Q1 2008 DAVIS HENDERSON INCOME FUND (English) Earnings Conference Call - Final.

Original Source: FD (FAIR DISCLOSURE) WIRE

OPERATOR: Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Davis & Henderson Income Fund Conference Call for the first quarter of 2008 ended March 31st.

I would like to remind everyone that this conference call is being recorded today, Wednesday, April 30, 2008 at 10 AM Eastern time. I will now turn the call over to Catherine Martin, Chief Financial Officer of Davis & Henderson Income Fund. Please go ahead, Ms. Martin.

CATHERINE MARTIN, CFO, DAVIS & HENDERSON INCOME FUND: Thank you. Good morning, everyone, and thank you for attending. Your main host today is Bob Cronin, Chief Executive Officer of Davis & Henderson.

Before turning the call over to Bob, I'd like to advise you that the statements to follow include forward-looking information within the meaning of applicable securities laws. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the business or developments in Davis & Henderson's industry to differ materially form the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. Information about the factors that could cause actual results to differ materially from anticipated results or performance can be found in the Fund's annual information form available on SEDAR or in the press release announcing the results of the first quarter of 2008 ended March 31st. Now over to Bob.

BOB CRONIN, DIRECTOR AND CEO, DAVIS & HENDERSON INCOME FUND: Thank you, Cathy, and good morning, everyone. We had a solid first quarter that unfolded as we expected. Cash flow continued to be strong. We made good progress with our strategies, and as anticipated, we saw an impact on our revenue related to cheque reordering patterns.

We also announced an increase in our monthly distribution to $0.153 cents per unit. We're pleased with this increased, which is supported by the performance of our business and recognizes our intention to not have tax within the Fund. This increase, payable June 30th to unit holders of record May 30th, will take our annualized distributions to $1.84 per unit. This represents a 7.2% increase over the April monthly distributions and it is the 11th increase since the business went public in 2001.

Now, I'd like to comment on our operating performance. Consolidated revenue decreased slightly in the first quarter of 2008 compared to the first quarter of 2007. This decrease was primarily attributable to fewer cheque orders in our D&H segment compared to Q1 of last year.

As we've discussed in past conference calls, early quarters in 2007 benefited from increased accelerated cheque orders related to changes in the imaging standards of cheques in Canada. So, in Q1 of 2008, we're comparing to a Q1 of 2007 that had unusually strong order volume.

Additionally, many of those incremental orders would have been subsequently received in the latter part of 2007 and through 2008. As such, the impact is made that …