Question-and-Answer Session
Operator
(Operator instructions) Your first question comes from Curt Woodworth. Your line is open.
Warren Shane
Hi, Sal, this is Warren Shane [ph] in for Curt Woodworth.
Salvatore Fazzolari
Hi, Curt.
Stephen Schnoor
Hi, Curt.
Warren Shane
Hey, I was just wondering if I can get a little bit more color on the ’09 guidance. You gave some pretty good color but I was just wondering in terms of the oil price, it’s going to be a tailwind to your margins but what oil price are you assuming for ’09? And also steel utilization rates in U.S. and Europe, can you give us some color on what you are assuming.
Stephen Schnoor
Yes, we are – as far as fuel cost, Curt, we are very conservative. We are assuming on average much higher than it current is today. I think today the oil price is about $70. We are assuming it more closer to the high 90s, if I recall right. So, somewhere between $90 and say $95 a barrel so because you don’t know where it’s going to end up on average for the year. So that’s – it’s somewhere close to $100.
Warren Shane
Okay.
Salvatore Fazzolari
And also as far as utilization rates, and we’ll give you more color on this December, we are – we have quite a few projects that are real projects. That is we are currently moving equipment to markets in India, the middle – certain Middle Eastern countries where we have not operated in the past or we have not operated to the extent that we will be operating as well as a few other geographies, including a little longer term we think there are some opportunities for us in China as well. So, we have a lot of projects underway, lot of initiatives. Equipment is being moved right now as we speak in many cases. We have some projects already in hand and others to come. So, we are being very cautious on where we take the equipment.
If we see any significant deterioration in rental rates, we are going to redeploy that equipment elsewhere. We are not going to play that game of continuing declines in – so what I am trying to say is, we have a very solid base business in both Mill and Access. The wheels are not falling off this thing as I think the world or as the analyst community may think it is. We think we have a very solid base and as I mentioned in my comments we do not expect much in the first half. And so, our forecast is predicated still that we are going to have a weak first half 2009, particularly the first quarter. First quarter is our seasonally weak quarter, anyway. We do expect to have a first quarter that’s not going to be too exciting.
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