Question-and-Answer Session
Operator
Thank you. (Operator instructions) Our first question comes from Mike Sison with KeyBanc.
Mike Sison – KeyBanc
Hey, good morning guys, nice quarter. Just out of curiosity, did you generate any savings this quarter or could you sort of quantify how much savings you did generate from what you have accomplished in '07?
Jim Kirsch
Are you speaking to the restructuring?
Mike Sison – KeyBanc
Yes.
Jim Kirsch
I think it's fair to say that as you look at the incremental numbers we talked about, in electronics we talked about 3 to $4 million. That spaced out pretty evenly because it's fundamentally head count reduction, Mike. In the European side of that, we will get more in the second half versus the first because of the Rotterdam situation.
Mike Sison – KeyBanc
Okay. Then if I take a look at the electronics business, how much bigger is solar now in '08 versus '07? And was that the – you sort of had some margin improvement to 6.6 versus 5.9 excluding precious metals. So, my question is, soft of did solar's profitability really kick in because of mix. And the dielectrics, dilute that a little bit? Or was that mostly the cost savings of the improvement?
Jim Kirsch
The solar has been growing at about 15% on the material side. And the other side of the business that I mentioned in my call, which would be the surface finishing, also we showed nice double-digit growth. So, what is occurring is our higher margin, higher-growth product lines are outpacing the lower margin, lower-growth dielectric paste and powders.
Mike Sison – KeyBanc
Okay. And to get to your goal from where you are at now, what is sort of left to do, just to continue to grow? You have done most of the cost savings that you suggested. Is it just to fill up the plants and grow the business?
Jim Kirsch
Well, organically, you have to get electronics to that 40% gross margin. We are on our way to doing that.
We've got to, in terms of our inorganics business, that's got to deliver double-digit operating margins at the end of the day. So, it's a combination of finish the restructuring, continue to grind away on cost and expense, particularly shared services in our company, and also to continue on the path of growth that we've exhibited top line growth in the two businesses I mentioned.
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