UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2001

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the transition period from ____________________ to ____________________

Commission File No. 1-9389

C&D TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its charter)

Delaware 13-3314599
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

1400 Union Meeting Road
Blue Bell, Pennsylvania 19422
(Address of principal executive office)
(Zip Code)

(215) 619-2700
(Registrant's telephone number, including area code)

_____________________________________
(Former name, former address and former fiscal year, if changed since last
report)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

YES X NO_____

Number of shares of the Registrant's Common Stock outstanding on December 6,
2001: 26,095,751

C&D TECHNOLOGIES, INC.
AND SUBSIDIARIES

INDEX

PART I. FINANCIAL INFORMATION Page No.

Item 1 - Financial Statements

Consolidated Balance Sheets -
October 31, 2001 and January 31, 2001................. 3

Consolidated Statements of Income - Three and
Nine Months Ended October 31, 2001 and 2000........... 5

Consolidated Statements of Cash Flows -
Nine Months Ended October 31, 2001 and 2000........... 6

Consolidated Statements of Comprehensive Income -
Three and Nine Months Ended October 31, 2001 and 2000 8

Notes to Consolidated Financial Statements............. 9

Report of Independent Accountants...................... 18

Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations...... 19

PART II. OTHER INFORMATION.................................... 24

SIGNATURES.................................................... 25

PART I. FINANCIAL INFORMATION

Item 1 - Financial Statements

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share data)

(Unaudited)
October 31, January 31,
2001 2001
---- ----
ASSETS

Current assets:
Cash and cash equivalents................... $ 5,501 $ 7,709
Accounts receivable, less allowance for
doubtful accounts of $2,937 and $4,121,
respectively........................... 61,030 88,596
Inventories................................. 67,093 77,493
Deferred income taxes....................... 12,331 10,990
Other current assets........................ 4,156 1,459
------- -------
Total current assets............. 150,111 186,247

Property, plant and equipment, net................ 131,769 130,387
Intangible and other assets, net.................. 21,880 23,309
Goodwill, net..................................... 110,549 115,576
------- -------
Total assets..................... $414,309 $455,519
======= =======

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Short-term debt............................. $ 12,503 $ 18,172
Accounts payable............................ 21,090 45,935
Accrued liabilities......................... 29,594 34,918
Income taxes................................ - 2,533
Other current liabilities................... 7,697 8,794
------- -------
Total current liabilities........ 70,884 110,352

Deferred income taxes ............................ 2,063 1,135
Long-term debt.................................... 73,365 98,849
Other liabilities................................. 17,718 20,133
------- -------
Total liabilities................ 164,030 230,469
------- -------

The accompanying notes are an integral part of these statements.

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (continued)
(Dollars in thousands, except per share data)

(Unaudited)
October 31, January 31,
2001 2001
---- ----
Commitments and contingencies

Minority interest................................. 8,077 6,996

Stockholders' equity:
Common stock, $.01 par value, 75,000,000
shares authorized; 28,396,761 and
28,276,917 shares issued, respectively.. 284 283
Additional paid-in capital.................. 65,304 62,908
Treasury stock, at cost, 2,209,821 and
1,986,038 shares, respectively.......... (25,295) (17,750)
Accumulated other comprehensive loss........ (2,651) (1,231)
Retained earnings........................... 204,560 173,844
------- -------
Total stockholders' equity....... 242,202 218,054
------- -------
Total liabilities and
stockholders' equity........... $414,309 $455,519
======= =======

The accompanying notes are an integral part of these statements.

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)

(Unaudited) (Unaudited)
Three months ended Nine months ended
October 31, October 31,
2001 2000 2001 2000
---- ---- ---- ----

Net sales*........................... $102,505 $161,922 $383,381 $452,089
Cost of sales*....................... 80,395 116,511 277,729 324,428
------- ------- ------- -------
Gross profit..................... 22,110 45,411 105,652 127,661

Selling, general and
administrative expenses.......... 13,965 16,353 39,390 49,605
Research and development
expenses......................... 2,461 2,514 7,895 7,522
------- ------- ------- -------
Operating income................. 5,684 26,544 58,367 70,534

Interest expense, net................ 1,593 1,215 5,351 4,679
Other expense (income), net.......... 706 (29) 832 121
------- ------- ------- -------
Income before income taxes and
minority interest............. 3,385 25,358 52,184 65,734

Provision for income taxes........... 1,252 9,746 19,308 24,847
------- ------- ------- -------
Net income before minority
interest...................... 2,133 15,612 32,876 40,887

Minority interest.................... 285 867 1,081 1,698
------- ------- ------- -------
Net income....................... $ 1,848 $ 14,745 $ 31,795 $ 39,189
======= ======= ======= =======

Net income per share - basic......... $ .07 $ .56 $ 1.22 $ 1.50
======= ======= ======= =======

Net income per share - diluted....... $ .07 $ .54 $ 1.19 $ 1.44
======= ======= ======= =======

Dividends per share.................. $ .01375 $ .01375 $ .04125 $ .04125
======= ======= ======= =======

* Reclassified for comparative purposes.

The accompanying notes are an integral part of these statements.

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
Nine months ended
October 31,
2001 2000
---- ----
Cash flows provided (used) by operating activities:
Net income...................................... $ 31,795 $ 39,189
Adjustments to reconcile net income to net
cash provided by operating activities:
Minority interest......................... 1,081 1,698
Depreciation and amortization............. 23,192 19,488
Deferred income taxes..................... (413) (276)
Loss on disposal of assets................ 219 593
Changes in:
Accounts receivable................. 27,153 (14,103)
Inventories......................... 10,159 (8,142)
Other current assets................ (471) 263
Accounts payable.................... (20,355) (352)
Accrued liabilities................. (4,739) 9,576
Income taxes payable................ (4,125) 1,557
Other current liabilities........... (1,098) 641
Other liabilities................... (2,415) (434)
Other, net................................ (464) 1,054
------- -------
Net cash provided by operating activities........... 59,519 50,752
------- -------
Cash flows provided (used) by investing activities:
Acquisition of property, plant and equipment.... (22,473) (29,406)
Proceeds from disposal of property, plant
and equipment................................ 38 154
------- -------
Net cash used by investing activities............... (22,435) (29,252)
------- -------
Cash flows provided (used) by financing activities:
Repayment of debt............................... (43,632) (22,364)
Proceeds from new borrowings.................... 11,786 1,200
Financing costs of long-tem debt................ - (244)
Proceeds from issuance of common stock, net..... 1,439 3,935
Purchase of treasury stock...................... (7,427) (3,790)
Payment of common stock dividends............... (1,441) (1,443)
------- -------

The accompanying notes are an integral part of these statements.

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
(Dollars in thousands)

(Unaudited)
Nine months ended
October 31,
2001 2000
---- ----

Net cash used by financing activities............. (39,275) (22,706)
------- -------
Effect of exchange rate changes on cash........... (17) (219)
------- -------
Decrease in cash and cash equivalents............. (2,208) (1,425)

Cash and cash equivalents at beginning
of period...................................... 7,709 7,121
------- -------
Cash and cash equivalents at end of period........ $ 5,501 $ 5,696
======= =======

SCHEDULE OF NON CASH INVESTING
AND FINANCIAL ACTIVITIES

Decrease in property, plant, and
equipment acquisitions in
accounts payable............................... $ (4,435) $ -
======= =======

The accompanying notes are an integral part of these statements.

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Dollars in thousands)

(Unaudited) (Unaudited)
Three months ended Nine months ended
October 31, October 31,
2001 2000 2001 2000
---- ---- ---- ----

Net income........................................ $ 1,848 $14,745 $31,795 $39,189

Other comprehensive (expense) income, net of tax:

Cumulative effect of accounting change.......... - - (103) -

Net unrealized loss on derivative instruments... (1,016) - (1,491) -

Foreign currency translation adjustments........ 947 (562) 174 (1,205)
------ ------ ------ ------
Total comprehensive income........................ $ 1,779 $14,183 $30,375 $37,984
====== ====== ====== ======

The accompanying notes are an integral part of these statements.

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
(UNAUDITED)

1. INTERIM STATEMENTS

The accompanying interim consolidated financial statements of C&D
Technologies, Inc. (together with its operating subsidiaries, the "Company")
should be read in conjunction with the consolidated financial statements and
notes thereto contained in the Company's Annual Report to Stockholders for the
fiscal year ended January 31, 2001. The January 31, 2001 amounts were derived
from the Company's audited financial statements. The consolidated financial
statements presented herein are unaudited but, in the opinion of management,
include all necessary adjustments (which comprise only normal recurring items)
required for a fair presentation of the consolidated financial position as of
October 31, 2001 and the related consolidated statements of income and
comprehensive income for the three and nine month periods ended October 31, 2001
and 2000 and the related consolidated statements of cash flow for the nine month
periods ended October 31, 2001 and 2000. However, interim results of operations
may not be indicative of results for the full fiscal year.

2. RECLASSIFICATIONS

The Company adopted Emerging Issues Task Force Issue 00-10, "Accounting for
Shipping and Handling Revenue and Costs," which requires amounts charged to
customers for shipping and handling be classified as revenue. The associated
shipping costs, previously classified as an offset against revenue, are now
classified as cost of goods sold. The consolidated financial statements for the
three and nine month periods ended October 31, 2000 have been adjusted to
conform to the fiscal 2002 presentation.

3. INVENTORIES

Inventories consisted of the following:
October 31, January 31,
2001 2001
---- ----

Raw materials............................ $27,014 $38,349
Work-in-progress......................... 14,440 18,703
Finished goods........................... 25,639 20,441
------ ------
$67,093 $77,493
====== ======

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except per share data)
(UNAUDITED)

4. INCOME TAXES

A reconciliation of the provision for income taxes from the statutory rate
to the effective rate is as follows:
Nine months ended
October 31,
2001 2000
---- ----

U.S. statutory income tax....................... 35.0% 35.0%
State tax, net of federal income tax benefit.... 2.4 3.3
Foreign sales corporation....................... (0.3) (0.3)
Tax effect of foreign operations................ 0.4 -
Research and development credit................. (0.1) (0.4)
Other........................................... (0.4) 0.2
---- ----
37.0% 37.8%
==== ====

5. NET INCOME PER COMMON SHARE

Net income per share - basic for the three and nine months ended October
31, 2001 and 2000 is based on the weighted average number of shares of Common
Stock outstanding. Net income per share - diluted reflects the potential
dilution that could occur if stock options were exercised. Weighted average
common shares and common shares - assuming dilution were as follows:

Three months ended Nine months ended
October 31, October 31,
2001 2000 2001 2000
---- ---- ---- ----
Weighted average shares
of common stock
outstanding............. 26,178,156 26,227,774 26,166,802 26,199,028
Assumed exercise of stock
options, net of shares
assumed reacquired...... 323,749 1,196,027 604,906 1,040,937
---------- ---------- ---------- ----------
Weighted average common
shares - assuming
dilution................ 26,501,905 27,423,801 26,771,708 27,239,965
========== ========== ========== ==========

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except per share data)
(UNAUDITED)

6. CONTINGENT LIABILITIES

With regard to the following contingent liabilities, there have been no
material changes since January 31, 2001.

Legal:

In January 2000, the Company was sued in an action captioned Puerto Rico
Electric Power Authority v. C&D Technologies, Inc., Case No. 00-1104 in the
United States District Court for the District of Puerto Rico for an alleged
breach of contract in connection with the sale of certain batteries dating back
to the mid-1990s. In August 2000 the Company entered into a settlement agreement
with respect to this claim, the cost of which was recovered from our insurance
carriers in the first quarter of fiscal 2002.

We are in discussion with respect to financial responsibility for alleged
inventory commitments related to our Power Electronics Division, and,
accordingly, the outcome is not certain at this time.

Environmental:

The Company is subject to extensive and evolving environmental laws and
regulations regarding the clean-up and protection of the environment, worker
health and safety and the protection of third parties. These laws and
regulations include, but are not limited to: (i) requirements relating to the
handling, storage, use and disposal of lead and other hazardous materials used
in manufacturing processes and solid wastes; (ii) record keeping and periodic
reporting to governmental entities regarding the use of hazardous substances and
disposal of hazardous wastes; (iii) monitoring and permitting of air and water
emissions; and (iv) monitoring worker exposure to hazardous substances in the
workplace, and protecting workers from impermissible exposure to hazardous
substances, including lead, used in our manufacturing process.

Notwithstanding the Company's efforts to maintain compliance with
applicable environmental requirements, if injury or damage to persons or the
environment arises from hazardous substances used, generated or disposed of in
the conduct of the Company's business (or that of a predecessor to the extent
the Company is not indemnified therefor), the Company may be held liable for
certain damages and for the costs of investigation and remediation, which could
have a material adverse effect on the Company's business, financial condition,
or results of operations. However, under the terms of the purchase agreement
with Allied Corporation ("Allied") for the acquisition of the Company (the
"Acquisition Agreement"), Allied is obligated to indemnify the Company for any
liabilities of this type resulting from conditions existing at January 28, 1986
that were not disclosed by Allied to the Company in the schedules to the
Acquisition Agreement.

The Company, along with numerous other parties, has been requested to
provide information to the United States Environmental Protection Agency (the
"EPA") in connection with investigations of the source and extent of
contamination at two lead smelting facilities (the "Third Party Facilities") to
which the Company had made scrap lead shipments for reclamation prior to the
date of the acquisition.

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except per share data)
(UNAUDITED)

6. CONTINGENT LIABILITIES (continued)

The Company and four other potentially responsible parties ("PRPs") have
agreed upon a cost sharing arrangement for the design and remediation phases of
a project related to one of the Third Party Facilities, the former NL Industries
in Pedricktown, New Jersey. A reliable range of the potential cost to the
Company for the ultimate remediation of the site cannot currently be determined,
nor have all the PRPs been identified. Accordingly, the Company has not
established a reserve for this potential exposure.

The Company responded to requests for information from the EPA and the
state environmental agency with regard to another Third Party Facility, the
"Chicago Site", in October 1991. Based on currently available information, the
Company believes that the potential cost of the remediation at the Chicago Site
is likely to range between $8,000 and $10,500 (based on the preliminary
estimated cost of the remediation approach negotiated with the EPA). Sufficient
information is not available to determine the Company's allocable share of this
cost. Based on currently available information, however, the Company believes
that its most likely exposure with respect to the Chicago Site will be the
approximately $283 previously reserved.

Allied has accepted responsibility under the Acquisition Agreement for
potential liabilities relating to all Third Party Facilities other than the
aforementioned sites.

The Company is also aware of the existence of potential contamination at
its Huguenot, New York facility which may require expenditures for further
investigation and remediation. Fluoride contamination in an inactive lagoon
exceeding the state's groundwater standards, which existed prior to the
Company's acquisition of the site, has resulted in the site being listed on the
registry of inactive hazardous waste disposal sites maintained by the New York
State Department of Environmental Conservation. The prior owner of the site
ultimately may bear some, as yet undetermined, share of the costs associated
with this matter. The Company has established what it believes to be an adequate
reserve for all but the remediation costs, the extent of which are not known, as
a remediation plan has not yet been finalized with or approved by the State of
New York.

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except per share data)
(UNAUDITED)

6. CONTINGENT LIABILITIES (continued)

The Company, together with Johnson Controls, Inc. ("JCI"), is conducting an
assessment and remediation of contamination at its Dynasty Division facility in
Milwaukee, Wisconsin. The majority of this project was completed as of October
2001. Under the purchase agreement with JCI, the Company is responsible for (i)
one-half of the cost of the on-site assessment and remediation, with a maximum
liability of $1,750, (ii) any environmental liabilities at the facility that are
not remediated as part of the current project and (iii) environmental
liabilities for claims made after the fifth anniversary of the closing that
arise from migration from a pre-closing condition at the Milwaukee facility to
locations other than the Milwaukee facility, but specifically excluding
liabilities relating to pre-closing offsite disposal. JCI has retained all other
environmental liabilities, including off-site assessment and remediation.

In January 1999, the Company received notification from the EPA of alleged
violations of permit effluent and pretreatment discharge limits at its plant in
Attica, Indiana. The Company submitted a compliance plan to the EPA. A penalty
assessment could be made, however there is insufficient information currently
available to permit the Company to estimate the potential penalty, if any.

The Company accrues reserves for liabilities in the Company's consolidated
financial statements and periodically reevaluates the reserved amounts for these
liabilities in view of the most current information available. Based on
currently available information, management of the Company believes that the
foregoing contingent liabilities will not have a material adverse effect on the
Company's business, financial condition or results of operations.

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except per share data)
(UNAUDITED)

7. OPERATIONS BY INDUSTRY SEGMENT

The Company has identified the following four reportable business segments:

The Powercom Division manufactures and markets integrated reserve power
systems and components for the standby power market which includes
telecommunications, uninterruptible power supplies and utilities. Integrated
reserve power systems monitor and regulate electric power flow and provide
backup power in the event of a primary power loss or interruption. The Powercom
Division also produces the individual components of these systems, including
reserve batteries, power rectifiers, system monitors, power boards and chargers.

The Dynasty Division manufactures and markets industrial batteries
primarily for the uninterruptible power supply ("UPS"), telecommunications and
broadband cable markets. Major applications of these products include wireless
and wireline telephone infrastructure, CATV signal powering, corporate data
center powering and computer network back-up for use during electric utility
outages.

The Power Electronics Division manufactures and markets custom, standard
and modified standard electronic power supply systems, including DC to DC
converters, for large original equipment manufacturers ("OEMs") of
telecommunications equipment, office equipment, workstations and other
applications.

The Motive Power Division manufactures complete systems and individual
components (including power electronics and batteries) to power, monitor, charge
and test the batteries used in electric industrial vehicles, including fork-lift
trucks, automated guided vehicles and airline ground support equipment. These
products are marketed to end users in a broad array of industries, dealers of
fork-lift trucks and other material handling vehicles, and, to a lesser extent,
OEMs.

Summarized financial information related to the Company's business segments
for the three and nine month periods ended October 31, 2001 and 2000 is shown
below:

Power Motive
Powercom Dynasty Electronics Power
Division Division Division Division Consolidated
-------- -------- ----------- -------- ------------

Three months ended October 31, 2001:

Net sales................................ $ 51,009 $ 27,431 $10,785 $13,280 $102,505
Operating income (loss).................. $ 9,622 $ 2,564 $(5,105) $(1,397) $ 5,684

Three months ended October 31, 2000:

Net sales*............................... $ 68,551 $ 42,805 $30,927 $19,639 $161,922
Operating income (loss).................. $ 12,921 $ 10,538 $ 4,507 $(1,422) $ 26,544

Nine months ended October 31, 2001:

Net sales................................ $194,607 $ 89,574 $51,068 $48,132 $383,381
Operating income (loss).................. $ 49,667 $ 13,499 $(4,733) $ (66) $ 58,367

Nine months ended October 31, 2000:

Net sales*............................... $197,966 $119,444 $75,408 $59,271 $452,089
Operating income (loss).................. $ 37,591 $ 26,759 $ 6,748 $ (564) $ 70,534

* Reclassified for comparative purposes.

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except per share data)
(UNAUDITED)

8. DERIVATIVE INSTRUMENTS

On February 1, 2001, the Company adopted Statement of Financial Accounting
Standard ("SFAS") No. 133, "Accounting for Derivative Instruments and Hedging
Activities," as amended by SFAS No. 138, "Accounting for Certain Derivative
Instruments and Certain Hedging Activities." SFAS No. 133, as amended,
establishes accounting and reporting standards for derivative instruments.
Specifically, SFAS No. 133 requires an entity to recognize all derivatives as
either assets or liabilities in the statement of financial position and to
measure those instruments at fair value. Additionally, the fair value
adjustments will affect either stockholders' equity or net income depending on
whether the derivative instrument qualifies as a hedge for accounting purposes
and, if so, the nature of the hedging activity. As of February 1, 2001, the
adoption of the new standard resulted in a cumulative effect net-of-tax increase
of $103 to accumulated other comprehensive loss.

In the normal course of business, the Company uses a variety of derivative
financial instruments primarily to manage currency exchange rate and interest
rate risk. All derivatives are recognized on the balance sheet at fair value and
are generally reported in accrued liabilities. To qualify for hedge accounting,
the Company requires that the instruments are effective in reducing the risk
exposure that they are designated to hedge. For instruments that are associated
with the hedge of an anticipated transaction, hedge effectiveness criteria also
require that it be probable that the underlying transaction will occur.
Instruments that meet established accounting criteria are formally designated as
hedges at the inception of the contract. These criteria demonstrate that the
derivative is expected to be highly effective at offsetting changes in fair
value of the underlying exposure both at inception of the hedging relationship
and on an ongoing basis. The assessment for effectiveness is formally documented
at hedge inception and reviewed at least quarterly throughout the designated
hedge period.

The Company applies hedge accounting in accordance with SFAS No. 133,
whereby the Company designates each derivative as a hedge of (i) the fair value
of a recognized asset or liability or of an unrecognized firm commitment ("fair
value" hedge); or (ii) the variability of anticipated cash flows of a forecasted
transaction or the cash flows to be received or paid related to a recognized
asset or liability ("cash flow" hedge). From time to time, however, the Company
may enter into derivatives that economically hedge certain of its risks, even
though hedge accounting is not allowed by SFAS No. 133 or is not applied by the
Company. In these cases, there generally exists a natural hedging relationship
in which changes in fair value of the derivative, which are recognized currently
in earnings, act as an economic offset to changes in the fair value of the
underlying hedged item(s). The Company did not apply hedge accounting to
currency forward contracts with a combined fair value of $(20) as of October 31,
2001. Changes in the fair value of these currency forward contracts are recorded
in earnings.

Changes in the value of a derivative that is designated as a fair value
hedge, along with offsetting changes in fair value of the underlying hedged
exposure, are recorded in earnings each period. Changes in the value of a
derivative that is designated as a cash flow hedge is recorded in accumulated
other comprehensive income (loss). When earnings are affected by the variability
of the underlying cash flow, the applicable amount of the gain or loss from the
derivative that is deferred in stockholders' equity is released to earnings.
When the terms of an underlying transaction are modified, or when the underlying
hedged item ceases to exist, all changes in the fair value of the instrument are

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except per share data)
(UNAUDITED)

8. DERIVATIVE INSTRUMENTS (continued)

included in earnings each period until the instrument matures. When the
underlying transaction ceases to exist, a hedged asset or liability is no longer
adjusted for changes in its fair value. Derivatives that are not designated as
hedges, as well as the portion of a derivative excluded from the effectiveness
assessment and changes in the value of derivatives which do not offset the
underlying hedged item throughout the designated hedge period, are recorded in
earnings each period.

In the normal course of business, the Company is exposed to the impact of
interest rate changes and foreign currency fluctuations. The Company limits
these risks by following established risk management policies and procedures
including use of derivatives and, where cost-effective, financing with debt in
the currencies in which assets are denominated. For interest rate exposures,
derivatives are used to manage the Company's exposure to fluctuations in
interest rates on the Company's underlying variable rate debt instruments. The
Company employs separate swap transactions rather than fixed rate obligations to
take advantage of the lower borrowing costs associated with floating rate debt
while also eliminating possible risk related to refinancing in the fixed rate
market. For currency exposures, derivatives are used to limit the effects of
foreign exchange rate fluctuations on financial results.

The Company does not use derivatives for trading or speculative purposes,
nor is it a party to leveraged derivatives. Further, the Company has a policy of
only entering into contracts with major financial institutions. When viewed in
conjunction with the underlying and offsetting exposure that the derivatives are
designed to hedge, the Company has not sustained a material loss from these
instruments nor does it anticipate any material adverse effect on its net income
or financial position in the future from the use of derivatives.

The following table includes all interest rate swaps as of October 31,
2001. These interest rate swaps are designated as cash flow hedges and,
therefore, changes in the fair value are recorded in accumulated other
comprehensive loss.

Fixed Variable
Interest Interest
Notional Origination Maturity Rate Rate Fair
Amount Date Date Paid Received Value
-------- ----------- -------- -------- -------- -----

$ 6,500 12/20/95 12/20/02 6.01% LIBOR $ (260)
20,000 03/11/99 03/11/02 5.58% LIBOR (239)
20,000 02/05/01 03/01/03 5.24% LIBOR (745)
20,000 04/11/01 04/11/06 5.56% LIBOR (1,286)
-----
$(2,530)
=====

C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except per share data)
(UNAUDITED)

9. NEW ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED

In June 2001, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 141, "Business Combinations." This statement addresses financial accounting
and reporting for business combinations. All business combinations in the scope
of this statement are to be accounted for using only the purchase method. The
provisions of this statement apply to all business combinations initiated after
June 30, 2001.

Also in June 2001, the FASB issued SFAS No. 142, "Goodwill and Other
Intangible Assets." This statement addresses financial accounting and reporting
for acquired goodwill and other intangible assets. Under SFAS No. 142, goodwill
and indefinite lived intangible assets are no longer amortized but are reviewed
annually (or more frequently if impairment indicators arise) for impairment.
Separable intangible assets that are not deemed to have an indefinite life will
continue to be amortized over their useful lives. Goodwill and other intangible
assets acquired prior to July 1, 2001 will continue to be amortized through
January 31, 2002. After January 31, 2002, such goodwill and indefinite lived
intangible assets will cease being amortized.

The Company is currently evaluating the potential impact, if any, of the
application of the goodwill impairment provisions of the new rules on its
financial position and results of operations. Based on acquisitions completed as
of October 31, 2001, application of the goodwill non-amortization provisions of
these rules, without considering any of the potential impairment, is expected to
result in an increase in income before income taxes of approximately $6,200 for
fiscal 2003.

In August 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations." This statement addresses financial accounting and
reporting requirements for obligations associated with the retirement of
tangible long-lived assets and the associated retirement costs. SFAS No. 143 is
effective for fiscal years beginning after June 15, 2002. The Company is
currently in the process of evaluating the impact that SFAS No. 143 will have on
its financial position and results of operations, if any.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of."
This statement addresses financial accounting and reporting for the impairment
or disposal of long-lived assets. SFAS No. 144 supersedes SFAS No. 121 and the
accounting and reporting provisions of the Accounting Principles Board ("APB")
Opinion No. 30. SFAS No. 144 is effective for fiscal years beginning after
December 15, 2001. The Company is currently in the process of evaluating the
impact that SFAS No. 144 will have on its financial position and results of
operations, if any.

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders of C&D Technologies, Inc.

We have reviewed the accompanying consolidated balance sheet of C&D
Technologies, Inc. and Subsidiaries (the "Company") as of October 31, 2001 and
the related consolidated statements of income and comprehensive income for each
of the three-month and nine-month periods ended October 31, 2001 and 2000, and
the consolidated statement of cash flows for the nine-month periods ended
October 31, 2001 and 2000. These financial statements are the responsibility of
the Company's management.

We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should
be made to the accompanying consolidated interim financial statements for them
to be in conformity with accounting principles generally accepted in the United
States of America.

We previously audited in accordance with auditing standards generally accepted
in the United States of America, the consolidated balance sheet as of January
31, 2001 and the related consolidated statements of income, stockholders'
equity, cash flows, and comprehensive income for the year then ended (not
presented herein), and in our report dated March 6, 2001 we expressed an
unqualified opinion on those consolidated financial statements. In our opinion,
the information set forth in the accompanying consolidated balance sheet as of
January 31, 2001, is fairly stated in all material respects in relation to the
consolidated balance sheet from which it has been derived.

/s/ PricewaterhouseCoopers LLP
- ------------------------------

PRICEWATERHOUSECOOPERS LLP

Philadelphia, Pennsylvania
November 20, 2001

Item 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
(Dollars in thousands, except per share data)

Within the following discussion, unless otherwise stated, "quarter" and
"nine-month period" refer to the third quarter of fiscal 2002 and the nine
months ended October 31, 2001. All comparisons are with the corresponding
periods in the prior year, unless otherwise stated.

In December 2000 (effective as of November 26, 2000), we acquired the
Newport Components Division of Newport Technology Group Limited, a producer of
electronic power conversion products (primarily DC to DC converters) based in
the United Kingdom. For reporting purposes, this acquisition is included as part
of the Power Electronics Division and is referred to as C&D Technologies (NCL)
Limited ("NCL").

Net sales decreased $59,417 or 37% for the quarter and $68,708 or 15% for
the nine-month period. The decrease in sales during the quarter was the result
of lower sales by all divisions. Sales of the Power Electronics Division
decreased $20,142 or 65% during the quarter, primarily due to lower DC to DC
converter sales partially offset by sales recorded by NCL. Sales of the Powercom
Division decreased $17,542 or 26% during the quarter, primarily due to lower
sales to the telecommunications market. Sales of the Dynasty Division decreased
$15,374 or 36% during the quarter, primarily as a result of lower sales to the
UPS, CATV and telecommunications markets. Motive Power divisional sales
decreased $6,359 or 32% during the quarter, due to lower battery and charger
sales. The decrease in sales during the nine-month period was also the result of
lower sales by all divisions. Sales of the Dynasty Division decreased $29,870 or
25% during the nine-month period, primarily as a result of lower sales to the
UPS, CATV and telecommunications markets. Power Electronics divisional sales
decreased $24,340 or 32% during the nine-month period, primarily due to lower DC
to DC converter sales, partially offset by sales recorded by NCL. Sales of the
Motive Power Division decreased $11,139 or 19% during the nine-month period, due
to lower battery and charger sales. Sales of the Powercom Division decreased
$3,359 or 2% during the nine-month period, primarily due to lower sales to the
telecommunications market, partially offset by higher sales to the UPS and
control markets.

Gross profit for the quarter decreased $23,301 or 51% to $22,110 from
$45,411 in the third quarter of the prior year, resulting in a gross margin of
21.6% versus 28.0% in the third quarter of fiscal 2001. Gross profit (loss)
during the quarter was lower for all divisions, primarily due to the decreased
sales volumes generated by all of the divisions, coupled with an
inventory-related charge in our Power Electronics Division. Gross profit for the
nine-month period decreased $22,009 or 17% to $105,652 from $127,661 in the
comparable period of the prior year, resulting in a decrease in gross margin
from 28.2% in the first nine months of fiscal 2001 to 27.6% in the first nine
months of the current year. Gross profit for the nine-month period was lower in
the Dynasty, Power Electronics and Motive Power divisions, primarily as a result
of lower sales volumes. Gross profit of the Power Electronics Division was also
negatively impacted by the aforementioned inventory-related charge. These
decreases were partially offset by higher gross margin in the Powercom Division.

Selling, general and administrative expenses for the quarter decreased
$2,388 or 15% compared to the comparable quarter of the prior year. This
decrease was primarily due to: (i) lower variable selling costs associated with
the decreased sales volumes; (ii) lower fixed selling costs (primarily personnel
costs, warranty and advertising); and (iii) lower bonus accruals. Partially
offsetting this decrease were costs related to a potential acquisition that did
not close, coupled with selling, general and administrative expenses related to
the recent acquisition of NCL, including amortization of goodwill and other
intangible assets. For the nine-month period, selling, general and
administrative expenses decreased $10,215 or 21%. This decrease was primarily
due to: (i) the reduction of general and administrative expenses associated with
the full recovery of litigation settlement costs from our insurance carriers in
the first quarter of fiscal 2002 which was reserved for in the nine-month period
ended October 31, 2000; (ii) lower fixed selling costs (primarily personnel
costs, warranty and advertising); (iii) lower bonus accruals; and (iv) lower
variable selling costs associated with the decreased sales volume. Partially
offsetting this decrease were costs related to the aforementioned potential
acquisition that did not close, coupled with selling, general and administrative
expenses related to the recent acquisition of NCL, including amortization of
goodwill and other intangible assets.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued)
(Dollars in thousands, except per share data)

Research and development expenses remained proportional to sales as a
relative percentage of sales for the quarter and nine-month period at
approximately 2% of sales.

Operating income for the quarter decreased $20,860 or 79% to $5,684 as a
result of lower operating income generated by the Dynasty and Powercom
divisions, coupled with an operating loss by the Power Electronics Division
during the quarter, as compared to operating income in the prior year, partially
offset by a decrease in the operating loss in the Motive Power Division. For the
nine-month period, operating income decreased $12,167 or 17% to $58,367 as a
result of lower operating income generated by the Dynasty Division, coupled with
an operating loss by the Power Electronics Division, as compared to operating
income in the prior year. These decreases were partially offset by an increase
in operating income generated by the Powercom Division, coupled with a decrease
in the operating loss generated by the Motive Power Division. Operating income
for the quarter and for the nine-month period was negatively impacted by a
pre-tax charge of $4,000, primarily due to costs related to a potential
acquisition that did not close.

Interest expense, net, increased $378 in the quarter and $672 in the
nine-month period, primarily due to higher debt balances outstanding related to
the acquisition of NCL in the fourth quarter of fiscal 2001, partially offset by
lower effective interest rates.

Income tax expense decreased $8,494 for the quarter and $5,539 for the
nine-month period, primarily as a result of lower income before income taxes.
The effective tax rate consists of statutory rates adjusted for the tax impacts
of our foreign sales corporation, foreign operations and research and
development credits. The effective tax rate for the first nine months of fiscal
2002 decreased to 37.0% from 37.8% in the comparable period of the prior year.

Minority interest decreased $582 for the quarter and $617 for the
nine-month period as a result of lower profitability of our joint venture
battery business located in Shanghai, China.

As a result of the above, net income decreased $12,897 or 87% in the
quarter to $1,848 or $.07 per share - basic and per share - diluted. For the
nine-month period, net income decreased $7,394 or 19% to $31,795 or $1.22 per
share - basic and $1.19 per share - diluted. Net income for the quarter and
nine-month period include the aforementioned charge, which was $2,520 on an
after-tax basis.

Liquidity and Capital Resources

Net cash provided by operating activities increased $8,767 or 17% to
$59,519 for the nine-month period ended October 31, 2001 compared to $50,752 for
the comparable period of the prior year. This increase in net cash provided by
operating activities was primarily due to: (i) a decrease in accounts receivable
and inventory in the first nine months of the current year compared to an
increase in the same period of the prior year; and (ii) an increase in
depreciation and amortization during the nine-month period. These changes
resulting in higher net cash provided by operating activities were partially
offset by: (i) a larger reduction in accounts payable; (ii) a decrease in
accrued liabilities and current taxes payable in the first nine months of fiscal
2002 compared to an increase in the comparable period of the prior year; and
(iii) a decrease in net income.

Net cash used by investing activities in the first nine months of fiscal
2002 decreased $6,817 over the comparable period of the prior year primarily due
to lower capital spending.

Net cash used by financing activities in the nine-month period increased
$16,569 over the comparable period of the prior year primarily due to: (i)
higher debt repayments; (ii) higher treasury stock purchases; and (iii) lower
proceeds from the issuance of common stock. These changes resulting in higher
cash used by financing activities were partially offset by higher proceeds from
new borrowings. During the period, we obtained a 22 million British Pound
Sterling line of credit of which approximately 8.2 million British Pounds
Sterling (or $11,921) of the loan was outstanding at October 31, 2001.

The availability under our current loan agreements is expected to be
sufficient to meet our ongoing cash needs for working capital requirements, debt
service, capital expenditures and possible strategic acquisitions. Capital
expenditures during the first nine months of fiscal 2002 were incurred primarily
to fund capacity expansion, a continuing series of cost reduction programs,
normal maintenance capital, and regulatory compliance. Fiscal 2002 capital
expenditures are expected to total approximately $25,000.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued)
(Dollars in thousands, except per share data)

NEW ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED

In June 2001, the FASB issued SFAS No. 141, "Business Combinations." This
statement addresses financial accounting and reporting for business
combinations. All business combinations in the scope of this statement are to be
accounted for using only the purchase method. The provisions of this statement
apply to all business combinations initiated after June 30, 2001.

We are currently evaluating the potential impact, if any, of the
application of the goodwill impairment provisions of the new rules on our
financial position and results of operations. Based on acquisitions completed as
of October 31, 2001, application of the goodwill non-amortization provisions of
these rules, without considering any of the potential impairment, is expected to
result in an increase in income before income taxes of approximately $6,200 for
fiscal 2003.

In August 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations." This statement addresses financial accounting and
reporting requirements for obligations associated with the retirement of
tangible long-lived assets and the associated retirement costs. SFAS No. 143 is
effective for fiscal years beginning after June 15, 2002. We are currently in
the process of evaluating the impact SFAS No. 143 will have on our financial
position and results of operations, if any.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of."
This statement addresses financial accounting and reporting for the impairment
or disposal of long-lived assets. SFAS No. 144 supersedes SFAS No. 121 and the
accounting and reporting provisions of APB Opinion No. 30. SFAS No. 144 is
effective for fiscal years beginning after December 15, 2001. We are currently
in the process of evaluating the impact SFAS No. 144 will have on our financial
position and results of operations, if any.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued)
(Dollars in thousands, except per share data)

FORWARD-LOOKING STATEMENTS

Certain of the statements and information contained in this Quarterly
Report on Form 10-Q, including, without limitation, information appearing under
Item 2, "Management's Discussion and Analysis of Financial Condition and Results
of Operations," are "forward-looking statements" (within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934) and, accordingly, are subject to risks and uncertainties. For such
statements, C&D claims the protection of the safe-harbor for forward-looking
statements contained in the Private Securities Litigation Act of 1995. The
factors that could cause actual results to differ materially from anticipated
results expressed or implied in any forward-looking statement include those
referenced in the forward-looking statement, following the forward-looking
statement, described in the notes to the Consolidated Financial Statements and
other factors discussed in this Quarterly Report on Form 10-Q and our other
filings with the Securities and Exchange Commission. Readers are cautioned not
to place undue reliance on these forward-looking statements, which speak only as
of the date of this Quarterly Report on Form 10-Q. We undertake no obligation to
update or revise these statements to reflect events or circumstances occurring
after the date of this Quarterly Report on Form 10-Q.

Forward-looking statements may be identified by their use of words like
"plans," "expects," "will," "anticipates," "intends," "projects," "estimates" or
other words of similar meaning. All statements that address expectations or
projections about the future, including statements about our strategy for
growth, product development, market position, expenditures and financial
results, are forward-looking statements. Forward-looking statements are based on
certain assumptions and expectations of future events. We cannot guarantee that
these assumptions and expectations are accurate or will be realized. Following
are some of the important factors that could cause our actual results to differ
materially from those projected in any such forward-looking statements:

o We operate worldwide and derive a portion of our revenue from sales outside
the United States. Changes in the laws or policies of governmental and
quasi-governmental agencies, as well as social and economic conditions, in
the countries in which we operate could affect our business in these
countries and our results of operations. In addition, economic factors
(including inflation and fluctuations in interest rates and foreign
currency exchange rates) and competitive factors (such as price
competition, business combinations of competitors or a decline in industry
sales from slowing economic growth) in the countries in which we conduct
business could affect our results of operations.

o Our results of operations could be significantly impacted by adverse
conditions in the domestic and global economies or the markets in which we
conduct business, such as telecommunications, UPS, CATV, switchgear and
control and material handling.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued)
(Dollars in thousands, except per share data)

FORWARD-LOOKING STATEMENTS (continued)

o Our ability to grow earnings could be affected by increases in the cost of
raw materials, particularly lead. We may not be able to fully offset the
effects of higher raw material costs through price increases or
productivity improvements.

o Our ability to meet customer demand depends, in part, on our ability to
obtain timely and adequate delivery of parts and components from our
suppliers and internal manufacturing capacity. Although we work closely
with our suppliers to avoid shortages, there can be no assurance that we
will not encounter shortages in the future. A reduction or interruption in
component supply or a significant increase in the price of one or more
components could have a material adverse effect on our operations.

o Our growth objectives are largely dependent on our ability to renew our
pipeline of new products and to bring these products to market. This
ability may be adversely affected by difficulties or delays in product
development, such as the inability to: identify viable new products;
successfully complete research and development projects; obtain adequate
intellectual property protection; or gain market acceptance of the new
products. Our growth objectives are also largely dependent upon our ability
to successfully expand our production capacity.

o As part of our strategy for growth, we have made and may continue to make
acquisitions, and in the future, may make divestitures and form strategic
alliances. There can be no assurance that these will be completed or
beneficial to us.

o Our facilities are subject to a broad array of environmental laws and
regulations. The costs of complying with complex environmental laws and
regulations, as well as internal voluntary programs, are significant and
will continue to be so for the foreseeable future, and may increase as a
result of any future changes to those laws and regulations or in
enforcement practices. Our accruals for such costs and liabilities may not
be adequate since the estimates on which the accruals are based depend on a
number of factors including the nature of the problem, the complexity of
the site, the nature of the remedy, the outcome of discussions with
regulatory agencies and other PRPs at multiparty sites, and the number and
financial viability of other PRPs.

o Our business, results of operations and financial condition could be
affected by significant pending and future litigation adverse to C&D, such
as, without limitation, product liability, contract and employment-related
claims and claims arising from any injury or damage to persons or the
environment from hazardous substances used, generated or disposed of in the
conduct of C&D's business (or that of a predecessor to the extent C&D is
not indemnified for those liabilities).

o Our performance depends on our ability to attract and retain qualified
personnel. We cannot assure that we will be able to continue to attract and
retain qualified personnel.

The foregoing list of important factors is not all-inclusive, or
necessarily in order of importance.

PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K.

(a) Exhibits

10.1 Agreement and Release dated August 16, 2001 between John Rich and
C&D (filed herewith).

10.2 Employment Agreement dated August 6, 2001 between James D.
Johnson and C&D (filed herewith).

15. Letter from PricewaterhouseCoopers LLP, independent accountants
for C&D, regarding unaudited interim financial information (filed
herewith).

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 thereunto duly authorized.

C&D TECHNOLOGIES, INC.

December 13, 2001 BY: /s/ Wade H. Roberts, Jr.
---------------------------------
Wade H. Roberts, Jr.
President, Chief Executive
Officer and Director
(Principal Executive Officer)

December 13, 2001 BY: /s/ Stephen E. Markert, Jr.
----------------------------------
Stephen E. Markert, Jr.
Vice President Finance
(Principal Financial and
Accounting Officer)

EXHIBIT INDEX

10.1 Agreement and Release dated August 16, 2001 between John Rich and
C&D.

10.2 Employment Agreement dated August 6, 2001 between James D.
Johnson and C&D.

15. Letter from PricewaterhouseCoopers LLP, independent accountants
for C&D, regarding unaudited interim financial information.