Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Kevin Maczka – BB&T Capital Markets.
Kevin Maczka – BB&T Capital Markets
I want to touch on visibility in general because I think last quarter you did something that you don’t normally do which is provide a more detailed outlook two quarters out instead of just one. Obviously some things change and you just described some of those. Can you comment on visibility in general that you have in your three major businesses?
Ed Campbell
Across the 17 businesses we have and product lines across the three segments it does vary greatly I’ll put a caveat right out front around my comments. At EFD for example substantially everything that we sell we ship the same day we get the order so we have literally no visibility. At the other extreme have one business in the Adhesive segment where the average lead times are well in excess of six months and so we have quite a bit of visibility.
More generally if we look across the businesses our backlog averages 45 days so that is obviously less than a quarter and as we look out one quarter at a time there is not a small degree of forecast that we’re relying on not just the backlog but the quoting that we’re doing for some engineered systems. We look at momentum factors around spare parts kind of purchases and the like as well as standard systems.
Over time we have done reasonably well with our forecasting for the near quarter. When we go out beyond that we’re now delving into economic analysis as to the pace of end market growth and we’re getting outside our comfort zone and as a matter of practice we don’t believe it’s helpful for us to project more than one quarter.
The reason we did give the extended preliminary look back in May for the fourth quarter of this year is that we were concerned that the momentum that we had announced in the second quarter and was embedded in our third quarter guidance was not going to be extending into the fourth quarter so we did in fact have a volume underlying the specific numbers. The volume forecast in quarter four back in the May guidance for quarter four that was down considerably from what we shipped in quarter two.
We thought if we gave our best estimate it would be helpful for analysts and investors to at least have some perspective on the outlook that we were seeing. I don’t expect us to continue to do that.
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