Welcome everyone to the Nordson fourth quarter and FY 2009 results conference call. (Operator instructions) Mr. Jim Jaye, Director of Communications and Investor Relations, you may now begin your conference.

Good morning. Thank you. This is Jim Jaye, Director of Communications and Investor Relations for Nordson. I am here with Ed Campbell, Chairman, President and Chief Executive Officer and Greg Thaxton, Vice President and Chief Financial Officer. We would like to welcome you to our conference call today, Thursday, December 17, 2009 on Nordson's fourth quarter and fiscal year 2009 results. Our conference call is being broadcast live on our web page at www.nordson.com and will be available for 14 days. There will be a telephone replay of our conference call available until midnight Thursday, December 24th by calling 1-800-642-1687. You will need to reference ID number 44672558. Our attorneys have requested we open this call with a cautionary statement under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. During this conference call forward-looking statements may be made regarding our future performance based on Nordson’s current expectations. These statements may involve a number of risks, uncertainties and other factors as discussed in the company's filings with the Securities and Exchange Commission that could cause actual results to differ. After our remarks we will have a question and answer session. I would like to now turn the call over to Edward Campbell for an overview of our fourth quarter and fiscal year 2009 results and Nordson's future outlook. Ed?

Thank you, Jim and good morning to all of you on the call. Thank you for attending Nordson's conference call discussing our 2009 fourth quarter and full year results. Our comments this morning will provide highlights of strong operational performance in the fourth quarter as well as some perspective relative to our outlook for the first quarter of fiscal year 2010. Relative to the fourth quarter I am pleased with the strong performance delivered in the quarter with sales, operating profit and earnings per share all improving sequentially when considered before the impairment charges booked in the quarter. The impairment charges obviously had a big impact on the reported results and we will talk more about these charges as we get into details of the fiscal fourth quarter but as you all know these are non-cash charges that have no impact on the organization’s ability to serve our customers or deliver results to our shareholders going forward. Operating margin performance in the quarter at 20% excluding impairment charges underscores the strong performance in the quarter. In terms of our outlook for the coming year there are positive indicators the global economy is improving and we are seeing positive signs specifically related to Nordson’s businesses as well. I will be speaking more directly to current trends and our outlook for the first quarter of fiscal 2010 but before that I will turn the call over to Greg Thaxton, our Chief Financial Officer, who will provide a summary of our fourth quarter results.

Thank you Ed and good morning to those listening. Regarding the fourth quarter results, sales were $237 million, down 20% from the prior year with volume down 21% from favorably currency effects of 1%. I will remind you we are comparing to a prior-year fourth quarter that was an all-time record for Nordson. Looking at sales on a segment basis, adhesive dispensing sales volume was down 14% in the quarter as compared to the prior-year fourth quarter and advanced technology and industrial coating sales volumes were down 22% and 39% respectively. I will also make the point here to highlight we have changed the name of the industrial coating and automotive systems segment to industrial coating systems which we believe more accurately reflects the composition of this segment’s revenue and customer base. As we look at our sales performance on a sequential basis, that is a fourth quarter 2009 as compared to third quarter 2009, sales are up 15% comprised of 12% volume growth and 3% favorable currency effect. Each of the three segments delivered sequential volume growth with industrial coating up 25%; adhesive dispensing up 14% and advanced technology up 5%. Looking at the 25% sequential growth in industrial coating, this growth reflects improvement we have seen in this segment since orders bottomed in the third quarter as well as some reduction in backlog associated with year-end shipments. With regards to the adhesive dispensing segment, all product lines within this segment were up sequentially with the non-woven’s product line being the largest contributor of growth. As to the advanced technology sequential improvement, we noted back in our second quarter earnings conference call we were seeing improving trends in certain end markets associated with semiconductor and consumer electronics and we delivered third quarter sequential growth of 38% over the second quarter. These favorable order trends have continued but I am highlighting here our fourth quarter sequential performance is comparing against a relatively strong third quarter. Moving down the income statement, gross margin in the quarter is 58% which is strong on a historical basis due to favorable product line mix, a higher composition of spare parts and consumables and a reduction in manufacturing overhead. As we look at operating performance in the quarter obviously the impairment charges have a big impact on reported performance but as Ed noted earlier, these charges are non-cash and do not impact our ability to execute going forward. Of the $243 million expense booked in the fourth quarter nearly all relates to the write off of acquisition goodwill. This charge is the reflection of the significant decline in the global economic environment as compared to the time we completed these acquisitions. This charge does not imply the reporting units associated with these charges will fail to perform to our expectations in the future. Of the total $243 million charge, $3.6 million relates to the industrial coating segment and the remainder is associated with advanced technology. We have included a supplemental financial schedule with our earnings release to reconcile GAAP amounts to adjusted results excluding impairment charges for certain performance measures. For the fourth quarter excluding the impairment charges the operating margin is 20% and this includes $2.3 million of restructuring charges booked in the fourth quarter associated with our spending reduction efforts. Without this charge, operating margin would be 21% in the quarter reflecting very strong operational performance, a level that has not been achieved in 20 years. In addition to strong gross margins in the quarter the fourth quarter operating margin is being driven by the 20% reduction in selling and administrative expenses from the prior year. On a segment basis, in the adhesive dispensing segment, once again delivered very strong operating margin in the quarter of 29%, up from 25% in last year’s fourth quarter and matching the level delivered in this year’s third quarter. Advanced technology’s operating margin excluding impairment charges associated with this segment was 16% in the quarter as compared to 17% in last year’s fourth quarter and 18% in this year’s third quarter. As compared to the third quarter a decline in gross margins primarily associated with the mix in product lines negatively impacted the operating margin for this segment. Industrial coating margin performance excluding the impairment charge improved from negative in the third quarter to 6% in the current quarter primarily due to increasing sales volumes. Net income, excluding impairment charges was $29 million, an increase of 21% over the third quarter of 2009 and just $1.9 million below last year’s fourth quarter, again which was an all-time record. At 12% of sales, this adjusted net income is reflective of solid execution in the quarter. Fourth quarter diluted earnings per share excluding impairment charges is $0.85, down just 6% from the prior year’s fourth quarter, again an all-time high. The current quarter’s performance included restructuring charges of $0.04 per share. Cash measures in the quarter were also very strong. Sources of cash were $45 million of net income plus non-cash charges and $23 million of working capital. Uses of cash in the quarter included a reduction in long-term liabilities of $19 million, capital expenditures of $3 million and dividends of $6 million resulting in adjusted free cash flow after dividends of $40 million in the quarter, more than triple the level generated in the prior-year’s fourth quarter and up 15% on a sequential basis. The current quarter’s EBITDA, excluding impairment charges, is $54 million, up 20% on a sequential basis. On a full-year basis, sales reached $819 million. The current year’s operating profit excluding the fourth quarter’s impairment charges is $115 million or 14% of sales inclusive of restructuring charges. Excluding both impairment charges and restructuring charges, operating margin for the full year is 16%. Free cash flow for the year was $140 million, more than double the level generated in the prior year. In summary, we are encouraged by the 15% sequential growth in fourth quarter sales and pleased with our fourth quarter operating performance and cash metrics. On a full-year basis, the spending reduction initiatives we began in September of 2008 contributed to a 20% reduction in total selling and administrative expenses inclusive of restructuring charges enabling us to mitigate the large portion of the sales volume impact on operating profits.

Thank you Greg. I will now turn to some brief comments about our outlook for the first quarter of fiscal 2010 but before I do I would like to add some perspective on the outlook we will share. Although we continue to see significant challenges in the global economy, we also see indicators that convince us the worst is behind us on a macro basis. However, the shape of the recovery is still very uncertain. Specific to Nordson I do believe we are seeing recovery in many of our end markets as evidenced by our sequential sales performance in fiscal 2009 and our recent order trends. We have provided our most recent order data both on a segment and geographic basis with our press release. As a reminder, these orders are for the latest 12-weeks as compared to the same 12-weeks in the prior year on a currency neutral basis. Looking to these orders for the 12 weeks ending December 13th, overall they were up 4% from the same 12-week period in the prior year. Within adhesive dispensing orders were up 3% from the prior year on a 12-week basis. The product lines within the segment that serve consumer non-durable end markets are driving the growth in this segment. Regarding advanced technology our order patterns have continued at a strong pace where 12-week order rates are up 20% from the prior year as many of the end markets served by this segment continue to recovery including semiconductor and consumer electronics. More specifically, of particular recent strength is our technology supporting PC microprocessors, Smart Phone applications and LED applications. Something that is particularly noteworthy is the return of order demand from sub-contractors serving these consumer electronic end markets as this volume had been missing for quite some time from our order books. Finally, orders associated with the consumable product lines within this segment have increased on a sequential basis as consumption of components has increased. Within the industrial coating segment, the latest 12-week orders are down 22% which is reflecting of easier comparisons and continuing weakness in systems demand in consumer durable end markets. Demand in this segment appears to have bottomed about three months behind the company as a whole but we have not yet seen signs of a recovery of any significance. Looking at our order rates on a sequential basis, that is the latest 12-week orders as compared to the preceding 12-week period, we continue to see improving order trends where orders for the company are up 12% again on a currency neutral basis. Overall, I am pleased with these improving trends in orders and optimistic that business conditions are getting better. As we look at expectations for the first quarter we currently project sales growth of 13-17% over the first quarter of fiscal 2009. Volume growth is expected to be in a range of 7-11% with favorable currency benefits of an additional 6%. Given the mix of products assumed in our forecast, we expect gross margin to be about 58% in the quarter and total selling and administrative expenses should come in roughly equal to the prior year with volume declines offsetting currency effects. We do expect a one-time tax benefit in the quarter of about $3.5 million or $0.10 per share and a $0.01 per share charge restructuring cost. This outlook results in estimated earnings per share for the quarter of $0.61 to $0.71 per share with the midpoint of this range double the prior year’s $0.33 per share and up from 2008’s first quarter earnings per share of $0.62. In summary, we are encouraged to see the pace of our business improve although we recognize the current business environment continues to be challenging and the shape of recovery is still uncertain. Although we will see levels of selling and administrative expenses return in 2010 as we move forward with restoring some benefits to employees that were eliminated in 2009, we will take a cautious approach with regards to managing the business while continuing to fund those investments that are important to our underlying business. Furthermore, we continue to believe we have the products, organizational talent, resources and liquidity that leave us in a strong position relative to our competition and we are well positioned to respond to a global economic recovery. Now let’s turn to your questions.

(Operator Instructions) The first question comes from the line of Charlie Brady – BMO Capital Markets.

With respect to the orders in advanced technology up 20% on a 12-week basis, how much of seasonality if at all played a part in that and what kind of follow through would we expect going into the quarter? I’m trying to understand if you had a rush coming in from the lump that might steady out after that up 20%?

Actually I would say our orders are unseasonably strong. In other words this is a time generally across all of our businesses that orders begin to weaken a bit beginning in November and moving into December. Although I will say that seasonal pattern is a little less consistent in advanced tech. We clearly have seen a real pop in orders in advanced tech as we have I would say in each of our segments. There seems to be some trends here of momentum that I think are quite interesting. Greg I might ask if you can make reference to what we have seen since the beginning of the fiscal year, at least directionally.

Since the beginning of the fiscal year as Ed mentioned we have had a bit of a pop in some demand. You are referencing the 12-week comparison as compared to the prior year so we have some element of comparison to some weaker performance last year but clearly as we look at orders in the current fiscal year which is the last six weeks as compared to the same six weeks of the prior year. The total company, our orders are up 18%.

I would just amplify a bit on the environment we are seeing in the technology markets. I will, as we often do, refer to Gartner, as a public data point of reference. Back in September they had put together a forecast for 2010 that indicated they expect spending for packaging and assembly equipment to be up 41% in 2010. They have now raised that forecast from 41% to 53% rate of growth in 2010 and that is not because they are comparing to a weaker 2009. In fact they increased their 2009 forecast and significantly cranked up their 2010 forecast. In automated test equipment that same pattern continues. They are now projecting growth and the demand for automated test equipment and semiconductor markets to grow next year by 60%. I think what we are seeing and what is indicative in some of these public forecasts is that there is a real pop going on in these technology markets and we have seen even just since our Investor Day a real increase in the most recent 12 weeks of technology orders.

On the ICF business, the margins there from our perspective were surprisingly strong. Has that business finally turned a corner to where we are in the black now and you would expect that to have positive margins on a go-forward basis?

It is going to be driven by volume. The cost reduction efforts and restructuring that the leadership and team in that segment put together has been very significant. Those changes are in place. The organization is stable. It is operating on an entirely different cost base. I think if you just look at the revenue we had in Q4 compared to the revenue in Q3 there is a pivot point in there that is going to be a function of our ability to continue to drive revenue at the levels that would be more positive. We indicated in our comments the volumes that we saw in the fourth quarter reflected improvement from the low point in demand that we saw in Q3 but it also reflected some shifting down of a bit of backlog in the fourth quarter. I think as we go forward we will be operating at a level that is going to be driven by where orders seems to be on a go-forward basis. I think we are probably just in the range of that pivot point and until we see the improvement in orders from the trend they have been here in recent weeks.

Is Q3 of this past fiscal year the low point in terms of sales do you think?

I do.

The next question comes from the line of Matt Summerville – Keybanc Capital Markets.

In the press release I think you mentioned for the full year Nordson was successful in taking about $86 million out of SG&A. I am trying to get a feel for as you build your view on 2010 or fiscal 2010 how much of that do you view as permanent, structural in nature versus how much should we think about coming back through the P&L this year?

I will give you some broad strokes. The first quarter was a quarter of transition last year as we had some of our spending reduction efforts implemented but not all. If you look at the dollars of SG&A that the corporation incurred in quarter’s 2, 3 and 4 you can see we were running $94-96 million kind of run rate. I’m sorry, $84-86 million run rate. We talked about on a volume basis being down about $80 million for the full year and about half of that coming back. So if you say half of the 80, $10 million a quarter, I think that gives you some kind of a perspective from that $84-86 million kind of run rate that in broad strokes would be where we anticipate we will be across the year.

If we look at that $40 million that sort of comes back, is there a way to bucket that in terms of how much is discretionary spend related versus top line driven? Obviously your selling expense is going to be up if your volume is higher.

First of all, we have merit increases we have reinstituted across the board. So we have a level of compensation increase that reflects those changes we have done. We also have a portion of compensation that is tied to the performance of the organization and various forms of incentives. That total set of compensation changes, presuming we hit our performance targets or better, would be more than half of that. Then on top of that we have some things that are tied to travel and probably increased selling and marketing expenses associated with programmatic activities that we believe merit spending in the year to achieve the kind of opportunities we think are out there.

I was hoping you could talk about a little bit more in advanced tech. You mentioned in the quarter maybe mix was a little bit adverse. I guess when you look at the order book how should we think about mix going forward? Advanced tech before the downturn prior to some of the acquisitions you made the last few years were running into the 20% or so plus or minus operating margin. Is that a run rate you feel based on the trends you are seeing would be attainable at some point during this fiscal year?

First of all let me talk about the quarter. There clearly was mix in the sales that we had in Q4 as it compares to Q3. We had our first big step in recovery in quarter three that was focused within those product lines that had particularly good margins. What we saw in Q4 and what we are seeing the order strength now is strength across all of our product lines and some of those that are comparatively contributing less than some of the others affected that. Revenue that was up to 6% it had a different mix of products and so on. I think as we look into what we see in 2010 obviously there is a volume effect as well. I would expect we would see not necessarily a mix that would turn back more to the second and third quarter necessarily but I think with the kind of forecast that industry observers are saying is available to organizations like Nordson that volume effect is going to provide some lift. As to giving a specific forecast I am not inclined to do that.

Can you talk about what your view is on pension expense fiscal 2010 versus fiscal 2009? Ed maybe you could comment how the management transition or the CEO selection process is evolving here?

On pension expense and just for the benefit of everybody else who may be on the call, we measure our liability at the end of our fiscal year. At the end of October of 2008 interest rates were very high and they have come down dramatically to the end of October 2009. So that has a big impact on the discount rate that affects that pension expense. In total, I would estimate pension expense about $6 million in 2009 increasing to about $15 million in 2010.

As you will recall, the board of directors announced my desire and intention to retire early in calendar 2010. Obviously the board of directors has been engaged in managing that process on behalf of the corporation and while there is no announcements to be made today I think it is reasonable to project that timetable will be met.

The next question comes from the line of Gregory Macosko – Lord Abbett.

Could you give a little color on the impairment charge? I realize it is non-cash and realize it won’t affect the individual companies, etc. Could you go through how will that affect the D&A going forward and how much is goodwill versus actual assets?

Of the total charge the majority of that charge is comprised of goodwill. Call it 90% or so of that charge is goodwill. There is no amortization impact associated with that write off. The other largest piece of that were other indefinite live assets that also you don’t amortize. So it won’t have an effect year-over-year on amortization expense.

Indefinite?

An indefinite live asset would be something like trademark or trade names.

The next question comes from the line of John Franzreb – Sidoti and Company.

I want you to talk a little bit about what is going on in adhesive dispensing. The order book is only about 3%. I wonder within AD are we seeing relative pockets of strength in packaging or weakness in parts and assembly? Could you provide a little bit more color on what is going on in adhesive dispensing and what your thoughts are going into 2010 and how that plays out?

As we had in the press release, orders compared to the same period a year ago were up three but if we look sequentially, in other words the most recent 12 weeks compared to the prior 12 weeks, they are up 12% and if I look at the period since the beginning of the fiscal year which is about six weeks, they were up 13%. The strength we are seeing is actually quite broad based. Our packaging business has numbers that look very similar to the segment numbers. The durable goods segment that we call product assembly has similar kinds of sequential numbers. It is really quite broad based. I am encouraged by the fact we are seeing this kind of performance in all product lines within that segment.

Is that also true across geographies?

I don’t have that data right in front of me but this is a business generally that is comprised of many, many small customers rather than dominated by a few across the entirety of the segment. I don’t think it is dependent upon any narrow group of customers. I will also indicate there has been quite a bounce in orders we have seen since the Investor Day, looking at the absolute dollars of orders we were looking at back in the middle of October versus what we are seeing today in the middle of December. There is real encouraging signs the order pace is strengthening.

Are we seeing an increase in system work there?

Yes. We are seeing an increase in systems as well as parts. In fact, when we see bounces like this where we are talking about 12% growth in sequential volumes or 13% year-to-date kind of volumes those are disproportionately systems because of the stable nature of the spare parts orders.

Regarding advanced technology it has been talked about a bit but you kind of left out anything on EFD. Can you talk a little bit about what is going on in the EFD side of the business?

I guess we tried to make reference to the fact that the order rates in advanced tech for the consumable portions of the business were up nicely as well which is indicative of faster run rates. It has numbers on both sequential basis and year-to-date basis that are up high single digits.

I hate to go back to this as I know I can check the transcript, but did you saw your SG&A assumption was flat year-over-year for the first quarter?

Yes. In nominal dollars. In other words, because the dollar is weaker that means the foreign currencies are stronger and are therefore spending just that line item on the income statement. We have a currency portion and then we have a volume portion. The currency increase is offsetting the volume decrease so on a nominal dollar basis we are saying flat year-over-year.

What about the increased accruals for compensation?

They would be included in that number in the volume.

The next question comes from the line of Matt Summerville – Keybanc Capital Markets.

I think you had indicated for the last six weeks the total company has seen an 18% increase in orders. I think that was on the heels of a comment you made, Ed, where you feel that kind of pace is unseasonably strong now. For my benefit is there any kind of historical reference that you can provide that helps put a little more context around that? Then Greg, I was wondering if you were willing to give the 18% if you could give the break down between the segments?

I’m not sure I can necessarily give you a historical context just sitting here right now. I will put some perspective on the company’s total orders. If I look moving away from percentage comparisons to the prior year and just look at what was the order rate we were seeing for the previous 12 weeks from the Investor Day in mid-October in millions of dollars and I compare what it would be looking back in the most recent 12 weeks from last year, orders have increased by $100 million annual run rate. So that is a real meaningful pop. We are operating now with the highest rate of orders we have seen since more than a year now and we are not back at the billion run rate level but we are in the range of $900 million to $1 billion run rate in orders right now.

With the conversations you are having with your customers in advanced technology and moving the Gartner forecast aside for a second, just more based on conversations that Nordson is having with its key customers in the space how do you feel about the sustainability of the tempo in that business right now overall?

The technology markets generally, as we all know, are cyclical. These cycles can be very independent of economic cycles. They are a function of capacity and demand and most importantly new products and items that could drive consumer demand and the pull through with capital equipment. It is pretty clear beginning in late 2009 continuing into 2010 the broad industrial technology market investment pace has really picked up. So we are now back in the sweet part of the cycle. It is not economically driven, it is just the investment in new technologies. In the world in which we operate, the big drivers that if you will are driving this are associated with all forms of personal computing. They are associated with Smart Phones and they are also associated with a lot of investment in high brightness LED lighting that are being used in flat panel displays. There has been a lot of conversation around televisions. Also all forms of back lighting for computer monitors, notebook computers and all of the other areas where we see flat panel displays are now being manufactured with different types of technologies. So broad based but even within some of the packaging markets we deal with there are disproportionate paces of investment in some of the [stack guy] and entry level packaging concepts that we have talked with Investors about in prior sessions.

Are you seeing a pull through on the test businesses at the present time?

That business is also strong, yes. In fact, we are seeing that in our own order book and it is reinforced by the observation Gartner is talking about with growth rates being up 60% in 2010.

There are no further questions at this time. I will turn the call back over to you.

Thank you. Just as we close I would like to summarize those points I think are key take-away’s from today’s call. First the impairment charges we booked in the quarter do overshadow somewhat what was otherwise a very strong quarter where net income excluding the charge was approximately equal to that of the prior record year amount. As we have previously stated impairment charges in no way impact this organization’s ability to deliver value to our customers or our shareholders. Secondly, Nordson’s end markets continue to show signs of improvement and we are pleased with the improvement in order rates both sequentially and also compared with what we had across 2009. This improvement in order rates supports our strong outlook for the first quarter of 2010. Third, the investment we have made in our spending reduction efforts in 2009 have contributed to strong operating performance and excellent cash flow and we expect to see these benefits in 2010. Lastly, during 2009 we continued to make the appropriate investment to improve our competitive position in the marketplace and we are going to continue to do that in 2010 although we will be managing the business with conservative bias regarding operating expenses. So this concludes the call. I would like to thank all of you again for your continuing interest in Nordson.

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