General Cable Q1 2010 Earnings Call Transcript

Volumes in Brazil are picking up nicely in the second quarter after a weaker-than-expected first quarter due to a relatively slow start, resulting from the rescheduling of shipments for some major transmission projects to later in the year. In addition to the massive transmission projects that are in the pipeline, of which we have already booked over 150 million of orders to be delivered over the next two to three years, that has recently been billions of dollars of investments approved in additional power distribution and power generation projects, including hydroelectric. Even in Central America, infrastructure projects that were put on hold during the economic crisis are beginning to restart.

One region that has continued to struggle is Europe, particularly Spain. Based on the equity market reaction, the recent S&P downgrade of Spain appears to have been expected and probably reflects the reality in the Spanish economy that we have been describing for some time. Given these ongoing economic challenges, the company is taking additional actions, focused on Spain to lower production costs further through permanent reductions in manufacturing personnel. We expect to incur approximately $9 million of related charges in the second quarter, which we've included in our earnings outlook.

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