General Cable Corp. (BGC), Monday reported a decline in third-quarter profit as increased expenses more than offset growth in revenues. The power transmission cable maker's quarterly earnings missed Street estimates, as did sales. The company also provided a weak revenue outlook for the fourth quarter which is indicated to miss current Street estimates. Following the news, BGC shares lost more than 13 percent in after hours trade on the New York Stock Exchange.
For the third quarter, General Cable's net income to common shares dropped to $3.6 million or $0.07 per share from $18 million or $0.34 per share last year.
Results for the quarter include $0.10 per share of non-cash convertible debt interest expense and $0.16 per share of derivative-related losses.
Excluding items, adjusted net income for the quarter was $0.33 per share, compared to $0.54 per share in the prior year.
On average, seven analysts polled by Thomson Reuters expected earnings of $0.72 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales for the quarter grew 14 percent to $1.52 billion from $1.2 billion a year earlier. Seven Wall Street analysts on consensus expected revenues of $1.61 billion for the quarter.
Before the impact of favorable foreign currency exchange, sales for the quarter increased 10 percent.
CEO Gregory Kenny, said, "Our third quarter results reflect continuing weak conditions in Europe and the impact of significant currency volatility and rapid commodity deflation in the latter portion of the quarter. In ROW, results were generally consistent with expectations through the first couple months of the quarter."
During the quarter, volume based on metal pounds sold increased 6 percent, compared to last year, partly as a result of increased aluminum based product shipments for metal intensive, aerial transmission projects in Brazil.
The company, in accordance with the terms of its 5.75 percent Series A Convertible Redeemable Preferred Stock, declared a quarterly preferred stock dividend of about $0.72 per share, payable on November 28 to preferred stockholders of record on October 31.
Looking ahead to the fourth quarter, the company has forecast revenues of $1.40 billion to $1.45 billion, while the Street currently expect revenues of $1.56 billion.
Given the extreme metal price volatility, the company said it has broadened its fourth quarter operating income range to $38 to $50 million.
General Cable said fourth quarter results will be "burdened by the impact of selling higher average cost inventory into a lower and volatile metal price environment."
BGC closed Monday's regular trade at $28.04, down $1.99 or 6.63%, on a volume of 1 million shares. In after hours, the stock lost 13.34%.
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