I'll now turn you over to John Scannell who will talk about cash flow and other balance sheet items.

Thanks Bob ……………..Good Morning.

I would like to follow the same format as last quarter. First I'll discuss cash flow in the quarter and provide an update for the year. Then I'll speak to our recent financing activities. I will talk about our tax rate and finish with some other items from the balance sheet.

Q2 Cash Flow

Our Free Cash Flow was breakeven, an improvement of $29 million over the first quarter. Net debt decreased by $4 million in the quarter. The reduction was the result of the translation effect on our overseas cash deposits.

Cash flow from Operations was positive $21 million, $25 million higher than Q1. The improvement was a result of slower growth in working capital. Capital expenditures were down from $25 million in Q1 to $21 million in Q2 while Depreciation and Amortization in the quarter was $15 million. Interest payments totaled $13 million while our cash tax payments were $12 million.

We are maintaining our forecast for Free Cash Flow for the year at positive $5 million. We anticipate that our cash flow from operations will come in at $95 million and our Capital Expenditures will be about $90 million. As we said last quarter, this forecast assumes we will receive $20 million from Boeing for work performed on the 787. Our discussions with Boeing on this subject continue and we were encouraged by the recent news that Spirit AeroSystems has received a cash payment from Boeing.

Financing

We closed an expansion to our senior revolving credit facility in March. This increased our capacity from $600 million to $750 million and reset the term to 5 years. The additional funds will support our continued growth --both organic and through acquisitions. Given the tough credit market conditions we were very pleased that each of the banks in our credit facility supported our expansion and we were able to complete this transaction with an over-subscribed offering.

Taxes

Our effective tax rate in the quarter was 32.7%. For the year we are forecasting an average tax rate of 31.6%. The reduction for the second half will come from some tax benefits associated with foreign taxes and R&D tax credits.