##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2009
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from            to
 Commission File Number 001-33337
 COLEMAN CABLE, INC.
  Delaware
    
    36-4410887(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 1530 Shields Drive, Waukegan, Illinois 60085
 (847) 672-2300
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




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##### 



INDEX
 PagePART I. FINANCIAL INFORMATIONItem 1. Financial Statements (unaudited)
    
    3Condensed Consolidated Statements of Operations for the three months ended March 31, 2009 and 2008
    
    3Condensed Consolidated Balance Sheets as of March 31, 2009 and December 31, 2008
    
    4Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2009 and 2008
    
    5Notes to Condensed Consolidated Financial Statements
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    21Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    28Item 4. Controls and Procedures
    
    28PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    29Item 5. Other Information
    
    29Item 6. Exhibits
    
    30Signatures
    
    31Exhibit Index
    
    32EX-10.1EX-10.2EX-31.1EX-31.2EX-32.1
  2




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PART I.
 
 ITEM 1. Financial Statements
 COLEMAN CABLE, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (Thousands, except per share data)
 (unaudited)
 Three months ended March 31,2009
    
    
    2008NET SALES
    
    $
    117,322
    
    
    $
    252,483COST OF GOODS SOLD
    
    
    100,774
    
    
    
    223,634GROSS PROFIT
    
    
    16,548
    
    
    
    28,849SELLING, ENGINEERING, GENERAL AND ADMINISTRATIVE EXPENSES
    
    
    10,659
    
    
    
    12,761INTANGIBLE ASSET AMORTIZATION
    
    
    2,630
    
    
    
    2,662ASSET IMPAIRMENTS
    
    
    69,498
    
    
    
    RESTRUCTURING CHARGES
    
    
    657
    
    
    
    176OPERATING INCOME (LOSS)
    
    
    (66,896
    )
    
    
    13,250INTEREST EXPENSE
    
    
    6,405
    
    
    
    7,804OTHER LOSS, NET
    
    
    339
    
    
    
    121INCOME (LOSS) BEFORE INCOME TAXES
    
    
    (73,640
    )
    
    
    5,325INCOME TAX EXPENSE (BENEFIT)
    
    
    (8,870
    )
    
    
    2,067NET INCOME (LOSS)
    
    $
    (64,770
    )
    
    $
    3,258EARNINGS (LOSS) PER COMMON SHARE DATANET INCOME (LOSS) PER SHAREBasic
    
    $
    (3.85
    )
    
    $
    0.19Diluted
    
    
    (3.85
    )
    
    
    0.19WEIGHTED AVERAGE COMMON SHARES OUTSTANDINGBasic
    
    
    16,807
    
    
    
    16,787Diluted
    
    
    16,807
    
    
    
    16,800
  3




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COLEMAN CABLE, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (Thousands, except per share data)
 (unaudited)
 March 31,
    
    
    December 31,2009
    
    
    2008ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    23,946
    
    
    $
    16,328Accounts receivable, less allowance for
uncollectible accounts of $2,763 and $3,020,
respectively
    
    
    71,099
    
    
    
    97,038Inventories
    
    
    61,173
    
    
    
    73,368Deferred income taxes
    
    
    3,699
    
    
    
    4,202Assets held for sale
    
    
    3,535
    
    
    
    3,535Prepaid expenses and other current assets
    
    
    8,136
    
    
    
    10,688Total current assets
    
    
    171,588
    
    
    
    205,159PROPERTY, PLANT AND EQUIPMENT, NET
    
    
    59,155
    
    
    
    61,443GOODWILL
    
    
    28,829
    
    
    
    98,354INTANGIBLE ASSETS
    
    
    36,751
    
    
    
    39,385OTHER ASSETS
    
    
    10,284
    
    
    
    7,625TOTAL ASSETS
    
    $
    306,607
    
    
    $
    411,966LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIES:Current portion of long-term debt
    
    $
    305
    
    
    $
    30,445Accounts payable
    
    
    22,880
    
    
    
    27,408Accrued liabilities
    
    
    32,249
    
    
    
    31,191Total current liabilities
    
    
    55,434
    
    
    
    89,044LONG-TERM DEBT
    
    
    242,209
    
    
    
    242,369OTHER LONG-TERM LIABILITIES
    
    
    3,721
    
    
    
    4,046DEFERRED INCOME TAXES
    
    
    
    
    
    
    7,088SHAREHOLDERS EQUITY:Common stock, par value $0.001; 75,000
authorized; 17,180 and 16,787 issued and
outstanding on March 31, 2009 and December
31, 2008
    
    
    17
    
    
    
    17Additional paid-in capital
    
    
    86,653
    
    
    
    86,135Accumulated deficit
    
    
    (80,738
    )
    
    
    (15,968
    )Accumulated other comprehensive loss
    
    
    (689
    )
    
    
    (765
    )Total shareholders equity
    
    
    5,243
    
    
    
    69,419TOTAL LIABILITIES AND SHAREHOLDERS EQUITY
    
    $
    306,607
    
    
    $
    411,966
  4




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COLEMAN CABLE, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Thousands)
 (unaudited)
 Three months ended March 31,2009
    
    
    2008CASH FLOW FROM OPERATING ACTIVITIES:Net income (loss)
    
    $
    (64,770
    )
    
    $
    3,258Adjustments to reconcile net income (loss) to net cash flow from operating activities:Depreciation and amortization
    
    
    6,416
    
    
    
    7,149Stock-based compensation
    
    
    518
    
    
    
    603Foreign currency transaction loss
    
    
    339
    
    
    
    Asset impairments
    
    
    69,498Deferred taxes
    
    
    (9,795
    )
    
    
    (263
    )Loss on disposal of fixed assets
    
    
    
    
    
    
    68Changes in operating assets and liabilities:Accounts receivable
    
    
    25,767
    
    
    
    12,053Inventories
    
    
    11,976
    
    
    
    (8,728
    )Prepaid expenses and other assets
    
    
    2,882
    
    
    
    (1,147
    )Accounts payable
    
    
    (4,496
    )
    
    
    (11,528
    )Accrued liabilities
    
    
    521
    
    
    
    (4,997
    )Net cash flow from operating activities
    
    
    38,856
    
    
    
    (3,532
    )CASH FLOW FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    (1,191
    )
    
    
    (4,350
    )Acquisition of businesses, net of cash acquired
    
    
    
    
    
    
    16Proceeds from sale of fixed assets
    
    
    6
    
    
    
    13Net cash flow from investing activities
    
    
    (1,185
    )
    
    
    (4,321
    )CASH FLOW FROM FINANCING ACTIVITIES:Net borrowings (repayments) under revolving loan facilities
    
    
    (30,000
    )
    
    
    3,047Repayment of long-term debt
    
    
    (144
    )
    
    
    (224
    )Net cash flow from financing activities
    
    
    (30,144
    )
    
    
    2,823Effect of exchange rate changes on cash and cash equivalents
    
    
    91
    
    
    
    53INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    
    
    7,618
    
    
    
    (4,977
    )CASH AND CASH EQUIVALENTS  Beginning of period
    
    
    16,328
    
    
    
    8,877CASH AND CASH EQUIVALENTS  End of period
    
    $
    23,946
    
    
    $
    3,900NONCASH ACTIVITYUnpaid capital expenditures
    
    
    124
    
    
    
    1,312Capital lease obligation
    
    
    
    
    
    
    104SUPPLEMENTAL CASH FLOW INFORMATIONIncome taxes paid (refunded)
    
    
    (2,101
    )
    
    
    936Cash interest paid
    
    
    241
    
    
    
    1,818
  5




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COLEMAN CABLE, INC. AND SUBSIDIARIES
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 (Thousands, except per share data)
 (unaudited)
 1. BASIS OF PRESENTATION
  2. NEW ACCOUNTING PRONOUNCEMENTS
 Business Combinations
 Fair Value Measurements.
 Noncontrolling Interests in Consolidated
Financial Statements  an amendment of ARB No. 51
 Disclosures about Derivative Instruments and
Hedging Activitiesan Amendment of FASB Statement No. 133
 3. ASSET IMPAIRMENTS
   6




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4. RESTRUCTURING AND INTEGRATION ACTIVITIES
  EmployeeSeveranceand
    
    
    Lease
    
    
    Equipment
    
    
    OtherRelocation
    
    
    Termination
    
    
    Relocation
    
    
    ClosingCosts
    
    
    Costs
    
    
    Costs
    
    
    Costs
    
    
    TotalBALANCE  December 31, 2008
    
    $
    25
    
    
    $
    4,967
    
    
    $
    
    
    
    $
    24
    
    
    $
    5,016Provision
    
    
    321
    
    
    
    74
    
    
    
    26
    
    
    
    236
    
    
    
    657Cash payments
    
    
    (222
    )
    
    
    (699
    )
    
    
    (26
    )
    
    
    (242
    )
    
    
    (1,189
    )BALANCE  March 31, 2009
    
    $
    124
    
    
    $
    4,342
    
    
    $
    
    
    
    $
    18
    
    
    $
    4,484
  5. INVENTORIES
  March 31,
    
    
    December 31,2009
    
    
    2008FIFO cost:Raw materials
    
    $
    14,178
    
    
    $
    14,628Work in progress
    
    
    2,396
    
    
    
    2,038Finished products
    
    
    44,599
    
    
    
    56,702Total
    
    $
    61,173
    
    
    $
    73,368
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6. ACCRUED LIABILITIES
  March 31,
    
    
    December 31,2009
    
    
    2008Salaries, wages and employee benefits
    
    $
    3,178
    
    
    $
    3,289Sales incentives
    
    
    5,813
    
    
    
    10,416Interest
    
    
    11,850
    
    
    
    5,988Other
    
    
    11,408
    
    
    
    11,498Total
    
    $
    32,249
    
    
    $
    31,191
 8




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7. DEBT
 March 31,
    
    
    December 31,2009
    
    
    2008Revolving credit facility expiring April 2012
    
    $
    
    
    
    $
    30,0009.875% Senior notes due October 2012,
including unamortized premium of $2,195
 and $2,352, respectively
    
    
    242,195
    
    
    
    242,352Capital lease obligations
    
    
    319
    
    
    
    462Other long-term debt
    
    
    
    
    
    
    242,514
    
    
    
    272,814Less current portion
    
    
    (305
    )
    
    
    (30,445
    )Long-term debt
    
    $
    242,209
    
    
    $
    242,369
 Revolving Credit Facility
      9.875% Senior Notes
  9




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8. EARNINGS PER SHARE
  Three Months Ended March 31,2009
    
    2008Basic weighted average shares outstanding
    
    
    16,807
    
    
    
    16,787Dilutive effect of share-based awards
    
    
    
    
    
    
    13Diluted weighted average share outstanding
    
    
    16,807
    
    
    
    16,800
  9. SHAREHOLDERS EQUITY
 Stock-Based Compensation
  Stock Options
  10




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Weighted-AverageWeighted-Average
    
    
    Remaining
    
    
    AggregateExercise
    
    
    Contractual
    
    
    IntrinsicShares
    
    
    Price
    
    
    Terms
    
    
    ValueOutstanding January 1, 2009
    
    
    1,029
    
    
    $
    14.12
    
    
    
    8.1
    
    
    
    Granted
    
    
    290
    
    
    
    3.99
    
    
    
    9.8
    
    
    
    Exercised
    
    
    
    
    
    
    Forfeited or expired
    
    
    (7
    )
    
    
    13.74Outstanding March 31, 2009
    
    
    1,312
    
    
    $
    11.88
    
    
    
    8.3
    
    
    
    Vested or expected to vest
    
    
    1,241
    
    
    $
    12.00
    
    
    
    
    
    
    
    Exercisable
    
    
    
    
    
    
    
  Stock Awards
   Weighted-AverageGrant -DateShares
    
    Fair ValueNonvested at January 1, 2009
    
    
    67
    
    
    $
    8.41Granted
    
    
    326
    
    
    $
    3.99Vested
    
    
    (22
    )Forfeited
    
    
    Nonvested at March 31, 2009
    
    
    371
    
    
    $
    4.52
 Comprehensive Income
 Three Months Ended March 31,2009
    
    
    2008Net income (loss)
    
    $
    (64,770
    )
    
    $
    3,258Other comprehensive income:Currency translation adjustment, net of tax
    
    
    (138
    )
    
    
    (68
    )Derivative gains, net of tax
    
    
    214
    
    
    
    Total comprehensive income (loss)
    
    $
    (64,694
    )
    
    $
    3,190
  10. RELATED PARTIES
  11




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11. COMMITMENTS AND CONTINGENCIES
 Operating Leases
  Legal Matters
    12. DERIVATIVES
    At March 31, 2009Fair ValueAssets
    
    LiabilitiesDerivatives accounted for as hedges under SFAS No. 133Copper
commodity contracts accounted for as cash flow hedges
    
    $
    127
    
    
    $
    
 12




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At March 31, 2009Fair ValueAssets
    
    LiabilitiesDerivatives not accounted for as hedges under SFAS
No. 133Copper commodity contracts
    
    $
    
    
    
    $
    403
  Three months ended March 31, 2009
 Location of GainGain Recognized in OCI
    
    Gain Recognized in OCI
    
    Recognized in IncomeDerivatives in SFAS No. 133 cash flow hedging relationships
    
    (Effective Portion)
    
    (Ineffective Portion)
    
    (Ineffective portion)Copper commodity contracts
    
    $355
    
    $1
    
    Cost of goods sold
  Three months ended March 31, 2009
 Loss Recognized in
    
    Location of LossDerivatives in not accounted for as
hedges under SFAS No. 133
    
    Income
    
    Recognized in IncomeCopper commodity contracts
    
    $
    608
    
    
    Cost of goods sold
 13. INCOME TAXES
 Three Months Ended March 31,2009
    
    
    2008Effective Tax Rate
    
    
    (12.0%)
    
    
    
    38.8%
  14. BUSINESS SEGMENT INFORMATION
   Three months ended March 31,2009
    
    
    2008Net Sales:Distribution Segment
    
    $
    90,100
    
    
    $
    164,627OEM Segment
    
    
    27,222
    
    
    
    87,856Total
    
    $
    117,322
    
    
    $
    252,483Operating Income(Loss):Distribution Segment
    
    $
    7,575
    
    
    $
    16,290OEM Segment
    
    
    493
    
    
    
    2,734Total segments
    
    
    8,068
    
    
    
    19,024Corporate
    
    
    (74,964
    )
    
    
    (5,774
    )Consolidated operating income (loss)
    
    $
    (66,896
    )
    
    $
    13,250
   13




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15. SUPPLEMENTAL GUARANTOR INFORMATION
  14




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COLEMAN CABLE, INC. AND SUBSIDIARIES  CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2009
 Guarantor
    
    
    Non GuarantorParent
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    TotalNET SALES
    
    $
    110,477
    
    
    $
    
    
    
    $
    6,845
    
    
    $
    
    
    
    $
    117,322COST OF GOODS SOLD
    
    
    95,750
    
    
    
    
    
    
    
    5,024
    
    
    
    
    
    
    
    100,774GROSS PROFIT
    
    
    14,727
    
    
    
    
    
    
    
    1,821
    
    
    
    
    
    
    
    16,548SELLING, ENGINEERING,
GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    9,700
    
    
    
    (7
    )
    
    
    966
    
    
    
    
    
    
    
    10,659INTANGIBLE AMORTIZATION
    
    
    2,599
    
    
    
    
    
    
    
    31
    
    
    
    
    
    
    
    2,630IMPAIRMENT CHARGES
    
    
    69,498
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    69,498RESTRUCTURING CHARGES
    
    
    609
    
    
    
    
    
    
    
    48
    
    
    
    
    
    
    
    657OPERATING
INCOME (LOSS)
    
    
    (67,679
    )
    
    
    7
    
    
    
    776
    
    
    
    
    
    
    
    (66,896
    )INTEREST EXPENSE, NET
    
    
    6,309
    
    
    
    
    
    
    
    96
    
    
    
    
    
    
    
    6,405OTHER LOSS, NET
    
    
    
    
    
    
    
    
    
    
    339
    
    
    
    
    
    
    
    339INCOME
(LOSS) BEFORE INCOME TAXES
    
    
    (73,988
    )
    
    
    7
    
    
    
    341
    
    
    
    
    
    
    
    (73,640
    )INCOME
(LOSS)  FROM SUBSIDIARIES
    
    
    244
    
    
    
    
    
    
    
    
    
    
    
    (244
    )
    
    
    INCOME TAX
EXPENSE (BENEFIT)
    
    
    (8,974
    )
    
    
    
    
    
    
    104
    
    
    
    
    
    
    
    (8,870
    )NET
INCOME (LOSS)
    
    $
    (64,770
    )
    
    $
    7
    
    
    $
    237
    
    
    $
    (244
    )
    
    $
    (64,770
    )
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COLEMAN CABLE, INC. AND SUBSIDIARIES  CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2008
 Guarantor
    
    
    Non GuarantorParent
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    TotalNET SALES
    
    $
    243,516
    
    
    $
    
    
    
    $
    8,967
    
    
    $
    
    
    
    $
    252,483COST OF GOODS SOLD
    
    
    217,699
    
    
    
    
    
    
    
    5,935
    
    
    
    
    
    
    
    223,634GROSS PROFIT
    
    
    25,817
    
    
    
    
    
    
    
    3,032
    
    
    
    
    
    
    
    28,849SELLING, ENGINEERING,
GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    11,709
    
    
    
    
    
    
    
    1,052
    
    
    
    
    
    
    
    12,761INTANGIBLE AMORTIZATION
    
    
    2,629
    
    
    
    
    
    
    
    33
    
    
    
    
    
    
    
    2,662RESTRUCTURING CHARGES
    
    
    176
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    176OPERATING
INCOME
    
    
    11,303
    
    
    
    
    
    
    
    1,947
    
    
    
    
    
    
    
    13,250INTEREST EXPENSE, NET
    
    
    7,743
    
    
    
    
    
    
    
    61
    
    
    
    
    
    
    
    7,804OTHER LOSS, NET
    
    
    12
    
    
    
    
    
    
    
    109
    
    
    
    
    
    
    
    121INCOME
(LOSS) BEFORE INCOME TAXES
    
    
    3,548
    
    
    
    
    
    
    
    1,777
    
    
    
    
    
    
    
    5,325INCOME
(LOSS)  FROM SUBSIDIARIES
    
    
    1,777
    
    
    
    
    
    
    
    
    
    
    
    (1,777
    )
    
    
    INCOME TAX
EXPENSE
    
    
    2,067
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,067NET
INCOME (LOSS)
    
    $
    3,258
    
    
    $
    
    
    
    $
    1,777
    
    
    $
    (1,777
    )
    
    $
    3,258
 16




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COLEMAN CABLE, INC. AND SUBSIDIARIES  CONDENSED CONSOLIDATING BALANCE SHEET AS OF MARCH 31, 2009
 Guarantor
    
    
    Non GuarantorParent
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    TotalASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    22,036
    
    
    $
    32
    
    
    $
    1,878
    
    
    $
    
    
    
    $
    23,946Accounts receivablenet of allowances
    
    
    67,114
    
    
    
    
    
    
    
    3,985
    
    
    
    
    
    
    
    71,099Intercompany receivable
    
    
    
    
    
    
    (3
    )
    
    
    
    
    
    
    3
    
    
    
    Inventories
    
    
    54,253
    
    
    
    
    
    
    
    6,920
    
    
    
    
    
    
    
    61,173Deferred income taxes
    
    
    3,653
    
    
    
    
    
    
    
    46
    
    
    
    
    
    
    
    3,699Asset held for sale
    
    
    3,535
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,535Prepaid expenses and other current assets
    
    
    6,412
    
    
    
    11
    
    
    
    1,713
    
    
    
    
    
    
    
    8,136Total current assets
    
    
    157,003
    
    
    
    40
    
    
    
    14,542
    
    
    
    3
    
    
    
    171,588PROPERTY, PLANT AND EQUIPMENT, NET
    
    
    58,718
    
    
    
    
    
    
    
    437
    
    
    
    
    
    
    
    59,155GOODWILL
    
    
    27,598
    
    
    
    
    
    
    
    1,231
    
    
    
    
    
    
    
    28,829INTANGIBLE ASSETS, NET
    
    
    36,565
    
    
    
    
    
    
    
    186
    
    
    
    
    
    
    
    36,751OTHER ASSETS, NET
    
    
    19,330
    
    
    
    
    
    
    
    312
    
    
    
    (9,358
    )
    
    
    10,284INVESTMENT IN SUBSIDIARIES
    
    
    2,436
    
    
    
    
    
    
    
    
    
    
    
    (2,436
    )
    
    
    TOTAL ASSETS
    
    $
    301,650
    
    
    $
    40
    
    
    $
    16,708
    
    
    $
    (11,791
    )
    
    $
    306,607LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIES:Current portion of long-term debt
    
    $
    305
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    305Accounts payable
    
    
    20,341
    
    
    
    11
    
    
    
    2,528
    
    
    
    
    
    
    
    22,880Intercompany payable
    
    
    1,691
    
    
    
    
    
    
    
    (1,694
    )
    
    
    3
    
    
    
    Accrued liabilities
    
    
    28,140
    
    
    
    22
    
    
    
    4,087
    
    
    
    
    
    
    
    32,249Total current liabilities
    
    $
    50,477
    
    
    $
    33
    
    
    $
    4,921
    
    
    $
    3
    
    
    $
    55,434LONG-TERM DEBT
    
    
    242,209
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    242,209Long-term liabilities
    
    
    3,721
    
    
    
    
    
    
    
    9,358
    
    
    
    (9,358
    )
    
    
    3,721DEFERRED INCOME TAXES
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    SHAREHOLDERS EQUITY:
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Common stock
    
    
    17
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17Additional paid-in capital
    
    
    86,653
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    86,653Accumulated other comprehensive income
    
    
    (689
    )
    
    
    
    
    
    
    (847
    )
    
    
    847
    
    
    
    (689
    )Retained earnings (accumulated deficit)
    
    
    (80,738
    )
    
    
    7
    
    
    
    3,276
    
    
    
    (3,283
    )
    
    
    (80,738
    )Total shareholders equity
    
    
    5,243
    
    
    
    7
    
    
    
    2,429
    
    
    
    (2,436
    )
    
    
    5,243TOTAL LIABILITIES AND
SHAREHOLDERS EQUITY
    
    $
    301,650
    
    
    $
    40
    
    
    $
    16,708
    
    
    $
    (11,791
    )
    
    $
    306,607
 COLEMAN CABLE, INC. AND SUBSIDIARIES  CONDENSED CONSOLIDATING BALANCE SHEET AS OF DECEMBER 31, 2008
 Guarantor
    
    
    Non GuarantorParent
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    TotalASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    12,617
    
    
    $
    49
    
    
    $
    3,662
    
    
    $
    
    
    
    $
    16,328Accounts receivablenet of allowances
    
    
    90,636
    
    
    
    
    
    
    
    6,402
    
    
    
    
    
    
    
    97,038Intercompany receivable
    
    
    
    
    
    
    (17
    )
    
    
    
    
    
    
    17
    
    
    
    Inventories, net
    
    
    68,002
    
    
    
    
    
    
    
    5,366
    
    
    
    
    
    
    
    73,368Deferred income taxes
    
    
    4,159
    
    
    
    
    
    
    
    43
    
    
    
    
    
    
    
    4,202Assets held for sale
    
    
    3,535
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,535Prepaid expenses and other current assets
    
    
    10,626
    
    
    
    9
    
    
    
    53
    
    
    
    
    
    
    
    10,688Total current assets
    
    
    189,575
    
    
    
    41
    
    
    
    15,526
    
    
    
    17
    
    
    
    205,159PROPERTY, PLANT AND EQUIPMENT, NET
    
    
    60,993
    
    
    
    
    
    
    
    450
    
    
    
    
    
    
    
    61,443
 17




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##### Table of Contents



Guarantor
    
    
    Non GuarantorParent
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    TotalGOODWILL
    
    
    97,096
    
    
    
    
    
    
    
    1,258
    
    
    
    
    
    
    
    98,354INTANGIBLE ASSETS, NET
    
    
    39,164
    
    
    
    
    
    
    
    221
    
    
    
    
    
    
    
    39,385OTHER ASSETS, NET
    
    
    16,913
    
    
    
    
    
    
    
    70
    
    
    
    (9,358
    )
    
    
    7,625INVESTMENT IN SUBSIDIARIES
    
    
    2,410
    
    
    
    
    
    
    
    
    
    
    
    (2,410
    )
    
    
    TOTAL ASSETS
    
    $
    406,151
    
    
    $
    41
    
    
    $
    17,525
    
    
    $
    (11,751
    )
    
    $
    411,966LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIES:Current portion of long-term debt
    
    $
    30,445
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    30,445Accounts payable
    
    
    25,263
    
    
    
    10
    
    
    
    2,135
    
    
    
    
    
    
    
    27,408Intercompany payable
    
    
    (843
    )
    
    
    
    
    
    
    801
    
    
    
    (42
    )
    
    
    Accrued liabilities
    
    
    27,957
    
    
    
    31
    
    
    
    3,203
    
    
    
    
    
    
    
    31,191Total current liabilities
    
    $
    82,822
    
    
    $
    41
    
    
    
    6,139
    
    
    $
    (42
    )
    
    $
    89,044LONG-TERM DEBT
    
    
    242,369
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    242,369LONG-TERM LIABILITIES NET
    
    
    4,071
    
    
    
    
    
    
    
    9,358
    
    
    
    (9,383
    )
    
    
    4,046DEFERRED INCOME TAXES
    
    
    7,470
    
    
    
    
    
    
    
    (382
    )
    
    
    
    
    
    
    7,088SHAREHOLDERS EQUITY:Common stock
    
    
    17
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17Additional paid-in capital
    
    
    86,135
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    86,135Accumulated other comprehensive income
    
    
    (765
    )
    
    
    
    
    
    
    (629
    )
    
    
    629
    
    
    
    (765
    )Retained earnings (accumulated deficit)
    
    
    (15,968
    )
    
    
    
    
    
    
    3,039
    
    
    
    (3,039
    )
    
    
    (15,968
    )Total shareholders equity
    
    
    69,419
    
    
    
    
    
    
    
    2,410
    
    
    
    (2,410
    )
    
    
    69,419TOTAL LIABILITIES AND
SHAREHOLDERS EQUITY
    
    $
    406,151
    
    
    $
    41
    
    
    $
    17,525
    
    
    $
    (11,751
    )
    
    $
    411,966
 18




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##### Table of Contents



COLEMAN CABLE, INC. AND SUBSIDIARIES  CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2009
 Guarantor
    
    
    Non GuarantorParent
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    TotalCASH FLOW FROM OPERATING ACTIVITIES:Net income
(loss)
    
    $
    (64,770
    )
    
    $
    7
    
    
    $
    237
    
    
    $
    (244
    )
    
    $
    (64,770
    )Adjustments to reconcile net income to net cash flow from
operating activities:Depreciation and amortization
    
    
    6,341
    
    
    
    
    
    
    
    75
    
    
    
    
    
    
    
    6,416Stock-based compensation
    
    
    518
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    518Foreign currency translation loss
    
    
    
    
    
    
    
    
    
    
    339
    
    
    
    
    
    
    
    339Asset Impairments
    
    
    69,498
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    69,498Deferred taxes
    
    
    (9,932
    )
    
    
    
    
    
    
    137
    
    
    
    
    
    
    
    (9,795
    )Loss on disposal of fixed assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity in consolidated subsidiaries
    
    
    (244
    )
    
    
    
    
    
    
    
    
    
    
    244
    
    
    
    Changes in operating assets and liabilities:Accounts receivable
    
    
    23,522
    
    
    
    
    
    
    
    2,245
    
    
    
    
    
    
    
    25,767Inventories
    
    
    13,749
    
    
    
    
    
    
    
    (1,773
    )
    
    
    
    
    
    
    11,976Prepaid expenses and other assets
    
    
    4,569
    
    
    
    (2
    )
    
    
    (1,685
    )
    
    
    
    
    
    
    2,882Accounts payable
    
    
    (4,912
    )
    
    
    1
    
    
    
    415
    
    
    
    
    
    
    
    (4,496
    )Intercompany accounts
    
    
    2,510
    
    
    
    (14
    )
    
    
    (2,496
    )
    
    
    
    
    
    
    Accrued liabilities
    
    
    (142
    )
    
    
    (9
    )
    
    
    672
    
    
    
    
    
    
    
    521Net cash flow from operating activities
    
    
    40,707
    
    
    
    (17
    )
    
    
    (1,834
    )
    
    
    
    
    
    
    38,856CASH FLOW FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    (1,150
    )
    
    
    
    
    
    
    (41
    )
    
    
    
    
    
    
    (1,191
    )Proceeds from sale of fixed assets
    
    
    6
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6Net cash flow from investing activities
    
    
    (1,144
    )
    
    
    
    
    
    
    (41
    )
    
    
    
    
    
    
    (1,185
    )CASH FLOW FROM FINANCING ACTIVITIES:Net borrowings under revolving loan facilities
    
    
    (30,000
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (30,000
    )Repayment of long -term debt
    
    
    (144
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (144
    )Net cash flow from financing activities
    
    
    (30,144
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (30,144
    )Effect of exchange rate on cash and
cash equivalents
    
    
    
    
    
    
    
    
    
    
    91
    
    
    
    
    
    
    
    91INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    
    
    9,419
    
    
    
    (17
    )
    
    
    (1,784
    )
    
    
    
    
    
    
    7,618CASH AND CASH EQUIVALENTS  Beginning of period
    
    
    12,617
    
    
    
    49
    
    
    
    3,662
    
    
    
    
    
    
    
    16,328CASH AND CASH EQUIVALENTS  End of period
    
    $
    22,036
    
    
    $
    32
    
    
    $
    1,878
    
    
    $
    
    
    
    $
    23,946NONCASH ACTIVITYUnpaid capital expenditures
    
    
    124
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    124Capital lease obligation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    SUPPLEMENTAL CASH FLOW INFORMATIONIncome taxes paid (refunded)
    
    
    (2,313
    )
    
    
    
    
    
    
    212
    
    
    
    
    
    
    
    (2,101
    )Cash interest paid
    
    
    241
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    241
 19




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##### Table of Contents



COLEMAN CABLE, INC. AND SUBSIDIARIES  CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2008
 Guarantor
    
    
    Non GuarantorParent
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    TotalCASH FLOW FROM OPERATING ACTIVITIES:Net income
    
    $
    3,258
    
    
    $
    
    
    
    $
    1,777
    
    
    $
    (1,777
    )
    
    $
    3,258Adjustments to reconcile net income to net cash flow from
operating activities:Depreciation and amortization
    
    
    7,080
    
    
    
    
    
    
    
    69
    
    
    
    
    
    
    
    7,149Stock-based compensation
    
    
    603
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    603Deferred tax provision
    
    
    (258
    )
    
    
    
    
    
    
    (5
    )
    
    
    
    
    
    
    (263
    )Loss on disposal of fixed assets
    
    
    68
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    68Equity in consolidated subsidiaries
    
    
    (1,777
    )
    
    
    
    
    
    
    
    
    
    
    1,777
    
    
    
    Changes in operating assets and liabilities:Accounts receivable
    
    
    9,072
    
    
    
    
    
    
    
    2,981
    
    
    
    
    
    
    
    12,053Inventories
    
    
    (8,051
    )
    
    
    
    
    
    
    (677
    )
    
    
    
    
    
    
    (8,728
    )Prepaid expenses and other assets
    
    
    (595
    )
    
    
    
    
    
    
    (552
    )
    
    
    0
    
    
    
    (1,147
    )Accounts payable
    
    
    (11,783
    )
    
    
    (15
    )
    
    
    270
    
    
    
    
    
    
    
    (11,528
    )Intercompany accounts
    
    
    4,153
    
    
    
    28
    
    
    
    (4,181
    )
    
    
    
    
    
    
    Accrued liabilities
    
    
    (3,983
    )
    
    
    (4
    )
    
    
    (1,010
    )
    
    
    0
    
    
    
    (4,997
    )Net cash flow from operating activities
    
    
    (2,213
    )
    
    
    9
    
    
    
    (1,328
    )
    
    
    
    
    
    
    (3,532
    )CASH FLOW FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    (4,357
    )
    
    
    
    
    
    
    7
    
    
    
    
    
    
    
    (4,350
    )Acquisition of businesses, net of cash
acquired
    
    
    16
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16Proceeds from sale of fixed assets
    
    
    13
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13Net cash flow from investing activities
    
    
    (4,328
    )
    
    
    
    
    
    
    7
    
    
    
    
    
    
    
    (4,321
    )CASH FLOW FROM FINANCING ACTIVITIES:Net borrowings under revolving loan facilities
    
    
    3,047
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,047Repayment of long -term debt
    
    
    (224
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (224
    )Net cash flow from financing activities
    
    
    2,823
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,823Effect of exchange rate on cash and
cash equivalents
    
    
    
    
    
    
    
    
    
    
    53
    
    
    
    
    
    
    
    53INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    
    
    (3,718
    )
    
    
    9
    
    
    
    (1,268
    )
    
    
    
    
    
    
    (4,977
    )CASH AND CASH EQUIVALENTS  Beginning of period
    
    
    3,835
    
    
    
    1
    
    
    
    5,041
    
    
    
    
    
    
    
    8,877CASH AND CASH EQUIVALENTS  End of period
    
    $
    117
    
    
    $
    10
    
    
    $
    3,773
    
    
    $
    
    
    
    $
    3,900NONCASH ACTIVITYUnpaid capital expenditures
    
    
    1,312
    
    
    
    0
    
    
    
    
    
    
    
    
    
    
    
    1,312Capital lease obligation
    
    
    104
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    104SUPPLEMENTAL CASH FLOW INFORMATIONIncome taxes paid
    
    
    936
    
    
    
    0
    
    
    
    
    
    
    
    
    
    
    
    936Cash interest paid
    
    
    1,818
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,818
 20




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##### Table of Contents



ITEM 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 The following discussion contains forward-looking statements that involve risks and
uncertainties. Our actual results may differ materially from those anticipated in these
forward-looking statements as a result of a variety of risks and uncertainties, including those
described in this report under Cautionary Note Regarding Forward-Looking Statements and under
Item 1A.Risk Factors in our Annual Report on Form 10-K , for the fiscal year ended December 31,
2008. We assume no obligation to update any of these forward-looking statements. You should read
the following discussion in conjunction with our condensed consolidated financial statements and
the notes thereto included in this report.
 Overview
 General
     21




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##### Table of Contents



Consolidated Results of Operations
  Three Months Ended March 31,2009
    
    
    2008Amount
    
    
    %
    
    
    Amount
    
    
    %(In thousands)Net sales
    
    $
    117,322
    
    
    
    100.0
    %
    
    $
    252,483
    
    
    
    100.0
    %Gross profit
    
    
    16,548
    
    
    
    14.1
    
    
    
    28,849
    
    
    
    11.4Selling, engineering, general and administrative expenses
    
    
    10,659
    
    
    
    9.1
    
    
    
    12,761
    
    
    
    5.1Intangible amortization expense
    
    
    2,630
    
    
    
    2.2
    
    
    
    2,662
    
    
    
    1.1Asset impairments
    
    
    69,498
    
    
    
    59.2
    
    
    
    
    
    
    
    Restructuring charges
    
    
    657
    
    
    
    0.6
    
    
    
    176
    
    
    
    0.1Operating income (loss)
    
    
    (66,896
    )
    
    
    (57.0
    )
    
    
    13,250
    
    
    
    5.2Interest expense
    
    
    6,405
    
    
    
    5.5
    
    
    
    7,804
    
    
    
    3.2Other expense, net
    
    
    339
    
    
    
    0.3
    
    
    
    121
    
    
    
    0.1Income (loss) before income taxes
    
    
    (73,640
    )
    
    
    (62.8
    )
    
    
    5,325
    
    
    
    2.1Income tax expense (benefit)
    
    
    (8,870
    )
    
    
    (7.6
    )
    
    
    2,067
    
    
    
    0.8Net (loss) income
    
    $
    (64,770
    )
    
    
    (55.2
    )
    
    $
    3,258
    
    
    
    1.3
  Three Months Ended March 31,2009
    
    
    2008(In thousands)Net income (loss)
    
    $
    (64,770
    )
    
    $
    3,258Interest expense
    
    
    6,405
    
    
    
    7,804Income tax expense (benefit)
    
    
    (8,870
    )
    
    
    2,067Depreciation and amortization expense
    
    
    6,095
    
    
    
    6,837EBITDA
    
    $
    (61,140
    )
    
    $
    19,966
   22




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##### Table of Contents



Three Months Ended March 31,2009
    
    
    2008(In thousands)Net cash flow from operating activities
    
    $
    38,856
    
    
    $
    (3,532
    )Interest expense
    
    
    6,405
    
    
    
    7,804Income tax expense (benefit)
    
    
    (8,870
    )
    
    
    2,067Deferred tax provisions
    
    
    9,795
    
    
    
    263Gain (loss) on sale of fixed assets
    
    
    
    
    
    
    (68
    )Stock-based compensation
    
    
    (518
    )
    
    
    (603
    )Asset impairments
    
    
    (69,498
    )
    
    
    Changes in operating assets and liabilities
    
    
    (37,310
    )
    
    
    14,035EBITDA
    
    $
    (61,140
    )
    
    $
    19,966
 Three Months Ended March 31, 2009 Compared with Three Months Ended March 31, 2008
 Net sales
 Gross profit
 Selling, engineering, general and administrative (SEG&A) expense
 Intangible amortization expense
 Asset impairments
 23




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##### Table of Contents



Restructuring charges
  Interest expense 
 Income tax expense (benefit)
 Segment Results
  Three Months Ended March 31,2009
    
    
    2008Amount
    
    
    %
    
    
    Amount
    
    
    %(In thousands)Net Sales:Distribution
    
    $
    90,100
    
    
    
    76.8
    %
    
    $
    164,627
    
    
    
    65.2
    %OEM
    
    
    27,222
    
    
    
    23.2
    
    
    
    87,856
    
    
    
    34.8Total
    
    $
    117,322
    
    
    
    100.0
    %
    
    $
    252,483
    
    
    
    100.0
    %Operating Income (Loss):Distribution
    
    $
    7,575
    
    
    
    8.4
    %
    
    $
    16,290
    
    
    
    9.9
    %OEM
    
    
    493
    
    
    
    1.8
    
    
    
    2,734
    
    
    
    3.1Total segments
    
    
    8,068
    
    
    
    
    
    
    
    19,024Corporate
    
    
    (74,964
    )
    
    
    
    
    
    
    (5,774
    )Consolidated operating income (loss)
    
    $
    (66,896
    )
    
    
    (57.0
    )%
    
    $
    13,250
    
    
    
    5.2
    %
  24




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##### Table of Contents



Three Months Ended March 31, 2009 Compared with Three Months Ended March 31, 2008
 Distribution Segment
   OEM Segment
   Liquidity and Capital Resources
 Debt
  As of
    
    
    As ofMarch 31,
    
    
    December 31,2009
    
    
    2008Revolving credit facility expiring April 2, 2012
    
    $
    
    
    
    $
    30,000Senior notes due October 1, 2012
    
    
    242,195
    
    
    
    242,352Capital lease obligations
    
    
    319
    
    
    
    462Total long-term debt, including current portion
    
    $
    242,514
    
    
    $
    272,814
  
 25




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##### Table of Contents



Revolving
Credit Facility
      9.875% Senior Notes
    Current and Future Liquidity
   26




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##### Table of Contents



New Accounting Pronouncements
 Business Combinations
 Fair Value Measurements.
 Noncontrolling Interests in Consolidated
Financial Statements  an amendment of ARB No. 51
 27




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##### Table of Contents



Disclosures about Derivative Instruments and Hedging
Activitiesan Amendment of FASB Statement No. 133
  Cautionary Note Regarding Forward-Looking Statements
  www.sec.gov)
  
    
    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 conditions and capital market conditions;
    
    changes in the demand for our products by key customers;
    
    additional impairment charges related to our goodwill and long-lived assets;
    
    failure of customers to make expected purchases, including customers of acquired companies;
    
    changes in the cost of labor or raw materials, including PVC and fuel costs;
    
    failure to identify, finance or integrate acquisitions;
    
    failure to accomplish integration activities on a timely basis;
    
    failure to achieve expected efficiencies in our manufacturing and integration
consolidations;
    
    unforeseen developments or expenses with respect to our acquisition, integration and
consolidation efforts; and
    
    other risks and uncertainties, including those described under Item 1A. Risk Factors in
our Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
 28




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##### Table of Contents



ITEM 3. Quantitative and Qualitative Disclosures about Market Risk
  Commodity Risk.
 Interest Rate Risk.
 
 ITEM 4. Controls and Procedures
   
 PART II OTHER INFORMATION
 
 ITEM 1. Legal Proceedings
  
 ITEM 5. Other Information
  29




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##### Table of Contents



ITEM 6. Exhibits
  30




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##### Table of Contents



SIGNATURES
  COLEMAN CABLE, INC.(Registrant)Date: May 8, 2009
    By
    /s/ G. Gary YetmanChief Executive Officer and PresidentDate: May 8, 2009
    By
    /s/ Richard N. BurgerChief Financial Officer, ExecutiveVice President, Secretary and Treasurer 31




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##### Table of Contents



Item No.
    
    Description3.1 
    
    Certificate of Incorporation of Coleman Cable, Inc., as filed with the Delaware Secretary of State
on October 10, 2006, incorporated herein by reference to our Quarterly Report on Form 10-Q for the
quarter ended September 30, 2006.3.2 
    
    Amended and Restated By-Laws of Coleman Cable, Inc., incorporated herein by reference to our
Current Report on Form 8-K as filed on May 5, 2008.*10.1 
    
    Form of Restricted Stock Award Agreement under the Coleman Cable, Inc. Long-Term Incentive Plan.*10.2 
    
    Severance Agreement dated as of May 7, 2009 between the Company and K. McAllister.31.1 
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2 
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1 
    
    Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section
1350, adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Denotes management contract or compensatory plan or arrangement. 32