Question-and-Answer Session
Operator
(Operator instructions). Your first question comes from David Strauss from UBS. Please proceed.
David Strauss – UBS
Good morning.
Ron Sugar
Good morning, David.
Wes Bush
Good morning, David.
David Strauss – UBS
Look, Jim – looking at your sales guidance, it looks like that you are assuming flat to slightly lower sales in the second half. Is that right? And if so, what’s driving that?
Jim Palmer
Good morning, David. Essentially the strong – really strong sales growth that we have seen in electronics for the first half of the year, I don’t know that – I expect to continue at about the same level. If you look at last year, we had very strong sales growth in Electronics in the second half of the year which continued into the first half of this year and then into the second half of next year, so – second half of this year. So essentially, we are catching up with the growth that we have experienced last year and continuing into this year and then continuing for the balance of the year, but the rate of growth will slow.
David Strauss – UBS
Okay. And then on, by segment, I have been hearing updates in terms of your margin guidance and specifically looking at ships I think you had said previously that 7% will be a good performance. Obviously with the charge now, it is going to be tough to get there. What should we kind of look for out of ships on the margin side for the full year now?
Jim Palmer
Yes, David, maybe I have missed it in my comments. But I had about a 5% margin rate for shipbuilding as my thoughts about guidance for them for the balance for the year.
David Strauss – UBS
Okay. I made a mistake. I apologize. And then Jim, just an update on pension, kind of year-to-date performance and maybe if you could some sort of – some sort of help in terms of how we should think about it for 2010.
Jim Palmer
Through June, we are positive to 2%, 2.5% and that kind of range in terms of pension performance as – so that the issue is essentially in thinking of that pension expensive in 2008 go to performance on the plan and about a 100 basis point move in performance versus the 8.5% long-term assumption is about kind of $35 million impact on 2010 expense.
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