UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 24, 2005

BARNES GROUP INC.
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of incorporation)

1-04801	 	06-0247840	
(Commission File Number)	 	(I.R.S. Employer Identification No.)	
 	 	
123 Main Street, Bristol, Connecticut	 	06011-0489	
(Address of principal executive offices)	 	(Zip Code)	

(860) 583-7070
Registrant's telephone number, including area code

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:	

[ ]	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	
[ ]	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	
[ ]	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))	
[ ]	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))	

-1-  	

Item 2.02	 	Results of Operations and Financial Condition.
 
On October 24, 2005, Barnes Group Inc. issued a press release announcing the financial results of operations for the third quarter ended September 30, 2005. A copy is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
 
The information in this Current Report on 8-K and the exhibit attached hereto shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Exchange Act or Securities Act of 1933, as amended, except as expressly set forth by specific reference in such filing.
 	
Item 9.01	 	Financial Statements and Exhibits.
 
Exhibit 99.1: Press Release issued October 24, 2005, announcing the financial results of operations for the third quarter ended September 30, 2005.	

SIGNATURES
 
        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 hereunto duly authorized.	

Dated:  October 24, 2005	BARNES GROUP INC.	
 	(Registrant)	
 	 	
 	By: /s/    WILLIAM C. DENNINGER	
 	 	 	 	 	 	
 	     William C. Denninger
     Senior Vice President and
     Chief Financial Officer	

 
EXHIBIT INDEX

 
 
Exhibit No.	 	Document Description     	
 	 	 	
99.1	 	Press Release, dated October 24, 2005	

-2-	

 
 
  Barnes Group Inc.	 	
  Corporate Office	 	
  Bristol, CT 06010	 	
  Tel: (860) 583-7070	 	

  	  	
 	 	Brian D. Koppy	
 	 	Investor Relations	
 	 	(860) 973-2126	
 	 	 	
 	 	Stephen J. McKelvey	
 	 	Corporate Communications	
 	 	(860) 973-2132	

BARNES GROUP INC. ANNOUNCES RECORD
THIRD QUARTER FINANCIAL RESULTS

-  	11 th consecutive quarter of double-digit sales growth	
-  	Third quarter net income $0.70 per diluted share; $0.55 per diluted share from current
period operations, a 38 percent increase over the prior-year quarter	
-  	Full-year 2005 estimated adjusted net income per diluted share raised to $2.15 - $2.20	

Bristol, Connecticut, October 24, 2005--- Barnes Group Inc. (NYSE:B) today announced financial results for the quarter ended September 30, 2005. Net sales for the third quarter 2005 were $271.5 million, up 11 percent from $243.9 million in the third quarter 2004. Net income increased 81 percent to $17.4 million, or $0.70 per diluted share, in the third quarter of 2005 from $9.6 million, or $0.40 per diluted share, in the third quarter of 2004. Net income from operations, excluding retroactive tax benefits and a positive out-of-period adjustment related to accounts payable, would have been $13.7 million, or $0.55 per diluted share 1 , a 42 percent increase from $9.6 million, or $0.40 per diluted share, in the comparable year-ago quarter.

Included in Barnes Group’s third quarter results were retroactive tax benefits of multi-year Pioneer Status granted by the Singapore Ministry of Trade and Industry, for the production of aircraft engine components for original equipment manufacturers (OEMs) and the spare parts market. The tax benefits include approximately $1.1 million, or $0.04 per diluted share for the first half of 2005, and approximately $1.5 million, or $0.06 per diluted share, for the periods prior to January 1, 2005, for a total retroactive tax benefit of approximately $2.6 million or $0.10 per diluted share. A second item is an out-of-period $1.8 million favorable pre-tax adjustment related to accounts payable. The related after-tax impact is approximately $1.1 million, or $0.05 per diluted share. 1  

Operating income grew 47 percent to $22.6 million for the third quarter 2005 from $15.4 million in the third quarter of the prior year. Operating income, excluding the positive adjustment related to accounts payable, was $20.8 million 1 , a 36 percent increase, from $15.4 million in the third quarter 2004.

(1)   Please reference the Non-GAAP Financial Measure Reconciliation at the end of this press release.

 
 
 Barnes Group Inc. / 2	

“This marks the 11 th consecutive quarter in which Barnes Group has posted double-digit sales growth over the comparable prior year quarter,” said Edmund M. Carpenter, President and Chief Executive Officer, Barnes Group Inc. “We had a strong third quarter with solid growth in all three business segments, as the organization continues to focus on reducing operational costs and improving after-tax operating results.”

“Considering the strong first three quarters and current market conditions, we are increasing our full-year 2005 estimate of diluted earnings per share to $2.15 - $2.20. This excludes the benefits from the gain on the sale of NASCO in the second quarter, retroactive Pioneer Status tax benefits and the positive adjustment related to accounts payable,” Carpenter continued.

Sales at Barnes Distribution were a record $114.0 million for the quarter ended September 30, 2005, up 7 percent, or $7.0 million, from $107.0 million in the quarter ended September 30, 2004, including $2.1 million from the Toolcom acquisition, which was announced in August 2005. Sales from Corporate Accounts and Tier II were up 10 percent and 39 percent, respectively, for the third quarter of 2005, compared to the third quarter of 2004.

Barnes Distribution reported operating profit of $8.6 million. Excluding the accounts payable adjustment, operating profit would have been $6.8 million 1 , up 17% in the third quarter, compared with $5.8 million in the year-ago quarter. The increase in operating profit was primarily driven by higher sales volume and the beneficial effects of the distribution network’s increased operational effectiveness.

“Barnes Distribution continues to realize benefits from its strategic sales focus and distribution network investments,” said A. Keith Drewett, President, Barnes Distribution. “As the operational improvements and global sourcing capabilities accelerate, we expect to improve profitability and expand the range of products and services we offer our customers.”

Sales at Associated Spring were $100.2 million for the third quarter of 2005, up 14 percent from $88.3 million in the third quarter of 2004. Specialty operations including Nitrogen Gas Products and Seeger-Orbis Retaining Rings continued strong sales growth. Barnes Precision Valve contributed an incremental $6.1 million to Associated Spring’s sales in the third quarter of 2005.

Associated Spring’s operating profit increased 55 percent to $6.6 million in the quarter ended September 30, 2005, compared with $4.3 million in the comparable quarter last year. Driving this improvement was the increase in profit contribution from specialty operations, partially offset by higher than anticipated domestic operating costs.
 
“In the third quarter, Associated Spring’s specialty operations continued to generate strong top and bottom line growth,” said Gregory F. Milzcik, President, Associated Spring. “We continue to be focused on profitable sales, and improvements to the operational effectiveness of our domestic legacy spring business.”

Sales at Barnes Aerospace were a record $59.3 million for the quarter ended September 30, 2005, up 15 percent from $51.7 million in the quarter ended September 30, 2004. Sales were up in the OEM and aftermarket segments 9 percent and 36 percent, respectively, in the third quarter 2005, compared to the third quarter 2004. Orders were down slightly to $69.8 million in the third quarter from $73.1

(1)   Please reference the Non-GAAP Financial Measure Reconciliation at the end of this press release.

 
 
 Barnes Group Inc. / 3	

million in the prior-year quarter. Backlog increased 46 percent to $255.7 million at September 30, 2005, compared to $174.9 million in the year-ago quarter.

Operating profit at Barnes Aerospace grew 36 percent to $7.4 million in the third quarter, from $5.5 million in the third quarter of 2004. The increase in operating profit was driven by higher sales volume and an increased percentage of higher margin aftermarket activity.

“Barnes Aerospace continued its strong results with record sales, operating profit and backlog in the third quarter of 2005,” said Patrick Dempsey, President, Barnes Aerospace. “This was a balanced quarter with growth in both the OEM and aftermarket businesses. Focusing on leveraging our products and technologies, Barnes Aerospace continues to provide positive financial results.”

William C. Denninger, Barnes Group Inc.’s Chief Financial Officer, commented, “We continued to strengthen our balance sheet during the third quarter 2005 with a successful $100 million, 3.75 percent convertible senior subordinated debt offering. And, our debt to capitalization ratio at quarter-end of 42 percent was at the low end of our targeted range, even after using $36.0 million in cash for the Toolcom and Service Plus Distributions (SPD) acquisitions and for aerospace aftermarket RSP payments during the quarter.”

For the nine months ended September 30, 2005, Barnes Group net sales were $825.8 million, up 11 percent from $743.1 million in the comparable period in 2004. Net income increased 60 percent to $48.9 million, or $2.02 per diluted share, for the nine months ended September 30, 2005, from $30.5 million, or $1.28 per diluted share, in the year-ago period. Net income, excluding the gain on the sale of NASCO, retroactive tax benefits and the positive out-of-period adjustment related to accounts payable, was $42.2 million, or $1.74 per diluted share 1 , a 38 percent increase from $30.5 million, or $1.28 per diluted share in the comparable year-ago period.

Barnes Group will conduct a conference call with investors to discuss third quarter results at 9:30 a.m. EDT today. A web cast of the live call, supporting materials and an archived replay will be available on the Barnes Group investor relations link at www.barnesgroupinc.com.

Barnes Group Inc. ( www.barnesgroupinc.com ) is a diversified international manufacturer of precision metal components and assemblies and a distributor of industrial supplies, serving a wide range of markets and customers. Founded in 1857 and headquartered in Bristol, Connecticut, Barnes Group consists of three businesses with 2004 sales of $994.7 million: Barnes Distribution, an international, full-service distributor of maintenance, repair, operating, and production supplies; Associated Spring, one of the world's largest manufacturers of precision mechanical and nitrogen gas springs and a global supplier of retaining rings, reed valves, shock discs, and injection-molded plastic components; and Barnes Aerospace, a manufacturer and repairer of highly engineered assemblies and components for commercial and military aircraft engines, airframes, and land-based industrial gas turbines. Over 5,900 dedicated employees at more than 60 locations worldwide contribute to Barnes Group Inc.’s success.

This release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those expressed in the forward-looking statements. The risks and uncertainties, which are described in our periodic filings with the

(1)   Please reference the Non-GAAP Financial Measure Reconciliation at the end of this press release.

 
 Barnes Group Inc. / 4	

Securities and Exchange Commission, include, among others, uncertainties arising from the behavior of financial markets; future financial performance of the industries or customers that we serve; changes in market demand for our products and services; integration of acquired businesses; changes in raw material prices and availability; uninsured claims; and numerous other matters of global, regional or national scale, including those of a political, economic, business, competitive, regulatory and public health nature. We assume no obligation to update our forward-looking statements.

# # #

 
  Barnes Group Inc. / 5             	
 	
BARNES GROUP INC.	
CONSOLIDATED STATEMENTS OF INCOME	
(Dollars in thousands, except per share data)	
Unaudited	

 
 	 	   Three months ended September 30,	 	 	 	 	   Nine months ended September 30,	 	
 	 	 	2005	 	 	2004	 		% Change	 	 	 	 	2005	 	 	2004	 	 	% Change	 	
 	 	 	As restated, note 1	 	 	 	 	  As restated, note 1	 	
Net sales	 	$	271,518	 	$	243,928	 	 	11.3	 	 	 	 	$	825,768	 	$	743,107	 	 	11.1	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cost of sales (see note 2)	 	 	172,070	 	 	159,379	 	 	8.0	 	 	 	 	 	526,572	 	 	485,718	 	 	8.4	 	
Selling and administrative expenses	 	 	76,824	 	 	69,187	 	 	11.0	 	 	 	 	 	231,618	 	 	208,504	 	 	11.1	 	
 	 	 	248,894	 	 	228,566	 	 	8.9	 	 	 	 	 	758,190	 	 	694,222	 	 	9.2	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income	 	 	22,624	 	 	15,362	 	 	47.3	 	 	 	 	 	67,578	 	 	48,885	 	 	38.2	 	
Operating margin	 	 	8.3	%	 	6.3	%	 	 	 	 	 	 	 	8.2	%	 	6.6	%	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other income (see note 3)	 	 	532	 	 	313	 	 	69.9	 	 	 	 	 	10,064	 	 	1,719	 	 	NM	 	
Interest expense	 	 	4,387	 	 	3,757	 	 	16.8	 	 	 	 	 	12,892	 	 	11,263	 	 	14.5	 	
Other expenses	 	 	174	 	 	363	 	 	(52.0	)	 	 	 	 	716	 	 	621	 	 	15.3	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income before income taxes	 	 	18,595	 	 	11,555	 	 	60.9	 	 	 	 	 	64,034	 	 	38,720	 	 	65.4	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income taxes (see note 4)	 	 	1,241	 	 	1,965	 	 	(36.9	)	 	 	 	 	15,165	 	 	8,216	 	 	84.6	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	 	$	17,354	 	$	9,590	 	 	81.0	 	 	 	 	$	48,869	 	$	30,504	 	 	60.2	 	

Per common share:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Net income - basic	 	$	0.73	 	$	0.41	 	 	78.0	 	 	 	 	$	2.08	 	$	1.32	 	 	57.6	 	
  Net income - diluted	 	 	0.70	 	 	0.40	 	 	75.0	 	 	 	 	 	2.02	 	 	1.28	 	 	57.8	 	
  Dividends	 	 	0.22	 	 	0.20	 	 	10.0	 	 	 	 	 	0.62	 	 	0.60	 	 	3.3	 	

Average common shares	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
outstanding - basic	 	 	23,697,410	 	 	23,139,339	 	 	2.4	 	 	 	 	 	23,497,229	 	 	23,080,477	 	 	1.8	 	
                  - diluted	 	 	24,660,478	 	 	23,779,636	 	 	3.7	 	 	 	 	 	24,248,899	 	 	23,842,586	 	 	1.7	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NM - Not meaningful	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Notes:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
1) Restated to reflect the retroactive adjustment of changing the method of valuing certain U.S. inventories from LIFO to FIFO.	
2) Third quarter 2005 cost of sales includes a $1,814 ($1,141 after tax, or $0.05 diluted EPS) positive adjustment related to accounts payable. Refer to page 8, Note 1).	
3) Year to date 2005 other income includes the $8,892 gain ($4,030 after tax, or $0.17 diluted EPS) on the sale of the NASCO investment in April.	
4) Third quarter 2005 taxes include a $2,553 benefit ($0.10 diluted EPS) of which $1,473 ($0.06 diluted EPS) relates to prior years, related to being granted Pioneer tax status in  Singapore.	

 
   Barnes Group Inc. / 6	 	
 	 	
  BARNES GROUP INC.	 	
  OPERATIONS BY REPORTABLE BUSINESS SEGMENT	 	
  (Dollars in thousands)	 	
  Unaudited	 	

 	 	Three Months Ended September 30,	 	Nine Months Ended September 30,	 	
 	 	2005	 	2004	 	% Change	 	2005	 	2004	 	% Change	 	
 	 	  As restated, note1	 	  As restated, note1	 	
Net sales	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Barnes Distribution	 	$	113,959	 	$	106,960	 	 	6.5	 	$	340,906	 	$	320,597	 	 	6.3	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Associated Spring	 	 	100,249	 	 	88,265	 	 	13.6	 	 	321,283	 	 	276,426	 	 	16.2	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Barnes Aerospace	 	 	59,301	 	 	51,724	 	 	14.6	 	 	171,237	 	 	154,480	 	 	10.8	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Intersegment sales	 	 	(1,991	)	 	(3,021	)	 	34.1	 	 	(7,658	)	 	(8,396	)	 	8.8	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total net sales	 	$	271,518	 	$	243,928	 	 	11.3	 	$	825,768	 	$	743,107	 	 	11.1	 	

Operating profits	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Barnes Distribution (note 2)	 	$	8,588	 	$	5,798	 	 	48.1	 	$	21,081	 	$	14,739	 	 	43.0	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Associated Spring	 	 	6,634	 	 	4,274	 	 	55.2	 	 	26,631	 	 	19,965	 	 	33.4	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Barnes Aerospace	 	 	7,449	 	 	5,464	 	 	36.3	 	 	20,073	 	 	15,067	 	 	33.2	 	

Total operating profit	 	 	22,671	 	 	15,536	 	 	45.9	 	 	67,785	 	 	49,771	 	 	36.2	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Interest income	 	 	469	 	 	264	 	 	77.7	 	 	903	 	 	816	 	 	10.7	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Interest expense	 	 	(4,387	)	 	(3,757	)	 	16.8	 	 	(12,892	)	 	(11,263	)	 	14.5	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
  Other income (expense) (note 3)	 	 	(158	)	 	(488	)	 	67.6	 	 	8,238	 	 	(604	)	 	NM	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income before income taxes	 	$	18,595	 	$	11,555	 	 	60.9	 	$	64,034	 	$	38,720	 	 	65.4	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NM - Not meaningful	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Notes:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
1) Restated to reflect the retroactive adjustment of changing the method of valuing certain U.S. inventories from LIFO to FIFO.	
2) Third Quarter 2005 includes a $1,814 positive adjustment related to accounts payable. Refer to page 8, Note (1).	
3) Year to date 2005 other income includes the $8,892 gain on the sale of NASCO investment in April.	

 
Barnes Group Inc. / 7	 	
 	 	
  BARNES GROUP INC.	 	
  CONSOLIDATED BALANCE SHEETS	 	
  (Dollars in thousands)	 	
  Unaudited	 	

 	 	  September 30,	 	  September 30,	 	
Assets	 	 	2005	 	 	2004	 	
Current assets	 	 	 	 	  As restated, note 1	 	
  Cash and cash equivalents	 	$	31,489	 	$	33,696	 	
  Accounts receivable	 	 	163,281	 	 	146,880	 	
  Inventories	 	 	158,465	 	 	135,565	 	
  Deferred income taxes and prepaid expenses	 	 	35,662	 	 	35,794	 	
 	 	 	 	 	 	 	 	
    Total current assets	 	 	388,897	 	 	351,935	 	
 	 	 	 	 	 	 	 	
Deferred income taxes	 	 	14,670	 	 	16,162	 	
Property, plant and equipment	 	 	157,276	 	 	159,714	 	
Goodwill	 	 	234,084	 	 	225,497	 	
Other intangible assets, net	 	 	165,894	 	 	103,830	 	
Other assets	 	 	48,075	 	 	59,310	 	
 	 	 	 	 	 	 	 	
Total assets	 	$	1,008,896	 	$	916,448	 	
 	 	 	 	 	 	 	 	
Liabilities and Stockholders' Equity	 	 	 	 	 	 	 	
Current liabilities	 	 	 	 	 	 	 	
  Notes payable	 	$	-	 	$	3,500	 	
  Accounts payable	 	 	141,746	 	 	114,383	 	
  Accrued liabilities	 	 	80,316	 	 	75,185	 	
  Long-term debt - current	 	 	21,614	 	 	7,626	 	
 	 	 	 	 	 	 	 	
    Total current liabilities	 	 	243,676	 	 	200,694	 	
 	 	 	 	 	 	 	 	
Long-term debt	 	 	266,382	 	 	270,361	 	
Accrued retirement benefits	 	 	84,589	 	 	78,657	 	
Other liabilities	 	 	18,387	 	 	15,212	 	
 	 	 	 	 	 	 	 	
Stockholders' equity	 	 	395,862	 	 	351,524	 	
 	 	 	 	 	 	 	 	
Total liabilities and stockholders' equity	 	$	1,008,896	 	$	916,448	 	

Footnote:	 	 	 	 	 	 	 	
1) Restated to reflect the retroactive adjustment of changing the method of valuing certain U.S. inventories from LIFO to FIFO.	

 
Barnes Group Inc. / 8	 	
 	 	
BARNES GROUP INC.	 	
NON-GAAP FINANCIAL MEASURE RECONCILIATION	 	
(Dollars in thousands, except per share data)	 	
Unaudited	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Following is a reconciliation of results excluding certain adjustments to the Company's reported results:	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Three months ended September 30,	 	Nine months ended September 30,	 	
 	 	2005	 	 
2004	 	%
Change	 	 
2005	 	 
2004	 	%
Change	 	
 	 	  As Restated	 	  As Restated	 	
Segment results:	 	 	 	 	 	 	 	 	 	 	 	 	 	
Barnes Distribution	 	 	 	 	 	 	 	 	 	 	 	 	 	
   Operating profit, as reported	 	$	8,588	 	$	5,798	 	 	48.1	 	$	21,081	 	$	14,739	 	 	43.0	 	
   Accounts payable adjustment (see note 1)	 	 	(1,814	)	 	-	 	 	NM	 	 	(1,814	)	 	-	 	 	NM	 	
   Operating profit, excluding adjustment	 	$	6,774	 	$	5,798	 	 	16.8	 	$	19,267	 	$	14,739	 	 	30.7	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Consolidated Results	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Barnes Group Inc.	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
   Cost of sales, as reported	 	$	172,070	 	$	159,379	 	 	8.0	 	$	526,572	 	$	485,718	 	 	8.4	 	
   Accounts payable adjustment (see note 1)	 	 	1,814	 	 	-	 	 	NM	 	 	1,814	 	 	-	 	 	NM	 	
   Cost of sales, excluding adjustment	 	$	173,884	 	$	159,379	 	 	9.1	 	$	528,386	 	$	485,718	 	 	8.8	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
   Operating income, as reported	 	$	22,624	 	$	15,362	 	 	47.3	 	$	67,578	 	$	48,885	 	 	38.2	 	
   Accounts payable adjustment (see note 1)	 	 	(1,814	)	 	-	 	 	NM	 	 	(1,814	)	 	-	 	 	NM	 	
   Operating income, excluding adjustment	 	$	20,810	 	$	15,362	 	 	35.5	 	$	65,764	 	$	48,885	 	 	34.5	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
   Income taxes, as reported	 	$	1,241	 	$	1,965	 	 	(36.9	)	$	15,165	 	$	8,216	 	 	84.6	 	
   Accounts payable adjustment (see note 1)	 	 	(673	)	 	-	 	 	NM	 	 	(673	)	 	-	 	 	NM	 	
   Singapore tax benefit (see note 2)	 	 	2,553	 	 	-	 	 	NM	 	 	1,473	 	 	-	 	 	NM	 	
   Gain on sale of NASCO (see note 3)	 	 	-	 	 	-	 	 	NM	 	 	(4,862	)	 	-	 	 	NM	 	
   Income taxes, excluding adjustments	 	$	3,121	 	$	1,965	 	 	58.8	 	$	11,103	 	$	8,216	 	 	35.1	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
   Net income, as reported	 	$	17,354	 	$	9,590	 	 	81.0	 	$	48,869	 	$	30,504	 	 	60.2	 	
   Accounts payable adjustment (see note 1)	 	 	(1,141	)	 	-	 	 	NM	 	 	(1,141	)	 	-	 	 	NM	 	
   Singapore tax benefit (see note 2)	 	 	(2,553	)	 	-	 	 	NM	 	 	(1,473	)	 	-	 	 	NM	 	
   Gain on sale of NASCO (see note 3)	 	 	-	 	 	-	 	 	NM	 	 	(4,030	)	 	-	 	 	NM	 	
   Net income, excluding adjustments	 	$	13,660	 	$	9,590	 	 	42.4	 	$	42,225	 	$	30,504	 	 	38.4	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
   Net income per common share -
    diluted, as reported	 	$	0.70	 	$	0.40	 	 	75.0	 	$	2.02	 	$	1.28	 	 	57.8	 	
   Accounts payable adjustment (see note 1)	 	 	(0.05	)	 	-	 	 	NM	 	 	(0.05	)	 	-	 	 	NM	 	
   Singapore tax benefit (see note 2)	 	 	(0.10	)	 	-	 	 	NM	 	 	(0.06	)	 	-	 	 	NM	 	
   Gain on sale of NASCO (see note 3)	 	 	-	 	 	-	 	 	NM	 	 	(0.17	)	 	-	 	 	NM	 	
   Net income per common share -
    diluted, excluding adjustments	 	$	0.55	 	$	0.40	 	 	37.5	 	$	1.74	 	$	1.28	 	 	35.9	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
NM - not meaningful	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Notes: The Company has presented certain financial measurements, excluding certain retroactive tax benefits, a positive adjustment related to accounts payable and the gain on the sale of NASCO as follows:	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
1) As part of management's on-going internal control assessment, during the third quarter of 2005, the Company identified and recorded an adjustment to accounts payable and cost of sales at Barnes Distribution. The Company determined that cost of sales was overstated in prior periods due to inaccuracies in recording inventory receipts from 2000 through 2005. This overstatement was corrected in the third quarter of 2005 as a reduction to cost of sales of $1,814. The after-tax effect of this adjustment was $1,141. Management concluded that such corrections were immaterial, both quantitatively and qualitatively, to the 2005 financial statements and to the previously reported results of the prior years to which they relate.	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
2) During the third quarter of 2005, the Company was granted Pioneer tax status in Singapore and recorded retroactive tax benefits of $2,553 of which $1,473 related to periods prior to January 1, 2005 and $1,080 related to the first half of 2005.	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
3) During the second quarter of 2005, the Company sold its 45 percent interest in NHK-Associated Spring Suspension Components Inc. ("NASCO"), resulting in a pre-tax gain of $8,892 and an after-tax gain of $4,030.	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
These adjustments represent out-of-period or discrete items and management believes that providing results excluding these items is useful to investors. Management does not intend results excluding the adjustments to represent results as defined by GAAP, and the reader should not consider it as an alternative measurement calculated in accordance with GAAP, or as an indicator of the Company's operating performance. Accordingly, the measurements have limitations depending on their use.