Frank Sullivan – President & CEO Ernest Thomas – Sr. VP & CFO

Ivan Marcus – KeyBanc Capital Markets Kevin Mccarthy – Bank of America Securities Jeff Zekauskas – J.P. Morgan Securities Edward Yang – Oppenheimer Rosemarie Morbelli - Ingalls & Snyder Daniel Rizzo - Sidoti & Company Unidentified Analyst - Goldman Sachs John McNulty - Credit Suisse Greg Halter - Great Lakes Review

Welcome to RPM International’s conference call for the fiscal 2008 third quarter. Today’s call is being webcast and can be accessed live or replayed on the RMP website at www.rpminc.com. Comments made on this call may include forward-looking statements based on current expectations that involve risks and uncertainties which could cause actual results to be materially different. For more information on these risks and uncertainties please review RPM’s reports filed with the SEC. During this conference call references may be made to non-GAAP financial measures. To assist you in understanding these non-GAAP terms, RPM has posted reconciliations to the most directly comparable GAAP financial measures on the RPM website. (Operator Instructions) At this time I would like to turn the call over to RPM’s President and CEO, Mr. Frank Sullivan for opening remarks; please go ahead sir.

Good morning and welcome to RPM’s conference call for our third quarter ended February 29, 2008. Joining me on the call is Ernie Thomas, RPM Senior Vice President and Chief Financial Officer. I will provide a few highlights of the quarter after which Ernie will cover the quarter financial results in more detail and following this we’ll be pleased to answer your questions. Overall we were very pleased with our operating results in the fiscal third quarter especially in light of the prevailing economic conditions in North America and with such a slow start to our quarter in December. Sales, net income, diluted earnings per share were all records for the third quarter reflecting new product introductions particularly in our consumer businesses, continued strength of our key brands across all businesses, the diversification of our end markets and our growing international presence. Cash flow from operations was also at record levels on a year-to-date basis up nearly 21%. During the quarter we were able to strengthen our credit profile with a new $250 million senior note offering which we completed in February despite continued uncertainty in the US capital markets. This 10-year 6.5% bond enabled us to improve our liquidity which currently stands at more than $700 million. Perhaps equally as important this bond lengthens our weighted average maturity of our outstanding debt. The traditional characteristics of RPM’s growth including a balance between consumer and industrial markets, internal and acquisition growth and a growing international presence and RPM’s entrepreneurial operating structure combined with a strengthened credit profile and strong liquidity will serve to provide the company with real staying power and financial flexibility during these challenging economic times as we finish this fiscal year and move into our fiscal 2009. I’d now like to turn the call over to Ernie Thomas to provide you with details of our quarter.

Thank you Frank and good morning everyone. Thank you for joining us on today’s call. Before I begin with my more detailed comments on our operating results for the quarter, please note that my comments on the fiscal year to date will exclude the $15 million cash settlement for asbestos claims against an insurance carrier which occurred during last year’s second fiscal quarter. Net sales for the fiscal third quarter for 2008 grew 7.7% to a record third quarter total of $731.8 million. The 7.7% increase in sales comprised organic growth of 3.9%, foreign exchange of 3.2%, net acquisitions of 0.6%. The improvement in foreign exchange relates to a stronger euro and also a stronger Canadian dollar primarily. By segment, the industrial segment net sales of $467.1 million grew 9.7% over last year’s third quarter total. The 9.7% year-over-year increase comprised organic growth of 3.4%, foreign exchange of 4.1% and net acquisitions of 2.2%. Consumer segment net sales of $264.7 million were up 4.3% versus last year’s total. The 4.3% increase comprised organic growth of 4.6%, net foreign exchange of 1.7% and a decrease due to our Bondo sale of 2% for the quarter totaling 4.3%. While retail buying behavior in the US continued to soften during the quarter reflecting weakness in the overall economy led downward by the housing sector, the combination of our new higher-end product offerings, the diversity of our end markets which mainly include many low-dollar repair and maintenance items, resulted in a net sales growth for this segment over the prior year third quarter despite again the softening economic conditions. Gross profit continued to improve. Our gross profit margin on a consolidated basis was 39.8% in the current quarter versus last year’s 38.8% due primarily to recent increases and improved operating leverage related to the increase in sales volume on a year-over-year basis. We did experience some rising costs in certain key raw materials during this quarter due mainly to higher energy costs. Key raw material increases included [plastersizers], solvents, epoxies, resins, Polyols, and TDI and silicone. Lagging selling price increases are now taking hold in the marketplace and continue to improve our margins. In addition we have seen some prices of some materials begin to decline in recent months; for example copper and [seedlack] in line with softer demands. Our industrial segment gross margin improved slightly to 41% from 40% a year ago due largely again to selling price increases previously mentioned. The consumer segment gross margin of 37.7% in the current quarter was up slightly over last year’s 36.8% mainly due to productivity gains associated with higher sales volume in the current period. Our consolidated SG&A expenses increased slightly to 36.4% of sales versus 35.5% a year ago. This increase is due mainly again to the legal settlement we mentioned earlier and higher benefit and compensation costs in the current period. Corporate and other expenses were essentially unchanged at $12.7 million this year compared to $12.5 million a year ago. Earnings before interest and taxes, EBIT, grew 11.4% for a margin of 3.4% compared with 3.3% margin a year ago. By operating segment, the industrial segment EBIT was essentially flat at $18 million versus $18.1 million a year ago. EBIT growth for this segment would have been in line with sales growth for it not for a legal settlement that impacted the current quarter. The impact of this settlement in the current period was about $1.6 million. The consumer segment EBIT at $19.8 million grew $2.9 million from last year’s total, improving about 17.6% on the increased sales growth. The increase in EBIT was due primarily to increased leverage related to the higher sales volume in the current period. The margin was 7.5% in the consumer segment versus 6.7% a year ago; a very nice gain especially considering the economic conditions. Interest expense on a net basis was down $1.6 million year-over-year primarily due decreased interest expense related to rate decreases on our variable rate debt. Overall rates for the quarter averaged 4.9% versus 5.5% one year ago. Our effective tax rate for the quarter was 22.2% compared to last year’s third quarter effective tax rate of 11.6%. The increase in tax rate this year relates primarily to the absence of a $2.1 million benefit last year related to prior year tax liabilities in the prior period. Net income for the quarter at $12.2 million represents a new record for a fiscal third quarter, increasing $2.1 million or 20.9% from last year’s $10.1 million total for a margin on sales of 1.7%, improving from 1.5% a year ago. Diluted EPS at $0.10 for the quarter also represents a record for fiscal third quarter, up 25% compared with last year’s $0.08 per share. On a nine-month year-to-date basis, fiscal 2008 net sales grew 10.1% over last year to record sales total of $2.6 billion. The increase in year-over-year and the 10.1% change comprises organic growth of 5%, foreign exchange of 2.9% and 2.2% from net acquisition growth. Net income on a year-to-date basis, $135.3 million, again a new record for the company for the first nine months of any fiscal year increasing 18% from last year’s adjusted total of $114.6 million. Again the $15 million gain for asbestos is excluded from that $114 million total for a net margin on sales of 5.3% compared to 4.9% a year ago. EPS $1.06 per share this year, also a record for nine months of fiscal 2008 up 16.5% compared to last year’s $0.91. A few comments on the balance sheet, net receivables up $73 million on a year-over-year basis. Most of this increase relates to increased sales activity, $50 million due to that. Foreign exchange translation accounted for 23.5% of the balance of the increase. Inventories on a year-to-date basis up $32 million versus last year. Net acquisitions accounted for $3.4 million of that increase. Foreign exchange effect was $18.5 million on a year-over-year basis and the balance was due to increased business activity overall. Total debt stood at $1.1 billion up just under $200 million over last year. This mainly reflects of course the new bond deal that we completed in February; $250 million. And the balance is also due to increase acquisition outlays during the current period. Available liquidity at the end of February stood at $820 million which is an outstanding total for us. I should also note that in early March we repaid $100 million of senior notes due March 1, 2008. Our net debt at the end of February stood at 37.7%, improved from 43.3% at May 31, 2007. Our total asbestos liability at $286.7 million at the end of February compares with $354.3 million at May 31, 2007 reflecting $67.6 million in pre-tax payments made during the first nine months of fiscal 2008 which compares to payment of $48.4 million made in the same time period a year ago. For the third quarter we spent $18.7 million of which $9.3 million was for settlement costs compared to $11 million spent for settlement costs a year ago. We spent $9.4 million on defense versus $7.2 million spent last year on defense. We secured dismissals and/or settlements of 225 claims versus 736 claims in the third quarter last year. The total number of active cases at the end of the third quarter stood at 11,350 up slightly from the May 31, 2007 active case load of 10,824 and a 02/28/07 case load of 10,846. Consistent with prior recent quarters the number of new cases filed year-to-date in fiscal 2008 is about 9.6% below new filings received in a nine-month period of fiscal 2007. On a year-to-date basis we have spent a total of $67.6 million of which $35.6 million has been for settlement costs compared with $48.4 million in total payments last year for settlements of which $28 million was for settlements. For dispense payments, year-to-date we have spent $32 million versus $20.4 million in the same period last year. Without the extra transitional expenditures this year which have been about $12.1 million our defense payments on a year-to-date basis would have been inline with our slightly below last year’s total. We continue to evaluate our key liability assumptions for our 10-year asbestos estimate and in so doing review the adequacy of our existing accruals on a regular basis. As we have mentioned previously we will make appropriate adjustments to our balance sheet for asbestos when it is necessary to do so. Although difficult to predict with certainty, we would anticipate that our fourth quarter cash outlays for asbestos will be below prior year levels. As we’ve noted in the past there can always be some quarter to quarter volatility in our total cash outlays for asbestos. Finally there are no new developments to report to you in our insurance coverage case as we await the Judge’s ruling on the key liability issues in the case. Operating cash flows on a year-to-date basis were $161.8 million compared to $133.8 million generated in the same nine-month period of fiscal 2007 for a net increase of $28 million. The changes in working capital resulted in the use of cash on a year-to-date basis of $18.7 million versus the use of cash of $13.6 million a year ago. Net decreases in trade accounts receivable provided $181.2 million of cash during the current period versus $177 million provided last year. Increased inventories required $51.9 million use-of-cash in the current period versus a $49 million use-of-cash in the prior period. Additionally reductions in accounts payable required $103.2 million use-of-cash during the current period versus an $88.5 million use-of-cash last year for a $14.7 million additional use-of-cash period-over-period, mainly as a result of increased overall activity levels and changes in the timing of certain payments. All other changes in working capital items had a net positive impact on cash flow of $8.3 million for the period. I’ll now turn the call back over to our CEO, Frank Sullivan, Frank?

Thank you, Ernie. Subsequent to quarter-end we completed two acquisitions. On March 5th our German-based Tremco Illbruck subsidiary of our Tremco Group acquired Prosytec SAS in France, a $40 million producer of sealants for the construction and window assembly markets in Southern and Eastern Europe. On March 11th our Euclid Chemical subsidiary acquired the $15 million Increte Systems, a leading producer in the US for decorative concrete. We currently have one pending acquisition which is European-based and roughly about $80 million in sales that we expect to be completed in this fourth quarter. These acquisitions will actually be slightly dilutive to earnings during the fourth quarter principally as a result of transaction costs and required inventory step-up costs. However they should be accretive to earnings during fiscal 2009. While it is hard to forecast future acquisitions we do continue to see good activity in the small to medium sized deal range and are well positioned with a strong balance sheet and good liquidity to continue our successful acquisition program. Given the strong results of our third quarter it is likely that our full year results for sales and earnings growth will now be in the 10% to 12% range, keep in mind that this is based for comparison to last year on an adjusted $1.57 per share for our fiscal year ended May 31, 2007. That is, our GAAP results less the impact of the one-time $15 million asbestos recovery gain we had last year. We plan on releasing the results for the fiscal year ended May 31, 2008 at our traditional year end analyst meeting on July 21 in New York. At that time we should be able to provide more details about the European acquisition which I referenced and also be able to provide more detailed outlook for our 2009 fiscal year. While we will not provide much in the way of future year outlook on this call, we are comfortable in forecasting another year of record sales and earnings growth from the RPM operations. At this time Ernie Thomas and I will now be pleased to answer any questions you have about our third quarter or the outlook for the balance of our 2008 fiscal year.

Your first question comes from Ivan Marcus - KeyBanc Capital Markets Ivan Marcus – KeyBanc Capital Markets: Nice quarter. In your release you said that you’re starting to see some weakness in the industrial side and some of the North American construction markets, where are you seeing that and could you give a little more detail on it?

I think our concern is more forward-looking in terms of weakness in, or potential weakness in commercial construction activity which is aside from heavy industrial activity. We still are doing quite well both in North America and globally in petro-chemical, offshore oil, chemical, you name it, power generation, marine areas are all doing quite well for us. But in particular I think we have some concern about a slowdown in commercial new construction in North America. Having said that I don’t think that there was the over-building or the unique problems in the commercial construction market that has plagued the US residential markets. So if there is weakness it will impact certain of our businesses but certainly not to the extent that the residential housing market has impacted the overall economy. Ivan Marcus – KeyBanc Capital Markets: Great thanks. Another question is a lot of your competitors are reporting that they’re seeing really weak sales in their DIY markets except for you guys, you’re doing very well. What do you think is the main driver behind the success of I guess Rust-Oleum would be the main product in there?

I think there are a couple of reasons as to why we’re doing better. Number one, the general makeup of RPM from a strategic perspective and it’s been true for 30 years, we are not directly involved in house paint, automotive coatings or big OEM and so we have deliberately avoided some of the bigger volume more cyclical product areas of our industry and so that’s helped us. Certainly the residential housing market situation in the United States is not good. And so in comparison to some competitors who have a bigger presence in direct house paint, I think you would expect our results to be better just because of our product makeup. Secondly and we’ve been talking about this since our first quarter, if you go back to August, we had some higher SG&A spends in the first quarter; didn’t leverage our typical sales volume to the bottom line because we’ve been working on some new product introductions. We launched with our DAP subsidiary, a sealant called 3.0. We’re pretty excited about it. We just now have a full distribution across our distribution base. It is a proprietary formula. It’s got silicone characteristics but it is paintable. It is not silicone. Most importantly it cures in three hours as opposed to the typical 12 hours or more of most caulks and sealants and so it can be applied in the morning and repainted in the afternoon. It is great for bath and kitchen areas because again you can apply it and then it won’t wash out as some caulks and sealants do. The outdoor aspects of it also are applyable in lower temperature conditions. So we’re very—I could go on and on; we’re very excited about it. It is a higher priced product. It’s a higher margin product and it’s something that we and our customers are excited about. Likewise at Rust-Oleum we’ve been working on a new spray paint launch for the year. We just launched it last month. It will be in full distribution some time in early to mid July. It’s a product called Universal. It is a patented spray device which is new to the spray paint market and more importantly it is a new paint that has great adhesion to any substrate, whether it is plastic, masonry, metal, wood, you name it. Also a higher ticket item, higher margin and something that we and our trade customers are very excited about and that should continue to rollout between now and the middle part of July. Ivan Marcus – KeyBanc Capital Markets: Great, Ernie passed over this and I just missed it, and the lawsuit settlement on the industrial side, what was that about and what was the cost?

That was approximately $1.6 million impact on us in the quarter. It was a—we’re under a confidentiality agreement as are all the defendants. It was basically a major building construction lawsuit which hit a number of defendant companies who were material suppliers of various materials and it impacted one of our companies that is involved in the commercial construction business. Ivan Marcus – KeyBanc Capital Markets: So that’s a done deal; you’re not going to see that recurring.

That’s a once and done deal and it was a major construction lawsuit that impacted multiple defendants and we were one of them. Its once and done and it’s over. Ivan Marcus – KeyBanc Capital Markets: Great, one last question. I saw that on your balance sheet your allowance for doubtful accounts bumped up a little bit. Are you seeing customers of yours having a hard time paying your bills in North America or is that just a result of more business?

I think it’s just a function of timing and more business. I’m not aware of any particular situations that would drive that but if we find, we can get back to you. Ivan Marcus – KeyBanc Capital Markets: Great, thanks a lot. Great quarter.

Your next question comes from Kevin Mccarthy - Bank of America Securities Kevin Mccarthy – Bank of America Securities: Frank, we’ve seen acquisition activity pick up here a little bit, Prosytec and Increte, and it sounds like you’ve got another $80 million sales deal to come. Can you comment on the valuation multiples that you’re seeing in today’s market versus what we might have witnessed a year ago before the credit market dislocations?

That’s a great question and I’ll give you a somewhat funny answer which is, for probably 30 years and our acquisition program was really started and built by my father, we have valued businesses pretty much the same way. And we’ve gotten more sophisticated perhaps in what we can do with businesses by integrating them into some of our existing companies. So a year-and-a-half or two years ago, especially on bigger transactions, our valuation thinking was low by maybe 20% or even 30% versus private equity values or the values and expectations that private equity activity was creating in the marketplace. We haven’t changed our valuation thinking and so in this environment our valuation thinking might be at the high end and so we haven’t changed a lot. I think the broad answer to your question though in the marketplace is there’s been a significant drop in valuation thinking. The nine, 10, 12x EBITA values are gone. I think that they’re going to be gone for a long time. They never made sense for strategic buyer and they only made sense for financial sponsors in an environment where they could get very low cost of capital debt with virtually no covenants. And that era is over, at least for so many years. The other element that we see coming is that there is still on larger deals, a gap between seller expectations and buyer valuation thinking or in some cases even buyer ability to finance transactions and I think that gap will be bridged ultimately by capitulation because some of these bigger transactions out there are either not going to get done or they’re going to get done at lower valuations. The last comment I’ll make on that is that we are seeing some private equity firms looking to offload some assets at decent values to generate liquidity. And so we think that the M&A market for the next couple of years should be favorable to companies like RPM and with the recent financing we did we think we’re in a pretty good position to take advantage of that when it’s right. Kevin Mccarthy – Bank of America Securities: Okay and just a quick clarification on the pending $80 million deal in Europe, is that on the consumer side or industrial?

It’s on the industrial side and we’ll provide more details in July. It’s a—due diligence is essentially done and we would expect to close it in the next couple of weeks but as anybody that works acquisition knows deals aren’t done until the money flows. Kevin Mccarthy – Bank of America Securities: Sure and then Frank, at the very top of your opening remarks you mentioned you saw or posted good results despite a slow start to the quarter in December, where did you see that slow start and what changed in January and February and why do you feel it might have changed?

A couple of things; as you’ll recall on our January conference call we were trying to tamp down expectations for our third quarter and it turns out it wasn’t necessary but our original plan for the third quarter was a $0.05 quarter. We’ve got a pretty good planning process. December started off quite slowly in a number of our industrial businesses. We had not yet launched some of the new products that we had talked about and those have been launched now. Some of that is just a function of timing, I mean to the extent that they were launched at the end of February, it helped our third quarter and had they not been—made it in February they’d have made it in March and there’s still more to come on the Rust-Oleum side. So I think those were the factors but December was a poor month kind of across the board. The last time we went through a recession, kind of a post-911, post-dot com bust, in our consumer businesses and in a couple of our industrial businesses it was not uncommon to see choppiness from one month to the next where activity would slow down and then it would pick back up. And so I would expect in the next year that we will see a month or so that doesn’t look very good and we’re going to keep fighting through it. Kevin Mccarthy – Bank of America Securities: And finally maybe a bit difficult to comment on, but I was wondering if you have any updated thoughts on the timing of the Judge’s ruling in the insurance overage case?

I don’t, other than I pray that she makes a timely decision and a good one. Kevin Mccarthy – Bank of America Securities: Okay, thanks and good luck to the Tar Heels this weekend.

Your next question comes from Jeff Zekauskas - JP Morgan Securities Jeff Zekauskas - J.P. Morgan: A few short-answer questions, of your 3.9% in organic growth, how much was price and how much was volume?

Volume was 1.2%, pure volume in the industrial segment. You’re asking overall or just the industrial segment? Jeff Zekauskas - J.P. Morgan: Well actually I’d love to hear it overall and then by segment, both industrial and consumer.

Overall, we had pricing 1.1% actually for pricing. Jeff Zekauskas - J.P. Morgan: And for the individual segments?

In the industrial segment, the pure organic volume growth was 1.2%. Jeff Zekauskas - J.P. Morgan: Okay and how about consumer for the volume growth?

Consumer was higher overall; we had 4.6% organic growth. We actually had price discounts in the consumer segment; 1% overall. Jeff Zekauskas - J.P. Morgan: And you still made such progress on your gross margin.

As Frank mentioned though we had the new product launches, they were very strong. [inaudible] and repair aspect of what we sell. Jeff Zekauskas - J.P. Morgan: How much floating rate debt do you have?

Floating rate debt is about one-third of the total debt is floating rate. Jeff Zekauskas - J.P. Morgan: So $300 million?

Yes, $381 million.

Let me correct something there Jeff, in the consumer segment organic growth was 4.6%. In terms of where we are it was actually 6% if you adjust out the Bondo divestiture. And we had positive price growth in the consumer segment. We’re getting price increases across the board. The challenge that we have continues to be getting price increases sufficient to cover our cost increases so I think Ernie’s comment there was the differential on our consumer segment between pricing we’re getting and the raw material costs. So we saw at that level, at the prime margin level, about a 1% deterioration which again we are continuing in all of our product lines to battle the raw material price increases versus our own price increases. Hopefully that’s helpful. We had a very strong quarter, again ex-Bondo; we had 6% organic growth for the consumer segment in the quarter. Jeff Zekauskas - J.P. Morgan: Right so of the 6% organic growth excluding Bondo, what was price and what was volume?

It was about 1% price and the balance was volume. And the differential that Ernie mentioned was really the differential at the prime margin level which we pay a lot of attention to between raw material prices coming in and what we can get going out. Jeff Zekauskas - J.P. Morgan: So your sequential interest expense really dropped down quite a lot and dropped down a lot relative to your floating rate debt. Is sort of $9.5 million your ongoing quarterly number for interest expense now? Or was there something unusual about the third quarter number?

I think it will be a little bit higher going forward. We replaced floating rate debt with a 6.5% coupon fixed rate debt and so you’ll see for the fourth quarter as well as for fiscal ’09 a slight increase in our interest rate. We were up until the bond deal, about 50-50 between fixed and floating and we are certainly much different than that post this $250 million bond transaction. Certainly we hope over time we’ve got plenty of liquidity that we are likely to keep funded on a short floating rate basis any acquisition activity that we have in fiscal ’09 including this pending $80 million transaction. So depending on acquisition activity that mix will change as an average percent of interest expense. Jeff Zekauskas - J.P. Morgan: So does your average cost of debt go back up to about 5.5% in the fourth quarter?

I don’t—we can get back to you on that, we don’t have that exact number right now.

But rates could come down further also.

But if you take a look at our balance sheet and that information is available in our Qs and Ks and our last Annual Report, you can see the pieces and parts and then you’ll have to adjust on about $1 billion—it’ll be about $1.1 billion in debt post this acquisition for the $250 million 6.5% bond. Jeff Zekauskas - J.P. Morgan: Why was your tax rate 22%? Or what was different about the third quarter from the second quarter where your rate was 1,000 basis points higher?

It’s primarily a smaller quarter on an income basis so the discrete tax benefit items have a bigger impact.

We had a one-time event again with a refund at the state level in this third quarter. It was not as big as the tax item that we had last year in the third quarter and it is just a pure coincidence that we ended up with what I think this year was a state-level refund versus a larger refund last year and that’s the principal reason. It was one-time and as Ernie indicated it was a smaller quarter and so it has a disproportionate impact. For the full year I think the right way to think about our tax rate is in the 31.5% to 32% range. Jeff Zekauskas - J.P. Morgan: So how much was the tax item?

I don’t know off the top of my head. It was a state-level item and I don’t know what it was. It was less than last year’s. Last year it was $2.1 million.

I believe it was around $2 million Jeff but I’ll verify that. Jeff Zekauskas - J.P. Morgan: That’s helpful. What’s the CapEx for the year?

We haven’t changed the guidance for CapEx. It’s still around $75 million. Jeff Zekauskas - J.P. Morgan: You’re going to hit that? You only have one quarter to go.

Well we expect to have a lot of backend loaded expenditures so we’ll maintain that same guidance. Jeff Zekauskas - J.P. Morgan: Also, what about year-over-year, what were your depreciation charges last year and this year exclusive of amortization if you have that? I’m sorry to be so detailed.

Depreciation excluding amortization—let me get back to you on that one. I don’t think we have a breakout. Jeff Zekauskas - J.P. Morgan: Okay and then lastly can you talk about what’s happening to raw material cost inflation for you? Is it more of an issue than it was before, do you feel you need to go to your customers for more price or are you pretty content with your raw material conditions as they are right now?

It’s a challenging market Jeff, and I think you’re seeing that from everybody. It is a different dynamic than three years ago. Three years ago you were looking at a combination of global demand that was increasing dramatically and also the impact in North America of the hurricanes which—the combination of which allowed raw material suppliers to drive through significant price increases and absolutely with the attitude of “if you’re not going to pay them, they’re not going to ship” because they were capacity-constrained. It’s a different environment today. There are obviously renewed underlying input costs that have continued to rise and in some cases dramatically. But the impact of supply and demand has also changed pretty differently from three years ago so we are seeing some instances where there have been announced raw material prices increases of 10% or 12% and what’s getting passed through is 2% or 3%. We’re seeing a few instances where there are strong pass-throughs of raw material price and we’re actually seeing instances in some raw materials where they’re remaining flat or actually going down related to supply and demand issues, capacity issues as opposed to underlying input costs. So it’s a choppy time in terms of what’s happening with raw materials, but it’s a different dynamic than existed three years ago, principally because the demand side is not what it was three years ago.

Jeff, depreciation was $46.2 million. Jeff Zekauskas - J.P. Morgan: Is that for the nine months?

Correct. Jeff Zekauskas - J.P. Morgan: And what was that in the year-ago period?

We’ll get back to you on that. Jeff Zekauskas - J.P. Morgan: And then lastly, when I look at your consumer sales growth, its just so strong relative to everybody else’s and I know you were modestly saying that your markets are a little bit more stable, but are you taking share and if you are taking share, in which areas?

I’ll kind of reiterate the comments is that first and foremost the makeup of our products is different from a lot of the peers that we get compared to. We’re not in house paint and a lot of our peers that have very strong presence there are being impacted by that dynamic, specifically of new residential housing construction and of housing turnover. Certainly that impacts us but no where to the extent that it impacts people that have more of a peer play there. Secondly a lot of our product lines are patch and repair related and so if you’ve followed RPM for as long as I know you have, whether it was in ’90, ’91, and 2001 a number of those products tend to ride through recessionary periods quite well. They tend to be small ticket items and they tend to be items that people buy perhaps even more of when they’re maintaining or fixing their home. And then the last area which I also referenced was new product introductions. We’ve been talking since the first quarter about some ad spends and developmental costs for some new product introductions. They came out over—started over the third quarter and they’ll extend through the fourth quarter and so we’ve got a nice sell-in, we are picking up some market share in the caulks and sealants and patch and repair area. I think that we are maintaining what is a very strong market share in small project paint and spray paint and that the increased sales that we have there is really about these new products which is pretty exciting for us and they’re higher ticket items in both cases. So I think it’s been a combination of the makeup of our products as well as some new product introductions which should be significant for us. The issue there is just going to be POS. We’re excited about these and in the long run they’re going to be great. The fact of the matter is, is what’s impacting us most directly in our consumer business isn’t new home construction, it’s the fact that there are fewer people walking into hardware stores and home centers which impacts across all product lines in those categories. Jeff Zekauskas - J.P. Morgan: Thank you very much, that’s very helpful.

Your next question comes from Edward Yang – Oppenheimer Edward Yang – Oppenheimer: You spoke a little bit about Universal and 3.0, that’s sounds like its more on the consumer side. Product introductions were pretty accretive to growth this year. Looking into next year on the industrial side, do you have any initiatives for new products, maybe on the energy efficiency side or anything else that you could talk about?

We are constantly introducing new products across all our businesses. I mentioned the consumer ones in particular because they have been part of the reason that we’re showing some strength although it’s not great in the consumer market which isn’t in sharp comparison to some of our peers and again its product makeup and some new product introductions. In our industrial segment I think we’re doing quite well in a lot of areas. We’ve made a real push in the last two years in what we call dirty water marine which is harbor areas, Mississippi-river type stuff, barges and we’ve introduced new products. We’ve expanded our sales team and that is going quite well. Our international push across most of our industrial businesses is continuing to grow and has been timely. Obviously both the stronger economy of certain international markets as well as the positive impact of the foreign exchange has helped us well there so I think we’ve been lucky in terms of the timing on a very deliberate expansion over the last five years into more globalizing some of our businesses. And then the last comment is your comment on environmentally friendly or better building products, we’re there. We are the leader in alternative roofing, vegetative roofing, photovoltaic roofing, the War Memorial Museum in Canada was done by our Tremco roofing business, and the new Clinton Library in Arkansas has a vegetative roof that was done by our Tremco roofing business. There are still very small markets—the markets for photovoltaic roofing or vegetative roofing, they tend to be showcase projects because they’re also expensive. We are heavy between Illbruck and Tremco in building envelopes which as issues around global warming become more of an issue should help us and our number one product in terms of building envelope is Dryvit. [inaudible] is still the most energy efficient building ramp or siding out there of all of them and so that should help us as well. Edward Yang – Oppenheimer: And when you tried to sell some of these products on the environmental merits, do your operating businesses go about it separately or do you try to bundle it together and have the Dryvit people and the Tremco people come together and put forward proposals together?

The nature of RPM and it has served us well is relatively entrepreneurial and independent autonomous units so while we operate with five groups, we have 40 plus independent operating companies and for the most part they approach the market independently. We are actually cooperating on a couple of major projects across some of our businesses like some of our Tremco product lines and our Dryvit product line, so I would expect us to see more opportunities like that but those are synergies that are developed between the businesses. There’s nobody at the corporate headquarters who’s responsible for driving that type of synergy. It really kind of goes against the grain of our culture. Edward Yang – Oppenheimer: Okay and you mentioned the SG&A leverage and since 2002 you’ve made pretty significant strides in getting the SG&A as a percentage of revenue down from about 36%, down to about 31% in 2007, since 2007, 2008 the SG&A as a percentage of revenue has crept back up. Looking forward into 2009 and on, should we expect to see more progress on that longer term trend line of reducing some of the SG&A expenses and getting some more leverage?

I think down the road, you’ll be able to see some more leverage and down the road might be over a trend, over a three to five year period. As I commented at the beginning of this year, we’ve been very deliberate in spending this year in our consumer area in particular, with the belief that we could with some new products and some good marketing and the characteristics of our products continue to positively impact our top line and that has worked. You will note in the third quarter even, we have some higher—even excluding the $1.6 million one-time legal settlement, have some higher SG&A and we’re continuing to invest in different initiatives and that will continue so I don’t expect to see a lot of leverage in our SG&A for the balance of this year or quite honestly for fiscal 2009. If the economy picks up and we can accelerate our growth more effectively in a stronger economy and as we grow more international I do think the long-term trend will allow us to incrementally and permanently reduce that SG&A level as a percent of sales. Edward Yang – Oppenheimer: Okay, thank you very much.

Your next question comes from Rosemarie Morbelli - Ingalls & Snyder Rosemarie Morbelli - Ingalls & Snyder: Frank you just made a comment which kind of stopped me in my train of thought, you said that you were not really aggressively working on synergies between the different businesses and my understanding has always been that actually in the past, you had someone at—now that you had the three major groups, you actually put more emphasis on making sure that one division could benefit from another and they would be working on projects. Has something changed in that?

No, nothing’s really changed Rosemarie. We do get more synergy at the group level; we have five different groups. At the point in time some years ago when we started reporting in our two segments, our industrial and consumer segments, I think there was a misperception that we were going to reorganize into affectively two operating groups. That was never our strategy. It was never our intent. It was never done. We still very much believe in independent sales, marketing, product development, customer service, and tech service; all at the individual operating company levels. So that’s in 40 or 50 places throughout the world. That will not change. Paul Hoogenboom, who is our Senior Vice President of Manufacturing and Operations, does drive our purchasing initiatives across all our businesses. He also helps coordinate some manufacturing distribution. He’s our CIO so to the extent that we’ve migrated to fewer ERP or computer systems, he’s led that charge. Then the other area that we’ve strived to do for 30 years is to get our sales people together or get or research directors together. We just had a global research director meeting last week with the belief that if we get these operating company people together the natural synergies will come out. What we don’t believe in is corporate level top down forcing of these types of things because we don’t believe it works period and it certainly doesn’t work in our culture. Rosemarie Morbelli - Ingalls & Snyder: And just as a follow-up have you seen an increase as you get all of those people together, have you seen an increase in the level, let’s call it cooperation?

Absolutely. We’ve seen a tremendous increase over the last five years in cooperative ideas in different areas. Rosemarie Morbelli - Ingalls & Snyder: Okay. Then when you give us the new outlook of 10% to 12% for the growth rate for the year, are you including the impact of that pending acquisition, or is that going to be taking away from the earning side?

The two acquisitions that we just completed, they’re relatively small and the acquisition I referenced that we hope to complete this month—all three of those will actually hurt earnings in the fourth quarter. From an accounting perspective while we can capitalize some transaction costs, some have to be expensed and there’s also an inventory write-up that you have to do with an acquisition when it’s first completed and that is a hit to earnings. And so those will not help us, and the margin will hurt us in the quarter. But they should be accretive to earnings in fiscal ’09. Rosemarie Morbelli - Ingalls & Snyder: Okay so if I understand properly, the 10% to 12% increase in revenues that you are expecting for the full fiscal ’08, includes the revenues, the contribution on the revenue side of those acquisitions but we may not see an increase of 10% to 12% in the earnings side because of what you just referred to—the different costs in the fourth quarter?

That’s correct. Our results in the fourth quarter will be driven by the business that existed at February 29, some of which is some—for instance we acquired Tor I believe in last June so we’ll have the benefits of Tor which is part of our Rust-Oleum business; it’s their first entrée into the [UK] DIY markets and we’re very excited about that. That will be a positive contributor to sales and earnings growth in the fourth quarter. On the sales side obviously acquisitions in the fourth quarter will help sales but they will hurt on a net basis our results at the bottom line. Rosemarie Morbelli - Ingalls & Snyder: Or we could very well see the—I’m sorry to be pushing this but I want to make sure I understand what you are saying. We will see the 10% to 12% in new growth rates that you advertise on your press release, we will see that 10% to 12% on the top line but we will not see it on the bottom line. I was very confused…

That’s not correct. If you use a base of $1.57 for last year which was the result of RPM excluding the one-time asbestos benefit of $15 million pre-tax, use that $1.57 base and we believe our full year results on the bottom line, that’s the right one to focus, will fall in the 10% to 12% earnings growth for the year. Rosemarie Morbelli - Ingalls & Snyder: Okay well so that is pretty good if includes the cost of all of those new acquisitions including the pending one.

We expect to see decent growth both top and bottom line in the fourth quarter but obviously not terrific because we are subject to the same economic conditions and raw material price conditions that are out there. Rosemarie Morbelli - Ingalls & Snyder: Sure, regarding the valuation that you look at in terms of the acquisitions, you said that when everybody was going, willing to pay through the roof for acquisitions, you were at the low end of the valuation spectrum, and now you are at the high end. So considering that obviously the cost of acquisitions is coming down, are you actually lowering what you are willing to pay in order to not be at the high end of what people are willing to pay, or are you still staying—just because this is just what you have always done?

Yes, I think that we’ve always valued businesses based upon what they’re worth to us and what they can do as part of RPM in the future. Fortunately we haven’t found reasons to break away from our valuation discipline when markets are frothy like the last couple of years. And there’s no reason to get cheap. If we find a good acquisition that’s a good fit that will be accretive in the first year, than we’re going to be out there. We’re going to be getting it done on the same valuation basis that we always have. The difference today is, is that we’re much better situated to buy product lines or businesses that we can integrate into an existing business and so while these tend to be small, the IRRs on them are huge and the bottom line bang is terrific. When you can do a couple of product lines or small businesses that might total a $50 million investment and in one year it can add a penny to the whole $3.5 billion nut, that’s pretty good. Rosemarie Morbelli - Ingalls & Snyder: Okay and are you more likely to look at large deals or is that still not part of what you are looking at?

Our focus tends to be on small to medium-sized transactions. I do think that larger transactions which for us would be $200 million, $300 million. We saw either competition from private equity firms or expectations created by private equity valuations that limited us and I think other strategic buyers from being competitive in that space. So I think to the extent that we have an opportunity to do larger deals it will be in that low $2-$300 million range and I think at that point we will be able to get them done and we’ll get them done accretively, cash flow positive and competitively. Rosemarie Morbelli - Ingalls & Snyder: Okay, thanks a lot.

Your next question comes from Daniel Rizzo - Sidoti & Company Daniel Rizzo - Sidoti & Company: One quick question, in terms of you have I think a $300 million in cash on your balance sheet, is that in treasuries? What is that in?

I don’t know the answer to that; it is very conservative and very short-term. It is not in auction rate securities and it’s not in sub-prime mortgages, it’s in cash. A chunk of it we should quite honestly get a better. We have given our structure a relatively unsophisticated cash management system in Europe and we now have the size to get at that more aggressively. So there’s probably $50 million to $70 million of that cash that’s tied up in an inefficient cash management system in Europe that we in tend to free up in the next three to four months with some things that we’re doing there. The balance of it is—of all that liquidity is available to fund acquisition opportunities if we can find good ones at the right price. Daniel Rizzo - Sidoti & Company: Okay, thanks a lot.

Your next question comes from Unidentified Analyst - Goldman Sachs Unidentified Analyst - Goldman Sachs: My first question is related to the raw materials trends, I was wondering have you seen much changes for the ongoing raw materials trends versus what expected three or four months ago?

Amy as I talked about a minute ago, we continue to see significant raw material price increase pressure but the dynamics today are a little bit different because there are certainly underlying input costs rising through raw material suppliers, but in a number of areas the demand is weakening and so while we’re seeing some raw material price increases, they tend to be half of what suppliers are trying to get. But it’s a real mixed bag. There are some key raw materials where we’re seeing flat pricing or actually some declines and there are some raw materials that are getting significant price increases. So it’s a choppy market out there but it’s a different dynamic than it was three years ago when a combination of very strong global demand and tight capacity in part related to the hurricane impact on the US chemical industry really allowed raw material suppliers to need and to get huge price increases without which they just wouldn’t ship because they didn’t have the capacity. That is not true today. Unidentified Analyst - Goldman Sachs: Okay and the reason why I asked this question is that one of your major competitors pre-announced I think one or two weeks ago and then they revised their raw materials cost outlook for the whole year—at least for the quarter. So I’m not sure have you done so? Are you going to update your raw materials cost outlook?

We will update our raw material outlook as well as provide an outlook for our new fiscal year which starts June 1 in much more detail on July 21st in New York when we release our year end earnings and have our traditional analyst call. Unidentified Analyst - Goldman Sachs: Okay so so far your raw materials is staying the same?

Well again, they’ve been very volatile but we’ve been in a battle between our ability to get price increases sufficient to cover the raw material price increase that we’ve been dealing with. Part of it also is a product mix issue. Unidentified Analyst - Goldman Sachs: Okay, I think at the beginning of the Q&A you noted some softness in the commercial construction market, I was wondering if the growth trends for that market is still positive or where do you see some negative trends there?

I think the growth trends there are still positive but we follow some of the financing markets and we tend to be a lagger in those segments of our business typically related to our Tremco Sealants business, Euclid Chemical and to a lesser extent Dryvit. We tend to be a lagger there because projects that were on the board and funded are getting done and the thing that has up a little bit nervous is really an outlook over the next six months as to what will be coming, or what will not be coming relative to commercial new construction and we’ve taken a hard look at it and the one comforting thing as I mentioned earlier, is that the dynamics of commercial construction were not as over built and not as dire and so they’re not likely to lead to the type of real wipe out that’s happened in the residential housing market here in the US in the last 12 to 18 months. Unidentified Analyst - Goldman Sachs: And then for the full year outlook, the demand outlook from commercial construction, would you expect something like mid single-digit growth?

We’ll provide our outlook for the full year on July 21. Unidentified Analyst - Goldman Sachs: Okay, thank you very much.

Your next question comes from John McNulty - Credit Suisse John McNulty - Credit Suisse: Just one or two quick questions, with regard to a lot of the new products that you’re launching in the consumer area, can you give us a rough idea of how your shelf space at the DIYs would be changing in terms of potentially going up and what kind of percentage growth in shelf space you might be seeing?

I don’t know that. I just don’t know that. We can get back to you on that but I don’t know exactly if we’re gaining shelf space in feet. I know for instance some of the—what I can tell you is some of the new products have gone on floor displays so it’s totally new space. But how that will shake out over the next year in terms of where it fits permanently on shelf I don’t know. John McNulty - Credit Suisse: And then the other question, with regard to inventory kind of what you’re seeing at your customer levels, how much—I guess first of all how much insight do you have to that and then what kind of inventory levels are we looking at. Are they relatively lean at this point or they kind of normal or what would you say we’re at?

At the consumer level we have real good insight into that and I think that they tend to be—except for these new products which we’ve just launched and so we’ve got to get the pull through, they tend to be at normal levels. In some instances in some of our core small project paint areas, they tend to be normal to lean. And so there isn’t anything that we would anticipate—there isn’t anything about inventory levels we see on the consumer side that suggests that there’s too much in the pipeline; if anything it’s the opposite. On the industrial side it’s really hard to say. I mean we’re selling through thousands and thousands of distributors and it’s really a function of project work where we have a type of big lookout for work, inventory and in our industrial segment, particularly in the heavy industry stuff, our outlook continues to remain strong. John McNulty - Credit Suisse: Okay great and then just with the recent acquisitions, can you remind us what your geographic mix is by segment, by industrial and consumer?

I don’t have it by industrial and consumer. I can tell you that as of last year, May 31, 75% of our revenues were in North America and 25% were elsewhere. Of that 25% elsewhere about 15% of it was in Europe. Prosytec was a European transaction, this $80 million transaction I referenced that we hope to complete this month is European based. And so that tends to be it. Most of our business outside of the United States and Canada is industrial. The exception to that is about $150 million of MRO or now new, relatively small but new consumer products that are part of our Rust-Oleum Group. And that is all European based; the consumer piece. John McNulty - Credit Suisse: Okay great, thanks a lot.

Your next question is a follow-up from Jeff Zekauskas - JP Morgan Securities Jeff Zekauskas - J.P. Morgan: Just a quick question, I take it that you had an extra day in the quarter?

Yes we did. Jeff Zekauskas - J.P. Morgan: Versus last year?

We had an extra day in the month; we’d have to go back and look at where holiday’s fell and whether that helped us or hurt us by an extra day but like everybody we had a leap year which was always fun. Jeff Zekauskas - J.P. Morgan: So is that a penny or two benefit?

I couldn’t tell you. I honest to God Jeff couldn’t tell you and again I wouldn’t be surprised if we had a day less—again we’d have to go back and look at holiday schedules and where Christmas and New Year’s fell. But if we add an extra shipping day—to the extent that we had a stronger quarter it had to do with the beginning of a rollout of new product introductions and made up for what was a rough December for us as I talked about in January and referenced earlier in the call. We did not have a good start to the quarter and that was the reason for my conservative outlook for the quarter when we talked to investors on our January call. We had a strong quarter and in comparison to some of our peers, I’m pretty proud of what our people have done and I think the makeup of our product lines and the small project nature patch and repair or otherwise is really the principle reasons that we’re doing better in some instances because we have a product line makeup that’s been around for 30 years that tends to do better in challenging economic times. So I would attribute that to the reason that we’re doing well, not a leap year extra day in February. Jeff Zekauskas - J.P. Morgan: Okay, thank you very much.

Your next question comes from Greg Halter - Great Lakes Review Greg Halter - Great Lakes Review: You just alluded to the fact that December was a slow month; we’re one month into this quarter, any indication on where you stand or stood for March?

Not really. Other than the outlook that we provided, which is our expectation that we will have another record quarter for this fourth quarter. But it’s a mixed bag out there. We expect positive results out of our consumer businesses for the quarter and obviously positive results out of our industrial businesses, although as I referenced we’re still positive on the commercial side but we’re seeing that slowing down. But obviously our outlook for the quarter is pretty decent given the increase in our guidance. Greg Halter - Great Lakes Review: Thank you very much.

There are no further questions; I would now like to turn the call back over to Mr. Frank Sullivan for closing remarks.

Should you have any follow-up questions today, please feel free to contact Kelly Tompkins, RPM’s Executive Vice President and Chief Administrative Officer, Ernest Thomas or myself. We’ll be available throughout the day and this week. I’d like to close by thanking our worldwide associates. The employees of the RPM operating companies have done a great job of performance and perseverance during a tough economic time and continuing to deliver record growth in this environment. I believe it’s a testament to our strategy and the makeup of our product lines but most importantly to the efforts of our employees. Thank you for participating on our conference call today and for your interest in RPM. We look forward to delivering the results of our full year and to seeing many of you in New York for our year end analyst meeting on July 21. Thank you very much, have a great day and go Tar Heels.