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

For the quarterly period ended June 29, 2007

OR

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

For the transition period from                      to                     .

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		41076-9753
Highland Heights, KY		(Zip Code)
(Address of principal executive offices)

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 is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer þ      Accelerated filer o      Non-accelerated filer 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 August 1, 2007
Common Stock, $0.01 per value		52,515,559

 

 

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 and six fiscal months ended June 29, 2007 and June 30, 2006			3
		Balance Sheets - June 29, 2007 and December 31, 2006			4
		Statements of Cash Flows - For the six fiscal months ended June 29, 2007 and June 30, 2006			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			51
Item 4.		Controls and Procedures			51
PART II		Other Information
Item 1.		Legal Proceedings			52
Item 1A.		Risk Factors			52
Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds			53
Item 3.		Defaults Upon Senior Securities			53
Item 4.		Submission of Matters to a Vote of Security Holders			53
Item 5.		Other Information			53
Item 6.		Exhibits			53
Signature					55
Exhibit Index					56
EX-12.1
EX-31.1
EX-31.2
EX-32.1

PART I. FINANCIAL STATEMENTS

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

GENERAL CABLE CORPORATION AND SUBSIDIARIES

(unaudited)

		Three Fiscal Months Ended								Six Fiscal Months Ended
		June 29,				June 30,				June 29,				June 30,
		2007				2006				2007				2006
Net sales		$	1,172.5			$	987.1			$	2,181.7			$	1,791.4
Cost of sales			999.4				857.6				1,848.8				1,564.3
Gross profit			173.1				129.5				332.9				227.1
Selling, general and administrative expenses			70.1				59.1				138.8				114.5
Operating income			103.0				70.4				194.1				112.6
Other income (expense)			(1.5	)			0.2				(1.5	)			1.0
Interest income (expense):
Interest expense			(10.6	)			(12.3	)			(19.5	)			(22.4	)
Interest income			3.9				0.7				6.9				1.2
Loss on extinguishment of debt			—				—				(25.1	)			—
			(6.7	)			(11.6	)			(37.7	)			(21.2	)
Income before income taxes			94.8				59.0				154.9				92.4
Income tax provision			(31.9	)			(17.5	)			(54.1	)			(29.5	)
Net income			62.9				41.5				100.8				62.9
Less: preferred stock dividends			(0.1	)			(0.1	)			(0.2	)			(0.2	)
Net income applicable to common shareholders		$	62.8			$	41.4			$	100.6			$	62.7
Earnings per share
Earnings per common share-basic		$	1.23			$	0.81			$	1.97			$	1.24
Weighted average common shares-basic			51.2				50.8				51.1				50.4
Earnings per common share-assuming dilution		$	1.15			$	0.80			$	1.87			$	1.21
Weighted average common shares-assuming dilution			54.7				52.2				53.8				51.8

See accompanying Notes to Condensed Consolidated Financial Statements.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

(unaudited)

		June 29,				December 31,
		2007				2006
Assets
Current Assets:
Cash and cash equivalents		$	382.4			$	310.5
Receivables, net of allowances of $12.5 million at June 29, 2007 and $10.0 million at December 31, 2006			978.9				723.7
Inventories			633.4				563.1
Deferred income taxes			110.1				104.1
Prepaid expenses and other			44.1				32.9
Total current assets			2,148.9				1,734.3
Property, plant and equipment, net			448.2				416.7
Deferred income taxes			26.5				28.8
Other non-current assets			56.1				38.9
Total assets		$	2,679.7			$	2,218.7
Liabilities and Shareholders’ Equity
Current Liabilities:
Accounts payable		$	803.4			$	655.4
Accrued liabilities			340.7				284.3
Current portion of long-term debt			434.1				55.5
Total current liabilities			1,578.2				995.2
Long-term debt			375.7				685.1
Deferred income taxes			12.4				13.2
Other liabilities			161.5				90.8
Total liabilities			2,127.8				1,784.3
Commitments and Contingencies
Shareholders’ Equity:
Redeemable convertible preferred stock, at redemption value (liquidation preference of $50.00 per share): June 29, 2007 — 101,949 outstanding shares December 31, 2006 — 101,949 outstanding shares			5.1				5.1
Common stock, $0.01 par value, issued and outstanding shares: June 29, 2007 — 52,336,036 (net of 5,098,598 treasury shares) December 31, 2006 — 52,002,052 (net of 4,999,035 treasury shares)			0.6				0.6
Additional paid-in capital			263.0				245.5
Treasury stock			(59.2	)			(53.0	)
Retained earnings			320.7				238.8
Accumulated other comprehensive income (loss)			21.7				(2.6	)
Total shareholders’ equity			551.9				434.4
Total liabilities and shareholders’ equity		$	2,679.7			$	2,218.7

See accompanying Notes to Condensed Consolidated Financial Statements.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

		Six Fiscal Months Ended
		June 29,				June 30,
		2007				2006
Cash flows of operating activities:
Net income		$	100.8			$	62.9
Adjustments to reconcile net income to net cash flows of operating activities:
Depreciation and amortization			28.7				25.5
Loss on extinguishment of debt			25.1				—
Foreign currency exchange (gain) loss			1.5				(1.0	)
Deferred income taxes			(4.8	)			2.6
Excess tax benefits from stock-based compensation			(9.3	)			(8.4	)
Loss on disposal of property			0.8				0.8
Changes in operating assets and liabilities, net of effect of acquisitions and divestitures:
Increase in receivables			(212.6	)			(223.9	)
Increase in inventories			(31.5	)			(17.3	)
Increase in other assets			(0.5	)			(7.3	)
Increase in accounts payable, accrued and other liabilities			147.9				171.2
Net cash flows of operating activities			46.1				5.1
Cash flows of investing activities:
Capital expenditures			(45.7	)			(22.6	)
Proceeds from properties sold			0.6				0.4
Proceeds from acquisitions including cash acquired			17.0				—
Acquisitions, net of cash acquired			(5.9	)			(13.7	)
Other, net			1.7				1.6
Net cash flows of investing activities			(32.3	)			(34.3	)
Cash flows of financing activities:
Preferred stock dividends paid			(0.2	)			(0.2	)
Excess tax benefits from stock-based compensation			9.3				8.4
Proceeds from revolving credit borrowings			—				101.3
Repayments of revolving credit borrowings			—				(120.4	)
Issuance of long-term debt, net of fees and expenses			318.3				—
Repayments of long-term debt, including fees and expenses			(300.6	)			—
Proceeds of other debt			22.8				9.7
Proceeds from exercise of stock options			5.2				14.8
Net cash flows of financing activities			54.8				13.6
Effect of exchange rate changes on cash and cash equivalents			3.3				2.4
Increase (decrease) in cash and cash equivalents			71.9				(13.2	)
Cash and cash equivalents — beginning of period			310.5				72.2
Cash and cash equivalents — end of period		$	382.4			$	59.0
Supplemental Information
Cash paid during the period for:
Income tax payments, net of refunds		$	27.8			$	15.8
Interest paid		$	31.4			$	19.4
Non-cash investing and financing activities:
Issuance of nonvested shares		$	3.5			$	5.5
Entrance into capital leases		$	—			$	0.1

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 have been prepared in accordance with accounting principles generally accepted in the United States of America 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 accounting principles generally accepted in the United States of America 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 and six fiscal months ended June 29, 2007, are not necessarily indicative of results that may be expected for the full year. The December 31, 2006, condensed consolidated balance sheet amounts are derived from the audited financial statements but do not include all disclosures herein required by accounting principles generally accepted in the United States of America. These financial statements should be read in conjunction with the audited financial statements and notes thereto in General Cable’s 2006 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 1, 2007. The Company’s fiscal year end is December 31. 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. New Accounting Standards

In May 2007, FASB Staff Position (“FSP”) FIN 48-1, “Definition of Settlement in FASB Interpretation No. 48,” was issued. FSP FIN 48-1 provides guidance on how to determine whether a tax position is effectively settled for the purpose of recognizing previously unrecognized tax benefits. FSP FIN 48-1 is effective retroactively to January 1, 2007. The implementation of this standard did not have a material impact on the Company’s consolidated financial position, results of operations and cash flows.

In February 2007, SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities – Including an Amendment of FASB Statement No. 115, was issued. This statement provides companies an irrevocable option to carry the majority of financial assets and liabilities at fair value, with changes in fair value recorded in earnings. The election of the fair value option is applied on an instrument-by-instrument basis to entire financial assets and liabilities that are individually transferable in their current form. The statement will require extensive disclosures, including reporting assets and liabilities that are measured at fair value separately on the face of the balance sheet. SFAS No. 159 is effective for financial statements issued for fiscal years beginning after November 15, 2007. The Company is currently evaluating the impact of adopting SFAS No. 159 on its consolidated financial position, results of operations and cash flows.

In September 2006, SFAS No. 157, Fair Value Measurements, was issued. This statement provides a new definition of fair value that serves to replace and unify old fair value definitions so that consistency on the definition is achieved, and the definition acts as a modification of the current accounting presumption that a transaction price of an asset or liability equals its initial fair value. The statement also provides a fair value hierarchy used to classify source information used in fair value measurements that places higher importance on market based sources. New disclosures of assets and liabilities measured at fair value based on their level in the fair value hierarchy are required by this statement. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007. The Company is currently evaluating the impact of adopting SFAS No. 157 on its consolidated financial position, results of operations and cash flows.

In July 2006, FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes,” was issued. This Interpretation clarifies accounting for uncertain tax positions in accordance with SFAS No. 109. FIN 48 prescribes a recognition threshold that a tax position is required to meet before being recognized in the financial statements and provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition issues. This Interpretation is effective for fiscal years beginning after December 15, 2006. The adoption of Interpretation 48 decreased shareholders’ equity as of January 1, 2007 by approximately $18.8 million. See Note 9 for additional information.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

In June 2006, the FASB ratified the consensus reached in EITF 06-3, “How Taxes Collected from Customers and Remitted to Governmental Authorities Should Be Presented in the Income Statement (That Is, Gross versus Net Presentation).” EITF 06-3 requires disclosure of a company’s accounting policy with respect to taxes assessed by a governmental authority that are directly imposed on a revenue-producing transaction between a seller and a customer including, but not limited to, sales, use, value added, and some excise taxes. EITF 06-3 is effective for fiscal years beginning after December 15, 2006. EITF 06-3 did not have a material impact on the Company’s consolidated financial position, results of operations and cash flows, and the Company presents such taxes on a net basis.

3. Acquisitions and Divestitures

On April 30, 2007, the Company acquired Norddeutsche Seekabelwerke GmbH & Co. KG (“NSW”), located in Nordenham, Germany from Corning Incorporated. As a result of the transaction, the Company assumed liabilities in excess of the assets acquired, including approximately $41.9 million of pension liabilities. The Company received proceeds of $17.0 million, including $12.3 million in cash acquired.

A preliminary purchase price allocation based on the estimated fair values, or other measurements as applicable, of the assets acquired and the liabilities assumed at the date of acquisition is as follows (in millions at the prevailing exchange rate at April 30, 2007):

		As of
		April 30, 2007
Cash		$	12.3
Accounts receivable			21.8
Inventories			27.4
Property, plant and equipment			0.9
Other current and noncurrent assets			1.6
Total assets		$	64.0
Current liabilities		$	38.2
Other liabilities			0.9
Pension liabilities			41.9
Total liabilities		$	81.0

The Company has not yet finalized portions of the purchase price allocation, including external valuations, and certain closing settlement adjustments in establishing the acquisition opening balance sheet. These valuations are expected to be completed by the end of the second quarter of 2008, and may result in changes to the value assigned above to property, plant and equipment and result in the recognition of intangible assets.

NSW had revenues of approximately $120 million in 2006 (based on 2006 average exchange rates) and has approximately 400 employees. NSW offers complete solutions for submarine cable systems including manufacturing, engineering, seabed mapping, project management, and installation for the offshore communications, energy exploration, transmission, distribution, and alternative energy markets. Pro forma results of the NSW acquisition are not material.

On April 17, 2007, the Company formed a joint venture, Navratna Energy Cable Private Limited (“Navratna Energy”) with the Plaza Cable Group headquartered in New Delhi, India. The Company holds a majority interest in the joint venture, which was established in order to manufacture low and medium voltage energy cables for the Indian market. Pro forma results of the formation of the joint venture are not material.

On February 16, 2007, the Company completed the acquisition of Jiangyin Huaming Specialty Cable Co. Ltd., a manufacturer of specialty automotive and industrial cable products located in Jiangsu province, China. The new subsidiary, General Cable Jiangyin Co. Ltd. (“Jiangyin”), with annual revenues of approximately $12 million (based on 2006 average exchange rates), employs approximately 200 associates. Pro forma results of the Jiangyin acquisition are not material.

On August 31, 2006, the Company completed the acquisition of E.C.N. Cable Group, S.L. (“ECN Cable”) for a final purchase price of $13.2 million in cash and the assumption of $38.6 million in ECN Cable debt (at prevailing exchange rates during the period), including fees and expenses and net of cash acquired. ECN Cable is based in Bilbao, Spain and employs approximately 200 associates. In 2005, the last full year prior to acquisition, ECN Cable reported global sales of approximately $71.5 million (based on 2005 average exchange rates) mostly on sales of aluminum aerial high-voltage cables, low- and medium-voltage insulated power cables and bimetallic products used in electric transmission and communications. Pro forma results of the ECN Cable acquisition are not material.

The results of operations of the acquired businesses discussed above have been included in the consolidated financial statements since the respective dates of acquisition.

4. Inventories

General Cable values all of its North American inventories and all of its non-North American metal inventories using the last-in first-out (LIFO) method and all remaining inventories using the first-in first-out (FIFO) method. Inventories are stated at the lower of cost or market value. The Company determines whether a lower of cost or market provision is required on a quarterly basis by computing whether inventory on hand, on a LIFO basis, can be sold at a profit based upon current selling prices less variable selling costs. No provision was required in the first six fiscal months of 2007 or 2006. In the event that a provision is required in some future period, the Company will determine the amount of the provision by writing down the value of the inventory to the level of current selling prices less variable selling costs.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

Inventories consisted of the following (in millions):

		June 29,				December 31,
		2007				2006
Raw materials		$	94.0			$	73.6
Work in process			128.9				94.9
Finished goods			410.5				394.6
Total		$	633.4			$	563.1

At June 29, 2007 and December 31, 2006, $453.1 million and $436.7 million, respectively, of inventories were valued using the LIFO method. Approximate replacement costs of inventories valued using the LIFO method totaled $712.5 million at June 29, 2007 and $632.3 million at December 31, 2006.

If in some future period, the Company was not able to recover the LIFO value of its inventory when replacement costs were lower than the LIFO value of the inventory, the Company would be required to take a charge to recognize in its income statement an adjustment of LIFO inventory to market value.

The Company has consignment inventory at certain of its customer locations for purchase and use by the customer or other parties. General Cable retains title to the inventory and records no sale until it is ultimately sold either to the customer storing the inventory or to another party. In general, the value and quantity of the consignment inventory is verified by General Cable through either cycle counting or annual physical inventory counting procedures. At June 29, 2007 and December 31, 2006, the Company had approximately $43.1 million and $33.4 million, respectively, of consignment inventory at locations not operated by the Company with approximately 87% and 79%, respectively, of the consignment inventory being located throughout the United States and Canada.

5. Property, Plant and Equipment

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

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

		June 29,				Dec. 31,
		2007				2006
Land		$	41.1			$	39.1
Buildings and leasehold improvements			84.5				76.0
Machinery, equipment and office furnishings			563.2				518.4
Construction in progress			29.0				19.5
Total — gross book value			717.8				653.0
Less accumulated depreciation			(269.6	)			(236.3	)
Total — net book value		$	448.2			$	416.7

Depreciation expense for the three and six fiscal months ended June 29, 2007 was $11.7 million and $25.6 million, respectively. Depreciation expense for the three and six fiscal months ended June 30, 2006 was $10.8 million and $22.2 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

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

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 and six fiscal months ended June 29, 2007 and June 30, 2006.

6. 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, impairment loss is recognized in the amount equal to the excess. There was no goodwill or significant intangible assets with indefinite lives on the Company’s balance sheet as of June 29, 2007 or December 31, 2006.

Intangible assets that are not deemed to have indefinite lives are amortized over their useful lives. There were no significant amortizable intangible assets on the Company’s balance sheet at June 29, 2007 or December 31, 2006. No significant amortization expense was recognized during the three and six fiscal months ended June 29, 2007 and June 30, 2006 and no significant amortization expense is anticipated to be recognized on current intangible assets in the next five years.

7. Long-Term Debt

Long-term debt consisted of the following (in millions):

		June 29,				December 31,
		2007				2006
9.5% Senior Notes due 2010		$	4.8			$	285.0
7.125% Senior Notes due 2017			200.0				—
Senior Floating Rate Notes			125.0				—
0.875% Convertible Notes			355.0				355.0
Spanish Term Loan			31.9				33.9
Capital leases			3.8				4.3
Other			89.3				62.4
Total debt			809.8				740.6
Less current maturities			434.1				55.5
Long-term debt		$	375.7			$	685.1
Weighted average interest rates on the above outstanding balances were as follows:
9.5% Senior Notes due 2010			9.5	%			9.5	%
7.125% Senior Notes due 2017			7.125	%			—	%
Senior Floating Rate Notes			7.725	%			—	%
0.875% Convertible Notes			0.875	%			0.875	%
Spanish Term Loan			4.6	%			4.6	%
Capital leases			6.5	%			6.5	%
Other			4.0	%			3.8	%

On March 6, 2007, the Company commenced a cash tender offer (the “Offer”) to purchase, at $1,070.72 (per $1,000.00 9.5% Senior Note), any and all of the $285.0 million outstanding aggregate principal amount of the 9.5% Senior Notes that were issued in November 2003, bear interest at a fixed rate of 9.5% and mature in 2010. Also, in conjunction with the Offer, the Company received consent, on March 15, 2007, to effect certain amendments to the indenture governing the 9.5% Senior Notes that eliminated substantially all of the restrictive covenants. As of March 30, 2007, approximately 98% of the 9.5% Senior Notes were tendered, with the Company making total cash payments of approximately $280.0 million for the 9.5% Senior Notes, $9.3 million for accrued interest and $19.8 million for the inducement premium. The Company recognized a pre-tax loss on the extinguishment of debt of approximately $25.1 million, consisting of $20.5 million for the inducement premium and related tender fees and expenses and the write-off of approximately $4.6 million in unamortized fees and expenses. Since March 30, 2007, approximately $0.2 million of additional 9.5% Senior Notes have been purchased by the Company. General Cable Corporation and its U.S. wholly-owned subsidiaries continue to fully and unconditionally guarantee the remaining $4.8 million of 9.5% Senior Notes remaining on June 29, 2007 on a joint and several basis. The estimated fair value of the remaining 9.5% Senior Notes was approximately $5.1 million at June 29, 2007.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

On March 21, 2007, the Company completed the issuance and sale of $325.0 million in aggregate principal amount of new 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”). The Notes are jointly and severally guaranteed by the Company’s U.S. subsidiaries. The Notes were offered and sold in private transactions in accordance with Rule 144A and Regulation S under the Securities Act of 1933, as amended (the “Securities Act”). A tender 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.

The Senior Floating Rate Notes bear interest at an annual rate equal to the 3-month LIBOR rate plus 2.375%. Interest on the Senior Floating Rate Notes is payable quarterly in arrears in cash on January 1, April 1, July 1 and October 1 of each year, commencing on July 1, 2007. The 7.125% Senior Notes bear interest at a rate of 7.125% per year and are payable semi-annually in arrears in cash on April 1 and October 1 of each year, commencing on October 1, 2007. The Senior Floating Rate Notes mature on April 1, 2015 and the 7.125% Senior Notes mature on April 1, 2017.

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 so long as there is no default on the Notes and the Company meets certain financial conditions.

The Company may, at its option, redeem the Senior Floating Rate Notes and 7.125% Senior Notes on or after the following dates and at the following percentages plus accrued and unpaid interest:

Senior Floating Rate Notes				7.125% Senior Notes
Beginning Date		Percentage		Beginning Date		Percentage
April 1, 2009		102.000%		April 1, 2012		103.563%
April 1, 2010		101.000%		April 1, 2013		102.375%
April 1, 2011		100.000%		April 1, 2014		101.188%
				April 1, 2015		100.000%

Proceeds from the Notes were principally used to extinguish approximately 98% of the 9.5% Senior Notes debt under the Offer mentioned previously. Proceeds from the Notes of $325.0 million, less approximately $7.7 million of cash payments for fees and expenses that will be amortized over the life of the Notes, were used to pay approximately $280.2 million for the 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 $7.3 million that will be used for general corporate purposes.

In conjunction with the issuance and sale of the $325.0 million Notes, the Company entered into a Registration Rights Agreement that requires the Company to (i) file a registration statement within 90 days after the issue date of the Notes enabling the holders of the Notes to exchange the Notes for publicly registered notes with identical terms; (ii) use commercially reasonable efforts to have the registration statement declared effective within 210 days after the issue date of the Notes; and (iii) cause the registration statement to become effective within 270 days after the issue date of the Notes. The Company has fulfilled all of the Company’s requirements under the Registration Rights Agreement.

The Company’s current senior secured revolving credit facility (“Amended Credit Facility”), as amended, is a five-year, $300.0 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. Loans under the Amended Credit Facility bear interest at the Company’s option, equal to either an alternate base rate (prime plus 0.00% to 0.50%) or an adjusted LIBOR rate plus an applicable margin percentage (LIBOR plus 1.00% to 1.75%). The applicable margin percentage is subject to adjustments based upon the excess availability, as defined. At June 29, 2007, the Company had no outstanding borrowings, had undrawn availability of $249.2 million under the Amended Credit Facility, and was in compliance with all covenants under the Amended Credit Facility. The Company had outstanding letters of credit related to this Amended Credit Facility of $31.4 million at June 29, 2007.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

Indebtedness under the Amended Credit Facility is guaranteed by the Company’s U.S. subsidiaries and is secured by a first priority security interest in tangible and intangible property and assets of the Company’s U.S. subsidiaries. The lenders have also received a pledge of all of the capital stock of the Company’s existing domestic subsidiaries and any future domestic subsidiaries.

During the first quarter of 2007, the Company further amended the Amended Credit Facility. The amendment permitted the Company to issue senior notes of up to $350.0 million on an unsecured basis, to enter into certain hedging agreements to exchange up to $100.0 million of any fixed rate of interest on the senior notes for a floating rate and extend or replace existing hedging agreements, to effect a cash tender offer to purchase at least a majority of the $285.0 million outstanding aggregate principal balance of the 9.5% Senior Notes, to pay fees and expenses related to the tender offer, and to replenish a basket which would allow the Company to repurchase up to $125.0 million of its outstanding shares of common stock. This basket had previously been used to purchase the note hedges discussed below. No other terms or conditions of the Amended Credit Facility have changed from those terms and conditions disclosed in the Company’s 2006 Annual Report on Form 10-K.

The Company’s 0.875% Convertible Notes were issued in November of 2006 in the amount of $355.0 million, pursuant to the Company’s effective Registration Statement on Form S-3. The 0.875% Convertible Notes bear interest at a fixed rate of 0.875%, payable semi-annually in arrears, and mature in 2013. The 0.875% Convertible Notes are unconditionally guaranteed, jointly and severally, on a senior unsecured basis, by the Company’s wholly-owned U.S. subsidiaries. The estimated fair value of the 0.875% Convertible Notes was approximately $575.8 million at June 29, 2007.

The 0.875% Convertible Notes are convertible at the option of the holder into the Company’s common stock at an initial conversion price of $50.36 per share (approximating 19.856 shares per $1,000 principal amount of the 0.875% Convertible Notes), upon the occurrence of certain events. One of these events, requiring that the closing price of the Company’s common stock is greater than or equal to 130% of the conversion price for at least 20 trading days during the period of 30 consecutive trading days ending on the last trading day of the preceding calendar quarter (establishing a contingent conversion price of $65.47 per share), occurred during the three fiscal months ended June 29, 2007. Therefore, as of June 30, 2007, the 0.875% Convertible Notes became convertible at the option of the holder, and the related debt has been reclassified into “Current portion of long-term debt” on the Consolidated Balance Sheet.

Upon conversion, a holder will receive, in lieu of common stock, an amount of cash equal to the lesser of (i) the principal amount of an 0.875% Convertible Note, or (ii) the conversion value, determined in the manner set forth in the indenture governing the 0.875% Convertible Notes, of a number of shares equal to the conversion rate. If the conversion value exceeds the principal amount of the 0.875% Convertible Note on the conversion date, the Company will also deliver, at the Company’s election, cash or common stock or a combination of cash and common stock with respect to the conversion value upon conversion. If conversion occurs in connection with a “fundamental change” as defined in the 0.875% Convertible Notes indenture, the Company may be required to repurchase the 0.875% Convertible Notes for cash at a price equal to the principal amount plus accrued but unpaid interest. In addition, if conversion occurs in connection with certain changes in control, the Company may be required to deliver additional shares of the Company’s common stock (a “make whole” premium) by increasing the conversion rate with respect to such notes, under this scenario the maximum aggregate number of shares that the Company would be obligated to issue upon conversion of the 0.875% Convertible Notes is 8,987,322. Under almost all other conditions, as disclosed in the 2006 Annual Report on Form 10-K, the Company may be obligated to issue additional shares up to a maximum of 7,048,880 upon conversion in full of the 0.875% Convertible Notes. No terms and conditions of the 0.875% Convertible Notes have changed from those terms and conditions disclosed in the Company’s 2006 Annual Report on Form 10-K.

Pursuant to Emerging Issues Task Force (“EITF”) 90-19, “Convertible Bonds with Issuer Option to Settle for Cash upon Conversion,” EITF 00-19, “Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock” (“EITF 00-19”), and EITF 01-6, “The Meaning of Indexed to a Company’s Own Stock” (“EITF 01-6”), the 0.875% Convertible Notes are accounted for as convertible debt in the accompanying Condensed Consolidated Balance Sheet and the embedded conversion option in the 0.875% Convertible Notes has not been accounted for as a separate derivative. For a discussion of the effects of the 0.875% Convertible Notes and the bond hedges and warrants discussed below on earnings per share, see Note 14.

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%

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

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.

In addition, 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 (European style). 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, pursuant to EITF 00-19 and EITF 01-6, the note hedges and warrants are accounted for as equity transactions. Therefore, the payment associated with the issuance of the note hedges and the proceeds received from the issuance of the warrants were recorded as a charge and an increase, respectively, in additional paid-in capital in shareholders’ equity as separate equity transactions.

For income tax reporting purposes, the Company has elected to integrate the 0.875% Convertible Notes and the note hedges. Integration of the note hedges with the 0.875% Convertible Notes creates an original issue discount (“OID”) debt instrument for income tax reporting purposes. Therefore, the cost of the note hedges will be accounted for as interest expense over the term of the 0.875% Convertible Notes for income tax reporting purposes. The associated income tax benefits that are recognized for financial reporting purposes will be recognized as a reduction in the income tax provision in the periods that the deductions are taken for income tax reporting purposes.

Proceeds from the offering were used to pay down $87.8 million outstanding, 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 approximately $9.4 million in debt issuance costs that are being amortized to interest expense over the term of the 0.875% Convertible Notes. 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.

The Spanish Term Loan of €50 million was issued in December 2005 and was available in up to three tranches, with an interest rate of Euribor plus 0.8% to 1.5% depending on certain debt ratios. Two of the tranches have expired. The remaining tranche of the Spanish Term Loan is repayable in fourteen semi-annual installments, maturing seven years following the draw down. As of June 29, 2007, the U.S. dollar equivalent of $31.9 million was drawn under this term loan facility and no availability remains under the Spanish Term Loan.

The Spanish Credit Facility of €25 million was issued in December 2005, matures at the end of five years and carries an interest rate of Euribor plus 0.6% to 1.0% depending on certain debt ratios. No funds are currently drawn under the Spanish Credit Facility, leaving undrawn availability of approximately the U.S. dollar equivalent of $33.8 million as of June 29, 2007. Commitment fees ranging from 15 to 25 basis points per annum on any unused commitments under the Spanish Credit Facility will be assessed to Grupo General Cable Sistemas, S.A., and are payable on a quarterly basis.

The Spanish facilities are subject to certain financial ratios of the European group, the most restrictive of which is net debt to EBITDA (earnings before interest, taxes, depreciation and amortization). In addition, the indebtedness under the combined facilities is guaranteed by the Company’s Portuguese subsidiary and by Silec Cable, S.A.S.

On August 31, 2006, the Company acquired ECN Cable and assumed the U.S. dollar equivalent of $38.6 million (at prevailing exchange rates during that period) of mostly short-term ECN Cable debt as a part of the acquisition. On December 15, 2006, approximately $6.9 million (at the prevailing exchange rate on that date) of debt was paid and cancelled. As of June 29, 2007, ECN Cable’s debt was the U.S. dollar equivalent of $38.2 million. The debt consisted of approximately $5.5 million relating to an uncommitted accounts receivable facility, approximately $8.0 million under open debt lines that charge interest at

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

Euribor plus 0.5% and had additional availability of approximately $6.9 million at June 29, 2007, and approximately $24.7 million of short-term financing agreements at various interest rates.

At June 29, 2007, maturities of long-term debt during twelve month periods beginning June 30, 2007 through June 30, 2012 are $434.1 million, $14.9 million, $6.9 million, $11.2 million and $5.8 million, respectively, and $336.9 million thereafter.

8. Derivative and Other Financial Instruments

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

Cash Flow Hedges

General Cable has utilized interest rate swaps to manage its interest expense exposure by fixing its interest rate on a portion of the Company’s floating rate debt. Under the swap agreements, General Cable typically paid a fixed rate while the counterparty paid to General Cable the difference between the fixed rate and the three-month LIBOR rate. During 2001, the Company entered into several interest rate swaps which effectively fixed interest rates for borrowings under a former credit facility and other debt. At June 29, 2007, the remaining outstanding interest rate swap had a notional value of $9.0 million, an interest rate of 4.49% and matures 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 as defined in SFAS No. 133, are based on quoted market prices and third party provided calculations, which reflect the present values of the difference between estimated future variable-rate receipts and future fixed-rate payments. At June 29, 2007 and December 31, 2006, the net unrealized loss on the interest rate derivative and the related carrying value was $(0.3) million and $(0.4) million, respectively.

Outside of North America, General Cable enters into commodity futures contracts, which are designated as and qualify as cash flow hedges as defined in SFAS No. 133, for the purchase of copper, aluminum and lead for delivery in a future month to match certain sales transactions. At June 29, 2007 and December 31, 2006, General Cable had an unrealized gain (loss) of $9.6 million and $(10.8) million, respectively, on the commodity futures.

The Company enters into forward exchange contracts, which are designated as and qualify as cash flow hedges as defined in SFAS No. 133, 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. At June 29, 2007 and December 31, 2006, the net unrealized loss on the net foreign currency contracts was $(9.9) million and $(5.6) million, respectively.

Interest rate swaps are used to manage interest expense exposure by fixing the interest rate on a portion of floating rate debt. Commodity and foreign currency contracts are used to hedge future sales and purchase commitments. Unrealized gains and losses on these derivative financial instruments are recorded in other comprehensive income (loss) until the underlying transaction occurs and is recorded in the statement of operations at which point such amounts included in other comprehensive income (loss) are recognized in income, which generally will occur over periods of less than one year. During the three and six fiscal months ended June 29, 2007, a $2.7 million gain and a $(0.1) million loss, respectively, was reclassified from accumulated other comprehensive income to the statement of operations. During the three and six fiscal months ended June 30, 2006, a $2.6 million gain and a $5.5 million gain, respectively, were reclassified from accumulated other comprehensive income to the statement of operations.

Net Investment Hedge

In October 2005, the Company entered into a U.S. dollar to Euro cross currency and interest rate swap agreement with a notional value of $150 million, which is designated as and qualifies as a net investment hedge of the Company’s net investment in its European operations, in order to hedge the effects of the changes in spot exchange rates on the value of the

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

net investment. The swap has a term of just over two years with a maturity date of November 15, 2007. The fair value of the cross currency and interest rate swap is determined with the assistance of third party provided calculations. At June 29, 2007 and December 31, 2006, the net unrealized loss on the swap was $19.5 million and $15.2 million, respectively. The swap is marked-to-market quarterly using the “spot method” to measure the amount of hedge ineffectiveness. Changes in the fair value of the swap as they relate to spot exchange rates are recorded as other comprehensive income (loss) whereas changes in the fair value of the swap as they relate to the interest rate differential and the change in interest rate differential since the last marked-to-market date, equaling approximately $(0.7) million and $(0.3) million, respectively, as of June 29, 2007 and December 31, 2006, are recognized currently in earnings for the period. The unrealized gains and losses recognized in other comprehensive income (loss) will be recorded in the statement of operations at a future point in time if the Company divests of its European operations.

Fair Value of Designated Derivatives

The notional amounts and fair values of these designated cash flow and net investment hedge financial instruments at June 29, 2007 and December 31, 2006 are shown below (in millions). The carrying amount of the financial instruments was a net liability of $(19.2) million and $(31.1) million at June 29, 2007 and December 31, 2006, respectively.

		June 29, 2007								December 31, 2006
		Notional				Fair				Notional				Fair
		Amount				Value				Amount				Value
Cash flow hedges:
Interest rate swap		$	9.0			$	(0.3	)		$	9.0			$	(0.4	)
Commodity futures			165.4				9.6				217.6				(10.8	)
Foreign currency forward exchange			312.4				(9.9	)			152.0				(5.6	)
Net investment hedges:
Cross currency and interest rate swap			150.0				(18.6	)			150.0				(14.3	)
						$	(19.2	)						$	(31.1	)

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 of SFAS No. 133 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 June 29, 2007 and December 31, 2006, General Cable had $150.1 million and $165.4 million, respectively, of future copper and aluminum purchases that were under forward pricing agreements. At June 29, 2007 and December 31, 2006, the fair value of these arrangements were $158.9 million and $155.3 million, respectively, and General Cable had an unrealized gain (loss) of $8.8 million and $(10.1) million, respectively, related to these transactions. General Cable expects the unrealized losses, if any, under these agreements to be offset as a result of firm sales price commitments with customers.

9. Income Taxes

On January 1, 2007, the Company adopted Financial Accounting Standards Board Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (FIN 48). FIN 48 prescribes a recognition threshold that a tax position is required to meet before being recognized in the financial statements and provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition issues.

In connection with the January 1, 2007 adoption of FIN 48, the Company recognized an $18.8 million decrease in opening retained earnings. As of January 1, 2007, the Company had total unrecognized tax benefits of $45.6 million, of which $37.2 million would have a favorable impact on the effective tax rate if recognized. For the first six months of 2007, $2.6 million of additional unrecognized tax benefits have been accrued for tax positions likely to be taken for the current year, all of which would have a favorable impact on the effective tax rate if recognized. It is reasonably possible that approximately $1.1 million of unrecognized tax benefits related to multi-state tax positions could change within the next twelve months due to the expiration of the statute of limitations or tax audit settlements.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

The Company previously classified interest related to income tax liabilities as interest expense in the condensed consolidated statement of operations. Penalties, which have historically been insignificant, were classified as income tax expense. In accordance with paragraph 19 of FIN 48, the Company has elected to classify interest and penalties as a component of income tax expense. As of January 1, 2007, the Company had accrued approximately $1.5 million of tax-related interest and penalties.

The Company files income tax returns in the United States and numerous foreign, state and local tax jurisdictions. Tax years that are open for examination and assessment by the Internal Revenue Service are 2003 through 2006. With limited exceptions, tax years prior to 2002 are no longer open in major foreign, state or local tax jurisdictions.

10. 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 non-U.S. defined benefit pension plans include plans that provide pension benefits and retirement indemnities to employees within the Company’s European business. The Company’s pension obligation was increased $41.9 million due to the NSW acquisition on April 30, 2007, see Note 3. Pension obligations for the majority of non-qualified unfunded defined benefit pension plans are provided for by recorded reserves and are based on local practices and regulations of the respective countries. General Cable makes cash contributions for the costs of the non-qualified unfunded defined benefit pension plans as the benefits are paid.

On June 27, 2007, the Board of Directors of the Company approved amendments to the General Cable Supplemental Executive Retirement Plan (“SERP”) and the General Cable Corporation Deferred Compensation Plan (“DCP”) and the merger of the SERP into the DCP. The Company received written acknowledgement and acceptance of the SERP amendments and merger from each participant in the SERP. The amendments and merger were made in order to simplify, limit and better align these specific compensation plans with the Company’s compensation policies, which were described in the Company’s 2007 Proxy Statement filed with the Securities and Exchange Commission on March 28, 2007.

The amendments and merger (i) provided to each active SERP participant an enhanced benefit which reflected an additional period of credited service through December 31, 2008, and each participant’s estimated 2007 and 2008 base and bonus compensation, (ii) froze the accrual of benefits under the SERP following the addition of the enhanced benefit, (iii) converted the SERP from a non-account balance plan into an account balance plan by replacing the accrued benefit of a participant with a benefit based on the value of an account balance, being credited initially by the present value of the participant’s unvested enhanced benefit in the SERP, (iv) required the participants to make an election with regard to time and form of payment of the amounts credited to the account balance which became effective as of June 27, 2007, and (v) transferred all account balances and all account liabilities under the amended SERP to the DCP to be governed by the provisions of the DCP, including, but not limited to, those relating to the time and form of benefit payment, investment recommendations and vesting. Each participant’s account balance was funded by the Company with contributions to the Company’s Rabbi Trust as part of the DCP, as amended.

As a result of the amendments and merger and based on the guidance provided in SFAS No. 88, Employer’s Accounting for Settlements and Curtailments of Defined Benefit Pension Plans and for Termination Benefits, a curtailment loss of approximately $3.2 million and a settlement gain of approximately $4.3 million were recognized during the three fiscal months ended June 29, 2007 for a net gain of approximately $1.1 million.

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
		June 29, 2007								June 30, 2006
		U.S. Plans				Non-U.S Plans				U.S. Plans				Non-U.S. Plans
Service cost		$	0.5			$	0.2			$	0.6			$	0.2
Interest cost			2.1				0.5				2.3				0.4
Expected return on plan assets			(2.6	)			(0.5	)			(2.4	)			(0.4	)
Amortization of prior service cost			0.3				—				0.3				—
Amortization of net loss			0.4				0.2				0.7				0.1
Curtailment loss			3.2				—				—				—
Settlement gain			(4.3	)			—				—				—
Net pension expense (gain)		$	(0.4	)		$	0.4			$	1.5			$	0.3

		Six Fiscal Months Ended
		June 29, 2007								June 30, 2006
		U.S. Plans				Non-U.S Plans				U.S. Plans				Non-U.S. Plans
Service cost		$	1.0			$	0.4			$	1.0			$	0.5
Interest cost			4.3				1.0				4.5				0.8
Expected return on plan assets			(5.2	)			(0.9	)			(4.8	)			(0.8	)
Amortization of prior service cost			0.6				—				0.6				0.1
Amortization of net loss			0.9				0.3				1.4				0.1
Curtailment loss			3.2				—				—				—
Settlement gain			(4.3	)			—				—				—
Net pension expense		$	0.5			$	0.8			$	2.7			$	0.7

Defined benefit pension plan cash contributions for the three and six fiscal months ended June 29, 2007 were $1.3 million and $2.4 million, respectively. Defined benefit pension plan cash contributions for the three and six fiscal months ended June 30, 2006 were $1.3 million and $2.3 million, respectively.

Postretirement Benefits Other Than Pensions

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

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

		Three Fiscal Months Ended								Six Fiscal Months Ended
		June 29,				June 30,				June 29,				June 30,
		2007				2006				2007				2006
Service cost		$	—			$	—			$	0.1			$	0.1
Interest cost			0.1				0.2				0.2				0.3
Net amortization and deferral			0.1				0.1				0.1				0.1
Net postretirement benefit expense		$	0.2			$	0.3			$	0.4			$	0.5

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 and six fiscal months ended June 29, 2007 was $1.9 million and $4.5 million, respectively. The net defined contribution plan expense recognized for the three and six fiscal months ended June 30, 2006 was $1.9 million and $4.2 million, respectively.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

11. Shareholders’ Equity

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

The Company maintains a deferred compensation plan (“DCP”). This plan is available to directors and certain officers and managers of the Company. The plan allows participants to defer all or a portion of their directors’ fees and/or salary and annual bonuses, as applicable, and it permits participants to elect to contribute and defer all or any portion of their nonvested stock, restricted stock and stock awards. All deferrals to the participants’ accounts vest immediately; Company contributions vest according to the vesting schedules in the qualified plan and nonvested stock and restricted stock vests according to the schedule designated by the award. The Company makes matching and retirement contributions (currently equal to 6%) of compensation paid over the maximum allowed for qualified pension benefits, whether or not the employee elects to defer any compensation. The DCP does not have dollar limits on tax-deferred contributions. During the second quarter of 2007, the Company made approximately $7.1 million in one-time contributions to the DCP as a part of the merger of the SERP with the DCP. For more details on the merger, see Note 10.

The assets of the DCP are held in a Rabbi Trust (“Trust”) and, therefore, are available to satisfy the claims of the Company’s creditors in the event of bankruptcy or insolvency of the Company. Participants have the right to request that their account balance be determined by reference to specified investment alternatives (with the exception of the portion of the account which consists of deferred nonvested and subsequently vested stock and restricted stock). With certain exceptions, these investment alternatives are the same alternatives offered to participants in the General Cable Retirement and Savings Plan for Salaried Associates. In addition, participants have the right to request that the Plan Administrator re-allocate the deferral among available investment alternatives; provided, however that the Plan Administrator is not required to honor such requests. Distributions from the plan are generally made upon the participants’ termination as a director and/or employee, as applicable, of the Company. Participants receive payments from the plan in cash, either as a lump sum payment or through equal annual installments from between one and ten years, except for the nonvested and subsequently vested stock and restricted stock, which the participants receive in shares of General Cable stock. The Company accounts for the DCP in accordance with EITF 97-14, “Accounting for Deferred Compensation Arrangements Where Amounts Earned are Held in a Rabbi Trust and Invested.”

Assets of the Trust, other than the nonvested and subsequently vested stock and restricted stock of the Company, are invested in funds covering a variety of securities and investment strategies, including a General Cable Stock Fund (“GCSF”). Mutual funds available to participants are publicly quoted and reported at market value. The Company accounts for these investments as available for sale in accordance with SFAS No. 115, Accounting for Certain Investments in Debt and Equity Securities. The Company accounts for investments in the GCSF as treasury stock.

The Trust also holds nonvested and subsequently vested stock and restricted stock shares of the Company. The Company’s nonvested and subsequently vested stock and restricted stock that is held by the Trust has been accounted for in additional paid-in capital since the adoption of SFAS 123(R) on January 1, 2006, and prior to that date, had been accounted for in other shareholders’ equity in the consolidated balance sheet. The market value of this nonvested and subsequently vested stock and restricted stock was $52.0 million as of June 29, 2007 and $30.5 million as of December 31, 2006. The market value of investment in the GCSF, accounted for in treasury stock, was $3.3 million as of June 29, 2007 and was insignificant as of December 31, 2006. The market value of the assets held by the Trust, exclusive of the market value of the GCSF and the shares of the Company’s nonvested and subsequently vested stock and restricted stock, was $17.0 million as of June 29, 2007 and $12.3 million as of December 31, 2006, and was classified as “other non-current assets” in the consolidated balance sheet. Amounts payable to the plan participants as of June 29, 2007, excluding the market value of the shares of the Company’s nonvested and subsequently vested stock and restricted stock, was $20.3 million as of June 29, 2007 and $12.3 million as of December 31, 2006, and was classified as “other liabilities” in the consolidated balance sheet.

In accordance with EITF 97-14, all market value fluctuations of the Trust assets, exclusive of the shares of nonvested and subsequently vested stock and restricted stock of the Company, have been reflected in other comprehensive income (loss). Increases or decreases in the market value of the deferred compensation liability, excluding the shares of nonvested and subsequently vested stock and restricted stock of the Company held by the Trust, are included in compensation expense in the consolidated statement of operations. Based on the changes in the total market value of the Trust’s assets, exclusive of the nonvested and subsequently vested stock and restricted stock, the Company recorded net compensation expense of $1.5 million and $0.6 million, respectively, for the three fiscal months ended June 29, 2007 and June 30, 2006 and $2.2 million for the six fiscal months ended June 29, 2007 and June 30, 2006.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

The components of accumulated other comprehensive income (loss) consisted of the following (in millions):

		June 29,				December 31,
		2007				2006
Foreign currency translation adjustment		$	59.9			$	44.8
Pension adjustments, net of tax			(27.0	)			(27.0	)
Change in fair value of derivatives, net of tax			(13.9	)			(20.2	)
Unrealized investment gains, net of tax			8.3				6.4
Adoption of SFAS 158, net of tax			(7.0	)			(7.0	)
Other			1.4				0.4
Total		$	21.7			$	(2.6	)

Comprehensive income is as follows (in millions):

		Three Fiscal Months Ended								Six Fiscal Months Ended
		June 29,				June 30,				June 29,				June 30,
		2007				2006				2007				2006
Net income		$	62.9			$	41.5			$	100.8			$	62.9
Currency translation gain			13.5				12.2				15.1				12.0
Change in fair value of derivatives, net of tax			(4.1	)			1.2				6.3				4.1
Unrealized investment gain, net of tax			1.2				0.6				1.9				2.2
Comprehensive net income		$	73.5			$	55.5			$	124.1			$	81.2

12. Share-Based Compensation

General Cable has various plans which provide for granting options and common stock to certain employees and independent directors of the Company and its subsidiaries. On January 1, 2006, the Company adopted Statement of Financial Accounting Standards No. 123 (Revised 2004), “Share-Based Payment” (“SFAS 123(R)”). Therefore, the Company recognizes compensation expense for share-based payments based on the fair value of the awards at the grant date.

The adoption of SFAS 123(R)’s fair value method lowered pre-tax income by $0.9 million and $0.5 million, respectively, lowered net income by $0.5 million and $0.3 million, respectively, and lowered basic and diluted earnings per share by $0.01 per share for the three fiscal months ended June 29, 2007 and June 30, 2006, giving effect to the recognition of the Company’s compensation cost from stock options as estimated using the Black-Scholes valuation model. Pre-tax income was lowered by $1.1 million and $0.7 million, respectively, net income was lowered by $0.7 million and $0.5 million, respectively, and basic and diluted earnings per share was lowered by $0.01 and $0.01, respectively, for the six fiscal months ended June 29, 2007 and June 30, 2006. In addition, the Company continued to record compensation expense related to nonvested stock awards as a component of selling, general and administrative expense. The three and six fiscal months ended June 29, 2007 included $0.2 million and $0.3 million, respectively, of compensation costs related to performance-based nonvested stock awards (as compared to $0.6 million and $0.9 million, respectively, for the three and six fiscal months ended June 30, 2006) and $1.6 million and $2.2 million, respectively, related to all other nonvested stock awards (as compared to $1.3 million and $1.6 million, respectively, for the three and six fiscal months ended June 30, 2006). For the three fiscal months ended June 29, 2007 and June 30, 2006, all share-based compensation costs lowered pre-tax earnings by $2.7 million and $2.4 million, respectively, lowered net income by $1.6 million and $1.5 million, respectively, and lowered basic and diluted earnings per share by $0.03 per share and $0.03 per share, respectively. For the six fiscal months ended June 29, 2007 and June 30, 2006, all share-based compensation costs lowered pre-tax earnings by $3.6 million and $3.3 million, respectively, lowered net income by $2.2 million and $2.1 million, respectively, and lowered basic and diluted earnings per share by $0.04 per share and $0.04 per share, respectively.

The Company also recognized approximately $6.2 million and $5.1 million, respectively, of excess tax benefits on share-based compensation for the three fiscal months ended June 29, 2007 and June 30, 2006 and approximately $9.3 million and $8.4 million, respectively, for the six fiscal months ended June 29, 2007 and June 30, 2006 in its Condensed Consolidated Statements of Cash Flows as financing cash inflows that would have been classified as operating cash inflows prior to the adoption of SFAS 123(R). The Company has elected the alternative method, as discussed in SFAS 123(R)-3, to calculate the pool of excess tax benefits available to absorb tax deficiencies recognized subsequent to the adoption of SFAS 123(R).

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

No material changes in financial condition and results of operations have occurred from share-based compensation between the current period and the prior comparative periods. Additional information regarding share-based compensation and the Company’s share-based compensation plans are available in the Company’s 2006 Annual Report on Form 10-K as filed on March 1, 2007.

13. 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 storage and handling of shipments to customers are included in cost of sales and totaled $28.9 million and $26.9 million, respectively, for the three fiscal months ended June 29, 2007 and June 30, 2006 and $55.2 million and $54.4 million, respectively, for the six fiscal months ended June 29, 2007 and June 30, 2006.

14. Earnings Per Common Share

A reconciliation of the numerator and denominator of earnings per common share — basic to earnings per common share — assuming dilution is as follows (in millions, except per share data):

		Three Fiscal Months Ended								Six Fiscal Months Ended
		June 29,				June 30,				June 29,				June 30,
		2007				2006				2007				2006
Earnings per common share — basic:
Net income		$	62.9			$	41.5			$	100.8			$	62.9
Less: preferred stock dividends			(0.1	)			(0.1	)			(0.2	)			(0.2	)
Net income for basic EPS computation (1)		$	62.8			$	41.4			$	100.6			$	62.7
Weighted average shares outstanding for basic EPS computation (2)			51.2				50.8				51.1				50.4
Earnings per common share — basic		$	1.23			$	0.81			$	1.97			$	1.24
Earnings per common share — assuming dilution:
Net income		$	62.9			$	41.5			$	100.8			$	62.9
Less: preferred stock dividends, if applicable			—				—				—				—
Net income for diluted EPS computation(1)		$	62.9			$	41.5			$	100.8			$	62.9
Weighted average shares outstanding including nonvested shares			52.3				50.8				52.2				50.4
Dilutive effect of stock options and restricted stock units			0.4				0.9				0.4				0.9
Dilutive effect of convertible notes			1.5				—				0.7				—
Dilutive effect of assumed conversion of preferred stock			0.5				0.5				0.5				0.5
Weighted average shares outstanding for diluted EPS computation(2)			54.7				52.2				53.8				51.8
Earnings per common share — assuming dilution		$	1.15			$	0.80			$	1.87			$	1.21

Under EITF 04-8, “The Effect of Contingently Convertible Instruments on Diluted Earnings Per Share”, and EITF 90-19, and because of the Company’s obligation to settle the par value of the 0.875% Convertible Notes in cash, the Company is not required to include any shares underlying the 0.875% Convertible Notes in its weighted average shares outstanding – assuming dilution until the average stock price per share for the quarter exceeds the $50.36 conversion price of the 0.875% Convertible Notes 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 converted. These conditions had occurred as of June 29, 2007. The average stock price for the quarter was approximately $64.35 per share and was $56.43 for the six fiscal months ending June 29, 2007. Therefore, approximately 1.5 million shares and 0.7 million shares, respectively, were included in the weighted average shares outstanding – assuming dilution as of June 29, 2007. Shares underlying the warrants discussed in Note 7 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, per the guidance in SFAS 128, Earnings per Share, will not be included in the weighted average

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

shares outstanding – assuming dilution because the impact of the shares will always be anti-dilutive. The condition to include underlying shares related to the warrants had not been met as of June 29, 2007.

The following table provides examples of how changes in the Company’s stock price will effect the inclusion of shares in the denominator of the weighted average shares outstanding – assuming dilution calculation. 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 discussed below:

														Total Treasury								Incremental Shares
														Method				Shares Due to the				Issued by the
		Share				Shares Underlying 0.875%				Warrant				Incremental				Company under				Company upon
		Price				Convertible 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

15. Segment Information

General Cable has thirteen operating segments and eight reportable operating segments: North American Electric Utility, International Electric Utility, North American Portable Power and Control, North American Electrical Infrastructure, International Electrical Infrastructure, Transportation and Industrial Harnesses, Telecommunications and Networking. These segments are strategic business units organized around product categories, and secondarily around geographic considerations, that follow management’s internal organization structure.

North American Electric Utility cable products include low-, medium- and high-voltage power distribution and power transmission products and installation for overhead and buried applications. International Electric Utility cable products include low-, medium-, high- and extra-high-voltage power distribution and power transmission products and installation for overhead and buried applications. North American Portable Power and Control cable products include electronic signal, control, sound and security cables, and flexible cords used for temporary power, OEM applications and maintenance and repair. North American Electrical Infrastructure cable products include low- and medium-voltage industrial instrumentation, power and control cables used for power generation, refining and petrochemical applications, natural gas production, factory automation and non-residential industrial construction. International Electrical Infrastructure cable products include maintenance cords and cables, flexible construction cables, and industrial instrumentation, power and control cables used for power generation, mining, refining and petrochemical applications, natural gas production, factory automation and non-residential, industrial and residential construction. Transportation and Industrial Harnesses cable products include automotive wire and cable and application-specific wire harnesses and assemblies. Telecommunications wire and cable products include low-voltage outside plant wire and cable products for aerial, buried and duct applications. Networking products include submarine fiber optic cables and low-voltage network, fiber optic and other information technology cables.

Statement of Financial Accounting Standards No. 131, Disclosures about Segments of an Enterprise and Related Information (SFAS 131), establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information of those segments to be presented in interim financial statements. Operating segments are identified as components of an enterprise for which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions on how to allocate resources and assess performance. Under the criteria of SFAS 131, the Company has thirteen operating segments and eight reportable segments. The following table summarizes the relationship between the Company’s operating segments and reportable segments:

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

Operating Segments		Reportable Segments
North American Utility		North American Electric Utility
European Utility		International Electric Utility
Asia-Pacific Utility		International Electric Utility
Portable Cord & Electronics		North American Portable Power and Control
Industrial Products		North American Electrical Infrastructure
European Industrial & Specialty Cables		International Electrical Infrastructure
Asia-Pacific Industrial & Specialty Cables		International Electrical Infrastructure
Automotive Products		Transportation and Industrial Harnesses
Assemblies		Transportation and Industrial Harnesses
Telecommunications		Telecommunications
Datacom Products		Networking
European Communications		Networking
Asia-Pacific Communications		Networking

The Automotive Products and Assemblies operating segments have been aggregated into the Transportation and Industrial Harnesses reporting segment and the Datacom Products, European Communications, and Asia-Pacific Communications operating segments have been aggregated into the Networking reporting segment based on paragraphs 18, 20 and 21 of SFAS 131 that allow the aggregation of operating segments that do not meet certain quantitative thresholds. The Asia-Pacific Utility and the Asia-Pacific Industrial & Specialty Cables segments have been aggregated with the European Utility and European Industrial & Specialty Cables segments, respectively, based on the overall immateriality of the Asia-Pacific operating segments compared to the consolidated amounts of the reportable segments into which they are aggregated.

Segment net sales represent sales to external customers. Segment operating income (loss), used in management’s evaluation of segment performance, represents income before interest income, interest expense, other income (expense), loss on extinguishment of debt or income taxes. Corporate assets included cash, deferred income taxes, certain property, including property held for sale, prepaid expenses and other current and non-current assets. The accounting policies of the operating segments have not changed from those described in the Company’s 2006 Annual Report on Form 10-K.

Summarized financial information for the Company’s reportable segments for the three fiscal months and six fiscal months ended June 29, 2007 and June 30, 2006 and as of June 29, 2007 and December 31, 2006 is as follows (in millions).

		Three Fiscal Months Ended
		June 29, 2007				June 30, 2006
Net sales:
North American Electric Utility		$	228.3			$	216.2
International Electric Utility			213.9				143.3
North American Portable Power and Control			93.0				85.6
North American Electrical Infrastructure			107.8				82.7
International Electrical Infrastructure			295.0				244.2
Transportation and Industrial Harnesses			39.1				30.6
Telecommunications			86.7				100.3
Networking			108.7				84.2
Total net sales		$	1,172.5			$	987.1

		Three Fiscal Months Ended
		June 29, 2007				June 30, 2006
Operating income:
North American Electric Utility		$	24.3			$	14.1
International Electric Utility			21.8				11.1
North American Portable Power and Control			5.1				6.4
North American Electrical Infrastructure			10.6				3.4
International Electrical Infrastructure			22.4				17.1
Transportation and Industrial Harnesses			6.2				3.9
Telecommunications			7.2				12.5
Networking			5.4				1.9
Total operating income		$	103.0			$	70.4

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

		Six Fiscal Months Ended
		June 29, 2007				June 30, 2006
Net sales:
North American Electric Utility		$	444.4			$	388.8
International Electric Utility			402.2				270.8
North American Portable Power and Control			168.7				150.6
North American Electrical Infrastructure			196.0				156.0
International Electrical Infrastructure			538.7				431.4
Transportation and Industrial Harnesses			70.8				59.3
Telecommunications			166.0				186.3
Networking			194.9				148.2
Total net sales		$	2,181.7			$	1,791.4

		Six Fiscal Months Ended
		June 29, 2007				June 30, 2006
Operating income(loss):
North American Electric Utility		$	47.4			$	20.3
International Electric Utility			39.6				23.4
North American Portable Power and Control			10.9				10.5
North American Electrical Infrastructure			18.2				4.6
International Electrical Infrastructure			46.2				27.9
Transportation and Industrial Harnesses			10.3				7.7
Telecommunications			10.3				18.5
Networking			11.2				(0.3	)
Total operating income		$	194.1			$	112.6

		As of
		June 29, 2007				Dec. 31, 2006
Identifiable assets:
North American Electric Utility		$	262.2			$	214.7
International Electric Utility			564.4				436.5
North American Portable Power and Control			149.9				125.4
North American Electrical Infrastructure			142.7				106.3
International Electrical Infrastructure			653.1				505.0
Transportation and Industrial Harnesses			68.8				55.1
Telecommunications			166.5				147.1
Networking			269.5				218.5
Corporate			402.6				410.1
Total assets		$	2,679.7			$	2,218.7

16. Commitments and Contingencies

Certain present and former operating sites, or portions thereof, currently or previously owned or leased by current or former operating units of General Cable are the subject of investigations, monitoring or remediation under the United States Federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA or Superfund), the Federal Resource Conservation and Recovery Act or comparable state statutes or agreements with third parties. These proceedings are in various stages ranging from initial investigations to active settlement negotiations to implementation of the cleanup or remediation of sites.

Certain present and former operating units of General Cable in the United States have been named as potentially responsible parties (PRPs) at several off-site disposal sites under CERCLA or comparable state statutes in federal court proceedings. In each of these matters, the operating unit of General Cable is working with the governmental agencies involved and other PRPs to address environmental claims in a responsible and appropriate manner.

At June 29, 2007 and December 31, 2006, General Cable had an accrued liability of approximately $1.8 million and $1.9 million, respectively, for various environmental-related liabilities of which General Cable is aware. American Premier Underwriters Inc., a former parent of General Cable, agreed to indemnify General Cable against all environmental-related liabilities arising out of General Cable’s or its predecessors’ ownership or operation of the Indiana Steel & Wire Company and Marathon Manufacturing Holdings, Inc. businesses (which were divested by General Cable), without limitation as to time or

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

amount. While it is difficult to estimate future environmental-related liabilities accurately, General Cable does not currently anticipate any material adverse impact on its results of operations, financial position or cash flows as a result of compliance with federal, state, local or foreign environmental laws or regulations or cleanup costs of the sites discussed above.

As part of the acquisition of the worldwide energy cable and cable systems business of BICC plc, BICC plc agreed to indemnify General Cable against environmental liabilities existing at the date of the closing of the purchase of the business. The indemnity is for an eight-year period ending in 2007 while General Cable operates the businesses subject to certain sharing of losses (with BICC plc covering 95% of losses in the first three years, 80% in years four and five and 60% in the remaining three years). The indemnity is also subject to the overall indemnity limit of $150 million, which applies to all warranty and indemnity claims in the transaction. In addition, BICC plc assumed responsibility for cleanup of certain specific conditions at several sites operated by General Cable and cleanup is mostly complete at those sites. In the sale of the European businesses to Pirelli in August 2000, the Company generally indemnified Pirelli against any environmental-related liabilities on the same basis as BICC plc indemnified the Company in the earlier acquisition. However, the indemnity the Company received from BICC plc related to the European businesses sold to Pirelli terminated upon the sale of those businesses to Pirelli. At this time, there are no claims outstanding under the general indemnity provided by BICC plc. In addition, the Company generally indemnified Pirelli against other claims relating to the prior operation of the business. Pirelli has asserted claims under this indemnification. The Company is continuing to investigate these claims and believes that the reserves currently included in the Company’s balance sheet are adequate to cover any obligation it may have.

General Cable has also agreed to indemnify Southwire Company against certain environmental liabilities arising out of the operation of the business it sold to Southwire prior to its sale. The indemnity is for a ten year period from the closing of the sale, which ends in the fourth quarter of 2011, and is subject to an overall limit of $20 million. At this time, there are no claims outstanding under this indemnity.

In addition, Company subsidiaries have been named as defendants in lawsuits alleging exposure to asbestos in products manufactured by the Company. At June 29, 2007, there were approximately 1,415 non-maritime claims and 33,390 maritime asbestos claims outstanding. At June 29, 2007 and December 31, 2006, General Cable had accrued, on a gross basis, approximately $5.5 million and $5.2 million, respectively, and had recorded approximately $0.5 million of insurance recoveries for these lawsuits.

The Company does not believe that the outcome of the litigation will have a material adverse effect on its results of operations, financial position or cash flows.

General Cable is also involved in various routine legal proceedings and administrative actions. Such proceedings and actions should not, individually or in the aggregate, have a material adverse effect on its result of operations, cash flows or financial position.

The Company’s principal U.S. operating subsidiary has unconditionally guaranteed the payments required to be made to the parties involved in the cross currency and interest rate swap that the Company entered into in 2005. The guarantee continues until the commitment under the swap has been paid in full, including principal plus interest, with the final amount due in November 2007. The maximum exposure under this guarantee was approximately $175.9 million as of June 29, 2007, and the net exposure position was an unfavorable $18.8 million. As of June 29, 2007, no significant liability was recorded on the Company’s condensed consolidated balance sheet for this guarantee.

The Company had outstanding letters of credit related to its Amended Credit Facility of approximately $31.4 million as of June 29, 2007 and December 31, 2006. These letters of credit are primarily renewed on an annual basis, and the majority of the amount relates to risks associated with an outstanding industrial revenue bond, with self insurance claims and with defined benefit plan obligations. The Company also had approximately $63.4 million in letters of credit related to Silec to cover risks associated with performance on some of its contracts as of June 29, 2007.

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

17. Supplemental Guarantor Information

General Cable Corporation and its material U.S. wholly-owned subsidiaries fully and unconditionally guarantee the remaining $4.8 million of the 9.5% Senior Notes due 2010, the $200.0 million of 7.125% Senior Notes due 2017, the $125.0 million of Senior Floating Rate Notes due 2015, and the 0.875% Convertible Notes due 2013 of General Cable Corporation (the Issuer) on a joint and several basis. The following presents financial information about the Issuer, guarantor subsidiaries and non-guarantor subsidiaries in millions. All of the Company’s subsidiaries are “restricted subsidiaries” for purposes of the debt instruments. Intercompany transactions are eliminated.

Condensed Statements of Operations
Three Fiscal Months Ended June 29, 2007

										Non-
						Guarantor				Guarantor
		Issuer				Subsidiaries				Subsidiaries				Eliminations				Total
Net sales:
Customers		$	—			$	501.4			$	671.1			$	—			$	1,172.5
Intercompany			14.2				—				—				(14.2	)			—
			14.2				501.4				671.1				(14.2	)			1,172.5
Cost of sales			—				416.6				582.8				—				999.4
Gross profit			14.2				84.8				88.3				(14.2	)			173.1
Selling, general and administrative expenses			11.7				36.9				35.7				(14.2	)			70.1
Operating income			2.5				47.9				52.6				—				103.0
Other income (expense)			—				0.2				(1.7	)			—				(1.5	)
Interest income (expense):
Interest expense			(8.6	)			(15.5	)			(3.3	)			16.8				(10.6	)
Interest income			18.4				0.3				2.0				(16.8	)			3.9
			9.8				(15.2	)			(1.3	)			—				(6.7	)
Income before income taxes			12.3				32.9				49.6				—				94.8
Income tax provision			(4.5	)			(10.3	)			(17.1	)			—				(31.9	)
Equity in net income of subsidiaries			55.1				32.5				—				(87.6	)			—
Net income			62.9				55.1				32.5				(87.6	)			62.9
Less: preferred stock dividends			(0.1	)			—				—				—				(0.1	)
Net income applicable to common shareholders		$	62.8			$	55.1			$	32.5			$	(87.6	)		$	62.8

GENERAL CABLE CORPORATION AND SUBSIDIARIES

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

Condensed Statements of Operations
Six Fiscal Months Ended June 29, 2007

										Non-
						Guarantor				Guarantor
		Issuer				Subsidiaries				Subsidiaries				Eliminations				Total
Net sales:
Customers		$	—			$	944.8			$	1,236.9			$	—			$	2,181.7
Intercompany			22.6				—				—				(22.6	)			—
			22.6				944.8				1,236.9				(22.6	)			2,181.7
Cost of sales			—				789.5				1,059.3				—				1,848.8
Gross profit			22.6				155.3				177.6				(22.6	)			332.9
Selling, general and administrative expenses			23.1				63.5				74.8				(22.6	)			138.8
Operating income (loss)			(0.5	)			91.8				102.8				—				194.1
Other income (expense)			—				—				(1.5	)			—				(1.5	)
Interest income (expense):
Interest expense			(15.6	)			(33.7	)			(5.9	)			35.7				(19.5	)
Interest income			38.7				0.6				3.3				(35.7	)			6.9
Loss on extinguishment of debt			(25.1	)			—				—				—				(25.1	)
			(2.0	)			(33.1	)			(2.6	)			—				(37.7	)
Income (loss) before income taxes			(2.5	)			58.7				98.7				—				154.9
Income tax (provision) benefit			0.9				(21.4	)			(33.6	)			—				(54.1	)
Equity in net income of subsidiaries			102.4				65.1				—				(167.5	)			—
Net income			100.8				102.4				65.1				(167.5	)			100.8
Less: preferred stock dividends			(0.2	)			—				—				—				(0.2	)
Net income applicable to common shareholders		$	100.6			$	102.4			$	65.1			$	(167.5	)		$	100.6