<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 29, 1997
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ________ TO _________
COMMISSION FILE NUMBER _________________
EURAMAX INTERNATIONAL PLC
(Exact name of registrant as specified in its charter)
England and Wales 98-1066997
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
5335 Triangle Parkway, Suite 550, Norcross, Georgia 30092
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 770-449-7066
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. /X/ Yes / / No
As of May 9, 1997, Registrant has outstanding 1,000,000 Ordinary Shares
and 34,000,000 Preference Shares. All of these shares were owned by
affiliates.
<PAGE>
PART I--FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
EURAMAX INTERNATIONAL PLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Thousands of U.S. Dollars)
(Unaudited)
SUCCESSOR PREDECESSOR
QUARTER ENDED QUARTER ENDED
MARCH 29, MARCH 31,
1997 1996
-------------- --------------
Net Sales.......................... $ 114,874 $ 111,395
Costs and expenses:
Cost of goods sold............... 92,036 93,457
Selling and general.............. 10,639 10,209
Depreciation and amortization.... 2,695 2,397
------------- -------------
105,370 106,063
------------- -------------
Earnings from operations........ 9,504 5,332
Interest expense, net.............. (5,618) (157)
Other income (expense), net........ (40) (118)
------------- -------------
Earnings before income taxes.... 3,846 5,057
Provision for income taxes...... 1,241 1,922
------------- -------------
Net earnings.................... 2,605 3,135
Dividends on redeemable preference
shares........................... 1,233 --
------------- -------------
Net earnings available for
ordinary shareholders............ $ 1,372 $ 3,135
------------- -------------
------------- -------------
The accompanying notes are an integral part of these condensed
consolidated financial statements.
<PAGE>
EURAMAX INTERNATIONAL PLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Thousands of U.S. Dollars)
(Unaudited)
SUCCESSOR
------------------------
MARCH 29, DECEMBER 27,
1997 1996
---------- ------------
ASSETS
Current Assets:
Cash and cash equivalents................ $ 11,572 $ 12,516
Accounts receivable, net................. 74,285 60,767
Inventories.............................. 82,102 87,235
Deferred income taxes.................... 1,483 1,483
Other current assets..................... 1,875 1,350
---------- -----------
Total current assets................... 171,317 163,351
Property, plant and equipment, net....... 105,811 107,338
Goodwill................................. 40,583 40,926
Other assets............................. 17,267 15,678
---------- -----------
$ 334,978 $ 327,293
---------- -----------
---------- -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable......................... $ 40,375 $ 38,221
Accrued expenses......................... 29,089 25,511
Current maturities of long-term debt..... 2,000 2,000
---------- -----------
Total current liabilities.............. 71,464 65,732
Long-term debt, less current maturities.. 208,625 209,740
Other liabilities........................ 4,969 4,722
Deferred income taxes.................... 9,662 9,735
---------- -----------
Total liabilities...................... 294,720 289,929
---------- -----------
Redeemable preference shares............. 36,423 35,191
---------- -----------
Ordinary shareholders' equity:
Ordinary shares.......................... 1,000 1,000
Retained earnings (deficit).............. 1,187 (185)
Foreign currency translation adjustment.. 1,648 1,358
---------- -----------
Total ordinary shareholders' equity.... 3,835 2,173
---------- -----------
$ 334,978 $ 327,293
---------- -----------
---------- -----------
The accompanying notes are an integral part of these condensed
consolidated financial statements.
<PAGE>
EURAMAX INTERNATIONAL PLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands of U.S. Dollars)
(Unaudited)
SUCCESSOR PREDECESSOR
QUARTER ENDED QUARTER ENDED
MARCH 29, MARCH 31,
1997 1996
-------------- --------------
Net cash provided by (used in)
operating activities....................... $ (3,354) $ 796
-------------- --------------
Cash flows from investing activities:
Capital expenditures....................... (867) (3,757)
------- -------
Net cash used in investing activities.... (867) (3,757)
------- -------
Cash flows from financing activities:
Borrowings on revolving credit facility....... 707 --
Proceeds from sale of assets............... 48 78
Net change in due to parent/affiliate...... -- (7,222)
------- -------
Net cash provided by (used in) financing
activities.............................. 755 (7,144)
------- -------
Effect of exchange rate changes on cash...... 2,522 (10)
------- -------
Net decrease in cash and equivalents......... (944) (10,115)
Cash and equivalents at beginning of
period..................................... 12,516 12,587
------- -------
Cash and equivalents at end of period........ $ 11,572 $ 2,472
------- -------
------- -------
The accompanying notes are an integral part of these condensed
consolidated financial statements.
<PAGE>
EURAMAX INTERNATIONAL PLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Thousands of U.S. Dollars)
(UNAUDITED)
1. BASIS OF PRESENTATION
For purposes of this report the "Company" refers to Euramax International
plc and Subsidiaries, collectively.
The condensed consolidated financial statements of the Company have been
prepared in accordance with the rules and regulations of the Securities and
Exchange commission (the "SEC"). In the opinion of the management of the
Company, these statements include all adjustments necessary for a fair
presentation of the results of operations all interim periods reported
herein. All adjustments are of a normal recurring nature unless otherwise
disclosed. Management believes that the disclosures made are adequate for a
fair presentation of results of operation, financial position and cash flows.
These condensed consolidated financial statements should be read in
conjunction with the year-end consolidated financial statements and
accompanying notes included in the Company's Form 10-K. Operating results for
the period ended March 29, 1997, are not necessarily indicative of future
results that may be expected for the year ending December 26, 1997.
2. ACQUISITION
Pursuant to a purchase agreement between the Company and Alumax Inc.
("Alumax"), on September 25, 1996, the Company purchased, through its
wholly-owned subsidiaries, all of the issued and outstanding capital stock of
the following Alumax subsidiaries which operated certain portions of Alumax's
fabricated products operations: (i) Amerimax Fabricated Products, Inc. and
its wholly owned subsidiaries, Amerimax Specialty Products, Inc., Amerimax
Building Products, Inc., Amerimax Coated Products, Inc., Johnson Door
Products, Inc., and Amerimax Home Products, Inc.; (ii) Euramax Holdings
Limited and its wholly owned subsidiaries, Ellbee Limited and Euramax Coated
Products Limited; (iii) Euramax Europe B.V. and its wholly owned subsidiary,
Euramax Coated Products B.V.; and (iv) Euramax Industries S.A. and its wholly
owned subsidiary Euramax Coated Products S.A. For purposes of identification
and description, the acquired business is referred to as the "Predecessor"
for the periods prior to the Acquisition, "Euramax" or the "Successor" for
the period subsequent to the Acquisition, and the "Company" for both periods.
The financial statements of the Predecessor include the combined accounts of
the entities referred to as Fabricated Products. Such Predecessor financial
statements have been prepared as if the Company's businesses had operated as
an independent stand-alone entity for all periods presented. Certain
obligations were originally recorded by Alumax on behalf of the Company such
as post-retirement and post-employment benefit obligations, income taxes,
legal and other corporate expenses. These obligations have been allocated to
the Company's financial statements using several factors including revenues
or number of employees or other reasonable methods. Corporate expenses of
Alumax have been allocated to the Company on a basis management believes is
reasonable and represents the expenses as if the Company were a stand alone
operation. All significant intercompany accounts and transactions have been
eliminated.
The purchase price for the Acquisition was approximately $251.2 million,
which includes estimated acquisition expenses of approximately $3.9 million,
is adjusted to give effect to certain items including cash acquired and
working capital, and was allocated to the assets and liabilities of the
Company based upon their estimated fair market value at the date of
Acquisition under the purchase method of accounting. Such initial purchase
price is subject to adjustment based upon the completion of a special audit
to determine the change in the Company's working capital (as defined) from
December 31, 1995 through September 25, 1996. Management has estimated such
change in connection with the preparation of the Consolidated Balance Sheet
as of December 27, 1996 and does not expect further adjustments to the
purchase price to be significant. Additionally, the allocation of the
purchase price was, in certain instances, based on preliminary information
and is, therefore, subject to revision when additional asset and liability
valuations are obtained. In the opinion of the Company's management, the
asset and liability valuations for the Acquisition will not be materially
different than initially recorded.
The financing for the Acquisition was provided by: (a) $35.0 million of
preference and ordinary share capital; (b) $135.0 million of Senior
Subordinated Notes; and (c) $100.0 million under a Credit Agreement
aggregating $125.0 million.
<PAGE>
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
For information regarding additional significant accounting
policies, see Note 2 to the consolidated financial statements of the Company
for the year ended December 27, 1996.
4. INVENTORIES:
Inventories were comprised of:
SUCCESSOR
------------------------
MARCH 29, DECEMBER 27,
1997 1996
----------- -----------
Raw materials....................................... $ 58,391 $ 59,429
Work in process..................................... 12,389 12,770
Finished products................................... 11,322 15,036
---------- -----------
$ 82,102 $ 87,235
---------- -----------
---------- -----------
5. COMMITMENTS AND CONTINGENCIES:
The Company has entered into several noncancelable long-term contracts
for the purchase of aluminum at market values. The aluminum contracts expire
in various years through 1999. Contracted amounts of aluminum are less than
the Company's anticipated requirements.
The Company and its subsidiaries are not currently parties to any pending
legal proceedings other than such proceedings incident to its business.
Management believes that such proceedings would not, individually or in the
aggregate, reasonably be expected to have a material adverse effect on the
consolidated financial position or results of operations of the Company and
its subsidiaries taken as a whole.
The Company has been named as a defendant in lawsuits or as a potentially
responsible party in state and Federal administrative and judicial
proceedings seeking contribution for costs associated with the investigation,
analysis, correction and remediation of environmental conditions at various
hazardous waste disposal sites. The Company continues to monitor these
actions and proceedings and to vigorously defend both its own interests as
well as the interests of its affiliates. The Company's ultimate liability in
connection with present and future environmental claims will depend on many
factors, including its volumetric share of the waste at a given site, the
remedial action required, the total cost of remediation, and the financial
viability and participation of the other entities that also sent waste to the
site. Once it becomes probable that the Company will incur costs in
connection with remediation of a site and such costs can be reasonably
estimated, the Company establishes or adjusts its reserve for its projected
share of these costs. Based upon current law and information known to the
Company concerning the size of the sites known to it, anticipated costs,
their years of operations and the number of other potentially responsible
parties, management believes that it has adequate reserves for the Company's
potential share of the estimated aggregate liability for the costs of
remedial actions and related costs and expenses. In addition, the Company
establishes reserves for remedial measures required from time to time at its
own facilities. Management believes that the reasonably probable outcomes of
these matters will not materially exceed established reserves and will not
have a material impact on the future financial position, net earnings or cash
flows of the Company. The Company's reserves, expenditures and expenses for
all environmental exposures were not significant for any of the dates or
periods presented.
In connection with the Acquisition referred to in Note 1, the Company was
indemnified by Alumax for substantially all of its costs, if any, related to
environmental matters for occurrences arising prior to the closing date of
the Acquisition during the period of time it was owned directly or indirectly
by Alumax. Such indemnification includes costs that may ultimately be
incurred to contribute to the remediation of certain specified existing
National Priorities List (NPL) sites for which the Company had been named a
potentially responsible party under the federal Comprehensive Environmental
Response, Compensation, and Liability Information System (CERCLA) as of the
closing date of the Acquisition, as well as certain potential costs for sites
listed on state hazardous cleanup lists. With respect to all other
environmental matters, Alumax's obligations are limited to $125.0 million.
However, notwithstanding the indemnity, the Company does not believe that it
has any significant probable liability for environmental claims. Further, the
Company believes it to be unlikely that the Company would be required to bear
environmental costs in excess of its pro rata share of such costs as a
potentially responsible party under CERCLA.
6. SUBSEQUENT EVENT
On May 2, 1997, the Company announced that it has signed a definitive
agreement to purchase a business that manufacturers industrial, commercial,
architectural and agricultural building panels from aluminum and metal, and
is headquartered in Lancaster, Pennsylvania. Completion of the acquisition
is subject to certain due diligence and other conditions, and the final
purchase price will be determined pursuant to the terms of the purchase
agreement. Closing on this transaction is anticipated to be in the latter
part of June.
7. SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENTS:
As described in Note 2, on September 25, 1996, Euramax purchased the
Company from Alumax Inc. The Acquisition was financed, in part, through
Senior Subordinated Notes due 2006 (the "Notes"). The Notes are primary
obligations of Euramax (the "Parent"). The United Kingdom and Netherlands
holding company subsidiaries of Euramax are co-obligors under the Notes (the
"Co-obligors"). The United States holding company subsidiary of Euramax has
provided a full and unconditional guarantee of the Notes (the "Guarantor").
The following supplemental condensed combining financial statements for the
periods prior to the Acquisition, (the "Predecessor" periods) reflect the
combined historical financial position, results of operations and cash flows
of the entities that are the Parent, the Co-obligors and the Guarantor
(collectively, the "Anticipated Parent, Co-obligors and Guarantor"), and such
combined information of the non-guarantor entities, consisting principally of
the operating companies acquired (collectively, the "Non-guarantor
Subsidiaries"). The following supplemental condensed combining financial
statements as of March 29, 1997 and for the periods subsequent to the
Acquisition (the "Successor" periods) reflect the financial position, results
of operations, and cash flows of each of the Parent, the Co-Obligors and
Guarantor entities, and such combined information of the Non-Guarantor
Subsidiaries. The Co-obligors and the Guarantor are wholly-owned subsidiaries
of Euramax and are each jointly, severally, fully, and unconditionally liable
under the Notes. Separate complete financial statements of each Co-obligor
and of the Guarantor are not presented because management has determined that
they are not material to investors. For periods prior to the Acquisition,
there were no significant intercompany balances or transactions between the
Anticipated Parent, Co-obligors and Guarantor entities combined and the
Non-guarantor Subsidiaries.
<PAGE>
<TABLE>
<CAPTION>
PREDECESSOR
----------------------------------------------
FOR THE QUARTER ENDED MARCH 31, 1996
----------------------------------------------
ANTICIPATED
PARENT,
CO-OBLIGORS
AND NON-GUARANTOR COMBINED
GUARANTOR SUBSIDIARIES TOTALS
----------- -------------------- -----------
<S> <C> <C> <C>
Net sales.......................................................... $ $111,395 $ 111,395
Cost and expenses:
Cost of goods sold............................................... 93,457 93,457
Selling and general.............................................. 10,209 10,209
Depreciation and amortization.................................... 2,397 2,397
----------- -------------------- -----------
Earnings from operations......................................... 5,332 5,332
Interest income (expense), net..................................... (157) (157)
Other expense, net................................................. (118) (118)
----------- -------------------- -----------
Earnings before income taxes..................................... 5,057 5,057
Provision for income taxes......................................... 1,922 1,922
----------- -------------------- -----------
Net earnings....................................................... $ $ 3,135 $ 3,135
----------- -------------------- -----------
----------- -------------------- -----------
</TABLE>
Note: Separate columns for the Anticipated Parent, the Co-obligors and the
Guarantor are not presented as there were no amounts for such entities for
the periods shown.
7. Supplemental Condensed Containing Financial Statements (Continued):
<PAGE>
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------
SUCCESSOR FOR THE THREE MONTHS ENDED MARCH 29, 1997
-------------------------------------------------------------------------------------------------------
CO-OBLIGORS AND GUARANTOR SUBSIDIARIES
-------------------------------------------------------------
EURAMAX
EURAMAX EURAMAX EUROPEAN
INTERNATIONAL AMERIMAX EUROPEAN HOLDINGS,
PLC HOLDINGS, INC. HOLDINGS PLC B.V. NON-GUARANTOR CONSOLIDATED
Thousands of U.S. Dollars (PARENT) (GUARANTOR) (CO-OBLIGOR) (CO-OBLIGOR) SUBSIDIARIES ELIMINATIONS TOTALS
------------- --------------- -------------- ------------- -------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net sales.............. $ -- $ -- $ -- $ -- $ 114,874 -- $ 114,874
Cost and expenses:
Cost of goods sold... -- -- -- -- 92,036 -- 92,036
Selling and
general............. -- -- -- -- 10,639 -- 10,639
Depreciation and
amortization........ -- -- -- -- 2,695 -- 2,695
------------- ------------- ------------- ------------- ------------- ------------ ----------
Earnings from
operations.......... -- -- -- -- 9,504 -- 9,504
Equity in earnings of
subsidiaries......... 2,605 1,075 1,377 2,354 6,434 (13,845) --
Interest expense,
net.................. -- (3,254) (815) (580) (969) -- (5,618)
Other expense, net..... -- -- -- -- (40) -- (40)
------------- ------------- ------------- ------------- ------------- ------------ ------------
Earnings before income
taxes............... 2,605 (2,179) 562 1,774 14,929 (13,845) 3,846
Provision (benefit) for
income taxes....... -- (1,167) (285) (203) 2,896 -- 1,241
------------- ------------- ------------- ------------- ------------- ------------ ------------
Net earnings (loss).... 2,605 (1,012) 847 1,977 12,033 (13,845) 2,605
Dividends on redeemable
preference shares.... (1,233) -- -- -- -- -- (1,233)
------------- ------------- ------------- ------------- ------------- ------------ ------------
Net earnings available for
ordinary shareholders.. $ 1,372 $(1,012) $847 $1,977 $12,033 $(13,845) $1,372
------------- ------------- ------------- ------------- ------------- ------------ ------------
------------- ------------- ------------- ------------- ------------- ------------ ------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------
SUCCESSOR AS OF MARCH 29, 1997
--------------------------------------------------------------------------------------------------------
CO-OBLIGORS AND GUARANTOR SUBSIDIARIES
----------------------------------------------------------
EURAMAX
EURAMAX AMERIMAX EURAMAX EUROPEAN
INTERNATIONAL HOLDINGS, EUROPEAN HOLDINGS,
PLC INC. HOLDINGS PLC B.V. NON-GUARANTOR CONSOLIDATED
(PARENT) (GUARANTOR) (CO-OBLIGOR) (CO-OBLIGOR) SUBSIDIARIES ELIMINATIONS TOTALS
--------------- ------------- ------------ ------------- -------------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Current Assets:
Cash and cash
equivalents.. $ 124 $ -- $ -- $ -- $ 11,448 $ -- $ 11,572
Accounts
receivable,
net.......... -- -- -- -- 74,285 -- 74,285
Inventories.... -- -- -- -- 82,263 (161) 82,102
Deferred income
taxes........ -- -- -- -- 1,483 -- 1,483
Other current
assets....... -- -- -- -- 1,875 -- 1,875
--------------- ------------- ------------ ------------- -------------- ------------- ------------
Total current
assets...... 124 -- -- -- 171,354 (161) 171,317
Property, plant
and equipment,
net.......... -- -- -- -- 105,811 -- 105,811
Amounts due from
parent/
affiliates..... 72,120 -- -- 3,364 25,758 (101,242) --
Goodwill......... -- -- -- -- 40,583 -- 40,583
Investment in
consolidated
subsidiaries... 40,698 143,817 34,878 40,128 258,077 (517,598) --
Other assets..... 7,488 3,293 831 1,074 4,581 -- 17,267
-------------- -------------- ------------ ------------- -------------- ------------- ------------
$ 120,430 $147,110 $35,709 $ 44,566 $ 606,164 $(619,001) $ 334,978
-------------- -------------- ------------ ------------- -------------- ------------- ------------
-------------- -------------- ------------ ------------- -------------- ------------- ------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts
payable........ $ -- $ -- $ -- $ -- $ 40,375 $ -- $ 40,375
Accrued
expenses....... (28) 2,589 1,114 1,003 24,411 -- 29,089
Current
maturities
of long-term
debt........... -- -- -- -- 2,000 -- 2,000
--------------- ------------- ------------ ------------- -------------- ------------- ------------
Total current
liabilities.... (28) 2,589 1,114 1,003 66,786 -- 71,464
Long-term debt,
less current
maturities..... 80,200 29,800 23,900 30,900 43,825 -- 208,625
Amounts due to
parent/
affiliates..... -- 99,336 2,067 -- -- (101,403) --
Other liabilities -- -- -- -- 4,969 -- 4,969
Deferred income
taxes.......... -- -- -- -- 9,662 -- 9,662
--------------- ------------- ------------ ------------- ---------------- ------------- ------------
Total
liabilities.... 80,172 131,725 27,081 31,903 125,242 (101,403) 294,720
--------------- ------------- ------------ ------------- ---------------- ------------- ------------
<PAGE>
Redeemable
preference
shares......... 36,423 -- -- -- -- -- 36,423
--------------- ------------- ------------ ------------- -------------- ------------- ------------
Ordinary
shareholders'
equity:
Ordinary
shares......... 1,000 -- 78 23 74 (175) 1,000
Paid-in capital.. -- 17,000 6,922 9,077 456,433 (489,432) --
Retained earnings
(deficit)...... 1,187 (1,615) 1,333 2,815 22,029 (24,562) 1,187
Cumulative
foreign
translation
adjustment..... 1,648 -- 295 748 2,386 (3,429) 1,648
--------------- ------------- ------------ ------------- -------------- ------------- ------------
Total ordinary
shareholders'
equity......... 3,835 15,385 8,628 12,663 480,922 (517,598) 3,835
--------------- ------------- ------------ ------------- -------------- ------------- ------------
$ 120,430 $ 147,110 $ 35,709 $ 44,566 $ 606,164 $ (619,001) $ 334,978
--------------- ------------- ------------ ------------- -------------- ------------- ------------
--------------- ------------- ------------ ------------- -------------- ------------- ------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------
SUCCESSOR AS OF DECEMBER 27, 1996
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
CO-OBLIGORS AND GUARANTOR SUBSIDIARIES
-------------------------------------------------------------
<CAPTION>
EURAMAX
EURAMAX AMERIMAX EURAMAX EUROPEAN
INTERNATIONAL HOLDINGS, EUROPEAN HOLDINGS,
PLC INC. HOLDINGS PLC B.V. NON-GUARANTOR CONSOLIDATED
Current Assets (PARENT) (GUARANTOR) (CO-OBLIGOR) (CO-OBLIGOR) SUBSIDIARIES ELIMINATIONS TOTALS
--------------- ------------- ------------ ------------- -------------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Cash and cash
equivalents.... $ 124 $ -- $ -- $ -- $ 12,392 $ -- $ 12,516
Accounts
receivable,
net............ -- -- -- -- 60,767 -- 60,767
Inventories...... -- -- -- -- 87,235 87,235
Deferred income
taxes.......... -- -- -- -- 1,483 -- 1,483
Other current
assets......... -- -- -- -- 1,350 -- 1,350
--------------- ------------- ------------ ------------- -------------- ------------- -------------
Total current
assets......... 124 -- -- -- 163,227 -- 163,351
Property, plant
and equipment,
net............ -- -- -- -- 107,338 -- 107,338
Amounts due from
parent/
affiliates..... 74,765 -- -- 3,358 34,074 (112,197) --
Goodwill......... -- -- -- -- 40,926 -- 40,926
Investment in
consolidated
subsidiaries... 37,416 142,743 33,205 37,026 253,124 (503,514) --
Other assets..... 7,561 3,476 853 1,102 2,686 -- 15,678
--------------- ------------- ------------ ------------- -------------- ------------- ------------
$ 119,866 $ 146,219 $34,058 $ 41,486 $601,375 $(615,711) $ 327,293
--------------- ------------- ------------ ------------- -------------- ------------- ------------
--------------- ------------- ------------ ------------- -------------- ------------- ------------
LIABILITIES AND SHAREHOLDERS EQUITY
Current
liablilities:
Accounts
payable........ $ -- $ -- $ -- $ -- $ 38,221 $ -- $ 38,221
Accrued
expenses....... 2,330 500 695 898 19,571 -- 23,994
Income taxes
payable........ (28) (1,210) (254) (328) 3,337 -- 1,517
Current
maturities of
long-term
debt........... -- -- -- -- 2,000 -- 2,000
--------------- ------------- ------------ ------------- --------------- ------------- ------------
Total current
liabilities.... 2,302 (710) 441 570 63,129 -- 65,732
Long-term
debt, less
current
maturities..... 80,200 25,000 23,900 30,900 49,740 -- 209,740
Amounts due to
parent/
affiliates..... -- 105,532 884 -- 5,781 (112,197) --
Other
liabilities.... -- -- -- -- 4,722 -- 4,722
Deferred income
taxes.......... -- -- -- -- 9,735 -- 9,735
--------------- ------------- ------------ ------------- -------------- ------------- ------------
Total
liabilities.... 82,502 129,822 25,225 31,470 133,107 (112,197) 289,929
--------------- ------------- ------------ ------------- -------------- ------------- ------------
Redeemable
preference
shares.......... 35,191 -- -- -- -- -- 35,191
--------------- ------------- ------------ ------------- -------------- ------------- ------------
Ordinary shareholders'
equity:
Ordinary
shares......... 1,000 -- 78 23 74 (175) 1,000
Paid-in capital.. -- 17,000 6,922 9,077 456,433 (489,432) --
Retained earnings
(deficit)...... (185) (603) 486 838 9,996 (10,717) (185)
Cumulative
foreign
translation
adjustment..... 1,358 -- 1,347 78 1,765 (3,190) 1,358
------------- ------------- ------------ ------------- -------------- ------------- -------------
Total ordinary
shareholders'
equity........ 2,173 16,397 8,833 10,016 486,268 (503,514) 2,173
------------- ------------- ------------ ------------- -------------- ------------- -------------
$ 119,866 $146,219 $ 34,058 $ 41,486 $ 601,375 $ (615,711) $ 327,293
--------------- ------------- ------------ ------------- -------------- ------------- -----------
--------------- ------------- ------------ ------------- -------------- ------------- -----------
</TABLE>
<PAGE>
INTRODUCTION
The Company employed the purchase method of accounting for the Acquisition
completed in September, 1996. As a result of the required purchase
accounting adjustments, the post-Acquisition financial statements for the
period from September 25, 1996 to March 29, 1997 ("Successor")
are not comparable to the financial statements for the periods prior to the
Acquisition ("Predecessor").
RESULTS OF OPERATIONS
The following table sets forth the Company's Statement of Earnings Data
expressed as a percentage of net sales:
<TABLE>
<CAPTION>
QUARTER ENDED
------------------------------------
MARCH 29, 1997 MARCH 31, 1996
------------------------------------
<S> <C> <C>
Statement of Earnings Data:
Net sales.................................................... 100.0% 100.0%
Costs and expenses:
Cost of goods sold......................................... 80.1 83.9
Selling and general........................................ 9.3 9.2
Depreciation and amortization.............................. 2.3 2.2
----- -----
Earnings from operations.................................. 8.3 4.7
Interest expense, net........................................ 4.9 0.1
Other expense, net........................................... 0.0 0.1
----- -----
Earnings before income taxes.............................. 3.4 4.5
Provision for income taxes................................... 1.1 1.7
----- -----
Net earnings................................................. 2.3% 2.8%
----- -----
----- -----
</TABLE>
Quarter Ended March 29, 1997 as Compared to Quarter Ended March 31, 1996
Net Sales. Net sales increased 3.1% to $114.9 million for the quarter
ended March 29, 1997 from $111.4 million for the quarter ended March 31,
1996. This increase is primarily attributable to an increase in steel
shipments to producers of manufactured homes and an increase in aluminum
shipments to OEM markets in Europe. These volume increases combined for an
$8.6 million net sales increase compared to net sales in the quarter ended
March 31, 1996. Net sales also increased approximately $1.6 million due to
weakening of the Pound Sterling compared to the U.S Dollar. These increases
were partially offset by a (i) strengthening of the Dutch Guilder compared to
the U.S. Dollar which reduced net sales approximately $2.4 million, and (ii)
lower aluminum selling prices precipitated by an approximate 10% reduction in
market prices for bar aluminum sheet. Net sales in the U.S. increased 4.2% to
$64.5 million for the quarter ended March 29, 1997 from $61.9 million for the
quarter ended March 31, 1996. Net sales in Europe increased 1.8% to $50.4
million for the quarter ended March 29, 1997 from $49.5 million for the
quarter ended March 31, 1996.
Cost of Goods Sold. Cost of goods sold, as a percentage of net sales,
decreased 3.8% for the three months ended March 29, 1997 from 83.9% in 1996
to 80.1% in 1997. This decrease is primarily attributable to (i) lower raw
material prices, which declined more rapidly than selling prices, (ii) sales
of a greater percentage of margin aluminum products, and (iii) an overall
improvement in gross margin attributable to higher sales volume.
Selling, General and Administrative Expenses. Selling, general and
administrative expenses, as a percentage of net sales, for the three months
ended March 29, 1997, approximated prior year expenses for the three months
ended March 31, 1996.
Depreciation and amortization. Depreciation and amortization increased
11.7% to $2.7 million in the quarter ended March 29, 1997 from $2.4 million
in the quarter ended March 31, 1996. This increase was attributable to
approximately $350,000 in amortization of goodwill in the quarter ended March
29, 1997 and depreciation on $13.7 million of capital expenditures made in
the nine months ended December 27, 1996. Such capital expenditures included
approximately $2.0 million for a fabrication facility in Helena, Arkansas and
$1.4 million for certain paintline upgrades in Holland and the U.K.
Earnings from operations. For reasons stated above, earnings from
operations in the U.S. increased from a loss of $169,000 in the first quarter
of 1996 to $1.7 million in the first quarter of 1997. Earnings from
operations in Europe increased 41.5% to $7.8 million for the three months
ended March 29, 1997 from $5.5 million for the three months ended March 31,
1996.
Interest expense, net. Net interest expense in the three months ended
March 29, 1997 increased substantially to $5.6 million from a level of
$157,000 for the three months ended March 31, 1996. This increase was
attributable to interest as a result of the Acquisition debt incurred.
Other expenses, net. Other expenses were not significant in either
periods ended March 29, 1997 or March 31, 1996.
Provision for income taxes. The effective rate for the provision for
income taxes decreased from 38.0% to 32.3% for the three months
ended March 31, 1996 and March 29, 1997, respectively. This decrease was due
to a decline in the earnings of the U.S. operations in the first
quarter of 1997 compared to 1996 levels, partially offset by higher earnings
attributable to the European operations. Earnings in the U.S. are subjected
to slightly higher income tax rates than in the European countries, and are
also subject to state income taxes.
<PAGE>
Part II -- OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Financial Data Schedule
(b) Reports on Form 8-K
None
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, Euramax International plc has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
EURAMAX INTERNATIONAL plc
Signature Title
--------- -----
By /s/ J. David Smith
___________________________ Chief Executive Officer and President
J. David Smith
Dated: May 12, 1997
___________________________
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS
REPORT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS ON BEHALF OF EURAMAX
INTERNATIONAL PLC AND IN THE CAPACITIES AND ON THE DATED INDICATED.
<TABLE>
<S> <C> <C>
/s/ J. David Smith
- ------------------------------------------ Chief Executive Officer, President and Director May 12, 1997
J. David Smith
/s/ R. Scott Vansant
- ------------------------------------------ V.P. Finance and Administration and Secretary May 12, 1997
R. Scott Vansant (Principal Financial and Accounting Officer)
/s/ Richard M. Cashin
- ------------------------------------------ Director May 12, 1997
Richard M. Cashin
/s/ Joseph M. Silvestri
- ------------------------------------------ Director May 12, 1997
Joseph M. Silvestri
- ------------------------------------------ Director May , 1997
William Ty Comfort
/s/ Rolly Van Rappard
- ------------------------------------------ Director May 12, 1997
Rolly Van Rappard
/s/ Paul E. Drack
- ------------------------------------------ Director May 12, 1997
Paul E. Drack
- ------------------------------------------ Director May , 1997
Stuart M. Wallis
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-26-1997
<PERIOD-START> DEC-28-1996
<PERIOD-END> MAR-29-1997
<CASH> 11,572
<SECURITIES> 0
<RECEIVABLES> 77,678
<ALLOWANCES> 3,393
<INVENTORY> 82,102
<CURRENT-ASSETS> 171,317
<PP&E> 110,753
<DEPRECIATION> 4,942
<TOTAL-ASSETS> 334,978
<CURRENT-LIABILITIES> 71,464
<BONDS> 135,000
0
36,423
<COMMON> 1,000
<OTHER-SE> 2,835
<TOTAL-LIABILITY-AND-EQUITY> 334,978
<SALES> 114,874
<TOTAL-REVENUES> 114,874
<CGS> 92,036
<TOTAL-COSTS> 92,036
<OTHER-EXPENSES> 10,679
<LOSS-PROVISION> 167
<INTEREST-EXPENSE> 5,618
<INCOME-PRETAX> 3,846
<INCOME-TAX> 1,241
<INCOME-CONTINUING> 2,605
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,372
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
