Question-and-Answer Session
Operator
Certainly. (Operator Instructions). Our first question will come from Douglas Chudy from KeyBanc.
Douglas Chudy
Good morning
Rob Amen
Hi Doug.
Douglas Chudy
Hi. I just want to check with you, you noted the inventory correction in Q1. Do you think this is largely complete or should we expect this to flow through into the next quarter or next couple of quarters?
Rob Amen
Doug, as I indicated it’s really impossible to know whether or not it’s complete until after the fact. I think the overhang remains with us. I think it will be an impact in the second quarter and will slowly diminish over the course of the year.
Douglas Chudy
Okay. And secondly you mentioned that new project activity picked up year-over-year in the first quarter, is this on a consolidated basis, can you maybe breakout what you are seeing in Flavors versus Fragrances? I assume maybe the Flavor side was a little bit stronger?
Rob Amen
Well, I actually I made the comment referencing Fragrance and it’s interesting to know we are seeing a pickup of Fragrance projects here in the United States and that’s very very good and as I said we are winning up a good share of those things. So I feel better about the Fragrance business as we move through the year. The Flavors business is doing terrifically around the world and the activity is up, the win rates are up, we are winning in the categories that we said. I mean, Doug indicated, but I have to tell you, I am really impressed with our Flavors team and what they are achieving.
Douglas Chudy
Okay. And just finally, one other question. I know you don’t provide specific guidance, but given the current state do you think that the Fragrance in a tough start to the year, the Fragrance segment can get I guess local currency growth positive in 2008 or you think that may be a challenge at this point?
Doug Wetmore
I think at this point in time, first of all, we have very difficult comparisons in Fragrance for the first half of the year and that will certainly be an element, but only an element. But I think we are seeing very good growth outside the United States and while, as Rob mentioned, you have to be somewhat cautious about the US market. We are pretty confident that overall we will deliver local currency growth for the Fragrance business unit during the course of ’08.
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