Question-and-Answer Session
Operator
(Operator instructions) Our first question comes from the line of Matt Miksic of Piper Jaffray. Please proceed.
Matt Miksic – Piper Jaffray
Hi, good morning. Do you hear me okay?
Rob Shallish
Yes, fine Matt.
Joseph Corasanti
Yes, good morning.
Matt Miksic – Piper Jaffray
So, thanks for taking the questions. On FX, just some clarifications. You'd mentioned in the past that you are looking at hedging facilities to help offset some of the bottom line impact of currency fluctuations. Does Q4 reflect that, or are we going to see some of the benefit of those efforts in Q1 or anytime in 2009?
Rob Shallish
The hedging activities that we have been involved with through last year and the fourth quarter deal with hedging the transactions associated with out inter-company balances. So, we bill our foreign subsidiaries in a local currency such as the Euro, and they pay as back in Euros and we translate that to the US dollar.
If there are changes in FX rates during that interim period between billing the customer – billing our subsidiary and receiving the cash, we take those adjustments to the P&L – or have to take those adjustments to the P&L immediately.
So in order to avoid losses and I guess gains as well on those kinds of transactions, we've been hedging that portion of our FX situation since September of '08. With regard to our revenue, the flow of sales into the company, in 2008, we have not done any of that hedging, nor have at this point at least entered into any hedging transactions for '09.
Matt Miksic – Piper Jaffray
Okay. And clarification on the breakout you gave of some of your exposure to foreign currencies, I missed it, did you mention the British pound?
Rob Shallish
Yes, the pound is – of our total exposure to foreign currencies, that would be 15% of our exposure. So it’s 15% – 30% of our sales are exposed to foreign currency.
Matt Miksic – Piper Jaffray
Got it, so 4.5% of total or whatever.
Rob Shallish
Yes.
Matt Miksic – Piper Jaffray
Got it. So FX – the other thing I guess I would ask is, I know this is the first time you've given Q1 guidance, but you came in a little bit below our number, below consensus, and I’m trying to – it’s probably not a fair question, but if you had to put your finger on something that we were missing, and I know currency was part of it or I think it was for the first quarter, was there anything else factoring into your thinking about Q1 guidance?
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