Mark Belgya - CFO Tim Smucker - Chairman and co-CEO Richard Smucker - President and co-CEO Vince Byrd - SVP of Consumer Market Steve Oakland - VP and Gm of Consumer Oils and Baking Business Mark Smucker - VP International Paul Smucker Wagstaff - VP of Food Service and Beverage Market

Chuck Cerankosky - FTN Securities Christina McGlone - Deutsche Bank Farha Aslam - Stephens Eric Serotta - Merrill Lynch Jon Anderson - William Blair

Good morning and welcome, ladies and gentlemen to the J.M. Smucker Company's third-quarter 2008 Earnings Call. I will now turn the conference call over to Mr. Mark Belgya. Please go ahead, sir.

Good morning, everyone, and welcome to the J.M. Smucker Company's third quarter 2008 Earnings Call. I am the company's Chief Financial Officer. Thank you for joining us this morning. Also on the call from the company are Tim Smucker, Chairman and co-CEO; Richard Smucker, President and co-CEO; Vince Byrd, Senior Vice President, Consumer Market; Steve Oakland, Vice President and General Manager, Consumer Oils and Baking; Mark Smucker, Vice President, International; and Paul Smucker Wagstaff, Vice President of our Foodservice and Beverage market. After this brief introduction, I will turn the call over to Richard for opening comments. I will then review the financial results for the quarter and Tim will provide closing remarks. At the conclusion of these comments, we will be available to answer your questions. If you have not seen our press release, it is available on our website at Smuckers.com. A replay is available on the website in downloadable MP3 format. If you have any follow-up questions or comments after today's call, please feel free to contact me or Sonal Robinson, Director of Corporate Finance and Investor Relations. I would like to remind you that certain statements in this presentation and during the question-and-answer period that follows, may relate to future events and expectations and as such, constitute forward-looking statements within the meaning of the Private Securities Legislation Reform Act of 1995. I invite you to read the full disclosure statement concerning such forward-looking statements in the press release. I also want to point out that the company uses non-GAAP results for the purpose of evaluating performance internally. Additional discussion on non-GAAP information is also detailed in our press release. With that, I'll turn the call over to, Richard.

Thank you, Mark. Good morning, everyone, and thank you for joining us. I would like to begin by summarizing the key highlights for the quarter. First, we achieved strong sales growth in the quarter. Our Eagle and Carnation acquisitions contributed approximately one half of the growth, consistent with our strategic expectations. The remaining sales gains were led by our Smucker's, Jif, Crisco, and Pillsbury brands. While pricing contributed to the increase, volumes were up across most of our brands. Second, we increased our non-GAAP earnings per share by 10%, despite raw material costs that were up approximately $40 million over the same period last year. Third, we completed a successful fall bake in both the US and Canada, realizing gains in sales, volume and market share. And finally, while we are attentive to cost management in this difficult environment, we once again increased marketing spending, demonstrating our focus on long-term brand building. Let me briefly comment on our performance starting the US retail segment. The segment experienced strong top line growth in the quarter. In the consumer's area Smucker's, Jif, and Hungry Jack brands all contributed, and Smucker's Uncrustables remained strong. A particular note, this quarter delivered good volume growth. One of our best quarters ever, in terms of tonnage. Our spreads businesses continued to set new share market records, quarter-after-quarter. Fruit spreads and peanut butter, continue to be a very strong combination, marketing them together is appealing to our consumers, beneficial to our customers and has strengthened both brand. One of Jif's competitors, who has been out of the market for sometime, aggressively moved to regain their lost share of market, with significant trade and consumer spending during the later part of the quarter. And we expect this activity to continue for the foreseeable future. While the dynamics of the category remain volatile, we have continued to gain share. While the addition of Eagle contributed significantly to sales growth in the oils and baking area, we had another strong quarter from Pillsbury. Since our baking acquisition several years ago, you've heard us talk about the long term actions we were taking to build the brand, actions in the areas of reformulating and repackaging, new product development, focusing distribution on more profitable channels and providing significant marketing support. While we did not immediately realized sales and share gains we knew that our strategy was sound. And our long term brand building focus would prove beneficial, as a result of these investments. Therefore, the Pillsbury brand has realized four consecutive quarters of sales gains, and has grown market share over that period. Our steady stream of new products has also contributed to the improvement. We recently introduced Pillsbury Reduced Sugar Cake Mixes and Frostings. They've been very well we receive by consumers, and we are expanding our offering with new varieties. The ability to cross promote in the baking aisle has also been beneficial for our brands. Crisco volumes and share of market were flat in the quarter, while sales were up on higher prices. Pricing in the oils category remained volatile, as soybean oil cost continue to rise, reaching their highest levels ever during the quarter. As a point comparison, the current price of soybean oil has more than tripled since we acquired the business six years ago. We have implemented four separate price increases totaling over 50% in the past 13 months. Based on soybean oil futures we expect these cost to remain high and we plan to reduce cost and take price increases as appropriate. Turning to our special markets. This segment experienced another good quarter in sales and their overall profit growth continues to improve. In Canada, the Eagle and Carnation acquisitions added significantly to the top line growth, and we also benefited from favorable exchange rates. Although we just closed the Carination acquisition on October, we reached a key integration milestone this month, allowing Carnation products to be ordered, shipped and invoiced along side other Smucker products. In addition, we were able to include Carnation in some of our Fall Bake campaigns, cross promoting with Robin Hood. Results for Carnation have been strong, exceeding our expectations. Food service also was a key contributor to the segments growth, as sales were up in both the traditional and the schools channel. The business also benefited with the addition of Eagle. In summary, we delivered a strong quarter. As we look ahead to the next several quarters, we expect most costs to remain high. But as always we are committed to responsibly managing our business for the long-term. We expect a strong focus on our strategy to continue to generate long-term profitable results. I would now like to turn the call back to Mark to have him review the financials with you.

Thank you, Richard. Sales were up 27% for the quarter, and excluding the impact of Eagle sales were up over 14%. This increase in sales was primarily attributable to price and volume gains with foreign exchange and Carnation also contributing. As Richard noted, the peanut butter competitor that had been out of the market began to aggressively move to regain share in the quarter, through this [just] gained share and once again realized good sales growth up 13% over the same period last year. This month marks a full year of the competitor's temporary exit from the market. Now that we have left the benefits we realized for the past year, we do not expect peanut butter sales to continue to experience the level of year-over-year increase as we have enjoyed, and are expecting a return to more historical growth level. GAAP earnings per share were $0.75 this quarter and $0.71 in the third quarter of last year, including restructuring and merger and integration costs which were primarily Eagle related. Excluding these charges in both years', earnings per share was $0.79 this quarter and $0.72 in last year's quarter, a 10% increase. Operating income increased almost $8 million for the quarter, excluding charges but declined as a percent of sales from 12.4% to 10.9%. Gross margin for the period decreased approximately 380 basis points excluding charges, primarily reflecting lower margins in the Eagle business, the impact of higher soybean oil and weak cost, and mix of sales. Magnitude of the increase in milk cost and a higher percentage of non-branded versus branded sales, contributed to Eagle's lower than average margins during the quarter. Looking ahead, we expect significant operating margin improvement for Eagle with a better sales mix, lower milk cost and synergies. While the impact of pricing action across all of our businesses essentially offset higher raw material cost, they were not sufficient to maintain profit margins. However, consistent with our brand building efforts, our marketing cost increased 17% compared to last year. Corporate overhead expenses increased only 3%, well below the top line growth rate as we were able to integrate our recent acquisitions essentially within our existing corporate infrastructure. As with our first two quarters, SG&A as a percent of sales declined from 20.8% to 18.5%. Now turning to segment results. Sales in our US retail segment were $502 million in the third quarter. Excluding the addition of Eagle, sales for the segment were up 13% as were sales from both the consumer and oils and baking areas, as compared to last year. In the consumer area, gains were broad based, as peanut butter, fruit spreads, potatoes, pan cakes, syrups and uncrustables, all contributed. Sales among crustables across all channels increased 25% for the quarter. Sales in the oils and baking business increased due to growth in baking mixes, flour and frostings, and pricing actions particularly in oils. In the special markets segment, sales were $163 million for the quarter, up 26%. Canada contributed three quarters of increase, primarily due to the impact of the acquired Eagle and Carnation businesses and favorable exchange rates. Food service was up 8%, excluding Eagle, with gains in both the traditional and schools channel. Sales in our beverages business were flat compared to last year. Our tax rate for the quarter decreased to 31.8% from 33.1% in the third quarter lat year, primarily as a result of statutory tax law changes and an increase in tax exempt interest earnings. For the full year we estimated an effective rate between 33% and 33.5% compared to our current year-to-date rate of 33.9%. In January, we announced the repurchase of approximately 1.6 million shares during the third quarter at a cost of almost $83 million. This included 1.5 million share acquired as a part of 10b5-1 plan. This latest repurchase essentially exhausted the shares outstanding under previous authorizations. As a result the Board approved an additional 5 million shares for future repurchase at its January meeting. I would now like to turn the call over to Tim.

Thank you Mark, and good morning everyone. As Richard mentioned we had another strong quarter with sales and share market growth across our brands, delivering good earnings growth. As you know, these are unprecedented times, in terms of rising cost and related pricing actions, which make our results for the quarter and year-to-date particularly gratifying. It all comes down to execution of strategy, out attention to detail and focus on building our brands for the long-term. Last quarter, we forecasted a year-over-year increase in cost of $150 million and remain comfortable with that estimate. We have reduced cost, where possible, and taken price increases where appropriate. We remain enthusiastic about our growth prospects. We continue to support our brands, as evidenced by the significant increase in marketing spending, every quarter this year, compared to last year. In addition, our new product activity remained strong. Our Jif snack nuts, a natural expansion of the Jif brands are doing well in test markets. And we continue to increase our distribution of Crisco olive oil, expanding our presence in growing segment of the oil category. This quarter we launched whole wheat Smucker's Uncrustables, and have extended our Hungry Jack brand into two new categories, with the introduction of Hungry Jack Frozen Biscuits and Hungry Jack Refrigerated Potatoes. We are introducing Crisco Canola oil fortified with omega-3 capitalizing on the growing consumer interest in that ingredient. Finally, we have several new Smucker's toppings planned for this year's summer ice-cream season. Our momentum remains strong. We always take a long-term view of managing our brands, and remain confident in the opportunity for profitable growth that they offer. So in summary, we continue to implement our strategy. Second, we delivered a record quarter with good sales, share and earnings growth. Third, we completed a successful fall bake. And finally, despite a challenging cost environment we remain enthusiastic about our opportunities going forward. In tough economic times, the comfort, cost and convenience of a peanut butter and jelly sandwich, gains even greater favor with our consumers. And our portfolio of brands are well positioned as families look to time tested foods at home. On another note, we mentioned in our press release that we recently had incurred storm related losses. Our Memphis warehouse facility operated by our distribution partner DSC Logistics was destroyed in the severe weathers striking the Memphis area earlier this month. We expect insurance coverage to especially cover our losses and do not expect this to result in a significant business interruption. However, the event has had a greater impact on our business partner. We extend our condolences to the individuals and families affected by this tragedy and we continue to provide assistance as needed. As always we thank you for your time today and are now happy to answer any of your questions.

(Operator Instructions) Our first question comes from Chuck Cerankosky of FTN Midwest. Chuck Cerankosky - FTN Securities: Good morning, everyone. Can you hear me alright?

Yes, Chuck.

Alright, thank you. In looking at the business here, especially with regard to price increases I noted, in here you talked about the ability to generally offset the higher raw material costs with price increases, but you weren't able to increase your margins. Could you talk about that a little bit, and I know you perhaps are getting into a period here where margins are going to be under pressure but you can maintain traditional gross profit spreads as measured in dollars?

Chuck this is Mark. I'll start off and then you guys can add in. It's clearly what you're suggesting. You know you see cost in the times that are certainly unique, we are trying to cover all our lost margin in dollars and then basically this has been looked at as the dollars sales increase through pricing is coming to dollar at cost. So we would expect over time that although we will be able to pass price, [keeping] dollars [tucked] and our overall margin percentage will decline or at least stay where it's at. Chuck Cerankosky - FTN Securities: Well when can you say private label is having its biggest impact as customers see higher shelf prices?

We passed the increases on oils in the 30% range and power on the 23% range. So those are significant. Those are going to hit the shelf sometime here and I think that's what we'll see. Fortunately our private label competitors are facing the same cost we are being. You know most of them don't have the benefit of the hedging organizations that we have. So I think we're all going to be in the same boat. It's going to be really up to the customer, are they going to - you know all these new price points make that big of a difference. But as ingredients become a larger percentage of your total costs, there's simply not a lot of room for private label to reduce their margins or their other operating costs. Really some of these items hits the fall ingredient right now that's driving the price. Chuck Cerankosky - FTN Securities: Can you say that last part again. I'm sorry I missed it.

I just said that in some of these invest oil or flour, some of those businesses it is the raw ingredients driving the new cost, the new shelf prices. So shouldn't be much of an opportunity for private label to be more competitive than they have been in the past.

We haven't - this is Richard. We haven't seen the spread between private label and branded really change that much because of the factors that Steve mentioned. Basically everybody is in the same boat, so the spread between private label and brand is very similar to what it's has been historically.

I would say Chuck this is Tim, sorry. That if you look at the spread business, the gaps have widened a little bit, but what tends to happen is just a lag. And that's not unusual from history, and I think that's consistent with other categories that tends to be a three months or maybe a six month lag of private label moving on. Chuck Cerankosky - FTN Securities: Alright. And did you mention that the beverage category was flat. Are you seeing customer pushback in that category?

Hi Chuck, Paul Wagstaff. On the beverage side while we are flat, I think overall there has been some minor ingredients shortages on organic apple which has contributed to some of our slowdown or flatness I would say. But overall we've been pass on prices to our customers. Chuck Cerankosky - FTN Securities: Alright. And then, last question, can you sort of quantify the benefit you had from the Canadian dollar being strong?

Yeah Chuck. Of the 14%, top line growth is about 2%. Chuck Cerankosky - FTN Securities: Two percentage points, so you say fair -.

Alright. Thank you very much.

We'll go next to Christina McGlone of Deutsche Bank Christina McGlone - Deutsche Bank: Good morning

Good morning

Morning, Christina. Christina Mcglone - Deutsche Bank: Mark, could you also breakout the price in the volume component of sales, because it's great to see to volume growing?

Yes. Let me just reconcile, Christina for you. We said that without Eagle we were up 14% top line, of that 14%, roughly 2% was foreign exchange, 2% was the effect of Carnation. So that let the base growth of about 10%, roughly two thirds of that would be price and the remainder of volumes. Christina Mcglone - Deutsche Bank: Okay. Thank you. And in last call you had said of the $150 million increment on commodity costs, that you would be able to recruit the majority of it with pricing. And it looks like your pricing trailed the cost this quarter. I did know if it was timing or if maybe you've changed the expectation of being able to fully recover that incremental costs?

It's primarily timing just -- when price increases are going to be affective. Christina Mcglone - Deutsche Bank: Okay. So we should see a catch up buy the end of the year?

Yes. Christina Mcglone - Deutsche Bank: Okay. And then, would you be able to tell us how much of that $150 million is hedged so or basically how much visibility do you have on that?

Christina this is, Steve Oakland. I mean all of our core commodities are hedged. I mean wheat, soy, and anything that we're not hedged and we have fixed price contracts, and maybe to follow-up on your previous question. Milk is a little different in that and it's not no pun attended, it's termed as liquid on the financial markets, it's a very similarly traded Class-four milk that we use. So we probably get a little more exposure to volatility in that particular business and you saw we had record high milk costs during the last quarter. The Eagle business really wasn't organized to hedge that, we will be going forward. So I think you can count on us. We don't do it speculatively. We hedge to cover our needs for the pricing periods ahead of us. Christina Mcglone - Deutsche Bank: Okay, Steve. So, when I look -- I mean you are having lot of fun these days, I am sure, if I look at Minneapolis wheat and should I think oh my god they are paying $20 a bushel, or of thinking okay, at least through the year end or may be through further than that for spring break you are locked in at a lower price.

I think that's fair, I mean because of the supply chain and because of our customer commitments on the Easter and all of those pricing periods, we would have that locked in well in advance of those periods. Christina Mcglone - Deutsche Bank: Okay.

It is an exciting time, an understatement right, I mean you can't even buy Minneapolis wheat if you need it right now. it closes up at the limit every day. So, we are not in that position. And you can't be in our business, we've seen competitors have disruptions in deliveries, but we just can't be. So, you have to be covered for your promotion periods ahead of time. Christina Mcglone - Deutsche Bank: Okay. And in terms of Eagle, I was surprise that there were higher costs associated with that, because I thought you would have cost savings, because of the integration of headquarters?

We did have all of those savings, but milk traditionally has -- Class IV milk has been $9 to $12, a 100 weight and it went to almost $22 during the third quarter. Christina Mcglone - Deutsche Bank: But I think you mentioned that in SG&A.

Yeah. Well the offices close Christina in the later part of calendar '07, so we'll see those in earnings during the fourth quarter, but there was still cost as we were shutting that facility down. Christina Mcglone - Deutsche Bank: Okay. So, the synergies will flow in the fourth quarter.

That's right. Christina Mcglone - Deutsche Bank: Okay. And then I guess last question again for Paul, the beverages' moderation in sale, so you attribute it to shortage of apples, how long will that persist?

That will persist through the remainder of this year. We feel that we'll get that crop back going in to next fiscal year. But overall our sales have been pretty good, we've had some timing issues of one of our large customers, as far as their order pattern and that will pick up in the fourth quarter. Christina Mcglone - Deutsche Bank: Okay. Thank you.

(Operator instructions) We will go next to Farha Aslam with Stephens. Farha Aslam - Stephens: Hi Good morning.

Hi Farha. Farha Aslam - Stephens: Traditionally this is the time of year where you start looking at next year's fall bake, congratulations for a good one this year. When you look at the soy and wheat costs, how are you thinking about next year's fall bake in, how do you think pricing will go there?

Hi Farha. Farha Aslam - Stephens: Hi.

There is no question that if you had a price fall bake today, we are looking at 30% differences from year ago. Some core items, individual items will be up a $1, I mean a bottle of vegetable oil, right up 48 ounce, which is in most of the category promotion would be up the $1. I think our customers recognize that pricing at this point may not be prudent and most of larger customers understand what's going on in the markets. And we are literally, as we speak, working with them to put plans in place so we can manage around that hopefully. And commodity markets go down harder than they come up traditionally, will that be next year I don't know, but we've got to be positioned to work with either way. Farha Aslam - Stephens: Okay. And then when you look at your market share in Crisco, was your market share in Crisco up this quarter?

No it wasn't. And in these cost environments, we are really doing this three dimensionally, we are looking at the consumer demand, what is our position and then how do we translate that in to price. And there is a lot of volume opportunities right now, but they just not prudent. And we are in Crisco for the long-term, we've had probably two years of very tough costs. We were still driven great in olive oil, and in spray, and all of things we deem strategically important we will market those items over the next year. But on the vegetable business, we are really managing that through the commodity turmoil. And we are doing it just to be prudent, cost versus our position versus the promoted volume. Farha Aslam - Stephens: And I think it's great that you are managing for profitability, especially given the tough environment, but do you think it's because you are choosing to just pull back and manage for that profit level or do you think it's that consumers are going to the shop and just seeing that dollar increase and saying well that's too much of a price hit for me. And I am going to trade-down to private label.

A lot of those haven't happened yet, the biggest pieces haven't happened yet, obviously there is some of that. Our private label retailers are going to face the same costs and in the meetings we have with them they are as challenged, as we are, going forward. So I think, I do think we might see size migration. We may see some things go down and we will start to talk about that and we're positioned well to do that. We've got the broadest portfolio of offerings in the category. So we may see 32-ounce instead of 48-ounce those types of things. Farha Aslam - Stephens: Okay

But it's in uncharted water clearly. Farha Aslam - Stephens: So you've put through a 30% price increase in Crisco?

For March 10. Farha Aslam - Stephens: For March 10. And have you heard that competitors have followed so far.

The entire industry appears to be. Farha Aslam - Stephens: Entire industry. Okay. And could you Mark may be just share with us some of your cost savings. You've said that you've taken down cost as much as you can. Could you may be detail a little bit kind of what those amount to, so that we can kind of think of how you're offsetting this commodities for next year.

Well Farha, when I talk about that most of the costs are in the corporate administrative area, as we have added these acquisitions, we said in the past, we were able to use our infrastructure so we really not had to add much headcount for additional expenses with those folks. So we have been able to maintain from a dollar amount a consistent corporate amount. So that's probably were the biggest savings. We are certainly looking at some opportunities, some of our facilities to improve efficiencies there. We have recognized some of that to date as well, but that's proved well in the past where we have improved productivity affecting cost reductions there. So it really is a sort of across the organization. I wouldn't say we have any one significant restructuring program in place to go at cost.

All of our plants have what we call Smucker quality management system programs in place which are long term programs, but some of them are starting to pay dividends in terms of getting lower -- more throughput to the plants. So we have seen great opportunities there. So almost every element of our company has some sort of cost savings program in place. Farha Aslam - Stephens: Okay. And my final question is on the share repurchase program. You have increased your share repurchases up to that 5 million. Do you have any thoughts on how quickly you'd like to execute that going forward?

I think so far we have done pretty consistently over the last three years, it is obviously at our discretion we look at the market conditions, we look at our opportunities for other uses of cash, and it really comes down to that. We said in our release of the previous 5 million shares, that was repurchased over about a 3 to 3.5 year window, not saying that necessarily is going to be the case for this. But we really do look at the other options and then make that decision when appropriate. Farha Aslam - Stephens: Right. Thank you very much.

We will go next to Eric Serotta of Merrill Lynch. Eric Serotta - Merrill Lynch: Good morning.

Hi, Eric, good morning.

Good morning. Eric Serotta - Merrill Lynch: You guys didn't comment on your full year guidance or you didn't write any full year guidance particularly in relation to your long-term 8% target. Looks to me like you'll be getting a nice benefit from the lower tax rate you could see that adding about three percentage points. But what you looking at in terms of overall EPS growth for the year and then sort of core EPS growth if we adjust for the tax rate?

Eric, this is Richard. We historically as you probably know we don't give guidance other than to say that our long-term growth rate is 8% top line and 8% or better on the bottom line. So, we have been very, I think, interested in not giving specifics. Eric Serotta - Merrill Lynch: Okay, and then your marketing spending, I think you said, was up 17% year-over-year. Could you give us an idea how much of marketing spending has been up year-to-date and then could you put that in a bit more contacts with, your sales are up 27% in the quarter, so your marketing as a percentage of sales were down. I know there's been a lot of mix-shifts with the business, with perhaps some less marketing intensive businesses coming out, perhaps some less marketing intensive businesses coming in. But what's the appropriate level of marketing as a percentage of sales and how you've been tracking that.

Sure. Let me take a correct idea Eric. You are right on the 17% sales increase or a market increase for the quarter. That's pretty consistent with what we have seen year-to-date. If you look at that in comparison to top-line growth, of course we have a lot of acquisition in there. Particularly with Eagle, keep in the mind that a good portion of that business is private-labeled which of course is not heavily marketed. So, marketing percentage of that business would be much less. So from sort of the high level that -- I don't have the numbers right in front of me, but I would guess that our marketing is probably at or maybe even a little greater than our overall sales growth once you back out the impact of the private label side of eagle. Eric Serotta - Merrill Lynch: Okay. And could you give us any color in terms of marketing mix between sort of the core fruit spreads and peanut butter business and some of the other business, the baking and -- if it was in baking in particular?

Sure. Obviously I think it's fair to say that we spend more consumer marketing on our leading brands at this point being the Smucker's, Jif versus maybe some of the baking and oils brands at this particular point. Although, we've increased those marketing pretty significantly since we've acquired them. Eric Serotta - Merrill Lynch: Okay.

And we won't have marketing spend increase as quickly as we are having these commodity increases. I mean after these things settle down over some period of time and we get a run rate what's the cost and the net sales impact of these commodities then we'll see marketing maybe equilibrate. But we're just trying to keep up pricing with raw ingredients, not let the ingredient cost hurt us as we write this thing up, and so we won't follow that on the commodity business.

Yeah, one other thing, Eric this is Tim Smucker. Just keep in mind, our philosophy is long-term, so we stay the course. And continuity and consistency are much important than quarter-to-quarter ups and downs. So we use all the marketing mix, but it's a long-term brand building. I think you've heard us talk before once here upon a year and I think we are striving at it. So it more continuity over a long period of time and quarter-to-quarter, as we look at marketing spend. Eric Serotta - Merrill Lynch: Sure and just a follow-up question on peanut butter. Your share of performance was certainly quite impressive, particularly given how aggressive your competitor was in terms of promotional activity in the quarter. As we look to the fourth quarter, if I remember in the year ago period you had a bit of a windfall of, if I remember correctly, $10 million to $15 million in sales from your competitor being out of the market. You also had a bit of a margin benefits from pulling back on merchandizing activity and promotional support as peanut butter was effectively sold out. Would you expect to see a return to, both, I know you said return to normal levels of sale growth for that business, but also in normal level of merchandizing and promotional activity in that business going forward?

I think that was well stated. Eric Serotta - Merrill Lynch: Okay. Thank you very much.

Thanks, Eric.

We'll go next to Jon Anderson of William Blair. Jon Anderson - William Blair: Good morning.

Hi, Jon. Jon Anderson - William Blair: I was wondering if you could comment a little bit on some of the new products that you touched on briefly in the prepared comments. Specifically, looking at where you are with respect to the rollout of Jif's snack nuts, Crisco Olive Oil and may be comment on the ACV and whether those products are meeting your expectations and where they go from here?

I'll comment of Jif snack nuts. It's relatively small test, through sort of North Central United States and it's still very early but we are in process of supporting it with T.V advertising and trade and other consumer marketing. And the early results are encouraging, but it is truly too early to tell at this particular point. But I would guess the ACV is around 10% or something in that neighborhood. Jon Anderson - William Blair: Okay.

Steve?

Yeah, when we look at Crisco Olive Oil, we started the testing in Texas and Florida, we've gone through the southern US and then in this fiscal year we're rolling into the mid-west. And results are good. They vary by customer. That is still a more fragmented industry than the most of its size and so we're encouraged by it. We've got new packaging we've got a number of new things coming and we plan to continue to expand it.

And then on the Hungry Jack brand, I think well Tim mentioned both the Refrigerated Potatoes and the Frozen Biscuits are also in a small test market to try to make sure we're successful before we rolled those out and that also in a couple of key markets here in the mid-west.

And in Canada, this is Mark Smucker, we had two significant efforts against new products, the first was the launch of our Robin Hood frozen muffins in three SKUs and the relaunch of our, what had been reduced sugar to now a no sugar added product in Canada. And early indications are that both are going very well the customer acceptance has been good and the indications on the consumer acceptance seem to be good, so we're pleased with that in Canada as well. Jon Anderson - William Blair: Great thanks. And in terms of Uncrustables, it sounded like that you have another very strong quarter I think you mentioned up 25% across all channels was there a similar strength across retail versus kind of foodservice or schools channel?

Actually retail was a little stronger in the quarter than foodservice I believe, retail was up about mid-30s%

That's right foodservice was up in mid-teens. And in foodservice we're in the process of launching the whole wheat Uncrustables, the retail side has just done that and foodservice will be launched at the end of the month. Jon Anderson - William Blair: Great and then last one from Mark. The gross margin percent decline in the quarter, and I think you attributed to three things, obviously the raw materials, soy oil and wheat, Eagle milk cost and then mix of sales. Can you elaborate little bit more on the mix sales, how much of that drove margin decline and will that ease going forward?

Well, I think it will ease, maybe I'll so its been a little differently. The gross margin decline I would say a little more than half of that was specific Eagle, and of course that's Eagle and then there is also little bit of mix within that. And then probably one-third of it was due to the affect of the cost - increases at the cost of company. So the net of that would be more a mix, but certainly more than half of was specific to Eagle during the quarter. Jon Anderson - William Blair: Great.

And as I mentioned Jon here, we do expect that profitability both at the gross margin level and the operating margin level to improve over the third quarter going into the next quarter. Jon Anderson - William Blair: Okay. Thank you

Gentlemen, I will now turn the conference call back to you to conclude.

Thanks a lot for everybody's participation today. I think as Christina had said this morning that these are times that we have a lot of fun during these periods and clearly these are challenging times. But I think it's important to note that we are really extremely proud of our team. This is the time when people really are putting in a tremendous effort as they always do, but particularly in unchartered waters, but we're really extremely proud of our team. I thank them for their great progress that we are able to report today. Have a great day.

Ladies and gentlemen, if you wish to access the rebroadcast after this after this live call, you may do so by calling 1-888-203-1112, or 1-719-457-0820, with a pass code of 3196264, or by accessing the website for a downloadable MP3 format. This concludes our conference call for today. Thank you all for participating and have a nice day. All parties may now disconnect.