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General Cable Reports Third Quarter Results; Adjusted EPS Of $0.60 Within Management’s Range Of Expectations; Operating Income Of $75.4 Million Exceeded Management’s Range Of Expectations; Announces Agreement To Acquire Prestolite Wire, LLC

Brian Moriarty, Vice President of North American Sales, said, “The Prestolite acquisition is a key enabler towards General Cable growing its presence with existing customers, providing greater opportunities to offer existing products to new markets, and strengthening its market strategies for both new and existing specialty industrial OEM and distribution customers. This acquisition solidifies General Cable’s position in North America as the wire and cable manufacturer that possesses the broadest product offering serving virtually every segment of the wire and cable industry.”

Fourth Quarter 2012 Outlook and Updated View Full Year 2012 Including the acquisitions of Alcan Cable North America and Procables (Colombia)

The Company’s fourth quarter revenues are expected to be in the range of $1.62 to $1.67 billion assuming average metal prices for the 29-day period ending October 29 on 15-18% unit volume improvement sequentially. Excluding acquisitions volume is expected to be flat to slightly lower sequentially. The Company expects adjusted operating income to be in the range of $55 to $65 million. Adjusted earnings per share are expected to be in the range of $0.40 to $0.50 per share before the impact of non-cash convertible debt interest expense and mark to market gains or losses on derivative instruments. Also, excluded from the fourth quarter outlook is the impact of the pre-tax $9.4 million call premium and write-off of related historical bank fees in connection with the call of the $200 million of 7.125% senior fixed rate notes due in 2017 on October 12 th. The fourth quarter outlook reflects normal seasonal trends in North America and ROW, ongoing recessionary conditions in Iberia but also Europe generally, scheduling changes in the Company’s submarine and land based turnkey project businesses, planned global seasonal inventory reductions and incremental net interest expense of $8.5 million or $0.12 per share principally due to the recent debt issuance and higher incremental local borrowings. These trends are expected to be partially offset by construction activities in Central and South America and the ongoing rebuilding efforts in Thailand. In addition, the acquisition of Alcan Cable North America is expected to contribute meaningfully in the fourth quarter as step-up purchasing accounting adjustments principally affected the third quarter. U.S. demand for cables used in industrial and data communications applications is weakening beyond typical seasonality and wind applications have slowed considerably as tax incentives are set to expire at the end of the year. Housing, however, is positive and should help support demand for utility and construction related cables.

The Company has revised its expectations for adjusted operating income to $260 to $270 million for the full year 2012. In addition, the Company expected unit volume for 2012 of 1,100 to 1,130 million pounds including the impact of acquisitions. Excluding acquisitions, unit volume is expected to be 1,025 to 1,045 million pounds in 2012. “Unfortunately, the challenging operating environment we described last quarter has grown even more difficult in some markets and product lines. The economic uncertainty in Europe and to some extent, China along with a weakening industrial environment in the US continues to limit our visibility. We are however encouraged by the recent positive trends in the US housing data and the relative strength of the emerging markets. We remain focused on daily execution, working capital management, and continuous improvement. We are also focused on the integration of Alcan Cable North America and Procables (Colombia) and the closing of Alcan Cable China and Prestolite, all of which together have the potential of generating incremental revenue in 2013 in the range of $750 million at current metal prices. We are off to a fast start executing on our integration plans and are making excellent progress in identifying and realizing manufacturing, logistics, and purchasing synergies. We are equally encouraged, as the sharing of best practices has generated a number of other opportunities in the areas of inventory management and safety, among others. We anticipate closing on Alcan Cable China and Prestolite before the end of the year. We expect these acquisitions to contribute to earnings meaningfully on a full year basis,” Kenny concluded. A reconciliation of expected GAAP earnings per share and operating income is as follows:

        Q4 2012 Outlook
In millions, except per share amounts

OperatingIncome

      EPS
As reported, GAAP $55 – 65       $0.16-$0.26
Non-cash convertible debt interest expense - 0.11
Mark to market (gains)/losses on derivative instruments - -
Call premium for $200 million of 7.125% senior fixed rate notes and related fee write-off -       0.13
Adjusted, Non-GAAP $55 – 65       $0.40-$0.50
 

Reconciliation of Non-GAAP Measures

In addition to reporting financial results in accordance with accounting principles generally accepted in the United States (GAAP), we discuss earnings per share for the third quarter of 2012 as adjusted for the impact of non-cash convertible debt interest expense and mark to market gains and losses on financial derivatives accounted for as economic hedges. These Company-defined adjusted measures are being provided because management believes they are useful in analyzing the operating performance of the business. These non-GAAP measures may be inconsistent with similar measures presented by other companies and should only be used in conjunction with our results reported according to GAAP. A reconciliation of operating income and earnings per share as reported to adjusted non-GAAP operating income and earnings per share follows:

        Q3 2012

OperatingIncome

      EPS
As Reported, GAAP $ 75.4       $ 0.62
Non-cash convertible debt interest expense - 0.11
Mark to market (gains)/losses on derivative instruments -       (0.13)
Adjusted, Non-GAAP $ 75.4       $ 0.60
 

General Cable will discuss third quarter results on a conference call that will be broadcast live at 8:30 a.m. ET, on October 30, 2012. The live webcast of the Company’s conference call will be available in listen only mode and can be accessed through the Investor Relations page on our website at www.generalcable.com. Also available on our website is a copy of an Investor Presentation that will be referenced throughout the conference call.

General Cable Corporation (NYSE:BGC), a Fortune 500 Company, is a global leader in the development, design, manufacture, marketing and distribution of copper, aluminum and fiber optic wire and cable products and systems for the energy, industrial, specialty, construction and communications markets. Visit our website at www.generalcable.com.

Cautionary Statement Regarding Forward-Looking Statements

Certain statements in this press release are forward-looking statements that involve risks and uncertainties, predict or describe future events or trends and that do not relate solely to historical matters. Forward looking statements can generally be identified by use of forward-looking terminology such as “believe,” “expect,” “may,” “will,” “anticipate,” “intend,” “estimate,” “project,” “plan,” “assume,” “seek to” or other similar expressions, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those discussed in forward-looking statements as a result of factors, risks and uncertainties over many of which we have no control. These factors include, but are not limited to: the economic strength and competitive nature of the geographic markets that the Company serves; our ability to increase manufacturing capacity and productivity; our ability to increase our selling prices during periods of increasing raw material costs; our ability to service, and meet all requirements under, our debt, and to maintain adequate domestic and international credit facilities and credit lines; the impact of unexpected future judgments or settlements of claims and litigation; the impact of foreign currency fluctuations, compliance with U.S. and foreign laws, the Company’s ability to implement and make appropriate, timely and beneficial decisions as to when, how and if to purchase shares under the repurchase program and the other risks detailed from time to time in the Company’s SEC filings, including but not limited to, its annual report on Form 10-K for the fiscal year ending December 31, 2011, and subsequent SEC filings. You are cautioned not to place undue reliance on these forward-looking statements. General Cable does not undertake, and hereby disclaims, any obligation, unless required to do so by applicable securities laws, to update any forward-looking statements as a result of new information, future events or other factors.

TABLES TO FOLLOW

General Cable Corporation and Subsidiaries
Consolidated Statements of Operations
(in millions, except per share data)
(unaudited)
 
 
Three Fiscal

Months Ended

September 28,
2012
 
Net sales $ 1,503.3
Cost of sales   1,334.4  
Gross profit 168.9
 

Selling, general and administrative expenses

  93.5  
Operating income 75.4
Other income (expense) 9.7
Interest income (expense):
Interest expense (24.9 )
Interest income   1.3  
  (23.6 )
 
Income before income taxes 61.5
Income tax provision (28.2 )
Equity in net earnings of affiliated companies   0.5  
Net income including noncontrolling interests 33.8
Less: preferred stock dividends 0.1
Less: net income attributable to noncontrolling interest   2.3  
Net income attributable to Company common shareholders $ 31.4  
EPS
Earnings per common share - basic $ 0.63  
Weighted average common shares - basic   49.7  
Earnings per common share-
assuming dilution $ 0.62  
Weighted average common shares-
assuming dilution   51.1  
 

General Cable Corporation and Subsidiaries
Consolidated Statements of Operations
Segment Information
(in millions)
(unaudited)
   

Three Fiscal

Months Ended

September 28,
2012
 
Revenues (as reported)
North America $ 563.6
Europe and Mediterranean 420.2
Rest of World   519.5
Total $ 1,503.3
 
Metal Pounds Sold
North America 106.2
Europe and Mediterranean 64.7
Rest of World   106.6
Total   277.5
 
Operating Income
North America $ 26.8
Europe and Mediterranean 11.8
Rest of World   36.8
Total $ 75.4
 
Return on Revenue
North America 4.8%
Europe and Mediterranean 2.8%
Rest of World 7.1%
Total Company 5.0%
 
Capital Expenditures
North America $ 6.3
Europe and Mediterranean 10.3
Rest of World   9.5
Total $ 26.1
 
Depreciation & Amortization
North America $ 8.5
Europe and Mediterranean 9.1
Rest of World   10.6
Total $ 28.2
 
Revenues by Major Product Lines
Electric Utility $ 499.1
Electrical Infrastructure 377.4
Construction 384.1
Communications 163.2
Rod Mill Products   79.5
Total $ 1,503.3
 




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