns are lower, but you certainly don’t want to be in a position, you know, being in a stock-out and shutting your customer down over small components. But when you put those two things together and look at the working capital; the turn number there is not significantly different as it is in the rest of our business in total. Nat Kellogg – Next Generation Equity Research, LLC: Okay. The tax rate seemed a little higher in the quarter, is that just to true things up to get the full year number correct, or is there is anything going on?

Yes, well as you might imagine, with the softness we saw in Europe in the third quarter, we now expect lots of our full year income to come out of Europe than we were expecting at the end of June. And as you probably aware, virtually every country of consequence in Europe has lower corporate tax rates than we have in the U.S. and you know, if you look at the fact that we’re pretty heavily invested in the U.K. I think the rate differential there is above 30% for the U.K. corporate tax rates versus here a combined federal and state rate of 39%. So all that’s happening there in the third quarter is kind of truing up on a year-to-date basis the current expectation of country level income. Nat Kellogg – Next Generation Equity Research, LLC: Okay and then just, last question, sort of on the electrical wiring cable side given the pullback receding copper prices, have you guys – just curious about what you’ve seen as far as in the marketplace, your suppliers and have they started to lower pricing by how much and what you’re seeing on sort of a competitive landscape type of issue?

Actually on a competitive landscape issue in the short-term we’ve really seen no change. As I said in my comments we’re still pricing off the cost of our inventory which is higher cost inventory than the current cost of copper and we’re not seeing any pushback in the market. We’re not – we don’t feel that we’re losing projects with that kind of pricing strategy. And we don’t see unnecessary discounting. There’s a variety of products across that electrical wire and cable space, some of which are priced pretty heavily off copper specifically on the day you place an order. Other products actually work off a price list that isn’t quite as sensitive to copper. So in replenishment in inventory the very copper sensitive products will start coming down in new inventory. But frankly there’s a lot of inventory in the channel that has to be burned off. I think Dennis captured it perfectly when he said the inventory issue lasts roughly a quarter. Sometimes during the course of the quarter you start burning off expensive inventory, bringing in lower cost inventory in the mix. And that’ll start to probably create some downward pressure on pricing towards the later part of the quarter. I think margins hold up through that exercise. Nat Kellogg – Next Generation Equity Research, LLC: And from the supplier side have you guys – you guys have obviously, it sounds like, just started to see some lower prices on the copper – cable you’re now buying in the marketplace.

Well again, the products that are very copper sensitive which are more medium voltage kind of products will – are starting to show some discounting related to copper. But there’s not broad discounting hitting the market right now. And there’s not discounting at all on the products that are selling off price list. I think what you have to keep in the back of your mind is that it’s difficult I think right now for people to understand where copper’s going to end up. We’re clearly in a fairly sudden drop in the commodity based on probably a whole range of factors – speculation around what the – where commodities have been. There was certainly a push toward investing in commodities earlier in the year. Now I think a lot of the trading activity is around speculation on where the economy’s going and if there’s softer demand what does that do? Those kind of – the reality of what’s happening to demand hasn’t flushed through yet. So nobody’s really clear where coppers going to settle. I think therefore, particularly if you’re selling a product off a price list, you wouldn’t be quick to discount that product. Nat Kellogg – Next Generation Equity Research, LLC: Yes, okay. Yes, I think I agree. It’s anyone’s guess where it’s going to end up so it should be interesting. And then just, I’m sorry, one last question. If I look at you guys historically you’ve gotten a little bump in gross margin Q4 and obviously I think, Dennis, you and I have spoken before, that’s often times due to the hitting volume targets and getting discounts and rebates from suppliers. Is there anything else in there that leads to that sort of pickup by the end of the year? So obviously I would expect that you’re not going to hit those this year. I mean, as you guys have been saying. But is there anything else in there that sort of can tweak Q4 gross margins that we should be paying attention to or is that –

No, there’s nothing else in there and your comment with regard to what’s driven that slight pickup in the fourth quarter is accurate. So given the fact we’ve been commenting for a couple of quarters about lower volume incentives it’s realistic not to expect that pickup in Q4. The only thing that works positively Q3 to Q4 would be this customer pricing adjustment both Bob and I have commented on that was – cost us about 20 basis points in Q3 will not be there in Q4. Nat Kellogg – Next Generation Equity Research, LLC: Right, right, okay. Alright, guys, thanks for taking my questions and appreciate the time.

Thanks.

(Operator Instructions.) We have a final question from Bob Franklin with Prudential Financial. Bob Franklin – Prudential Financial: Hi, you mentioned uses of cash flow as delivering acquisitions and share repurchases. Is that in order of importance by any chance?

Well, deleveraging certainly will happen on a day-to-day, week-by-week basis as we generate cash flow. Acquisitions will be dependent on what opportunities are available in the marketplace. And I think at least at the moment share repurchases are probably a solid third. I think like most of corporate America we will be hording precious capital for the moment. Bob Franklin – Prudential Financial: Okay, and when you say deleveraging will occur as the cash builds up, are you talking about on a net basis or do you actually intend to repay debt or repurchase bonds –

We would not be taking out any long-term debt. What we’re talking about is reductions in short-term borrowings. Bob Franklin – Prudential Financial: Okay and what’s your revolver at right now?

In terms of – well there’s 240 million of availability on a facility that’s got a total size of – Bob Franklin – Prudential Financial: 450?

– 450, yes. So about 200 – roughly 200 million borrowed on it. Bob Franklin – Prudential Financial: Okay great, thank you.

And gentlemen there are no questions in the queue at the moment. I’ll turn the conference back over to you for any additional or closing remarks.

Thanks. Thanks for joining us on the call today. We continue to see growth in the electrical wire and cable, OEM supply and security markets. Our combination of knowledge about products, applications and changing technologies coupled with the cost saving supply chain services position us well to bring value in difficult markets. The enterprise business will face challenges in North America, Europe and Asia due to IT spending constraints by larger end users. However Latin America will continue to present growth opportunities in the Enterprise market. We will continue to manage the business for both the short- and long-term by closely managing volume expenses while also investing in initiatives and opportunities for future growth. Thanks for your time today.

Ladies and gentlemen that does conclude today’s conference. Once again we thank you for your participation. We wish you a pleasant day and you may now disconnect.