Question-and-Answer Session
Operator
Thank you. Ladies and gentlemen, we will now conduct a question and answer session. If you’d like to ask a question please press *1 on your telephone keypad. A confirmation tone will indicate your line in the question queue. Press *2 if you’d like to remove your question from the queue. For participants using speaker equipment, it will be necessary to pick up your handset before pressing the * keys. One moment as we poll for questions.
First question comes from Chuck Murphy with Sidoti and Company. Please proceed with your question.
Chuck Murphy - Sidoti
Good morning guys. Just wondering, as far as the integration issues that you experienced in the third quarter it seems like you feel pretty good that you are back on track here. Could you talk about maybe what would improve, specifically maybe where you still have some work to do?
Tom Vacchiano
Sure. Of course, one of the things that helped a lot was our product mix from Q3 to Q4. You’ll remember back in Q3 we talked about the effect, for example, Heidelberg being an extraordinarily high contribution in Q3 and in Q4 we moved back to a more normal contribution. That was one of the more natural fixes.
Also we were able to make progress in our professional services business where in Q3 we really struggled and in Q4 they bounced back and again helped us. So that was a product service mix. So that helped us. And of course volume in Q4 always helps with manufacturing absorption rates and so we always get a nice hit there.
On the flip side we made a little bit of progress, for example, in freight costs and freight recovery. But we did not achieve anywhere near what our goals are for 2008. So, there’s a mix of things that helped us, which we thought would help us. There is a mix of things where we’re making some progress but there’s more to be done.
Chuck Murphy - Sidoti
Yeah. I think you had mentioned something about something maybe ERP implementation not going as quickly as planned.
Tom Vacchiano
Yes, well we had what we lovingly call the ?big bang? which occurred in the third quarter and in the big bang there were a fairly high degree of what we call in (inaudible) and kind of band-aids to keep everything together and to keep our customers having a reasonable experience and those band-aids or experiences where things aren’t working as efficiently as you thought do cause incremental or extraordinary kinds of costs. We are making progress there but I’ll tell you that we won’t be through that big hoop until probably sometime towards summer. There is still work to be done.
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