Zacks_Analysts' Blog : General Cable Corp. Beats Estimate - Analyst Blog

General Cable Corporation (BGC) reported fourth-quarter 2010 earnings per share of 66 cents, beating the Zacks Consensus Estimate of 48 cents. The earnings per share were above the prior-year earnings of 16 cents.

Total Revenue

Total revenue, on a metal-adjusted basis, in the quarter increased by 6.9% year over year to $1,357.8 million. Excluding negative effect from foreign currency exchange rate of $46.0 million, sales on metal-adjusted basis increased by 10.5%.

Volume based on metal pounds sold surged 12.8% year over year and 6.3% sequentially. Transmission products sales volume in the United States was at its highest quarterly level. The company is extending its reach in different regions of the world, with special focus on the emerging markets, evident by an equity investment made by it in Pakistan Cables. The product demand in Europe was better than the company’s expectations. Further, the demand for transmission products was also strong in Brazil.

Sales volume in North America, measured in terms of metal pounds sold, was up 18% year over year, in Europe was up 2.8% and in ROW was up 17.2%.

Income and Expenses

Operating income in the quarter was $63.2 million, an increase of 50% year over year, driven by increased sales volume throughout the world, advantages of cost reduction efforts being carried out by the company over the past two years, and certain target reached on submarine energy cable business. Operating margin increased by 120 basis points to 4.7%.

Balance Sheet

Cash and cash equivalents was $458.7 million at the end of the quarter, with long-term debt of $868.0 million and shareholders equity of $1.6 billion.

Outlook

The company expects GAAP earnings per share to be in the range of 36 cents to 46 cents in the first quarter of 2011 and adjusted non-GAAP earnings per share to be in the range of 45 cents to 55 cents. Total revenue is expected to be in the range of $1.4 billion to $1.45 billion.

Headquartered in Highland Heights, Kentucky, General Cable is engaged in the development, design, manufacture, marketing, and distribution of copper, aluminum and fiber optic wire and cable products for the energy, industrial, specialty, and communications markets. The company offers competitive strengths in areas such as breadth of product line, brand recognition, distribution and logistics, sales and service, and operating efficiency.

General Cable Corporation has a Zacks #3 rank (short-term Hold recommendation).