Question-and-Answer Session
Operator
(Operator Instructions) Our first question is from Fred Buonocore CJS Securities.
Fred Buonocore CJS Securities
Good morning. Nice quarter in the face of some challenges. My first question relates to your '09 guidance, assuming SG&A remains roughly similar, tax rate roughly similar, all things being equal in that regard, your guidance appears to imply fairly minimal gross margin improvement relative to the second half of '08. Even given higher volumes, what would I expect maybe lower raw material costs, and what one would hope would be efficiency improvements at Power/Vac, can you kind of reconcile that for us please?
Pat McDonald
That's a long reconciliation question, Fred. As we have talked about on various conference calls, we have been improving all throughout the year. As we always give in our guidance that says we are trying to get back to the best period of our peak before. We're getting pretty close to that. I don't know that we're going to see the step function changes that we have seen in the past over the quarters as it relates to operating efficiencies and productivity. I think we will continue to see improvement, but it's not going be the size that we saw in this last fiscal year.
Don Madison
Incrementally, we will continue to show improvements as we go forward. Again, as we talked about, quartertoquarter performance will vary based on the projects that are actually shipped during the period. But the rate of improvement will become more and more challenging as we go forward.
Fred Buonocore CJS Securities
Then my followup relates to the sequential bookings decline. Should we take that to indicate maybe a slowing in demand from the oil and gas sector, realizing your quote activity is still good? Or is this kind of just quartertoquarter lumpiness?
Pat McDonald
As we have talked about, we do have a lot of quartertoquarter lumpiness, especially with some of the size of the projects that we have. I think we would be remiss to say that there are not some issues as it relates to the timing of jobs going forward in the future. We do believe that our order input in the fourth quarter was impacted by the hurricane because not only were we down, but our customers were down and not placing orders at the same time. As I think right now, we can probably say that our first quarter order input will exceed our fourth quarter order input.
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