<PAGE> 1
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1997
Commission File No. 1-12983
GENERAL CABLE CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 06-1398235
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
4 Tesseneer Drive
Highland Heights, KY 41076
(Address of principal executive offices)
(606) 572-8000
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
-- --
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at October 27, 1997
----- -------------------------------
Commmon Stock, $.01 Par Value 24,516,356
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PAGE 1
<PAGE> 2
GENERAL CABLE CORPORATION
INDEX TO QUARTERLY REPORT
ON FORM 10-Q
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION Page
----
<S> <C>
Item 1. Consolidated Financial Statements
Statements of Income -
For the three and nine months ended
September 30, 1997 and 1996 3
Balance Sheets -
September 30, 1997 and December 31, 1996 4
Statements of Cash Flows -
For the nine months ended September 30, 1997
and 1996 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURE 15
</TABLE>
2
<PAGE> 3
GENERAL CABLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(IN MILLIONS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------- -------------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales $ 306.1 $ 272.2 $ 849.3 $ 800.9
Cost of sales 244.4 216.5 683.8 661.6
------- ------- ------- -------
Gross profit 61.7 55.7 165.5 139.3
Selling, general and
administrative expenses 29.6 28.1 89.6 82.6
------- ------- ------- -------
Operating income 32.1 27.6 75.9 56.7
------- ------- ------- -------
Interest income (expense):
Interest expense (4.4) (5.0) (14.2) (15.7)
Interest income .3 .3 .6 .6
------- ------- ------- -------
(4.1) (4.7) (13.6) (15.1)
------- ------- ------- -------
Earnings before income taxes 28.0 22.9 62.3 41.6
Income tax provision 10.7 7.7 24.4 13.9
------- ------- ------- -------
Net income $ 17.3 $ 15.2 $ 37.9 $ 27.7
======= ======= ======= =======
Earnings per common share $ .71 $ .63 $ 1.55 $ 1.14
======= ======= ======= =======
Weighted average common shares 24.5 24.3 24.4 24.3
======= ======= ======= =======
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
3
<PAGE> 4
GENERAL CABLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN MILLIONS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
ASSETS September 30, December 31,
- ------ 1997 1996
------------- -------------
<S> <C> <C>
Current Assets: (unaudited)
Cash $ 7.5 $ 1.9
Receivables, net 186.7 135.5
Inventories 160.2 161.0
Deferred income taxes 23.2 23.7
Prepaid expenses and other 10.0 13.6
------ ------
Total current assets 387.6 335.7
Property, plant and equipment 136.0 128.8
Deferred income taxes 30.8 31.8
Other non-current assets 17.2 17.3
------ ------
Total assets $571.6 $513.6
====== ======
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Current Liabilities:
Accounts payable $ 74.6 $ 69.3
Accrued liabilities 58.8 58.8
Short-term debt -- 2.0
------ ------
Total current liabilities 133.4 130.1
Long-term debt 256.8 205.1
Other liabilities 73.5 71.0
------ ------
Total liabilities 463.7 406.2
------ ------
Shareholders' Equity:
Common stock, $0.01 par value:
Authorized shares - 75,000,000
Issued and outstanding shares - 24,516,356
and 24,250,000, respectively .2 .2
Additional paid-in capital 83.6 94.7
Retained earnings 24.1 12.5
------ ------
Total shareholders' equity 107.9 107.4
------ ------
Total liabilities and shareholders' equity $571.6 $513.6
====== ======
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
4
<PAGE> 5
GENERAL CABLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN MILLIONS)
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
-------------------------------
1997 1996
---- ----
<S> <C> <C>
Cash flows of operating activities:
Net income $ 37.9 $ 27.7
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization 10.1 9.1
Deferred income taxes 1.5 6.4
Changes in operating assets and liabilities:
Increase in receivables (51.2) (14.9)
Decrease in inventories .8 27.2
(Increase) decrease in other assets .4 (.5)
Increase (decrease) in accounts payable,
accrued and other liabilities 15.4 (15.1)
------ ------
Net cash flows of operating activities 14.9 39.9
------ ------
Cash flows of investing activities:
Proceeds from property sold 4.9 --
Capital expenditures (19.1) (17.6)
Other, net (2.1) .4
------ ------
Net cash flows of investing activities (16.3) (17.2)
------ ------
Cash flows of financing activities:
Dividends paid (42.6) --
Net borrowings of revolving credit facility 248.0 --
Repayment of related party notes payable (195.8) (8.0)
Repayment of short-term debt (2.0) --
Repayment of other long-term debt (.6) (.6)
------ ------
Net cash flows of financing activities 7.0 (8.6)
------ ------
Increase in cash 5.6 14.1
Cash - beginning of period 1.9 13.7
------ ------
Cash - end of period $ 7.5 $ 27.8
====== ======
SUPPLEMENTAL INFORMATION
- ------------------------
Income taxes paid (refunded) $ 14.1 $ (2.8)
====== ======
Interest paid $ 12.4 $ 14.6
====== ======
NONCASH ACTIVITIES
- ------------------
Issuance of Restricted Stock $ 5.6 $ --
====== ======
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
5
<PAGE> 6
GENERAL CABLE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. PUBLIC OFFERINGS
----------------
On May 20, 1997, Wassall Netherlands Cable B.V. (the "Selling Stockholder"), a
subsidiary of Wassall PLC ("Wassall") completed an initial public offering of
approximately 19,435,000 shares of General Cable common stock at a price of
$21.00 per share. This included 2,535,000 shares purchased under the U.S.
Underwriters' over-allotment option. On August 22, 1997, a secondary offering of
4,815,000 shares of common stock at a price of $31.00 per share was completed
("Secondary Offering"). These shares represented all of Wassall's remaining
holdings of General Cable common stock. General Cable did not receive any
proceeds from the sale of the shares of common stock.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
------------------------------------------
PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the
accounts of General Cable Corporation and its wholly owned subsidiaries. All
transactions and balances among the consolidated companies have been eliminated.
Certain reclassifications have been made to the prior year to conform to the
current year's presentation.
BASIS OF PRESENTATION The accompanying unaudited consolidated financial
statements of General Cable Corporation and Subsidiaries have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete annual
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Results of operations for the three and nine months ended
September 30, 1997 are not necessarily indicative of results that may be
expected for the full year. These financial statements should be read in
conjunction with the audited financial statements and notes thereto in General
Cable's registration statement on Form S-1 filed with the Securities and
Exchange Commission on August 6, 1997.
EARNINGS PER SHARE General Cable is required to implement Statement of Financial
Accounting Standard ("SFAS") No. 128, "Earnings Per Share", which was issued in
February 1997, in the fourth quarter of 1997. The effect of implementing this
new accounting standard on reported earnings per share is not expected to be
material.
NEW STANDARDS In June 1997, the Financial Accounting Standards Board issued SFAS
No. 130, "Reporting Comprehensive Income" and SFAS No. 131, "Disclosures about
Segments of an Enterprise and Related Information". General Cable will be
required to adopt these standards during 1998. Adoption of these standards will
not impact the reported results of operations or financial position of General
Cable; however, General Cable is planning to disclose additional information
related to the Electrical and Communications Groups when SFAS No. 131 is
implemented.
6
<PAGE> 7
GENERAL CABLE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
3. INVENTORIES
-----------
Inventories consisted of the following (in millions):
<TABLE>
<CAPTION>
September 30, December 31,
------------- ------------
1997 1996
<S> <C> <C>
Raw materials $ 21.3 $ 20.8
Work-in-progress 25.1 28.6
Finished goods 113.8 111.6
------ ------
Total $160.2 $161.0
====== ======
</TABLE>
At September 30, 1997 and December 31, 1996, $64.9 million and $67.8
million, respectively, of inventories were valued using the LIFO method.
Approximate replacement cost of inventories valued using the LIFO method totaled
$67.5 million at September 30, 1997 and $76.2 million at December 31, 1996. An
actual valuation of inventory under the LIFO method can be made only at the end
of each year based on the inventory levels and costs at that time. Accordingly,
interim LIFO calculations are necessarily based on management's estimates of
expected year-end inventory levels and costs. Because these are subject to many
variables beyond management's control, interim results are subject to the final
year-end LIFO inventory valuation.
4. LONG-TERM DEBT
--------------
In May, 1997, General Cable entered into a new credit facility with The
Chase Manhattan Bank as administrative agent, and a syndicate of banks. The new
credit facility consists of a five-year senior unsecured revolving credit and
competitive advance facility in an aggregate principal amount of $350.0 million.
Initial borrowings were used in part to repay the notes payable to Wassall
and subsidiaries outstanding at the time of the initial public offering.
At September 30, 1997, $248 million of revolving credit loans were
outstanding, with a weighted average annual interest rate of 6.24%.
Other long-term debt, primarily Industrial Development Revenue Bonds, of
$8.8 million had a weighted average annual interest rate of 5.7%.
7
<PAGE> 8
GENERAL CABLE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
5. SHAREHOLDERS' EQUITY
--------------------
Changes in shareholders' equity were as follows (in millions):
<TABLE>
<CAPTION>
Additional
Common Paid-In Retained
Stock Capital Earnings Total
------ ----------- -------- -------
<S> <C> <C> <C> <C>
Balance, December 31, 1996 $.2 $94.7 $12.5 $107.4
Net income -- -- 37.9 37.9
Dividend to Selling Stockholder -- (16.7) (25.9) (42.6)
Issuance of Restricted Stock -- 5.6 -- 5.6
Other -- -- (.4) (.4)
--- ----- ----- ------
Balance, September 30, 1997 $.2 $83.6 $24.1 $107.9
=== ===== ===== ======
</TABLE>
Following consummation of the initial public offering, General Cable
awarded 268,597 shares of Restricted Stock to executive officers and other key
employees. The awards of Restricted Stock were made in settlement of all
obligations under existing long-term incentive arrangements.
6. RELATED PARTY TRANSACTIONS
--------------------------
Prior to the initial public offering in May 1997, a subsidiary of Wassall
charged General Cable a fee for management services. Such fees amounted to $0.9
million for the 1997 period prior to the intial public offering and $0.5 million
and $1.4 million for the three and nine month periods ended September 30, 1996,
and are included in selling, general and administrative expenses in the
Consolidated Statements of Income.
Upon completion of the secondary offering, Wassall's equity stake in
General Cable was liquidated.
8
<PAGE> 9
GENERAL CABLE CORPORATION AND SUBSIDIARIES
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
GENERAL
General Cable is a leader in the development, design, manufacture,
marketing and distribution of copper, aluminum and optical fiber wire and cable
products for the communications and electrical markets. Communications wire and
cable transmits low voltage signals for voice, data, video and control
applications. Electrical wire and cable conducts electrical current for power
and control applications. General Cable believes that its principal competitive
strengths include its breadth of product line; brand recognition; distribution
and logistics; customer relationships, sales and service; and improved operating
efficiency.
This quarterly report contains various forward-looking statements and
information that are based on management's belief as well as assumptions and
information currently available to management. These statements are subject to
various risks and uncertainties, many of which are outside the control of
General Cable, including competition in the markets and market demand for
General Cable's products, changing raw material prices, economic conditions
affecting particular groups of General Cable's customers, the ability to achieve
increased productivity and other specific factors discussed in the Company's
Prospectus included in its registration statement on Form S-1 filed on August 6,
1997, and other Securities and Exchange Commission filings. The information
contained in this report represents management's best judgment as of the date
hereof based on information currently available. However, General Cable does not
intend to update this information to reflect developments or information
obtained after the date of this report.
General Cable's reported net sales are directly influenced by the price of
copper. The cost of copper has been subject to considerable volatility, with the
copper cathode daily selling price on the COMEX averaging $0.91 per pound during
the third quarter of 1996, $1.08 per pound for the first nine months of 1996,
$1.02 per pound for the third quarter of 1997 and $1.09 per pound for the first
nine months of 1997. However, as a result of a number of practices intended to
match copper purchases with sales, General Cable's profitability has generally
not been significantly affected by changes in copper prices. General Cable
generally passes changes in copper prices along to its customers, although there
are timing delays of varying lengths depending upon the type of product,
competitive conditions and particular customer arrangements. General Cable does
not engage in speculative metals trading or other speculative activities, nor
does it engage in activities to hedge the underlying value of its copper
inventory.
General Cable generally experiences certain seasonal trends in sales and
cash flow. Relatively significant amounts of cash are generally required during
the first and second quarters of the year to build inventories in anticipation
of higher demand during the spring and summer months, when construction activity
increases. In general, receivables related to higher sales activity during the
spring and summer months are collected during the third and fourth quarters of
the year.
9
<PAGE> 10
GENERAL CABLE CORPORATION AND SUBSIDIARIES
RESULTS OF OPERATIONS
THREE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED WITH THREE MONTHS ENDED SEPTEMBER
30, 1996
Net sales for the three months ended September 30, 1997 increased $33.9
million, or 12%, to $306.1 million from net sales of $272.2 million for the same
period in 1996. The increase reflects an increase of $11.8 million, or 11%, in
the net sales of the Communications Group and an increase of $22.1 million, or
13%, in the net sales of the Electrical Group. Such amounts reflect an $0.11
increase in the average monthly COMEX price per pound of copper in the three
months ended September 30, 1997 compared to the same period in 1996 and other
factors as discussed below.
After adjusting the net sales for the three months ended September 30, 1996
to reflect the $0.11 higher average monthly COMEX price per pound of copper in
the third quarter of 1997, net sales were $23.5 million, or 8%, higher than the
third quarter of 1996. The increase in copper-adjusted net sales reflected an 8%
increase in the copper-adjusted net sales of the Electrical Group and an 8%
increase in the copper-adjusted net sales of the Communications Group.
The increase in Communications Group net sales is primarily attributable to
substantially higher net sales volume of datacom products, partially offset by
lower selling prices of some high speed data cables in the 1997 period. The
growth in Electrical Group net sales was primarily due to increased net sales
volume of building wire and portable cord in the third quarter of 1997 compared
to the same period in 1996. Electrical Group net sales also rose substantially
in Canada. Reported net sales to General Cable's top 20 customers for the three
months ended September 30, 1997 increased 27% from the same period in 1996.
Gross profit increased $6.0 million, or 11%, to $61.7 million in the third
quarter of 1997 from $55.7 million in the third quarter of 1996. General Cable's
gross profit percentage was 20.2% in the third quarter of 1997 compared to 20.5%
in the third quarter of 1996. On a copper-adjusted basis (to the third quarter
of 1997), General Cable's gross profit percentage was 19.7% in the third quarter
of 1996. The improvement in 1997 was primarily attributable to manufacturing
cost reductions combined with continuing favorable building wire pricing,
partially offset by a decrease in pricing for some high speed data cables and
the unfavorable impact of temporarily purchasing PIC product from third parties
at a cost in excess of General Cable's manufacturing cost to satisfy PIC demand
in excess of present capacity. General Cable is currently adding manufacturing
capacity which will eliminate the adverse effect of outsourcing PIC products.
The reduction in manufacturing costs in the third quarter of 1997 compared
to the same period in 1996 primarily reflected process improvements to reduce
material costs, improved material usage, and capital investment to improve
productivity and throughput.
10
<PAGE> 11
GENERAL CABLE CORPORATION AND SUBSIDIARIES
Selling, general and administrative expenses increased $1.5 million, or 5%,
to $29.6 million in the third quarter of 1997 from $28.1 million in the third
quarter of 1996. The increase primarily reflected higher transportation costs,
increased advertising and increased salaries for additional staffing to support
sales growth. Also included in selling, general and administrative expenses in
the third quarter of 1997 was $0.4 million (.1% of sales) for expenses related
to the Secondary Offering. Selling, general and administrative expenses as a
percentage of sales were 9.7% in the third quarter of 1997, compared to 10.3% in
the third quarter of 1996.
Net interest expense was $4.1 million in the third quarter of 1997 compared
to $4.7 million in the third quarter of 1996. The reduction reflects the impact
of refinancing related party debt in May 1997 with borrowing under a new credit
facility at a lower effective interest rate.
The effective income tax rate for the third quarter of 1997 was 38%
compared to approximately 34% for the third quarter of 1996. The lower 1996
effective tax rate reflected the impact of certain tax return reconciliation
adjustments.
NINE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED WITH NINE MONTHS ENDED SEPTEMBER
30, 1996
Net sales for the nine months ended September 30, 1997 increased $48.4
million, or 6%, to $849.3 million from net sales of $800.9 million for the same
period in 1996. The increase reflects an increase of $37.7 million, or 7%, in
the net sales of the Electrical Group and an increase of $10.7 million, or 4%,
in the net sales of the Communications Group. Such amounts reflect a $0.01
increase in the average monthly COMEX price per pound of copper in the first
nine months of 1997 compared to the first nine months of 1996 and other factors
as discussed in the following paragraph.
After adjusting the net sales for the first nine months of 1996 to reflect
the $0.01 higher average monthly COMEX price per pound of copper in the first
nine months of 1997, net sales were $45.7 million, or 6%, higher than the first
nine months of 1996. The increase in copper-adjusted net sales reflects a 7%
increase in the copper-adjusted net sales of the Electrical Group and a 3%
increase in the copper-adjusted net sales of the Communications Group. The
growth in Electrical Group net sales was primarily due to more favorable
building wire pricing and increased sales volume of building wire, portable cord
and OEM cordsets products in the first nine months of 1997 compared to the same
period in 1996. The increase in Communications Group net sales reflected an
increase in Datacom product sales volume, partially offset by a decline in the
volume of sales of PIC to US West and a decrease in pricing for high speed data
cables.
Gross profit increased $26.2 million, or 19%, to $165.5 million in the
first nine months of 1997 from $139.3 million in the first nine months of 1996.
General Cable's gross profit percentage increased to 19.5% in the first nine
months of 1997 from 17.4% in the first nine months of 1996. The improvement in
the 1997 period was primarily attributable to improved building wire pricing and
manufacturing cost reductions, partially offset by a decrease in pricing for
high speed data cables.
11
<PAGE> 12
GENERAL CABLE CORPORATION AND SUBSIDIARIES
The reduction in manufacturing costs in the first nine months of 1997
compared to the same period in 1996 reflected (i) the carryover effects of
production facilities rationalized; (ii) improvement in capacity utilization,
including the conversion of certain facilities from five day to seven day per
week continuous production schedules; (iii) product redesigns to lower material
costs; and (iv) capital investment and other improvements in manufacturing
processes to improve materials usage and reduce waste.
Selling, general and administrative expenses increased $7.0 million, or
8.5%, to $89.6 million in the first nine months of 1997 from $82.6 million in
the first nine months of 1996. The increase primarily reflected higher
transportation costs, higher advertising and increased salaries for additional
staffing to support sales growth. Selling, general and administrative expenses
as a percentage of sales were 10.5% in the first nine months of 1997, compared
to 10.3% in the first nine months of 1996.
Net interest expense was $13.6 million in the first nine months of 1997
compared to $15.1 million in the first nine months of 1996. The reduction
reflects the repayment of an $8.0 million related party note during 1996 and the
impact of refinancing the remaining related party debt in May, 1997 with
borrowing under a new credit facility at a lower effective interest rate.
The effective income tax rate for the nine months ended September 30, 1997
was 39% compared to 33% for the nine months ended September 30, 1996. The lower
1996 effective tax rate reflected the impact of certain tax return
reconciliation adjustments.
PRO FORMA RESULTS
The following pro forma results give effect to the refinancing of related
party debt as if it had occurred as of the beginning of the periods presented.
The pro forma financial data are for informational purposes only and may not
necessarily be indicative of the results of operations had the refinancing
actually occurred on such date.
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Pro forma net income $ 17.3 $ 16.0 $ 39.2 $ 30.2
====== ====== ====== ======
Pro forma earnings per share $ .71 $ .66 $ 1.61 $ 1.24
====== ====== ====== ======
</TABLE>
LIQUIDITY AND CAPITAL RESOURCES
In general, General Cable requires cash for working capital, capital
expenditures, debt repayment, interest and taxes. General Cable's working
capital requirements increase when it experiences strong incremental demand for
products and/or significant copper price increases.
12
<PAGE> 13
GENERAL CABLE CORPORATION AND SUBSIDIARIES
Cash flow provided by operating activities in the first nine months of 1997
was $14.9 million. This principally reflected net income before depreciation and
deferred taxes of $49.5 million, a $0.8 million decrease in inventories and a
$15.4 million increase in accounts payable, accrued liabilities and other
long-term liabilities, partially offset by a $51.2 million increase in accounts
receivable.
Cash flow used in investing activities was $16.3 million in the first nine
months of 1997, principally reflecting $19.1 million of capital expenditures.
Also included in cash flow from investing activities was $4.6 million from the
sale of excess real property in 1997.
Cash flow provided by financing activities in the first nine months of 1997
was $7.0 million, primarily reflecting proceeds of borrowings under General
Cable's revolving credit line in excess of the repayment of intercompany and
other debt and the payment of a dividend. The intitial borrowing of $268.0
million in May 1997 has been reduced to $248.0 million at September 30, 1997.
In May 1997, on consummation of the initial public offering, General Cable
borrowed $268.0 million under a new $350.0 million credit facility entered into
with a syndicate of banks (the "New Credit Facility"). The Company used the
proceeds of such borrowing to (i) repay all of its revolving bank debt, (ii)
repay all intercompany debt and advances owed to Wassall and its subsidiaries;
(iii) pay $42.6 million as a dividend to the Selling Stockholder; (iv) pay $2.0
million for the purchase of two related companies, Carol Cable Europe Ltd. and
Carol Cable Ltd., from Wassall; and (v) pay expenses of the Refinancing of $0.4
million.
The New Credit Facility consists of a five-year senior unsecured revolving
credit and competitive advance facility in an aggregate principal amount of
$350.0 million. Borrowings are guaranteed by General Cable's principal operating
subsidiaries. Borrowings under the New Credit Facility were $248.0 million at
September 30, 1997.
Revolving Credit loans bear interest, at General Cable's option, at (i) a
spread over LIBOR or (ii) the Alternate Base Rate, which is defined as the
higher of (a) the Agent's Prime Rate, (b) the secondary market rate for
certificates of deposit (adjusted for reserve requirements) plus 1% or (c) the
Federal Funds Effective Rate.
A facility fee accrues on the full amount of the New Credit Facility,
regardless of usage. The facility fee ranges between 8.0 and 20.0 basis points
per annum, depending upon General Cable's Leverage Ratio.
The New Credit Facility requires that General Cable meet certain financial
ratio requirements and it also limits (i) mergers, consolidations and certain
asset sales and dispositions; (ii) subsidiary indebtedness and guarantees; (iii)
liens and sale-leaseback transactions; (iv) transactions with affiliates; (v)
dividends on, and redemptions and repurchases of, capital stock; (vi) dividends
and advances by subsidiaries; (vii) loans and investments; (viii) issuance of
capital stock by subsidiaries; (ix) hedging activities other than in the
ordinary course of business; and (x) changes in business.
13
<PAGE> 14
GENERAL CABLE CORPORATION AND SUBSIDIARIES
PART II - OTHER INFORMATION
---------------------------
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
11 - Computation of Earnings Per Share
27 - Financial Data Schedule
(b) Reports on Form 8-K - None
14
<PAGE> 15
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, General
Cable Corporation has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
GENERAL CABLE CORPORATION
Signed: November 3, 1997 By: s/CHRISTOPHER F. VIRGULAK
--------------------------
Christopher F. Virgulak
Executive Vice President, Chief
Financial Officer and Treasurer
15
<PAGE> 1
EXHIBIT 11
GENERAL CABLE CORPORATION AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON SHARE
(IN MILLIONS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------- ---------------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net earnings used to calculate earnings
per share: $ 17.3 $ 15.2 $ 37.9 27.7
====== ====== ====== ======
Calculation of primary earnings per share:
Weighted average common shares 24.5 24.3 24.4 24.3
Dilutive effect of assumed exercise of options
for the purchase of common shares 0.4 -- 0.2 --
------ ------ ------ ------
Weighted average common shares used to
calculate primary earnings per share 24.9 24.3 24.6 24.3
====== ====== ====== ======
Primary earnings per common share $ 0.69 $ 0.63 $ 1.54 $ 1.14
====== ====== ====== ======
Calculation of fully diluted earnings per share:
Weighted average common shares 24.5 24.3 24.4 24.3
Dilutive effect of assumed exercise of
options for the purchase of common shares 0.5 -- 0.2 --
------ ------ ------ ------
Weighted average common shares used to
calculate fully diluted earnings per share 25.0 24.3 24.6 24.3
====== ====== ====== ======
Fully diluted earnings per common share $ 0.69 $ 0.63 $ 1.54 $ 1.14
====== ====== ====== ======
</TABLE>
16
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS INFORMATION CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q
FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 1997 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FORM 10-Q.
</LEGEND>
<CIK> 0000886035
<NAME> GENERAL CABLE CORPORATION
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 7,500
<SECURITIES> 0
<RECEIVABLES> 186,700
<ALLOWANCES> 10,000
<INVENTORY> 160,200
<CURRENT-ASSETS> 387,600
<PP&E> 136,000
<DEPRECIATION> 37,900
<TOTAL-ASSETS> 571,600
<CURRENT-LIABILITIES> 133,400
<BONDS> 0
0
0
<COMMON> 200
<OTHER-SE> 107,700
<TOTAL-LIABILITY-AND-EQUITY> 571,600
<SALES> 849,300
<TOTAL-REVENUES> 849,300
<CGS> 683,800
<TOTAL-COSTS> 773,400
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 14,200
<INCOME-PRETAX> 62,300
<INCOME-TAX> 24,400
<INCOME-CONTINUING> 37,900
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 37,900
<EPS-PRIMARY> 1.55
<EPS-DILUTED> 1.54
</TABLE>
