Supplemental Guarantor And Parent Company Condensed Financial Information

9 Months Ended

Sep. 30, 2011

Supplemental Guarantor And Parent Company Condensed Financial Information

Supplemental Guarantor And Parent Company Condensed Financial Information

20. Supplemental Guarantor and Parent Company Condensed Financial Information

General Cable Corporation ("Parent Company") and its U.S. and Canadian wholly-owned subsidiaries ("Guarantor Subsidiaries") fully and unconditionally guarantee the $10.6 million of 1.00% Senior Convertible Notes, the $355.0 million of 0.875% Convertible Notes, the $200 million of 7.125% Senior Notes due in 2017 and the $125 million of Senior Floating Rate Notes due in 2015 of the Parent Company on a joint and several basis. The following tables present financial information about the Parent Company, Guarantor Subsidiaries and non-guarantor subsidiaries in millions. Intercompany transactions are eliminated.

Condensed Statements of Operations

Three Fiscal Months Ended September 30, 2011

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
Net sales:
Customers	$	—		$	518.4		$	999.4		$	—		$	1,517.8
Intercompany		14.4			—			15.7			(30.1	)		—
		14.4			518.4			1,015.1			(30.1	)		1,517.8
Cost of sales		—			459.2			917.9			(15.7	)		1,361.4
Gross profit		14.4			59.2			97.2			(14.4	)		156.4
Selling, general and administrative expenses		11.5			34.5			61.4			(14.4	)		93.0
Operating income		2.9			24.7			35.8			—			63.4
Other expense		(0.1	)		(2.4	)		(29.0	)		—			(31.5	)
Interest income (expense):
Interest expense		(15.8	)		(17.4	)		(11.1	)		18.9			(25.4	)
Interest income		15.8			3.0			2.3			(18.9	)		2.2
		—			(14.4	)		(8.8	)		—			(23.2	)
Income before income taxes		2.8			7.9			(2.0	)		—			8.7
Income tax provision		(1.0	)		(0.2	)		(4.3	)		—			(5.5	)
Equity in net income of subsidiaries and affiliated companies		1.9			(5.8	)		0.1			4.6			0.8
Net income including noncontrolling interest		3.7			1.9			(6.2	)		4.6			4.0
Less: preferred stock dividends		0.1			—			—			—			0.1
Less: net income attributable to noncontrolling interest		—			—			0.3			—			0.3
Net income attributable to Company common shareholders	$	3.6		$	1.9		$	(6.5	)	$	4.6		$	3.6

Condensed Statements of Operations

Nine Fiscal Months Ended September 30, 2011

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
Net sales:
Customers	$	—		$	1,600.8		$	2,896.8		$	—		$	4,497.6
Intercompany		42.2			—			38.7			(80.9	)		—
		42.2			1,600.8			2,935.5			(80.9	)		4,497.6
Cost of sales		—			1,397.9			2,640.4			(38.7	)		3,999.6
Gross profit		42.2			202.9			295.1			(42.2	)		498.0
Selling, general and administrative expenses		33.5			108.6			181.8			(42.2	)		281.7
Operating income		8.7			94.3			113.3			—			216.3
Other expense		(0.1	)		(1.8	)		(26.5	)		—			(28.4	)
Interest income (expense):
Interest expense		(47.1	)		(55.4	)		(32.4	)		61.9			(73.0	)
Interest income		52.6			9.0			6.5			(61.9	)		6.2
		5.5			(46.4	)		(25.9	)		—			(66.8	)
Income before income taxes		14.1			46.1			60.9			—			121.1
Income tax provision		(5.2	)		(18.4	)		(18.5	)		—			(42.1	)
Equity in net income of subsidiaries and affiliated companies		70.7			43.0			0.1			(111.6	)		2.2
Net income including noncontrolling interest		79.6			70.7			42.5			(111.6	)		81.2
Less: preferred stock dividends		0.3			—			—			—			0.3
Less: net income attributable to noncontrolling interest		—			—			1.6			—			1.6
Net income attributable to Company common shareholders	$	79.3		$	70.7		$	40.9		$	(111.6	)	$	79.3

Condensed Statements of Operations

Three Fiscal Months Ended October 1, 2010

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
Net sales:
Customers	$	—		$	452.3		$	748.2		$	—		$	1,200.5
Intercompany		13.2			—			25.3			(38.5	)		—
		13.2			452.3			773.5			(38.5	)		1,200.5
Cost of sales		—			408.1			692.4			(25.3	)		1,075.2
Gross profit		13.2			44.2			81.1			(13.2	)		125.3
Selling, general and administrative expenses		10.5			28.1			57.8			(13.2	)		83.2
Operating income		2.7			16.1			23.3			—			42.1
Other income		—			1.3			6.4			—			7.7
Interest income (expense):
Interest expense		(15.3	)		(21.3	)		(6.3	)		23.5			(19.4	)
Interest income		20.8			2.5			1.7			(23.5	)		1.5
		5.5			(18.8	)		(4.6	)		—			(17.9	)
Income before income taxes		8.2			(1.4	)		25.1			—			31.9
Income tax provision		(3.1	)		13.2			(20.6	)		—			(10.5	)
Equity in net income of subsidiaries and affiliated companies		13.1			1.3			—			(14.0	)		0.4
Net income including noncontrolling interest		18.2			13.1			4.5			(14.0	)		21.8
Less: preferred stock dividends		0.1			—			—			—			0.1
Less: net income attributable to noncontrolling interest		—			—			3.6			—			3.6
Net income attributable to Company common shareholders	$	18.1		$	13.1		$	0.9		$	(14.0	)	$	18.1

Condensed Statements of Operations

Nine Fiscal Months Ended October 1, 2010

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
Net sales:
Customers	$	—		$	1,285.9		$	2,221.2		$	—		$	3,507.1
Intercompany		38.2			0.3			58.0			(96.5	)		—
		38.2			1,286.2			2,279.2			(96.5	)		3,507.1
Cost of sales		—			1,125.5			2,032.3			(58.3	)		3,099.5
Gross profit		38.2			160.7			246.9			(38.2	)		407.6
Selling, general and administrative expenses		29.9			98.3			158.4			(38.2	)		248.4
Operating income		8.3			62.4			88.5			—			159.2
Other expense		—			(0.6	)		(31.2	)		—			(31.8	)
Interest income (expense):
Interest expense		(45.9	)		(63.3	)		(17.7	)		69.7			(57.2	)
Interest income		61.6			7.8			4.0			(69.7	)		3.7
		15.7			(55.5	)		(13.7	)		—			(53.5	)
Income before income taxes		24.0			6.3			43.6			—			73.9
Income tax provision		(9.0	)		11.2			(35.1	)		—			(32.9	)
Equity in net income of subsidiaries and affiliated companies		19.4			1.9			—			(20.3	)		1.0
Net income including noncontrolling interest		34.4			19.4			8.5			(20.3	)		42.0
Less: preferred stock dividends		0.3			—			—			—			0.3
Less: net income attributable to noncontrolling interest		—			—			7.6			—			7.6
Net income attributable to Company common shareholders	$	34.1		$	19.4		$	0.9		$	(20.3	)	$	34.1

Condensed Balance Sheets

September 30, 2011

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Total
Assets
Current assets:
Cash and cash equivalents	$	0.1		$	15.6		$	400.9	$	—		$	416.6
Receivables, net of allowances		—			297.5			902.4		—			1,199.9
Inventories, net		—			439.5			812.0		—			1,251.5
Deferred income taxes		(0.1	)		27.2			38.6		—			65.7
Prepaid expenses and other		1.8			35.9			83.1		—			120.8
Total current assets		1.8			815.7			2,237.0		—			3,054.5
Property, plant and equipment, net		0.4			186.6			844.4		—			1,031.4
Deferred income taxes		—			1.1			14.5		—			15.6
Intercompany accounts		1,234.6			413.5			32.0		(1,680.1	)		—
Investment in subsidiaries		1,177.6			1,339.6			—		(2,517.2	)		—
Goodwill		—			0.8			164.4		—			165.2
Intangible assets, net		—			3.5			181.1		—			184.6
Unconsolidated affiliated companies		—			12.9			6.0		—			18.9
Other non-current assets		8.7			22.9			40.6		—			72.2
Total assets	$	2,423.1		$	2,796.6		$	3,520.0	$	(4,197.3	)	$	4,542.4
Liabilities and Total Equity
Current liabilities:
Accounts payable	$	—		$	130.9		$	854.4	$	—		$	985.3
Accrued liabilities		5.0			128.7			343.1		—			476.8
Current portion of long-term debt		—			—			183.9		—			183.9
Total current liabilities		5.0			259.6			1,381.4		—			1,646.0
Long-term debt		818.4			20.9			41.3		—			880.6
Deferred income taxes		124.2			(14.7	)		94.7		—			204.2
Intercompany accounts		—			1,266.6			413.5		(1,680.1	)		—
Other liabilities		—			86.6			132.7		—			219.3
Total liabilities		947.6			1,619.0			2,063.6		(1,680.1	)		2,950.1
Total Company shareholders' equity		1,475.5			1,177.6			1,339.6		(2,517.2	)		1,475.5
Noncontrolling interest		—			—			116.8		—			116.8
Total liabilities and equity	$	2,423.1		$	2,796.6		$	3,520.0	$	(4,197.3	)	$	4,542.4

Condensed Balance Sheets

December 31, 2010

	Parent		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Total
Assets
Current assets:
Cash	$	29.0	$	8.0		$	421.7	$	—		$	458.7
Receivables, net of allowances		—		249.7			817.3		—			1,067.0
Inventories, net		—		380.8			738.1		—			1,118.9
Deferred income taxes		—		26.5			13.3		—			39.8
Prepaid expenses and other		1.8		38.3			81.2		—			121.3
Total current assets		30.8		703.3			2,071.6		—			2,805.7
Property, plant and equipment, net		0.4		194.8			844.4		—			1,039.6
Deferred income taxes		—		1.1			10.2		—			11.3
Intercompany accounts		1,169.7		368.0			22.4		(1,560.1	)		—
Investment in subsidiaries		1,202.5		1,361.5			—		(2,564.0	)		—
Goodwill		—		0.8			174.1		—			174.9
Intangible assets, net		—		3.7			195.9		—			199.6
Unconsolidated affiliated companies		—		11.2			6.1		—			17.3
Other non-current assets		10.0		21.6			47.7		—			79.3
Total assets	$	2,413.4	$	2,666.0		$	3,372.4	$	(4,124.1	)	$	4,327.7
Liabilities and Total Equity
Current liabilities:
Accounts payable	$	—	$	110.6		$	811.9	$	—		$	922.5
Accrued liabilities		3.9		103.8			269.0		—			376.7
Current portion of long-term debt		—		—			121.0		—			121.0
Total current liabilities		3.9		214.4			1,201.9		—			1,420.2
Long-term debt		802.9		—			61.6		—			864.5
Deferred income taxes		124.3		(16.7	)		94.8		—			202.4
Intercompany accounts		—		1,161.6			398.5		(1,560.1	)		—
Other liabilities		0.3		104.2			130.8		—			235.3
Total liabilities		931.4		1,463.5			1,887.6		(1,560.1	)		2,722.4
Total Company shareholders' equity		1,482.0		1,202.5			1,361.5		(2,564.0	)		1,482.0
Non-controlling interest		—		—			123.3		—			123.3
Total liabilities and equity	$	2,413.4	$	2,666.0		$	3,372.4	$	(4,124.1	)	$	4,327.7

Condensed Statements of Cash Flows

Nine Fiscal Months Ended September 30, 2011

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Total
Net cash flows of operating activities	$	27.5		$	9.7		$	(76.4	)	$	—	$	(39.2	)
Cash flows of investing activities:
Capital expenditures		(0.2	)		(14.5	)		(71.5	)		—		(86.2	)
Proceeds from properties sold		—			0.1			2.8			—		2.9
Acquisitions, net of cash acquired		—			—			—			—		—
Other		—			(16.9	)		17.6			—		0.7
Net cash flows of investing activities		(0.2	)		(31.3	)		(51.1	)		—		(82.6	)
Cash flows of financing activities:
Preferred stock dividends paid		(0.3	)		—			—			—		(0.3	)
Excess tax benefits from stock-based compensation		1.0			—			—			—		1.0
Intercompany accounts		(58.1	)		8.9			49.2			—		—
Proceeds from revolving credit borrowings		—			687.6			—			—		687.6
Repayments of revolving credit borrowings		—			(666.7	)		—			—		(666.7	)
Proceeds (repayments) of other debt		—			—			51.3			—		51.3
Dividends paid to non-controlling interest		—			—			(3.8	)		—		(3.8	)
Proceeds from exercise of stock options		1.2			—			—			—		1.2
Net cash flows of financing activities		(56.2	)		29.8			96.7			—		70.3
Effect of exchange rate changes on cash and cash equivalents		—			(0.6	)		10.0			—		9.4
Increase (decrease) in cash and cash equivalents		(28.9	)		7.6			(20.8	)		—		(42.1	)
Cash and cash equivalents – beginning of period		29.0			8.0			421.7			—		458.7
Cash and cash equivalents – end of period	$	0.1		$	15.6		$	400.9		$	—	$	416.6

Condensed Statements of Cash Flows

Nine Fiscal Months Ended October 1, 2010

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Total
Net cash flows of operating activities	$	33.6		$	(7.4	)	$	(45.6	)	$	—	$	(19.4	)
Cash flows of investing activities:
Capital expenditures		—			(13.1	)		(69.4	)		—		(82.5	)
Proceeds from properties sold		—			0.1			4.3			—		4.4
Acquisitions, net of cash acquired		—			(3.9	)		(27.8	)		—		(31.7	)
Other, net		—			4.1			(0.7	)		—		3.4
Net cash flows of investing activities		—			(12.8	)		(93.6	)		—		(106.4	)
Cash flows of financing activities:
Preferred stock dividends paid		(0.3	)		—			—			—		(0.3	)
Excess tax benefits from stock-based compensation		0.2			—			—			—		0.2
Intercompany accounts		(26.2	)		17.1			9.1			—		—
Proceeds from revolving credit borrowings		—			11.1			—			—		11.1
Repayments of revolving credit borrowings		—			(11.1	)		—			—		(11.1	)
Proceeds (repayments) of other debt		—			(0.1	)		61.2			—		61.1
Dividends paid to non-controlling interest		—			—			(3.9	)		—		(3.9	)
Proceeds from the exercise of stock options		0.2			—			—			—		0.2
Net cash flows of financing activities		(26.1	)		17.0			66.4			—		57.3
Effect of exchange rate changes on cash and cash equivalents		—			(1.0	)		(38.9	)		—		(39.9	)
Increase (decrease) in cash and cash equivalents		7.5			(4.2	)		(111.7	)		—		(108.4	)
Cash and cash equivalents – beginning of period		22.7			10.2			466.5			—		499.4
Cash and cash equivalents – end of period	$	30.2		$	6.0		$	354.8		$	—	$	391.0

Notes to Parent Company Condensed Financial Information

Basis of Presentation

In accordance with the requirements of Regulation S-X of the Securities and Exchange Commission, restricted net assets of the Company's subsidiaries exceeded 25% of the Company's total consolidated net assets. The Company's Spanish Term Loans include covenants that require its Spanish subsidiary to maintain minimum net assets of 197 million euros. This financial information is condensed and omits many disclosures presented in the Condensed Consolidated Financial Statements and Notes thereto.

Intercompany Activity

The Parent Company and its Guarantor Subsidiaries participate in a cash pooling program. As part of this program, cash balances are generally swept on a daily basis between the Guarantor Subsidiaries' bank accounts and those of the Parent Company. There are a significant number of the Company's subsidiaries that participate in this cash pooling arrangement and there are thousands of transactions per week that occur between the Parent Company and Guarantor Subsidiaries, all of which are accounted for through the intercompany accounts.

Parent Company transactions include interest, dividend, tax payments and intercompany sales transactions related to administrative costs incurred by the Parent Company, which are billed to Guarantor Subsidiaries on a cost-plus basis. These costs are reported in the Parent's "Selling, general and administrative expenses" on the Condensed Consolidated Statement of Operations for the respective period(s). All intercompany transactions are presumed to be settled in cash when they occur and are included in operating activities on the statement of cash flows.

A summary of cash and non-cash transactions of the Parent Company's intercompany account is provided below for the nine fiscal months ended September 30, 2011 and the twelve months ended December 31, 2010:

(in millions)	September 30, 2011			December 31, 2010
Beginning Balance	$	1,169.7		$	1,091.5
Non-cash transactions
Deferred tax		—			30.5
Equity based awards		9.4			9.0
Foreign currency and other		(2.6	)		0.7
Cash transactions		58.1			38.0
Ending Balance	$	1,234.6		$	1,169.7

Dividends

There were no cash dividend payments to the Parent Company from the Guarantor Subsidiaries in the nine fiscal months ended September 30, 2011 or October 1, 2010.

Parent Company Long-Term Debt

At September 30, 2011 and December 31, 2010, the Parent Company was party to the following long-term financing arrangements:

(in millions)	September 30, 2011			December 31, 2010
Subordinated Convertible Notes due 2029	$	429.5		$	429.5
Debt discount on Subordinated Convertible Notes due 2029		(264.7	)		(265.6	)
1.00% Senior Convertible Notes due 2012		10.6			10.6
Debt discount on 1.00% Senior Convertible Notes due 2012		(0.6	)		(1.1	)
0.875% Convertible Notes due 2013		355.0			355.0
Debt discount on 0.875% Convertible Notes due 2013		(45.4	)		(59.5	)
7.125% Senior Notes due 2017		200.0			200.0
Senior Floating Rate Notes		125.0			125.0
Other		9.0			9.0
Total Parent Company debt		818.4			802.9
Less current maturities		—			—
Parent Company Long-term debt	$	818.4		$	802.9

(in millions)	Q3 2012		Q3 2013		Q3 2014		Q3 2015		Q3 2016
Debt maturities twelve month period ending	$	—	$	10.6	$	355.0	$	125.0		—

Long-term debt related to the Parent Company is discussed in Note 8 of the Notes to the Condensed Consolidated Financial Statements.

Commitments and Contingencies

For contingencies and guarantees related to the Parent Company, refer to Note 17 of the Notes to the Condensed Consolidated Financial Statements.