##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION Washington, DC 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, 2004. OR 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 001-14617 ANDREW CORPORATION  DELAWARE
    
    36-2092797(State or other jurisdiction of incorporation or organization)
    
    (IRS Employer identification No.)
 10500 W. 153rd Street, Orland Park, Illinois 60462
(Address of principal executive offices and zip code) (708) 349-3300
(Registrants telephone number, including area code) No Change
(Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period as the Registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes þ No o Indicate by check mark whether the registrant is an accelerated filer (as defined in rule 12b-2 of
the Act) Yes þ No o Indicate the number of shares outstanding of each of the issuers classes of common stock, as of
the latest practical date. Common Stock, $.01 Par Value  160,998,465 shares as of February 04, 2005   1




---



##### Table of Contents



INDEX
ANDREW CORPORATION PART I. FINANCIAL INFORMATIONItem 1. Financial Statements (Unaudited)Consolidated Balance Sheets December 31, 2004 and September 30, 2004Consolidated Statements of Operations Three months ended December 31, 2004
and 2003Consolidated Statements of Cash Flows Three months ended December 31, 2004
and 2003Notes to Consolidated Financial Statements December 31, 2004Item 2. Managements Discussion and Analysis of Financial Condition and Results of
OperationsItem 3. Quantitative and Qualitative Disclosures About Market RiskItem 4. Controls and ProceduresPART II. OTHER INFORMATIONItem 1. Legal ProceedingsItem 2. Unregistered Sales of Equity Securities and Use of ProceedsItem 6. ExhibitsSIGNATURECERTIFICATIONSCertification of CEO and CFOSection 1350 Certifications of CEO and CFO
 2




---



##### Table of Contents



ITEM 1. FINANCIAL STATEMENTS ANDREW CORPORATION 
 CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share amounts)
 December 31
    
    
    September 302004
    
    
    2004(UNAUDITED)ASSETSCurrent AssetsCash and cash equivalents
    
    $
    179,421
    
    
    $
    189,048Accounts receivable, less allowances (Dec. 2004 - $14,379; Sept. 2004 - $13,798)
    
    
    447,227
    
    
    
    416,603Inventories
    
    
    356,481
    
    
    
    351,082Other current assets
    
    
    45,936
    
    
    
    34,190Total Current Assets
    
    
    1,029,065
    
    
    
    990,923Other AssetsGoodwill
    
    
    872,034
    
    
    
    868,078Intangible assets, less amortization
    
    
    62,401
    
    
    
    63,988Other assets
    
    
    89,148
    
    
    
    92,590Property, Plant, and EquipmentLand and land improvements
    
    
    23,584
    
    
    
    22,607Buildings
    
    
    128,192
    
    
    
    123,716Equipment
    
    
    514,401
    
    
    
    496,739Allowance for depreciation
    
    
    (430,051
    )
    
    
    (417,696
    )236,126
    
    
    
    225,366TOTAL ASSETS
    
    $
    2,288,774
    
    
    $
    2,240,945LIABILITIES AND SHAREHOLDERS EQUITYCurrent LiabilitiesAccounts payable
    
    $
    201,428
    
    
    $
    196,592Accrued expenses and other liabilities
    
    
    86,736
    
    
    
    82,291Compensation and related expenses
    
    
    44,318
    
    
    
    67,018Restructuring
    
    
    21,431
    
    
    
    18,887Notes payable and current portion of long-term debt
    
    
    23,226
    
    
    
    14,051Total Current Liabilities
    
    
    377,139
    
    
    
    378,839Deferred liabilities
    
    
    54,030
    
    
    
    54,388Long-term debt,less current portion
    
    
    280,265
    
    
    
    284,844SHAREHOLDERS EQUITYRedeemable convertible preferred stock liquidation preference $50 a share (119,114 shares
outstanding at December 31, 2004 and 120,414 shares outstanding at September 30, 2004)
    
    
    5,956
    
    
    
    6,021Common stock (par value, $.01 a share: 400,000,000 shares authorized: 161,024,089 shares
issued at Dec. 31, 2004 and 161,015,917 shares issued at Sept. 30, 2004, including treasury)
    
    
    1,610
    
    
    
    1,610Additional paid-in capital
    
    
    667,348
    
    
    
    666,746Accumulated other comprehensive income
    
    
    50,406
    
    
    
    12,363Retained earnings
    
    
    852,338
    
    
    
    837,713Treasury stock, common stock at cost (29,723 shares at December 30, 2004 and
148,950 shares at September 30, 2004)
    
    
    (318
    )
    
    
    (1,579
    )Total Shareholders Equity
    
    
    1,577,340
    
    
    
    1,522,874TOTAL LIABILITIES AND SHAREHOLDERS EQUITY
    
    $
    2,288,774
    
    
    $
    2,240,945
 See Notes to Consolidated Financial Statements 3




---



##### Table of Contents



ANDREW CORPORATION 
 CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollars and shares outstanding in thousands, except per share amounts)
 Three Months EndedDecember 312004
    
    
    2003Sales
    
    $
    474,074
    
    
    $
    410,771Cost of products sold
    
    
    363,667
    
    
    
    306,702Gross Profit
    
    
    110,407
    
    
    
    104,069Operating ExpensesResearch and development
    
    
    26,871
    
    
    
    25,623Sales and administrative
    
    
    51,029
    
    
    
    52,493Intangible amortization
    
    
    7,740
    
    
    
    9,421Restructuring
    
    
    1,838
    
    
    
    694Loss on sale of assets
    
    
    
    
    
    
    4,51187,478
    
    
    
    92,742Operating Income
    
    
    22,929
    
    
    
    11,327OtherInterest expense
    
    
    3,708
    
    
    
    3,887Interest income
    
    
    (1,706
    )
    
    
    (749
    )Other expense
    
    
    1,516
    
    
    
    1,8503,518
    
    
    
    4,988Income Before Income Taxes
    
    
    19,411
    
    
    
    6,339Income Taxes
    
    
    4,669
    
    
    
    2,219Net Income
    
    
    14,742
    
    
    
    4,120Preferred Stock Dividends
    
    
    117
    
    
    
    315Net Income Available to Common Shareholders
    
    $
    14,625
    
    
    $
    3,805Basic and Diluted Net Income per Share
    
    $
    0.09
    
    
    $
    0.02Average Shares OutstandingBasic
    
    
    160,927
    
    
    
    158,345Diluted
    
    
    180,319
    
    
    
    158,642
 See Notes to Consolidated Financial Statements 4




---



##### Table of Contents



ANDREW CORPORATION 
 CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(Dollars in thousands)
 Three Months EndedDecember 312004
    
    
    2003Cash Flows from OperationsNet Income
    
    $
    14,742
    
    
    $
    4,120Adjustments to Net IncomeDepreciation
    
    
    14,392
    
    
    
    15,219Amortization
    
    
    7,740
    
    
    
    9,421Gain on sale of assets
    
    
    (91
    )
    
    
    (90
    )Restructuring costs
    
    
    (3,308
    )
    
    
    (6,281
    )Change in Operating Assets/LiabilitiesAccounts receivable
    
    
    (12,476
    )
    
    
    (38,863
    )Inventories
    
    
    2,649
    
    
    
    (26,646
    )Other assets
    
    
    (9,756
    )
    
    
    (4,638
    )Accounts payable and other liabilities
    
    
    (32,665
    )
    
    
    32,092Net Cash Used for Operations
    
    
    (18,773
    )
    
    
    (15,666
    )Investing ActivitiesCapital expenditures
    
    
    (14,036
    )
    
    
    (19,573
    )Acquisition of businesses, net of cash acquired
    
    
    (7,872
    )
    
    
    (23,227
    )Investments
    
    
    
    
    
    
    (6,500
    )Proceeds from sale of businesses and investments
    
    
    9,494
    
    
    
    3,000Proceeds from sale of property, plant and equipment
    
    
    553
    
    
    
    549Net Cash Used for Investing Activities
    
    
    (11,861
    )
    
    
    (45,751
    )Financing ActivitiesLong-term debt payments, net
    
    
    (325
    )
    
    
    (11,691
    )Notes payable borrowings (payments), net
    
    
    9,064
    
    
    
    (174
    )Preferred stock dividends
    
    
    (117
    )
    
    
    (315
    )Payments to acquire common stock for treasury
    
    
    
    
    
    
    (2,472
    )Stock purchase and option plans
    
    
    184
    
    
    
    636Net Cash From (Used for) Financing Activities
    
    
    8,806
    
    
    
    (14,016
    )Effect of exchange rate changes on cash
    
    
    12,201
    
    
    
    9,280Decrease for the Period
    
    
    (9,627
    )
    
    
    (66,153
    )Cash and Equivalents at Beginning of Period
    
    
    189,048
    
    
    
    286,269Cash and Equivalents at End of Period
    
    $
    179,421
    
    
    $
    220,116
 See Notes to Consolidated Financial Statements 5




---



##### Table of Contents



ANDREW CORPORATION 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 1. BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements have been prepared in accordance with
U.S. generally accepted accounting principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all
of the information and footnotes required by U.S. generally accepted accounting principles for
complete financial statements. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been included. Operating
results for the three month period ended December 31, 2004 are not necessarily indicative of the
results that may be expected for the year ending September 30, 2005. For further information,
refer to the consolidated financial statements and footnotes thereto included in the companys
annual report on Form 10-K for the year ended September 30, 2004. NOTE 2. EARNINGS PER SHARE The following table sets forth the computation of basic and diluted earnings per share: Three Months EndedIn thousands, except per share amounts
    
    December 312004
    
    
    2003BASIC EARNINGS PER SHARENet income
    
    $
    14,742
    
    
    $
    4,120Preferred stock dividends
    
    
    117
    
    
    
    315Net income available to common shareholders
    
    
    14,625
    
    
    
    3,805Average basic shares outstanding
    
    
    160,927
    
    
    
    158,345Basic net income per share
    
    $
    0.09
    
    
    $
    0.02DILUTED EARNINGS PER SHARENet income
    
    $
    14,742
    
    
    $
    4,120Preferred stock dividends
    
    
    117
    
    
    
    315Net income available to common shareholders
    
    
    14,625
    
    
    
    3,805Effect of dilutive securities:Interest, net of taxes on convertible notes
    
    
    1,328
    
    
    
    Preferred stock dividends
    
    
    117
    
    
    
    Net income available to common shareholdersAfter assumed conversions
    
    
    16,070
    
    
    
    3,805Average basic shares outstanding
    
    
    160,927
    
    
    
    158,345Effect of dilutive securities:Options, warrants, and equivalents
    
    
    480
    
    
    
    297Convertible notes
    
    
    17,532
    
    
    
    Convertible preferred stock
    
    
    1,380
    
    
    
    Average diluted shares outstanding
    
    
    180,319
    
    
    
    158,642Diluted net income per share
    
    $
    0.09
    
    
    $
    0.02
 6




---



##### Table of Contents



For the quarter ended December 31, 2004 the company had an average of 119,764 shares of
convertible preferred stock outstanding, which were convertible into 1,380,400 shares of common
stock, which were used in the diluted earning per share calculation. For the quarter ended December
31, 2003, the company had an average of 160,814 shares of convertible preferred stock outstanding,
which were convertible into 1,853,542 shares of common stock. . These shares were not included in
the calculation of diluted earnings per share for the three months ended December 31, 2003 because
including these shares and excluding the convertible preferred stock dividends would have increased
reported diluted earnings per share. The companys convertible subordinated notes are potentially convertible into 17,531,568 shares of
the companys common stock. These shares were not included in the calculation of diluted earnings
per share for the three months ended December 31, 2003 because including these shares and excluding
the interest expense on these notes would have increased reported diluted earnings per share. Options to purchase 7,931,743 and 5,330,272 shares of common stock at December 31, 2004 and 2003,
respectively, were not included in the computation of diluted shares because the options exercise
prices were greater than the average market price of the common shares. NOTE 3. INVENTORIES Inventories consisted of the following at December 31, 2004 and September 30, 2004, net of
reserves: December 31
    
    
    September 30(Dollars in thousands)
    
    2004
    
    
    2004Raw materials
    
    $
    121,287
    
    
    $
    133,483Work in process
    
    
    96,324
    
    
    
    85,917Finished goods
    
    
    138,870
    
    
    
    131,682$
    356,481
    
    
    $
    351,082
 NOTE 4. COMPREHENSIVE INCOME Statement of Financial Accounting Standards (SFAS) No. 130, Reporting Comprehensive Income,
requires the company to report foreign currency translation adjustments included in Accumulated
Other Comprehensive Income, a component of shareholders equity, as comprehensive income. For the
three months ended December 31, 2004 and 2003, other comprehensive income is made up of net income
available to common shareholders and foreign currency translation adjustments. Comprehensive
income for the periods ended December 31, 2004 and 2003 was as follows: Three months endedDecember 31(Dollars in thousands)
    
    2004
    
    
    2003Net income
    
    $
    14,742
    
    
    $
    4,120Foreign currency translation adjustments
    
    
    38,043
    
    
    
    27,731Comprehensive Income
    
    $
    52,785
    
    
    $
    31,851
 7




---



##### Table of Contents



NOTE 5. RECENTLY ISSUED ACCOUNTING POLICIES In December 2004, the Financial Accounting Standards Board (FASB) issued revised Statement of
Financial Accounting Standards (SFAS) No.123(R), Share-Based Payment, which requires the company to
record compensation cost for all share-based payments, including employee stock options, at fair
value beginning in the quarter ending September 30, 2005. As permitted by Statement 123, the
company currently accounts for share-based payments to employees using the intrinsic value method
as prescribed by Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to
Employees,and generally recognizes no compensation cost for employee stock options because the
exercise price of these stock options equals the market price of the underlying stock on the date
of the grant. Accordingly, the adoption of Statement 123(R)s fair value method could have a
significant impact on our results of operations. The impact of adoption of Statement 123(R) cannot
be predicted at this time because it will depend on levels of share-based payments granted in the
future. However, assuming no additional stock options are granted, the company estimates that the
unvested stock options expected to be outstanding at the date of adoption will result in after-tax
charges of approximately $0.8 million in the fourth quarter of 2005 and $2.9 million in fiscal year
2006. Statement 123(R) also requires the benefits of tax deductions in excess of recognized
compensation cost to be reported as a financing cash flow, rather than as an operating cash flow as
required under current literature. This requirement will reduce net operating cash flows and
increase net financing cash flows in periods after adoption. While the company cannot estimate
what those amounts will be in the future (because they depend on, among other things, when
employees exercise stock options), operating cash flows recognized in prior periods for such excess
tax deductions were approximately $900,000 and $85,000 in fiscal year 2004 and 2003, respectively. On October 22, 2004, the President signed into law the American Jobs Creation Act of 2004. The Act
includes a temporary incentive for U.S. corporations to repatriate accumulated income earned abroad
by providing an 85 percent dividends-received deduction for certain qualifying cash dividends
received from controlled foreign corporations. The deduction is subject to certain limitations
and, as of today, uncertainty remains as to how certain provisions of the Act will be interpreted.
Therefore, the company is not yet in a position to determine whether, and to what extent, it would
repatriate unremitted foreign earnings. The company expects to finalize its analysis of these
provisions by June 30, 2005. NOTE 6. ADOPTION OF NEW ACCOUNTING POLICIES In September 2004, the FASB issued EITF No. 04-08, The Effect of Contingently Convertible Debt on
Diluted Earnings per Share.EITF No. 04-08 requires the company to include the impact of the
companys contingently convertible notes in the diluted earnings per share calculations, regardless
of whether the conversion contingency has been met. This contrasts with previous accounting rules,
which allowed companies to exclude contingent convertibles from the calculation of diluted earnings
per share, if the contingency has not been met. The company adopted EITF No. 04-08 starting in
fiscal year 2005. EITF No. 04-08 includes a requirement to restate all periods during which the
convertible instrument was outstanding. The company has determined that no prior period
restatements are required because the contingently convertible notes were anti-dilutive in these
periods. 8




---



##### Table of Contents



NOTE 7. RESTRUCTURING AND INTEGRATION At December 31, 2004, the company had a restructuring reserve of $21.4 million, comprised of $5.4
million for its restructuring plans and $16.0 million for merger integration plans. Restructuring Reserve The company initiated restructuring plans in 2002. As part of these initiatives, the company has
consolidated its operations into fewer, more efficient facilities and opened two new manufacturing
facilities in Mexico and the Czech Republic. In the first quarter of 2005, the company incurred
cash costs of $1.9 million under these initiatives, consisting of $1.5 million of severance paid to
126 employees and lease payments of $0.4 million. At December 31, 2004 the company had a reserve of
$5.4 million for lease cancellation costs that are scheduled to continue through 2007. A summary of
the restructuring reserve activity is provided below (dollars in thousands): Reserve
    
    
    
    
    
    
    ReserveBalance
    
    
    
    
    
    
    BalanceSeptember
    
    
    Utilization
    
    December30, 2004
    
    
    of Reserve

    
    31, 2004Restructuring Reserve Activity for the
three months ended December 31, 2004Severance
    
    $
    1,502
    
    
    
    ($1,502
    )
    
    $
    Lease cancellation and other costs
    
    
    5,836
    
    
    
    (430
    )
    
    
    5,406Total Restructuring Reserve Balance
    
    $
    7,338
    
    
    
    ($1,932
    )
    
    $
    5,406
 Merger Integration Reserve As part of the 2003 Allen Telecom acquisition, the company accrued a restructuring reserve for
costs to integrate Allens operations with those of the company and to eliminate duplicate
operations. At September 30, 2004 the Allen integration reserve was $11.5 million. In the first
quarter of fiscal 2005, the company incurred cash costs of $1.4 million consisting of severance of
$0.9 million paid to 43 employees and $0.5 million of lease cancellation and other costs. In the first quarter of fiscal 2005, the company completed the development of its merger
integration plan for Channel Master LLC, which was acquired in fiscal year 2004. The company
accrued $5.9 million to close Channel Masters U.S. manufacturing facility and relocate these
operations to China and Mexico. As part of this plan, the company expects to pay severance benefits
to approximately 300 employees and plans to complete the relocation of manufacturing operations by
the end of fiscal year 2006. The $5.9 million was treated as a purchase accounting adjustment and
was recorded as an increase in the value of net assets acquired. A summary of the merger integration reserve activity is provided below (dollars in thousands): Reserve
    
    
    
    
    
    
    
    
    
    
    ReserveBalance
    
    
    
    
    
    
    
    
    
    
    BalanceSeptember
    
    
    Utilization
    
    
    
    
    
    December30, 2004
    
    
    of Reserve
    
    Accrual
    


31, 2004Integration Reserve Activity for the
three months ended December 31, 2004Severance
    
    $
    6,279
    
    
    ($
    858
    )
    
    $
    2,262
    
    
    $
    7,683Lease cancellation and other costs
    
    
    5,270
    
    
    
    (546
    )
    
    
    3,618
    
    
    
    8,342Total Integration Reserve Balance
    
    $
    11,549
    
    
    ($
    1,404
    )
    
    $
    5,880
    
    
    $
    16,025
 In the first quarter of fiscal 2005, the company recognized $1.8 million of restructuring expense
for severance and other costs incurred as part of the companys integration plans and other cost
cutting initiatives that were expensed as incurred. 9




---



##### Table of Contents



NOTE 8. STOCK-BASED COMPENSATION The company accounts for stock-based compensation awards pursuant to Accounting Principles Board
Opinion No. 25 and its related interpretations which prescribe the use of the intrinsic value
method. Accordingly, no compensation cost is recognized for stock options since the exercise price
of these stock options equals the market price of the underlying stock on the date of the grant. Pro forma information regarding income and earnings per share as required by SFAS No. 123,
Accounting for Stock-Based Compensation, has been determined as if the company had accounted for
its stock option plans under the fair value method. The following table shows the companys pro
forma net income and earnings per share as if the company had recorded the fair value of stock
options as compensation expense: Three Months EndedDecember 31(Dollars in thousands, except per share amounts)
    
    2004
    
    
    2003Reported net income available to common shareholders
    
    $
    14,625
    
    
    $
    3,805Less: Stock-based compensation, net of tax
    
    
    (9,151
    )
    
    
    (5,812
    )Pro forma net income (loss) available to common shareholders
    
    $
    5,474
    
    
    $
    (2,007
    )Reported basic and diluted net income per share
    
    $
    0.09
    
    
    $
    0.02Pro forma basic and diluted net income (loss) per share
    
    $
    0.03
    
    
    $
    (0.01
    )
 In the quarter ended December 31, 2004, the company granted 1.5 million stock options that vested
immediately and included a restriction on the resale of the underlying shares of common stock. For
pro forma disclosure purposes, these options were expensed in the first quarter of 2005, increasing
pro forma expense by approximately $8.4 million. In the quarter ended December 31, 2003, the
company vested all outstanding options with an exercise price of $15 or more per share, increasing
pro forma stock-based compensation expense for the quarter by approximately $4.1 million. NOTE 9. CONTINGENCIES Warranty Reserve The company offers warranties on most of its products. The specific terms and conditions of the
warranties offered by the company vary depending upon the product sold. The company estimates the
costs that may be incurred under its warranty plans and records a liability in the amount of such
estimated costs at the time product revenue is recognized. Factors that affect the companys
warranty liability include the number of units sold, the type of products sold, historical and
anticipated rates of warranty claims and cost per claim. The company periodically assesses the
adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. The company
reports warranty reserves as a current liability, included in accrued expenses and other
liabilities. Changes in the companys warranty reserve during the three month periods ended
December 31, 2004 and 2003 are as follows: Three Months EndedDecember 31(Dollars in thousands)
    
    2004
    
    
    2003Warranty reserve at beginning of period
    
    $
    18,900
    
    
    $
    12,470Accrual for warranties issued
    
    
    4,062
    
    
    
    5,872Warranty settlements made
    
    
    (2,914
    )
    
    
    (1,903
    )Warranty expirations and adjustments
    
    
    174
    
    
    
    910Warranty reserve at end of period
    
    $
    20,222
    
    
    $
    17,349
 10




---



##### Table of Contents



After the close of the first quarter of fiscal 2005, the company was notified by one of its
customers of an abnormally high field failure rate for a specific component, supplied by a
third-party vendor, that is used in certain base station subsystem product lines. For additional
information see Note 14. Legal Proceedings On December 12, 2003, Antel Holding, Ltd. (Antel) a subsidiary of Group Menetap, Ltd., filed a
Notice of Arbitration and Statement of Claim with the American Arbitration Association. The claim
relates to the purchase by Antel of the companys interest in certain Russian ventures pursuant to
a Share Purchase and Sale Agreement dated November 5, 2001. The Statement of Claim asserts that
the company breached warranties and representations in connection with the sale and that Antel was
thereby damaged in an amount to be proven up to the indemnification limit of $40 million. This
claim is scheduled for hearing in March 2005. The company believes that the claim is without merit
and intends to defend the matter vigorously. On May 12, 2003, Ronald J. Huff and George D. Dill (Plaintiffs) filed a Complaint in the Santa
Clara County, California Superior Court alleging that Andrew used its position as an investor in
Comtier, a California corporation founded by Plaintiffs, to take unfair advantage of the assets and
opportunities of Comtier. Plaintiffs have not specified the amount of their claims. This case is
set for trial in April 2005. The company believes this case is without merit and intends to defend
the matter vigorously. The company believes that these claims are without merit and that an adverse settlement is neither
probable nor reasonably estimable. Therefore, the company has recorded no loss provision for these
proceedings. The company is also a party to various other legal proceedings, lawsuits and other
claims arising in the ordinary course of its business. The company does not believe that such
other litigation, if adversely determined, would have a material effect on the companys business,
financial position, results of operations or cash flow. NOTE 10. ACQUISITION OF BUSINESSES In November 2004, the company acquired selected assets of ATC Tower Services, Inc. a division of
American Tower Corporation that provides site installation services to wireless operators in North
America. This acquisition gives the company a national construction service presence and an
additional distribution channel for wireless infrastructure products. Total purchase consideration
was $9.0 million, consisting of $6.8 million in cash and the assumption of $2.2 million of capital
leases. A preliminary allocation of the purchase price resulted in $2.3 million of goodwill. The
company is evaluating the tangible and intangible assets acquired from American Tower and
anticipates finalizing the allocation of purchase price during the quarter ending June 30, 2005.
Pro forma results of operations, assuming the acquisition occurred at the beginning of the period,
were not materially different from the reported results of operations. NOTE 11. DEBT COVENANTS Under the terms of the companys $170.0 million revolving credit facility, the company has agreed
to meet various quarterly requirements. The company was in compliance with all of these
requirements as of December 31, 2004. The company must meet various requirements, including
maintaining net worth, maintaining a ratio of earnings before interest, taxes, depreciation and
amortization (EBITDA) to total debt, maintaining a fixed charge coverage ratio and limits on the
amount of assets that the company can dispose of in a fiscal year. These requirements may limit
the amount of borrowing under this credit agreement. Under the most restrictive of these
requirements, the company was limited to a maximum borrowing of $122.2 million at December 31,
2004. 11




---



##### Table of Contents



NOTE 12. BENEFIT PLANS The company has two defined benefit plans, one that covers approximately 600 current and former
employees of the companys United Kingdom subsidiary and a frozen plan that was acquired from Allen
Telecom that covers approximately 1,600 former employees of Allen Telecom. The components of net periodic pension costs for these plans, as well as the companys
post-retirement medical and life insurance plans, are as follows: Medical Plans and OtherPension Benefits
    
    
    BenefitsThree months ended
    
    
    Three months endedDecember 31
    
    
    December 31(Dollars in thousands)
    
    2004
    
    
    2003
    
    
    2004
    
    
    2003Service costs
    
    $
    504
    
    
    $
    642
    
    
    $
    50
    
    
    $
    173Interest costs
    
    
    1,599
    
    
    
    1,396
    
    
    
    173
    
    
    
    205Return on plan assets
    
    
    (1,392
    )
    
    
    (1,552
    )
    
    
    
    
    
    
    Amortization of unrecognized prior service costs
    
    
    88
    
    
    
    11
    
    
    
    (135
    )
    
    
    (11
    )Amortization of initial net obligation

    
    
    
    
    
    
    
    
    
    
    
    
    
    
    34Amortization of net loss
    
    
    204
    
    
    
    634
    
    
    
    158
    
    
    
    85Settlement loss
    
    
    
    
    
    
    15
    
    
    
    
    
    
    
    Net periodic costs
    
    $
    1,003
    
    
    $
    1,146
    
    
    $
    246
    
    
    $
    486
 NOTE 13. SEGMENTS Beginning in fiscal year 2005, the company reorganized its product groups. This reorganization
resulted in two reportable segments, Wireless Infrastructure and Satellite Communications. The
Wireless Infrastructure segment is based on meeting the infrastructure needs of wireless service
providers and Original Equipment Manufacturers (OEMs) and includes the following product groups:
Antenna and Cable Products, Base Station Subsystems, Network Solutions and Wireless Innovations.
The Satellite Communications segment is comprised of products supporting commercial and consumer
satellite applications. The company evaluates the performance of these segments based on sales and
operating income. The table below shows sales and operating income by segment. Three
Months EndedDecember 31(Dollars in thousands)
    
    2004
    
    
    2003SalesWireless Infrastructure
    
    $
    425,171
    
    
    $
    382,265Satellite Communications
    
    
    48,903
    
    
    
    28,506Total Consolidated Sales
    
    $
    474,074
    
    
    $
    410,771Operating Income (Loss)Wireless Infrastructure
    
    $
    55,747
    
    
    $
    58,703Satellite Communications
    
    
    (1,041
    )
    
    
    (6,575
    )Items not
included in segmentsUnallocated Sales and Administrative Costs
    
    
    (24,037
    )
    
    
    (26,869
    )Intangible Amortization
    
    
    (7,740
    )
    
    
    (9,421
    )Loss on Sale of Assets
    
    
    
    
    
    
    (4,511
    )Total Consolidated Operating Income
    
    $
    22,929
    
    
    $
    11,327
 12




---



##### Table of Contents



The company allocates only certain assets, primarily inventory and certain accounts receivable, to
each segment. All other assets are managed on a consolidated basis. Total Assets
    
    Dec. 31, 2004
    
    
    Sept. 30, 2004Wireless Infrastructure
    
    $
    332,528
    
    
    $
    308,434Satellite Communications
    
    
    36,809
    
    
    
    53,429Unallocated Assets
    
    
    1,919,437
    
    
    
    1,879,082Total Consolidated Assets
    
    $
    2,288,774
    
    
    $
    2,240,945
 NOTE 14. SUBSEQUENT EVENT After the close of the first quarter of fiscal 2005, the company was notified by one of its
customers of an abnormally high field failure rate for a specific component, supplied by a
third-party vendor, that is used in certain base station subsystem product lines. The company
anticipates recording a fiscal second quarter pre-tax charge of approximately $15 million to $20
million, based upon a preliminary analysis of the potential costs to replace and repair installed
units and maintain additional spare units. The company is reviewing data provided by the customer
on February 4, 2005, and is currently in discussions with appropriate third parties, including the
specific component supplier and the companys primary contract manufacturer, to ascertain potential
recovery of costs. 13




---



##### Table of Contents



ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS SUMMARY Sales for the quarter ended December 31, 2004 were $474.1 million, an increase of 15.4% compared to
the first quarter of fiscal 2004 and down 2.8% sequentially from the fourth quarter of fiscal 2004.
Compared to the first quarter of fiscal 2004, the company has seen growth driven by wireless
infrastructure spending in most major regions. On a sequential basis, sales were down 2.8% due to
normal seasonal trends and due to a decline in Satellite Communication sales. Higher sales and
lower operating expenses resulted in diluted earnings per share of $0.09, compared to $0.02 per
share in the first quarter of fiscal 2004. Approximately $0.02 per share of this increase was due
to the $4.5 million loss on the sale of selected assets of the companys broadcast antenna business
recorded in the first quarter of fiscal 2004. RESULTS OF OPERATIONS Beginning in fiscal year 2005, the company reorganized its product groups to better meet the
demands of customers and focus on the rapidly growing Satellite Communications market. This
reorganization resulted in two reportable segments, Wireless Infrastructure and Satellite
Communications. The Wireless Infrastructure segment is based on meeting the infrastructure needs
of wireless service providers and Original Equipment Manufacturers (OEMs) and includes the
following product groups: Antenna and Cable Products, Base Station Subsystems, Network Solutions
and Wireless Innovations. The Satellite Communications segment is based on products supporting
commercial and consumer satellite applications. Three Months Ended(Dollars in millions)
    
    December 31
    
    
    %
    
    
    % of2004
    
    
    2003
    
    
    Change
    
    
    TotalSales by SegmentWireless Infrastructure
    
    $
    425
    
    
    $
    382
    
    
    
    11
    %
    
    
    90
    %Satellite Communications
    
    
    49
    
    
    
    29
    
    
    
    69
    
    
    
    10Total
    
    $
    474
    
    
    $
    411
    
    
    
    15
    %
    
    
    100
    %
 Wireless Infrastructure sales increased 11% versus the prior year first quarter, driven by
increased sales in all major regions supporting network upgrades and expansions. Satellite
Communications sales increased 69% versus the prior year due to a significant increase in volume
for consumer broadband satellite products. Three Months Ended(Dollars in millions)
    
    December 31
    
    
    %
    
    
    % of2004
    
    
    2003
    
    
    Change
    
    
    TotalSales by Major RegionAmericas
    
    $
    254
    
    
    $
    229
    
    
    
    11
    %
    
    
    54
    %Europe, Middle East, Africa
    
    
    158
    
    
    
    124
    
    
    
    27
    
    
    
    33Asia Pacific
    
    
    62
    
    
    
    58
    
    
    
    7
    
    
    
    13Total
    
    $
    474
    
    
    $
    411
    
    
    
    15
    %
    
    
    100
    %
 Sales in the Americas increased 11% in the first quarter of fiscal 2005 versus the first quarter of
fiscal 2004 driven by network upgrades and expansion in Latin America and growth in consumer
satellite product sales in North America. Despite overall growth in the Americas, North American
sales of Antenna and Cable Products and Base Station Subsystems declined versus the prior fiscal
year first quarter, driven by weaker near-term trends of operator consolidation and asset
rationalization. North American sales for Network Solutions declined modestly versus the prior
fiscal year first quarter due to the timing of geolocation hardware installations. 14




---



##### Table of Contents



Europe, Middle East, and Africa (EMEA) sales increased 27% in the first quarter of 2005 compared to
the prior fiscal year first quarter due mainly to Antenna and Cable Products and Base Station
Subsystems product sales supporting network upgrades and expansion in Western Europe and emerging
markets. Wireless Innovations product sales to support increased coverage demands increased
modestly in EMEA. Approximately 25% of the sales increase in EMEA was due to a weaker dollar
versus the euro. Sales in the Asia Pacific region increased 7% in the first quarter of 2005 versus the prior year
first quarter driven by higher sales in Antenna and Cable Products and Wireless Innovations
supporting network expansion and coverage in India and China. Asia Pacific sales of Base Station
Subsystems products declined modestly versus the first quarter of last fiscal year. In the first quarter of fiscal 2005, the companys gross margin percentage was 23.3%, compared to
25.3% in the first quarter of fiscal 2004. The company estimates that approximately 1.2% of the
2.0% change was due to product mix, primarily attributable to the significant increase in consumer
satellite product sales and lower sales of higher margin Network Solutions products. The remaining
0.8% of this 2.0% change was driven by competitive market conditions and higher material costs. On
a sequential basis, the gross margin percentage improved 1.1% from the fourth quarter of fiscal
2004s gross margin percentage of 22.2%. The company anticipates that it will see further margin
improvement as it begins to realize the full benefit of its new facilities in Mexico and the Czech
Republic and executes additional programs to improve operational efficiencies. Compared to the first quarter of fiscal 2004, research and development expense increased in total
but was down as a percentage of sales. Research and development expense was $26.9 million or 5.7%
of sales in the first quarter of fiscal 2005, an increase of 4.9% from $25.6 million or 6.2% of
sales in the first quarter of fiscal 2004. The increase in research and development spending was
focused mainly on wireless infrastructure products such as power amplifiers, in-building coverage
and Network Solutions applications. Sales and administrative expenses were $51.0 million or 10.8% of sales in the first quarter of
fiscal 2005, down 2.8% from $52.5 million or 12.8% of sales in the first quarter of last fiscal
year. The overall decrease in spending was driven primarily by cost savings resulting from the
integration of Allen Telecoms operations with the companys. Compared to the fourth quarter of
fiscal 2004, sales and administrative costs decreased 8.1% from $55.6 million primarily due to
lower incentive compensation costs and headcount reductions achieved early in the first quarter. Intangible amortization was $7.7 million in the first quarter of fiscal 2005, compared to $9.4
million in the first quarter of fiscal 2004 and $9.5 million in the fourth quarter of fiscal 2004.
The decrease in intangible amortization was due to intangible assets acquired in the companys 2002
acquisition of Celiant Corporation becoming fully amortized in the fourth quarter of fiscal 2004.
The company anticipates that intangible amortization will decrease from $38.3 million in fiscal
year 2004 to approximately $22.0 million in fiscal year 2005, as additional intangible assets
become fully amortized. Restructuring expense was $1.8 million in the first quarter of fiscal 2005, compared to $0.7
million in the first quarter of fiscal 2004. The $1.8 million incurred in the first quarter was
severance and other costs incurred as part the companys integration plans and other cost cutting
initiatives that were expensed as incurred. In the first quarter of fiscal 2004, the company recognized a $4.5 million loss on the sale of
selected assets from its broadcast antenna manufacturing operations to Electronics Research Inc.
(ERI). This loss included an allocation of $4.0 million of goodwill that was attributed to these
broadcast assets based on fair value. Operating income was $22.9 million or 4.8% of sales in the first quarter of fiscal 2005, compared
to $11.3 million or 2.8% of sales in the first quarter of fiscal 2004. On a segment basis,
Wireless Infrastructure operating income was $55.7 million or 13.1% of Wireless Infrastructure
sales in the first quarter of 2005, compared to $58.7 million or 15.3% of Wireless Infrastructure
sales in the first quarter of fiscal 2004. This decrease was driven by lower overall gross margin,
offset partially by a decrease in operating expenses. The Satellite Communications segment reported
an operating loss of $1.0 million in the first quarter of fiscal 2005, compared to an operating
loss of $6.6 million in the first quarter of fiscal 2004. Operating loss decreased in the first
quarter of fiscal 2005, mainly due to start-up costs associated with the companys consumer
broadband satellite products, incurred in the first quarter of fiscal 2004. Interest expense was $3.7 million in the first quarter of fiscal 2005 compared to $3.9 million in
the first quarter of fiscal 2004 and $3.5 million in the fourth quarter of fiscal 2004. Interest
income increased to $1.7 million in the first quarter of fiscal 2005 compared to $0.7 million in
the first quarter of fiscal 2004 and $0.7 million in the fourth quarter of fiscal 2004. The
increase was due almost entirely to $0.8 million of interest income associated with a favorable
resolution of certain tax-related matters. 15




---



##### Table of Contents



Other expense was $1.5 million in the first quarter of fiscal 2005 compared to $1.9 million in the
first quarter of fiscal 2004 and $0.2 million in the fourth quarter of fiscal 2004. Other expense
is driven primarily by foreign exchange losses. During the first quarter of both fiscal 2004 and
2005, the company recognized foreign exchange losses due to the impact of a weaker dollar on net
U.S. dollar-denominated assets held by certain of the companys foreign subsidiaries. The companys reported tax rate for the first quarter of fiscal 2005 was 24.1%, reflecting an
underlying effective tax rate on operations of 37.5% and a $2.6 million benefit related to the
reversal of previously accrued taxes resulting from a favorable resolution of certain tax-related
matters. The companys effective tax rate for the first quarter of fiscal 2004 was 35.0%. The
effective income tax rates for the various tax jurisdictions in which the company operates can vary
significantly. Fluctuations in earnings in these jurisdictions has resulted in, and could continue
to result in, significant fluctuations in the companys effective tax rate. The company currently
forecasts that the effective tax rate will be 37.5% for the remaining nine months of fiscal 2005. As of December 31, 2004, the company had a net deferred tax asset of approximately $63 million,
primarily attributable to U.S. net operating losses carried forward, which will begin to expire in
2018. Recoverability of this deferred tax asset is dependent upon the companys ability to generate
future taxable profits in the U.S. The company continuously reviews and assesses the recoverability
of its deferred tax asset and it is our current opinion that the entire net deferred tax asset is
fully recoverable. Should the company subsequently determine it is more likely than not that this
deferred tax asset will not be realized, the company would be required to record a valuation
allowance against some portion or all of the deferred tax asset at that time. Recording of a
valuation allowance could have a material adverse impact upon the companys effective tax rate and
reported financial results. The recently enacted American Jobs Creation Act of 2004 provides a temporary incentive for U.S.
corporations to repatriate accumulated income earned abroad. The repatriation of income from the
companys foreign subsidiaries could significantly impact the companys effective tax rate. The
company has not yet determined whether, and to what extent, it would repatriate unremitted foreign
earnings. The company expects to finalize its analysis of these provisions by the end of the
quarter ending June 30, 2005. LIQUIDITY Cash and cash equivalents were $179.4 million at December 31, 2004, compared to $189.0 million at
September 30, 2004. Cash and cash equivalents declined primarily due to increased working capital
requirements and annual incentive plan payouts for fiscal 2004. Working capital at December 31,
2004 was $651.9 million, up from $612.1 million at September 30, 2004. Management believes that
the companys strong working capital position, ability to generate cash flow from operations, and
ability to borrow under its revolving credit agreement will allow the company to meet its normal
operating cash flow needs for the foreseeable future. In the first quarter of fiscal 2005, the company used $18.8 million of cash for operations,
compared to $15.7 million in the first fiscal quarter of last year. Cash flow used for operations
was driven by net income of $14.7 million, $22.0 million of non-cash charges for depreciation and
amortization, $3.3 million used for restructuring, and a net change in operating assets and
liabilities that resulted in a $52.2 million decrease in cash flow. Accounts receivable increased in the first quarter of fiscal 2005, reducing cash flow by $12.5
million. Days sales in billed receivables (DSO) increased to 82 days at December 31, 2004,
compared to 74 days at September 30, 2004. The increase in DSO was a result of a higher mix of
international sales, which generally carry longer payment terms than domestic sales. The $32.7
million decrease in accounts payable and other liabilities was principally due to the decrease in
accrued compensation costs for annual incentive plan payouts. 16




---



##### Table of Contents



In the first quarter of fiscal 2005, the company used $11.9 million for investing activities,
compared to $45.8 million in the first quarter of fiscal 2004. The company spent $14.0 million on
capital expenditures, compared to $19.6 million in the prior years first fiscal quarter. The
$19.6 million of capital expenditures in the first fiscal quarter of last year included $9.1
million for the companys new Reynosa, Mexico facility. In the first fiscal quarter of 2005, the
company spent $7.9 million on acquisitions. The company acquired selected assets of ATC Tower
Services, Inc., for total purchase consideration of $9.0 million, including $6.8 million of cash.
ATC Tower Services, Inc., was a division of American Tower Corporation that provides site
installation services to wireless operators in North America. The company paid $1.1 million to
acquire the 20% minority interest in a Czech Republic subsidiary that was acquired in the Allen
Telecom acquisition. In the first quarter of fiscal 2004, the company spent $23.2 million on
acquisitions, acquiring selected assets of Yantai Fine Cable, a Chinese manufacturer of products
for the broadband cable market, and Channel Master LLC, a U.S. manufacturer of products for the
consumer direct broadcast satellite market. In the first quarter of fiscal 2004, the company
invested $6.5 million in Andes Industries, a U.S. distributor and manufacturer of high-performance
optical equipment and other products for broadband cable networks. This investment was in the form
of a convertible, interest-bearing note that allows the company to convert the note into an equity
interest. In the first quarter of 2005, the company received net proceeds of $9.5 million from the
sale of selected assets of its mobile antenna product line to PCTEL, Inc. In the first quarter of
fiscal 2004, the company received $3.0 million in cash from the sale of selected assets of its
broadcast antenna business to Electronic Research Inc. (ERI). Net cash from financing activities during the first quarter of fiscal 2005 totaled $8.8 million,
compared to $14.0 million used for financing activities in the first quarter of fiscal 2004. In
the first quarter of fiscal 2005, the companys Indian subsidiary borrowed $9.1 million of notes
payable under its local line of credit to finance growth and to eliminate foreign exchange
exposures on short-term intercompany payables. In the first quarter of fiscal 2004, the company
reduced its long-term debt by $11.7 million due to principal payments on senior notes acquired from
Allen Telecom. Also in the first quarter of fiscal 2004, the company used $2.5 million to
repurchase 225,000 shares of its common stock. SAFE HARBOR FOR FORWARD-LOOKING STATEMENTS We have made forward-looking statements in this Form 10-Q under Managements Discussion and
Analysis of Financial Condition and Results of Operations and in the Notes to Consolidated
Financial Statements. In addition, our representatives or management may make other written or
oral statements that constitute forward-looking statements. Forward-looking statements are based
on managements beliefs and assumptions and on information currently available to them. These
statements often contain words like believe, expect, anticipate, intend, contemplate, seek, plan,
estimate or similar expressions. We make these statements under the protection afforded them by
Section 21E of the Securities Exchange Act of 1934. Forward-looking statements involve risks, uncertainties and assumptions, including those discussed
in this report. We operate in a continually changing business environment, and new risk factors
emerge from time to time. We cannot predict those risk factors, nor can we assess the impact, if
any, of those risk factors on our business or the extent to which any factors may cause actual
results to differ materially from those projected in any forward-looking statements.
Forward-looking statements do not guarantee future performance, and you should not put undue
reliance on them. While Andrew Corporations management is optimistic about the companys long-term prospects, one
should consider the risks and uncertainties in evaluating its growth outlook. Factors that may
cause actual results to differ from expected results include the companys ability to integrate
acquisitions and to realize the synergies and cost savings anticipated from these transactions, the
effects of competitive products and pricing, economic and political conditions that may impact
customers ability to fund purchases of our products and services, the companys ability to achieve
the cost savings anticipated from cost reduction programs, fluctuations in international exchange
rates, the timing of cash payments and receipts, end use demands for wireless communication
services, the loss of one or more significant customers and other business factors. For a more
complete discussion of these and other risks, uncertainties and assumptions that may affect us, see
the companys annual report on Form 10-K for the fiscal year ended September 30, 2004. 17




---



##### Table of Contents



ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK See Item 7A of the companys Annual Report on Form 10-K for the year ended September 30, 2004.
With the exception of copper purchase commitments there has been no material change from the end of
the previous fiscal year through December 31, 2004. The company uses various metals in the production of its products. Copper, which is used to
manufacture coaxial cable, is the most significant of these metals. The company uses approximately
50 million pounds of copper annually. As a result, the company is exposed to fluctuations in the
price of copper. In order to reduce this exposure, the company has entered into contracts with
various suppliers to purchase copper. At December 31, 2004, the company had contracts to purchase
14.8 million pounds of copper for $17.6 million. In January 2005, the company purchased contracts
for an additional 3.2 million pounds of copper for $4.6 million. For the remainder of fiscal year
2005, the company estimates that it will make additional purchases of approximately 18 million
pounds of copper in addition to the 18.0 million pounds that it currently has under contract. Based
on current market prices and estimated remaining copper purchases, a 10% increase in the price of
copper would increase the companys fiscal 2005 cost of products sold by approximately $2.5
million. 
 ITEM 4. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures: As of December 31, 2004, the companys management, including its Chief Executive Officer and Chief
Financial Officer, have reviewed and evaluated the effectiveness of the companys disclosure
controls and procedures pursuant to Rule 13a-15(b) of the Securities Exchange Act of 1934. Based
on that review and evaluation, the Chief Executive Officer and Chief Financial Officer have
concluded that the companys disclosure controls and procedures are adequate and effective and that
no changes are required at this time. Changes in Internal Controls: In connection with the evaluation by management, including its Chief Executive Officer and Chief
Financial Officer, of the companys internal control over reporting, pursuant to Exchange Act Rule
13a-15(d), no changes during the quarter ended December 31, 2004 were identified that have
materially affected, or are reasonably likely to materially affect, the companys internal control
over financial reporting. 
 PART IIOTHER INFORMATION 
 ITEM 1. LEGAL PROCEEDINGS On December 12, 2003, Antel Holding, Ltd. (Antel) a subsidiary of Group Menetap, Ltd., filed a
Notice of Arbitration and Statement of Claim with the American Arbitration Association. The claim
relates to the purchase by Antel of the companys interest in certain Russian ventures pursuant to
a Share Purchase and Sale Agreement dated November 5, 2001. The Statement of Claim asserts that
the company breached warranties and representations in connection with the sale and that Antel was
thereby damaged in an amount to be proven up to the indemnification limit of $40 million. This
claim is scheduled for hearing in March 2005. The company believes that the claim is without merit
and intends to defend the matter vigorously. On May 12, 2003, Ronald J. Huff and George D. Dill (Plaintiffs) filed a Complaint in the Santa
Clara County, California Superior Court alleging that Andrew used its position as an investor in
Comtier, a California corporation founded by Plaintiffs, to take unfair advantage of the assets and
opportunities of Comtier. Plaintiffs have not specified the amount of their claims. This case is
set for trial in April 2005. The company believes this case is without merit and intends to defend
the matter vigorously. The company is also a party to various other legal proceedings, lawsuits and other claims arising
in the ordinary course of its business. The company does not believe that such other litigation,
if adversely determined, would have a material effect on the companys business, financial
position, results of operations or cash flow. 18




---



##### Table of Contents



ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS Since 1997, the companys Board of Directors has authorized the company to repurchase up to 30.0
million common shares. As of December 31, 2004 the company had repurchased approximately 17.0
million shares under this plan. These repurchases may be made on the open market or in negotiated
transactions and the timing and amount of shares repurchased will be determined by the companys
management. No shares were repurchased during the first quarter of 2005. 
 ITEM 6. EXHIBITS Exhibit No.
    
    Description31
    
    
    Rule 13a-14(a) Certification of Chief Executive and Chief Financial Officers32
    
    
    18 U.S.C. Section 1350 Certifications of Chief Executive and Chief Financial Officers
 19




---



##### Table of Contents



SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly authorized. Date February 8, 2005
    
    By:
    
    /s/ Marty R. KittrellMarty R. KittrellChief Financial Officer(Duly Authorized Officer and Principal Financial Officer)
 20




---



##### Table of Contents



EXHIBIT INDEX Exhibit No.
    
    Description31
    
    Rule 13a-14(a) Certification of Chief Executive and Chief Financial Officers32
    
    18 U.S.C. Section 1350 Certifications of Chief Executive and Chief Financial Officers
 21