Question-and-Answer Session
Operator
Thank you. (Operator instructions) Our first question comes from Michael Cox with Piper Jaffray. Please state your question.
Michael Cox – Piper Jaffray
Thank you and congratulations on a very nice quarter.
Bert Grisel
Thank you, Michael.
Michael Cox – Piper Jaffray
My first question is on the backlog. I was hoping you could provide an update on the mix of the backlog between domestic and international, does it mimic those 55% to 45% split that you’d noted or is it more heavily skewed towards international?
Bert Grisel
What you see is in overall this year we will probably around 55%-45% revenue split. Going forward I think it’s fair to say that if we are at the end of the year 2009 it’s very likely that we will see the split more skewed towards 60%:40% international-domestic, or may be even 65%:35%.
Michael Cox – Piper Jaffray
Okay, that’s very helpful. Could you also describe the impact of the significant commodity price volatility that we have seen? You noted this to some extent in your prepared remarks, but to what extent is this having an impact on project pricing or your expectation for margins going forward?
Bert Grisel
Typically the Company has not entered into any commodity hedging especially on the metal hedging on the metal futures. So what has happened and this is what I explained a little bit in the comments just a minute ago is that our margin has slightly eroded if you want on the back of higher commodity cost increase. Typically if the Company takes on a project it calculates the commodity prices at the moment of tendering, which means that in the, let’s say, past six to nine months, we have incurred the increased price of commodities. The flip side of that is that actually for the project that we have recently won, the benefit now is basically for us and those sort of prices have been fixed at a moment where commodity prices were still higher than they are today.
Michael Cox – Piper Jaffray
Okay. That’s very helpful. And if you don’t mind, a coupe of additional questions. And the – could you provide a mix of government funded project sales of your revenue is in projects that are funded by governments, globally? And then what impact do you see from a project delay perspective that seems to plaguing several construction markets?
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