Question-and-Answer Session
Operator
(Operator Instructions) Our first question comes from Myles Walton - Oppenheimer & Co.
Myles Walton - Oppenheimer & Co.
I was hoping you could provide, thanks for the color by market. I was wondering if you could do quickly the same thing in terms of your 2009 outlook by segment, first off.
Martin Benante
On the revenue side, Flow Control between 990 and 1.10 billion, Motion Control, 650 to 665 and Metal Treatment, 250 to 255. However, I do have to point out that those ranges include reallocation of our end-all business from the Motion Control segment to the Flow Control segment and that’s approximately $45 million in annual sales.
Myles Walton - Oppenheimer & Co.
And then on the margin side?
Martin Benante
On the margin side, Flow Control between ten and a half and ten and three quarters. Motion Control around 11 and 3/4 and Metal Treatment around 17%, approximately.
Myles Walton - Oppenheimer & Co.
And two follow-ups to that, 11 3/4 in Motion Control is that helped by the movement of end-all or is that your expectation for improvement in that segment?
Martin Benante
It’s mostly improvement, but you’ve got to remember that 2008 was dampened by a whole host of different things. So, it is partially eliminating all the negative stuff they got hit with in 2008 as well as improvements.
Myles Walton - Oppenheimer & Co.
I guess assuming that VMetro returns to break-even or modest profitability and that the current peg stands where it is on a Forex basis, which is a little bit of help, is the right way of thinking?
Martin Benante
Right.
Myles Walton - Oppenheimer & Co.
And then the 17% in Metal Treatment, it looks like Forex; the translation effect of Forex is about 140 basis points in the quarter alone. Is that kind of the driver there or are you seeing facilities starting to be underutilized and kind of weighing on the margins as well?
Martin Benante
Let me just say, we did, just so we can try to explain the Forex, we did build into our guidance a blended, I’d say a hedged forecast that we received from third party banks, is built into that. So to some degree, what you’re seeing in the fourth quarter of 2008 you know is kind of built into our guidance to continue at least in the beginning of the year and then temper down throughout the year, but we did use the forecasted rates for 2009. So the answer to part of it is that and the other is just that business is volume sensitive, as you know, and as their forecast moves down in volume and part of it is just margin impact on that.
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