Question-and-Answer Session
Operator
(Operator instructions) Our first question comes from Andrea Wirth – Robert Baird.
Andrea Wirth – Robert Baird
I was wondering if you guys could just first talk a little bit about raw material costs in the quarter. How were they versus your expectations, and have we now reached the high point in costs and have they now come down sequentially? I’m just trying to get a sense of where we are at there.
Doug Baker
They did come down from Q1 as we anticipated. I would say they came down in line with what we forecasted, so obviously less than we hoped. Our view that we shared in the first quarter that they would continue to fall sequentially is still our view. They were down in the second quarter. We believe they will be down again in the third quarter versus Q2, and they’ll switch to favorable, if you will, in the second half.
Andrea Wirth – Robert Baird
They’d be favorable overall for the second half?
Doug Baker
In the second half, they will be favorable versus second half of ’08.
Andrea Wirth – Robert Baird
In Q3, you still expect them to be a headwind, correct?
Doug Baker
They’ll be a help in Q3.
Andrea Wirth – Robert Baird
How should we think about pricing going forward? You saw 4% again this quarter. Should we assume that that pricing probably moderates a little bit, or how should we think about that going forward just given that raw material costs are subsiding a bit?
Doug Baker
I think what we discussed on pricing is that we believe we will successfully hold the pricing that we’ve achieved, but we do not believe we will be gaining new pricing agreements at the same rate we were last year; therefore, I think you’ll see slow moderation year over year as you go through the year.
Operator
Your next question comes from the line of Amanda Seguin – Jefferies.
Amanda Seguin – Jefferies
For the quarter, you guys came in at the top end of your range for Q2, but you’re narrowing the top end of the range for the full year. I was just wondering if you could walk us through what your thinking is there.
Doug Baker
The $1.95 to $2.05 which was our prior range for the year is a much wider range than we normally have. To recall, it’s a range that we established in early November when we were in the secondary moving the Henkel shares, and I think our feeling was as we moved through here that we wanted to give a better idea of how the year was developing and so narrowing it seemed like the wise course of action. Here is what I would say. We see our business improving. We are not counting on any material improvement from the economy. We hope we’re wrong. We haven’t been so far. We also believe that we’re going to continue to use the second half to invest in our business to assure that we have a very successful 2010 and beyond. We like the position that we’ve put ourselves in, and we want to continue to make sure that we optimize and take advantage of the market conditions that we’re seeing, which means competitors are stressed, we have a number of important investments we want to make that are going to get us both share and leverage, and we want to make sure we make them in the second half as well.
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