General Cable Corporation Q2 2010 Earnings Call Transcript

There were also adjustments to the research and development credits of $3.1 million in France. While the reemergence of seasonal demand patterns is encouraging, many of our businesses are still moving sideways when seasonality as we moved and we therefore remain cautious about the second half of this year as there remains a great deal of uncertainty surrounding the nature and pace of the economic recovery.

Brian will take you through the details of the financials in a bit. I thought I would spend some time talking about how I currently see our business environment. Many of the positive trends we identified in the first quarter have continued into the second quarter, particularly as it relates to the stabilizing of demand for certain products in the United States, Brazil, Southeast Asia, South Africa, and Central America.

We are encouraged by the ongoing investment and commitment to infrastructure development throughout our rest of the world segment. In addition to the massive transmission projects that are under contract in Brazil, of which we have already booked over $150 million of orders to be delivered over the next two or three years, there have been billions of dollars of investments approved in additional power distribution and power generation projects, including hydroelectric.

In Central America, Chile, Peru, Zambia and South Africa, the need for infrastructure related projects continues to gain momentum as the respect of the companies grow, in the case of Chile, rebuild. In Thailand, our high and extra high voltage business continues to perform well despite recent political unrest. And in the Philippines, a peaceful election and change in leadership coupled with expected export earnings growth are encouraging.

In the United States, there is gradual improvement or stability occurring in many sectors of the economy, with the notable exception perhaps of residential and significant sectors of non-residential construction where data continues to be mixed and inconclusive. The decelerated pace of many leading economic indicators within the last two months has generated great deal of uncertainty as to the rate and sustainability of the recovery. Overall, demand for many of our products remains at historically variable levels with our North American factories operating at the 55% to 70% utilization levels.

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