UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 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		41076-9753
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (859) 572-8000

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 þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer, “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer þ		Accelerated filer o		Non-accelerated filer o		Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

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 April 29, 2011
Common Stock, $0.01 per value			52,165,741

 

 

GENERAL CABLE CORPORATION AND SUBSIDIARIES
INDEX TO QUARTERLY REPORT
ON FORM 10-Q

		PAGE
PART I Financial Statements
Item 1. Condensed Consolidated Financial Statements (Unaudited)
Statements of Operations - For the three fiscal months ended April 1, 2011 and April 2, 2010			3
Balance Sheets - April 1, 2011 and December 31, 2010			4
Statements of Cash Flows - For the three fiscal months ended April 1, 2011 and April 2, 2010			5
Notes to Condensed Consolidated Financial Statements			6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			31
Item 3. Quantitative and Qualitative Disclosures about Market Risk			41
Item 4. Controls and Procedures			42
PART II Other Information
Item 1. Legal Proceedings			42
Item 1A. Risk Factors			42
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			43
Item 6. Exhibits			43
Signature			44
Exhibit Index			45
Exhibit 12.1
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT

PART I. FINANCIAL STATEMENTS

ITEM 1.		CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

GENERAL CABLE CORPORATION AND SUBSIDIARIES

(unaudited)

		Three Fiscal Months Ended
		April 1,				April 2,
		2011				2010
Net sales		$	1,447.6			$	1,098.0
Cost of sales			1,280.6				960.4
Gross profit			167.0				137.6
Selling, general and administrative expenses			93.9				80.3
Operating income (loss)			73.1				57.3
Other income (expense)			7.0				(36.5	)
Interest income (expense):
Interest expense			(24.0	)			(19.0	)
Interest income			2.0				1.1
			(22.0	)			(17.9	)
Income (loss) before income taxes			58.1				2.9
Income tax (provision) benefit			(19.4	)			(8.3	)
Equity in earnings (loss) of affiliated companies			0.4				0.3
Net earnings (loss) including noncontrolling interest			39.1				(5.1	)
Less: preferred stock dividends			0.1				0.1
Less: net income (loss) attributable to noncontrolling interest			0.8				2.6
Net income (loss) attributable to Company common shareholders		$	38.2			$	(7.8	)
Earnings (loss) per share
Earnings (loss) per common share — basic		$	0.73			$	(0.15	)
Weighted average common shares — basic			52.1				52.0
Earnings (loss) per common share — assuming dilution		$	0.70			$	(0.15	)
Weighted average common shares — assuming dilution			54.5				52.0

See accompanying Notes to Condensed Consolidated Financial Statements.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

(unaudited)

		April 1,				December 31,
		2011				2010
Assets
Current Assets:
Cash and cash equivalents		$	415.2			$	458.7
Receivables, net of allowances of $24.4 million at April 1, 2011 and $21.1 million at December 31, 2010			1,198.8				1,067.0
Inventories, net			1,324.3				1,118.9
Deferred income taxes			47.7				39.8
Prepaid expenses and other			130.5				121.3
Total current assets			3,116.5				2,805.7
Property, plant and equipment, net			1,069.7				1,039.6
Deferred income taxes			15.8				11.3
Goodwill			173.5				174.9
Intangible assets, net			196.1				199.6
Unconsolidated affiliated companies			17.9				17.3
Other non-current assets			76.5				79.3
Total assets		$	4,666.0			$	4,327.7
Liabilities and Total Equity
Current Liabilities:
Accounts payable		$	1,049.7			$	922.5
Accrued liabilities			398.4				376.7
Current portion of long-term debt			181.8				121.0
Total current liabilities			1,629.9				1,420.2
Long-term debt			913.2				864.5
Deferred income taxes			209.9				202.4
Other liabilities			238.4				235.3
Total liabilities			2,991.4				2,722.4
Commitments and Contingencies
Total Equity:
Redeemable convertible preferred stock, at redemption value (liquidation preference of $50.00 per share): April 1, 2011 — 76,202 shares outstanding December 31, 2010 — 76,202 shares outstanding			3.8				3.8
Common stock, $0.01 par value, issued and outstanding shares: April 1, 2011 — 52,165,947 (net of 6,216,259 treasury shares) December 31, 2010 — 52,116,390 (net of 6,211,854 treasury shares)			0.6				0.6
Additional paid-in capital			656.5				652.8
Treasury stock			(74.7	)			(74.0	)
Retained earnings			913.5				875.3
Accumulated other comprehensive income (loss)			52.7				23.5
Total Company shareholders’ equity			1,552.4				1,482.0
Noncontrolling interest			122.2				123.3
Total equity			1,674.6				1,605.3
Total liabilities and equity		$	4,666.0			$	4,327.7

See accompanying Notes to Condensed Consolidated Financial Statements.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

(unaudited)

		Three Fiscal Months Ended
		April 1,				April 2,
		2011				2010
Cash flows of operating activities:
Net income (loss) including noncontrolling interest		$	39.1			$	(5.1	)
Adjustments to reconcile net income (loss) to net cash flows of operating activities:
Depreciation and amortization			27.7				25.3
Amortization on restricted stock awards			1.0				1.0
Foreign currency exchange (gain) loss			0.2				36.5
Deferred income taxes			(6.4	)			(5.6	)
Excess tax (benefits) deficiencies from stock-based compensation			(0.7	)			—
Convertible debt instruments noncash interest charges			5.1				4.7
(Gain) loss on disposal of property			0.1				(0.1	)
Changes in operating assets and liabilities, net of effect of acquisitions and divestitures:
(Increase) decrease in receivables			(100.6	)			7.1
(Increase) decrease in inventories			(176.8	)			(113.7	)
(Increase) decrease in other assets			(7.3	)			(6.1	)
Increase (decrease) in accounts payable, accrued and other liabilities			113.0				37.9
Net cash flows of operating activities			(105.6	)			(18.1	)
Cash flows of investing activities:
Capital expenditures			(26.6	)			(19.7	)
Proceeds from properties sold			0.3				2.9
Acquisitions, net of cash acquired			—				(8.2	)
Other			0.5				(1.1	)
Net cash flows of investing activities			(25.8	)			(26.1	)
Cash flows of financing activities:
Preferred stock dividends paid			(0.1	)			(0.1	)
Excess tax benefits (deficiencies) from stock-based compensation			0.7				—
Proceeds from revolving credit borrowings			180.4				—
Repayments of revolving credit borrowings			(131.7	)			—
Proceeds (repayments) of other debt			48.5				11.6
Proceeds from exercise of stock options			0.7				—
Net cash flows of financing activities			98.5				11.5
Effect of exchange rate changes on cash and cash equivalents			(10.6	)			(40.4	)
Increase (decrease) in cash and cash equivalents			(43.5	)			(73.1	)
Cash and cash equivalents — beginning of period			458.7				499.4
Cash and cash equivalents — end of period		$	415.2			$	426.3
Supplemental Information
Cash paid during the period for:
Income tax payments, net of refunds		$	6.1			$	3.3
Interest paid		$	13.2			$	10.9

See accompanying Notes to Condensed Consolidated Financial Statements.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited)

1. Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements of General Cable Corporation and Subsidiaries (“General Cable” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) 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 GAAP for complete 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 fiscal months ended April 1, 2011 are not necessarily indicative of results that may be expected for the full year. The December 31, 2010 condensed consolidated balance sheet amounts are derived from the audited financial statements. These financial statements should be read in conjunction with the audited financial statements and notes thereto in General Cable’s 2010 Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 25, 2011. The Company’s fiscal quarters consist of 13-week periods ending on the Friday nearest to the end of the calendar months of March, June and September.

The condensed consolidated financial statements include the accounts of General Cable Corporation and its wholly-owned subsidiaries. Investments in 50% or less owned joint ventures in which the Company has the ability to exercise significant influence are accounted for under the equity method of accounting. All intercompany transactions and balances among the consolidated companies have been eliminated.

2. Accounting Standards

The Company’s significant accounting policies are described in Note 2 to the audited annual consolidated financial statements. In the three months ended April 1, 2011, there have been no significant changes to these policies. In the three months ended April 1, 2011 there have been no recent accounting pronouncements that are expected to have a significant effect on the consolidated financial statements.

3. Acquisitions and Divestitures

General Cable actively seeks to identify key global macroeconomic and geopolitical trends in order to capitalize on expanding markets and new niche markets or exit declining or non-strategic markets in order to achieve better returns. The Company also sets aggressive performance targets for its business and intends to refocus or divest those activities which fail to meet targets or do not fit long-term strategies. The Company did not enter into any acquisitions in the three months ended April 1, 2011.

4. Other income (expense)

Other income (expense) includes foreign currency transaction gains or losses, which result from changes in exchange rates between the designated functional currency and the currency in which a transaction is denominated as well as unrealized gains and losses on derivative instruments that are not designated as cash flow hedges. During the three months ended April 1, 2011 and April 2, 2010, the Company recorded a $7.0 million gain and a $36.5 million loss, respectively. For the three months ended April 1, 2011, other income of $7.0 million was primarily the result of $6.0 million related to unrealized gains on derivative instruments which were not designated as cash flow hedges and other income of $1.5 million related to foreign currency transactions. For the three months ended April 2, 2010, other expense of $36.5 million was attributable to the $29.8 million Venezuelan currency devaluation related to the remeasurement of the local balance sheet on the date of the devaluation at the official non-essential rate and other expense of $6.7 million resulting primarily from foreign currency transaction gains and losses.

The functional currency of the Company’s subsidiary in Venezuela is the U.S. dollar; therefore, gains and losses for transactions at a rate other than the official exchange rate for non-essential goods are recorded in the statement of operations. For the first quarter of 2010, purchases of dollars to import copper and other raw materials were completed at a parallel rate of about 6.52 BsF per U.S. dollar. Before it was deemed an illegal exchange mechanism in June 2010, the Company recorded $7.6 million in foreign exchange losses related to copper and other raw material imports at this parallel rate in the first quarter of 2010. See Item 2, “Venezuelan Operations” for additional details.

In the second quarter of 2010, the Company received authorization to purchase dollars to import copper at the official exchange rate for essential goods of 2.60 BsF per U.S. dollar. On December 30, 2010, the Central Bank of Venezuela and the Ministry of Finance published an amendment to Convenio Cambiario No. 14 (the Exchange Law), whereby the official exchange rate was set at 4.30 BsF per U.S. dollar effective January 1, 2011 thereby eliminating the 2.60 BsF per U.S. dollar rate previously established for essential goods in the first quarter of 2010. No foreign currency transactions gains were recorded in Venezuela in the three months ended April 1, 2011 and April 2, 2010 as a result of using this favorable rate to purchase copper.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

5. Inventories

Approximately 82% of the Company’s inventories are valued using the average cost method and all remaining inventories are valued using the first-in, first-out (FIFO) method. All inventories are stated at the lower of cost or market value.

		April 1,				December 31,
(in millions)		2011				2010
Raw materials		$	235.2			$	206.9
Work in process			254.4				215.5
Finished goods			834.7				696.5
Total		$	1,324.3			$	1,118.9

6. Property, Plant and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation. Costs assigned to property, plant and equipment relating to acquisitions are based on estimated fair values at the acquisition date. Depreciation is recorded using the straight-line method over the estimated useful lives of the assets: new buildings, from 15 to 50 years; and machinery, equipment and office furnishings, from 2 to 15 years. Leasehold improvements are depreciated over the shorter of the lease term or the useful life of the asset, unless acquired in a business combination, in which case the leasehold improvements are amortized over the shorter of the useful life of the asset or a term that includes the reasonably assured life of the lease.

Property, plant and equipment consisted of the following (in millions):

		April 1,				December 31,
		2011				2010
Land		$	114.6			$	112.0
Buildings and leasehold improvements			320.5				309.7
Machinery, equipment and office furnishings			1,080.5				1,028.6
Construction in progress			81.7				73.5
Total — gross book value			1,597.3				1,523.8
Less accumulated depreciation			(527.6	)			(484.2	)
Total — net book value		$	1,069.7			$	1,039.6

Depreciation expense for the three fiscal months ended April 1, 2011 and April 2, 2010 was $24.0 million and $21.1 million, respectively.

The Company periodically evaluates the recoverability of the carrying amount of long-lived assets (including property, plant and equipment and intangible assets with determinable lives) whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. The Company evaluates events or changes in circumstances based mostly on actual historical operating results, but business plans, forecasts, general and industry trends, and anticipated cash flows are also considered. Impairment is assessed when the undiscounted expected future cash flows derived from an asset are less than its carrying amount. Impairment losses are measured as the amount by which the carrying value of an asset exceeds its fair value and are recognized in earnings. The Company also continually evaluates the estimated useful lives of all long-lived assets and, when warranted, revises such estimates based on current events. No material impairment charges occurred during the three fiscal months ended April 1, 2011 and April 2, 2010.

7. Goodwill and Other Intangible Assets

Goodwill and intangible assets with indefinite useful lives are not amortized, but are reviewed at least annually for impairment. If the carrying amount of goodwill or an intangible asset with an indefinite life exceeds its fair value, an impairment loss would be recognized in the amount equal to the excess. Intangible assets that are not deemed to have indefinite lives are amortized over their useful lives.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

The amounts of goodwill and indefinite-lived intangible assets were as follows in millions of dollars:

		Goodwill																Indefinite-lived assets - Trade names
		North				Europe and												North				Europe and
		America				Mediterranean				ROW				Total				America				Mediterranean				ROW				Total
Balance at December 31, 2010		$	2.3			$	6.8			$	165.8			$	174.9			$	2.4			$	0.5			$	136.0			$	138.9
Acquisitions			—				—				—				—				—				—				—				—
Currency translation and other adjustments			—				(1.4	)			—				(1.4	)			—				—				(0.1	)			(0.1	)
Balance at April 1, 2011		$	2.3			$	5.4			$	165.8			$	173.5			$	2.4			$	0.5			$	135.9			$	138.8

The amounts of other intangible assets — customer relationships were as follows in millions of dollars:

		April 1,				December 31,
		2011				2010
Amortized intangible assets:
Customer relationships		$	107.0			$	107.0
Accumulated amortization			(52.7	)			(49.4	)
Foreign currency translation adjustment			3.0				3.1
Amortized intangible assets, net		$	57.3			$	60.7

Amortized intangible assets are stated at cost less accumulated amortization as of April 1, 2011 and December 31, 2010. Customer relationships have been determined to have a useful life in the range of 3.5 to 10 years and the Company has accelerated the amortization expense to align with the historical customer attrition rates. The amortization of intangible assets for the first three fiscal months of 2011 and 2010 was $3.3 million and $3.6 million, respectively. The estimated amortization expense during the twelve month periods beginning April 1, 2011 through March 31, 2016, based on exchange rates as of April 1, 2011, are $11.2 million, $10.2 million, $9.4 million, $8.6 million, $7.7 million and $10.2 million thereafter.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

8. Long-Term Debt

		April 1,				December 31,
(in millions)		2011				2010
North America
Subordinated Convertible Notes due 2029		$	429.5			$	429.5
Debt discount on Subordinated Convertible Notes due 2029			(265.3	)			(265.6	)
1.00% Senior Convertible Notes due 2012			10.6				10.6
Debt discount on 1.00% Senior Convertible Notes due 2012			(0.9	)			(1.1	)
0.875% Convertible Notes due 2013			355.0				355.0
Debt discount on 0.875% Convertible Notes due 2013			(54.9	)			(59.5	)
7.125% Senior Notes due 2017			200.0				200.0
Senior Floating Rate Notes			125.0				125.0
Amended Credit Facility			48.7				—
Other			9.0				9.0
Europe and Mediterranean
Spanish Term Loan			46.8				50.1
Credit facilities			26.4				38.1
Uncommitted accounts receivable facilities			—				—
Other			14.3				15.3
ROW
Credit facilities			150.8				79.1
Total debt			1,095.0				985.5
Less current maturities			181.8				121.0
Long-term debt		$	913.2			$	864.5

At April 1, 2011, maturities of long-term debt during twelve month periods beginning April 1, 2011 through March 31, 2016 are $181.8 million, $85.0 million, $314.4 million, $11.7 million and $127.1 million, respectively, and $375.0 million thereafter. As of April 1, 2011 and December 31, 2010, the Company was in compliance with all debt covenants as discussed below.

The Company’s convertible debt instruments outstanding as of April 1, 2011 and December 31, 2010 are as follows:

		Subordinated Convertible Notes								1.00% Senior Convertible Notes								0.875% Convertible Notes
		April 1,				December 31,				April 1,				December 31,				April 1,				December 31,
(in millions)		2011				2010				2011				2010				2011				2010
Face value		$	429.5			$	429.5			$	10.6			$	10.6			$	355.0			$	355.0
Debt discount			(265.3	)			(265.6	)			(0.9	)			(1.1	)			(54.9	)			(59.5	)
Book value			164.2				163.9				9.7				9.5				300.1				295.5
Fair value			620.4				521.0				9.5				9.7				395.8				350.6
Maturity date			November 2029								October 2012								November 2013
Stated annual interest rate			4.50% until Nov 2019 2.25% until Nov 2029								1.00% until Oct 2012								0.875% until Nov 2013
Interest payments			Semi-annually: May 15 & November 15								Semi-annually: April 15 & October 15								Semi-annually: May 15 & November 15

The 1.00% Senior Convertible Notes and the 0.875% Convertible Notes are unconditionally guaranteed, jointly and severally, on a senior unsecured basis, by the Company’s wholly-owned U.S. and Canadian subsidiaries. For additional information on the convertible notes, refer to the Company’s 2010 Annual Report on Form 10-K.

Subordinated Convertible Notes

The Company’s Subordinated Convertible Notes were issued on December 15, 2009 in the amount of $429.5 million. The notes and the common stock issuable upon conversion were registered on a Registration Statement on Form S-4, initially filed with the SEC on October 27, 2009, as amended and as declared effective by the SEC on December 15, 2009. At issuance, the Company separately accounted for the liability and equity components of the instrument, based on the Company’s nonconvertible debt borrowing rate on the instrument’s issuance date of 12.5%. At issuance, the liability and equity components were $162.9 million and $266.6 million, respectively. The equity component (debt discount) is being amortized to interest expense based on the effective interest method. There were no proceeds generated from the transaction and the Company incurred issuance fees and expenses of approximately $14.5 million as a result of the exchange offer which have been proportionately allocated to the liability and equity components of the subordinate notes due in 2029.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

1.00% Senior Convertible Notes

As a result of the aforementioned exchange offer of Subordinated Convertible Notes due in 2029, approximately 97.8% or $464.4 million of the Company’s 1.00% Senior Convertible Notes were validly tendered. As of December 15, 2009, there were $10.6 million of the 1.00% Senior Convertible Notes outstanding. The Company’s 1.00% Senior Convertible Notes were originally issued in September 2007 in the amount of $475.0 million and sold to qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). Subsequently, on April 16, 2008, the resale of the notes and the common stock issuable upon conversion of the notes was registered on a Registration Statement on Form S-3. The Company separately accounted for the liability and equity components of the instrument based on the Company’s nonconvertible debt borrowing rate on the instrument’s issuance date of 7.5%. At issuance, the liability and equity components were $348.2 million and $126.8 million, respectively. At the exchange date December 15, 2009, the liability and equity components were $389.7 million and $74.7 million, respectively. The equity component (debt discount) is being amortized to interest expense based on the effective interest method.

Proceeds from the 1.00% Senior Convertible Notes were used to partially fund the purchase price of $707.6 million related to the PDIC acquisition and to pay transaction costs of approximately $12.3 million directly related to the issuance which have been allocated to the liability and equity components in proportion to the allocation of proceeds.

0.875% Convertible Notes

The Company’s 0.875% Convertible Notes were issued in November of 2006 in the amount of $355.0 million. At the time of issuance, the notes and the common stock issuable upon conversion of the notes were registered on a Registration Statement on Form S-3ASR which was renewed on September 30, 2009 when the Company filed a Renewal Registration Statement for the underlying common stock on Form S-3ASR. The Company separately accounted for the liability and equity components of the instrument based on the Company’s nonconvertible debt borrowing rate on the instrument’s issuance date of 7.35%. At issuance, the liability and equity components were $230.9 million and $124.1 million, respectively. The equity component (debt discount) is being amortized to interest expense based on the effective interest method.

Concurrent with the sale of the 0.875% Convertible Notes, the Company purchased note hedges that are designed to mitigate potential dilution from the conversion of the 0.875% Convertible Notes in the event that the market value per share of the Company’s common stock at the time of exercise is greater than approximately $50.36. Under the note hedges that cover approximately 7,048,880 shares of the Company’s common stock, the counterparties are required to deliver to the Company either shares of the Company’s common stock or cash in the amount that the Company delivers to the holders of the 0.875% Convertible Notes with respect to a conversion, calculated exclusive of shares deliverable by the Company by reason of any additional make whole premium relating to the 0.875% Convertible Notes or by reason of any election by the Company to unilaterally increase the conversion rate as permitted by the indenture governing the 0.875% Convertible Notes. The note hedges expire at the close of trading on November 15, 2013, which is also the maturity date of the 0.875% Convertible Notes, although the counterparties will have ongoing obligations with respect to 0.875% Convertible Notes properly converted on or prior to that date as to which the counterparties have been timely notified.

The Company issued warrants to counterparties that could require the Company to issue up to approximately 7,048,880 shares of the Company’s common stock in equal installments on each of the fifteen consecutive business days beginning on and including February 13, 2014. The strike price is $76.00 per share, which represents a 92.4% premium over the closing price of the Company’s shares of common stock on November 9, 2006. The warrants are expected to provide the Company with some protection against increases in the common stock price over the conversion price per share.

The note hedges and warrants are separate and legally distinct instruments that bind the Company and the counterparties and have no binding effect on the holders of the 0.875% Convertible Notes. In addition, the note hedges and warrants were recorded as a charge and an increase, respectively, in additional paid-in capital in total equity as separate equity transactions.

Proceeds from the offering were used to decrease outstanding debt $87.8 million, including accrued interest, under the Company’s Amended Credit Facility, to pay $124.5 million for the cost of the note hedges, and to pay transaction costs of approximately $9.4 million directly related to the issuance which have been allocated to the liability and equity components in proportion to the allocation of proceeds. Additionally, the Company received $80.4 million in proceeds from the issuance of the warrants. At the conclusion of these transactions, the net effect of the receipt of the funds from the 0.875% Convertible Notes and the payments and proceeds mentioned above was an increase in cash of approximately $213.7 million, which is being used by the Company for general corporate purposes including acquisitions.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

7.125% Senior Notes and Senior Floating Rate Notes

The Company’s $325.0 million in aggregate principal amount of senior unsecured notes, comprised of $125.0 million of Senior Floating Rate Notes due 2015 (the “Senior Floating Rate Notes”) and $200.0 million of 7.125% Senior Fixed Rate Notes due 2017 (the “7.125% Senior Notes” and together, the “Notes”) were offered and sold in private transactions in accordance with Rule 144A and Regulation S under the Securities Act on March 21, 2007. An exchange offer commenced on June 11, 2007 and was completed on July 26, 2007 to replace the unregistered Notes with registered Notes with like terms pursuant to an effective Registration Statement on Form S-4.

		7.125% Senior Notes								Senior Floating Rate Notes
(in millions)		April 1, 2011				December 31, 2010				April 1, 2011				December 31, 2010
Face value		$	200.0			$	200.0			$	125.0			$	125.0
Fair value			207.0				197.5				121.9				114.4
Interest rate			7.125	%			7.125	%			2.7	%			2.7	%
Interest payment			Semi-annually: Apr 1 & Oct 1								3-month LIBOR rate plus 2.375% Quarterly: Jan 1, Apr 1, Jul 1 & Oct 1
Maturity date			April 2017								July 2015
Guarantee			Jointly and severally guaranteed by the Company’s wholly-owned U.S. and Canadian subsidiaries
Call Option(1)			Beginning Date				Percentage				Beginning Date				Percentage
			April 1, 2012		-		103.563	%			April 1, 2009		-		102.0	%
			April 1, 2013		-		102.375	%			April 1, 2010		-		101.0	%
			April 1, 2014		-		101.188	%			April 1, 2011		-		100.0	%
			April 1, 2015		-		100.000	%

(1)		The Company may, at its option, redeem the Notes on or after the following dates and percentages (plus interest due)

The Notes’ indenture contains covenants that limit the ability of the Company and certain of its subsidiaries to (i) pay dividends on, redeem or repurchase the Company’s capital stock; (ii) incur additional indebtedness; (iii) make investments; (iv) create liens; (v) sell assets; (vi) engage in certain transactions with affiliates; (vii) create or designate unrestricted subsidiaries; and (viii) consolidate, merge or transfer all or substantially all assets. However, these covenants are subject to important exceptions and qualifications, one of which will permit the Company to declare and pay dividends or distributions on the Series A preferred stock provided there is no default on the Notes and certain financial conditions are met.

Proceeds from the Notes of $325.0 million, less approximately $7.9 million of cash payments for fees and expenses that are being amortized over the life of the Notes, were used to pay approximately $285.0 million for 9.5% Senior Notes, $9.3 million for accrued interest on the 9.5% Senior Notes and $20.5 million for tender fees and the inducement premium on the 9.5% Senior Notes, leaving net cash proceeds of approximately $2.3 million which were used for general corporate purposes.

Senior Secured Revolving Credit Facility (“Amended Credit Facility”)

The Company’s current senior secured revolving credit facility (“Amended Credit Facility”), as amended, is a five-year, $400.0 million asset based revolving credit agreement that includes an approximate $50.0 million sublimit for the issuance of commercial and standby letters of credit and a $20.0 million sublimit for swingline loans. The Company under the Amended Credit Facility has the option (subject to certain limitations and conditions) to elect whether loans under the Amended Credit Facility will be LIBOR loans or alternative base rate loans. Eurodollar loans bear interest at a rate equal to an adjusted LIBOR rate plus an applicable margin percentage, ranging from 1.125% to 1.875% and alternative base rate loans bear interest at a rate equal to an alternative base rate plus an applicable margin percentage ranging from 0.00% to 0.625%. The applicable margin percentage is subject to adjustments based upon the excess availability, as defined in the Amended Credit Facility. Indebtedness under the Amended Credit Facility is guaranteed by the Company’s U.S. and Canadian subsidiaries and is secured by a first priority security interest in tangible and intangible property and assets of the Company’s U.S. and Canadian subsidiaries. The lenders have also received a pledge of all of the capital stock of the Company’s existing U.S. subsidiaries and any future U.S. subsidiaries.

The Amended Credit Facility requires that the Company comply with certain financial and negative covenants, the principal covenant of which is a quarterly minimum fixed charge coverage ratio test, which is only applicable when excess availability, as defined, is below a certain threshold. However, the Company will be permitted to declare and pay dividends or distributions on the Series A preferred stock so long as there is no default under the Amended Credit Facility and certain financial conditions are met.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

The Company pays quarterly fees in connection with the issuance of letters of credit and commitment fees equal to 25 basis points, per annum on any unused commitments under the Amended Credit Facility. Both fees are payable quarterly. In connection with the original issuance and related subsequent amendments to the Amended Credit Facility, the Company incurred fees and expenses aggregating $11.1 million, which are being amortized over the term of the Amended Credit Facility.

The Company’s Amended Credit Facility is summarized in the table below:

		Amended credit facility
(in millions)		April 1, 2011				December 31, 2010
Outstanding borrowings		$	48.7			$	—
Undrawn availability			332.9				371.5
Interest rate			2.3	%			—
Outstanding letters of credit			18.4				18.5
Original issuance			November 2003
Maturity date			July 2012

Spanish Term Loans

The table below provides a summary of the Company’s term loans and corresponding fixed interest rate swaps. The proceeds from the Spanish Term Loans were used to partially fund the acquisition of Enica Biskra and for general working capital purposes. There is no remaining availability under these Spanish Term Loans.

		Spanish Term Loans(1)
(in millions)		April 1, 2011				December 31, 2010
Outstanding borrowings		$	46.8			$	50.1
Interest rate — weighted average(2)			3.7	%			3.7	%

(1)		The terms of the Spanish Term Loans are as follows:

Original

Interest rate

(in millions)

Amount

Issuance Date

Maturity Date

Interest rate

Loan and Interest payable

Swap(2)

Term Loan 1

20.0 Euros

February 2008

February 2013

Euribor +0.5%

Semi-annual: Aug & Feb

4.2

%

Term Loan 2

10.0 Euros

April 2008

April 2013

Euribor +0.75%

Semi-annual: Apr & Oct

4.58

%

Term Loan 3

21.0 Euros

June 2008

June 2013

Euribor +0.75%

Quarterly: Mar, Jun, Sept & Dec

4.48

%

Term Loan 4

15.0 Euros

September 2009

August 2014

Euribor +2.0%

Quarterly: Mar, Jun, Sept & Dec

1.54

%

Principal payments: Feb & Aug

(2)		The Company entered into fixed interest rate swaps to coincide with the terms and conditions of the term loans that will effectively hedge the variable interest rate with a fixed interest rate.

Europe and Mediterranean Credit Facilities

The Company’s Europe and Mediterranean credit facilities are summarized in the table below:

		Europe and Mediterranean credit facilities
(in millions)		April 1, 2011				December 31, 2010
Outstanding borrowings		$	26.4			$	38.1
Undrawn availability			134.8				125.4
Interest rate — weighted average			5.0	%			3.1	%
Maturity date			Various

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

Europe and Mediterranean Uncommitted Accounts Receivable Facilities

The Company’s Europe and Mediterranean uncommitted accounts receivable facilities are summarized in the table below:

		Uncommitted accounts receivable facilities
(in millions)		April 1, 2011				December 31, 2010
Outstanding borrowings		$	—			$	—
Undrawn availability			85.0				113.7
Interest rate — weighted average			—				—
Maturity date			Various

The Spanish Term Loans and certain credit facilities held by the Company’s Spain subsidiary are subject to certain financial ratios of the Company’s European subsidiaries, which include minimum net equity and net debt to EBITDA (earnings before interest, taxes, depreciation and amortization). At April 1, 2011 and December 31, 2010, the Company was in compliance with all covenants under these facilities.

ROW credit facilities

The Company’s ROW credit facilities are summarized in the table below:

		ROW credit facilities
(in millions)		April 1, 2011				December 31, 2010
Outstanding borrowings		$	150.8			$	79.1
Undrawn availability			221.7				279.3
Interest rate — weighted average			3.7	%			3.4	%
Maturity date			Various

The Company’s ROW credit facilities are short term loans utilized for working capital purposes. Certain credit facilities are subject to financial covenants. The Company was in compliance with all covenants under these facilities as of April 1, 2011 and December 31, 2010.

9. Financial Instruments

The Company is exposed to various market risks, including changes in interest rates, foreign currency and raw material (commodity) prices. To manage risks associated with the volatility of these natural business exposures the Company enters into interest rate, commodity and foreign currency derivative agreements, as well as copper and aluminum forward pricing agreements. The Company does not purchase or sell derivative instruments for trading purposes. The Company does not engage in trading activities involving derivative contracts for which a lack of marketplace quotations would necessitate the use of fair value estimation techniques.

General Cable utilizes interest rate swaps to manage its interest expense exposure by fixing its interest rate on a portion of the Company’s floating rate debt. The Company has entered into interest rate swaps on the Company’s Spanish Term Loans with a notional value of $47.6 million and $48.8 million as of April 1, 2011 and December 31, 2010, respectively. In addition, the Company has one outstanding interest rate swap with a notional value of $9.0 million that provides for a fixed interest rate of 4.49% maturing in October 2011. The Company does not provide or receive any collateral specifically for this contract. The fair value of interest rate derivatives, which are designated as and qualify as cash flow hedges, are based on quoted market prices, which reflect the present values of the difference between estimated future variable-rate receipts and future fixed-rate payments.

The Company enters into commodity instruments to hedge the purchase of copper, aluminum and lead in future periods and foreign currency exchange contracts principally to hedge the currency fluctuations in certain transactions denominated in foreign currencies, thereby limiting the Company’s risk that would otherwise result from changes in exchange rates. Principal transactions hedged during the year were firm sales and purchase commitments. The fair value of foreign currency contracts represents the amount required to enter into offsetting contracts with similar remaining maturities based on quoted market prices.

We account for these commodity instruments and foreign currency exchange contracts as cash flow or economic hedges. Changes in the fair value of derivatives that are designated as cash flow hedges are recorded in other comprehensive income and reclassified to the income statement when the effects of the items being hedged are realized. Changes in the fair value of economic hedges are recognized in current period earnings.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

Fair Value of Derivatives Instruments

The notional amounts and fair values of derivatives designated as cash flow hedges and derivatives not designated as cash flow hedges at April 1, 2011 and December 31, 2010 are shown below (in millions).

		April 1, 2011												December 31, 2010
		Notional				Fair Value								Notional				Fair Value
		Amount				Asset (1)				Liability (2)				Amount				Asset (1)				Liability (2)
Derivatives designated as cash flow hedges:
Interest rate swaps		$	56.6			$	0.2			$	1.0			$	57.8			$	—			$	1.8
Commodity futures			277.2				19.3				4.8				164.6				30.6				—
Foreign currency exchanges			67.6				1.8				2.0				115.2				1.4				3.1
						$	21.3			$	7.8							$	32.0			$	4.9
Derivatives not designated as cash flow hedges:
Commodity futures		$	113.1			$	1.7			$	8.4			$	91.6			$	1.4			$	7.9
Foreign currency exchanges			325.6				6.4				5.9				230.3				3.1				3.4
						$	8.1			$	14.3							$	4.5			$	11.3

(1)		Balance recorded in “Prepaid expenses and other” and “Other non-current assets”
(2)		Balance recorded in “Accrued liabilities” and “Other liabilities”

Depending on the extent of an unrealized loss position on a derivative contract held by the Company, certain counterparties may require collateral to secure the Company’s derivative contract position. As of April 1, 2011 and December 31, 2010, there were no contracts held by the Company that required collateral to secure the Company’s derivative liability positions.

For the above derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the unrealized gain and loss on the derivative is reported as a component of accumulated other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings, which generally occurs over periods of less than one year. Gain and loss on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings.

		April 1, 2011
										Ineffective portion and
		Effective Portion				Reclassified from				amount excluded from
		recognized in OCI				Accumulated OCI				effectiveness testing
		Gain / (Loss)				Gain / (Loss)				Gain / (Loss)				Location
Derivatives designated as cash flow hedges:
Interest rate swaps		$	(0.4	)		$	—			$	(0.1	)		Interest Expense
Commodity futures			0.3				17.3				0.1			Cost of Sales
Foreign currency exchanges			2.6				(0.4	)			(0.1	)		Other income / (expense)
Total		$	2.5			$	16.9			$	(0.1	)

		April 2, 2010
										Ineffective portion and
		Effective Portion				Reclassified from				amount excluded from
		recognized in OCI				Accumulated OCI				effectiveness testing
		Gain / (Loss)				Gain / (Loss)				Gain / (Loss)				Location
Derivatives designated as cash flow hedges:
Interest rate swaps		$	1.7			$	(0.1	)		$	0.1			Interest Expense
Commodity futures			23.1				(7.0	)			—			Cost of Sales
Foreign currency exchanges			(5.1	)			(0.9	)			(0.8	)		Other income / (expense)
Total		$	19.7			$	(8.0	)		$	(0.7	)

For derivative instruments that are not designated as cash flow hedges, the unrealized gain or loss on the derivatives is reported in current earnings. For the three fiscal months ended April 1, 2011 and April 2, 2010, the Company recorded a gain of $6.0 million and a loss of $0.4 million, respectively, for derivatives instruments not designated as cash flow hedges in other income/(expense) on the condensed consolidated statements of operations.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

Other Forward Pricing Agreements

In the normal course of business, General Cable enters into forward pricing agreements for the purchase of copper and aluminum for delivery in a future month to match certain sales transactions. The Company accounts for these forward pricing arrangements under the “normal purchases and normal sales” scope exemption because these arrangements are for purchases of copper and aluminum that will be delivered in quantities expected to be used by the Company over a reasonable period of time in the normal course of business. For these arrangements, it is probable at the inception and throughout the life of the arrangements that the arrangements will not settle net and will result in physical delivery of the inventory. At April 1, 2011 and December 31, 2010, the Company had $39.2 million and $30.8 million, respectively, of future copper and aluminum purchases that were under forward pricing agreements. At April 1, 2011 and December 31, 2010, the fair value of these arrangements was $39.1 million and $35.6 million, respectively, and the Company had an unrealized loss of $0.1 million and an unrealized gain of $4.8 million, respectively, related to these transactions. The Company believes the unrealized gains (losses) under these agreements will be largely offset as a result of firm sales price commitments with customers. Depending on the extent of the unrealized loss position on certain forward pricing agreements, certain counterparties may require collateral to secure the Company’s forward purchase agreements. There were no funds posted as collateral as of April 1, 2011 or December 31, 2010.

10. Income Taxes

During the first quarter of 2011, the Company accrued approximately $2.8 million of income tax expense for uncertain tax positions likely to be taken in the current year and for interest and penalties on tax positions taken in prior periods, all of which would have a favorable impact on the effective tax rate, if recognized. The Company recognized a tax benefit of $1.6 million (including penalties and interest) in the first quarter of 2011 due to statute of limitations expirations for certain tax exposures.

The Company files income tax returns in numerous tax jurisdictions around the world. Due to uncertainties regarding the timing and outcome of various tax audits, appeals and settlements, it is difficult to reliably estimate the amount of unrecognized tax benefits that could change within the next twelve months. The Company believes it is reasonably possible that approximately $15 million of unrecognized tax benefits could change within the next twelve months due to the resolution of tax audits and statute of limitations expirations.

In the first quarter of 2011, the Internal Revenue Service’s examination of the Company’s 2007 and 2008 consolidated income tax returns was completed with no significant tax adjustments. With limited exceptions, tax years prior to 2006 are no longer open in major foreign, state or local tax jurisdictions.

11. Employee Benefit Plans

General Cable provides retirement benefits through contributory and noncontributory qualified and non-qualified defined benefit pension plans covering eligible domestic and international employees as well as through defined contribution plans and other postretirement benefits.

Defined Benefit Pension Plans

Benefits under General Cable’s qualified U.S. defined benefit pension plan generally are based on years of service multiplied by a specific fixed dollar amount, and benefits under the Company’s qualified non-U.S. defined benefit pension plans generally are based on years of service and a variety of other factors that can include a specific fixed dollar amount or a percentage of either current salary or average salary over a specific period of time. The amounts funded for any plan year for the qualified U.S. defined benefit pension plan are neither less than the minimum required under federal law nor more than the maximum amount deductible for federal income tax purposes. The Company’s non-qualified unfunded U.S. defined benefit pension plans include a plan that provides defined benefits to select senior management employees beyond those benefits provided by other programs. The Company’s non-qualified unfunded non-U.S. defined benefit pension plans include plans that provide retirement indemnities to employees within the Company’s European and ROW segments. Pension obligations for the majority of non-qualified unfunded defined benefit pension plans are provided for by book reserves and are based on local practices and regulations of the respective countries. The Company makes cash contributions for the costs of the non-qualified unfunded defined benefit pension plans as the benefits are paid.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

The components of net periodic benefit cost for pension benefits were as follows (in millions):

		Three Fiscal Months Ended
		April 1, 2011								April 2, 2010
		U.S. Plans				Non-U.S Plans				U.S. Plans				Non-U.S. Plans
Service cost		$	0.4			$	0.8			$	0.4			$	0.6
Interest cost			2.1				1.5				2.1				1.4
Expected return on plan assets			(2.4	)			(0.6	)			(2.1	)			(0.4	)
Amortization of prior service cost			0.1				0.1				—				—
Amortization of net loss			1.1				0.3				1.3				0.1
Amortization of translation obligation			—				0.1				—				—
Net pension expense		$	1.3			$	2.2			$	1.7			$	1.7

Defined benefit pension plan cash contributions for the three fiscal months ended April 1, 2011 and April 2, 2010 were $3.0 million and $1.9 million, respectively.

Postretirement Benefits Other Than Pensions

General Cable has postretirement benefit plans that provide medical and life insurance for certain retirees and eligible dependants. The Company funds the plans as claims or insurance premiums are incurred.

Net postretirement benefit expense included the following components (in millions):

		Three Fiscal Months Ended
		April 1, 2011				April 2, 2010
Postretirement benefit expense:
Service cost		$	0.1			$	0.1
Interest cost			0.1				0.1
Net postretirement benefit expense		$	0.2			$	0.2

Defined Contribution Plans

Expense under both U.S. and non-U.S. defined contribution plans generally equals up to six percent of each eligible employee’s covered compensation based on the location and status of the employee. The net defined contribution plan expense recognized for the three fiscal months ended April 1, 2011 and April 2, 2010 was $2.6 million and $2.2 million, respectively.

12. Total Equity

General Cable is authorized to issue 200 million shares of common stock and 25 million shares of preferred stock.

Condensed consolidated statements of changes in equity are presented below for April 1, 2011 and April 2, 2010.

						Company common shareholders
																										Accumulated
														Add’l												Other
						Preferred				Common				Paid in				Treasury				Retained				Comprehensive				Noncontrolling
		Total				Stock				Stock				Capital				Stock				Earnings				Income/(Loss)				Interest
Balance, December 31, 2010		$	1,605.3			$	3.8			$	0.6			$	652.8			$	(74.0	)		$	875.3			$	23.5			$	123.3
Comprehensive income (loss):
Net income (loss) including noncontrolling interest			39.1																				38.3								0.8
Foreign currency translation adj.			43.1																								43.3				(0.2	)
Gain (loss) defined benefit plan			—																								0.4				(0.4	)
Unrealized gain (loss) on financial instruments			(14.5	)																							(14.5	)			—
Comprehensive income (loss)			67.7
Preferred stock dividend			(0.1	)																			(0.1	)
Excess tax benefit from stock compensation			0.7												0.7
Other — Issuance pursuant to restricted stock, stock options and other benefits plans			1.0												3.0				(0.7	)											(1.3	)
Balance, April 1, 2011		$	1,674.6			$	3.8			$	0.6			$	656.5			$	(74.7	)		$	913.5			$	52.7			$	122.2

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

						Company common shareholders
																										Accumulated
														Add’l												Other
						Preferred				Common				Paid in				Treasury				Retained				Comprehensive				Noncontrolling
		Total				Stock				Stock				Capital				Stock				Earnings				Income/(Loss)				Interest
Balance, December 31, 2009		$	1,509.8			$	3.8			$	0.6			$	637.1			$	(72.9	)		$	806.1			$	(8.9	)		$	144.0
Comprehensive income (loss):
Net income (loss) including noncontrolling interest			(5.1	)																			(7.7	)							2.6
Foreign currency translation adj.			(19.5	)																							(5.1	)			(14.4	)
Unrealized gain (loss) on financial instruments			4.4																								3.7				0.7
Comprehensive income (loss)			(20.2	)
Preferred stock dividend			(0.1	)																			(0.1	)
Other — Issuance pursuant to restricted stock, stock options and other benefits plans			2.2												2.4				(0.2	)
Balance, April 2, 2010		$	1,491.7			$	3.8			$	0.6			$	639.5			$	(73.1	)		$	798.3			$	(10.3	)		$	132.9

The components of accumulated other comprehensive income (loss) as of April 1, 2011 and December 31, 2010, respectively, consisted of the following (in millions):

		April 1, 2011								December 31, 2010
		Company								Company
		common				Noncontrolling				common				Noncontrolling
		shareholders				Interest				shareholders				interest
Foreign currency translation adjustment		$	96.8			$	(15.0	)		$	53.5			$	(14.8	)
Pension adjustments, net of tax			(47.0	)			(1.2	)			(47.4	)			(0.8	)
Change in fair value of derivatives, net of tax			(4.7	)			(0.5	)			9.8				(0.5	)
Company deferred stock held in rabbi trust, net of tax			7.3				—				7.3				—
Other			0.3				—				0.3				—
Accumulated other comprehensive income (loss)		$	52.7			$	(16.7	)		$	23.5			$	(16.1	)

Comprehensive income consists of the following (in millions):

		Three Fiscal Months Ended
		April 1, 2011								April 2, 2010
		Company								Company
		common				Noncontrolling				common				Noncontrolling
		shareholders				interest				shareholders				interest
Net income (loss) (1)		$	38.3			$	0.8			$	(7.7	)		$	2.6
Currency translation gain (loss)			43.3				(0.2	)			(5.1	)			(14.4	)
Change in fair value of pension plan benefit			0.4				(0.4	)			—				—
Change in fair value of derivatives, net of tax			(14.5	)			—				3.7				0.7
Comprehensive income (loss)		$	67.5			$	0.2			$	(9.1	)		$	(11.1	)

(1)		Net income before preferred stock dividend payments.

The Company maintains a deferred compensation plan (“Deferred Compensation Plan”) under the terms and conditions disclosed in the Company’s 2010 Annual Report on Form 10-K. The Company accounts for the Deferred Compensation Plan in accordance with “ASC 710 Compensation — General” as it relates to arrangements where amounts earned are held in a rabbi trust. The market value of mutual fund investments, nonvested and subsequently vested stock and restricted stock in the rabbi trust was $46.0 million and $39.3 million as of April 1, 2011 and December 31, 2010, respectively. The market value of the assets held by the rabbi trust, exclusive of the market value of the shares of the Company’s nonvested and subsequently vested restricted stock, restricted stock units held in the deferred compensation plan and Company stock investments by participants’ elections, at April 1, 2011 and December 31, 2010 was $17.2 million and $16.0 million, respectively, and is classified as “other non-current assets” in the condensed consolidated balance sheets. Amounts payable to the plan participants at April 1, 2011 and December 31, 2010, excluding the market value of the shares of the Company’s nonvested and subsequently vested restricted stock and restricted stock units held, was $19.8 million and $18.3 million, respectively, and is classified as “other liabilities” in the condensed consolidated balance sheets.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

13. Share-Based Compensation

General Cable has various plans which provide for granting options, restricted stock units and restricted common stock to certain employees and independent directors of the Company and its subsidiaries. The Company recognizes compensation expense for share-based payments based on the fair value of the awards at the grant date. The table below summarizes compensation expense for the Company’s non-qualified stock options, non-vested stock awards, including restricted stock units, and performance-based non-vested stock awards based on the fair value method as estimated using the Black-Scholes valuation model for the three fiscal months ended April 1, 2011 and April 2, 2010.

		Three Fiscal Months Ended
		April 1, 2011				April 2, 2010
Non-qualified stock option expense		$	1.1			$	1.1
Non-vested stock awards expense			1.6				1.3
Total pre-tax share-based compensation expense		$	2.7			$	2.4
Excess tax benefit (deficiency) on share-based compensation (1)		$	0.7			$	—

(1)		Cash inflows (outflows) recognized as financing activities in the condensed consolidated statements of cash flows.

The Company records compensation expense related to non-vested stock awards as a component of selling, general and administrative expense. There have been no material changes in financial condition or operations that would affect the method or the nature of the share-based compensation recorded in the current period or the prior comparative periods.

14. Shipping and Handling Costs

All shipping and handling amounts billed to a customer in a sales transaction are classified as revenue. Shipping and handling costs associated with storage and handling of finished goods and shipments to customers are included in cost of sales and totaled $34.0 million and $25.6 million, respectively, for the three fiscal months ended April 1, 2011 and April 2, 2010.

15. Earnings (Loss) Per Common Share

The Company applied the two-class method of computing basic and diluted earnings (loss) per share for the three fiscal months ended April 1, 2011 and April 2, 2010. Historically and for the three fiscal months ended April 1, 2011 and April 2, 2010, the Company did not declare, pay or otherwise accrue a dividend payable to the holders of the Company’s common stock or holders of unvested share-based payment awards (restricted stock). A reconciliation of the numerator and denominator of earnings (loss) per common share — basic to earnings (loss) per common share — assuming dilution is as follows (in millions, except per share data):

		Three Fiscal Months Ended
		April 1, 2011				April 2, 2010
Earnings (loss) per common share — basic:
Net earnings (loss) for basic EPS computation (1)		$	38.2			$	(7.8	)
Weighted average shares outstanding for basic EPS computation (2)			52.1				52.0
Earnings (loss) per common share — basic (3)		$	0.73			$	(0.15	)
Earnings (loss) per common share — assuming dilution
Net earnings (loss)		$	38.2			$	(7.8	)
Add: preferred stock dividends			0.1				0.1
Net earnings (loss) for diluted EPS computation(1)		$	38.3			$	(7.7	)
Weighted average shares outstanding including nonvested shares			52.1				52.0
Dilutive effect of convertible bonds(4)			1.1				—
Dilutive effect of stock options and restricted stock units(4)			0.9				—
Dilutive effect of assumed conversion of preferred stock(4)			0.4				—
Weighted average shares outstanding for diluted EPS computation(2)			54.5				52.0
Earnings (loss) per common share — assuming dilution		$	0.70			$	(0.15	)

(1)		Numerator
(2)		Denominator
(3)		Under the two-class method, earnings (loss) per share — basic reflects undistributed earnings (loss) per share for both common stock and unvested share-based payment awards (restricted stock).
(4)		Excluded as any impact would be anti-dilutive for the three months ended April 2, 2010.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited) — (Continued)

Under ASC No. 260 Earnings per Share and ASC No. 470 Debt and because of the Company’s obligation to settle the par value of the 0.875% Convertible Notes, 1.00% Senior Convertible Notes, and the Subordinated Convertible Notes in cash, the Company is not required to include any shares underlying the 0.875% Convertible Notes, 1.00% Senior Convertible Notes and Subordinated Convertible Notes in its weighted average shares outstanding — assuming dilution until the average stock price per share for the quarter exceeds the $50.36, $83.93, and $36.75 conversion price of the 0.875% Convertible Notes, 1.00% Senior Convertible Notes and the Subordinated Convertible Notes, respectively, and only to the extent of the additional shares that the Company may be required to issue in the event that the Company’s conversion obligation exceeds the principal amount of the 0.875% Convertible Notes, the 1.00% Senior Convertible Notes and the Subordinated Convertible Notes.

Regarding the 0.875% Convertible Notes, the average stock price threshold conditions had not been met as of April 1, 2011. At any such time in the future that threshold conditions are met, only the number of shares issuable under the “treasury” method of accounting for the share dilution would be included in the Company’s earnings per share — assuming dilution calculation, which is based upon the amount by which the average stock price exceeds the conversion price. In addition, shares underlying the warrants will be included in the weighted average shares outstanding — assuming dilution when the average stock price per share for a quarter exceeds the $76.00 strike price of the warrants, and shares underlying the note hedges, will not be included in the weighted average shares outstanding — assuming dilution because the impact of the shares will always be anti-dilutive.

The following table provides examples of how changes in the Company’s stock price would require the inclusion of additional shares in the denominator of the weighted average shares outstanding — assuming dilution calculation for the 0.875% Convertible Notes. The table also reflects the impact on the number of shares that the Company would expect to issue upon concurrent settlement of the 0.875% Convertible Notes and the note hedges and warrants.

																						Incremental Shares
						Shares Underlying								Total Treasury				Shares Due to the				Issued by the
						0.875% Convertible				Warrant				Method Incremental				Company under				Company upon
Share Price						Notes				Shares				Shares(1)				Note Hedges				Conversion(2)
$	50.36						—				—				—				—				—
$	60.36						1,167,502				—				1,167,502				(1,167,502	)			—
$	70.36						2,003,400				—				2,003,400				(2,003,400	)			—
$	80.36						2,631,259				382,618				3,013,877				(2,631,259	)			382,618
$	90.36						3,120,150				1,120,363				4,240,513				(3,120,150	)			1,120,363
$	100.36						3,511,614				1,711,088				5,222,702				(3,511,614	)			1,711,088