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Executives

Amanda Butler - Director of IR

William V. Hickey - President and CEO

David H. Kelsey - Sr. VP and CFO

Analysts

Ghansham Panjabi - Wachovia Securities

George Staphos - Banc of America Securities

Ross Gilardi - Merrill Lynch

Rosemarie Morbelli - Ingalls & Snyder

Mark Wilde - Deutsche Bank Securities

Claudia Hueston - JPMorgan

Robert Trout - Goldman Sachs

John McNulty - Credit Suisse

Rahul Agarwal - Marathon Asset Management

Jim Stanley - Merrill Lynch

Sealed Air Corp. (SEE) Q1 FY08 Earnings Call April 30, 2008 11:00 AM ET

Operator

Good morning everyone and welcome to the Sealed Air Conference Call discussing the company’s first quarter ‘08 results. This call is being recorded. Leading the call today, we have William V. Hickeyy, President and Chief Executive Officer and David H. Kelsey, Senior Vice President and Chief Financial Officer. After management’s prepared comments, they will be taking questions. [Operator instructions] We do ask that you please limit yourself to one question per caller so that others will have a chance to ask their questions.

And now at this time I’d like to turn the conference over to Ms. Amanda Butler, Director of Investor Relations. Please go ahead Ms. Butler.

Amanda Butler - Director of Investor Relations

Good morning everyone. Before we begin our call today, I’d like to remind you that statements made during this call stating management’s outlook or predictions for the future are forward-looking statements. These statements are made solely on information that is now available to us.

Our future performance may be different due to a number of factors. Many of these factors are listed in our most recent annual report on Form 10-K or quarterly report on Form 10-Q. We have also posted supplemental financial information and reconciliation of non-GAAP measures that we expect to discuss on our website at sealedair.com in the investor relations information section under Reports & Filings.

Now I’ll turn it over to Bill Hickey, our CEO. Bill?

William V. Hickey - President and Chief Executive Officer

Thank you Amanda and good morning everyone. I am Bill Hickey, President and CEO of Sealed Air Corporation. With me on the call today, in addition to Amanda, we have Dave Kelsey, our Chief Financial Officer. As an introduction I will provide a few highlights of of our business for the first quarter of 2008. Dave will then review select details of our financial results. And after Dave’s remarks, we will take your questions.

As you saw up by our press release issued earlier today, we expected that the first quarter would be challenging, due to rising raw material and energy cost, and continuing sluggish growth in the North American economy. In spite of this, we generated a modest increase in product price and mix, and held volumes steady, with a help of new product sales, and the recent acquisition of the Ethafoam and related product lines. We also achieved double-digit growth in our Vertical Pouch Packaging portfolio in our medical application business and in various emerging regional markets.

In the first quarter, our diluted earnings per share were $0.35, excluding the special items mentioned in our press release earlier this morning. We accomplished this earnings performance while absorbing raw material cost for the first quarter that was $37 million higher than the first quarter of 2007 and $11 million higher than the fourth quarter of 2007.

During the quarter, we anticipated continuing weak economic conditions in North America and higher input cost for the duration of the year. As a result, we focused on the following initiatives to mitigate the impact. First, we recently announced the operational exchange at one of our facilities in the U.K., which will improve our performance by moving certain equipment to other locations, while reducing headcount at that location.

We also announced the closure of a facility in New Jersey, shifting production to other existing facilities in the United States. We have implemented additional price increases in various businesses and regions of the world and we have targeted cost savings opportunities in SG&A and manufacturing for the year.

Looking ahead into the rest of the year, we plan on mitigating higher cost through a combination of efforts. Focusing on certain items in more detail, first, we are implementing additional price increases. We are on track to complete our conversion on to the SAP platform midyear in North America, which will enhance efficiencies across our global platform. Having brought all of our major European sites live on SAP last year, we will be simplifying our business processes in Europe in an effort to streamline that regions operations to increase efficiencies and support profitable growth.

We are on track with our global manufacturing investments and are investing in the final expansions of our new facility in Mexico, and the opening of our new facility in Poland later this year. And of course we will continue to stringently control headcount and spending.

Finally, we are diligently focusing our spending dollars on profitable growth opportunities for 2008.

Let’s take a look at our performance for the first quarter and review our sales results in more detail. Our first quarter sales increased 8% to set another record of $1.2 billion. Excluding the favorable effect of foreign currency translation, our sales growth was largely driven by a combination of the benefits from the recent acquisitions of the Ethafoam product lines and Alga Plastics, both of which are reported in the other category and increases in product price and mix.

We did see a combined 16% sales increase in the BRIC countries of the world as well as double-digit sales growth in the developing regions overall. Taking a closer look at our reportable segments in the other category; our food packaging business showed steady performance in the first quarter. Net sales grew at 7% or if excluding the favorable effect of foreign currency at 2%. Product price mix had a 1% growth reflecting the benefits of our December 2007 price increase, which were not fully realized in the first quarter.

Overall, volume growth grew just under 1%. We saw solid volume growth in the United States, Europe and Asia which all performed above slaughter rates. These results were offset by volume declines in Australia and New Zealand and in Latin America. Australia was impacted by unfavorable weather conditions, and Latin America was impacted by the EU embargo on Brazilian meat imports.

Operationally we continued the ramp-up phase of our new greenfield site in Shanghai, China; and Monterey, Mexico; and added new production lines in Latin America.

Looking ahead we anticipate continued strength in our European and U.S. food packaging businesses. We expect stronger year-over-year meat production across all meat categories in the United States, and we expect processing to increase in Australia in the second half of the year.

Additionally, we expect that the recent trade agreement to reopen the full export of U.S. beef to South Korea will have a favorable impact on this segment starting mid-year. We do expect however, the current meat supply constraints in China and Brazil to persist.

In Food Solutions, we increased our sales by 10% in the first quarter or 3% excluding the favorable effect of foreign currency translation. Product price mix increased by 3% in the quarter due to the benefits again of our December 2007 price increase. Unit volume growth was relatively steady on a year-over-year basis with a 0.4% increase. Although we achieved over 20% volume growth in Asia and mid-single digit volume growth in Latin America and Australia, New Zealand, volume growth was offset by a decline in unit volume in the United States.

This was due primarily to a decline in the Case-Ready portfolio as one large retailer has opted to use an alternative packaging format for a portion of their fresh meats. We’re participating in this alternate format however the results of those sales are reported in the food packaging segment. Excluding the slowdown in our North America in Case-Ready results, the Case-Ready portfolio grew by over 10% outside the United States in the first quarter.

Additionally we have made good progress among other large U.S. retailers and are currently piloting the Case-Ready format with a large multi national retailer in Shanghai, as we continue to expand Case-Ready’s presence in the marketplace. Also another retailer in the United States is piloting our newest Case-Ready format Mirabella in the next few weeks.

The Vertical Pouch Packaging portfolio did continue to grow at double-digit rates during the quarter with particularly strong sales in North America. Lastly, our Ready Meal Solutions continue to expand with simple steps, our microwaveable heat-and-eat system increasing nearly 20% year-over-year.

Looking ahead, assuming economic conditions continue to soften, we feel well positioned in participating in the packaging of fresh, prepared meal that are accessible to many people at an affordable price.

Moving on to our protected packaging segment, first quarter net sales were 0.6%. Excluding the impact of foreign currency translation and the unfavorable impact from the sale of the small product line, first quarter sales decreased slightly by 2%.

We experienced moderate growth in product-price mix, again reflecting our recent December 2007 price increases. This was offset by volume declines in all regions except Asia, which had a 7% volume increase. Volume was negatively impacted by the continuing weakness in the North American and European economies.

Looking ahead, we anticipate continued slow growth rates in both our North American and Europe Protective Packaging business due to regional economic condition, which we expect to partially offset with sales of new products.

Lastly, our other category increased net sales by 39% or 33% excluding the favorable affect of foreign currency translation. The primary growth driver in the first quarter were the acquisitions of Alga Plastics in medical packaging in August, and the acquisition of Ethafoam Products in November. Volume increased 6% primarily due to strong sales in Europe and Asia in our medical business. This was slightly offset by declining sales volumes in North America in the specialty materials business.

Looking ahead we will continue to focus on integrating and scaling our recent acquisitions. Our manufacturing teams are focused on establishing the internal manufacturing assets for Ethafoam Product lines, to transition production in house and improving operating margins.

Before I hand it over to Dave I’d would like to discuss our updated full year 2008 guidance. Based on the market conditions that we see today, as well as the other items I just reviewed we now expect our full year 2008 diluted earnings per common share to be at the lower end of our previously announced range $1.64 to $1.74. This range of course includes charges of approximately $21 million or $0.11 per share, which are expected to be incurred related to the implementation of our global manufacturing strategy.

Excluding these charges we now expect our 2008 earnings to be at the lower end of our previously announced range of $1.75 to $1.85 per share. The change in our guidance will reflect the following updated assumptions.

We now expect full year average raw material cost to be considerably higher than initially anticipated earlier this year. Addition price increases to recover these higher costs are planned.

Our consolidated unit volume growth rate in 2008 will be lower than we initially expected, which is consistent with expectations for slow growth in the global economy.

We’re also assuming a lower full year effective tax rate of 29.6% and we expect to maintain operating expenses of less than 16% of net sales. Combined with being disciplined in our spending, mitigating rising costs in an efficient manner and investing wisely in our growth programs, I expect that our efforts will position Sealed Air as a more efficient, more profitable and more nimble organization as the global economy recovers in late 2008.

Now, I’m going to turn the call over to Dave Kelsey to review some additional details of our financial performance. Dave?

David H. Kelsey - Senior Vice President and Chief Financial Officer

Thank you, Bill. As Bill mentioned, our sales grew $1,117,000,000 for the quarter, more than 80% of our $83 million of revenue growth where $69 million came from our international operations.

Stable foreign translation contributed $57 million, while international volume grew 3% to $3 million or five-tenth of a percent. For the quarter, approximately 56% of our revenue came from outside the United States. The net revenue impacts from acquiring this divesting businesses was $14 million or 1.3% for the quarter, two acquired businesses contributed $20 million to 2008 revenue in our other category and we also netted out $6 million of first quarter 2007 contributed by the small protective packaging product line that was sold last year.

For those participating in the call, who’d like additional detail, tables posted on our website sealedair.com present the percentage of sales by geographic region, the components of the change in net sales by business segment and by geography, and the impact of foreign currency translation on sales by geographic region.

Moving through our statement of operations, the company’s gross profit was $305 million for the first quarter compared with $314 million in the first quarter of 2007. For the total company, resin costs in the quarter were $37 million higher, compared to the prices paid for resins in the first quarter of 2007. The selling price increases that we announced late last year and then in the first quarter lagged our increased cost for resins and thus the benefits were not fully realized in the first quarter of 2008. Cost related to our global manufacturing strategy did not have a meaningful impact on our first quarter gross profit comparison to 2007.

Marketing, administrative and development expenses were $186 million compared to $178 million in the first quarter of 2007. As a percent of revenue, these overhead expenses declined to 15.8% compared with 16.3% in the first quarter of 2007. Excluding foreign currency translation of $9 million, marketing, administrative and development expenses were flat, compared to the first quarter of 2007. Cost containment efforts were implemented earlier in the first quarter, as we assessed that economic conditions were likely to compare unfavorably to our earlier outlook for 2008.

Operating profit was $117 million for the first quarter, a decline of $19 million from the first quarter of 2007. The combination of price and mix contributed $13 million to offset only partially, $37 million of higher resin costs. Operating profit as a percent of sales was 9.9%. Food Packaging operating profit was flat compared to the prior year and Food Solutions reported a modest year-over-year decline in operating profit. Protective Packaging operating profit was $12 million below 2007 due to unfavorable sales volume and resin cost that also impacted gross profit.

The other category, which includes specialty materials, medical applications and our investments in new ventures, namely NanoPore and Biosphere reported a year-over-year decline of $3 million of operating profit during the quarter. This decline was attributed to the more pronounced impact of resin cost increases on our Specialty Foams business.

Interest expense was $35 million essentially unchanged from 2007. Other income for the quarter was $200,000 a decrease of $4 million compared to last year. The company expensed an additional $1 million in the quarter for services performed by third parties on a transaction for which work has now ceased. Foreign currency exchange losses were $2 million unfavorable in the first quarter of 2008 compared to 2007.

Interest income was $4 million this year compared to $5 million in last year’s first quarter, in part, reflecting the movement of funds prepared for the repayment of debt in April. Income tax expense for the quarter was $21 million and resulted in an effective income tax of 25.4%. The lower tax rate for the quarter resulted from a favorable mix of earnings, as well as benefits associated with the repatriation of certain foreign earnings.

For 2008, our total effective income tax rate is estimated to be 29.6%. This rate is lower than the 31% rate that we guided at the end of January, due primarily to a more favorable mix of earnings, as well as benefits associated with the repatriation of certain foreign earnings.

Diluted earnings per common share were $0.33 for the quarter compared to $0.67 in the prior year. Excluding those items detailed in our supplement information available on our website, sealedair.com, diluted earnings per share were $0.35, compared to $0.39 for 2007, a decline of 10%. As stated in today’s earnings press release, this EPS is consistent with achieving the low end of the EPS guidance range, we provided in our January press release.

I will conclude with some key cash flow and balance sheet items. Our combined balance of cash and short-term investments at March 31s, was $431 million. Some noteworthy sources and use for the cash during the quarter were; EBITDA of a $162 million, capital expenditures of $41 million, share buybacks of $27 million, and the dividend payment of $19 million.

Our quarter end accounts receivable totaled $796 million up a nominal $6 million from December 31st. Compared to March of last year, receivables investment increased $92 million or 13%, while our quarter-over-quarter sales increased $83 million or 8%.

Customer receivables balances outside North America were up double-digits with foreign currency translation contributing $16 million or 80% to the year-over-year increase. Also representative of our international business, VAT receivables were up $11 million year-over-year.

Inventory investment at March 31st was $642 million, up $61 million during the quarter. This higher investment is attributed to acquisitions, foreign exchange and normal seasonal increases. Compared to March 31st of last year, inventory investment was up $97 million or 18%.

Inventories in the U.S. were up only $20 million year-over-year. The increased investment in inventories outside the U.S. was attributable to $50 million of foreign currency translation and $22 million primarily to support our sales growth internationally.

Total borrowings at the end of March were $1.882 billion, an increase of only $10 million, primarily due to an increased in short term borrowings related to our Greenfield plant startup in China.

The outstanding balance of $300 million related to a debt issue maturing on April 15th 2008 is reported in current liabilities at March 31st As planned, we used our available committed bond capacity, including both our accounts receivables securitization program and our credit facility to retire these notes when they matured on April 15th.

Capital expenditures were $41 million for the quarter. Of this spending, $9 million was incurred on projects undertaken as part of our global manufacturing strategy. Looking ahead our guidance continues to be for 2008 capital spending to be in the range of $175 million to $200 million. This outlook includes $70 million necessary to complete the first phase of our global manufacturing strategy.

In concluding my comments our financial performance, I’d like to summarize the status of our global manufacturing strategy. The expected $70 million of capital investment in 2008 will bring our cumulative capital investment from 2006 through 2008 to $143 million. This will essentially complete the first phase of our global manufacturing strategy within our expected range of $130 million to $150 million.

We are producing and selling products from our Greenfield plant in China and our new location in Mexico. By this time next year we expect to be producing and selling product from our new site in Poland.

In addition to our capital investment we have previously estimated that other costs associated with expanding our global manufacturing base, and establishing centers of excellence, would be $30 million in 2008, bringing our total costs… our total for other costs to $58 million well below our original range of $90 million to $100 million. In summary, we currently are estimating that our benefits from these projects will be approximately $45 million starting in 2009 and increasing to $55 million in 2010.

Now, I would turn the call back to Bill and your questions.

Question and Answer

Operator

(Operator Instructions) Yes, sir, our first question today will come from Ghansham Panjabi from Wachovia Securities, Please go ahead.

Ghansham Panjabi - Wachovia Securities

Hey guys, good morning.

William V. Hickey - President and Chief Executive Officer

Good morning, Ghansham

Ghansham Panjabi - Wachovia Securities

You know, Bill, you noted in your comments that you expected the first quarter weakness. Are you suggesting that your first quarter earnings were in line with your forecast back from late January or was it some what lower than what you were thinking?

William V. Hickey - President and Chief Executive Officer

Our, actually, the first quarter was a little bit lower than we anticipated. If you remember Ghansham, when we talked about product cost this year, we anticipated, kind of a mirror image of 2007, where essentially, your peak input cost would be the first quarter versus the fourth quarter of 2007. If you remember the first quarter of 2007 input costs were down quite a bit. We expected the first quarter to peak input cost and then sort of flatten out and decline theoretically on a parallel basis with a lower ethylene prices. That doesn’t look its happening right now. But our view was that the first quarter, even as we expected would be the weakest quarter of the year, it just was a little bit less than we thought it was, Ghansham.

Ghansham Panjabi - Wachovia Securities

Okay. And in terms your protective packaging, the environment there… obviously costs have been an issue for a while now but it also looks like demand is an incremental issue as well. So what’s your strategy to, sort of, go out there and raise prices and there is weak top line high cost environment. Is that fair to say that you’re willing to walk way from business if you have to, as you try to push pricing there?

William V. Hickey - President and Chief Executive Officer

Ghansham, let me, sort of, go back a second to the first part of your question on the protective side, yes. Some of the sort of declines that we’ve seen is our consumer sales, which are those consumer Wrap Bubbles that sell in big box stores, mainly in the first quarter those were down 23%, primarily because a lot of this superstores have been cutting their inventories. In fact one of the office supply store has announced this morning that their sales were down 7% to 12%.

Ghansham Panjabi - Wachovia Securities

Right.

William V. Hickey - President and Chief Executive Officer

Product going into the housing industry about 10%, products going into the automotive industry goes down about 5%, products going in to RVs, boats, sports, recreation are about 10% and those that go to the luxury end and you see Bubble Wrap had a lot of luxury products and that’s down about 5%. So, clearly that segment of the economy, the consumer base segment is as weak as I’ve seen it in a long time. The 2001 slowdown was primarily a tech slowdown, this seems to be more consumer based.

Now, to get back to the second part of your question is, yes, we will put through price increases. We are prepared walk away from low margin business and our view is that with input cost being at the state they’re in, their may not be opportunities for marginal competitors to lower prices and still survive. That is what happens.

Ghansham Panjabi - Wachovia Securities

Okay, that’s very helpful. Thank you.

Operator

And moving on our next question will come from Banc of America securities, George Staphos. You line is open. Please go ahead.

George Staphos - Banc of America Securities

Thanks, hi guys. Good morning. Trying to the stay to the one question format here, could you cover it all a bit in more detail, the shift that you saw in Case-Ready, both in terms again what your large customer is doing in terms of their format or material, why that made for a shift in your segments and I didn’t hear this, have you mentioned? Did you actually lose share with this customer where you sold before and now no longer. Thanks.

William V. Hickey - President and Chief Executive Officer

George, let me go back to the Case-Ready. First is outside the U.S., the numbers are still extremely positive, 10 plus percent outside the U.S.. As I said down 3% in the U.S., 3.5, that is primarily due to one large retailer taking a certain number of cuts of their case, meat cuts and putting them in to what is called an overwrap package. An overwrap package is a very traditional polystyrene trade with PVC overwrap film, much as of it were done in the back of the store and then those individual packages are put in a large barrier bag and that large barrier bag is then filled with a gas to extend shelf life and then that bag is shipped from the supplier to the distribution center to the retailer. And then the retailer opens that bag. And when the retailer opens that bag essentially they have got 72 hours shelf life.

So that’s what they’ve gone to, there’s been a change in the merchandised management at this particular retailer. They were looking for a way to drive up their beef sales and may have thought, may be a change back to the original in-store format would work. Kind of the negatives of that, it’s a higher cost format. Its got a, sort of a negative environmental impact in terms of the additional truck loads of meat that have to be delivered. In terms of the PVC film In terms of the spoilage that occurs on the meat because you only a three days shelf life when you open the package.

I understand that, that retailer has been now open to considering alternatives that may have a better environmental footprint. So there are various studies looking at alternative packaging. And George, if you remember, I’ve said this for a number of years. I think the ultimate Case-Ready format has yet to be developed. I think it’s another step in the process and we are participating in this overwrap bag.

There may be one or two other people participating in it. There’s not a lot of technology in the overwrap bag. Its basically a large polyethylene type barrier bag. All it has to do is hold the gas for a couple of days. So its not really a high tech format and that’s why we sort of put it in the Food Packaging and we’ll see how it turns up.

George Staphos - Banc of America Securities

Great, thanks. I’ll do that.

Operator

And we’ll now move on to our next question comes from Ross Gilardi from Merrill Lynch. Your line is open. Please go ahead.

Ross Gilardi - Merrill Lynch

Good Morning thanks guys.

William V. Hickey - President and Chief Executive Officer

Good Morning.

Ross Gilardi - Merrill Lynch

Could you just talk a little bit more about what you are seeing in emerging markets, its just seem like the core revenue growth in Latin America and Asia was a quite a bit lower than we’ve seen in some time, could you… I think you touched on some of the trends, but if you could elaborate a little bit more there and what you expect for the balance of the year?

William V. Hickey - President and Chief Executive Officer

Yeah, sure let me give two things on Latin America and the two biggest markets are Brazil and Mexico. Mexico; actually our business along Casa Maca Dor [ph] which is that area right on the border between the U.S. and Mexico, most of that manufacturing ends up going to the United States. And in Mexico, where the growth was hurt in effect was the area where the Maca Dor are where the products are essentially being manufactured in Mexico and sold to the U.S. So, the US slowdown has really affected our protective sales in Mexico.

The other part of Latin America is Brazil and Brazil the EU has imposed a… an embargo on Brazilian meat and its basically has to do within our recent EU policy regarding food safety and traceability standards, which essentially requires the Brazilian exporters to have a track and trace system for all of their exports to Europe. And as a result, I think there are 9000 exporters of meat in Brazil and I think at this point 300 of them have been qualified under the new EU rules.

So the combination of the industrial effect in Mexico on the protective side and EU meat embargo on the Brazilian side where the primary factors in the lower growth in Latin America. The rest of the business in Latin America is pretty healthy and particularly, in Brazil, the Food Solutions business was up, the Protective business was up in Latin America. So overall, there are two impacts in Latin America.

Coming to Asia, there is a meat supply issue in China. Meat prices are up 40%. Pork prices are up 40% plus. They have had an animal disease, which is a new one on meat called blue-ear. It’s started late last year. It’s resulted in a sizable number of animal deaths, which also has contributed to the higher prices. And again in China, if you look at the other segments of our business, our growth is still quite good. But the meat sector particularly pork has had a negative impact on the business in China.

Hopefully takes the two pieces together, but overall, I think both Dave and I said in our comments is, we are still pretty upbeat on the BRIC markets, on the emerging markets and so far this year, even including those factors of the pork supply problem in China and the EU exports in Brazil and the negative impact of the U.S. economy on some of the Mexican manufacturing. We still managed to produce 15% plus growth overall in the BRIC countries.

Ross Gilardi - Merrill Lynch

So was that the higher pork price means lower pork… I mean as simple as higher pork prices mean lower pork consumption in China or is there something else to understand there?

William V. Hickey - President and Chief Executive Officer

No, but I would say that pork consumption is probably down, interestingly enough one of our U.S. customers has received an order from China for x million pounds, I had the number, I just don’t remember it right off hand, has received an order to export x million pounds of U.S. pork to China to supplement the pork supply. And net-net, that material is going over frozen, so we will not see any really affect of those sales on our business in China, since that pork is coming out of the U.S.

Ross Gilardi - Merrill Lynch

Okay. Thanks very much.

Operator

And we will now take our next question from Rosemarie Morbelli from Ingalls & Snyder. Please go ahead, ma’am.

Rosemarie Morbelli - Ingalls & Snyder

Good morning, Bill. Bill, could you give us some details on the additional cost reduction program that you’re just starting now on both the manufacturing side and the overhead expenses?

William V. Hickey - President and Chief Executive Officer

Sure. I can go through kind of the laundry list. But, yeah, they are the obvious ones, is one, wholly in control of headcount in terms of any open positions; two, doing a better job at managing our travel. The company spends about $80 million a year on travel when you are global organization, that’s a pretty big number. And to the extent, we can say 10% of that that has meaningful impact when it flows to the bottom line.

On our manufacturing operations, we’re primarily focused on reducing scrap. Despite all the efforts we’ve made, we still regenerate something like 10% of our production ends up being scarp because of changeovers and again taking 1% out of that is a pretty sizable amount to bring right to the bottom line. Those are the biggest items Rosemarie on the list, but Dave Kelsey and I went over the list a couple of days ago, is probably two pages long but 80% of the dollars were in the items I just covered.

Rosemarie Morbelli - Ingalls & Snyder

So you have a dollar amount of additional savings coming from this new program, I am…I mean translating this as being an addition to the $45 million savings you generated by the current program underway.

William V. Hickey - President and Chief Executive Officer

Rosemarie, we do have it. Its in our guidance number, its how we get to the low end of the guidance.

Rosemarie Morbelli - Ingalls & Snyder

Okay. Okay and what if I may, what would…. what would need to happen in the current environment for you to actually not reach that low end estimate.

William V. Hickey - President and Chief Executive Officer

While, we’re doing everything we can in terms of reaching the low end and that’s based on the assumptions I’ve made, which is considerably higher input cost, the price increases and the cost savings. All of which I think are very achievable. I just want to put a little color on the price increase. Essentially we’re looking to bring down to the bottom line, something in the range of 2% to 3% price increase, to close the gap basically to get to our earnings number. And if you look at the 2005 and 2006 yearend P&L statements, you’ll see that 2% price number is a number we have achieved twice before. So I’m very, very confident that we will achieve the price impact. So I’m at this point comfortable that, we’ve covered as many bases we possible can to get to where we said we’d be this year.

Rosemarie Morbelli - Ingalls & Snyder

Thank you.

Operator

And our next question we will hear from Deutsche Bank’s Mark Wilde. Please go ahead.

Mark Wilde - Deutsche Bank Securities

Good morning, Bill.

William V. Hickey - President and Chief Executive Officer

Good morning.

Mark Wilde - Deutsche Bank Securities

Just a question about the protein markets. And I wonder if you can just explain to us how you think about this right now? It sounds to me like this very high feed costs are leading farmers to push a lot more of livestock to market right now, which I think is dampening price, but at some point we are going to see the other side of that, which is less livestock going to market at higher prices. Can you talk about how that is going to affect your business in the short-term and then a couple of quarters down here?

William V. Hickey - President and Chief Executive Officer

Sure, Mark you have hit upon one of the complexities of the protein chain that I have talked about on numerous occasions and here is a time I won’t go through the whole thing. But there’re really three levels in the protein chain and they are all affected very differently by what’s happened.

For example in the beef business in the U.S., they are basically the cow-calf people, who essentially are those that breed and raise calves. Then there is the feedlot operators, who essentially take them to maturity and fatten them up. Then there are the processors which take the animal and convert it to meat. And our customers are the last of those three. And depending on the leverage in the channel, rising feed prices affect different people. And rising or falling selling prices affect different people.

So there is not a simple answer to say what the long-term impact is going to be. You are correct in that. There’d be more animals coming to market this year than we had previously anticipated because of the high feed prices. But beef prices had been and they had been high and it just come down a little bit because the herd size has gotten as bad as the operator held cattle off the market to maintain higher prices. The people who are our customers, the processors who buy from the feed lots, are negatively impacted in this entire process because they’re paying higher prices for animals and getting lower prices from consumers.

So, it’s a continually changing environment but you are right, go back ahead, in the short term, it will result in more cattle coming to market. You may see this following up next year because at some point, they have to hold back some animals to breed, to rebuild the herds for the future and when that occurs, is anyone’s guess.

Mark Wilde - Deutsche Bank Securities

Okay. But do you think, that in fact could be, nine to twelve months out yet before we can kind of see the flip side of this?

William V. Hickey - President and Chief Executive Officer

Right, right, yeah. You’re looking at probably at least twelve month out.

Mark Wilde - Deutsche Bank Securities

Yeah, okay, All right, that’s the answer I was looking for.

Operator

And we will now hear our next question from Claudia Houston from JPMorgan. Please go ahead, ma’am.

Claudia Hueston - JPMorgan

Thanks very much. Good Morning.

William V. Hickey - President and Chief Executive Officer

Good Morning

Claudia Hueston - JPMorgan

I appreciate all the color you gave on U.S consumer trends and I was just hoping you can provide little bit more detail on trends in Europe and then may be, more broadly just wondering if trends have started to stabilize at all in either the U.S, or Europe?

William V. Hickey - President and Chief Executive Officer

Let me comment in Europe, you’re seeing… Europe consumer trends are not as negative as the U.S. Some interesting comments in both France and in Italy, we have seen more of a slow down in France and Italy. than we’ve seen in other parts of Europe. Eastern Europe though continues to do well, I mean our business in Russia which is part of our BRIC business is up 28% for the first quarter. So the European consumer appears to be in better condition than the U.S. consumer and as far as consumers outside U.S. and Europe, we haven’t seen any significant change in either the Latin American consumer or the Asian consumer yet.

Claudia Hueston - JPMorgan

Okay. And then just in terms of has the trends stabilized at all or if could give us a sense if there is still maybe more room for weakness?

William V. Hickey - President and Chief Executive Officer

Well, that’s a tough question, because we’re kind of a coincidence indicator so to speak, so we really don’t have a lot of longer term visibility on the market. Usually the packaging end of our customers is a last thing they do. So that the extent that there are any changes going out, we’re generally more coincidence than leading. But our April number seems to be okay, I’ve seen no further deterioration in the month of April from where we have been, so I guess we’ll wait and see, Claudia.

Claudia Hueston - JPMorgan

Okay. Thank you very much.

Operator

And our next question will come from Mr. Bob Trout from Goldman Sachs. Please go ahead.

Robert Trout - Goldman Sachs

Hi, thanks. Good morning guys.

William V. Hickey - President and Chief Executive Officer

Good morning.

Robert Trout - Goldman Sachs

At the low end of your guidance range, what is your assumption for resin for the second half? Is that consistent with the consultants, and they are expecting like 5% 6% drop in polyethylene?

William V. Hickey - President and Chief Executive Officer

Let me answer. Tat has been our earlier estimate in the beginning of the year. In fact I was going to mentioned that when Ghansham asked the first question, where is said our expectations was that the first quarter would be the highest input cost of the year and that would gradually flatten out beyond that. And ethylene has actually come down and ethylene is one of the components of polyethylene. But what we are seeing and we are seeing now is that and may be your consultants are better than ours, may be I should talk to yours. But we are actually seeing somewhere in the low single digit cents per pound increases going forward from here through at least the third quarter. Whether it falls off in the fourth quarter, we don’t have that in our guidance right now. But you should know that our guidance is based on another several cents increase in input costs through the rest of this year.

Robert Trout - Goldman Sachs

Okay. Okay, and just a follow-up on resin with the new Middle East capacity for polyethylene and the others that’s supposed to come online. Can you substitute any of your current resin buys for the -- can you substitute some of the resin that’s coming online in the Middle East or what currently buy or is the formula strict enough where the new resin that’s coming out you might not be able to use it anyway?

William V. Hickey - President and Chief Executive Officer

No, no, we are able to use anything coming out of the Middle East. We actually do buy resins from different parts of the world. There is capacity in India, in Korea and some coming on in other parts of the world. The Middle East resin capacity expansions have been something we have all been waiting for. They have been delayed now for at least a year. I understand part of that delay is kind of steel shortages and engineering shortages and what had been, 2008 capacity additions are now looking like late 2008, early 2009 and there is a fair amount of capacity coming on stream. And we are able to use it and we look forward to it.

Robert Trout - Goldman Sachs

Okay. And then just lastly on pricing, you said 2% to 3%, I guess is your expectation for the -- or your hope for the rest of the year, is that across every business unit?

William V. Hickey - President and Chief Executive Officer

That’s company overall.

Robert Trout - Goldman Sachs

Okay.

William V. Hickey - President and Chief Executive Officer

And actually it breaks out differently by business units depends on what components they have in their particular product mix.

Robert Trout - Goldman Sachs

Okay

William V. Hickey - President and Chief Executive Officer

But the number is company overall.

Robert Trout - Goldman Sachs

Okay. And how much would you take in the first quarter or how much did you announce that may not as fully benefited the result?

William V. Hickey - President and Chief Executive Officer

In terms of price increases?

Robert Trout - Goldman Sachs

Yeah.

William V. Hickey - President and Chief Executive Officer

We had various increases. Again depending on the business, they were 4% to 6% in one business, 6% to 8% in another business and one of our business has higher 10% and there were different dates from late December, January 1st, February 15th, April 15th, there is sort of, each of our businesses has raised prices in different amounts at different times in both the end of ‘07 and early ‘08 in response to the particular input costs in their particular business. And the $13 million that rolled through the first quarter is not all of what we should get based on the announced price increases. So in my earlier comment saying the ability to recover was overall 2% by the end of the year. It’s still the range that we’re looking at and reasonably consistent with our price, our price increases in 2005 and 2006.

Robert Trout - Goldman Sachs

Okay, thanks. I have a couple others, then I’ll hop back in the queue.

William V. Hickey - President and Chief Executive Officer

Okay.

Operator

All right. And we’ll now hear from Credit Suisse, John McNulty for our next question. Please go ahead.

John McNulty - Credit Suisse

Yeah, good morning. With regard to the food businesses, it does seem like there is lot of puts and takes right now between Europe shutting down Brazil and it looks like South Korea is opening up. When we look at the volumes going forward, should we be… how should all this net out? Should we be thinking that given the volumes that you put up throughout rest of the year are similar to what you saw this quarter, should they get a better than this? Can you give us a little bit of help on that?

William V. Hickey - President and Chief Executive Officer

My overall view John is they will get a bit better later in the year. First of all, the first quarter tends to be the lowest quarter in terms of the food business. It follows all the eating to holidays, all the bulk poultry and beef and pork that are brought to market in the last quarter of the year, the summer sort of barbecue cookout, outdoor eating hasn’t started, it’s generally in a lot of parts of the wallop world this winter. So that it generally is the lowest quarter of the year in terms of meat production and in terms of what we see at out customers and in our own business. So even just seasonally, we will see increases through the second, third and fourth quarter. And as I said in response to an earlier question, we expect more animals to be brought to market this year than we had originally thought because of the high feed costs. So overall, my feeling is that production and our growth in the food packaging side of our business should improve as go through the year.

John McNulty - Credit Suisse

Okay. And then just one last question, with regard to W. R. Grace now, its now looking like they are going to be coming out of bankruptcy finally. Can you give us just a remainder as to what that means for you in terms of the timing of when you make your payment out, the stock, that type of thing?

William V. Hickey - President and Chief Executive Officer

Okay, sure John. It was… I was expecting that question from someone. As everyone knows W. R. Grace announced in early April and it has reached an agreement in principal with the asbestos personal injury claimants committee and the future claimants representatives and the equity holders committee, on terms for present and future asbestos specialist related personal injury claims.

Grace’s term sheet, which they published after their announcement states that the plan of reorganization will comply with Sealed Air’s settlement agreement and the way the mechanics of the process will work is that at such time as Grace is reorganization plan is submitted to the courts and then approved by the courts.

When its approved and when Grace comes out of bankruptcy, on that day, Sealed Air will make the payments under a settlement agreement, which is $512.5 million in cash plus accrued interest and 18 million shares of common stock, 9 million prior to the split and we in return will receive all of the indemnities that we bargained for as part of our settlement agreement and we will have all of the benefits of being cleared of any and all liabilities relating to the Grace asbestos liabilities.

And my feeling is you are still months and months away. I mean, I know there is an agreement in principal, but there is not necessarily, at least I’m not aware of a plan actually having been prepared or submitted and of course approvals are required from a a variety of other parties in the bankruptcy proceedings, including the property damage claimants and zone claimants, as well as committee of unsecured creditors. So by the time that all gets done, we used to say, its at least a year away, now I might change and say its probably under a year but probably not much under a year, I mean, I saw one of the Grace comments they expected to have their plan approved by the end of ‘08 or early ‘09 and that’s probably not bad planning but in my opinion, solely my opinion its likely to drag out a little bit beyond that.

John McNulty - Credit Suisse

And one question tied to that. With regard to the 18 million shares, is there some sort of a lockup period for the creditors or the party that’s going to hold them, so that they don’t just come right upto the market or have you?

William V. Hickey - President and Chief Executive Officer

Well, they have registration rights. They have registration rights so the shares they get cannot really just come right upto the market and so that they will come… I expect they will come to us sometime shortly after then and to go through the registration process and would just see how that develops, Sean.

John McNulty - Credit Suisse

Okay, great, thanks for the update.

Operator

And now we will hear from [Rahul Agarwal] from Marathon Asset Management. Please go ahead.

Rahul Agarwal - Marathon Asset Management

Thanks for taking my question. It’s a quick follow up on the previous one actually. In terms of the cash payment, can you give us some ideas as to what the total cash outflow may be as you see them today, and second, how do you plan to fund it?

William V. Hickey - President and Chief Executive Officer

Dave. I am going to ask Dave Kelsey answer that.

David H. Kelsey - Senior Vice President and Chief Financial Officer

The total cash out flow is a combination of the $512 million that Bill just cited plus accrued interest, which by yearend will be approximately $200 million. So we’re looking at roughly $700 million in cash if the settlement were to occur late this year. We have a cash balance on hand, as well as available committed borrowing capacity sufficient to make that payment went it comes to.

We also expect to have sufficient lead-time to consider a capital markets transaction to raise some of that funding longer term fashion, but that’s decision we’ll make as the date gets little bit closer. I also wanted to elaborate on the revious question on the 18 million shares. For those of you who haven’t followed us throughout this process, to point out that we do include those share in the calculation of our fully diluted EPS.

William V. Hickey - President and Chief Executive Officer

Thank you Dave. Operator, I’m going to take question from the internet, we’ve got a couple here I just want to respond to.

Operator

Certainly.

Unidentified Analyst

First question coming over the internet says, although the company is a leader in the packaging sector, do you see continued increasing competition effecting medium to long-term growth prospects for Sealed Air.

William V. Hickey - President and Chief Executive Officer

Thank you for acknowledging our leadership in the packaging sector, I do appreciate that. Competition is a factor but I generally look at competition as stimulus to get better to work harder, to be smarter. I think the impact is less on growth than our ability to continue to achieve the premium valuations we get on our products. But I really do not necessarily see it as an impact on our growth prospects for going forward.

Next question is from the Internet.

Unidentified Analyst

Since 2001, your sales have increased some about $3 billion to $4.7 billion or 54%, but our EBITDA has only grown about 2.5% over the same period resulting in almost an 800 basis points decline in EBITDA margins. Do you think that margins can get back to the 20% level in the long-term or has you cost structure or competitive environment changed permanently?

William V. Hickey - President and Chief Executive Officer

That’s a good question something we have talked about on a number of occasions. The principal factor in that -- in that 800 basis point decline in EBITDA, the margins is the $300 million plus of input costs, as we watched the oil go from $40 a barrel to $117 a barrel and the impact that has had on all the raw materials that we buy. As I said on numerous occasions, we spent a fair amount of our time chasing price increases to recover those costs and our ability to get back margins will occur when there is a more stable pricing environment. I don’t necessarily say it has to be lower. If we can just have a stable environment, we will work our way back to those higher EBITDA margins. But to clarify, our guidance has been 18% to 20% EBITDA margins. So we may have come off of that a little bit. But I do think 20% is a desirable target. And I think there is nothing fundamental in our business that would prevent us from doing that once we work all of these cost increases over the last several years through the channels and get our margins back up over time.

Unidentified Analyst

Third question from the internet sounds like you have decided to retire the April ‘08 notes, whether draw on bank facilities, either a plan to refinance the borrowing with longer return debt issue, what are your thoughts then about issuing something at equity component given where the stock is now?

William V. Hickey - President and Chief Executive Officer

Actually we have already paid off the April notes. Those are done. And most of it as Dave indicated in his comment were done with both cash on hand and borrowings under existing credit agreements. We have note plans, know even concept of anything with an equity component at this time. But let me let Dave comment on how we will work through this debt repayment over a little longer term.

David H. Kelsey - Senior Vice President and Chief Financial Officer

Probably, three things worth commenting on here. First; we do have a convertible debt issuance out there that goes back to 2003, so that is in the market today. For those of who’d like to invest in convertible securities, we have one available. Secondly, the expectation is on the short-term borrowings that we have incurred to retire the note in mid April that cash from operations over the coming year will be sufficient to reduce those borrowings. So there is nothing we are contemplating today as Bill reiterated to go to the capital markets to term out as they say those short-term borrowings. As we get closer to the settlement date on grades and that $700 million cash payment, we will evaluate a number of different funding sources and make the selection based on what we think will be the most effective cost of capital over future period of time. And I will throw in just comment as well that the settlement is tax deductible event for us. We’ve reflected that tax benefits as best we could estimated when we booked the settlement back in 2002. So there will be some netting down of our cash obligation as we close that event through our tax returns.

William V. Hickey - President and Chief Executive Officer

Thank you, Dave. Let me take, I’ve got two questions on Internet before I go back to the telephone.

Unidentified Analyst

One is, it’s sounds like additional potential PE cost increases are our primary driver for the guidance change rather than specialty resin changes.

William V. Hickey - President and Chief Executive Officer

I’d just say its overall input cost and more necessarily attributed to either PE or specialty, just say that that applies to our basic petrochemical input costs, both PE and specialty.

Unidentified Analyst

Last item on the internet, how would you characterize your appetite with respect to making acquisitions through the remainder of the year?

William V. Hickey - President and Chief Executive Officer

Sealed Air has always been an acquirer. As we said earlier, we acquired the the Ethafoam business from Dow Chemical Company back in November. We acquired Alga Plastics back in August of 2007. So, we’re always interested in the right fit both from a technology standpoint, product standpoint or a market standpoint. And I would think that as market valuations and purchase multiples have come down over the last couple of months that there might be an opportunity sometime in the remainder of the year, but clearly we have nothing in the works at this time. Okay. Operator, can I go back to the telephone questions.

Operator

Well, certainly sir. We do have three questions remaining in queue. We will hear from [Jim Stanley] from Merrill Lynch for our next question. Please go ahead.

Jim Stanley - Merrill Lynch

Hi, I just had a follow-up on your last comment of.., for one, meaning that you said as response to the internet question, that the updated guidance has a lot to do with all raw material cost I guess going out more than you originally thought. And maybe you already spoke to this and I missed it, but as I look at the first quarter and I am not sure exactly what you’ve said about for the year as far as volumes are concerned. It seems to me that the big disappointment here is more volume related, especially on food packaging side. And so, I was just, was curious as to what maybe your… this is… you already said this, but what you are expecting volume-vise through the rest of the year and has that significantly altered versus what you saw a month or two ago?

William V. Hickey - President and Chief Executive Officer

I did say before I handed the phone over to Dave. I highlighted what our guidance assumptions were at this point in time.

Jim Stanley - Merrill Lynch

Okay

William V. Hickey - President and Chief Executive Officer

And I’ll just highlight quickly. Our full year average raw material cost to be considerably higher. Additional price increases to recover the higher cost. Consolidated unit volume growth in 2008, lower than we initially expected.

Jim Stanley - Merrill Lynch

Yeah, I’m sorry.

William V. Hickey - President and Chief Executive Officer

Yeah and I think our expectations were somewhere in the mid-single digits, and we’re probably in the low single digits in terms of volume growth. So that’s the answer you were looking for.

Jim Stanley - Merrill Lynch

Okay, thanks

Operator

And we will take our next question from Mark Wilde from Deutsche Bank. Please go ahead.

Mark Wilde - Deutsche Bank Securities

Just as a follow on Bill.

William V. Hickey - President and Chief Executive Officer

Sure

Mark Wilde - Deutsche Bank Securities

First the freight and logistic issues around the world are getting bigger all the time. Can you just talk about what effect this has on your business both now and in terms of kind of thinking about this global footprint, manufacturing footprint?

William V. Hickey - President and Chief Executive Officer

Sure, actually the combination of freight cost and container availability has been in the news of late. Our own freight costs are really up in the single digits quarter-over-quarter, year-over-year because we try to manage how we run our freight operations. We do move products across the oceans and we do move products across the hemispheres. We’re finding that we have to schedule more carefully but we have had no really no issues with doing that.

Costs have gone up but the places where we’re locating our capacity, the places where we are adding investment and equipment and bricks and mortar, are China, Russia and Brazil and when that capacity comes on stream, its actually less freight intensive and less dependent on the shipping channels because in effect we’ll be manufacturing where the markets are growing, right now as I said earlier as we make product in the U.S. and Western Europe and we ship it to Latin America and we ship it to Eastern Europe and we ship it to Asia.

I’ve said numerous times that we’ve been currently supplying meat business in China from the U.S. and Australia. Now with our plant there we will take X amount of containers out of our network by putting in two new production lines in Latin America. We’ll take Y number of containers out of our network and by expanding production in Poland and Russia, we’ll take X number of truck loads out of our network.

So I’d like to think that the way we are planting our global footprint is not only where the markets are, but our net reduction in both transportation and logistics cost, as well as environmental footprint, because we’ll be generating less greenhouse gas by moving less material kind of shorter distances. So overall Mark, it’s a great question, I think it positions exactly where we want to be and I think that will be the right place to be in the long-term.

Mark Wilde - Deutsche Bank Securities

Yeah and then the near term, Bill, you haven’t like raise inventories in some of those emerging markets just to kind of cover yourself.

William V. Hickey - President and Chief Executive Officer

Dave, talked about inventory a lot, and the answer is yes, the answer is yes, we do. Its interesting but again, the net result of this ought to be lower inventories when this model is put in the place. I just know from our experience that from the time we get a product made in the U.S. to go to a customer in Brazil, it’s a 105 days. To average the 105 days, now x number of those days are inventory on the water or in one of our warehouses. But the extent that and a year from now or six months from now or two years from now, that customer will get product right in Brazil. It will be 15 days or 10 days instead of 105. Inventory will go down. Transportation will go down. We will have a happier customer. I will have a happier CFO and we will all win.

Mark Wilde - Deutsche Bank Securities

All right. Thanks, Bill.

Operator

At this time, we do have one question remaining in the queue and that comes from a follow-up question Goldman Sachs, Bob Trout. Please go ahead, sir.

Robert Trout - Goldman Sachs

Hi, thanks again guys.

William V. Hickey - President and Chief Executive Officer

Hey, Bob.

Robert Trout - Goldman Sachs

What’s your assumption for foreign exchange in your full year guidance?

William V. Hickey - President and Chief Executive Officer

Dave.

David H. Kelsey - Senior Vice President and Chief Financial Officer

It’s pretty much in line with what we saw in the first quarter. We are not really in the business of projecting where the dollar is going to go versus the euro. That’s clearly the one relationship that has the biggest impact on our translation adjustments. But we do have significant sales in Brazil, in Australia, in the UK. So those currencies versus the dollar also have an impact. For the time being, we tend to take the view that current exchange rates will stay in effect for the balance of the year. I am sure I will be proven wrong, but I am not sure in which direction.

Robert Trout - Goldman Sachs

Okay, okay.

William V. Hickey - President and Chief Executive Officer

If you have a insight, please tell us Bob.

Robert Trout - Goldman Sachs

Unfortunately, I’m not in the business of forecasting that either, but. And then just lastly the follow-up to that earlier question on Protective. I know there is a pretty significant decline in year-over-year volume this quarter and I know you said consumers weak. Are you seeing any indication that people are just trading down for some of the invitation – the cheaper invitation product, the Bubble Wrap or just different types of installation?

William V. Hickey - President and Chief Executive Officer

I don’t think we’ve seen that Bob, I think, primarily, I’ve seen just declines in consumption. I mean, I have some highlights that have been actually absolutely interesting. For example, one of our big Bubble Wrap customers in Mexico that’s located along the border and they shift to the U.S. I mean, they do blinds for windows, their volume is down 41%, we haven’t watched any share. We haven’t watched the customer, but essentially, this particular customer’s business is down 41%. We have another customer that does automotive lighting whose volume in the first quarter is down 29%. So I don’t feel we’ve lost much in the way of share. You probably always have somebody switching, it’s always a give and take in any industry in any business. But by and large, I would attribute the quarter to perhaps, the sort of weakest consumer economic environment we have seen and probably we as a country have seen in probably the last 10 to 15 years. Someone asked me if I thought it was over yet? Our April number don’t seem to suggest it is. I’m personally optimistic that by the time we get through the third quarter, things will look a lot better. But I’m not going to forecast the economy either.

But in the meantime, we are going to do the best we can. We’re going to sell as much as we can at the highest price we can. We’re going to keep every customer we can and we are going to find as many new customers as we can. And if I look back over the recessions, if I go back over the recessions, if I look at our Protective business as being the one that’s most exposed to that. The Protective business worst trough that I think I’ve seen in the last 15 plus years has been in the 3.5% to 4% volume range, not really dramatic because we’re so widespread. I think we had what 2.5 or so in the first quarter. So the worst that’s ever been in 15 years is four. I don’t expect this to get there, but we’ll have to see how the economy turns out. Hopefully I’m going to go to spend their rebate checks and we’ll have a good third quarter. But do appreciate the question. Economy is fastening right now because I am listening to different industries. We report quarterly earnings and I guess this is the quarter you want to be commodity producer. This is not the quarter you want to be a manufacturer, hope it turns around next couple of quarters.

Robert Trout - Goldman Sachs

Great. Thanks very much.

William V. Hickey - President and Chief Executive Officer

Okay. Are there anymore questions operator?

Operator

There are no further questions from the phone audience at this time sir.

William V. Hickey - President and Chief Executive Officer

Yeah, I really want to thank everybody for participating in the call. It’s been the challenging quarter, but at least I hope you heard us both of us with prepared comments as well as answering our questions. We’re all focused on the long-term. We’re not going to let the short-term destructions in the economy dramatically change how we want to be. We’re going to stick to our growth initiatives. We’re going to increase our efficiencies. We’re going to reduce our cost, because we truly believe being a global player in the world economy is a place where we want to be. We’ll continue to capitalize on a global footprint and our diverse portfolio. We will drive for lower cost and we will continue to invest in innovation. Long-term, we want to deliver superior results to all of you. You’ve heard me say this before and I will say it again, we have navigated to these challenging environments before and we continue to steadily expand our business. We will continue to build on these strengths, I think they will serve us well through 2008 and beyond. And I am still very happy and proud to be a Sealed Air shareholder. Thank you all very much.

Operator

And that does conclude today’s teleconference. We would like to thank everyone for their participation and wish everyone a great day.

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