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
	for the quarterly period ended ~~September 27, 2008~~March 28, 2009 or
¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number

001-07283

REGAL BELOIT CORPORATION

(Exact name of registrant as specified in its charter)

~~REGAL BELOIT CORPORATION~~

~~(Exact name of registrant as specified in its charter)~~

Wisconsin	39-0875718
(State of other jurisdiction of incorporation)	(IRS Employer Identification No.)

~~200 State Street, Beloit, Wisconsin 53511~~

200 State Street, Beloit, Wisconsin 53511

~~(Address of principal executive office)~~

(Address of principal executive office)

~~(608) 364-8800~~

(608) 364-8800

Registrant’s telephone number, including area code

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 that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ý NO ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES ¨ NO ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a ~~non-accelerated filer.~~“smaller reporting company.” See ~~definition~~the definitions of ~~“accelerated filer and large~~“large accelerated filer” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer ý Accelerated Filer ¨ Non-accelerated filer ¨ Smaller Reporting Company o

(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES ¨ NO ý

~~32,276,145~~31,503,031 Shares, Common Stock, $.01 Par Value (as of ~~October 31, 2008)~~May 1, 2009)

REGAL BELOIT CORPORATION

INDEX

CAUTIONARY STATEMENT

This Quarterly Report contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements represent our management’s judgment regarding future events. In many cases, you can identify forward-looking statements by terminology such as “may,” “will,” “plan,” “expect,” “anticipate,” “estimate,” “believe,” or “continue” or the negative of these terms or other similar words. Actual results and events could differ materially and adversely from those contained in the forward-looking statements due to a number of factors, including:

economic changes in global markets where we do business, such as reduced demand for products we sell, weakness in the housing and commercial real estate markets, currency exchange rates, inflation rates, interest rates, recession, foreign government policies and other external factors that we cannot control;

·	unanticipated fluctuations in commodity prices and raw material costs;

·	cyclical downturns affecting the global market for capital goods;

·	unexpected issues and costs arising from the integration of acquired companies and businesses;

·	marketplace acceptance of new and existing products including the loss of, or a decline in business from, any significant customers;

·	the impact of capital market transactions that we may effect;

·	the availability and effectiveness of our information technology systems;

·	unanticipated costs associated with litigation matters;

·	actions taken by our competitors, including new product introductions or technological advances, and other events affecting our industry and competitors;

·	difficulties in staffing and managing foreign operations; and other domestic and international economic and political factors unrelated to our performance, such as the current substantial weakness in economic and business conditions and the stock markets as a whole; and

·	other risks and uncertainties including but not limited to those described in Item 1A-Risk Factors of the Company’s Annual Report on Form 10-K filed on February ~~27, 2008~~25, 2009 and from time to time in our reports filed with U.S. Securities and Exchange Commission.

All subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the applicable cautionary statements. The forward-looking statements included in this Form 10-Q are made only as of their respective dates, and we undertake no obligation to update these statements to reflect subsequent events or circumstances. See also Item 1A - Risk Factors in the Company’s Annual Report on Form 10-K filed on February ~~27, 2008.~~25, 2009.

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PART I - FINANCIAL INFORMATION

REGAL BELOIT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

(In Thousands of Dollars, Except Shares Outstanding, Dividends Declared and Per Share Data)

ITEM I. 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Three Months Ended Nine Months Ended
September 27, 2008
September 29,
2007
September 27, 2008
September 29,
2007

Net Sales $ 620,607 $ 449,374 $ 1,763,266 $ 1,327,815

Cost of Sales 487,810 342,660 1,377,193 1,019,998

Gross Profit 132,797 106,714 386,073 307,817

Operating Expenses 67,063 53,339 195,233 147,056

Income From Operations 65,734 53,375 190,840 160,761

Interest Expense 7,103 5,116 21,449 14,607

Interest Income 418 365 1,333 695

Income Before Taxes & Minority Interest 59,049 48,624 170,724 146,849

Provision For Income Taxes 21,261 16,638 60,826 50,301

Income Before Minority Interest 37,788 31,986 109,898 96,548

Minority Interest in Income, Net of Tax 882 747 2,749 2,243

Net Income $ 36,906 $ 31,239 $ 107,149 $ 94,305

Earnings Per Share of Common Stock:

Basic $ 1.18 $ 1.00 $ 3.42 $ 3.02

Assuming Dilution $ 1.09 $ 0.92 $ 3.20 $ 2.78

Cash Dividends Declared $ 0.16 $ 0.15 $ 0.47 $ 0.44

Weighted Average Number of Shares Outstanding:

Basic 31,357,433 31,320,838 31,326,675 31,227,373
Assuming Dilution 33,715,881 34,104,123 33,452,880 33,943,057

	Three Months Ended
			(As Adjusted,
			See Note 2)
	March 28, 2009		March 29, 2008

Net Sales	$	443,274	$	536,343

Cost of Sales		352,704		414,244

Gross Profit		90,570		122,099

Operating Expenses		62,378		64,487

Income From Operations		28,192		57,612

Interest Expense		7,119		8,413

Interest Income		133		384

Income Before Taxes & Noncontrolling Interests		21,206		49,583

Provision For Income Taxes		7,230		17,558

Net Income		13,976		32,025

Less: Net Income Attributable to Noncontrolling Interests, net of tax		1,189		598

Net Income Attributable to Regal Beloit Corporation	$	12,787	$	31,427

Earnings Per Share of Common Stock:

Basic	$	0.41	$	1.00

Assuming Dilution	$	0.39	$	0.95

Cash Dividends Declared	$	0.16	$	0.15

Weighted Average Number of Shares Outstanding:

Basic		31,457,282		31,316,878
Assuming Dilution		32,594,802		33,117,034

See accompanying Notes to Condensed Consolidated Financial Statements.

Return to Index

RE~~GAL~~REGAL BELOIT CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands of Dollars, Except Share Data)

				(From Audited						(As Adjusted, From Audited
	(Unaudited)			Statements)			(Unaudited)			Statements, See Note 2)
ASSETS	September 27, 2008			December 29, 2007			March 28, 2009			December 27, 2008
Current Assets:
Cash and Cash Equivalents	$	113,722		$	42,574		$	82,078		$	65,250
Receivables, less Allowances for Doubtful Accounts of
$9,124 in 2008 and $10,734 in 2007		394,022			297,569
Trade Receivables, less Allowances of $11,593 in 2009, and
$11,145 in 2008								272,661			294,326
Inventories		330,346			318,200			327,324			359,918
Prepaid Expenses and Other Current Assets		30,233			35,626			79,643			66,594
Deferred Income Tax Benefits		37,317			34,522			57,883			75,174
Total Current Assets		905,640			728,491			819,589			861,262

Property, Plant and Equipment:
Land and Improvements		37,803			31,766			37,133			39,982
Buildings and Improvements		127,540			117,707			128,456			127,018
Machinery and Equipment		470,649			435,792			468,540			457,063
Property, Plant and Equipment, at Cost		635,992			585,265			634,129			624,063
Less - Accumulated Depreciation		(264,363	)		(245,922	)		(281,444	)		(265,691	)
Net Property, Plant and Equipment		371,629			339,343			352,685			358,372

Goodwill		648,008			654,261			667,864			672,475
Intangible Assets, Net of Amortization		119,058			129,473			118,851			120,784
Other Noncurrent Assets		8,158			10,679			10,892			10,603
Total Assets	$	2,052,493		$	1,862,247		$	1,969,881		$	2,023,496

LIABILITIES AND SHAREHOLDERS' INVESTMENT
LIABILITIES AND EQUITY
Current Liabilities:
Accounts Payable		252,782			183,215			152,991			202,456
Dividends Payable		5,023			4,700			5,039			5,024
Accrued Compensation and Employee Benefits		63,552			55,315			56,692			64,207
Other Accrued Expenses		89,664			63,358			64,936			63,457
Hedging Obligations								46,776			80,578
Current Maturities of Debt		17,159			5,332			7,020			15,280
Total Current Liabilities		428,180			311,920			333,454			431,002

Long-Term Debt		554,087			558,918			580,283			560,127
Deferred Income Taxes		82,318			75,055			71,302			72,119
Hedging Obligations								55,265			61,958
Pension and Other Post Retirement Benefits								44,237			43,768
Other Noncurrent Liabilities		33,679			27,041			12,184			16,881
Pension and Other Postretirement Benefits		20,592			20,742

Minority Interest in Consolidated Subsidiaries		14,053			10,542

Shareholders' Investment:
Equity:
Regal Beloit Corporation Shareholders' Equity:
Common Stock, $.01 par value, 100,000,000 shares
authorized in 2008 and 2007,
32,276,145 shares issued in 2008 and
32,105,824 issued in 2007		322			321
authorized, 32,378,565 issued in 2009, and
32,276,145 shares issued in 2008								324			323
Additional Paid-In Capital		341,375			335,452			357,500			356,231
Less - Treasury Stock, at cost, 884,100 shares in 2008,		(19,419	)		(15,228	)
and 774,100 shares in 2007
Less - Treasury Stock, at cost, 884,100 shares in 2009 and 2008								(19,419	)		(19,419	)
Retained Earnings		627,727			535,304			639,029			631,281
Accumulated Other Comprehensive Income (Loss)		(30,421	)		2,180
Total Shareholders' Investment		919,584			858,029
Total Liabilities and Shareholders' Investment	$	2,052,493		$	1,862,247
Accumulated Other Comprehensive Loss								(118,535	)		(142,429	)
Total Regal Beloit Corporation Shareholders' Equity								858,899			825,987
Noncontrolling Interests								14,257			11,654
Total Equity								873,156			837,641
Total Liabilities and Equity							$	1,969,881		$	2,023,496

See accompanying Notes to Condensed Consolidated Financial Statements.

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REGAL BELOIT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(In Thousands of Dollars, Except Per Share Data)

	Regal Beloit Corporation Shareholders' Equity
	Common Stock $.01 Par Value		Additional Paid-In Capital		Treasury Stock			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Noncontrolling Interests		Total Equity
Balance as of December 29, 2007	$	321	$	348,971	$	(15,228	)	$	525,506		$	2,180		$	10,542	$	872,292
(As Adjusted, See Note 2)

Net Income	$	-	$	-	$	-		$	31,427		$	-		$	598	$	32,025
Dividends Declared
($.15 per share)		-		-		-			(4,675	)		-			-		(4,675	)
Purchase of 110,000
Shares of Treasury Stock		-		-		(4,191	)		-			-			-		(4,191	)
Stock Options
Exercised,
including income
tax benefit and share
cancellations		1		1,375		-			-			-			-		1,376
Stock-based Compensation		-		882		-			-			-			-		882
Other Comprehensive
Income (Loss) by
Classification:
Currency Translation
adjustments		-		-		-			-			1,323			462		1,785
Hedging Activities,
net of tax		-		-		-			-			10,337			-		10,337
Pension and Post
Retirement
Benefits net of tax		-		-		-			-			95			-		95
Balance as of March 29, 2008	$	322	$	351,228	$	(19,419	)	$	552,258		$	13,935		$	11,602	$	909,926



	Regal Beloit Corporation Shareholders' Equity
	Common Stock $.01 Par Value		Additional Paid-In Capital		Treasury Stock			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Noncontrolling Interests		Total Equity
Balance as of December 27, 2008	$	323	$	356,231	$	(19,419	)	$	631,281		$	(142,429	)	$	11,654	$	837,641
(As Adjusted, See Note 2)

Net Income	$	-	$	-	$	-		$	12,787		$	-		$	1,189	$	13,976
Dividends Declared
($.16 per share)		-		-		-			(5,039	)		-			-		(5,039	)
Stock Options
Exercised,
including income
tax benefit and share
cancellations		1		496		-			-			-			-		497
Stock-based Compensation		-		773		-			-			-			-		773
Other Comprehensive
Income (Loss) by
Classification:
Currency Translation
adjustments		-		-		-			-			(3,970	)		1,414		(2,556	)
Hedging Activities, net
of tax		-		-		-			-			27,190			-		27,190
Pension and Post
Retirement Benefits,
net of tax		-		-		-			-			674			-		674
Balance as of March 28, 2009	$	324	$	357,500	$	(19,419	)	$	639,029		$	(118,535	)	$	14,257	$	873,156

See accompanying Notes to Condensed Consolidated Financial Statements.

RReturn to Index~~EGAL~~

REGAL BELOIT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In Thousands of Dollars)

Nine Months Ended
September 27, 2008 September 29, 2007
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 107,149 $ 94,305
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 45,128 30,345
Minority interest 2,749 2,243
Excess tax benefits from stock-based compensation (2,463 ) (6,681 )
Loss (gain) on sale of assets, net 124 (34 )
Stock-based compensation expense 3,356 2,802
Change in assets and liabilities, net 2,540 45,337
Net cash provided by operating activities 158,583 168,317

CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and equipment (43,947 ) (23,818 )
Business acquisitions, net of cash acquired (15,805 ) (253,241 )
Sale of property, plant and equipment 2,158 160
Net cash used in investing activities (57,594 ) (276,899 )

CASH FLOWS FROM FINANCING ACTIVITIES:
Net (repayments) proceeds from short-term borrowing (10,030 ) 8,200
Payments of long-term debt (293 ) (333 )
Net repayments under revolving credit facility (169,700 ) (76,200 )
Net repayments of commercial paper borrowings - (49,000 )
Net proceeds from long-term borrowings 165,000 250,000
Dividends paid to shareholders (14,404 ) (13,394 )
Purchases of treasury stock (4,191 ) -
Proceeds from the exercise of stock options 2,740 1,684
Excess tax benefits from stock-based compensation 2,463 6,681
Distributions to minority partners - (106 )
Financing feeds paid (454 ) (1,397 )
Net cash (used in) provided by financing activities (28,869 ) 126,135

EFFECT OF EXCHANGE RATES ON CASH (972 ) 1,491

Net increase in cash and cash equivalents 71,148 19,044
Cash and cash equivalents at beginning of period 42,574 36,520
Cash and cash equivalents at end of period $ 113,722 $ 55,564

	Three Months Ended
				(As Adjusted, See Note 2)
	March 28, 2009			March 29, 2008
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	13,976		$	32,025
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization		15,277			14,152
Excess tax benefits from stock-based compensation		(1,675	)		(452	)
(Gain) loss on sale of assets, net		(91	)		70
Stock-based compensation expense		773			882
Non-cash convertible debt deferred financing costs		1,063			1,194
Change in assets and liabilities, net of acquisitions		(10,725	)		(13,005	)
Net cash provided by operating activities		18,598			34,866

CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and equipment		(8,143	)		(13,646	)
Business acquisitions, net of cash acquired		(1,500	)		374
Sale of property, plant and equipment		306			1,149
Net cash used in investing activities		(9,337	)		(12,123	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net repayments of short-term borrowings		(8,265	)		-
Payments of long-term debt		(56	)		(113	)
Net borrowings (repayments) under revolving credit facility		19,150			(8,200	)
Dividends paid to shareholders		(5,024	)		(4,700	)
Purchases of treasury stock		-			(4,191	)
Proceeds from the exercise of stock options		512			1,364
Excess tax benefits from stock-based compensation		1,675			452
Net cash provided by (used in) financing activities		7,992			(15,388	)

EFFECT OF EXCHANGE RATES ON CASH		(425	)		602

Net increase in cash and cash equivalents		16,828			7,957
Cash and cash equivalents at beginning of period		65,250			42,574
Cash and cash equivalents at end of period	$	82,078		$	50,531

See accompanying Notes to Condensed Consolidated Financial Statements.

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REREGA~~GAL~~L BELOIT CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~September 27, 2008~~March 28, 2009

(Unaudited)

1. BASIS OF PRESENTATION

The accompanying (a) condensed consolidated balance sheet as of December ~~29, 2007,~~27, 2008, which has been derived from audited financial statements, and (b) unaudited interim condensed consolidated financial statements as of ~~September 27, 2008~~March 28, 2009, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.

It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and the notes thereto included in the Company’s 2008 Annual Report on Form 10-K filed on February 25, 2009.

As of the beginning of fiscal 2009, the Company adopted the following pronouncements which require us to adjust previously disclosed condensed consolidated financial statements. As such, certain prior period amounts have been adjusted in the unaudited condensed consolidated financial statements to conform to the current period presentation.

The Company adopted Statement of Financial Accounting Standards (“SFAS”) No. 160, “Noncontrolling Interests in Consolidated Financial Statements – an amendment of ARB No. 51” (“SFAS 160”). SFAS 160 amends the accounting and reporting for noncontrolling interests in a consolidated subsidiary and the deconsolidation of a subsidiary. Under SFAS 160, we now report noncontrolling interests in subsidiaries as a separate component of equity in the condensed consolidated financial statements and show both net income attributable to the noncontrolling interest and net income attributable to the controlling interest on the face of the condensed consolidated income statement. SFAS 160 applies prospectively, except for presentation and disclosure requirements, which are applied retrospectively.

The Company adopted Financial Accounting Standards Board (“FASB”) Staff Position (“FSP”) No. APB 14-1, “Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)” (“FSP APB 14-1”). The adoption of FSP APB 14-1 required an adjustment of convertible debt and related cumulative interest expense. (See Note 2 of Notes to Condensed Consolidated Financial Statements.)

Certain non-trade receivables at December 27, ~~2008.~~2008 have been reclassified from Receivables to Prepaid Expenses and Other Current Assets to conform to the 2009 presentation. Trade Receivables less Allowances on the Condensed Consolidated Balance Sheets is now comprised of trade receivables net of estimated allowances.

In the opinion of management, all adjustments considered necessary for a fair presentation of financial results have been made. Except as otherwise discussed, such adjustments consist of only those of a normal recurring nature. Operating results for the ~~nine~~three months ended ~~September 27, 2008~~March 28, 2009 are not necessarily indicative of the results that may be expected for the entire fiscal year ending ~~December 27, 2008.~~January 2, 2010.

The Company operates on a 52/53 week fiscal year, and fiscal 2009 will be a 53 week year with an additional week in the fiscal fourth quarter.

2.ADOPTION OF FSP APB 14-1

As of the beginning of fiscal 2009, the Company adopted FSP APB 14-1 which requires an adjustment of convertible debt and related interest expense. The new standard requires that a fair value be assigned to the equity conversion option of the Company’s $115.0 million, 2.75% convertible senior subordinated notes (the “Convertible Notes”) as of April 5, 2004, the date of issuance of the Convertible Notes. This change results in a corresponding decrease in the value assigned to the debt portion of the instrument.

The value assigned to the debt portion of the Convertible Notes was determined based on market interest rates for similar debt instruments without the conversion feature as of April 5, 2004, the issuance date of the Convertible Notes. The difference in this interest rate versus the coupon rate on the Convertible Notes is then amortized into interest expense over the expected term of the Convertible Notes. For purposes of our valuation, we used an expected term of five years, which represents the first anniversary date at which holders of the Convertible Notes may put their Convertible Notes back to the Company.

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The five year anniversary occurred in March 2009, and through March 28, 2009, no Convertible Notes were put to the Company and no Convertible Notes were called by the Company. Accordingly, the book value as of March 28, 2009 equals the par value of the Convertible Notes, and interest expense will equal the coupon rate in future periods.

The adjustment affected our balance sheet as follows (in thousands):

	December 27, 2008
	As Adjusted		As Reported
Long-Term Debt	$	560,127	$	561,190
Deferred Income Taxes		72,119		71,715
Additional Paid-in Capital		356,231		342,712
Retained Earnings		631,281		644,141

The adjustment of first quarter 2008 interest expense was as follows (in thousands, except per share data):

	Three Months Ended
	March 29, 2008
	As Adjusted		As Reported
Interest Expense	$	8,413	$	7,219
Income Before Taxes and
Noncontrolling Interests		49,583		50,777
Provision for Income Taxes		17,558		18,012
Net Income		32,025		32,765
Net Income Attributable to Regal Beloit Corporation		31,427		32,167
Earnings per Share of Common Stock
Basic	$	1.00	$	1.03
Assuming Dilution		0.95		0.97

The full year impact of the adjustment for the fiscal year ended December 27, 2008 reduced diluted earnings per share from $3.87 to $3.77.

3. INVENTORIES

Cost for approximately ~~66%~~61% of the Company’s inventory is determined using the last-in, first-out (LIFO) inventory valuation method. The approximate percentage distribution between major classes of inventories was as follows:

September 27, 2008 December 29, 2007
Raw Material 22% 21%
Work in Process 15% 14%
Finished Goods and Purchased Parts 63% 65%

	March 28, 2009	December 27, 2008
Raw Material and Work in Process	30%	29%
Finished Goods and Purchased Parts	70%	71%

3.4. ACQUISITIONS

The results of operations for acquired businesses are included in the Consolidated Financial Statements from the dates of acquisition. In January, 2009, the Company acquired Custom Power Technology (“CPT”), a custom power electronics business located in Menomonee Falls, Wisconsin. The purchase price and impact in our Condensed Consolidated Financial Statements was not significant. The following acquisitions in 2008 were not considered to be material business combinations.

2008 Acquisitions

On April 25, 2008 the Company acquired Joyce Court Holdings Ltd. and Grand Delight Investments Ltd., sole shareholders of Wuxi Hwada Motor Co. and Wuxi New Hwada Motor Co. (collectively “Hwada”) located in Wuxi, China. Hwada is a leading designer and manufacturer of Integral IEC and NEMA electric motors, which are used in various industrial applications such as compressor, pump, paper and steel processing and power plants. Approximately 50% of Hwada’s product sales are in the China industrial markets. The business is reported as part of the Company’s Electrical Segment. The purchase price was paid in cash ($27.6 million) plus the assumption of approximately $7.5 million in net liabilities. The purchase price allocations for Hwada are preliminary, pending the finalization of working capital adjustments and purchase price adjustments. Additionally, under the terms of the transaction, the Company will paysegment.

Return to ~~the seller up to $8.5 million received in the future upon the sale of certain real property rights owned by Hwada.~~Index

~~Subsequent to quarter end, on~~On September 30, 2008, the Company acquired Dutchi Motors B.V. ~~See Note 16 of Notes to Condensed Consolidated Financial Statements.~~

~~2007 Acquisitions~~

~~On August 31, 2007, the Company completed the acquisition of certain assets comprising the commercial and industrial division of the Fasco Motor business~~ (“~~Fasco”~~Dutchi”) from Tecumseh Products, Inc. and certain of its affiliates. On August 31, 2007, the Company also separately acquired the stock of Jakel Incorporated (“Jakel”). Both of the acquired businesses manufacture and market motors and blower systems for a variety of air moving applications including alternative fuel systems, water heaters, heating ventilating and air conditioning (HVAC) systems and other commercial products.

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~~On October 12, 2007, the Company acquired Morrill Motors (“Morrill”).~~located in Arnhem, The ~~acquired business~~Netherlands. Dutchi is a leading ~~designer~~distributor of industrial motors in Western and ~~manufacturer~~Eastern Europe, South Africa, Russia and the Middle East. Dutchi is one of ~~fractional horsepower motors and components for~~ the ~~commercial refrigeration and freezer markets. Included in~~largest distributors of the Company’s Hwada motor ~~offering are technology based variable speed~~ products.

~~On October 29, 2007, the Company acquired Alstom motors and fans business (“Alstom”) in India.~~ The Dutchi business is located in Kolkata, India and manufactures and markets a full range of low and medium voltage industrial motors and fans for the industrial and process markets in India. Alstom is noted for high quality process duty motors with a full range from 1 to 3500 hp. The purchase price was paid in cash.

The purchase price allocations for the Morrill and Alstom acquisitions are preliminary, pending the finalization of working capital adjustments and further analysis of contingencies. The combined purchase price, net of cash acquired, was $80.7 million. The excessreported as part of the purchase price over the estimated fair values of the net assets acquired was assigned to goodwill. Adjustments to the estimated fair values may be recorded during the allocation period, not to exceed one year from the date of acquisition.Company’s Electrical segment.

4.5. COMPREHENSIVE INCOME

The Company's comprehensive income ~~(loss)~~ for the three months ended March 28, 2009 and ~~nine months ended September 27,~~March 29, 2008, ~~and September 29, 2007,~~ respectively ~~were~~was as follows (in thousands):

	Three Months Ending
				(As Adjusted,
				See Note 2)
	March 28, 2009			March 29, 2008
Net income	$	13,976		$	32,025
Other Comprehensive Income (Loss) from:
Currency Translation adjustments		(3,970	)		1,323
Changes in fair value of hedging activities, net of tax		24,367			10,777
Hedging activities reclassified into earnings from accumulated
other comprehensive income (loss) ("AOCI"), net of tax		17,608			(440	)
Deferred losses on closed hedge contracts, net of tax		(14,785	)		-
Amortization of net prior service costs and actuarial losses		674			95
Comprehensive income	$	37,870		$	43,780

Three Months Ending Nine Months Ending
September 27, 2008
September 29,
2007
September 27, 2008
September 29,
2007

Net income as reported $ 36,906 $ 31,239 $ 107,149 $ 94,305
Comprehensive income (loss) from:
Translation adjustments (20,673 ) 3,510 (22,301 ) 10,322
Changes in fair value of hedging activities, net of tax (34,172 ) 205 (20,315 ) (3,285 )
Hedging activities reclassified into
earnings from accumulated other
comprehensive income (“AOCI”), net of tax 15,050 (665 ) 9,942 3,436
Amortization of net prior service costs and actuarial losses 177 179 73 535
Comprehensive income (loss) $ (2,712 ) $ 34,468 $ 74,548 $ 105,313

The amount of comprehensive income attributable to noncontrolling interests was $2.6 million and $1.1 million for the three months ended March 28, 2009 and March 29, 2008, respectively.

Foreign currency translation adjustments, unrealized gains and losses on derivative instruments and pension liability adjustments are included in ~~Shareholder’s Investment~~Equity under Accumulated Other Comprehensive ~~Income (Loss).~~Loss. The components of the ending balances of Accumulated Other Comprehensive ~~Income (Loss)~~Loss are as follows:

September 27, 2008 December 29, 2007
Translation adjustments $ (1,021 ) $ 21,280
Hedging activities, net of tax (20,953 ) (10,580 )
Pension and post retirement benefits, net of tax (8,447 ) (8,520 )
$ (30,421 ) $ 2,180

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The Company is, from time to time, party to litigation that arises in the normal course of its business operations, including product warranty and liability claims, contract disputes and environmental, asbestos, employment and other litigation matters. The Company’s products are used in a variety of industrial, commercial and residential applications that subject us to claims that the use of our products is alleged to have resulted in injury or other damage. The Company accrues for anticipated costs in defending against such lawsuits ~~arising from its normal business operations. It is believed~~in amounts that we believe are adequate, and the Company does not believe that the outcome of ~~these lawsuits~~any such lawsuit will have noa material effect on the Company’s financial position or its results of operations.

The Company recognizes the cost associated with its standard warranty on its products at the time of sale. The amount recognized is based on historical experience.

~~14.~~15. DERIVATIVE INSTRUMENTS

The Company ~~periodically enters into~~has adopted FASB Statement No. 161, “Disclosures about Derivative Instruments and Hedging Activities” (“SFAS 161”) in the three months ended March 28, 2009. SFAS 161 amends the required disclosures about the Company’s derivative instruments and hedging activities contained in SFAS 133 “Accounting for Derivative Instruments and Hedging Activities” (“SFAS 133”).

The Company is exposed to certain risks relating to its ongoing business operations. The primary risks managed by using derivative instruments are commodity ~~futures~~price risk, currency exchange, and ~~options hedging transactions to reduce the impact of changing prices for~~interest rate risk. Forward contracts on certain commodities ~~such~~are entered into to manage the price risk associated with forecasted purchases of materials used in the Company’s manufacturing process. Forward contracts on certain currencies are entered into to manage forecasted cash flows in certain foreign currencies. Interest rate swaps are entered into to manage interest rate risk associated with the Company’s floating rate borrowings.

SFAS 133 requires companies to recognize all derivative instruments as ~~copper and aluminum based upon certain firm commitments to purchase such commodities. These transactions are designated~~either assets or liabilities at fair value in the statement of financial position. In accordance with SFAS 133, the Company designates commodity forward contracts as cash flow hedges of forecasted purchases of commodities, currency forward contracts as cash flow hedges of forecasted

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foreign currency cash flows and ~~the contract terms~~interest rate swaps as cash flow hedges of ~~commodity~~forecasted LIBOR-based interest payments. There were no significant collateral deposits on derivative financial instruments as of March 28, 2009.

Cash flow hedges

For derivative instruments that are designated and qualify as a cash flow hedge, ~~instruments generally mirror those of the hedged item, providing a high degree of risk reduction and correlation. Derivative~~

commodity liabilities of $12.9 million and $0.6 million are recorded in Other Accrued Expenses and Other Noncurrent Liabilities, respectively at September 27, 2008. Derivative commodity liabilities of $6.1 million are recorded in Other Accrued Expenses at December 29, 2007. The unrealized loss on the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income or loss and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or changes in market value of derivatives not designated as hedges are recognized in current earnings.

As of March 28, 2009, the Company had outstanding the following commodity forward contracts (with maturities extending through February 2011) to hedge forecasted purchases of ~~($8.4) million net~~commodities (in millions):

	Notional
	Amount
Copper	$	57.4
Aluminum		3.2
Zinc		1.1
Natural Gas		1.6
Heating Oil		0.3

As of ~~tax and ($3.8) million net~~March 28, 2009, the Company had outstanding the following currency forward contracts (with maturities extending through December 2011) to hedge forecasted foreign currency cash flows (in millions):

	Notional
	Amount
Mexican Peso	$	120.6
Indian Rupee		56.9
Thai Baht		7.0
Australian Dollar		2.5

As of ~~tax,~~March 28, 2009, the total notional amount of the Company’s receive-variable/pay-fixed interest rate swaps was $250.0 million.

Fair values of derivative instruments as of ~~September 27, 2008 and December 29, 2007, respectively,~~March 28, 2009 were (in millions):

	Asset Derivatives		Liability Derivatives
	Fair Value		Balance Sheet Location	Fair Value
Derivatives designated as hedging instruments
Interest rate swap contracts	$	-	Hedging Obligations	$	44.5
Foreign exchange contracts		-	Hedging Obligations		31.6
Commodity contracts		-	Hedging Obligations		22.0

Total derivatives designated as hedging instruments	$	-		$	98.1

Derivatives not designated as hedging instruments
Foreign exchange contracts		-	Hedging Obligations		0.5
Commodity contracts		-	Hedging Obligations		3.5

Total derivatives not designated as hedging instruments	$	-		$	4.0

Total derivatives	$	-		$	102.1

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The effect of derivative instruments on the Statement of Earnings for the three months ended March 28, 2009 was ~~recorded in Accumulated Other Comprehensive Income (“AOCI”).~~(in millions):

Derivatives Designated as Cash Flow Hedging Instruments
	Commodity Forwards			Currency Forwards			Interest Rate Swaps			Total
Gain (loss) recognized in
Other Comprehensive Income (Loss)	$	40.4		$	(1.6	)	$	5.1		$	43.9

Loss recognized in Cost of Sales		(22.1	)		(2.4	)		-			(24.5	)

Loss recognized in Operating Expenses		-			(1.7	)		-			(1.7	)

Loss recognized in Interest Expense		-			-			(2.2	)		(2.2	)

The Company uses a cash flow hedging strategy to protect against an increase in the cost of forecasted foreign currency denominated transactions. As of September 27, 2008, derivative currency liabilities of $2.4 million and $0.3 million are recorded in Other Accrued Expenses and Other Noncurrent Liabilities, respectively. As of December 29, 2007, derivative currency assets of $3.4 million and $0.1 million are recorded in Prepaid Expenses and Other Current Assets and Other Noncurrent Liabilities, respectively. The unrealized (loss) gain on the effectiveineffective portion of hedging instruments recognized during the ~~contracts of ($1.3) million net of tax and $2.1 million net of tax, as of September 27, 2008 and December 29, 2007,~~three months ended March 28, 2009 was ~~recorded in AOCI.~~immaterial.

The Company has LIBOR-based floating rate borrowings, which expose the Company to variability in interest payments due to changes in interest rates. The Company has entered into pay fixed/receive LIBOR-based floating interest rate swaps to manage fluctuations in cash flows resulting from interest rate risk. These interest rate swaps have been designated as cash flow hedges against forecasted LIBOR-based interest payments. As of September 27, 2008, an interest rate swap liability of $18.1 million was included in Other Noncurrent Liabilities. The unrealized loss on the effective portion of the contracts of ($11.2) million net of tax as of September 27, 2008 was recorded in AOCI. As of December 29, 2007, an interest rate swap liability of $14.4 million was included in Other Noncurrent Liabilities. The unrealized loss on the effective portion of the contracts of ($8.9) million net of tax as of December 29, 2007 was recorded in AOCI.

Derivatives Not Designated as Cash Flow Hedging Instruments
	Commodity Forwards		Currency Forwards			Total
Gain (loss) recognized in Cost of Sales	$	4.5	$	(0.6	)	$	3.9

Loss recognized in Operating Expenses		-		(0.5	)		(0.5	)

The net AOCI balance of ($~~21.0)~~71.7) million loss at ~~September 27, 2008 is comprised of~~March 28, 2009 includes ($~~9.2)~~46.2) million of net current deferred losses expected to be realized in the next ~~year, and ($11.8) million of net non-current deferred losses. The impact of hedge ineffectiveness was immaterial for all periods presented.~~

year.

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~~15.~~16. FAIR VALUE

The implementation of SFAS No. 157 “Fair Value Measurements” ~~for financial assets and financial liabilities, on December 30, 2007, the first day of the 2008 fiscal year,~~(“SFAS No. 157”) did not have a material impact on our ~~consolidated financial position and results of operations. The Company is currently assessing the impact of SFAS No. 157 for nonfinancial assets and nonfinancial liabilities on its~~condensed consolidated financial position and results of operations.

SFAS No. 157 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). SFAS No. 157 classifies the inputs and used to measure fair value into the following hierarchy:

Level 1		Unadjusted quoted prices in active markets for identical assets or liabilities

Level 2		Unadjusted quoted prices in active markets for similar assets or liabilities, or

		Unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or

		Inputs other than quoted prices that are observable for the asset or liability

Level 3		Unobservable inputs for the asset or liability

The Company uses the best available information in measuring fair value. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company has determined that ~~our~~its financial assets and liabilities are level 2 in the fair value hierarchy. The following table sets ~~for~~forth the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of ~~September 27, 2008 (in~~March 28, 2009 (n millions):

Liabilities:
Other Accrued Expenses
      Derivative currency contracts $ 2.4
Derivative commodity contracts 12.9
Other Noncurrent Liabilities
Derivative currency contracts $ 0.3
      Derivative commodity contracts 0.6
      Interest rate swap 18.1

Liabilities:
Hedging Obligations - Current
Derivative currency contracts	$	21.3
Derivative commodity contracts		25.5
Hedging Obligations - Long Term
Derivative currency contracts	$	10.8
Interest rate swap		44.5

~~16.~~ ~~SUBSEQUENT EVENT~~

On September 30, 2008, the Company acquired Dutchi Motors B.V. (“Dutchi”) located in Arnhem, The Netherlands. Dutchi is a leading distributor of industrial motors in Western and Eastern Europe, South Africa, Russia and the Middle East. Dutchi is one of the largest distributors of the Company’s Hwada motor products, which was purchased by the Company in April 2008. The Dutchi business will be reported as part of the Company’s Electrical Segment. The purchase price was approximately $34.0 million in cash and the assumption of approximately $3.2 million in net liabilities.

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ITEM 22.. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

~~OPERATIONS~~

Unless the context requires otherwise, references in this Item 2 to “we”, “us”, “our” or the “Company” refer collectively to Regal Beloit Corporation and its subsidiaries. All amounts referred to in this Management’s Discussion and Analysis of Financial Condition and Results of Operations reflect the adjustment of convertible debt and related interest expense discussed in Note 2 of Notes to the Condensed Consolidated Financial Statements.

OVERVIEW

Net sales ~~increased 38.1%~~decreased 17.4% to ~~$620.6~~$443.3 million from ~~$449.4~~$536.3 million in the comparable period of ~~2007.~~2008. Sales for the three months ended ~~September 27, 2008~~March 28, 2009 included ~~$122.6~~$29.7 million of sales related to the ~~four 2007~~two 2008 acquired businesses described in Note 34 of Notes to the Condensed Consolidated Financial ~~Statements. An additional $34.2 million of~~Statementsand the ~~2008 sales are attributable to the Hwada~~CPT acquisition completed on ~~April 25, 2008.~~

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January 2, 2009.

Net income ~~increased 18.1%~~decreased 59.3% to ~~$36.9~~$12.8 million for the three months ended ~~September 27, 2008~~March 28, 2009 as compared to ~~$31.2~~$31.4 million in the comparable period last year. Diluted earnings per share ~~increased 18.5%~~decreased 58.9% to ~~$1.09~~$0.39 for the three months ended ~~September 27, 2008~~March 28, 2009 as compared to ~~$0.92~~$0.95 for the comparable period of ~~2007.~~2008.

RESULTS OF OPERATIONS

Three Months Ended ~~September 27, 2008~~March 28, 2009 versus Three Months Ended ~~September~~March 29, ~~2007~~2008

Sales for the three months ended ~~September 27, 2008~~March 28, 2009 were ~~$620.6~~$443.3 million, a ~~38.1% increase~~17.4% decrease over the ~~$449.4~~$536.3 million reported for the three months ended for ~~September~~March 29, ~~2007. Third~~2008. First quarter ~~2008~~2009 sales included ~~$122.6~~$29.7 million of sales related to the ~~four 2007~~two 2008 acquired businesses described in Note 34 of Notes to the Condensed Consolidated Financial ~~Statements. An additional $34.2 million of~~Statements and the ~~third quarter 2008 sales are attributable to the Hwada~~CPT acquisition completed on ~~April 25, 2008.~~January 2, 2009.

In the Electrical segment, sales ~~increased 42.5%,~~decreased 17.4% from the prior year period, including the impact of the acquisitions noted above. Exclusive of the acquired businesses, Electrical segment sales ~~are up 10.8%~~decreased 23.7%, largely due to global generator sales ~~increasing 25.0%~~decreasing 12%, commercial and industrial motors sales in North America ~~increasing 9.1%~~decreasing 23%, and residential HVAC motor sales ~~increased 10.9%~~decreasing 22%. ~~Sales in our Sinya business in China were down 23.1% for the three months ended September 27, 2008 versus the comparable period of 2007 due to the in-sourcing of motor production by a large customer.~~ Sales in the Mechanical segment ~~increased 5.3%~~decreased 17.0% from the prior year period. From a geographic perspective, Asia-based sales ~~increased 101.1%~~decreased 24.2% as compared to the comparable period of ~~2007.~~2008. In total, sales to regions outside of the United States were ~~26.8%~~26.7% of total sales for the three months ended ~~September 27, 2008~~March 28, 2009 in comparison to ~~19.4%~~25.6% for the comparable period of ~~2007.~~2008. The negative impact of foreign currency exchange rate changes decreased total sales by 2.4%.

The gross profit margin for the three months ended ~~September 27, 2008~~March 28, 2009 was ~~21.4%~~20.4% as compared to the ~~23.7%~~22.8% reported for the comparable period of ~~2007. Lower~~2008. The gross profit ~~margins of 17.3% from~~margin for the ~~acquired businesses, and higher material costs had a significant impact on~~Electrical segment was 19.6% for the three months ended ~~September 27, 2008, partially offset by the contribution from new products, productivity efforts, pricing actions, and product mix. The raw material cost increases resulted primarily from increases~~March 28, 2009 versus 21.9% in the ~~cost~~comparable period of ~~copper~~2008. The Mechanical segment gross profit was 26.9% in the three months ended March 28, 2009 versus 29.1% in the comparable period of 2008. The decrease is driven by higher commodity costs and ~~steel.~~the absorption impact of lower sales volumes.

Operating expenses were ~~$67.1~~$62.4 million ~~(10.8%~~(14.1% of sales) in the three months ended ~~September 27, 2008~~March 28, 2009 versus ~~$53.3~~$64.5 million ~~(11.9%~~(12.0% of sales) in ~~2007.~~ the comparable period of 2008. Operating expenses included approximately $5.1 million related to the Dutchi and Hwada businesses offset by reductions in variable expenses, such as sales commissions, and the impact of cost reduction activities. Electrical segment operating expenses were 14.0% of net sales for the three months ended March 28, 2009 versus 11.9% in the comparable period of 2008. Mechanical operating expenses for the first quarter of 2009 were 14.8% of sales versus 13.0% in 2008.

Income from operations was ~~$65.7~~$28.2 million versus ~~$53.4~~$57.6 million in the comparable period of ~~2007.~~2008. As a percent of sales, income from operations was ~~10.6%~~6.4% for the three months ended ~~September 27, 2008~~March 28, 2009 versus ~~11.9%~~10.7% in the comparable period of ~~2007. This decrease reflected lower~~2008. As a percent of sales, Electrical segment operating profit ~~margins from~~was 5.6% in the ~~acquired businesses, and increased raw material costs partially offset by contributions from new products, pricing actions, and productivity~~.first quarter of 2009 versus 10.0% in the comparable period of 2008. Mechanical segment operating profit was 12.1% of sales in the first quarter of 2009 versus 16.1% in the comparable period of 2008.

Net interest expense was ~~$6.7~~$7.0 million versus ~~$4.8~~$8.0 million in the comparable period of ~~2007.~~2008. The ~~increase~~decrease is ~~due to higher levels of average debt outstanding~~ driven by lower interest rates in 2009 versus the ~~acquisitions completed since August 2007.~~comparable period of 2008.

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The effective tax rate for the three months ended ~~September 27, 2008~~March 28, 2009 was ~~36.0%~~34.1% versus ~~34.2%~~35.4% in the prior year period. The increase in the effective tax rate results from the global distribution of income, increases in certain statutory tax rates in Mexico and China, and the impact of the expiration of the United States Research and Engineering tax credit which had not been extended to 2008 as of September 27, 2008. A dividend repatriation benefit recognized in the three months ended September 27, 2008 was offset by the impact of losses incurred in our Sinya business which is under tax holiday for 2008.

Net income for the three months ended September 27, 2008 was $36.9 million, an increase of 18.1% versus the $31.2 million reported in comparable period of 2007. Fully diluted earnings per share was $1.09 as compared to $0.92 per share reported in the third quarter of 2007. The average number of diluted shares was 33,715,881 during the three months ended September 27, 2008 as compared to 34,104,123 during the comparable period last year.

~~Nine Months Ended September 27, 2008 versus Nine Months Ended September 29, 2007~~

Sales for the nine months ended September 27, 2008 were $1.76 billion, which is a 32.8% increase over the $1.33 billion reported for the comparable period of 2007. Sales for the nine months ended September 27, 2008 included $343.0 million of sales related to the four 2007 acquired businesses described in Note 3 of Notes to the Consolidated Financial Statements. An additional $57.5 million of sales in the nine months ended September 27, 2008 relate to the Hwada business acquired on April 25, 2008.

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In the Electrical segment, sales increased 37.1%, including the impact of the acquisitions noted above. Exclusive of the acquired businesses, Electrical segment sales are up 53% largely due to global generator sales increasing 25.2%, commercial and industrial motors sales in North America increasing 5.0%, and residential HVAC motor sales increasing 0.9%. Sales in our Sinya business in China were down 14.2% for the nine months ended September 27, 2008 versus the comparable period of 2007 due to the in-sourcing of motor production by a large customer. Sales in the Mechanical segment increased 2.2% from the prior year period. From a geographic perspective, Asia-based sales increased 86.9% as compared to the comparable period of 2007. In total, sales to regions outside of the United States were 26.5% of total sales in comparison to 20.5% for the comparable period of 2007.

Gross margin for the nine months ended September 27, 2008 was 21.9%, which is 1.3 percentage points lower than the comparable period of 2007. Lower operating margins from the acquired businesses, and material costs had a significant impact on the first six months of 2008, partially offset by the contribution from new products, productivity efforts, pricing actions and positive product mix across our entire business. The raw material cost increases resulted primarily from increases in the costs of copper and steel.

Operating expenses for the nine months ended September 27, 2008 were $195.2 million (11.1% of sales) versus $147.1 million (11.1% of sales) in the comparable period of 2007. Income from operations was $190.8 million versus $160.8 million in the comparable period of 2007, an increase of 18.7%. As a percent of sales, income from operations was 10.8% versus 12.1% in the comparable period of 2007.

Net interest expense was $20.1 million versus $13.9 million in the comparable period of 2007. This increase is driven mainly by the higher levels of debt outstanding, from the acquisitions completed since August 2007.

~~The tax rate for the nine months ended September 27, 2008 was 35.6% versus 34.3% in the prior year comparable period. The increase~~decrease in the effective tax rate results primarily from the global distribution of income.

Net income increases in certain statutory tax rates in Mexico and China, and the impact of the expiration of the United States Research and Engineering tax credit which had not been extended to 2008 as of September 27, 2008. A dividend repatriation benefit recognized infor the three months ended ~~September 27, 2008~~March 28, 2009 was ~~offset by~~$12.8 million, a decrease of 59.3% versus the ~~impact~~$31.4 million reported in the comparable period of ~~losses incurred~~2008. Fully diluted earnings per share was $0.39 as compared to $0.95 per share reported in ~~our Sinya business which is under tax holiday for~~the first quarter of 2008. The average number of diluted shares was 32,594,802 during the three months ended March 28, 2009 as compared to 33,117,034 during the comparable period of 2008.

LIQUIDITY AND CAPITAL RESOURCES

~~Our working~~Working capital was ~~$477.5~~$486.1 million at ~~September 27, 2008,~~March 28, 2009, a ~~14.6%~~13.0% increase from ~~$416.6~~$430.3 million at ~~year-end 2007.~~December 27, 2008. The ~~$60.9~~$55.8 million increase was primarily driven by a ~~$19.3~~$49.5 million ~~increase~~decrease in ~~net working capital from the Hwada acquisition~~accounts payable and ~~an increase~~a $33.8 million decrease in current hedging obligations offset by a $21.7 million decrease in accounts receivable ~~driven by higher sales~~and a $32.6 million decrease in ~~the third quarter of 2008 versus the fourth quarter of 2007.~~inventory. The ratio of ~~our~~ current assets to our current liabilities (“current ratio”) was ~~2.1:~~2.5:1 at ~~September 27, 2008~~March 28, 2009 and ~~2.3:~~2.0:1 at December ~~29, 2007.~~27, 2008.

Net cash provided by operating activities was ~~$158.6~~$21.6 million for the ~~nine~~three months ended ~~September 27, 2008~~March 28, 2009 as compared to ~~$168.3~~$34.9 million in the comparable period of ~~2007. Increases in~~2008. The decrease is driven by lower net income ~~and depreciation and amortization were offset by higher net working capital investment~~ in ~~2008~~2009 versus ~~2007.~~the comparable period of 2008. Net cash used in investing activities was ~~$57.6~~$9.3 million in the first ~~nine~~three months of ~~2008~~2009 as compared to the ~~$276.9~~$12.1 million used in the comparable period of the prior ~~year driven by the Fasco and Jakel acquisitions.~~year. Additions to property, plant and equipment were ~~$43.9~~$8.1 million in the first ~~nine~~three months of ~~2008,~~2009, which was ~~$20.1~~$5.5 million ~~more~~less than the comparable period of ~~2007. The change in capital spending results from increased investments in productivity and new product projects.~~2008. Our cash ~~used in~~provided by financing activities was ~~$28.9~~$8.0 million for the first ~~nine~~three months of ~~2008~~2009 versus ~~$126.1~~$15.4 million ~~provided by~~used in financing activities in the comparable period of ~~2007.~~2008. During the ~~nine~~three months ended ~~September 27,~~March 29, 2008, the Company repurchased 110,000 shares at a total cost of $4.2 million. There were no shares repurchased in ~~the equivalent period of 2007.~~2009.

Our outstanding long-term debt ~~decreased~~increased from ~~$558.9~~$560.1 million at December ~~29, 2007~~27, 2008 to ~~$554.1~~$580.3 million at ~~September 27, 2008.~~March 28, 2009. At ~~September 27, 2008~~March 28, 2009, there was ~~$13.0~~$39.2 million outstanding under our $500.0 million unsecured revolving credit facility that expires on April 30, 2012 (the “Facility”). The Facility permits the Company to borrow at interest rates based upon a margin above the London Inter-Bank Offered Rate (“LIBOR”), which margin varies with the ratio of total funded debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”) as defined in the Facility. These interest rates also vary as LIBOR varies. We pay a commitment fee on the unused amount of the Facility, which also varies with the ratio of our total debt to our EBITDA.

~~On June 16,~~In 2008, the Company entered into a Term Loan Agreement (“Term Loan”) with certain financial institutions, whereby the Company borrowed an aggregate principal amount of $165.0 million. The Term Loan matures in June 2013, and borrowings under the Term Loan generally bear interest at a variable rate equal to (i) a margin over the LIBOR, which margin varies depending on whether certain criteria are satisfied, or (ii) the alternate base rate as defined in the agreement. At ~~September 27, 2008,~~March 28, 2009, the interest rate of ~~3.7%~~1.6% was based on a margin over LIBOR.

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At ~~September 27, 2008,~~March 28, 2009, there was $250.0 million of senior notes (the “Notes”) outstanding. The Notes were issued and sold in two series: $150.0 million in Floating Rate Series 2007A Senior Notes, Tranche A, due August 23, 2014, and $100.0 million in Floating Rate Series 2007A Senior Notes, Tranche B, due August 23, 2017. The Notes bear interest at a margin over LIBOR, which margin varies with the ratio of the Company’s consolidated debt to consolidated EBITDA as defined in the Agreement. These interest rates also vary as LIBOR varies. The ~~note Purchase~~ Agreement ~~(the “Agreement”)~~ permits the Company to issue and sell additional note series, subject to certain terms and conditions described in the Agreement, up to a total of $600.0 million in combined Notes.

The Notes, the Term Loan and the Facility require us to meet specified financial ratios and to satisfy certain financial condition tests. We were in compliance with all debt covenants as of ~~September 27, 2008.~~March 28, 2009.

In addition to the Facility, the Term Loan and the Notes, at ~~September 27, 2008,~~March 28, 2009, we also had $115.0 million of convertible senior subordinated debt outstanding at a fixed interest rate of 2.75%, and ~~$28.2~~$18.2 million of other debt ~~(including approximately $17.0 million assumed in the Hwada purchase,~~ with a weighted average interest rate of ~~7.5%~~3.9%.)

CRITICAL ACCOUNTING POLICIES

The Company’s critical accounting policies have not changed materially from those reported in our ~~2007~~2008 Annual Report on Form 10-K filed on February ~~27, 2008.~~25, 2009.

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New Accounting Pronouncements

In May 2008, the Financial Accounting Standards Board (“FASB”) issued FASB Staff Position APB 14-1, “Accounting for Convertible Debt Instruments that May Be Settled in Cash Upon Conversion (Including Partial Cash Settlement)” (“APB 14-1”), which requires that convertible debt securities, that upon conversion may be settled by the issuer fully or partially in cash, be split into a debt and equity component. APB 14-1 is effective for fiscal years (and interim periods) beginning after December 15, 2008 and must be applied retroactively to all past periods presented. The Company ~~will adopt~~adopted APB 14-1 ~~upon~~on its effective ~~date, which will have a material impact on the reported values~~date. (See Note 2 of ~~debt, equity and earnings per share.~~Notes to Condensed Consolidated Financial Statements.)

~~In April 2008, the FASB issued FASB Staff Position (FSP) 142-3,~~ ~~“Determination of the Useful Life of Intangible Assets”~~ ~~(“FSP 142-3”). FSP 142-3 intends to improve the consistency between the useful life of a recognized intangible asset under SFAS 142,~~ ~~“Goodwill and Other Intangible Assets”~~ ~~and the period of expected cash flows used to measure the fair value of the asset under SFAS 141 (Revised 2007),~~ ~~“Business Combinations”,~~ ~~which is effective for fiscal years (and interim periods) beginning after December 15, 2008. We are evaluating FSP 142-3 to determine the effect on our financial statements and related disclosures.~~

In March 2008, the FASB issued SFAS 161, “Disclosures about Derivative Instruments and Hedging Activities” (“SFAS 161”), which requires expanded disclosures about derivative instruments and hedging activities. SFAS 161 is effective for fiscal years and interim periods beginning after November 15, 2008, with earlier adoption permitted. ~~We are evaluating~~The Company has adopted the new standard ~~to determine its effect on~~in our financial statements and related ~~disclosures.~~disclosures beginning in the first quarter of 2009. (See Note 15 of Notes to Condensed Consolidated Financial Statements.)

In December 2007, the FASB issued SFAS 141 (Revised 2007), “Business Combinations” (“SFAS 141R”), effective prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. SFAS 141R ~~establishes~~established principles and requirements on how an acquirer recognizes and measures in its financial statements identifiable assets acquired, liabilities assumed, noncontrolling interest in the acquiree, goodwill or gain from a bargain purchase and accounting for transaction costs. Additionally, SFAS 141R determines what information must be disclosed to enable users of the financial statements to evaluate the nature and financial effects of the business combination. The Company ~~will adopt~~has adopted SFAS 141R upon its effective date as appropriate for any future business combinations.

In December 2007, the FASB also issued SFAS 160, “Noncontrolling Interests in Consolidated Financial Statements, an amendment of ARB No. 51” (“SFAS 160”). SFAS 160 ~~will change~~changed the accounting and reporting for minority interests, which will be recharacterized as noncontrolling interests ~~(NCI)~~ and classified as a component of equity. This new consolidation method will significantly change the accounting for transactions with minority interest holders. SFAS 160 is effective for fiscal years beginning after December 15, 2008. ~~We have not yet determined~~The Company has adopted the ~~impact, if any,~~new standard in our financial statements and related disclosures beginning in the first quarter of ~~SFAS 160 on our consolidated financial statements.~~2009.

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~~In February 2007, the FASB issued SFAS 159, “The Fair Value Option for Financial Assets and Financial Liabilities”~~, including an Amendment of FASB Statement No. 115 (“SFAS 159”). SFAS 159 permits entities to choose to measure many financial instruments and certain other items generally on an instrument-by-instrument basis at fair value that are not currently required to be measured at fair value. SFAS 159 is intended to provide entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. The implementation of this standard did not have an impact on our consolidated financial position and results of operations.

In September 2006, the FASB issued SFAS 157, “Fair Value Measurements”(“ (“SFAS 157”). SFAS 157 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. In February, 2008 the FASB issued FSP FAS 157-2, which delays the effective date of Statement 157 for all nonrecurring fair value measurements of nonfinancial assets and nonfinancial liabilities until fiscal years beginning after November 15, 2008. The Company is eligible for the delay as it has not previously adopted SFAS 157. The Company has ~~chosen to partially adopt~~adopted SFAS 157 ~~(see Note 15 of Notes to Condensed Consolidated Financial Statements).~~in 2008 for financial assets as permitted.

ITEM 33.. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The following information should be read in conjunction with the Company’s 2008 Annual Report on Form 10-K filed on February 25, 2009. Updated information on the Company’s use of derivative financial instruments is contained in Note 15 of Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q.

We are exposed to market risk relating to the Company’s operations due to changes in interest rates, foreign currency exchange rates and commodity prices of purchased raw materials. We manage the exposure to these risks through a combination of normal operating and financing activities and derivative financial instruments such as interest rate swaps, commodity cash flow hedges and foreign currency forward exchange contracts.

The Company is exposed to interest rate risk on certain of its short-term and long-term debt obligations used to finance our operations and acquisitions. At ~~September 27, 2008,~~March 28, 2009, net of interest rate swaps, we had ~~$390.4~~$380.4 million of fixed rate debt and ~~$180.8~~$206.9 million of variable rate debt, the latter subject to interest rate risk. As a result, interest rate changes impact future earnings and cash flows assuming other factors are constant. The Company utilizes interest rate swaps to manage fluctuations in cash flows resulting from exposure to interest rate risk on forecasted variable rate interest payments.

~~Details regarding the instruments, as of September 27, 2008, are as follows:~~

~~Instrument~~	~~Notional~~ ~~Amount~~	~~Maturity~~	~~Rate~~ ~~Paid~~	~~Rate Received~~	~~Fair Value~~ ~~Gain (Loss)~~
~~Swap~~	~~$150.0 million~~	~~August 23, 2014~~	~~5.3%~~	~~LIBOR (3 month)~~	~~($9.7) million~~
~~Swap~~	~~$100.0 million~~	~~August 23, 2017~~	~~5.4%~~	~~LIBOR (3 month)~~	~~($8.4) million~~

A hypothetical 10% change in our weighted average borrowing rate on outstanding variable rate debt at ~~September 27, 2008,~~March 28, 2009, would result in a change in after-tax annualized earnings of approximately $~~0.4~~0.2 million.

The Company periodically enters into commodity futures and options hedging transactions to reduce the impact of changing prices for certain commodities, such as copper and aluminum. Contract terms of commodity hedge instruments generally mirror those of the hedged item, providing a high degree of risk reduction and correlation.

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We are also exposed to foreign currency risks that arise from normal business operations. These risks include the translation of local currency balances of foreign subsidiaries, intercompany loans with foreign subsidiaries and transactions denominated in foreign currencies. Our objective is to minimize our exposure to these risks through a combination of normal operating activities and the utilization of foreign currency contracts to manage our exposure on the transactions denominated in currencies other than the applicable functional currency. Contracts are executed with creditworthy banks and are denominated in currencies of major industrial countries. It is our policy not to enter into derivative financial instruments for speculative purposes. We do not hedge our exposure to the translation of reported results of foreign subsidiaries from local currency to United States dollars.

All hedges are recorded on the balance sheet at fair value and are accounted for as cash flow hedges, with changes in fair value recorded in accumulated other comprehensive income (“AOCI”) in each accounting period. An ineffective portion of the hedge’s change in fair value, if any, is recorded in earnings in the period of change. The impact due to ineffectiveness was immaterial for all periods included in this report.

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The Company periodically enters into commodity futures and options hedging transactions to reduce the impact of changing prices for certain commodities such as copper and aluminum based upon certain firm commitments to purchase such commodities. These transactions are designated as cash flow hedges and the contract terms of commodity hedge instruments generally mirror those of the hedged item, providing a high degree of risk reduction and correlation. Derivative commodity liabilities of $12.9 million and $0.6 million are recorded in Other Accrued Expenses and Other Noncurrent Liabilities, respectively at September 27, 2008. Derivative commodity liabilities of $6.1 million are recorded in Other Accrued Expenses at December 29, 2007. The unrealized loss on the effective portion of the contracts of ($8.4) million net of tax and ($3.8) million net of tax, as of September 27, 2008 and December 29, 2007, was recorded in AOCI.

The Company uses a cash hedging strategy to protect against an increase in the cost of forecasted foreign currency denominated transactions. As of September 27, 2008, derivative currency liabilities of $2.4 million and $0.3 million are recorded in Other Accrued Expenses and Other Noncurrent Liabilities, respectively. As of December 29, 2007, derivative currency assets of $3.4 million and $0.1 million (notional value of $213.3 million) are recorded in Prepaid Expenses and Other Current Assets and Other Noncurrent Liabilities, respectively. The unrealized (loss) gain on the effective portion of the contracts of ($1.3) million net of tax and $2.1 million net of tax, as of September 27, 2008 and December 29, 2007, was recorded in AOCI.

The Company has LIBOR-based floating rate borrowings, which expose the Company to variability in interest payments due to changes in interest rates. The Company has entered into pay fixed/receive LIBOR-based floating interest rate swaps to manage fluctuations in cash flows resulting from interest rate risk. These interest rate swaps have been designated as cash flow hedges against forecasted LIBOR-based interest payments. As of September 27, 2008 and December 29, 2007, an interest rate swap liability of $18.1 million and $14.4 million was included in Other Noncurrent Liabilities, respectively. The unrealized loss on the effective portion of the contracts of ($11.2) million and ($8.9) million, net of tax as of September 27, 2008 and December 29, 2007 respectively, was recorded in AOCI.

The net AOCI balance of ($21.0) million gain at September 27, 2008 is comprised of ($9.2) million of net current deferred losses expected to be realized in the next year, and ($11.8) million of net non-current deferred losses. The impact of hedge ineffectiveness was immaterial for all periods presented.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures. The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective to ensure that (a) information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission, and (b) information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Internal Control Over Financial Reporting. There were no changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II - OTHER INFORMATION

Items 3, 4 and 5 are inapplicable and have been omitted.

ITEM 1. LEGAL PROCEEDINGS

On ~~April 26, 2007,~~December 18, 2008, the Company ~~received notice that the~~entered into a consent decree with U.S. Environmental Protection Agency (“U.S. EPA”) ~~has filed~~to resolve the matters alleged by the U.S. EPA in an action filed against the Company in April 2007 in the United States District Court for the Northern District of Illinois seeking reimbursement of the U.S. EPA’s unreimbursed past and future remediation costs incurred in cleaning up an environmental site located near a former manufacturing facility of the Company in Illinois. In 1999, the Company and other parties identified as potentially responsible parties (“PRPs”) reached an agreement with the U.S. EPA to partially fund the costs of certain response actions taken with respect to this site. In 2004, the Company received communications from the U.S. EPA indicating that the Company was identified as one of three PRPs regarding additional remedial actions to be taken by the U.S. EPA at this site. In response, the Company provided to the U.S. EPA its environmental expert’s assessment of the site in 2004. The Company ~~believes~~does not believe that it is ~~not~~ a ~~PRP~~potentially responsible party with respect to the site in question and ~~intends to defend vigorously the associated claim. As of September 27, 2008 amounts that have been recorded~~did not admit any fault or liability in the ~~Company’s financial statements related~~consent decree with respect to the allegations made by the U.S. EPA in this ~~contingency are not material.~~

matter. Under the terms of the consent decree, the U.S. EPA withdrew the action filed against the Company and the Company agreed to make a monetary payment, which included contributions from other involved parties. The payment was made by the Company in the first quarter of 2009.

The Company is, from time to time, party to litigation that arises in the normal course of our business operations, including product warranty and liability claims, contract disputes and environmental, asbestos, employment and other litigation matters. The Company’s products are used in a variety of industrial, commercial and residential applications that subject us to claims that the use of our products is alleged to have resulted in injury or other damage. The Company accrues for anticipated costs in defending against such lawsuits ~~arising from its normal business operations. It is believed~~in amounts that we believe are adequate, and the Company does not believe that the outcome of ~~these other lawsuits~~any such lawsuit will have noa material effect on the Company’s financial position or its results of operations.

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ITEM 1A. RISK FACTORS

The business and financial results of the Company are subject to numerous risks and uncertainties. The risks and uncertainties have not changed materially from those reported in Item 1A in the ~~2007~~2008 Annual Report on Form ~~10-K.~~10-K filed on February 25, 2009.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table contains detail related to the repurchase of common stock based on the date of trade during the three months ended ~~September 27, 2008.~~March 28, 2009.

2008
Fiscal Month

Total Number
of Shares
Purchased

Average
Price Paid
per Share

Total Number of
Shares Purchased as
Part of Publicly
Announced Plans or
Programs

Maximum Number
of Shares that May
Be Purchased
Under the Plan or
Programs

June 29, 2008 to August 2, 2008 - $ - - 2,115,900

August 3, 2008 to August 30, 2008 69,359 $ 48.55 - 2,115,900

August 31, 2008 to September 27, 2008 - $ - - 2,115,900

Total 69,359 -

2009 Fiscal Month	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares that May Be Purchased Under the Plan or Programs
December 28, 2008 to January 31, 2009		-	$	-		-		2,115,900

February 1, 2009 to February 28, 2009		56,601	$	31.74		-		2,115,900

March 1, 2009 to March 28, 2009		-	$	-		-		2,115,900

Total		56,601				-

Under the Company’s equity incentive plans, participants may pay the exercise price or satisfy all or a portion of the federal, state and local withholding tax obligations arising in connection with plan awards by electing to (a) have the Company withhold shares of common stock otherwise issuable under the award, (b) tender back shares received in connection with such award or (c) deliver other previously owned shares of common stock, in each case having a value equal to the exercise price or the amount to be withheld. During the three months ended ~~September 27, 2008,~~March 28, 2009, there were ~~69,359~~56,601 shares acquired in connection with equity incentive plans.

The Board of Directors has approved repurchase programs for up to three million shares of the Company’s common stock. Management is authorized to effect purchases from time to time in the open market or through privately negotiated transactions.

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ITEM 6. EXHIBITS ~~EXHIBITS~~

Exhibit Number		Exhibit Description

12		Computation of Ratio of Earnings to Fixed Charges.

31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certifications of the Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350.

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~~SIGNATURE~~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.

	REGAL BELOIT CORPORATION (Registrant) /s/ David A. Barta
	David A. Barta Vice President and Chief Financial Officer (Principal Accounting and Financial Officer)
Date: May 7, 2009

~~David A. Barta~~

~~Vice President and Chief Financial Officer~~

~~(Principal Accounting and Financial Officer)~~

~~Date: November 5, 2008~~

2122

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I~~INDEX~~ NDEX TO EXHIBITS

Exhibit Number		Exhibit Description

12		Computation of Ratio of Earnings to Fixed Charges.

31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certifications of the Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350

2223

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		Page
PARTPART I - FINANCIAL INFORMATION
Item 1 -	Condensed Consolidated Financial Statements (Unaudited)
	Condensed Consolidated Statements of Earnings	3
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statement of Equity	5
	Condensed Consolidated Statements of Cash Flows	56
	Notes to Condensed Consolidated Financial Statements	67
Item 2 -	Management’s Discussion and Analysis of Financial
	Condition and Results of Operations	1417
Item 3 -	Quantitative and Qualitative Disclosures about Market Risk	1819
Item 4 -	Controls and Procedures	1920

PART II - OTHER INFORMATION

Item 1 -	Legal Proceedings	20
Item 1A -	Risk Factors	2021
Item 2 -	Unregistered Sales of Equity Securities and Use of Proceeds	2021
Item 6 -	Exhibits	21
Signature		22
Index to Exhibits		22
~~Signature~~		21
		23

	Three Months Ending
	March 28, 2009			March 29, 2008
Beginning balance	$	11,022		$	9,872
Deduct: Payments		(2,747	)		(1,736	)
Add: Provision		1,754			1,839
Translation Adjustments		(76	)		(24	)
Ending balance	$	9,953		$	9,951

	Three Months Ending						Nine Months Ending
	September 27, 2008			September 29, 2007			September 27, 2008			September 29, 2007
Beginning balance	$	10,221		$	6,028		$	9,872		$	6,300
Deduct: Payments		(2,343	)		(2,318	)		(5,741	)		(5,772	)
Add: Provision		1,892			2,390			5,666			5,572
Add: Acquisitions		-			2,144			-			2,144
Translation Adjustments		19			-			(8	)		-
Ending balance	$	9,789		$	8,244		$	9,789		$	8,244

	Mechanical Segment												Electrical Segment
	Three Months Ending						Nine Months Ending						Three Months Ending						Nine Months Ending
	Sept. 27, 2008			Sept. 29, 2007			Sept. 27, 2008			Sept. 29, 2007			Sept. 27, 2008			Sept. 29, 2007			Sept. 27, 2008			Sept. 29, 2007
Net Sales	$	56,119		$	53,300		$	168,653		$	164,958		$	564,488		$	396,074		$	1,594,613		$	1,162,857
Income from Operations		7,368			7,911			23,414			24,585			58,366			45,464			167,426			136,176
% of Net Sales		13.1	%		14.8	%		13.9	%		14.9	%		10.3	%		11.5	%		10.5	%		11.7	%
Goodwill at end of period	$	530		$	530		$	530		$	530		$	647,478		$	635,547		$	647,478		$	635,547


	Mechanical Segment						Electrical Segment
	Three Months Ending						Three Months Ending
	March 28, 2009			March 29, 2008			March 28, 2009			March 29, 2008
Net Sales	$	51,912		$	62,550		$	391,362		$	473,793
Income from Operations		6,286			10,047			21,906			47,565
% of Net Sales		12.1	%		16.1	%		5.6	%		10.0	%
Goodwill at end of period	$	530		$	530		$	667,334		$	637,796


	Three Months Ended				Nine Months Ended
	September 27, 2008		September 29, 2007		September 27, 2008		September 29, 2007

Net Sales	$	620,607	$	449,374	$	1,763,266	$	1,327,815

Cost of Sales		487,810		342,660		1,377,193		1,019,998

Gross Profit		132,797		106,714		386,073		307,817

Operating Expenses		67,063		53,339		195,233		147,056

Income From Operations		65,734		53,375		190,840		160,761

Interest Expense		7,103		5,116		21,449		14,607

Interest Income		418		365		1,333		695

Income Before Taxes & Minority Interest		59,049		48,624		170,724		146,849

Provision For Income Taxes		21,261		16,638		60,826		50,301

Income Before Minority Interest		37,788		31,986		109,898		96,548

Minority Interest in Income, Net of Tax		882		747		2,749		2,243

Net Income	$	36,906	$	31,239	$	107,149	$	94,305

Earnings Per Share of Common Stock:

Basic	$	1.18	$	1.00	$	3.42	$	3.02

Assuming Dilution	$	1.09	$	0.92	$	3.20	$	2.78

Cash Dividends Declared	$	0.16	$	0.15	$	0.47	$	0.44

Weighted Average Number of Shares Outstanding:

Basic		31,357,433		31,320,838		31,326,675		31,227,373
Assuming Dilution		33,715,881		34,104,123		33,452,880		33,943,057

	September 27, 2008	December 29, 2007
Raw Material	22%	21%
Work in Process	15%	14%
Finished Goods and Purchased Parts	63%	65%

	Electrical Segment			Mechanical Segment		Total
Balance as of December 27, 2008	$	671,945		$	530	$	672,475
Net Acquisitions and Fair Value Adjustments		(257	)		-		(257	)
Translation Adjustments		(4,354	)		-		(4,354	)
Balance as of March 28, 2009	$	667,334		$	530	$	667,864

			September 27, 2008
Asset Description	Useful Life (years)		Gross Value		Accumulated Amortization		Net Book Value
Non-Compete Agreements		3 -5	$	5,766	$	3,465	$	2,301
Trademarks		3 - 20		19,364		5,440		13,924
Patents		9 - 10.5		15,410		5,805		9,605
Engineering Drawings		10		1,200		457		743
Customer Relationships		10 - 14		87,009		16,649		70,360
Technology		6 - 10		25,829		3,704		22,125
Total			$	154,578	$	35,520	$	119,058

			December 29, 2007
Asset Description	Useful Life (years)		Gross Value		Accumulated Amortization		Net Book Value
Non-Compete Agreements		3 - 5	$	5,588	$	2,540	$	3,048
Trademarks		3 - 20		18,887		4,752		14,135
Patents		9 - 10.5		15,410		4,648		10,762
Engineering Drawings		10		1,200		367		833
Customer Relationships		10 - 14		84,572		10,325		74,247
Technology		6 - 10		27,474		1,026		26,448
Total			$	153,131	$	23,658	$	129,473

Gross Intangibles
Asset Description	Useful Life (years)		December 27, 2008			Net Acquisitions and Fair Value Adjustments			Translation Adjustments			March 28, 2009
Non-Compete Agreements		5	$	5,767		$	575		$	4		$	6,346
Trademarks		3 - 21		19,490			-			19			19,509
Patents		10		15,410			-			-			15,410
Engineering Drawings		10		1,200			-			-			1,200
Customer Relationships		10 - 15		92,633			800			(504	)		92,929
Technology		6 - 11		25,439			1,324			21			26,784
Total Gross Intangibles			$	159,939		$	2,699		$	(460	)	$	162,178

Accumulated Amortization
Asset Description	Useful Life (years)		December 27, 2008			Amortization			Translation Adjustments			March 28, 2009
Non-Compete Agreements		5	$	(3,755	)	$	(318	)	$	(2	)	$	(4,075	)
Trademarks		3 - 21		(6,026	)		(298	)		(2	)		(6,326	)
Patents		10		(6,190	)		(385	)		-			(6,575	)
Engineering Drawings		10		(487	)		(30	)		-			(517	)
Customer Relationships		10 - 15		(18,625	)		(2,388	)		69			(20,944	)
Technology		6 - 11		(4,072	)		(811	)		(7	)		(4,890	)
Total Accumulated Amortization			$	(39,155	)	$	(4,230	)	$	58		$	(43,327	)

Intangible Assets, Net of Amortization			$	120,784								$	118,851

	September 27, 2008			December 29, 2007
Senior notes	$	250,000		$	250,000
Term loan		165,000			-
Revolving credit facility		13,000			182,700
Convertible senior subordinated debt		115,000			115,000
Other		28,246			16,550
		571,246			564,250
Less: Current maturities		(17,159	)		(5,332	)
Non-current portion	$	554,087		$	558,918

	Shares		Wtd. Avg. Exercise Price		Wtd. Avg. Remaining Contractual Term (years)		Aggregate Intrinsic Value (in millions)
Number of shares:
Outstanding		1,569,745	$	32.96		6.9	$	17.4
Exercisable		662,542	$	27.74		5.8	$	10.5

2008 Fiscal Month	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares that May Be Purchased Under the Plan or Programs
June 29, 2008 to August 2, 2008		-	$	-		-		2,115,900

August 3, 2008 to August 30, 2008		69,359	$	48.55		-		2,115,900

August 31, 2008 to September 27, 2008		-	$	-		-		2,115,900

Total		69,359				-