Soaring copper price weighs heavily on Andrew

LONDON — The soaring price of copper and other raw materials over the last few months has forced network communications and coax cable maker Andrew Corporation to add a steep surcharge across many of its products.

Andrew(Westchester, Ill.) said that effective May 1, it would increase the previously implemented surcharge assessed on its HELIAX and RADIAX products. A month later, it plans to expand the use of surcharges to include all cable products, such as connectors, assemblies, and accessories, which utilize these raw materials.

The company added it would adjust prices periodically as the market rate of copper fluctuates. It noted spot prices for copper delivery in May 2006 have risen to more than $3.25 per pound compared to approximately $1.22 in May 2005.

Looking further ahead, Andrew said it would accelerate the pace of research and testing of alternative materials in the manufacture of cable products.

“The use of materials other than copper represents a major technology change in the application of wireless radio frequency (RF) cable, and Andrew’s team of experts are leading the effort to ensure that alternative metals can provide RF performance that is of the same world-class quality and reliability that our customers have come to expect from us,” said John DeSana, group president of the company’s Antenna and Cable Products Group.

Separately, Andrew also posted Thursday (April 27) a sharp decline in fiscal second-quarter profits with weaker than expected demand from wireless operators.

The company said net profit fell to $3.6 million, or 2 cents per share, from $15.2 million, or 9 cents per share a year ago.

Sales were flat at $481.7 million. Andrew Chief Executive Ralph Faison said second quarter sales reflected "greater than normal seasonal weakness" in wireless operator needs.

The company predicted third quarter sales of $510 million to $540 million and earnings per share of 6 cents to 9 cents.