Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Gretchen Montgomery – Deutsche Bank.
Gretchen Montgomery – Deutsche Bank
It seems like in the summer months the consumer will experience a fuller flow through of commodity prices given gasoline prices as well as food as companies are taking off some of the protection from earlier in the year. What are your thoughts about demand elasticity going forward?
Tim Smucker
If you think about our product categories that we’re in, we’re in a lot of staple type businesses and people that are eating home more because they don’t want to travel as much or don’t want to eat out as much we think our product categories that we’re in and the brands that we’re in will do quite well and actually have done quite well during this period. We normally do fairly well in a rough economy. And we’re off to a very good start.
Gretchen Montgomery – Deutsche Bank
Have you seen that benefit from the shift from away from home eating to at home eating? Have you started to see that yet?
Paul Smucker Wagstaff
On the food service side we’ve seen a little softness in our restaurant business however one of the benefits we have is we have the school market which is very stable and it continues to grow then our healthcare market is also doing very well, that’s growing. It’s kind of offset and we’re in good shape.
Operator
Your next question comes from Farha Aslam – Stephens.
Farha Aslam – Stephens
On the P&G transaction, P&G shareholders do they have any lock for a period of time post the transaction?
Richard Smucker
No.
Farha Aslam – Stephens
You guys have a lock up or sort of a restriction that you can’t repurchase shares for two years.
Mark Belgya
That’s correct, that’s part of the reverse morris trust.
Farha Aslam – Stephens
Could you just share with us a little bit more detail on your comment that your pricing has now caught up with your commodities. What level of pricing have you had to take in your products and when you say that is that because your hedge on your commodities you pretty much know your costs?
Tim Smucker
The answer to your second question is correct. Our hedging our commodities we know our costs certainly most of fiscal ’09 but our price increases vary quite a bit by categories depending on which categories we’re in. I’ll let both Steve and Vince speak to that.
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