Coleman Cable, Inc. Announces Third-Quarter 2009 Financial Results


WAUKEGAN, Ill., Nov. 5, 2009 (GLOBE NEWSWIRE) -- Coleman Cable, Inc. (Nasdaq:CCIX) (the "Company," "Coleman," "we," "us," or "our"), a leading manufacturer and innovator of electrical and electronic wire and cable products, announced third-quarter 2009 financial results.



 * Adjusted earnings per share (Adjusted EPS) of $0.08 per diluted share
 * Adjusted Earnings Before Interest, Taxes, Depreciation and
   Amortization (Adjusted EBITDA) of $13.5 million
 * Net income of $0.8 million, or $0.05 per diluted share
 * Sales of $133.8 million

Management Comments

"We are pleased to report Adjusted EPS of $0.08 and Adjusted EBITDA of $13.5 million for the third quarter, which represents the third consecutive quarter of sequential improvement," said Gary Yetman, president and CEO. "Our improved profitability on a sequential basis reflects in part the positive effect of recent cost reductions and capacity adjustments, the benefits of the seasonal uptick and increased demand levels within our Distribution segment, as well as the positive impact on profitability of our customer rationalization within our OEM segment."

Mr. Yetman added, "While still significantly below 2008 levels, we are also encouraged by continued stability in our volumes, which, measured in total pounds shipped, increased 10.5 percent on a sequential basis from the second quarter of 2009. We continue to believe that the improvements we have made in our business during the past year have us well positioned to benefit as the U.S. economy rebounds." Mr. Yetman concluded, "Our outlook remains cautious, however, as we believe economic conditions will remain challenging in the near term, and our results are likely to continue to be impacted by pricing pressures resulting from excess industry capacity and weak overall demand. These issues may be more prevalent in the fourth quarter where, relative to other quarters, industry-wide demand levels have historically been lower. Additionally, our visibility of when we may experience a sustained period of volume growth remains limited. Factoring in a continuation of the demand trends seen in the third quarter, stability in copper prices, and higher revenue from our recently introduced industrial cable products, we expect fourth-quarter 2009 Adjusted EBITDA to be between $11.0 million and $14.0 million and Adjusted EPS to be between $0.01 and $0.10 per diluted share."

Third-Quarter Financial Results Summary

For the third quarter of 2009, Coleman generated net income of $0.8 million, or $0.05 per diluted share, as compared to net income of $1.7 million, or $0.10 per diluted share, for the same period of 2008. The 2009 results include $1.7 million, or $(0.07) per diluted share, of restructuring charges, primarily lease and other holding costs related to facilities closed in 2008 and 2009, as well as expenses incurred relative to the closure of our East Longmeadow, Mass., manufacturing facility in May 2009, and our Oswego, New York, facility during the third quarter of 2009. Additionally, our third-quarter 2009 results included $0.3 million, or $(0.01) per diluted share, of asset impairment charges related to a property that is currently being held for sale. The Company's third-quarter 2009 results also included $0.7 million, or $0.03 per diluted share, related to the favorable impact of foreign currency exchange rates on our Canadian subsidiary, and a pre-tax gain of $0.4 million, or $0.02 per diluted share, on the repurchase of $2.2 million in par value of the Company's 9.875 percent Senior Notes at a discount to their par value. For the third quarter of 2008, net income included restructuring costs of $2.5 million, or $(0.09) per diluted share, primarily attributable to the integration of the Company's 2007 acquisitions, and $1.6 million, or $(0.06) per diluted share, for a reserve established for an insurance claim we filed related to thefts at a since-closed facility.

Excluding the above-noted items, the decline in third-quarter 2009 earnings versus the same quarter last year primarily reflects lower overall sales demand. Coleman reported net sales of $133.8 million for the third quarter of 2009 compared to net sales of $270.7 million in the same period last year, a decrease of 50.6 percent. Volume (total pounds shipped) decreased 41.3 percent in the third quarter of 2009 compared to the same prior-year period. These declines reflect a significant contraction in demand across the Company's business in the face of recessionary conditions, as well as the planned downsizing of Coleman's OEM segment. The negative impact of lower sales demand on net income was partially offset by a significant improvement in the Company's gross profit margin, reflecting in part a temporary margin expansion brought about by a relatively rapid rise in copper prices during the latter part of the third quarter of 2009 as well as improved gross margin within our OEM segment, lower selling, engineering, general and administrative expense, a decrease in intangible amortization expense, and reduced interest expense as a result of lower outstanding debt levels.

The Company's total debt (net of cash) was reduced by $101.3 million from $327.8 million at September 30, 2008, to $226.5 million at September 30, 2009.

Non-GAAP Results

In an effort to better assist investors in understanding Coleman's financial results, as part of this release, we also provide Adjusted Net Income, Adjusted EPS, and Adjusted EBITDA, all of which are measures not defined under accounting principles generally accepted in the United States (GAAP). Management believes these numbers are useful to investors in understanding the results of operations because they illustrate the impact that interest, taxes, depreciation, amortization, and other non-recurring and/or non-cash charges had on results. These terms are used in this release as they are calculated in the financial information set forth below.

Webcast

Coleman Cable has scheduled its conference call for Friday, November 6, 2009, at 10:00 a.m. Central time. Hosting the call will be Gary Yetman, president and CEO, and Richard Burger, executive vice president and CFO. A live broadcast of the Company's conference call, along with accompanying visuals, will be available on-line through the Company's Web site at http://investors.colemancable.com/events.cfm. The webcast will be archived for 90 days.

About Coleman Cable, Inc.

Coleman Cable, Inc. is a leading manufacturer and innovator of electrical and electronic wire and cable products for the security, sound, telecommunications, electrical, commercial, industrial, and automotive industries. With extensive design and production capabilities and a long-standing dedication to customer service, Coleman Cable, Inc. is the preferred choice of cable and wire users throughout the United States.

The Coleman Cable, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6583

Various statements included in this release, including those that express a belief, expectation or intention, as well as those that are not statements of historical fact constitute forward-looking statements. These statements may be identified by the use of forward-looking terminology such as "believes," "plans," "anticipates," "expects," "estimates," "continues," "could," "may," "might," "potential," "predict," "should," or the negative thereof or other variations thereon or comparable terminology. In particular, statements about Coleman Cable's expectations, beliefs, plans, objectives, assumptions or future events, financial results or performance contained in this release are forward-looking statements. Coleman Cable has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While Coleman Cable believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors, including those discussed in Coleman Cable's most recent Annual Report on Form 10-K (available at www.sec.gov), may cause its actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Some of the key factors that could cause actual results to differ from Coleman Cable's expectations include:



 * fluctuations in the supply or price of copper and other raw
   materials;
 * increased competition from other wire and cable manufacturers,
   including foreign manufacturers;
 * pricing pressures causing margins to decrease;
 * further adverse changes in general economic and capital market
   conditions;
 * changes in the demand for Coleman Cable's products by key
   customers;
 * additional impairment charges related to our goodwill and
   long-lived assets;
 * failure to identify, finance or integrate acquisitions;
 * failure to accomplish integration activities on a timely basis;
 * failure to achieve expected efficiencies in Coleman Cable's
   manufacturing and integration activities;
 * changes in the cost of labor or raw materials, including PVC
   and fuel costs;
 * failure of customers to make expected purchases, including
   customers of acquired companies;
 * unforeseen developments or expenses with respect to Coleman
   Cable's business acquisition, integration and consolidation
   efforts; and
 * other risks and uncertainties, including those described under
   "Item 1A. Risk Factors" in Coleman Cable's most recent Annual
   Report on Form 10-K.

In addition, any forward-looking statements represent Coleman's views only as of today and should not be relied upon as representing its views as of any subsequent date. While Coleman may elect to update forward-looking statements at some point in the future, it specifically disclaims any obligation to do so, even if its estimates change and, therefore, you should not rely on these forward-looking statements as representing Coleman's views as of any date subsequent to today.

CCIX-G



                 COLEMAN CABLE, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                  (Thousands, except per share date)
                              (unaudited)


                               Three months ended   Nine months ended
                                  September 30,       September 30,
                               ------------------  ------------------
                                 2009      2008      2009      2008
                               --------  --------  --------  --------
 NET SALES                     $133,795  $270,712  $364,049  $790,775
 COST OF GOODS SOLD             113,475   240,814   310,171   703,736
                               --------  --------  --------  --------
 GROSS PROFIT                    20,320    29,898    53,878    87,039
 SELLING, ENGINEERING,
  GENERAL AND
  ADMINISTRATIVE EXPENSES         9,916    14,228    30,408    40,472
 
 ASSET IMPAIRMENTS                  300        --    69,798        --
 INTANGIBLE ASSET
  AMORTIZATION                    2,071     3,121     6,773     8,889
 RESTRUCTURING CHARGES            1,692     2,504     4,049     5,515
                               --------  --------  --------  --------
 OPERATING INCOME (LOSS)          6,341    10,045   (57,150)   32,163
 INTEREST EXPENSE                 6,242     7,211    19,014    22,545
 GAIN ON REPURCHASE OF
  SENIOR NOTES                     (385)       --    (3,285)       --
 OTHER (INCOME) LOSS, NET          (674)      (56)   (1,068)       68
                               --------  --------  --------  --------
 INCOME (LOSS) BEFORE
  INCOME TAXES                    1,158     2,890   (71,811)    9,550
 INCOME TAX EXPENSE (BENEFIT)       374     1,153    (8,125)    3,716
                               --------  --------  --------  --------
 NET INCOME (LOSS)             $    784  $  1,737  $(63,686) $  5,834
                               ========  ========  ========  ========
 EARNINGS (LOSS) PER COMMON
  SHARE DATA
    NET INCOME (LOSS)
     PER SHARE
      Basic                    $   0.05  $   0.10  $  (3.79) $   0.35
      Diluted                      0.05      0.10     (3.79)     0.35
    WEIGHTED AVERAGE COMMON
     SHARES OUTSTANDING
      Basic                      16,809    16,787    16,809    16,787
      Diluted                    17,180    16,825    16,809    16,811


                 COLEMAN CABLE, INC. AND SUBSIDIARIES
                           Non-GAAP Results
                              (Thousands)

                     Q3 2008   Q4 2008   Q1 2009   Q2 2009   Q3 2009
                    --------  --------  --------  --------  --------
                                     Adjusted Results
                    ------------------------------------------------
 Income (loss)
  before income
  taxes, as
  reported          $  2,890  $(51,520) $(73,640) $    670  $  1,158
 Asset impairments        --    29,276    69,498        --       300
 Restructuring
  charges              2,504     4,710       657     1,700     1,692
 Gain on
  repurchase of
  debt                    --        --        --    (2,900)     (385)
 Currency
  translations,
  net                    (67)    2,218       339      (732)     (675)
 Inventory theft
  insurance
  receivable
  allowance            1,588        --        --        --        --
                    --------  --------  --------  --------  --------
 Income before
  income taxes,
  adjusted             6,915   (15,316)   (3,146)   (1,262)    2,090
 Income tax
  expense
  (benefit),
  adjusted             2,759    (5,180)     (379)     (697)      675
                    --------  --------  --------  --------  --------
 Adjusted net
  income (loss)     $  4,156  $(10,136) $ (2,767) $   (565) $  1,415
                    ========  ========  ========  ========  ========
 Adjusted earnings
  per share data
 Adjusted net
  income (loss)
  per common share
 Basic              $   0.25  $  (0.60) $  (0.16) $  (0.03) $   0.08
 Diluted            $   0.25  $  (0.60) $  (0.16) $  (0.03) $   0.08
 Weighted average
  common shares
  outstanding
 Basic                16,787    16,787    16,787    16,809    16,809
 Diluted              16,825    16,787    16,800    17,195    17,180

 EBITDA               17,395   (36,999)  (61,140)   12,354    12,557
 Asset impairments        --    29,276    69,498        --       300
 Restructuring
  charges              2,504     4,710       657     1,700     1,692
 Gain on
  repurchase of
  debt                    --        --        --    (2,900)     (385)
 Currency
  translations,
  net                    (67)    2,218       339      (732)     (675)
 Inventory theft
  insurance
  receivable
  allowance            1,588        --        --        --        --
                    --------  --------  --------  --------  --------
 Adjusted EBITDA    $ 21,420  $   (795) $  9,354  $ 10,422  $ 13,489
                    ========  ========  ========  ========  ========
   % of net sales        7.9%    -0.4%       8.0%      9.2%     10.1%

 Adjusted earnings
  per share data
 Adjusted net
  income (loss)
  per common share
 Diluted EPS        $   0.10  $  (2.03) $  (3.86) $   0.02  $   0.05
 Asset impairments        --      1.15      3.64        --      0.01
 Restructuring
  charges               0.09      0.19      0.03      0.04      0.07
 Gain on
  repurchase
  of debt                 --        --        --     (0.08)    (0.02)
 Currency
  translations,
  net                  (0.00)     0.09      0.02     (0.02)    (0.03)
 Inventory theft
  insurance
  receivable
  allowance             0.06        --        --        --        --
                    --------  --------  --------  --------  --------
 Diluted Adjusted
  EPS               $   0.25  $  (0.60) $  (0.16) $  (0.03) $   0.08
                    ========  ========  ========  ========  ========

     Reconciliation of Fourth Quarter 2009 Earnings Target to GAAP For
     the fourth quarter of 2009, the Company is currently targeting
     diluted Adjusted EPS to be in the range of $0.01 to $0.10 per
     share. On a GAAP basis, the Company is currently targeting
     diluted EPS to be in the range of ($0.10) to $0.10 per share.

     Adjusted EPS is Net Income calculated on a diluted EPS basis
     excluding restructuring costs, gain on debt repurchases and
     foreign currency gains and losses recorded at our Canadian
     subsidiary.

   * Rounding differences may occur for various calculated amounts.


                 COLEMAN CABLE, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED BALANCE SHEETS
                              (Thousands)

                                                 Sept. 30,   Dec. 31,
                                                   2009       2008
                                                 ---------  ---------
 ASSETS
 CURRENT ASSETS:
    Cash and cash equivalents                    $   6,085  $  16,328
    Accounts receivable, less allowance for
     uncollectible accounts of $2,618 and
     $3,020, respectively                           83,554     97,038
    Inventories                                     73,642     73,368
    Deferred income taxes                            3,575      4,202
    Assets held for sale                             4,582      3,535
    Prepaid expenses and other current assets        6,528     10,688
                                                 ---------  ---------
      Total current assets                         177,966    205,159
                                                 ---------  ---------
 PROPERTY, PLANT AND EQUIPMENT, NET                 52,733     61,443
 GOODWILL                                           29,014     98,354
 INTANGIBLE ASSETS                                  32,633     39,385
 OTHER ASSETS                                        9,047      7,625
                                                 ---------  ---------
 TOTAL ASSETS                                    $ 301,393  $ 411,966
                                                 =========  =========
 LIABILITIES AND SHAREHOLDERS' EQUITY
 CURRENT LIABILITIES:
    Current portion of long-term debt            $      33  $  30,445
    Accounts payable                                27,001     27,408
    Accrued liabilities                             29,952     31,191
                                                 ---------  ---------
      Total current liabilities                     56,986     89,044
                                                 ---------  ---------
 LONG-TERM DEBT                                    232,600    242,369
 OTHER LONG-TERM LIABILITIES                         3,653      4,046
 DEFERRED INCOME TAXES                                   0      7,088
 SHAREHOLDERS' EQUITY:
    Common stock, par value $0.001;
     75,000 authorized; 17,180 and
     16,787 issued and outstanding
     on September 30, 2009 and
     December 31, 2008                                  17         17
    Additional paid-in capital                      88,030     86,135
    Accumulated deficit                            (79,654)   (15,968)
    Accumulated other comprehensive loss              (239)      (765)
                                                 ---------  ---------
      Total shareholders' equity                     8,154     69,419
                                                 ---------  ---------
 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY      $ 301,393  $ 411,966
                                                 =========  =========


            

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