Question-and-Answer Session
Operator
(Operator Instructions) Our first question comes from the line of Bill Ong with American Technology. Go ahead.
Bill Ong – American Technology Research, Inc.
Your breakeven point seems to about $50 million. Can you talk about what type of breakeven point you can expect as we move on through the rest of 2008? And, where you can help to reduce further costs?
William I. Turner
I think our breakeven is just a touch over $50 maybe $52 million right now and we’re working to bring that down. So $50 to $52 would be a good forecast.
Bill Ong – American Technology Research, Inc.
So, you don’t have any near term plans of lowering it other than just the normal progression of trying to find cost reductions throughout the company?
William I. Turner
Well, we have no formal writ planned but we are looking very hard at discretionary expenses, temps, contractors, anything that is discretionary. So, we’re chipping away at that and we think that we’ll probably be able to drop op ex by about $1 million from Q4 to Q1.
Bill Ong – American Technology Research, Inc.
You do plan to roll out a number of new products, any plans of slowing them down a little bit just in light of a weakened environment right now.
David L. Dutton
Actually, we’re being more aggressive about it. We think in this environment, as Bill mentioned, we are using our balance sheet to invest in some tools and get them in position so as the next cycle starts to move up we’re actually ready to capitalize on those movements and gain share especially in our new products this is a critical point to get them into the market regardless of the overall market conditions and get them ready for the next technology note expansions.
Operator
Our next question comes from the line of Patrick Ho with Stifel Nicolaus. Go ahead.
Patrick J. Ho – Stifel Nicolaus & Co.
A couple of questions just first for Bill; what was cash flow from operations? And, what do you expect the pro forma tax rate to be in 2008?
William I. Turner
Cash flow from operations was $2 million for Q4 and $49 million for the year. Pro forma tax rate for 08 will probably be about 14%.
Patrick J. Ho – Stifel Nicolaus & Co.
For both of you guys, in terms of the qualification Nexion with additional customers, you mentioned that in the past that you’re starting discussions. Has that process started with additional customers? And, if you can describe how many other customers have you potentially talked to about Nexion?
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