Investors Punish General Cable

HIGHLAND HEIGHTS, Ky. (TheStreet) -- General Cable(BGC Quote) shares fell 11% Monday morning after the company issued a profit warning at the end of a third-quarter earnings report that surpassed Wall Street estimates.

General Cable, which makes and sells copper, aluminum and fiber-optic wire for communications and power transmission, did all it could to direct attention to the fact that it does business in countries outside the U.S., calling itself in the first sentence of the earnings release "one of the most globally diversified industrial companies."

Why would it do so? Because, as most know, the sector into which the company sells -- residential and commercial construction -- remains nearly totally garaged in the U.S. Growth in the world's emerging economies, on the other hand, is expected to rebound at a much faster pace than the most-developed countries.

General Cable's business is evenly spread between North America, Europe/North Africa and what it terms on its consolidated statement of operations as "Rest of World." In the third quarter, the company said revenue from those regions totaled $364 million, $362 million and $356 million, respectively.

Still, the diversity that General Cable has been trumpeting could not prevent it from scaling back its earnings outlook, as the U.S. and Europe construction industries continue to stagnate and as metals prices remain high. To deal with this, General Cable said it will cut back on production in the fourth quarter. Thus, it said, it had to reduce its earnings forecast.