##### Table of Contents



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 December 31, 2005
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 Commission File Number 1-11263
 EXIDE TECHNOLOGIES
 (Exact Name of Registrant as Specified in Its Charter)
 Delaware
    
    23-0552730(State or other jurisdiction of
incorporation or organization)
    
    (I.R.S. Employer
Identification Number)13000 Deerfield Parkway,
Building 200Alpharetta, Georgia
(Address of principal executive offices)
    
    30004
(Zip Code)
 (678) 566-9000
(Registrants telephone number, including area code)
 þ o
  o þ o
 þ o
 o þ




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##### 



EXIDE TECHNOLOGIES AND SUBSIDIARIES
TABLE OF CONTENTS
 PagePART I. FINANCIAL INFORMATIONItem 1 FINANCIAL STATEMENTS
    
    
    3CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE
MONTHS ENDED DECEMBER 31, 2005 AND 2004 (SUCCESSOR COMPANY), FOR
THE NINE MONTHS ENDED DECEMBER 31, 2005 (SUCCESSOR COMPANY), FOR
THE PERIOD MAY 6, 2004 TO DECEMBER 31, 2004 (SUCCESSOR COMPANY)
AND FOR THE PERIOD APRIL 1, 2004 TO MAY 5, 2004 (PREDECESSOR
COMPANY)
    
    
    3CONDENSED CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2005
AND MARCH 31, 2005 (SUCCESSOR COMPANY)
    
    
    5CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE
MONTHS ENDED DECEMBER 31, 2005 (SUCCESSOR COMPANY), FOR THE PERIOD
MAY 6, 2004 TO DECEMBER 31, 2004 (SUCCESSOR COMPANY), AND FOR THE
PERIOD APRIL 1, 2004 TO MAY 5, 2004 (PREDECESSOR COMPANY)
    
    
    6NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
    
    
    7Item 2 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
    
    
    20Item 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    30Item 4 CONTROLS AND PROCEDURES
    
    
    30PART II. OTHER INFORMATIONItem 1. LEGAL PROCEEDINGS
    
    
    33Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
    
    
    33Item 3. DEFAULTS UPON SENIOR SECURITIES
    
    
    33Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
    
    
    33Item 5. OTHER INFORMATION
    
    
    33Item 6. EXHIBITS
    
    
    33SIGNATURES
    
    
    34EX-31.1 SECTION 302 CERTIFICATION OF CEOEX-31.2 SECTION 302 CERTIFICATION OF CFOEX-32 SECTION 906 CERTIFICATION OF THE CEO AND CFO
  2




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 EXIDE TECHNOLOGIES AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (Unaudited, in thousands, except per-share data)
 Successor
    
    
    SuccessorCompany
    
    
    Companyfor the
    
    
    for theThree Months
    
    
    Three MonthsEnded
    
    
    EndedDecember 31, 2005
    
    
    December 31, 2004NET SALES
    
    $
    733,442
    
    
    $
    727,902COST OF SALES
    
    
    614,609
    
    
    
    602,151Gross profit
    
    
    118,833
    
    
    
    125,751EXPENSES:Selling, marketing and advertising
    
    
    66,261
    
    
    
    69,003General and administrative
    
    
    42,471
    
    
    
    47,365Restructuring and impairment
    
    
    6,511
    
    
    
    5,713Goodwill Impairment
    
    
    
    
    
    
    399,388Other expense (income) net
    
    
    7,973
    
    
    
    (5,005
    )Interest expense net
    
    
    18,404
    
    
    
    11,728141,620
    
    
    
    528,192Loss before reorganization items, income taxes and minority interest
    
    
    (22,787
    )
    
    
    (402,441
    )REORGANIZATION ITEMS, NET
    
    
    1,311
    
    
    
    2,236INCOME TAX PROVISION
    
    
    3,528
    
    
    
    34,484MINORITY INTEREST
    
    
    32
    
    
    
    (121
    )Net loss
    
    $
    (27,658
    )
    
    $
    (439,040
    )NET LOSS PER SHAREBasic and Diluted
    
    $
    (1.11
    )
    
    $
    (17.56
    )WEIGHTED AVERAGE SHARESBasic and Diluted
    
    
    25,000
    
    
    
    25,000
  3




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##### Table of Contents



EXIDE TECHNOLOGIES AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per-share data)
 SuccessorCompany
    
    
    Successor
    
    
    Predecessorfor the
    
    
    Company
    
    
    CompanyNine Months
    
    
    for the Period
    
    
    for the PeriodEnded
    
    
    May 6, 2004 to
    
    
    April 1, 2004 toDecember 31, 2005
    
    
    December 31, 2004
    
    
    May 5, 2004NET SALES
    
    $
    2,089,259
    
    
    $
    1,763,429
    
    
    $
    214,607COST OF SALES
    
    
    1,764,317
    
    
    
    1,477,867
    
    
    
    179,137Gross profit
    
    
    324,942
    
    
    
    285,562
    
    
    
    35,470EXPENSES:Selling, marketing and advertising
    
    
    204,948
    
    
    
    178,617
    
    
    
    24,504General and administrative
    
    
    129,347
    
    
    
    108,601
    
    
    
    17,940Restructuring and impairment
    
    
    16,051
    
    
    
    12,986
    
    
    
    602Goodwill Impairment
    
    
    
    
    
    
    399,388
    
    
    
    Other expense (income) net
    
    
    12,781
    
    
    
    (57,042
    )
    
    
    6,222Interest expense net
    
    
    51,163
    
    
    
    29,165
    
    
    
    8,870414,290
    
    
    
    671,715
    
    
    
    58,138Loss before reorganization items, income taxes and minority interest
    
    
    (89,348
    )
    
    
    (386,153
    )
    
    
    (22,668
    )REORGANIZATION ITEMS, NET
    
    
    4,398
    
    
    
    5,654
    
    
    
    18,434FRESH START ACCOUNTING ADJUSTMENTS, NET
    
    
    
    
    
    
    
    
    
    
    (228,371
    )GAIN ON DISCHARGE OF LIABILITIES SUBJECT TO COMPROMISE
    
    
    
    
    
    
    
    
    
    
    (1,558,839
    )INCOME TAX PROVISION (BENEFIT)
    
    
    2,572
    
    
    
    30,782
    
    
    
    (2,482
    )MINORITY INTEREST
    
    
    72
    
    
    
    (75
    )
    
    
    26Net income (loss)
    
    $
    (96,390
    )
    
    $
    (422,514
    )
    
    $
    1,748,564NET INCOME (LOSS) PER SHAREBasic and Diluted
    
    $
    (3.86
    )
    
    $
    (16.90
    )
    
    $
    63.86WEIGHTED AVERAGE SHARESBasic and Diluted
    
    
    25,000
    
    
    
    25,000
    
    
    
    27,383
  4




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##### Table of Contents



EXIDE TECHNOLOGIES AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (Unaudited, in thousands, except per-share data)
 Successor CompanyDecember 31, 2005
    
    
    March 31, 2005ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    36,872
    
    
    $
    76,696Restricted cash
    
    
    548
    
    
    
    1,323Receivables, net of allowance for doubtful accounts of $20,236 and $22,471
    
    
    635,221
    
    
    
    687,715Inventories
    
    
    429,451
    
    
    
    397,689Prepaid expenses and other
    
    
    34,182
    
    
    
    21,275Deferred financing costs, net
    
    
    1,770
    
    
    
    1,725Deferred income taxes
    
    
    5,419
    
    
    
    4,305Total current assets
    
    
    1,143,463
    
    
    
    1,190,728PROPERTY, PLANT AND EQUIPMENT, NET
    
    
    691,384
    
    
    
    799,763OTHER ASSETS:Intangible assets, net
    
    
    188,229
    
    
    
    192,854Investments in affiliates
    
    
    7,147
    
    
    
    9,010Deferred financing costs, net
    
    
    11,215
    
    
    
    12,784Deferred income taxes
    
    
    55,711
    
    
    
    55,896Other
    
    
    26,030
    
    
    
    29,745288,332
    
    
    
    300,289Total assets
    
    $
    2,123,179
    
    
    $
    2,290,780LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIES:Short-term borrowings
    
    $
    14,700
    
    
    $
    1,595Current maturities of long-term debt
    
    
    24,380
    
    
    
    632,116Accounts payable
    
    
    341,411
    
    
    
    340,480Accrued expenses
    
    
    347,465
    
    
    
    385,521Warrants liability
    
    
    1,688
    
    
    
    11,188Total current liabilities
    
    
    729,644
    
    
    
    1,370,900LONG-TERM DEBT
    
    
    639,213
    
    
    
    20,047NONCURRENT RETIREMENT OBLIGATIONS
    
    
    313,294
    
    
    
    329,628NONCURRENT DEFERRED TAX LIABILITY
    
    
    29,511
    
    
    
    24,178OTHER NONCURRENT LIABILITIES
    
    
    97,532
    
    
    
    106,004Total liabilities
    
    
    1,809,194
    
    
    
    1,850,757COMMITMENTS AND CONTINGENCIES
    
    
    
    
    
    
    MINORITY INTEREST
    
    
    11,993
    
    
    
    12,764STOCKHOLDERS EQUITYPreferred stock, $0.01 par value, 1,000 shares authorized, 0 shares issued and outstanding
    
    
    
    
    
    
    Common stock, $0.01 par value, 61,500 shares authorized, 24,542 and 24,407 shares issued
and outstanding
    
    
    245
    
    
    
    234Additional paid-in capital
    
    
    888,479
    
    
    
    888,157Accumulated deficit
    
    
    (563,313
    )
    
    
    (466,923
    )Accumulated other comprehensive (loss) income
    
    
    (23,419
    )
    
    
    5,791Total stockholders equity
    
    
    301,992
    
    
    
    427,259Total liabilities and stockholders equity
    
    $
    2,123,179
    
    
    $
    2,290,780
  5




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##### Table of Contents



EXIDE TECHNOLOGIES AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited, in thousands)
 SuccessorCompany
    
    
    Successor
    
    
    Predecessorfor the
    
    
    Company
    
    
    CompanyNine months
    
    
    for the Period
    
    
    for the PeriodEnded
    
    
    May 6, 2004 to
    
    
    April 1, 2004 toDecember 31, 2005
    
    
    December 31, 2004
    
    
    May 5, 2004CASH FLOWS FROM OPERATING ACTIVITIES:Net income (loss)
    
    $
    (96,390
    )
    
    $
    (422,514
    )
    
    $
    1,748,564Adjustments to reconcile net income (loss) to net
cash used in operating activities:Depreciation and amortization
    
    
    90,519
    
    
    
    84,194
    
    
    
    7,848Impairment of Goodwill
    
    
    
    
    
    
    399,388
    
    
    
    Gain on discharge of liabilities subject to compromise
    
    
    
    
    
    
    
    
    
    
    (1,558,839
    )Fresh Start accounting adjustments, net
    
    
    
    
    
    
    
    
    
    
    (228,371
    )Unrealized gain on Warrants
    
    
    (9,500
    )
    
    
    (61,488
    )
    
    
    Net loss on asset sales
    
    
    12,270
    
    
    
    1,227
    
    
    
    Provision for doubtful accounts
    
    
    2,401
    
    
    
    2,167
    
    
    
    473Deferred income taxes
    
    
    
    
    
    
    680
    
    
    
    Non-cash provision for restructuring
    
    
    1,002
    
    
    
    108
    
    
    
    18Reorganization items, net
    
    
    4,398
    
    
    
    5,654
    
    
    
    18,434Insurance proceeds
    
    
    
    
    
    
    2,143
    
    
    
    Minority interest
    
    
    72
    
    
    
    (75
    )
    
    
    26Amortization of deferred financing costs
    
    
    1,347
    
    
    
    
    
    
    
    1,251Changes in assets and liabilities, excluding effects
of Fresh Start accounting, acquisitions and
divestitures:Receivables
    
    
    10,342
    
    
    
    (41,745
    )
    
    
    45,924Inventories
    
    
    (51,451
    )
    
    
    (12,408
    )
    
    
    (10,873
    )Prepaid expenses and other
    
    
    (13,199
    )
    
    
    (2,378
    )
    
    
    286Payables
    
    
    19,007
    
    
    
    32,464
    
    
    
    (20,967
    )Accrued expenses
    
    
    (17,208
    )
    
    
    (28,982
    )
    
    
    (20,564
    )Noncurrent liabilities
    
    
    (7,210
    )
    
    
    (3,443
    )
    
    
    (294
    )Other, net
    
    
    9,199
    
    
    
    31,360
    
    
    
    9,898Net cash used in operating activities
    
    
    (44,401
    )
    
    
    (13,648
    )
    
    
    (7,186
    )CASH FLOWS FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    (37,861
    )
    
    
    (44,577
    )
    
    
    (7,152
    )Proceeds from sales of assets
    
    
    19,657
    
    
    
    20,962
    
    
    
    2,800Net cash used in investing activities
    
    
    (18,204
    )
    
    
    (23,615
    )
    
    
    (4,352
    )CASH FLOWS FROM FINANCING ACTIVITIES:Increase in short-term borrowings
    
    
    13,963
    
    
    
    4,174
    
    
    
    2,425Repayments under Senior Notes
    
    
    
    
    
    
    
    
    
    
    (110,082
    )Borrowings under Credit Facility
    
    
    
    
    
    
    168,593
    
    
    
    621,258Repayments under Credit Facility
    
    
    (12,804
    )
    
    
    (169,332
    )
    
    
    (452,875
    )Currency Swap
    
    
    (12,084
    )
    
    
    
    
    
    
    Increase (decrease) in other debt
    
    
    36,081
    
    
    
    (2,036
    )
    
    
    (2,412
    )Financing costs and other
    
    
    
    
    
    
    (682
    )
    
    
    (23,146
    )Net cash provided by financing activities
    
    
    25,156
    
    
    
    717
    
    
    
    35,168EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH
EQUIVALENTS
    
    
    (2,375
    )
    
    
    3,031
    
    
    
    (1,447
    )NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS
    
    
    (39,824
    )
    
    
    (33,515
    )
    
    
    22,183CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
    
    
    76,696
    
    
    
    59,596
    
    
    
    37,413CASH AND CASH EQUIVALENTS, END OF PERIOD
    
    $
    36,872
    
    
    $
    26,081
    
    
    $
    59,596
  6




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##### Table of Contents



EXIDE TECHNOLOGIES AND SUBSIDIARIES
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 December 31, 2005
(In thousands, except share and per-share data)
(Unaudited)
 (1) BASIS OF PRESENTATION
        7




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##### Table of Contents



(2) WARRANTS
  (3) COMPREHENSIVE INCOME (LOSS)
  Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Period
    
    
    PeriodEnded
    
    
    Ended
    
    
    Ended
    
    
    May 6, 2004 to
    
    
    April 1, 2004 toDecember 31, 2005
    
    
    December 31, 2004
    
    
    December 31, 2005
    
    
    December 31, 2004
    
    
    May 5, 2004Net income (loss)
    
    $
    (27,658
    )
    
    $
    (439,040
    )
    
    $
    (96,390
    )
    
    $
    (422,514
    )
    
    $
    1,748,564Additions and changes in fair
value of cash flow hedges
    
    
    
    
    
    
    3,033
    
    
    
    
    
    
    
    3,963
    
    
    
    Reclassification of cash flow
hedges to earnings
    
    
    
    
    
    
    (151
    )
    
    
    
    
    
    
    (434
    )
    
    
    Additions and changes in
minimum pension liability
    
    
    54
    
    
    
    
    
    
    
    333
    
    
    
    
    
    
    
    Change in cumulative
translation adjustment
    
    
    (5,901
    )
    
    
    38,316
    
    
    
    (29,543
    )
    
    
    42,104
    
    
    
    (7,591
    )Total comprehensive income
(loss)
    
    $
    (33,505
    )
    
    $
    (397,842
    )
    
    $
    (125,600
    )
    
    $
    (376,881
    )
    
    $
    1,740,973
 8




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##### Table of Contents



(4) REORGANIZATION ITEMS, NET
  Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Period
    
    
    PeriodEnded
    
    
    Ended
    
    
    Ended
    
    
    May 6, 2004 to
    
    
    April 1, 2004 toDecember 31, 2005
    
    
    December 31, 2004
    
    
    December 31, 2005
    
    
    December 31, 2004
    
    
    May 5, 2004Professional fees
    
    $
    917
    
    
    $
    2,725
    
    
    $
    2,913
    
    
    $
    6,743
    
    
    $
    18,515Interest income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (81
    )Other
    
    
    394
    
    
    
    (489
    )
    
    
    1,485
    
    
    
    (1,089
    )
    
    
    Total reorganization items, net
    
    $
    1,311
    
    
    $
    2,236
    
    
    $
    4,398
    
    
    $
    5,654
    
    
    $
    18,434Gain on settlement of
liabilities subject to
compromise and
recapitalization
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,558,839
    )Fresh Start accounting
adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (228,371
    )Loss (gain) on reorganization
items
    
    $
    1,311
    
    
    $
    2,236
    
    
    $
    4,398
    
    
    $
    5,654
    
    
    $
    (1,768,776
    )
   Professional fees
  Interest income
  Other
  (5) INTANGIBLE ASSETS, NET
  Trademarks andTradenamesTrademarks and Tradenames
    
    
    (subject to
    
    
    Customer(not subject to amortization)
    
    
    amortization)
    
    
    relationships
    
    
    Technology
    
    
    TotalAs of March 31, 2005Gross Amount
    
    $
    56,331
    
    
    $
    12,813
    
    
    $
    105,968
    
    
    $
    23,781
    
    
    $
    198,893Accumulated Amortization
    
    
    
    
    
    
    (928
    )
    
    
    (4,029
    )
    
    
    (1,082
    )
    
    
    (6,039
    )Net
    
    $
    56,331
    
    
    $
    11,885
    
    
    $
    101,939
    
    
    $
    22,699
    
    
    $
    192,854As of December 31, 2005Gross Amount
    
    $
    56,331
    
    
    $
    12,813
    
    
    $
    106,339
    
    
    $
    23,781
    
    
    $
    199,264Accumulated Amortization
    
    
    
    
    
    
    (1,687
    )
    
    
    (7,382
    )
    
    
    (1,966
    )
    
    
    (11,035
    )Net
    
    $
    56,331
    
    
    $
    11,126
    
    
    $
    98,957
    
    
    $
    21,815
    
    
    $
    188,229
  9




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##### Table of Contents



(6) INVENTORIES
  December 31, 2005
    
    
    March 31, 2005Raw materials
    
    $
    72,225
    
    
    $
    62,552Work-in-process
    
    
    76,515
    
    
    
    76,097Finished goods
    
    
    280,712
    
    
    
    259,040$
    429,452
    
    
    $
    397,689
 (7) OTHER ASSETS
  December 31, 2005
    
    
    March 31, 2005Deposits
    
    
    10,317
    
    
    
    10,211Capitalized software, net
    
    
    7,026
    
    
    
    10,390Loan to affiliate
    
    
    4,930
    
    
    
    4,930Other
    
    
    3,757
    
    
    
    4,214$
    26,030
    
    
    $
    29,745
  (8) DEBT
   December 31, 2005
    
    
    March 31, 2005Senior Secured Credit Facility
    
    $
    290,048
    
    
    $
    266,47010.5% Senior Secured Notes due 2013
    
    
    290,000
    
    
    
    290,000Floating Rate Convertible Senior Subordinated Notes due 2013
    
    
    60,000
    
    
    
    60,000Other, including capital lease obligations and other loans
at interest rates generally ranging up to 11.0% due in
installments through 2015 (1)
    
    
    23,545
    
    
    
    35,693Total
    
    
    663,593
    
    
    
    652,163Lesscurrent maturities (2)
    
    
    24,380
    
    
    
    632,116$
    639,213
    
    
    $
    20,047
  (1)
    
    Includes various operating lines of credit and working
capital facilities maintained by certain of the
Companys non-U.S. subsidiaries.(2)
    
    At March 31, 2005, the Company reclassified its
borrowings under the Credit Agreement, the 10.5% Senior
Secured Notes and the Floating Rate Convertible Senior
Subordinated Notes as current as a result of a default
under the Credit Agreement. During the first fiscal
quarter of 2006, the Company secured an amendment and
received a waiver of the default described above. With
the waiver, the long-term portion of the Credit
Agreement and the Notes no longer require classification
as current.
 (9) INTEREST EXPENSE, NET
  10




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(10) OTHER (INCOME) EXPENSE, NET
  Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Period
    
    
    PeriodEnded
    
    
    Ended
    
    
    Ended
    
    
    May 6, 2004 to
    
    
    April 1, 2004 toDecember 31, 2005
    
    
    December 31, 2004
    
    
    December 31, 2005
    
    
    December 31, 2004
    
    
    May 5, 2004Net loss on asset sales
    
    $
    9,602
    
    
    $
    1,216
    
    
    $
    12,270
    
    
    $
    1,227
    
    
    $
    Equity income
    
    
    (432
    )
    
    
    (411
    )
    
    
    (1,421
    )
    
    
    (1,044
    )
    
    
    (164
    )Currency (gain) loss
    
    
    768
    
    
    
    (8,630
    )
    
    
    12,721
    
    
    
    (9,322
    )
    
    
    6,283Loss on revaluation of
foreign currency forward
contract
    
    
    
    
    
    
    16,201
    
    
    
    
    
    
    
    21,845
    
    
    
    Gain on revaluation of
Warrants
    
    
    (1,750
    )
    
    
    (5,813
    )
    
    
    (9,500
    )
    
    
    (61,488
    )
    
    
    Other
    
    
    (215
    )
    
    
    (7,568
    )
    
    
    (1,289
    )
    
    
    (8,260
    )
    
    
    103$
    7,973
    
    
    $
    (5,005
    )
    
    $
    12,781
    
    
    $
    (57,042
    )
    
    $
    6,222
 (11) EMPLOYEE BENEFITS
  Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Period
    
    
    PeriodEnded
    
    
    Ended
    
    
    Ended
    
    
    May 6, 2004 to
    
    
    April 1, 2004 toDecember 31, 2005
    
    
    December 31, 2004
    
    
    December 31, 2005
    
    
    December 31, 2004
    
    
    May 5, 2004Service cost
    
    $
    2,684
    
    
    
    2,699
    
    
    $
    8,136
    
    
    $
    7,018
    
    
    $
    856Interest cost
    
    
    8,101
    
    
    
    8,835
    
    
    
    24,585
    
    
    
    22,899
    
    
    
    2,798Expected return on plan assets
    
    
    (5,263
    )
    
    
    (5,415
    )
    
    
    (15,932
    )
    
    
    (14,083
    )
    
    
    (1,638
    )Amortization
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    839Net periodic benefit cost
    
    $
    5,522
    
    
    
    6,119
    
    
    $
    16,789
    
    
    $
    15,834
    
    
    $
    2,855
  Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Period
    
    
    PeriodEnded
    
    
    Ended
    
    
    Ended
    
    
    May 6, 2004 to
    
    
    April 1, 2004 toDecember 31, 2005
    
    
    December 31, 2004
    
    
    December 31, 2005
    
    
    December 31, 2004
    
    
    May 5, 2004Service cost
    
    $
    25
    
    
    $
    23
    
    
    $
    75
    
    
    $
    43
    
    
    $
    Interest cost
    
    
    337
    
    
    
    399
    
    
    
    1,005
    
    
    
    1,016
    
    
    
    131Amortization
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (31
    )Net periodic benefit cost
    
    $
    362
    
    
    $
    422
    
    
    $
    1,080
    
    
    $
    1,059
    
    
    $
    100
   11




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(12) ENVIRONMENTAL MATTERS
  (13) COMMITMENTS AND CONTINGENCIES
 Claims Reconciliation
    Historical Federal Plea Agreement
   12




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Pre-Petition Litigation Settlements
  Private Party Lawsuits and other Legal Proceedings
    13




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Environmental Matters
  14
    Table of Contents    .
     Tampa, Florida
  Columbus, Georgia
  15




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##### Table of Contents



Sonalur, Portugal
   Guarantees
   Warranty
   Balance at March 31, 2005
    
    $
    49,030Accrual for warranties provided during the period
    
    
    34,933Settlements made (in cash or credit) during the period
    
    
    (36,274
    )Currency translation
    
    
    (1,791
    )Balance at December 31, 2005
    
    $
    45,898
 (14) RESTRUCTURING AND IMPAIRMENT
   16




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##### Table of Contents



Severance
    
    
    ClosureCosts
    
    
    Costs
    
    
    TotalBalance at March 31, 2005
    
    $
    27,018
    
    
    $
    9,137
    
    
    $
    36,155Charges, Nine Months ended December 31, 2005
    
    
    10,939
    
    
    
    5,112
    
    
    
    16,051Payments and currency translation
    
    
    (27,721
    )
    
    
    (6,924
    )
    
    
    (34,645
    )Balance at December 31, 2005
    
    $
    10,236
    
    
    $
    7,325
    
    
    $
    17,561
  (15) NET INCOME (LOSS) PER SHARE
    (16) RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
    conditional asset retirement
 17




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##### Table of Contents



obligation
 (17) SEGMENT INFORMATION
      For the Three Months Ended December 31, 2005Transportation
    
    
    Industrial EnergyEurope and
    
    
    
    
    
    
    Europe andNorth America
    
    
    ROW
    
    
    North America
    
    
    ROW
    
    
    Other (a)
    
    
    ConsolidatedNet sales
    
    $
    237,650
    
    
    $
    219,709
    
    
    $
    67,292
    
    
    $
    208,791
    
    
    
    
    
    
    $
    733,442Gross profit
    
    
    27,184
    
    
    
    33,646
    
    
    
    14,089
    
    
    
    43,914
    
    
    
    
    
    
    
    118,833Income (loss) before
reorganization items,
income taxes and
minority
interest
    
    
    3,741
    
    
    
    12,402
    
    
    
    (4,245
    )
    
    
    14,343
    
    
    
    (49,028
    )
    
    
    (22,787
    )
 For the Three Months Ended December 31, 2004Transportation
    
    
    Industrial EnergyEurope and
    
    
    
    
    
    
    Europe andNorth America
    
    
    ROW
    
    
    North America
    
    
    ROW
    
    
    Other (a)
    
    
    ConsolidatedNet sales
    
    $
    216,092
    
    
    $
    242,694
    
    
    $
    55,617
    
    
    $
    213,499
    
    
    
    
    
    
    $
    727,902Gross profit
    
    
    33,871
    
    
    
    38,775
    
    
    
    13,661
    
    
    
    39,444
    
    
    
    
    
    
    
    125,751Income (loss) before
reorganization items,
income taxes and
minority
Interest
    
    
    (108,949
    )
    
    
    (103,283
    )
    
    
    (30,424
    )
    
    
    (106,564
    )
    
    
    (53,221
    )
    
    
    (402,441
    )
 18




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##### Table of Contents



For the Nine Months Ended December 31, 2005Transportation
    
    
    Industrial EnergyEurope and
    
    
    
    
    
    
    Europe andNorth America
    
    
    ROW
    
    
    North America
    
    
    ROW
    
    
    Other (a)
    
    
    ConsolidatedNet sales
    
    $
    681,799
    
    
    $
    587,054
    
    
    $
    207,770
    
    
    $
    612,636
    
    
    
    
    
    
    $
    2,089,259Gross profit
    
    
    86,580
    
    
    
    76,311
    
    
    
    41,140
    
    
    
    120,911
    
    
    
    
    
    
    
    324,942Income (loss) before
reorganization items,
income taxes and
minority
interest
    
    
    11,399
    
    
    
    15,226
    
    
    
    5,118
    
    
    
    31,341
    
    
    
    (152,432
    )
    
    
    (89,348
    )
 For the Period May 6, 2004 to December 31, 2004Transportation
    
    
    Industrial EnergyEurope and
    
    
    
    
    
    
    Europe andNorth America
    
    
    ROW
    
    
    North America
    
    
    ROW
    
    
    Other (a)
    
    
    ConsolidatedNet sales
    
    $
    567,720
    
    
    $
    539,080
    
    
    $
    141,166
    
    
    $
    515,463
    
    
    
    
    
    
    $
    1,763,429Gross profit
    
    
    83,984
    
    
    
    80,071
    
    
    
    32,567
    
    
    
    88,940
    
    
    
    
    
    
    
    285,562Income (loss) before
reorganization items,
income taxes and
minority
interest
    
    
    (99,058
    )
    
    
    (95,265
    )
    
    
    (24,835
    )
    
    
    (103,453
    )
    
    
    (63,542
    )
    
    
    (386,153
    )
 For the Period April 1, 2004 to May 5, 2004Transportation
    
    
    Industrial EnergyEurope and
    
    
    
    
    
    
    Europe andNorth America
    
    
    ROW
    
    
    North America
    
    
    ROW
    
    
    Other (a)
    
    
    ConsolidatedNet sales
    
    $
    75,299
    
    
    $
    58,927
    
    
    $
    19,193
    
    
    $
    61,188
    
    
    
    
    
    
    $
    214,607Gross profit
    
    
    11,121
    
    
    
    7,850
    
    
    
    4,775
    
    
    
    11,724
    
    
    
    
    
    
    
    35,470Income (loss) before
reorganization items,
income taxes and
minority
interest
    
    
    2,413
    
    
    
    691
    
    
    
    1,607
    
    
    
    1,914
    
    
    
    (29,293
    )
    
    
    (22,668
    )
 
 (a)
    
    Other includes shared services and corporate
expenses, interest expense, net, currency
remeasurement losses (gains), and gains on
revaluation of Warrants.(b)
    
    For the three months and nine months ended December
31, 2005, gross profit and income (loss) before
reorganization items, income taxes and minority
interest for Transportation North America and
Industrial Energy North America reflect a change in
the allocation of lead costs between the two
segments as compared to the prior period. The
amounts for Industrial Energy North America would
have been higher and Transportation North America
lower by $1,614 and $4,643, respectively, if the
allocation change had not been made. (18) STOCK-BASED COMPENSATION PLANS
  19




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Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Period
    
    
    PeriodEnded
    
    
    Ended
    
    
    Ended
    
    
    May 6, 2004 to
    
    
    April 1, 2004 toDecember 31, 2005
    
    
    December 31, 2004
    
    
    December 31, 2005
    
    
    December 31, 2004
    
    
    May 5, 2004Net income (loss), as reported
    
    $
    (27,658
    )
    
    $
    (439,040
    )
    
    $
    (96,390
    )
    
    $
    (422,514
    )
    
    $
    1,748,564Less: stock based compensation expense
determined under the fair value based
method
    
    
    (337
    )
    
    
    
    
    
    
    (810
    )
    
    
    
    
    
    
    (86
    )Pro forma, net income (loss)
    
    $
    (27,995
    )
    
    $
    (439,040
    )
    
    $
    (97,200
    )
    
    $
    (422,514
    )
    
    $
    1,748,478Basic and diluted net income (loss) per
shareAs reported
    
    $
    (1.11
    )
    
    $
    (17.56
    )
    
    $
    (3.86
    )
    
    $
    (16.90
    )
    
    $
    63.86Pro forma
    
    $
    (1.12
    )
    
    $
    (17.56
    )
    
    $
    (3.88
    )
    
    $
    (16.90
    )
    
    $
    63.85
 (19) SUBSEQUENT EVENTS
  
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations   (In thousands, except per share data)
   Executive Overview
    Factors Which Affect the Companys Financial Performance
 Lead and other Raw Materials.
 20




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Energy Costs.
 Competition
 Exchange Rates
 Markets
 Seasonality and weather.
  Interest rates.
 Third Quarter of Fiscal 2006 Highlights and Outlook
    21




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Critical Accounting Policies and Estimates
     Results of Operations  Three months ended December 31, 2005 compared with three months ended December 31, 2004
 Overview
  22




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Gross Profit
      Expenses
  23




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Reorganization items
  24




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Income Taxes
  Nine months ended December 31, 2005 compared with nine months ended December 31, 2004
 Overview
  Net Sales
      Gross Profit
    25




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Expenses
        26




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Reorganization items
  Gain on discharge of liabilities subject to compromise
  Fresh Start accounting adjustments, net
  Income Taxes
  Liquidity and Capital Resources
    27




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28




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Sources of Cash
     Uses of Cash
      29




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Financial Instruments and Market Risk
   Accounts Receivable Factoring Arrangements
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risks
  
 Item 4. Controls and Procedures  Evaluation of Disclosure Controls and Procedures
    Changes in Internal Control Over Financial Reporting
  30




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
    
    We are enhancing established policies and procedures for accounting
review of month-end close, account reconciliation processes, journal
entries, write-offs, restructuring related entries, impairment reviews
and tax related entries. These policies and procedures among many
others have been codified in a Global Financial Manual that was rolled
out in early November, 2005, and;
    
    We have taken steps to reduce the complexity of our consolidation
processes, including push-down of responsibility for current
consolidation activities to the appropriate levels in the
organization.
  
    
    Improving our documentation and training related to policies and procedures for the controls related to
our significant accounts and processes;
    
    We have finalized an update of our documentation of key controls in most major operating locations of
the Company and expect to complete this process early in the fourth fiscal quarter.
    
    Detailed testing of compliance with identified key controls has been carried out throughout the third
quarter and identified exceptions have been and will continue to be remediated in advance of further
scheduled testing in our fiscal fourth quarter.
    
    We have hired additional accounting personnel to focus on our ongoing remediation initiatives and
compliance efforts;
    
    Engaging expert resources to assist with worldwide tax planning and compliance;
    
    Re-allocating and/or relocating duties of finance personnel to enhance review and monitoring procedures.
  31




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CAUTIONARY STATEMENT FOR PURPOSES OF THE SAFE HARBOR
PROVISION OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
     32




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PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  
 Item 6. Exhibits
 10.1
    
    
    Sixth Amendment and Covenant to
Credit Agreement, dated as of January 25, 2006, among Exide
Technologies, a Delaware corporation, Exide Global Holding
Netherlands C.V., a limited partnership organized under the laws of
the Netherlands, the lenders party thereto, and Deutsche Bank AG New
York Branch, as Administrative Agent, incorporated by reference to
Exhibit 99.1 to the Companys Report on 8-K dated
February 1, 2006.10.2
    
    
    Performance Unit Award Summary
Document, incorporated by reference to Exhibit 10.1 to the
Companys Report on 8-K dated December 1, 2005.10.3
    
    
    Form of Exide Technologies Employee
Performance Unit Award Agreement, incorporated by reference to
Exhibit 10.2 to the Companys Report on 8-K dated
December 1, 2005.31.1
    
    
    Certification of Gordon Ulsh, President and Chief Executive Officer,
pursuant to Section 302 of Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of Phillip A. Damaska, Acting Chief Financial Officer
and Vice President Corporate Controller, pursuant to Section 302 of
Sarbanes-Oxley Act of 2002.32
    
    
    Certifications pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
 33




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SIGNATURES
  Date: February 9, 2006

    EXIDE TECHNOLOGIESBy:
    /S/ Phillip A. DamaskaPhillip A. DamaskaActing Chief Financial Officer and
Vice President Corporate Controller 34