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Christchurch LAN Cable Plant at Full Capacity

8 November 2004

Christchurch LAN Cable Plant at Full Capacity

US Export Order to Benefit Domestic Market

General Cable’s upgraded manufacturing plant for local area network (LAN) products is running at full capacity following the company’s selection to supply a resurgent US datacomms market.

The company has secured orders in excess of $6.5million for the supply of LAN products for its US parent company through until the end of 2005.

The deal will see the Christchurch LAN plant, upgraded in 2003, operating at maximum output with efficiency levels that should deliver cost efficiencies for the Australasian market.

General Cable’s General Manager for Utilities and International Business, Aviral Garg, stressed that the deal was in no way an “easy order” from the company’s parent, with international competition for the business.

“This is the first time we’ve been in a position to meet the strong demand in the United States, and it took a concerted effort across the company, including production, technical, logistics and commercial support, to develop a winning bid,” says Garg.

Reducing costs and improving logistics was the key to the company’s success. Efficiency was improved by running the LAN plant at higher speeds, labour efficiencies and developing new materials and processes, while maintaining performance to international standards. Garg says the increase in output is substantial, requiring the recruitment of a number of additional production staff.

General Cable has manufactured LAN cable at its Christchurch sites for the last 12 years but more recently has been unable to compete in the export market, outside Australasia, due to the strength of the New Zealand dollar and a proliferation of high volume manufacturers in Asia. However the company’s efficiency gains, coupled with the strength of the US datacomms market, means this opportunity can be pursued. There was also a renewed emphasis on quality in several export markets, with many customers reluctant to commit to low cost products of unknown origin.

Garg says the improved economies of scale at the LAN plant should translate into stable pricing for locally made LAN cable in the domestic market, following a period of input material price increases – notably copper. “We hope the efficiencies within the LAN operation, and the further cost reductions we intend to make, will translate into a period of relative price stability for the New Zealand data cabling market.”

The US deal started with a short term contract to produce around $1million of LAN products, but was increased to more than $6.5million based on the company’s quality and performance.

General Cable New Zealand Limited manufactures and supplies a wide range of high-spec copper and fibre LAN products. This includes the latest Category 6 UTP cabling, which requires level high levels of positive ACR (Attenuation Crosstalk Ratio) over existing Cat 5 levels.

About General Cable Corporation General Cable (NYSE: BGC), headquartered in Highland Heights, Kentucky, is a leader in the development, design, manufacture, marketing and distribution of copper, aluminium and fibre optic wire and cable products for the communications, energy and specialty markets. The Company offers competitive strengths in such areas as breadth of product line, brand recognition, distribution and logistics, sales and service and operating efficiency.

Communications wire and cable products transmit low-voltage signals for voice, data, video and control applications. Energy cables include low-, medium- and high-voltage power distribution and power transmission products.

The Specialty segment is comprised of application-specific cables for uses such as electrical power generation (traditional fuels, alternative and renewable sources, and distributed generation), the oil, gas and petrochemical industries, mining, industrial automation, automotive, marine, military and aerospace applications, power applications in the telecommunications industry, and other key industrial segments. Visit our website at www.GeneralCable.com.

ENDS


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