Mark Pogharian – VP Investor Relations Dave West - President and CEO Bert Alfonso - Senior Vice President and CFO

David Driscoll – Citi Investment Research Christine McCracken - Cleveland Research Pablo Zuanic – JP Morgan Terry Bivens – Bear Stearns Eric Katzman – Deutsche Bank Eric Serotta – Merrill Lynch Andrew Lazar – Lehman Brothers Jon Feeney – Wachovia Robert Moskow – Credit Suisse Alexia Howard – Sanford Bernstein Vincent Andrews – Morgan Stanley Kenneth Zaslow – BMO Capital Markets David Palmer – UBS

At this time I would like to welcome everyone to The Hershey Company First Quarter 2008 Results. [Operator Instructions] Mr. Pogharian you may begin your conference.

Good morning ladies and gentlemen. Welcome to The Hershey Company First Quarter 2008 Conference Call. Dave West, President and CEO, Bert Alfonso, Senior Vice President and CFO and I will represent Hershey on this mornings call. We welcome those of you listening by the webcast. Let me remind everyone listening that today’s conference call may contain statements which are forward looking. These statements are based on current expectations which are subject to risk and uncertainty. Actual results may vary materially from those contained in the forward looking statements because the factors such as those listed in this morning’s press release and in our 10-K for 2007 file with the SEC. If you have not seen the press release, a copy is posted on our corporate website, www.Hersheys.com in the Investor Relations section. Included in the press release are consolidated balance sheets and summary of consolidated statements of income prepared in accordance with GAAP as well as our pro forma summary of consolidated statements of income quantitatively reconciled to GAAP. As we have said in the press release, the company uses these non-GAAP measures as key metrics for evaluating performance internally. These non-GAAP measures are not intended to replace the presentation of financial results in accordance with GAAP; rather the company believes the presentation of earnings excluding certain items provides additional information to investors to facilitate the comparison of past and present operations. We will discuss our first quarter 2008 results excluding the net pre-tax charges. The majority of charges in both 2008 and 2007 are associated with the global supply chain transformation program announced in February 2007. These and pre-tax charges were $30.7 million in the first quarter of 2008 and $40.4 million in the first quarter of 2007. Our discussion of any future projections will also exclude the impact of net charges related to these business realignment initiatives. With that let m turn the call over to Bert Alfonso.

Good morning everyone. First quarter results were roughly in line with our expectations with a 0.6% growth on the top line generating earnings per share diluted from operations of $0.37 or 27% below the prior year due primarily to higher commodity costs and increased levels of overall consumer investment. Importantly our 2008 plans are on track to deliver full year net sales growth of 3% to 4% and EPS diluted from operations of $1.85 to $1.90. Let me provide some additional details. Net sales performance was in line with our internal forecast. As we stated back in January the first quarter was impacted by an unusually early Easter that resulted in fewer selling days and the mid-January decision to cancel the rollout of the Ice Breakers PACS product line. Net price realization of about two points in the quarter driven by the April 2007 price increase was more than offset by lower volumes as we wrapped the Kisses 100th Anniversary Promotion and last years launch of Reese’s Crispy Crunchy. Net sales for the quarter excluding the benefit of the Godrej acquisition were down about one point. The price increase we announced in January 28th had minimal impact on the quarter’s results. At retail the price of a standard bar will still be below $1.00. Post price increase announcement discussions with our retail customers who have also experienced operating costs have been positive. Consistent with past practice we plan to honor a portion of the 2008 commitments related to plant promotion and merchandising events. We’ll therefore only partially benefit from the increase in 2008. Lastly, inventory levels at key distributors are at normalized levels and we did not experience any abnormal purchasing patters related the price increase. Turning now to marketplace performance, consumer take away for the 12 weeks ending March 23rd in channels that account for 80% of our retail business increased by 14.8%. This number clearly benefits from Easter that was about two weeks earlier than last year. As a reminder these channels include food, drug, mass, including Wal-Mart and convenience stores. Excluding seasonal activity, primarily Easter and Valentine retail take away was up 1.8%. Our take away in FDMXC excluding Wal-Mart was up 9% with market share off 0.8 points and reflects some improvement in the food class of trade as a result of increased retail coverage. Excluding seasonal activity, retail take away was about flat down 0.1% with share off 1.1 points. Category sales for Valentine in FDMX classes of trade were up 0.7%. As expected Easter sales declined of 12.3% due to the shorter selling period. As a result, we lost 1.4 share points in Valentine as competitive premium gift packages recorded increased consumer sales. In the Easter period we lost 0.7 share points and maintained a 34% share of the season, almost double that of the next leading manufacturer. Easter sell through was improved verses last year driven by Reese’s Peanut Butter Eggs and Cadbury Eggs. Reese’s benefited from new advertising that both ad week and advertising age recognized as the most light and most recalled spots. Now turning to margins, during the first quarter gross margin was down 220 basis points. As expected our total input costs basket was higher by 260 basis points in the first quarter. A portion of this was partially offset by favorable price and mix. Dairy costs were higher in the first quarter as the acceleration of these costs in 2007 did not occur until the second quarter. Our full year outlook for latest commodities has not changed. As such, we expect input costs to be up about $100 million year over year. We believe that we have good visibility to our costs for the remainder of this year. Net obsolescence costs were at normal levels in the quarter and were slightly favorable year over year. Outside the US Godrej Hershey business generated lower than company average gross margin and modestly impacted our gross margin in the quarter. This impact will dissipate as we lap the Godrej acquisition in May of this year. EBIT with margin was down 510 basis points as selling, marketing and administrative costs increased about 16.4% or 290 basis points as a percentage of sales versus the prior year. Advertising was up 18% in the quarter supporting Reese’s, Ice Breakers and other core brands. Consumer promotion was down slightly in the quarter but will increase during the remainder of the year to support new product launches in the US and in key international markets. For the year, we expect combined advertising and consumer promotion to be up about 20%. EBIT margin will also be affected by the cost of added retail coverage that began during the second quarter 2007 and higher related costs in our international expansion in India and China. We expect EBIT profile to improve in the second half as we lap these prior year investments. Now moving down the income statement, interest expense for the quarter decreased coming in at $24.4 million versus $28.3 million last year. Driven by lower short term interest rates on our commercial paper from about 100 basis points versus the first quarter of 2007. For the full year 2008 on a percentage basis we expect interest expense to be down about mid single digits. The tax rate for the first quarter was 34.8% in line with the prior year. Note that the recorded tax rate is higher than the pro forma rate due to the effective tax rates applicable to business realignment charges. We anticipate a tax rate of about 39% in the second quarter and 36% for the full year. We had average shares outstanding on a diluted basis in the quarter with 229 million versus 234 million shares for the first quarter 2007 leading to EPS of $0.37 per share diluted from operations. Now let me turn to our balance sheet and cash flow. At the end of the first quarter net trading capital decreased versus last year’s first quarter resulting in cash in flow of $186 million. Accounts receivable were down $107 million and remain extremely current and of high quality. The collection of seasonal accounts receivable is a key driver in the quarter when comparing year over year receivables. Inventory was lower by $45 million compared to the first quarter last year and accounts payable increased by $34 million. We expect working capital will improve in 2008 primarily driven by inventory reduction in the second half of the year but not at the same rate as achieved in the first quarter. During the quarter capital additions including capitalized software were $71 million. For 2008 we are targeting total capital additions to be in a range of $300 to $325 million driven by the global supply chain transformation program. Depreciation and amortization was $68 million in the quarter, this includes accelerated deprecation related to the global supply chain transformation of $21 million and operating depreciation and amortization of $47 million in the quarter. In 2008 we are forecasting total deprecation and amortization of $250 million including accelerated deprecation and amortization of approximately $60 million. Dividends paid during the first quarter were $66 million. During the quarter we did repurchase $18 million of our common shares in the open market to replace shares issued in connection with employee stock options being exercised. Our goal is to repurchase all such shares. We did not acquire any stock in the first quarter related to the current repurchase program. There is $100 million outstanding on the current authorization that the Board approved in December of 2006. Value added share buy backs are an important consideration in our capital structure valuation. In the current volatile credit environment share repurchases are assessed against the company’s short term cash flow, financing requirements and investment alternatives. In the near term we will emphasize financial flexibility to satisfy our cash requirements including higher levels of capital expenditures related to the global supply chain transformation program, dividends, and existing joint venture investments while maintaining a strong credit rating that ensures ready access to the capital markets. Progress continues to be made by our Hershey Godrej business in India. We are producing Hershey branded milk mix locally and are working to build distribution and brand awareness especially in the southern part of the country. The hard candy MCC business is focusing on the Maha Lacto brand and expanding distribution in the west near Mumbai and in northern provinces. We will lap the acquisition of the Godrej business in early May. We expect the business to grow year over year and have a positive impact on net sales. However, we do not expect any meaningful contribution to earnings given our investment plans to build the business. In China we continue to make progress and now have full manufacturing capabilities to support our portfolio roll out. We are successfully manufacturing Hershey’s Chocolate Bars in China. These products are specially formulated for Chinese consumers and will help us build a presence in the market. While we currently have less than five share in China our brands are well accepted especially in larger cities such as Shanghai. Similar to India, we expect net sales in China to grow. However, due to brand distribution investment requirements we don’t expect significant profits in the near term. During 2008 the Lotte sales and marketing organization will begin selling and marketing Hershey products in Japan as well as Korea. Now for an update on the global supply chain transformation that was announced in February of 2007. During the quarter we reported global supply chain realignment charges of $26.4 million pre-tax including $25 million of accelerated depreciation write offs in cost of sales and $1.4 million reported in selling, marketing and administrative expenses reflecting program management costs. These charges reduced earnings per share by $0.08 on a reported basis. For 2008 our estimate is total pre-tax charges and non-recurring project implementation costs will be in the $140 to $160 million. Total three year ongoing savings remain in the $170 to $190 million range with a significant savings increase in 2008 compared to 2007. We expect cumulative savings to reach roughly $90 million in 2008 skewed to the second half of the year. Our estimate of total pre-tax charges in non-recurring project implementation costs remain at $525 to $575 million including project management and start up costs of $50 million. Construction of the Monterrey, Mexico facility and relocation of manufacturing lines within our existing network are on schedule and initial production has commenced in Monterrey. Certain production line transfers to our Stuarts Draft, Lancaster and West Hershey facilities have been completed while others remain in process. We are very satisfied with our progress to date although there is a lot to accomplish in the coming months to complete the project and remain on schedule. During the fourth quarter conference call we announced the restructuring of our business in Brazil and the formation of a joint venture with Bauducco. As part of the restructuring we recorded pre-tax business realignment and impairment charges of $4.3 million in this year’s first quarter. It should be noted that this is not part of the global supply chain transformation program. The integration is progressing well and we have already initiated our go to market strategies to fully leverage the scale of budget those capabilities to drive growth from improved distribution and in store brand execution. Finally let me now talk about the outlook for 2008. For the full year we continue to anticipate net sales growth of 3% to 4%. Marketplace performance will sequentially improve throughout the year driven by the launch of Hershey’s Bliss and Starbucks and increased levels of merchandising, advertising and retail coverage. We expect that EBIT margin will be lower year over year due to the higher input costs already mentioned and increased investment in advertising, consumer promotion and selling expenses in the US and selected international markets. As a result, for the full year 2008 EPS diluted from operations remains in the $1.85 to $1.90 range. Now let me turn it over to Dave, he will provide you with additional commentary.

Good morning everyone. As Bert just highlighted our sales and earnings performance during the quarter was in line with our expectations. We made significant progress on initiatives that will benefit net sales and earnings throughout the remainder of the year and beyond. Importantly Hershey’s Bliss and Starbucks products shipped to customers on schedule in mid-March. Consumer and customer excitement around both product lines is high. Consumer investment including advertising, sampling and merchandising accelerates in the second quarter to ensure the success of these launches. We also invested in our core brands in the first quarter and will continue to do so throughout 2008 to strengthen our position in the marketplace. Retail take away market share in the quarter were impacted by an early Easter. Last year Easter was on April 8th more than two weeks later than 2008. Therefore, when we see IRI Nielsen data for the next quad, the four weeks ending April 20 it will show a significant decline in category Hershey Retail Sales. I would also expect softer chocolate market shares in the next period; the gum category most likely will have a disproportionate effect on the total confectionary category as it is not impacted by Easter seasonality. Easter timing aside, Hershey’s marketplace performance is improving albeit slowly. Specifically in the food class of trade, take away has sequentially improved in four consecutive four week periods driven by increased retail coverage. We expect to build on this as we work our way through the year. In the convenience class of trade there are also early signs of improvement again, driven by additions to merchandising coverage. After a soft January the total category in C stores rebounded and was up about 3% in both February and March. This translated to a 2.3% gain for the quarter. Our performance in this important channel also improved. For the 12 weeks ended March 23 our retail take away in the C store class of trade declined 2.2% resulting in a share loss of 1.2 points. While we certainly are not satisfied with this performance it is markedly improved versus the fourth quarter. Going forward, increased levels of core brand merchandising and unique programs such as our Reese’s with Coke partnership and cash for gas where consumers can instantly win free gas when they purchase a candy bar will result in further marketplace improvement in this channel. Among the most exciting 2008 initiatives are the launches of Hershey’s Bliss and Starbucks. These additions enhance our premium trade of portfolio and will enable Hershey to build scale in these sub-segments. Products started shipping in March and we have achieved our introductory distribution targets across food, drug and mass retail outlets. Strong introductory merchandising and display activity is driving initial take away. Hershey’s Bliss advertising began airing March 31st and will accelerate in the coming months driving awareness in trail. We are pleased with the early results as Hershey’s Bliss is tracking as planned. In conjunction with the Hershey’s Bliss advertising campaign we announced the unique promotion to generate some consumer buzz. Specifically we invited 10,000 consumers to host a Hershey’s Bliss chocolate party over the week ended April 25, targeting female chocolate lovers the parties will celebrate everyday bliss by gathering friends and family to share personal stories while sampling Hershey’s newest indulgence. We received an overwhelming number of requests and have garnered over seven million impressions to date. Every host will receive a party pack that includes three flavors of Hershey Bliss chocolate and take home gift bags for guests filled with various Hershey’s promotional merchandise. Starbucks is launched primarily in the food, drug and mass classes of trade with on air advertising scheduled to start in the next few weeks. To drive excitement, variety and news additional Starbucks skus will be launched throughout the year. For example, in mid-May we will launch instant consumable lineup featuring milk, dark and mocha bars as well as chocolate covered mini coffee beans in a tin. In August we’ll over Starbucks 18 count truffle assortment gift box and in the fourth quarter we’ll come to market with Carmel Macchiato. During the holiday season the Starbucks lineup includes Egg Nog Latte, Peppermint Mocha and Gingerbread Latte Truffles in standup bags as well as an assorted holiday gift box. This lineup will help us to be more effective in the gifting component of seasons. A combination, a variety of advertising and consumer sampling will bring excitement to this premium lineup all year long with a particularly strong Q2 investment. As Bert stated advertising will be up more than 20% in 2008. Some of it supports Hershey Bliss and Starbucks but is also supports the core. For example, the Reese’s franchise will be on air all year. This brand responds very well to advertising. Retail take away on the Reese’s franchise was up significantly in the quarter including Easter specific advertising featuring the Reaster Bunny. The standard lose and king size businesses were up over 8% at retail driven by higher levels of base business merchandising behind the on air frequency. During the quarter ad age recognized our Reese’s advertising as the second most like new TV spot for the month of March and Ad Week named four of our upcoming Reese’s spots as break through and compelling and listed them as favorites. We were also pleased with the way the Ice Breakers franchise responded to our Super Bowl ad, results were immediate. In FDMXC our Ice Cubes gum business generated a 10 point improvement in trend in February and then again in the March quad. Our advertising campaign complemented with national SSIs will continue throughout 2008 and we anticipate further sales growth as Ice Cubes gains additional distribution and increased retail velocity. This reconfirms what we know about Ice Breakers, when we combine unique, innovative, and exciting ideas the brands respond. We have other refreshment news in the second quarter and the second half. Investment on our core brands will continue throughout the year. A combination of advertising, increased retail coverage and greater levels of merchandising will occur. These include the Hershey Smores Brad Paisley promotion, Reese’s sponsorship of the upcoming Batman movie The Dark Knight, the US Summer Olympic Team sponsorship and various NASCAR events and promotions. As investment in our core brands ramp up new product launches gain momentum and retail merchandising gains traction marketplace performance should improve. As we look to emerging markets we are pleased with the progress being made in India and China. In India we are investing in go to market capabilities and consumer activities. While costly in the near term we are building brand equity and awareness. In country production of Hershey’s branded milk mix is ramping up and obviously gets the trust Hershey name out in front of the consumer. This is the first step of several in a Hershey branded chocolate expansion in India. In China our manufacturing [inaudible] is in place. We have built the capabilities to bring locally preferred products to market. Building brand awareness, getting trial and repeat and increasing distribution are the priorities we are focused on. We are incorporating what we learned from our first Chinese New Year effort into the remainder of our plans for 2008. The opening of Hershey’s Shanghai Chocolate World will have a positive impact on generating consumer consciousness. The store will be located in the center of Shanghai in one of the busiest pedestrian areas of the city. Renovation work is progressing and we are targeting to open the store before the start of the Olympic Games. The integration of the Hershey Bauducco business in Brazil is off to a great start. We are very excited about this move and our initial progress. Bauducco brings a long track record of success in categories similar to ours, has a powerful distribution organization and shares our conviction about Hershey’s opportunity in the $2.5 billion Brazilian chocolate market. Our 2008 priority is to drive growth through improved distribution and brand execution in store. As Bert highlighted the global supply chain transformation program is on track. We expect to recognize the majority of the 2008 global supply chain savings in the second half of the year as production in Monterey wraps up and we complete the relocation of manufacturing line from closed plants into existing US facilities. Let me wrap up. We are making progress, while it is slower than we would like, we do see the initial signs of improving marketplace trends. We’ll gain further traction as Hershey’s Bliss and Starbucks continue to roll out. Increased retail coverage is working as we move further into 2008 I would expect the new sales associates to be past the learning curve in delivering added value in the store behind improved retail programming. In store programs will benefit from advertising that will be up double digits each quarter the rest of the year. Our international businesses are gaining traction. This gives us confidence that net sales will grow 3% to 4% in 2008. While commodity futures and spot prices remain volatile we have good visibility into our input costs basket for the remainder of the 2008. Combined with increased levels of consumer investment in both North America and international markets we continue to expect earnings per share diluted from operations of $1.85 to $1.90 per share. We’ll have more information to share with you at our June 17th investor update in New York City. For now we’ll open it up for questions.

[Operator Instructions] Your first question comes from the line of David Driscoll with Citi Investment Research. David Driscoll – Citi Investment Research: I had a couple of questions here. The first question was on new product launches, so Bliss and Starbucks launched in March both of them, were they a net contribution when you look at the year over year comparisons on volumes or were new product launches in the year ago period in fact a headwind in the quarter? Is that question clear?

Yes, the question is clear. If you compared us to year ago total new products were somewhat higher when we launched Reese’s Crispy Crunchy and a number of other products. Having said that, we met and/or exceeded our internal expectations in forecast for Bliss and Starbucks on a combined basis. David Driscoll – Citi Investment Research: Do you see net favorability on new product launches getting better throughout the year or is it going to remain a headwind?

I think as we look at the rest of the year importantly perhaps we think that the launches that we do have particularly Bliss and Starbucks but as well as some of the other things in refreshment are going to be much more incremental than they were last year but I wouldn’t expect us to have a big contribution from new products year over year for the rest of the way. David Driscoll – Citi Investment Research: My next major question is Kisses and Kit Kat continue to show up in the Nielsen data pretty negatively, can you talk to us about what’s wrong with those two brands and what do you have in store for us through 2008 that would give us some insight as to how you’re going to fix those?

Part of what’s happening on Kisses is obviously because it is such a large component of the seasonal program with the shorter Easter you would expect to have less Kisses sold just based on seasonal compression year over year. We also had the 100th Anniversary last year in the first quarter and so we had a lot of Kisses activity that we simply just didn’t cycle this year. That would be the tactical answer; the more strategic question on Kisses for us is positioning the brand taking advantage of the brand equity to meet some unmet consumer needs in areas where we currently aren’t playing with the brand. We’ll have some more on that to tell you about as the year unfolds but for now I don’t want to go any further than that. It certainly is something that is on our radar screen, its one of our best and most iconic brand equities and we know we can do a better job with it. David Driscoll – Citi Investment Research: Any statements on Kit Kat?

Actually it depends on where you are looking at the data. The Kit Kat C store business is pretty good, we have a great Kit Kat and coffee tie in with a number of retailers and some end market activated radio behind that program. If you look at Kit Kat in FDMX you’re going to see some seasonal compression because of the package candy aspects around Kit Kat in the seasons. David Driscoll – Citi Investment Research: Last quick question, does Easter have any impact on the second quarter, the Easter timing?

It should be minimal.

Your next question comes from the line of Christine McCracken with Cleveland Research. Christine McCracken - Cleveland Research: I just wanted to touch on your comments relative to pricing. It did sound like you were maybe facing a little more resistance to passing that through than I’d expected. You are remaining committed obviously to the ramp in product support but maybe if you could comment on whether or not you expect to see any retailer’s resistance to the pricing initiatives you have already announced?

Let me take that in two buckets. You’ll remember last April we announced the price increase, last April 2007, let me be clear on that since we’re in April 2008. April 2007 we announced a price increase on standard loose and king and on the six packs and some of the other vending packs, etcetera. When we did that we also said last year that we would honor a lot of the promoted price points that we had planned out for the rest of the year. We didn’t see a lot of net price realization from that in 2007 although in the first quarter 2008 we did get, I think Bert said, roughly two points of price realization from that. The price increase that we announced in January 28th on the same pack types or similar pack types as last year really didn’t impact the first quarter. As we look going forward for the rest of the year we would expect to continue to get better realization on the 2007 price increase and then also while we’ll spend back against that 2008 price increase to hit some of the price points we should see price realization being a benefit for the rest of the year. From a retail standpoint it’s an environment where pretty much across the store prices are higher, inputs are higher. I wouldn’t say that there’s any more or less customer resistance to price this year than there would have been in any other period of time. Christine McCracken - Cleveland Research: On your launch of premium product into what is presumably a relatively weaker economic environment, have you seen any shift in consumer preference between premium and your everyday business and could it in fact be a big stimulus to your everyday business where you’ve seen maybe some weakness in the past?

No, I think the price points on this category when you talk trade up and premium versus mainstream but the price premium and the differences aren’t that significant when you look at package price points. Its something we are certainly watching but it’s too early in the market to read Starbucks and Bliss; we just shipped it in the middle of March. Obviously we’ll continue to monitor it but the category tends to be one that consumers have a pretty high interaction with. Regardless of the economy we would expect it to continue to be a relatively good category for us.

Your next question comes from the line of Pablo Zuanic with JP Morgan. Pablo Zuanic – JP Morgan: On the ad spend, when you are saying that it’s going to be up 20% this year what’s the base. I’m trying to calculate in terms of a percentage of sales. Ad spend on my numbers is about 2.5% so 20% increase means about 50 basis points of sales.

We actually haven’t been giving specific numbers. You can kind of glean them from a number of things that we either file. We are talking 20%, we are talking…

Off the ’07 basis which was in the K of close to $128 million.

You can start from that number and I don’t want to get any more specific because you talk working, non-working, US, International, etcetera. I don’t want to get into a lot more specific than that. Suffice to say we are increasing it and we’re increasing it each quarter and it’s supporting our new initiatives but also importantly supporting the core brands in the Reese’s advertising copy has proven to be very effective and is resonating with consumers. Pablo Zuanic – JP Morgan: A follow up, operating margin is down 500 basis points in the first quarter. They way I understand your guidance for the year that guidance implies about a 200 basis point lower operating margin for the year. Based on your answers to previous questions does this mean that we should expect the savings to come where, most on the gross margin front or the SG&A side? In the first quarter gross margins roughly down 200 basis points, SG&A up 300 basis points. How should we think of those two variables as the year progresses?

I’m not going to comment on gross margin because we do not comment on gross margin specifically. You can think of it as two major impacts. One is the commodities which we are pretty quantitative about; we said it was 260 basis points that impacted us in the first quarter. We’ve talked about the year on year being a similar 100 million from the input basket. The other is that we do have a pretty significant ramp up in our advertising which just talked about. Our selling expenses as well as we get a full year of the impact of the additional retail sales folks. We have G&A which is higher so really those two big buckets. It’s input costs which has some offset in price realization and supply chain savings which are back in sku as well as the additional SM&A investments that we’re making during the year. There is some timing as well from the International investments which largely took place in the back half of last year and so they have a disproportionate impact on our first half. Pablo Zuanic – JP Morgan: Remind us what are the savings here from the global supply transformation, have you given guidance for the year in that regard?

We have, I think in my comments earlier I mentioned that the cumulative impact, it would be last year plus this year, this year should be at a run rate of about $90 million. That total remains in the $170 to $190 million. Those savings are back end loaded in the year as well as the manufacturing facility in Monterrey comes on stream. Pablo Zuanic – JP Morgan: When I think of your strategy on new products on the premium side I understand what you are doing but in terms of single sales in the past there was a big push in terms of single serves and I don’t hear that so much any more in the new strategy. How should we think about single serves or do you find that in terms of single serves mix you’re already well developed in that particular segment?

We certainly have very specific convenience store programming partnered with Coke we have a number of other initiatives going on. We added a significant amount of retail coverage to help sell at the store level in the upcoming months. That’s starting to get online and get ramped up and then as we execute our programming in the second and third quarter specifically a lot of the NASCAR and the Reese’s Batman The Dark Knight events we have a lot of very specific convenience store activity there. We still are very focused on that and also it is an area where we have taken some price increases and we would expect to see price realization coming from our single serve business. Pablo Zuanic – JP Morgan: One very last one, in terms of Bliss and Starbucks can you just remind us of roughly what are going to be the price points you mentioned it would be on the distribution channels just remind us and how are the two products different and who are they really competing with in which segments?

The Hershey’s Bliss product is competing much more in the trade up arena and we would expect to see promotionally usually two bags for $6 price point on the Hershey’s Bliss product line. The Starbucks offering you won’t see it promoted as frequently and the price points are going to vary. It’s going to depend on outlet and it’s going to depend on retailers and pack side. I think we’ve given it before and why don’t you give a call back and Mark will give you some of the specifics.

Your next question comes from the line of Terry Bivens with Bear Stearns. Terry Bivens – Bear Stearns: A couple of follow ups on the top line, I guess you begin shifting Bliss and Starbucks did you say mid-March?

Correct. Terry Bivens – Bear Stearns: Would your top line have been negative without that pipeline fill?

I think we said comparatively we had new product activity in the first quarter of last year that would have had some fill on it and we had some fill on Bliss and Starbucks in this quarter. If we hadn’t shipped that that was in our plan to ship all along we would have had lower top line. Terry Bivens – Bear Stearns: Are you getting incremental space at your existing accounts with those two lines?

It’s actually hard to just say those two lines because the way category management works you do a full review with the customer and you don’t just specifically put one initiative and take one initiative out, you look at the entire body of work if you will for the category. We are getting specifically with Starbucks much better perimeter of the store racking for our entire premium lineup including Scharffen Berger, Dagoba and Joseph Schmidt. It’s hard to say, it’s not like pulling one, one goes in, one goes out this was done with a lot of floor planning so you have category management doing the totality of the category at the same time. Terry Bivens – Bear Stearns: From your answer though it sounds like maybe you did get some incremental with this, is that correct?

As I said, certainly on Starbucks the intent was to get incremental space around the perimeter of the store to get better premium display for our entire portfolio. Terry Bivens – Bear Stearns: Last thing, you just mentioned them then, but in terms of Dagoba, Scharffen Berger, Schmidt you didn’t seem to say much about those in the commentary, how are you looking at those now?

As I said, the important thing is as we come with more scale across the portfolio and Starbucks certainly gives us that it allow us to then activate our category strength and advantage which is selling at retail and much better retail coverage. We now have enough scale to do a premium setup and put up. The brands Scharffen Berger and Dagoba and Schmidt particularly as well as Hershey’s Cacao Reserve will be part of our programming going forward and so it should help those businesses by getting some scale in the market.

Your next question comes from Eric Katzman with Deutsche Bank. Eric Katzman – Deutsche Bank: I guess I have a question about input costs, I know you have your hedging programs and you’re reluctant to comment often specifically but I assume because you are still comfortable with earnings and are still comfortable with the dollar amount of input costs that you must be fairly well hedged on cocoa given the run that its had in the last 90 days. Is that fair to say?

I think what we would reiterate, it was the comment that I made which perhaps is what you are asking about is that we feel that at this point we believe that we do have good visibility to our ’08 cost basket. The market remains at very high levels for commodities and certainly there’s volatility that we haven’t experienced in a while. Having said that there are parts of the market where there is no forward market such as fluid milk so we are monitoring that carefully. We’ve had an impact in the first quarter year on year because of when that escalated last year. Yes, I would reiterate that internally we feel pretty good about ’08 within what I would put into context is a volatile and above average price market. Eric Katzman – Deutsche Bank: Looking longer term how do you feel about the, we don’t have a whole lot of visibility on it, how do you feel about the basket of inputs given that on some of it suppose like peanuts and dairy there isn’t an ability to hedge and I guess there’s kind of a multi year cycle in terms of growth of the cocoa beans. How should we think about longer term? Is there as much of a bias up in your basket as for let’s say a more diversified package food company?

I’m not going to comment on ’09 or beyond ’08 at this stage. Needless to say it’s a volatile market and prices are high and I’m not sure if a different food manufacturer is impacted by different inputs. We do look at it as a basket and we’re not just focused on the cost side but we’ve very focused on the parts that we can manage. Part of that is how we manage our pricing and part of that is aggressively pursuing all of the objectives of the global supply chain transformation which we feel good about. We really have to look at both sides of it not just the cost side from external perspective but how much we control internally and we feel pretty good about what we are doing internally. Eric Katzman – Deutsche Bank: My last question is a follow up. I think it was when you first were named CEO you made a comment that the company was going to need to look through its pricing and some of us maybe mistakenly thought that that might involve decreases but then you subsequently raised prices but I think you would kind of talk about segmentation and adjusting prices to reflect segmentation. Can you talk a little bit more about that and how does the price increase that you put through earlier this calendar year play into that?

I’ll give you just a little flavor for that. I think when we talked last year we talked about price value. Price value is still something that we are obviously constantly monitoring how consumers are feeling about it and in an environment with today’s current macro economic situation the price value equation is something that we really need to be concerned about and continue to monitor. When I referenced that last year, for me it was much more a question of how do we bring value, how do we fill unmet consumer needs and then are there things that we can do to the product line either the product itself, the package, the packaging within the portfolio, the way the shelf looks for consumers to shop and how that interplay happens. We have a lot of consumer research that is fielded and is back. We have segmentation we are working through and we’ll be talking about that as we go forward in the year about what things we see and things we can do to improve our top line as well as our price value perception with consumers. There’s a lot of work, an incredibly large body of work internally going on and I will be sharing that with customers and consumers and with you as the year unfolds. That work is certainly ongoing, and one of the most important things that we are working through.

Your next question comes from Eric Serotta with Merrill Lynch. Eric Serotta – Merrill Lynch: I’m just wondering whether you could talk about C store take away in a little bit more detail. The core chocolate business versus the refreshment business, if I remember correctly last year one of the areas that you were particularly struggling in, in C stores was the gum and mint side. As we look forward your optimism about improving C store trends how much of that is predicated on improvement in the Ice Breakers franchise. It seems that competition in that area is probably going to be increasing this year with Wrigley’s increased focus on regaining some of their share that they lost to Cadbury and Cadbury’s increased focus on their core confection business post the spin off of beverages. Broadly could you give us a sense of what you saw in the first quarter in terms of C store take away for chocolate versus refreshment and then what you’re looking at going forward?

Refreshment continues to do a little bit better than chocolate in convenience stores at the current time. Although category growth in chocolate improved each month of the last quarter. Chocolate take away in C stores improved through the first quarter. We also improved our business, although we still lost a little bit of share and its interesting the growth is more in King size than it is in standard bars. That’s about as much as I’ll give you but why do we feel the need, the reason we continue to grow there, our Ice Cubes business has responded to the program that we put in place. Our gum business is doing a little bit better. Mints are still struggling a little bit and we have some things coming later in the year in our refreshment business some news as well. I think we can get the refreshment business to perform a little better as the year goes on. Importantly we’ve got significant retail coverage increasing convenience store this year which we think is going to help our distribution, its going to help us on shelf, its going to help us execute programming and sell in a number of new initiatives this year and I think our overall C store programming from a shipper standpoint is better than it was last year. We feel that we have the right programming in place, its building, it’s still early to assess but what we’ve seen some spots of improvement. Eric Serotta – Merrill Lynch: To follow up on Dave’s question earlier about some of your core brand performance like Reese’s and Kisses. Kisses in particular had a pretty disappointing or alarming decline in the fourth quarter of last year. I know you cited a number of year on year factors that sort of distort comparability like the 100th Anniversary in the year ago period and the like. I’m wondering as you cut through some of those items that impact comparability could you talk in little bit more detail about performance of the core Kisses franchise and what you’re doing to revitalize that. If I remember correctly that was down something like 7% in consumer take away in the fourth quarter.

: Certainly it is a brand that we know can do better and we do believe will be better in the future. Right now we’re lapping a lot of activity in the year ago period but again that aside the bigger question and the more important question for us is the price value perception the usage occasions and the interaction with the consumer and we have a lot of work that we are currently moving through here internally but we’re not ready to share that with the market yet. Eric Serotta – Merrill Lynch: Finally could you comment on contribution of mix to top line and margins in the first quarter? Was mix actually positive this quarter given the shorter seasonal period or did you still have a drag from mix from continued weaker than targeted single serve performance?

I won’t comment on gross margin I mentioned that earlier when Pablo asked his question. What I would tell you is that the price mix combination was favorable to us but price is more favorable than mix. Eric Serotta – Merrill Lynch: That was pricing from last year’s increase?

That was pricing coming through from last year’s April.

Your next question comes from Andrew Lazar with Lehman Brothers. Andrew Lazar – Lehman Brothers: Just a couple things, one separate from the productivity to supply chain realignment and such you’ve talked a bit in the past about your base productivity, the ongoing year after year productivity you do on the core business. Is there any way to get a better sense of how to quantify that even if it’s a percent of cost to goods annually that you try and hit, is it 1% of cost of goods, 2%, I’m trying to get a sense of the numbers around that.

I won’t mention it so much as a percentage of cost of goods. It’s not as high as the productivity that we’re generating from the global supply chain transformation this particular year. We do have a pretty active continuous improvement program and at a minimum we try to offset the inflationary impact that we expect in our internal plan. We do have an active program, it does provide good benefit not at the order of magnitude of the global supply chain transformation but it is an important piece of how we manage our costs. Andrew Lazar – Lehman Brothers: Certainly in the last conference call I know you talked a bit about the competitive environment in various parts of your business. Was there any real significant change either way in a particular sub-category of note competitively that we should be aware of or not particularly?

I would say no, nothing noteworthy. Andrew Lazar – Lehman Brothers: In terms of the way we should think about market share progress like from a benchmark standpoint is there any way to quantify as you look at your business maybe its in a certain number of your key sub-categories or percentage of your categories, the percent of sales, were you either gaining share or losing share and then what’s sort of a reasonable goal or benchmark to think about even if its two years out where you want to get to. How do you look at it, you have so many different categories and channels and sub-categories I’m trying to get a sense of overall how do shares look and where do you expect them to go and how do we track that?

There’s a growth algorithm that’s brand and consumer driven and then obviously that translates to customers and it’s also a lot of its driven by how we design our trade promotion program. If you think about where we are investing from a brand standpoint, advertising and consumer the things we’ve talked about back on the core Reese’s and Hershey’s brand as well as the new initiatives with Bliss and Starbucks we expect the growth to come from there. If you look at it and want to slice a class of trade we obviously expect to get improvement from our retail activity specifically where we have coverage in food class of trade, convenience class of trade we clearly don’t talk much about Wal-Mart but we’ve very pleased with where our business is with Wal-Mart and then there’s a couple of other places where frankly some businesses are challenged and have been for a period of time. The vending business is a challenging business and we’ve got a couple of the classes of trade where we have some issues that we are working through. I think when we get to June; on June 17th we may be able to give you a better answer to that question. Andrew Lazar – Lehman Brothers: The last thing and this may also be how you’re shaping your thinking around your June meeting. As you go back perhaps to your experience even with the turn around that you are a part of Nabisco. Are there any parallels there that you would help in this prospect? In other words you had large dominant brands there that were losing share to competitors at the time that probably shouldn’t have been. There were a lot of differences but I don’t know if there are any parallels that make sense in thinking about as well?

Certainly focusing we have some phenomenally good core brands. The limited edition line extension strategy on some level while created news on those big brands it also may have distracted consumers from what is at the core of those big brands. That’s certainly one learning that we have is focusing on that core sku, those power skus and doing a little bit less around the perimeter and periphery getting the consumer back to the core two cup Reese’s for example and just fundamental advertising around the essence of that brand its certainly working. We’re looking to do that across the other brands. I think the other thing that you have to also say is the maniacal focus on cost to create the affordability to spend what you need to spend in our brands and with our customers. There are always parallels and I’ve been fortunate enough to have worked for and with some pretty smart people along the way and you learn something from every one of them. I hope that I can bring all that to bear in the market.

Your next question comes from Jon Feeney with Wachovia. Jon Feeney – Wachovia: I wanted to follow up on Andrew’s line of reasoning. Your advertising spending plans for the full year, could you parse that for us between, if it’s possible, core brand support and advertising that’s going to need to back up these pretty significant Bliss and Starbuck launches.

We’re obviously going to support Starbucks and Hershey’s Bliss and we also firmly believe that Hershey’s Bliss advertising has a halo effect back to the entire Hershey portfolio and franchise. Reese’s we’ve got continuity on Reese’s we’re on all year with Reese’s and we’ve got some copy development on some of the other businesses. The obvious question on a couple of the core franchises is until we pick some of the underlying price value or positioning it doesn’t make a lot of sense necessarily advertise a lot on something like Kisses until we have some of the core consumer proposition in a better place. We’re obviously picking our spots but we are banging on particularly in the second quarter you’re going to see a lot of Bliss, a lot of Starbucks and a lot of Reese’s. We’re up all year long and we’re committed to spending that money. Jon Feeney – Wachovia: If you weren’t launching Bliss and Starbucks this year would you say ad would be up mid single digit, double digit, ‘x’ that advertising spending?

Actually I think that’s not really the way we obviously look at it but from a portfolio standpoint I think we have to continue to increase the brand spending particularly behind new news. As I said, I would view the Hershey’s Bliss advertising as is much Hershey’s as it is about a new item. Would you re-deploy that differently, yes you probably would. Obviously Reese’s is going and you have to realize there’s a lot of consumer promotional spending that goes into the mix as well as trade promotion spending. I think in the absence of any one initiative would you do something differently, probably but we are committed to investing behind the businesses and the brands and you might dial it a little differently here and there but we had a lot of work ongoing to determine what the optimal level of each of big brands is and we’re going to get there. Jon Feeney – Wachovia: As a follow up to that, when you look at the back half acceleration clearly you’re spending a lot more in brand support these brands you’re hoping and have every reason to expect its going to accelerate. I’m trying to solve that to how much is a back half acceleration would come from core brands like you mentioned Kisses you are going to come to some piece with what the positioning is and you’re going to spend behind that and that’s going to accelerate. When I look at your plans for the second half how much of an acceleration and how quickly a response to the increased brand support do you need to get to the kind of target that would support your outlook for this year?

Remember we had a lot of net price realization that’s coming, we took the price increase last April and we spent back quite a bit of it last year and we have a second price increase that’s on top of that one. We will get quite a bit of net price realization as we go through the rest of the year. We have a significant increase in core brand support be it advertising and consumer promotions on Reese’s but we also have it on the Olympic sponsorship around some of the brands, we have the Reese’s Dark Knight, we have a bonus movie event that goes across all the brands so we have a really good merchandising program in the second quarter which is going to work well because we’ve added the sales coverage which is up nearly 20% year over year as well. It’s a combination of better merchandising programs, a higher advertising level, the new items in premium and trade up as well as price realization. On top of that don’t forget we also have international growth particularly coming out of Asia. Our Mexico business is doing very well as well. All of the above and the good news is its not any one lever its three or four levers that we think we have to pull on this year. We feel much better about our programming and our prospects going forward because we are not relying on any one thing while we have a number of good initiatives going on. Hopefully that give you the way we’re thinking about it, it’s not any one bucket it’s actually all of the above.

Your next question comes from Robert Moskow with Credit Suisse. Robert Moskow – Credit Suisse: On Starbucks, I imagine one of the challenges you’re going to face is that Starbucks means coffee to most consumers and you’re launching a line of chocolate and Starbucks launched a line of ice cream years ago that kind of had a blend of chocolate and coffee and I think it ended up polarizing a lot of consumers because a lot of consumers just don’t like coffee. How are you going to market this as a Starbucks chocolate when the perception of Starbucks is different, it may be core chocolate product that you have but consumer perception might be different.

You’re absolutely right, it does mean chocolate and it’s going to get us an incredible amount of trial with a very core loyal user. There are people who will not try it simply because it is coffee. We’ve also in the line we have a signature milk and a signature dark chocolate which are not necessarily coffee flavored. There is an opportunity for someone to enter but we frankly don’t expect a non-coffee lover to enter although there are some tea flavors and some other things. Carmel Macchiato is a flavor, a great confectionary flavor. We had some other flavors, tea flavored and some signature milk and dark in the line but you’re right it is going to be a coffee lovers trial and we’ve sized our expectations of the business appropriately because we know who that target is, they’re easier to find frankly when you think about what else they might purchase and where they might purchase. It will help us from targeted marketing. We do recognize that going in. If you think about the Frappuccino business that’s in food, drug and mass now and how big that business has become. That’s going to be just as equally “polarizing” and that’s become a pretty nice size business. As long as we go in with the expectations and target the marketing we think we’ll be fine. Robert Moskow – Credit Suisse: Another question on premium, everyone is doing premium Nestle, Mars and you said that your benefit is that you have scale and sales distribution. Can we look at a typical grocery store and convenience store is that going to look entirely different four or five years from now? Maybe an entire section of the store dedicated to premium chocolate and maybe better position to such. Right now I look in the chocolate aisle I just see a mess of dark chocolate and milk chocolate and it’s not very well organized.

I think we absolutely know we can do a better job in the aisle and actually add on the perimeter with confections. We, as a category have done very little in terms of innovation on the packaging front in the US market. We haven’t done nearly as much with aisle architecture and both of those things are certainly on our radar screen and we are working on them and stay tuned as we go through the year and in subsequent years we have a lot more to say about it. Yes, you should expect that the store ought to look different. I’m not saying that there still won’t be a confectionary aisle but the shopping in the aisle ought to look different because I think consumers are becoming a little bit more savvy and demanding and we need to meet their needs. Robert Moskow – Credit Suisse: You know what I’m saying think about the soup section and what they’ve done and the spice and seasoning sections and what they’ve done. They’ve been very creative in making that an easier aisle to shop. Do you have an opportunity to go your retailers and say let’s make chocolate aisle easier to shop too?

We do and we have and we’re in the process of, as I said, looking at the right way to think how the consumer shops the aisle and thinks about the category and as I said that work is well underway for us.

Your next question comes from Alexia Howard with Sanford Bernstein. Alexia Howard – Sanford Bernstein: A couple of really quick ones, we’ve obviously had major overhaul in the composition of the Board since late last year. Could you comment a little bit on perhaps what the main agenda items are or how you’re using that resource for you? Is it really looking at International growth, more joint ventures, pushing the organic platforms that you already have, is it maybe a bolt on acquisitions or are you more focused on reinvigorating the core product in the domestic market?

That’s actually strategic planning; you just basically mentioned all of the tentative strategic planning which is what the Board obviously engages in in every meeting. We’ve had very good dialog with the Board. The directors have come up to speed obviously very quickly. We’ve had very good dialog about the business. I think we’ll share a lot more about where we’re headed and give you more flavor for that in June. We’re very pleased with how it’s going and they’re engaged in governance of the company, approval of capital and strategic planning like any Board of Directors of a public company is and we couldn’t be more pleased with the progress we’re making. Alexia Howard – Sanford Bernstein: Good, I look forward to hearing more about that in a couple of month’s time. Coming back to the new Starbucks launch, as I understand it, at the moment it has hit a lot of the retail stores as we speak but its not yet in the Starbucks stores themselves, is that right?

That is correct. Alexia Howard – Sanford Bernstein: Is there a plan that at some point further down the road those products will actually get into the core Starbucks retail chains themselves as well?

We’ve had a number of conversations, that is the intention and in terms of timing and what that will look like we’re not really going to be in a position to say right now.

Your next question comes from Vincent Andrews with Morgan Stanley. Vincent Andrews – Morgan Stanley: Just a quick question on the balance sheet, I know you referenced a difficult credit market but what’s the argument really for not being an aggressive repurchaser of your stock at this point?

I’ll go back to the earlier comments, maybe just something on the stock purchase. We do believe that stock repurchase is a valuable way to return value to the stockholder. I think management has shown over recent past that its part of the strategy. I would tell you that this year we have additional cash flow requirements. The one that’s most significant is the global supply chain transformation and we have quit a bit more capital that we’re employing against that project in order to derive the savings that we have in our plans going forward. There are other needs for cash including our current JVs which we’re investing in. I think we’re looking at it more as a priority timing aspect and not that we’ve changed philosophically a view around buy back value.

Your next question comes from Kenneth Zaslow with BMO Capital Markets. Kenneth Zaslow – BMO Capital Markets: Just two, hopefully quick and easy questions, I think last quarter you aid that you were assessing your margin structure and if you can comment on where that is? Do you think Hershey has stabilized its performance in 2008 will for the base for which you can grow earnings or how do you think about it into the future?

We’ll have a lot more news for you come June 17th. I think the assessment of the margin structure Bert did a good job answering that earlier. We had not only the global supply chain transformation program which I think we’ve been pretty specific about our expectations for that over the next few years. We have a very aggressive continuous improvement program and given the input cost pressures that everybody’s been feeling we need to continually look at our cost structure and make sure that we are squeezing as much cost out of the system as we can. We’re no different than anybody else in the industry in terms of where we go mine for costs and we continue to do that very aggressively. We have priced the business here and that’s some new news since I think we last talked in January. We’ll continue to look at making sure that we are passing along the appropriate level of these costs to the consumers where it makes sense. I think with respect to our business performance we see improvement albeit slowly. We are starting to see some stabilization of trend here and I think that that bodes well for us as we look to the future but it’s very very early in the process and to make a comment on forward growth rates or anything like that we’ll defer that to the June conversation as well. Kenneth Zaslow – BMO Capital Markets: When do you expect International to actually start contributing to operating profit? I think you said that the recent acquisition is not going to contribute to operating profit. Is there a timing that you think that this will start to be incremental?

The International actually does contribute to operating profit. What we are saying though is in the initial phases of the joint ventures that we’ve launched in Brazil and India as well as the manufacturing joint venture and the market investment in China that we’re making the appropriate investments to make sure we get the right levels of distribution and brand awareness and so as you look at 2008 clearly their not contributing to growth in profit this year. It’s not that their not contributing to profit. As we go forward and get some scale and get some establishment in the market and the brand identity and the brand equity we would expect those businesses to become more profitable over time. We think it’s prudent particularly in the first year of these joint venture agreements to make the investment to get the brands established in the market.

Your next question comes from David Palmer with UBS. David Palmer – UBS: You mentioned your overall C store programming from a shipper standpoint I think the way you put it is better than last year. I was wondering if you could perhaps elaborate why that is. What are you doing different? For instance, I remember you used to have promotions that were tied to sales and kind of a buy in to the overall annual programs whereas some of your competitors I’ve heard they paid more promotion dollars up front. Could you maybe speak to any changes you’re making in terms of how you’re doing your promotions which might be affecting your shipper uptake?

I think it’s a much richer program in terms of content not in terms of dollars. Its not a change in our promotional dollar strategy its more of a change in just having better programs across the year based on our back door core brands not focused on a limited editions etcetera but really focusing on core brands having some activity, the tie in with Coca Cola and the Reese’s brand has gone very very well. We also have much better merchandising to port at the store level. We have just feet on the street those folks are going to sell very hard to make sure that our programs get better execution and better placement. It’s not anything in terms of the way we’re changing trade promotion structure dollars it’s really all about retail sales and then obviously the higher levels of consumer support should create more suction. David Palmer – UBS: A second one on commodities, I was just doing some rough math I think you said the commodities would be $100 million of a headwind for this year and if I’m doing my math right that’s roughly 200 basis points inflation for the year and a little bit less than that maybe 180 basis points for the last three quarters of the year given the fact that you did 260 basis point of input hit in the first quarter. My first comment is that it’s hard to believe you won’t do much better than 180 basis points for the last nine months given the fact that you’ve got easier comparisons presumably in the second half. Maybe this just means that you’re expecting another bad hit here in the second quarter maybe just as bad as the first quarter.

I just don’t comment on that. If you look at on a year on year basis and I’m sure your math is right, I didn’t quite follow the way you laid it out but if you looked at the first quarter there certainly is a year on year dairy impact. Last year the dairy prices escalated in the second quarter and so we have seen a much bigger impact in Q1 from dairy. As that goes through the year we expect that we would see less of that. There is some if you look at it on a year on year basis from that. The other thing is that as we translate last years cost into this years costs our standards reflect much more of the prior year cost increases as well as the estimates that we expect for this year. I’m not going to comment on your math, I would say if you’re thinking about it in terms of first half, second half certainly first quarter yes, has a higher impact of dairy. David Palmer – UBS: Would we really think of it almost as a tale of two halves because of the dairy influence being the major, major swing factor here? Maybe the second quarter might be darn near as bad as this first quarter and then from there you have a nice step change into 3Q is that reasonable to guess?

I don’t know if I’d look at it that way. As I said, in terms of tale of two halves that are so remarkably different. Clearly the first quarter had the dairy impact and that’s substantial enough for us to make that commentary. There are other elements that affect first half versus second half so I wouldn’t pin it all on commodities. Obviously we’re lacking the Godrej acquisition and because we’re reinvesting pretty heavily there those margins are lower than the company average margin. As we lap that it starts to be less of an issue in the back half. Our savings programs in terms of the global supply chain transformation, some of the plants close and we ramp up production in Monterrey and so those savings will be more beneficial to those second half of the year versus the first half of the year. Those are the types of things that you might think about in terms of looking at margins first half versus second half and not as much only the dairy aspect.

At this time there are no further questions, are there any closing remarks.

Thank you for joining us today and we look forward to seeing you all on June 17th.

Thank you ladies and gentlemen; this concludes today’s conference call. You may now disconnect.