Question-and-Answer Session
Operator
(Operator Instructions). Our first question comes from Jeff Johnson – Robert W. Baird & Co.
Jeff Johnson – Robert W. Baird & Co.
Couple things here, Bill and Bret combined, just trying to understand the guidance as far as how it gaits in Q3 and Q4. Bill, I think in your comments you were talking on the earnings side there on how we should think about Q3 a little more pressure. But Bret, in your comments were they more or organic growth related that maybe we take a sequential step down a bit in Q3 before picking up a bit in Q4?
Brett Wise
Well, I think it's potentially both Jeff, and that's a good question. The guidance that we have out is a $1.80 to a $1.90 a diluted share and of course we don't do quarterly guidance, but as we look at where things stand we know the impact we had last year when we raised prices, a little bit higher then we usually do and we had more dealer stocking in Q3 and then more liquidation of the inventory in Q4.
Well, this year we expect to have less stocking in Q3 which of course depresses a little bit the internal growth and earnings. And then we expect to see just the opposite in Q4 where because we won't have the destocking that we had in 2008. So it could have a modest effect on both.
Jeff Johnson – Robert W. Baird & Co.
Okay, I guess more than anything trying to understand in Q3, if we had a one to two point organic growth drag this quarter from fewer selling days the worldwide internal growth comp actually gets a little easier in Q3 versus Q2. So just trying to figure how much of this may be conservatism on your part on the organic growth side for that to maybe tick down in Q3 versus there's something else there I may be missing?
Bret Wise
No, I don't think you're missing anything. It's just the two issues that I think our important to note is we did have the less selling days in Q2 and that hurt the organic growth number. I think in Q3 we're even on days, and Q4 I think there's one more selling day then the prior year. Is that right? So the biggest impact on us in Q3 because the days are even with the prior year is whether our dealers want the inventory in advance of the price increase versus the prior year.
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