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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 FORM 10-Q
  ý
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 March 31, 2011
 oro
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 
  ENCORE WIRE CORPORATION
  Delaware
    
    75-2274963(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)1329 Millwood RoadMcKinney, Texas
    
    75069(Address of principal executive offices)
    
    (Zip Code)
 (972) 562-9473
 N/A  (Former name, former address and former fiscal year, if changed since last report)
 ý
   Large accelerated filer [  ]
    
    Accelerated filer ýNon-accelerated filer    [  ] (Do not check if a smaller reporting company)
    
    Smaller reporting company [  ]
  ý




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ENCORE WIRE CORPORATION
 FORM 10-Q
 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2011
 Page No.PART IFINANCIAL INFORMATIONItem 1. Financial Statements.Consolidated Balance Sheets
March 31, 2011 (Unaudited) and December 31, 2010
    
    
    1Consolidated Statements of Operations (Unaudited)
Quarters ended March 31, 2011 and March 31, 2010
    
    
    3Consolidated Statements of Cash Flows (Unaudited)
Quarters ended March 31, 2011 and March 31, 2010
    
    
    4Notes to Consolidated Financial Statements
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition
and Results of Operations.
    
    
    9Item 3. Quantitative and Qualitative Disclosures About Market Risk.
    
    
    13Item 4. Controls and Procedures.
    
    
    13PART IIOTHER INFORMATIONItem 1. Legal Proceedings.
    
    
    14Item 1A. Risk Factors.
    
    
    14Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
    
    
    14Item 6. Exhibits.
    
    
    14Signatures
    
    
    15EX-31.1EX-31.2EX-32.1EX-32.2




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PART IFINANCIAL INFORMATION
 
 Item 1. Financial Statements
  
  March 31,
    
    
    December 31,In Thousands of Dollars
    
    2011
    
    
    2010(Unaudited)
    
    
    (See Note)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    75,233
    
    
    $
    103,252Accounts receivable (net of allowance 
of $2,582 and $2,582)
    
    
    234,851
    
    
    
    190,364Inventories
    
    
    47,974
    
    
    
    42,104Current deferred income taxes
    
    
    6,915
    
    
    
    4,485Prepaid expenses and other
    
    
    2,578
    
    
    
    1,892Total current assets
    
    
    367,551
    
    
    
    342,097Property, plant and equipment - at cost:Land and land improvements
    
    
    17,971
    
    
    
    17,971Construction-in-progress
    
    
    12,954
    
    
    
    15,564Buildings and improvements
    
    
    69,920
    
    
    
    69,440Machinery and equipment
    
    
    179,136
    
    
    
    174,916Furniture and fixtures
    
    
    7,133
    
    
    
    7,066Total property, plant and equipment
    
    
    287,114
    
    
    
    284,957Accumulated depreciation
    
    
    (153,288
    )
    
    
    (149,972
    )Property, plant and equipment - net
    
    
    133,826
    
    
    
    134,985Other assets
    
    
    622
    
    
    
    194Total assets
    
    $
    501,999
    
    
    $
    477,276
 Note:
    
    The consolidated balance sheet at December 31, 2010, as presented, is
derived from the audited consolidated financial statements at that date.
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March 31,
    
    
    December 31,In
Thousands of Dollars, Except Share Data
    
    2011
    
    
    2010(Unaudited)
    
    
    (See Note)LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Trade accounts payable
    
    $
    46,975
    
    
    $
    32,897Accrued liabilities
    
    
    18,030
    
    
    
    23,191Current income taxes payable
    
    
    7,485
    
    
    
    2,065Total current liabilities
    
    
    72,490
    
    
    
    58,153Non-current deferred income taxes
    
    
    11,766
    
    
    
    11,746Commitments and contingenciesStockholders equity:Preferred stock, $.01 par value:Authorized shares  2,000,000; none issued
     
    
    
    
    
    
    Common stock, $.01 par value:Authorized shares  40,000,000;
Issued shares  26,371,752 and 26,366,752
    
    
    264
    
    
    
    264Additional paid-in capital
    
    
    45,217
    
    
    
    45,040Treasury stock, at cost  3,150,277 and 3,150,277 shares
    
    
    (21,294
    )
    
    
    (21,294
    )Retained earnings
    
    
    393,556
    
    
    
    383,367Total stockholders equity
    
    
    417,743
    
    
    
    407,377Total liabilities and stockholders equity
    
    $
    501,999
    
    
    $
    477,276
 Note:
    
    The consolidated balance sheet at December 31, 2010, as presented, is
derived from the audited consolidated financial statements at that date.
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Quarter EndedMarch 31,In Thousands, Except Per Share Data
    
    2011
    
    
    2010Net sales
    
    $
    303,351
    
    
    $
    175,229Cost of goods sold
    
    
    269,596
    
    
    
    164,628Gross profit
    
    
    33,755
    
    
    
    10,601Selling, general, and administrative expenses
    
    
    18,149
    
    
    
    11,985Operating income (loss)
    
    
    15,606
    
    
    
    (1,384
    )Net interest and other (income) expense
    
    
    (6
    )
    
    
    2,702Income (loss) before income taxes
    
    
    15,612
    
    
    
    (4,086
    )Provision (benefit) for income taxes
    
    
    4,958
    
    
    
    (1,620
    )Net income (loss)
    
    $
    10,654
    
    
    $
    (2,466
    )Net income (loss) per common and common
equivalent share  basic
    
    $
    0.46
    
    
    $
    (0.11
    )Weighted average common and common
equivalent shares  basic
    
    
    23,217
    
    
    
    23,159Net income (loss) per common and common
equivalent share  diluted
    
    $
    0.46
    
    
    $
    (0.11
    )Weighted average common and common
equivalent shares  diluted
    
    
    23,378
    
    
    
    23,159Cash dividends declared per share
    
    $
    0.02
    
    
    $
    0.02
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Quarters EndedMarch 31,In Thousands of Dollars
    
    2011
    
    
    2010OPERATING ACTIVITIESNet income (loss)
    
    $
    10,654
    
    
    $
    (2,466
    )Adjustments to reconcile net income (loss) to net cash 
provided by (used in) operating activities:
    
    
    3,425
    
    
    
    3,473Depreciation and amortizationDeferred income taxes
    
    
    (2,410
    )
    
    
    (3,249
    )Other
    
    
    109
    
    
    
    (251
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    (44,487
    )
    
    
    (9,439
    )Inventories
    
    
    (5,870
    )
    
    
    10,033Trade accounts payable and accrued liabilities
    
    
    8,917
    
    
    
    14,558Other assets and liabilities
    
    
    (1,122
    )
    
    
    (6,990
    )Current income taxes receivable / payable
    
    
    5,419
    
    
    
    1,538NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
    
    
    (25,365
    )
    
    
    7,207INVESTING ACTIVITIESPurchases of property, plant and equipment
    
    
    (2,258
    )
    
    
    (3,150
    )Proceeds from sale of assets
    
    
    11
    
    
    
    10NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
    
    
    (2,247
    )
    
    
    (3,140
    )FINANCING ACTIVITIESRepayment of notes payable
    
    
    
    
    
    
    (100,000
    )Deferred financing fees
    
    
    
    
    
    
    (50
    )Proceeds from issuances of common stock
    
    
    57
    
    
    
    34Dividend paid
    
    
    (464
    )
    
    
    (464
    )NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
    
    
    (407
    )
    
    
    (100,480
    )Net increase (decrease) in cash and cash equivalents
    
    
    (28,019
    )
    
    
    (96,413
    )Cash and cash equivalents at beginning of period
    
    
    103,252
    
    
    
    226,769Cash and cash equivalents at end of period
    
    $
    75,233
    
    
    $
    130,356
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March 31,
    
    
    December 31,In Thousands of Dollars
    
    2011
    
    
    2010Raw materials
    
    $
    27,094
    
    
    $
    27,092Work-in-process
    
    
    24,033
    
    
    
    19,889Finished goods
    
    
    91,922
    
    
    
    81,940143,049
    
    
    
    128,921Adjust to LIFO cost
    
    
    (95,075
    )
    
    
    (86,817
    )Lower of cost or market adjustment
    
    
    
    
    
    
    $
    47,974
    
    
    $
    42,104
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March 31,
    
    
    December 31,In Thousands of Dollars
    
    2011
    
    
    2010Sales volume discounts payable
    
    $
    12,629
    
    
    $
    14,997Property taxes payable
    
    
    678
    
    
    
    2,648Commissions payable
    
    
    2,989
    
    
    
    2,290Accrued salaries
    
    
    1,097
    
    
    
    2,591Other accrued liabilities
    
    
    637
    
    
    
    665$
    18,030
    
    
    $
    23,191
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Quarters EndedMarch 31,
    
    
    March 31,In Thousands
    
    2011
    
    
    2010Numerator:Net income (loss)
    
    $
    10,654
    
    
    $
    (2,466
    )Denominator:Denominator for basic
earnings per share 
weighted average
shares
    
    
    23,217
    
    
    
    23,159Effect of dilutive securities:Employee stock options
    
    
    161
    
    
    
    Denominator for diluted earnings per share
 weighted average shares
    
    
    23,378
    
    
    
    23,159
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AP
 inter partes
 8




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Item 2.  Managements Discussion and Analysis of Financial Condition and Results of Operations.
 General
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Results of Operations
 Quarter Ended March 31, 2011 Compared to Quarter Ended March 31, 2010
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Liquidity and Capital Resources
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Information Regarding Forward Looking Statements
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risk.
  
 Item 4. Controls and Procedures.
  13




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PART IIOTHER INFORMATION
 
 Item 1. Legal Proceedings.
  
 Item 1A. Risk Factors.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
  
 Item 6. Exhibits.
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ENCORE WIRE CORPORATION(Registrant)Dated: May 5, 2011
    
    /s/ DANIEL L. JONESDaniel L. Jones, President andChief Executive OfficerDated: May 5, 2011
    
    /s/ FRANK J. BILBANFrank J. Bilban, Vice President  Finance,Chief Financial Officer,Treasurer and Secretary
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##### Table of Contents



ExhibitNumber
    
    
    Description3.1
    
    
    Certificate of Incorporation of Encore Wire Corporation and all
amendments thereto (filed as Exhibit 3.1 to the Companys
Quarterly Report on Form 10-Q for the quarter ended March 31,
2009, and incorporated herein by reference).3.2
    
    
    Second Amended and Restated Bylaws of Encore Wire Corporation, as
amended through December 13, 2007 (filed as Exhibit 3.2 to the
Companys Annual Report on Form 10-K for the year ended December
31, 2007, and incorporated herein by reference).31.1
    
    
    Certification by Daniel L. Jones, President and Chief Executive
Officer of the Company, dated May 5, 2011 and submitted pursuant
to Rule 13a-14(a)/15d-14(a) and pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification by Frank J. Bilban, Vice President  Finance,
Treasurer, Secretary and Chief Financial Officer of the Company,
dated May 5, 2011 and submitted pursuant to Rule
13a-14(a)/15d-14(a) and pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification by Daniel L. Jones, President and Chief Executive
Officer of the Company, dated May 5, 2011 as required by 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification by Frank J. Bilban, Vice President  Finance,
Treasurer, Secretary and Chief Financial Officer, dated May 5, 2011 as required by 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.