Question-and-Answer Session
Operator
(Operator Instructions) Our first question comes from Larry Solow with CJS Securities.
Larry Solow - CJS Securities
Could you maybe just discuss on the imaging side; first of all, it seem like organic growth, there may have been kind of flat sales or maybe a little bit down; could you tell me what Copley contributed. Was it kind of a $20 million kind of run rate minus the $5 million for the inventory reduction?
John Millerick
I think in Q4 Larry, Copley contributed $15 million in revenue.
Larry Solow - CJS Securities
Okay, so that implied kind of maybe flat to slightly down on the imaging side ex-Copley. I know they had been running, 15% plus or less six quarters and clearly there has been slow down at the OEM level for several quarters. Did this kind of all catch up to you in one quarter or is there any more color you can add to that?
John Millerick
I think if you look in quarter-over-quarter medical imaging back in Q4 of ’07 was $52 million versus $67 million this year. I’d say it’s pretty even if you pull Copley out, it’s probably flat.
Larry Solow - CJS Securities
Right, and then my question is we’ve kind of been looking for a slowdown, just based on what’s been going around the industry and where we’ve seen at the OEM level; you have some additional problems with tomotherapy; so my question kind of is you’ve been able to grow revenues even in the last couple of quarters despite the slowdown around you, the 15% even 20% range; why this quarter, not that it suddenly surprised me, but why all of a sudden do you think it’s going flat even slightly down? Did it all kind of catch up to you in one quarter, can you add any color to that?
John Millerick
I would say if you look at the end-user market, depending on whether you’re looking at CT or MR, there is typically somewhere in the neighborhood of a six to 12 month lag from order to shipment. So with the downturn in the OEM side on CT, it actually started at least a year ago. There was some lag in there and that’s why we saw some reduction in the demand at the high-end, mainly driven by the DRA which caused the reduction in demand in the United States, which was pretty much targeted toward high-end CT systems.
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