Natural gas usage is increasing rapidly due to its advantageous environmental characteristics, superior heat efficiency, and growth in other applications such as petrochemical feedstock. According to the International Energy Agency, or IEA, the consumption of natural gas will exceed that of coal by 2015. EIA projects that global natural gas usage will grow 2.4% annually from 2002 to 2020 compared to 2.0% for oil and 2.3% for coal.

Liquefied natural gas, or LNG, is expected to be the fastest growing segment of the natural gas value chain. New supplies of natural gas are largely found in areas that are long distances from the consumers of natural gas. In circumstances where pipeline transport is not feasible, natural gas must be converted into a more compact, liquid form, in order to effectively transport it to the required location. Products that enable the liquefaction of natural gas and re-gasification of LNG for transportation and storage are critical to the LNG industry.

In natural gas processing, customers employ cryogenic equipment to separate and purify natural gas and then to further separate natural gas into its component elements such as ethane, propane, butane, other natural gas to liquids, or NGL, and by-products such as helium. In petrochemical processing, customers use cryogenic separation and purification processes to convert natural gas elements into ethylene (the basic building block of plastics), propylene and numerous other industrial chemicals.

Growth in the industrial gas market is driven by the underlying demand for products that require oxygen, nitrogen, argon and other air gases. Producers of industrial gases separate atmospheric air into its component gases using cryogenic processes. The resultant liquid gases are then stored and transported for ultimate use by a wide variety of customers in the petrochemical, electronics, glass, paper, metals, food, fertilizer, welding, enhanced oil recovery and medical industries.

The Company’s principal products within the E&C segment are focused on process equipment, primarily heat exchangers and LNG systems, which include cold boxes and LNG vacuum-insulated pipe, used by major natural gas, petrochemical processing and industrial gas companies in the production of their products. The Company’s products in the E&C segment include heat exchangers, cold boxes and LNG vacuum insulated pipe. The Company is a leading designer and manufacturer of cryogenic heat exchangers. The Company is a leading designer and fabricator of cold boxes. The LNG vacuum insulated pipe product line consists of vacuum-insulated pipe used for LNG transportation within both export and import terminals.

Through its D&S segment the Company is a leading supplier of cryogenic equipment to the global bulk and packaged industrial gas markets. The Company is a leading supplier of cryogenic bulk storage systems of various sizes ranging from 500 gallons to 150,000 gallons. The Company is also a leading supplier of cryogenic packaged gas systems of various sizes ranging from 160 liters to 2,000 liters. The Company’s line of cryogenic components, including VIP, engineered bulk gas installations and specialty liquid nitrogen end-use equipment are recognized in the market for their reliability, quality and performance. The LNG vehicle fuel systems product line consists of LNG and liquid/compressed natural gas refueling systems for centrally fueled fleets of vehicles powered by natural gas, such as fleets operated by metropolitan transportation authorities, refuse haulers and heavy-duty truck fleets. The Beverage liquid CO2 systems product line consists primarily of vacuum-insulated, bulk liquid CO2 containers used for beverage carbonation in restaurants, convenience stores and cinemas, in sizes ranging from 100 pounds to 750 pounds of liquid CO2 storage.

The bioMedical segment consists of various product lines built around the Company’s core competencies in cryogenics, but with a focus on the medical and biological users of the liquids and gases instead of the large producers and distributors of cryogenic liquids. The Company’s medical oxygen product line is comprised of a limited range of medical respiratory products, including liquid oxygen systems and ambulatory oxygen systems, both of which are used for the in-home supplemental oxygen treatment of patients with chronic obstructive pulmonary diseases, such as bronchitis, emphysema and asthma. The biological storage systems product line consists of vacuum-insulated containment vessels for the storage of biological materials.

Gross profit for the three months ended March 31, 2006 was $37.0 million versus $24.6 million for the three months ended March 31, 2005 and reflected an increase of $12.4 million.

Operating income for the first three months of 2006 was $15.8 million an increase of $6.2 million compared to operating income of $9.6 million for the same period of 2005.

Net interest expense for the three months ended March 31, 2006 and 2005 was $6.5 million and $1.0 million, respectively.

For the three months ended March 31, 2006, financing costs amortization expense was $0.4 million, an increase of $0.4 million compared to the same period in 2005.

Net income for the three months ended March 31, 2006 and 2005 was $6.0 million and $5.5 million, respectively.