Question-and-Answer Session
Operator
Your first question comes from David Begleiter - Deutsche Bank.
David Begleiter - Deutsche Bank
Paul, any further insights to the backlog and any cancellations or delays that you’ve seen recently?
Paul E. Huck
Yes, Dave, we have not seen any of our projects cancelled. We have seen our projects delayed. And you can see that in the reductions in capital spending. The other thing in which we’re seeing as far as the backlog is concerned is that on the order side, I think that we’re going to see delays in orders going out. People are not going to make a lot of long term decisions at this point in time with the economic uncertainty that’s out there.
David Begleiter - Deutsche Bank
And just on electronics, obviously a very severe environment. Any structural erosion in electronics profitability and long term electronics operating margin targets?
Paul E. Huck
No, Dave. As we take a look at the business long term, we continue to take the right actions and decide the business correctly. A lot of the reduction which you’re seeing here is around our electronics business. They’ve been the one which has been hardest hit on the volume side and so we’re taking the right actions to do that. The commitment on the margin target remains for us.
Operator
Your next question comes from Robert Koort - Goldman Sachs.
Robert Koort - Goldman Sachs
Firstly, can you offer us any rays of hope out there that you’ve seen some improvement after some de-stocking period in your end markets? Has there been any improvement in trends? And then secondly, I think Paul if I do the math, based on what you’re saying about this current very weak quarter, it would imply a year-on-year improvement second half fiscal ’09 versus second half fiscal ’08. And just wondering how you get comfort around what might be some optimism things there that things are better than the prior year.
Paul E. Huck
Bob, if we take a look at on the rays of hope for things, I don’t think I’m seeing it in the operating rates of my customer base. The good news, which I already gave you, was that in fiscal ’08 and fiscal ’09 so far the refining of hydrogen business has held up very well. And so that is a very good performance for us. So I think we’re happy with that as we take a look at that.
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