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Executives

Robert O’Malley – President, Chief Executive Officer, Executive Director

Lisa Prentice – Senior Vice President and Chief Financial Officer

Analysts

Andrew Rosenberg – Footprints Asset Management

[Andy Worovitz – Gold School Partners]

[Ed Bolinski – Private Investor]

Mike Neary – Neary Asset Management

Daniel Barach – MLT Capital

[Julius Sanders – JS Investments]

Steven Hicks – Private Investor

[Frank Hoffman – Capricon Advisers]

InFocus Corporation (INFS) Q3 2008 Earnings Call October 28, 2008 11:00 AM ET

Operator

Good morning and welcome to the InFocus third quarter 2008 financial results conference call. Leading the call today will be Mr. Bob O’Malley, President, Chief Executive Officer and Ms. Lisa Prentice, Senior Vice President and Chief Financial Officer. After I read the Safe Harbor Provision, I’ll turn the call over to Mr. O’Malley and Ms. Prentice.

During this call, we will discuss InFocus’ business outlook and provide forward-looking statements regarding expected gross margins and operating expenses. In addition, we may provide forward-looking statements concerning expectations regarding other factors impacting into the period revenues, gross profits, expenses, earnings, inventory levels and new product introduction.

Investors are cautioned that all forward-looking statements involve risk and uncertainties and several factors could cause actual results to differ materially from those in the forward-looking statements. A more complete listing of the risk factors that could cause actual results to differ from these forward-looking statements can be found in the company’s periodic reports on Form 10-Q and 10-K.

The forward-looking statements contained in this conference call speak only of the date which they are made and the company does not undertake any obligation to update any forward-looking statements to reflect events or circumstances after the date of this conference call. In addition, if during this call any non-GAAP financial measures are used as designed by the SEC and Registry, you will find the required reconciliation to the most directly comparable GAAP financial measure on the company’s web site www.infocus.com. Thank you and now, I’d like to turn the call over to Mr. O’Malley. Please proceed.

Robert O’Malley

Thank you, Nora. Welcome to our third quarter results conference call. With me today is Lisa Prentice, InFocus’ Senior Vice President and Chief Financial Officer. After I briefly discuss our third quarter result, Lisa will provide a more detailed review of our financial performance. I will then return to summarize the third quarter performance and lay the groundwork for the remainder of 2008.

Revenue for the third quarter was $70.6 million. Gross margin dollars were 11.4 million or 16.1% to revenue, and operating expenses excluding charges were $15.1 million, resulting in a proforma operating loss of $3.7 million. Cash and cash equivalents at the end of Q3 were $70.3 million.

Obviously we did not meet our plans for Q3. As economic conditions deteriorated, we saw a softening in demand and increased margin pressure in our US and European markets. Average selling prices declined by 5% between the second and the third quarters.

After four consecutive quarters of gross margins above 18%, we saw margins fall to 16.1% in the third quarter. The factors contributing to this reduction were product and geographical mix, as well as aggressive pricing in our commodity products. Margins were also negatively impacted by the strengthening US dollar especially against the Euro. However we were able to hold share in our key markets, and our performance in Asia continued to be positive with sales up 12% over the second quarter. For the second consecutive quarter, our revenues exceeded $10 billion in Asia.

In September we’ve begun shipping three new projector platforms, the InFocus IN1100 series projectors for mobile professionals and teams, revolutionizes computer to projector connectivity with new DisplayLink technology that connect over USB instead of the traditional VGA cable. This differentiated feature is a key element in our strategy to regain our leadership position in the mobile segment.

DisplayLink is also available on the InFocus IN3100 series projectors for conference and classroom use. This addition to our portable lineup can be used on a tabletop or mounted on the ceiling and upgrades this segment of our product portfolio.

The InFocus IN5100 series installation projectors feature the new split screen technology. We are pleased to report that split screen has been well-received by our higher education and corporate customers for use in distance learning and video conferencing. These applications are receiving increased interest as enterprises seek to reduce transportation cost, and schools extend their reach beyond the main campus.

With these new projectors, we are beginning to transform the business from one that offers commodity products to one that provides value-added, differentiated solutions. Our view of the differentiation extends beyond the product offering to include supply chain leverage and service excellence.

On October 2nd, we are one of seven companies recognized by the Tech Data Corporation as Vendor Partner of the Year for our pioneering work with them to streamline supply chain operations. This month we also hired the director at Worldwide Customer Service Operations who will focus on optimizing our customer support and service delivery worldwide. And we have increased our focus on strategic account penetration and during the quarter added eight new Fortune 1000 companies to our customer base.

At the same time, we continue to closely manage our cost structure. During the quarter, we experienced a sequential reduction in proforma operating expense of roughly $500,000 and a year-over-year proforma reduction of $2.0 million or 12%. We achieved the lowest level of quarterly proforma operating expense in over ten years while continuing to invest in growth opportunities.

Finally, on August 18, we announced that the InFocus Board of Directors authorized the company to repurchase up to 4 million shares of our common stock over three years. Lisa will now provide a more detailed review of the third quarter’s financial performance after which I will have a few closing comments before taking your questions.

Lisa Prentice

Thank you, Bob. As Bob mentioned, (inaudible 00:12.56) 16.1% in operating expenses excluding charges were $15.1 million resulting in a proforma operating loss of $3.7 million. This compares to revenues of $72.7 million in the second quarter of 2008 and revenues of $75.8 million, gross margins of 18.2%, proforma operating expenses of $17.1 million and a proforma operating loss of $3.3 million in the third quarter of 2007.

Restructuring charges excluded from proforma operating losses were $430,000 in the third quarter of 2008; $900,000 in the second quarter of 2008, and $225,000 in the third quarter of 2007. Non-operating income was $100,000 and the net loss for the quarter was $4.2 million or $0.11 per share. This compares to a net loss of $3.8 million or $0.10 per share in Q2 ‘08 and a net loss of $2.8 million or $0.07 per share in a third quarter of 2007. Total cash and marketable securities were $70.3 million as of September 30, an increase of $500,000 from the end of the second quarter and a decrease of $2.4 million compared to the third quarter of 2007.

I will now provide a more detailed look at the P&L. Revenues for the quarter were $70.6 million, a decrease of $2.1 million or 2.9% compared to the second quarter of 2008 and a reduction of $5.2 million or 7% compared to the third quarter of 2007. Total projectors sold in the third quarter were approximately 94,000, an increase of 2,000 or 2% from the second quarter of 2008 and an increase of 10% from the third quarter of 2007.

Overall, average selling prices decreased by approximately 5% from the second quarter of 2008. Revenues from the Americas decreased by 4% from the second quarter of 2008 and decreased by 23% compared to the third quarter of 2007. Projector unit sales in the Americas for the third quarter increased 4% compared to the second quarter of 2008 and decreased by 14% compared to the third quarter of 2007.

Channel inventory levels in the Americas, our largest market were about six weeks of inventory at the end of third quarter, unchanged from the second quarter of this year. Internationally, European revenue decreased 8% from the second quarter of 2008, an increase by 25% compared to the third quarter of 2007. Revenue from Asia increased by 12% compared to the second quarter of 2008 and 29% compared to the third quarter of 2007.

The breakdown of revenue geographically in the third quarter was 55% Americas, 29% Europe, and 16% Asia compared to the 56% Americas, 30% Europe, and 14% Asia in the second quarter of 2008. The breakdown of revenue by projector product lines in the third quarter was 72% portable, 16% installation, and 12% mobile compared to 68% portable, 16% installation, and 16% mobile in the second quarter of 2008.

The shift in revenue from mobile to portable was the result of product transition and was a contributing factor to the shift in gross margin between quarters. We ended the third quarter with a backlog of $4.8 million, a decrease of $4.3 million from last quarter. Typically, backlog is not necessarily an indicator of future period sale.

Gross margin was 16.1% in the third quarter of 2008, a decrease of 2.1 percentage points from both of second quarter of 2008 and third quarter of 2007. This reduction was primarily due to unfavorable change in product and geographical mix. Total operating expenses worth $15.5 million for the third quarter, a decrease of $1 million from the second quarter of 2008 and a decrease of $1.8 million compared to the third quarter of 2007.

Excluding charges for restructuring, operating expenses were $15.1 million, a reduction of $500,000 from the second quarter and $2 million compared to the third quarter of 2007. Operating loss for the third quarter was $4.2 million compared to an operating loss of $3.3 million in the second quarter of 2008 and an operating loss of $3.6 million in the third quarter of 2007. On a proforma basis, excluding charges for restructuring, we recognized an operating loss of $3.7 million in the third quarter of 2008 compared to an operating loss of $2.4 million in the second quarter of 2008 and an operating loss of $3.3 million in the third quarter of 2007. Other income was $100,000 in the third quarter of 2008 compared to other expense of $200,000 in the second quarter of 2008and the other income at $800,000 in the third quarter of 2007.

Moving on to the balance sheet. Cash and marketable securities at the end of the third quarter were $70.3 million with no outstanding debt. This is an increase of $500,000 from the second quarter of 2008. Accounts receivable were $39.2 million as of September 30, 2008, a decrease of $4.8 million from the second quarter of 2008. Day sale as outstanding for the third quarter with 51 days, a decrease of 3 days compared to the second quarter of 2008.

Total inventories at the end of the Q3 were $30.4 million, an increase of $5.9 million from the second quarter of 2008. Finish good inventories were $22.3 million at the end of the third quarter and represent 73% of total inventories. Inventories increase as we have stage inventories on the expectation of higher revenues during the period. (Inaudible 00:19:15) plan and equipment was $2.4 million at the end of the third quarter, a decrease of $300,000 from the end of the second quarter.

Capital expenditures during the quarter were $400,000 and depreciation and amortization expense was $700,000. Non-cash items included in our net loss of $4.2 million included depreciation and amortization expense of $700,000; stock-based compensation of $300,000; deferred income tax of $100,000 and other non-cash items up to $300,000. This results in a cash burn from the net loss of $2.8 million.

We continue to manage our cash balances very carefully and practice conservative cash management. Our investments are primarily in a triple-A money market fund the fund is backed by the Treasury Guarantee Program.

While working capital was the source of cash in the third quarter, we expected that there will be fluctuations in our working capital balances which will impact cash in the future period. As Bob mentioned earlier, the Board of Directors authorized a share repurchased program which we announced on August 18.

During the third quarter, we repurchased 50,000 shares of common stock in the open market at an average price of $1.53. While we continue to believe the stock is attractive especially at the current level where the repurchases of shares under the Board authorized plan will be based on careful consideration of current and future cash flow need, business forecast, and the overall state of the economy.

I will now turn the call over to Bob for his closing remarks.

Robert O’Malley

Thank you, Lisa for the review of the Q3 results. (Inaudible 00:20:51) results in the third quarter were next. Let me look at each of the major financial metrics and give you my assessment of our performance.

First is revenue accompanied by the market share in the margin that revenue generates. We have discussed that our operating breakeven point is between $75 million to $80 million per quarter with gross margins ranging from 18% to 20%. In the third quarter, we staged inventory to deliver revenue that would get us to our breakeven point.

The third quarter and AMEA (ph 00:21:23) is heavily dependent on September recovery after summer vacations but business in the U.S. is influenced by the federal buying season. Both were disappointing. Based upon our market share estimates, we believe that we have maintained or slightly increased share in key markets.

My conclusion is that the overall projector market in revenue terms was at best flat compared to Q3 of a year ago. Gross margin was amiss primarily due to the softening markets, ensuing competition, and our dependency on lower priced products. We have increased prices in AMEA by an average of 6% in September and that attempt to offset margin pressure caused by the strength in the U.S. dollar. We expect this competitive environment to continue and are adjusting our product supply and emphasizing in our new differentiated products.

In addition, our focus on the North American Pro Av Channel is getting traction. We expect our business in this value added channel to grow in high double digits in 2009. The InFocus strategic account program which we believe is the most comprehensive program in the industry is growing as we add focus, attention, and sales resources. With these actions to address product and customer mix, my target for gross margin longer term remains at 18% to 20%.

The second metric to consider is expense management. We continue to trim legacy expense issues and refine our cost structure. We have continued to work to refine our subsidiary structure as our facility needs. Many of these actions were previously reserved for so don’t have an immediate cost benefit but will serve as minor overall infrastructure and we’ll reduce our use of cash.

We also continue to focus on reducing our ongoing discretionary expenses and increase in our efficiencies. For example, we are leveraging the use of projector-based high definition video conferencing solutions that conduct internal and customer meetings.

The last metric I would focus on is working capital management. With the exception of this quarter’s inventory, we managed working capital well. As I mentioned, our inventory planning was based on the expectation or breakeven or better.

We plan for the typical seasonality of the third quarter and when demand softened, we couldn’t react fast enough. The good news is that we have fresh inventory of new products available in the pipeline and ready for sale. Thank you and I will now open the call to your questions. Nora?

Question-and-Answer Session

Operator

Thank you. (Operators Instructions) Your first question comes from the line Andrew Rosenberg of Footprints Asset Management. Please proceed.

Andrew Rosenberg – Footprints Asset Management

Just – first of all, a quick question on the receivable and inventory balances to (inaudible 00:24:39) where the payables are. Is there any write downs on the receivables or the inventories that happened during that quarter? And if you can talk about that.

Robert O'Malley

We’ll let me ask Lisa and – I just mentioned that the receivable performance was just a very good execution and an inventory in general was, you know, as I said, you know, we expected to see a resurgence in revenue and unfortunately, you know, the economic situations, the currency situations, all that hit like a tsunami in September and it caused us a little bit of disappointment relative to revenue and relative to margin compression. But specifically on the – what Andrew asked Lisa on the AR write-offs or any inventory write-offs.

Lisa Prentice

AR has been very clean; we continue to watch that closely and it's very current. We did not have any unusual items there, as well as inventory on the payable side, it's very clean as well.

Andrew Rosenberg – Footprints Asset Management

Okay. I guess the reason I asked; I was just looking at the equity coming off in the Q2 to this quarter. And I know it looked like there were some other current assets that got written down a little bit there, but I didn't know if maybe that was a – my math was wrong or if there was something else I was missing on that front.

Lisa Prentice

There were some other current assets that got cleaned up, you know, things like that payable [audio gap 00:26:02 – 00:27:22].

Robert O’Malley

I would even throw Canada into there as well. And where it's hurt us is that on two fronts, first of all, while we get some benefit of our operating costs, we didn't have enough time over target in third quarter to really see – you know, as our cost-to-price ratio goes up we saw shrinking margins and potentially – and we had to walk away from some business that was marginal at best.

So we're very concerned about the volatility of currencies. Once they stabilize, everything adjusts accordingly. But it's this period of high volatility that we're watching everything obviously daily.

Andrew Rosenberg – Footprints Asset Management

Understandable. You know, on your contract manufacturers being a Taiwanese base, I believe that's correct. I don't know if they have concern over cash balances for any of their customers, including yourselves. I don't know if you can talk about that.

Robert O’Malley

They're Taiwanese-based; their operations for manufacturing are in China. And as you know, we're U.S. dollar based in terms of our contracts. They in general have concern; we do pay within terms, and Lisa, why don't you comment on that one situation where we put an LC in place.

Lisa Prentice

The Taiwanese companies have probably been concerned about the U.S. economy for months, you know, probably six to nine months. So we have been continuing to work with them. we did put one new LC in place this quarter for 10 million, which was to recognize that the risks they felt on their part, and today they're very comfortable.

Andrew Rosenberg – Footprints Asset Management

Okay. you know, one thing just from the overall environment in North America, obviously being more economically impacted now, is the sales that you see, is it – I know sales cycles seem to have been lengthening for several companies. Is it more people are pushing out sales or are they moving more to lower ASP-type products right now?

Robert O’Malley

Well, I think the whole industry is somewhat at fault here. it's because we've as an industry have written the commodity curve. I think I've talked about kind of the flattening of the industry. ASPs have gone down for the last three to four years. So I think it's up to us as a leader of the industry to start to bring differentiation back in.

So as I mentioned, a featured – some of the items on the IN, 1100 IN3, 100 IN 50, 100, we have four new products that we're staging for the middle of next year, all of which will have differentiating features as part of them. So we are planning to bring differentiation and consequently margin back into the protector business by being the first to kind of buck the commodity trend.

Andrew Rosenberg – Footprints Asset Management

Do you think that will happen right away in the fourth quarter with the new products out there that you mentioned that you might be able to get back into that range?

Robert O’Malley

Well, we announced on September 16th that we were now shipping these three products. We've seen some very quick acceptance of them. granted it was only a couple weeks in the quarter. We expect these products to be very active. And we expect, more importantly, for them to kind of set the trend to bring differentiation back into the business.

Andrew Rosenberg – Footprints Asset Management

One question that I have on just the seasonal trends from Q3 to Q4. I know it's usually and up quarter, usually your best quarter. I think last year it was about 7%ish, just on the revenue growth. Any reason other than retail, maybe which you don't have this year – any reason to think that it would be much lower than or is it obviously the economy maybe throws a little bit of a wild card in that? But I don't think you mentioned that expectation if there is any.

Robert O’Malley

Well, the economy is a big wild card, I think, right now. And what we're seeing is, you know, there are, in our business we really look at the root demand drivers for our business. Certainly the corporate business is more typical of standard replacement cycles. You know, a large customer will say, "Well, we're going to replace PCs every three years," maybe the projected is every five years.

But we're seeing at least now, right now, we're seeing that replacement type business continue. We're seeing, however, on the business that is construction-related and this is not just the home market, this is also corporate moves and renovation of conference rooms and things that are more facilities-related, we're seeing that business slow down.

And what we're trying to do to buck that trend is to talk about new uses of projectors. And I reference one of our uses in this high definition video conferencing space. I mean, it's been a tremendous asset to us and we're now trying to spread that religion.

Andrew Rosenberg – Footprints Asset Management

Okay. One final question and I'll get back into queue, but considering where the stock has gone recently with the market in general having sold off. Any thought to increase just the number of shares? I know when you did the buyback the announcement was on a share number and I don't know if it makes sense now maybe say hey, instead of 4 million we can move that needle up a little bit more than that.

Robert O’Malley

Well, we haven't got the 4 million yet, so that's one aspect. Obviously with the stock closing – I think yesterday at $0.89 it's a lot more attractive than what we bought last quarter at $1.53. But we're trying to balance the needs of the company in the immediate term with the opportunity for a stock buyback with the opportunity for some other use of the cash that we might have.

Andrew Rosenberg – Footprints Asset Management

Okay. Well, thank you guys for taking my questions.

Robert O’Malley

Okay, thanks Andrew, for your support.

Operator

And your next question comes from the line of Andy Worovitz of Gold School Partners (ph 00:33:09). Please proceed.

[Andy Worovitz – Gold School Partners]

Hi. I don't know if I'm going to be as supportive as the person on the phone before this. Your stock, I entered your company as an investor about a year ago, literally a year ago. Your stock at the time was about $1.70. Currently your stock trades for about $0.70; I'll tell you the exact number, $0.79, $0.80 a bid. Okay? You have right now on the balance sheet roughly around $1.65 per share of cash, am I correct?

Robert O’Malley

Well, it was the $1.76, I believe, as of September 30th.

[Andy Worovitz – Gold School Partners]

Okay. $1.76, even better. My question to you is what's the point of this business? You guys have tried quarter after quarter after quarter and now you've hit another wall. And I'm wondering to myself would it not just be better for everybody, shareholders included, for you guys to shut this business down, sell off the remaining inventory and give us the cash so we can at least have something left over instead of watching the stock converge to zero?

Despite you having all this cash, and with the fear now, of the next couple of quarters in an economy that is spiraling out of control on the downside, of us fearing that you guys are going to start feeding into that cash and taking away the one asset this company actually has.

Robert O’Malley

Well, I appreciate the opinion, Andy, and I mean, those obviously are things that the board considers regularly as what is the best course for this company and for the owners of this company. We're not obviously alone in this situation. We just looked at the – I took a look yesterday at the industry and particularly at our customers, I identified ten of our customers, who are all trading an average 40% of what they were trading at on June 30th. So it's obviously something that we consider, as I said, regularly, and it's one of the many options that we obviously take a look at.

[Andy Worovitz – Gold School Partners]

Okay, I know you're just giving me an answer here, because I know this is not going to actually go back to the board and be discusses right now. But I'm telling you right now is that you have a company that is at $0.80, and you have a $1.75 per share of cash. Either you believe in your company and you should be buying every single share in this marketplace under a dollar at least, or if you don't believe in your company, then you should actually be taking apart this company and giving us, the shareholders, who have been overly patient, I think at this point, and just give us back our money.

Instead of you guys saying that you're going to have a business and the margins are going to get better, what I see here is that you guys are incapable of actually turning a profit in this company. And for the last year we've all given you the benefit of the doubt, and you know what though, you've gotten a year. Your anniversary is over. And I think at this point in time you have a fiduciary responsibility to the shareholders here to actually look at this company and say, "Is there a long-term plan for this company or not?" And give our money back.

Robert O’Malley

We are doing so, and your comments do go to the board.

[Andy Worovitz – Gold School Partners]

Well, I surely hope so, because I'm really sick and tired of hearing, you know, for four quarters in a row now, excuses that it's only going to get better and all we've seen is that it's gotten worse and I just don’t want to see that cash position dipped into so that you guys can keep your jobs in running this business when I'm not even sure it has any future.

Robert O’Malley

Yeah, so noted. Thank you, Andy.

Operator

And your next question comes from the line of Ed Bolinski (ph 00:36:53). Please proceed, sir.

[Ed Bolinski - Private Investor]

Good morning. Lisa, I actually have a question in two parts. The first is I'm a little uncertain about the balance sheet. I see that the current liabilities jumped about $16 million between the second and third quarters. Some of the money went into inventories. But could you go through the cash flow slowly enough so that I can write it down and try to understand. It would seem to me that even with the kind of loss that, excluding the stock compensation, et cetera, that the cash balance should have risen higher than it actually did. I don't have a copy of the sources and applications, but could you take that – and that's part A.

And the part will come, should I give them both to you, will come for Mr. Gardner, which is given the industry and given the circumstance, and considering that hopefully that InFocus is perhaps one of the better-operated companies in the industry – are you seeing any possibility of some competitors, you have over a dozen of them, falling out of this business and giving up?

Okay, first of all for Lisa and then we'll take it there – not Mr. Garner, I'm sorry. Can I have your comment from you with regard to sources and applications? Could you just walk me through that?

Lisa Prentice

Okay, Ed. So we had, as I said on the call, cash burn from our loss of 2.8 million, and that's considering the depreciation amortization and some other non. So that took it to 2.8. So that was actually use of cash. The big source of cash was working capital on AP. That was the big one. And if you look at kind of our DPO, quarter-to-quarter it's higher than normal and it's all about kind of the timing of the receipts of inventory and the timing of the payment. So that did increase significantly this quarter.

Other current liabilities came down and we had some restructuring, like some lease expenses that we were able to get out of that were already reserved that took cash out the door. So from a cash-flow perspective, although cash was flat, if you consider the non-working capital component of it, cash would have decreased.

[Ed Bolinski - Private Investor]

I see. All right, well what I will do is I really, I have to look at the statement, which I will do, and perhaps I'll give you a call later in the next week or two to go over the specific items with you if I may.

Lisa Prentice

Sure.

[Ed Bolinski - Private Investor]

Okay. And the second is – what's happening to the competition?

Robert O’Malley

It's Robert O’Malley, Ed.

[Ed Bolinski - Private Investor]

Bob, yeah, I'm sorry. I've got you confused with somebody else and I apologize for it.

Robert O’Malley

Okay. We added up name competition a little while ago and we came up with 43 name competitors. Many of these competitors are very recognizable brands, and typically they have products in other areas that are loosely adjacent to projectors. For example all of the consumer electronics manufacturers that make TVs also participate in the projector business, so companies like Sony and Toshiba and Samsung.

Or they're companies that have data products, and in particular, computer monitors, companies like NEC and ViewSonic. So these companies are in the projector business because they feel it's a close adjacency, they can leverage their channels and in general most of them buy commodity products and put their brand on them.

So as I mentioned earlier that we are a company focused on projection so we want to move the entire projection industry forward. We want to see projectors participate more in some of the applications that have been kind of exclusively the domain of flat panel monitors and TVs up to this point. And we hope it gets tougher for some of these competitors that are playing somewhat on the sidelines. And we expect to prevail in that process. Did that answer your question?

[Ed Bolinski - Private Investor]

Yep, okay. But there's no – I saw that GNO in this last quarter three, instead of 43 it was 39 or something like that. All right. No, it answers the question.

Robert O’Malley

We haven't seen any of that fallout yet, and although in times like this everybody reconsiders what their business plans are and our objective is to both be operationally very competitive as well as feature function differentiation, which we think will play much more as a deciding factor in some of the new applications that use network capability that are high definition and wide screen formatted and that leverage some collaboration capability that we're working on.

[Ed Bolinski - Private Investor]

Okay. Okay, thank you very much then.

Operator

Your next question comes from the line of Mike Neary of Neary Asset Management. Please proceed.

Mike Neary – Neary Asset Management

Hi, just a question. I just want to make sure I understand this. One quarter ago your net current assets were 80 million. This quarter they're 66 million and the only reason cash didn't drop substantially is because you stretched out your payables by $15 million. Can you talk a little bit about that? I think it's better to address this stuff head-up as opposed to bury it in the cash flow statements and the balance sheet.

Lisa Prentice

Absolutely. One thing I wanted to be clear on; we didn't manage or stretch out our terms. We continue to pay terms on payables on time toward our normal practices. It was really about timing of when the payables hit and when they were due.

Mike Neary – Neary Asset Management

Okay. You reported – you highlighted the fact that your cash was flat in the quarter, but the reason your cash was flat is because you got how many dollars out of working capital in the quarter?

Lisa Prentice

Significant. About 9 million.

Mike Neary – Neary Asset Management

Nine million. And in future quarters that will reverse?

Lisa Prentice

It always jumps around and it will come and go. Yes.

Mike Neary – Neary Asset Management

Right, okay. Can you talk a little bit about your forward contracts on currencies and where we stand with those and just give us some sense of what the exposure is with those?

Lisa Prentice

We hedged today on our balance sheet, so every month we look at that. We're also looking at hedging more of it on a forecast basis around the world. But we don't do that today; we don't do forward contract. We have been doing balance sheet hedges.

Mike Neary – Neary Asset Management

So explain to me, please, the notional and actual exposure we have on various currencies and what's happening with those.

Lisa Prentice

So if it's on our balance sheet we protect it and we hedge that balance sheet so that we are not impacted by the change in currency. So this is wherever we operate in the world, where we have balance sheet in assets we hedge that.

Mike Neary – Neary Asset Management

Okay.

Lisa Prentice

Did I answer your question?

Mike Neary – Neary Asset Management

No.

Lisa Prentice

Okay, try again. I'm sorry.

Mike Neary – Neary Asset Management

What is our exposure to foreign currencies at this time?

Robert O’Malley

Well, it’s mostly on the revenue and margin side, to the extent that our cost basis relative to the local currency goes up, we’re going to be faced with revenue shortfall and enlarging compression, which we saw in September, in particular. As we go forward, as Lisa said, we’re going to need to look at some contract hedging relative to staying competitive in certain markets. Now, to the extent that our competitors have the same issue, they will need to adjust pricing.

Mike Neary – Neary Asset Management

Okay. In the quarter, we lost what, 8 million in foreign currency translation? When you look it stockholders’ equity being down 12 million, quarter-to-quarter, versus your reported loss of 4 million, the difference is foreign currency, correct?

Lisa Prentice

It’s the translation on the balance sheet of the CTA account, yes.

Mike Neary – Neary Asset Management

Right, okay, and, can you just give me an update, kind of how we are subsequent to quarter end with that?

Lisa Prentice

How we are subsequent to quarter end?

Mike Neary – Neary Asset Management

Do we have substantial additional losses from foreign currency adjustments?

Lisa Prentice

No, I mean, most of the currency changes we’ve seen, and most of our balance sheet internationally is probably in the Euro. So, the Euro has moved a little bit since quarter end, but not much.

Mike Neary – Neary Asset Management

Okay, and inventory. Can you help me understand with inventory, in terms of if we didn’t buy any more inventory, how long would that inventory take to go through, do we have any return rights with that inventory, how does that work?

Robert O’Malley

Well, we buy from contract manufacturers. So, the (inaudible 00:46:59) we make, and then transportation time, normally we would expect to see inventories as they were last quarter, 24.4 million, so that’s probably a normal range, we’re carrying 5 to $6 million dollars of additional inventories, and that was predominantly driven by delayed sales from September period. We would expect to eat into that inventory quickly in this quarter, and we would expect to bring the inventory back into what we (inaudible 00:47:36) by quarter end.

Lisa Prentice

So, and of that 30 million, we said approximately 22, 23 million is finished goods inventory. The rest of the inventory is more our service and accessory parts. So, some of that service inventory would obviously take time to deplete.

Mike Neary – Neary Asset Management

Okay, so, if we didn’t buy any more inventory, how long would it take to work through?

Robert O’Malley

Well, it would be about ─

Lisa Prentice

40, 40 some days. I mean, if you just look at turn.

Mike Neary – Neary Asset Management

Okay, and, on the receivable side, can you just give me some sense of how long those would take to get paid back?

Lisa Prentice

They are within terms, so – well, the DFO on that would be 51 days.

Mike Neary – Neary Asset Management

Okay, and corporate costs, what are they running currently? How much is just corporate?

Robert O’Malley

Well, if you look at ─

Lisa Prentice

Total GNA.

Robert O’Malley

GNA is 4.2 million, our R&D is 3 million.

Mike Neary – Neary Asset Management

Okay, and what is our remaining contracted lease obligation? I’ve seen in the 10k that we had done a few things to try to reduce that, but where are we currently with that?

Lisa Prentice

From a restructuring standpoint?

Mike Neary – Neary Asset Management

No, just in terms of, how much cash do we need to spend over the next five years for our leases?

Robert O’Malley

Well, the biggest component of that is the lease obligation to the building in Wilsonville, Oregon, which has three years remaining on the lease, and that total obligation would be

Lisa Prentice

Approximately 1.4 million per quarter. That includes restructuring.

Mike Neary – Neary Asset Management

Per quarter?

Robert O’Malley

Yeah, so from a cash standpoint, that’s, if I round it up to 6 million a year, for three years.

Mike Neary – Neary Asset Management

Okay, it looked like, from your 10k, you had roughly 11.5 million remaining. Have we extended any of our leases?

Robert O’Malley

Leases, other than the facility here, are relatively short term. As we mentioned we’ve cleaned up some legacy problems associated with an acquisition. We had some facilities in Norway, that’s been cleaned up this quarter, and as we’ve said in previous calls, were working on alternatives to this facility in Wilsonville.

Mike Neary – Neary Asset Management

Okay, and how many shares have we bought subsequent to quarter end?

Lisa Prentice

We don’t disclose that.

Mike Neary – Neary Asset Management

Have we bought any?

Robert O’Malley

We don’t disclose that.

Mike Neary – Neary Asset Management

Okay, so, is the purpose – and you’d mentioned in your call, you evaluate the cash needs for the company to ensure that you have enough cash, how much cash do you think we’ll burn over the next 3 to 4 quarters?

Robert O’Malley

When we say we’ll evaluate the needs of the company, some of this cash is spread around the world, and as Lisa mentioned, some of this cash is tied up in LC’s with our suppliers. Some of the cash, also, is used selectively for certain markets. So, we’re AR terms are beyond our standard 30 day policy. So, and those are kind of the needs of the company.

Lisa Prentice

And the other one is just the economic conditions of the wildcard of how we use cash in the next couple of quarters.

Mike Neary – Neary Asset Management

Okay, but, I guess your expectations are then that you will use cash for the next several quarters?

Robert O’Malley

Well, it starts with the revenue and margins, and whenever revenue and margins assumptions they make. Obviously, the plans that we had for the year we’re having now to go back and reassess. We’re going through the planning process for ’09 and we’re taking a look at different scenarios, as every company needs to do at this point in time.

Mike Neary – Neary Asset Management

Thank you.

Robert O’Malley

Thank you, Mike.

Operator

And, your next question comes from the line of Daniel Barach of MLT Capital. Please proceed.

Daniel Barach – MLT Capital

Yeah, going back to that about $1.75 cash you have on the balance sheet with the stock trade $0.80, and we’re willing to buy back stock at $1.53, why will you not contemplate, and you have a 4 million share repurchase authorized, why won’t you engage in privately negotiated transactions, or a Dutch auction tender offer?

Robert O’Malley

Well, I don’t say that we won’t he entertain such options, Daniel.

Daniel Barach – MLT Capital

Lisa, in a private conversation I had with her, told me that you won’t.

Lisa Prentice

Well, at that point in time we were not considering it. We did talk with the board, that was something they did not want to do at that time. That was at a point in time, and we’ll continue to have conversation.

Daniel Barach – MLT Capital

Okay, because I would like to reiterate what the second questioner said. If you’re not willing to engage in a privately negotiated transaction, or a Dutch auction tender offer that’s at $1.53 or significantly below that, with willing parties, then you should liquidate the company, and return the cash that you have to the shareholders. And, if your stock continues to stay – I mean, would you agree with that logic?

Robert O’Malley

Well, that’s obviously one point of logic, and there are other views of what’s the best way to give the shareholders’ value over time. If you’re talking about what’s the best way exactly today, obviously liquidation is a favored alternative, but if you look at overtime there may be some other alternatives that are preferred.

Daniel Barach – MLT Capital

And, if the stock stays below $1.00, are you going to do a reverse stock split?

Robert O’Malley

Well, we obviously would have to look at a lot of things. The FCC has given us 90 days, and given not just us, but everybody 90 days, to kind of take a breather. Obviously we are a listed stock, we are intent to stay as a listed stock.

Daniel Barach – MLT Capital

But, you’re going to wait until the guns to your head to make the reverse stock split decision, as opposed to try and preempt it?

Robert O’Malley

Well, a gun to the head maybe in interesting choice of words there. You know, there are provisions for a cure to the listings below $1.00. One of those in is reverse stock splits, another is to get the stock above $1.00. So, we’ll look at all those alternatives and we have obviously have had discussions with our board about what latitude we have and how quickly we need to move.

Daniel Barach – MLT Capital

Okay, I’d just finally like to say that he I think there would be a lot of increased confidence investors would have and the company if they did engage in a privately negotiated transaction or in a Dutch auction tender offer, even below the $1.53, which is significantly below the cash you have in your balance sheet, in the very near future, and if they were not willing to do that, again, I would vote with, I think, the second questioner in that you should just liquidate the company, return the cash to the shareholders.

Robert O’Malley

Okay, thank you Daniel.

Daniel Barach – MLT Capital

Thank you.

Operator

And, your next question comes from the line of Julius Sanders of JS Investments, please proceed.

[Julius Sanders – JS Investments]

Hello, guys. I somewhat concur with the last person. I mean, I’ve been with this company for five years, I don’t know what to tell my constituents going forward. I mean, we put the company up for sale two years ago, nothing materialized there. They basically lost all of their investments. I don’t know whether you have the credibility there right now for anyone to believe in the guidance, and, again, the company’s worth more than the stock prices, it’s been like that for the last four or five years. I’d like to get more of an answer from someone on whether this has been discussed with the board recently. I think we all, again, have been more than patient over the years, but enough is enough. What do we tell our clients, who hold a large position of this company? A lot of the clients hold that position because of the optimism that we were given about three quarters ago.

Robert O’Malley

Well, three quarters ago we came off a strong fourth quarter, strong in revenue, Europe had come back, and margins were in excess of 20%. So, not just were you feeling optimistic, we inside the company were feeling optimistic as well. We are encountering some very difficult market situations now, but Julius, all of the comments that you and Andy and Daniel and Mike and others have made are very important to us, and we have the outlook of the shareholders, we’ve got customers, we’ve got employees, and in that order we’re trying to balance what we think the best interest of all parties our.

[Julius Sanders – JS Investments]

Are we considering maybe a merger, a merger with a stronger partner? I think you have a very unique product, a strong product, but the competition out there has more cash flow to just basically challenge you in your market share. That always seemed to be one of the problems we’ve been having as well. Then again, at what point do the shareholders have the right to say hey, I just want whenever I can get back, and I want to move on if? I just think that we’re going to be sitting here having this discussion in another 12, 14, 16 months from now. I’d hate to pull the trigger on the company by just telling clients, hey, there’s no hope here, but the clients here believed in the management, believed in the business model, they have taken substantial losses, and we have a company that’s trading below its book value. We keep talking about the cash, but the company’s worth more than a buck 70, we’re just talking about the cash, what about the assets, the intrinsic value of the company? My numbers come out to around three or $4.00 a share, if you had to sell the company. I just don’t understand why not. I don’t see us being a company with three or $4.00 stocks in the next six to 12 months, and I’m against the reverse split because reverse splits only work with deals with strong business when you do that. SunMicro Systems is a good example, they did a reverse split, and today it’s back to where it was before they took it with a reverse split.

Robert O’Malley

Julius, I would agree with you. In addition to the cash and the book value of the company, we’ve got 240 (inaudible 00:59:49) with another 80 pending, we’ve got the most recognized brand in the projector business, and we’ve got extremely good customer relationships.

[Julius Sanders – JS Investments]

Yeah, I mean, I think we have just a good business that – and everyone gives the appreciation that’s necessary, and I’ve got so many clients. I mean, being the broker that recommended this company, you can imagine the hit that all of us are getting. You know, (inaudible 01:00:08) on this, and again, I’m not talking about anyone losing their jobs, if there’s an appropriate merger, an agreeable merger. The company’s worth a lot more to someone else who has the cash, can come up with four or $5.00 a share, no problem. At the same time, I don’t see – this market’s going to be in trouble for awhile, this economy’s going to be in trouble for awhile, and as you just mentioned, all the good stuff that we have, maybe we should do road shows and remind people hey, this company’s not worth $1.70, that’s the cash. You know, we’re worth a lot more than that. Maybe we need to get more, more conferences would be good. I mean, we only hear from you every three to four months, and that’s not working for us because we have nothing to tell our constituents between that period of time, other than the fact that we don’t know why the stock’s at $.79 today, 79 cents. And, you’re right, other companies are in the same situation, but I think we have more of a story to tell, but we’re not telling it. And, we need to have, maybe monthly conference, just (inaudible 01:01:10), because that’s where we’re going here. Companies, brokers are no longer able to just tell a client well, you know, $.79, it was in the conference call, everything went okay, we’re going to have some tough times the next two or three quarters, but hang in there. They’re getting nothing, they’re not getting a dividend. If they were getting a dividend that would be something that would be workable for us, but again, right now, there’s going to a lot of (inaudible 01:01:36) selling going on in another month, so we are in some pretty bad shape.

Robert O’Malley

Your suggestion of a road show, or at least going out and meeting with investors is a very good one. We’ve said that we would do that in the fourth quarter, and that’s on Lisa and my calendar to have a couple of those sessions to at least get something started, because we do think what we’re doing from a product standpoint and from a customer engagement standpoint is the right strategy.

[Julius Sanders – JS Investments]

Yeah, and I agree with you. It’s just that no one else does, because we’ve been, prior to you arriving to the company, and you did a pretty good job turning it around, but you know, we’ve been here doing this for four or five years, when it was eight, $9.00. It’s $.79. I don’t know any better way other than to say we need to immediately find a partner and negotiate that your good (inaudible 01:02:42), and your good management keep your positions, but I think that would enhance the company and get more company value out of it. But, again, reverse split, that’s out of the question, that would be a waste of time, we would all lose our money on it. Again, you slip after a reverse split and slip and have a bad quarter again, it goes back to one. But, I do think that we need two, and I don’t think we have much time, we need to immediately get out there and send out newswires if we have to. Hey, we are trading well below our book value, this is what we feel our intrinsic value is worth, something in that line, but we’ve been, all these years, we’ll say, you have our quarter, and you have our conference, and we won’t hear from you. I won’t hear from you until next year. That’s just –and, that’s part of our problem. I think if you are more aggressive in getting that message out we wouldn’t be where we are, even under the circumstances. But, again, I won’t hear from you, I’ve got to call you individually. The financial world and the stockholders won’t hear from you until the next four months, and that’s killing us. And, not just you guys are doing that, other companies are waiting too long. You have shorting going on out there that loves this type of method, because it will just spread rumors. And they just sit around spreading rumors and it’s causing people to sell and that’s just (inaudible 01:04:00). Most of the companies on the street, I mean, a company goes public they have to understand that it’s a mechanism when it comes to investing that they’ve got to take into consideration. The shorts are eating our lunch, just by spreading rumors, and no feedback from the company, it’s just basically devastated. How can you sell a company at $.79, when the cash is worth $1.70, and the asset is probably, in the good will, is probably worth another $1.70. You know, if you do basic math it don’t add up. I mean, where’s our analyst here? I mean, we have no coverage?

Robert O’Malley

That’s correct.

[Julius Sanders – JS Investments]

You know, we have no one putting this out on the street, and I think that’s all leading to this problem here.

Robert O’Malley

Okay, I appreciate, Julius, I appreciate those ideas and I – we do need to be more forthright in communication, I think in times like this when there is a lot of change in the wind, people are reassured by communication and by fax.

[Julius Sanders – JS Investments]

Exactly, and, again, I’m saying we need to do this immediately, because my constituents, like everyone else’s constituents, is not going to listen to us anymore, we lost our own credibility as well. They just hear us saying, you know, just hang in there, just hang in there. If I tell them to do that for four or five years, why would they listen to me? You know, if we don’t do it immediately we’re going to have a huge tax loss selling going on and people are going to throw in the towel, and, again, I know that’s what’s about to happen because my constituents are basically saying, you know, don’t talk to me, I want out, get me out of this junk. And you know we’re not junk.

Robert O’Malley

Yeah, well I think some of that’s already happened, Julius. So, I appreciate your comments.

[Julius Sanders – JS Investments]

All right, thank you.

Operator

And, your next question comes from the line of Steven Hicks, private investor. Please proceed.

Steven Hicks – Private Investor

Hi, this is Steven Hicks. I’m the founder of the company. I founded it originally back in 1987, I took it public in ’90. I’m totally disappointed, Mr. O’Malley, I discussed this with you a year ago, I discuss did a year before that with another CEO and a year before that. The idea of diversification, you have the money, you have everything going your way, and you guys are just sitting there blowing it. I can hardly believe this, Bob, I’ve talked to you, and it doesn’t go anywhere. It’s time, you listen to all these people on the phone and they’re all picking the bones. They’re going to pick you up and take you off some place here pretty quick, and it’s all going to be gone, and every one of my shareholders from my company are going to lose their butt. And, I’m going to try to cure that. I believe there’s a way to keep the company, keep it going, and keep it focused and growing. So, Bob, we need to talk. Thank you.

Robert O’Malley

Okay, Steven, you know, we’re on the calendar to do just that.

Operator

And, your next question comes from the line of Frank Hoffman of Capricon Advisers. Please proceed.

[Frank Hoffman – Capricon Advisers]

Thank you. Bob, let me say good morning. Lisa, I’d like to start with you, I have a series of questions. For all the folks on the phone, and certainly for me, could you explain, with a cash balance, how much of this cash is restricted? You just said you set up another 10 million LC, I think there was 22 million of cash restricted before that.

Lisa Prentice

That was before another LC went away. Today we have about $15 million of restricted cash, and of that, 13 million is related to LC and 2 million is related to things like credit cards and deposits.

[Frank Hoffman – Capricon Advisers]

Okay, number two, I’d like to ask both of you, have we hired a corporate development, as Mr. Hicks was suggesting about diversification, since we have a commoditized product base right now, and I don’t believe in a heartbeat that USB and things that should’ve been done three years ago is going to change that, have we hired a corporate development officer, as one of the last investors asked about, with respect to acquiring new product lines, diversifying the company?

Robert O’Malley

Frank, not per se, that kind of activity falls to Lisa and to me in terms of the corporate M&A kinds of opportunities to both explore as well as to vet.

[Frank Hoffman – Capricon Advisers]

Right, well, I personally disagree with the board’s decision to do any kind of stock buyback here, as much as some of the other investors were suggesting we shut the company down and distribute the cash, I don’t believe that’s the right answer, and I also certainly don’t believe that doing a buyback, and I have talked too all the board members about this, doing a stock buyback with a company like this in this economic time with a cash burn is not the highest and best use of our cash. And, what we ought to be thinking about is corporate development activity to try to diversify this company and use the cash at a higher level to find other products that are perhaps within one or two concentric rings of the projector business and invest in that at a higher gross margin, and a higher rate of return, and a higher growth market, as opposed to the commodity market. I just wanted to make that statement, because I do disagree with some of the other investors. I don’t think, again, shutting the company down, distributing the cash is the right thing. From a financial perspective, trading at 50% of your cash balance, yeah, I suppose, you know, is the company wreckable? Sure, but I don’t think that is what Mr. Hicks wants, and I’ve talked to a number of other investors, including myself, I am a shareholder, I think that’s a right thing to do. So, my question, I guess, to you, Bob and Lisa, is what is the strategy?

Robert O’Malley

Well, frank, you point out we have a lot of alternatives, some of which are financially driven, some of which are opportunity driven, and at the core of these opportunities are organic performance. So, one of the cornerstones of what we need to do is make sure that the base business is performing well. And then, when you look at opportunities that we might have, along the lines of what you suggested, clearly we have supply chain opportunities to verticalize what we’re doing, we have complementary products out there that we could wrap around the projector which are becoming more differentiating characteristics. But, the first, and the core, and the base is to make sure the base business runs well, and can sustain itself. Otherwise you’re just putting something on top of something that’s flawed to start with.

[Frank Hoffman – Capricon Advisers]

Then I just have one more question. I’ll make one observation in response to that, Bob, tying two rocks together doesn’t make them float. Okay? That’s not what I’m suggesting. My final question is, with respect to what you just said, to get the core business cash flow positive that (inaudible 01:11:32) has got to go from 16 down to 12 million. I want to know why it hasn’t been done, and whether you think it can be done, because there’s many of us to do believe, with respect to Singapore in Amsterdam, the headcount is way too high.

Robert O’Malley

So, what’s your question again, frank?

[Frank Hoffman – Capricon Advisers]

Why haven’t you take in the op ex down from 16 maybe to around 12? Because, the headcount is still too high, and if you’re trying to stabilize the core business, that op ex has got to come down because it’s out of equilibrium with your revenue and your margins.

Robert O’Malley

Well, the op ex is at 15, and ─

[Frank Hoffman – Capricon Advisers]

No, it’s at 15.6.

Robert O’Malley

Well that’s with restructuring charges, at a run rate its 15.

[Frank Hoffman – Capricon Advisers]

Okay.

Robert O’Malley

15.1 to be exact. And, as we enter the year, our plans were to be profitable. So, our plans, at the op ex we’ve got, and the op ex is down 20% year-over-year, so it’s not that we haven’t been doing anything. That 20% year-over-year has been with relatively strong foreign currencies. Now they, just in the last 30 days, swung the other way, so we’re going to see some benefit in an op ex standpoint, a reversal of increases that we’ve had. And, that’s clearly a target of opportunity for us, is to look at where we’ve got operations around the world, and some cases some of what we’re doing are duplicate of operations of what our contract manufacturers can supply and we’ll obviously take a good, hard look that, and what are our new economic initiatives.

[Frank Hoffman – Capricon Advisers]

I understand, Bob, and one, just follow up question, what’s the headcount today relative to 12 months ago?

Robert O’Malley

The headcount today is 298 people, hold on a second. It’s down 8% from last quarter.

[Frank Hoffman – Capricon Advisers]

The point of my question is, as you’re finding the numbers for me, and I certainly appreciate that, with this company and the commodisized market, and the economic climate that we’re going to be in for a couple of years, you’re going to have to figure out how to do more with less, and so far, a lot of investors that I’ve talked to, don’t see that.

Robert O’Malley

Yeah, this is, as Business Week called it, the era of austerity, on their cover story week or so ago. We’re down modestly from last quarter, it was 306, the quarter before it was 303, but in addition to improving the headcount we’ve also done a lot to bring some work that was being supplied by contractors and bring that work in house. For example, some of the (inaudible 01:14:45) compliance testing we’ve brought in house. So, that’s probably not – the op ex is a more important indicator of how well we’re spending.

[Frank Hoffman – Capricon Advisers]

Fine, and I do have one last question, and I’ll turn it over to somebody else. And, this is directed to Lisa, with respect to one of the investors or a couple of them about our road shows, that’s, obviously, very typical CFO and CEO stuff, and I know you guys have been working really hard internally, but I did have a conversation with you in which you told me you had not even talked to Wells Fargo Capital, which is the third largest shareholder in the company. That’s very disturbing, and to some of the other investors on the call, I mean, they need to understand that you guys are talking to investors in trying to lay out a strategy to keep them in the stock, and what I heard, and fix my thinking if I heard something wrong, is most of the people I heard on the phone say is there’s no communication other then we’re selling projectors and we have USB now, and we’re differentiating. So, my suggestion is you need to talk to some of these people, that’s what a CFO does.

Lisa Prentice

Right, thank you. We will.

[Frank Hoffman – Capricon Advisers]

Thank you very much.

Robert O’Malley

Okay, thanks, Frank.

Operator

I’d now like to turn the call over to Mr. O’Malley for closing remarks.

Robert O’Malley

Thank you very much, Nora, and thank you all for your participation in the call today, and your interest and support of InFocus. We look forward to speaking with you next quarter, and based on a lot of the feedback probably much, much more often and sooner than next quarter. Thank you all very much.

Operator

Thank you for your participation in today’s conference, this concludes the presentation, you may now disconnect. Have a great day.

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Source: InFocus Corporation Q3 2008 Earnings Call Transcript
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