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EURAMAX INTERNATIONAL PLC
10-Q, 2000-08-10
ROLLING DRAWING & EXTRUDING OF NONFERROUS METALS

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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 June 30, 2000
		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 333-05978

EURAMAX INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)

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 August 10, 2000, Registrant had outstanding 45,567,312 shares of Class A common stock and 4,434,680 shares of Class B common stock.

Page 1 of 31
Exhibit Index located on page 27

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Part I—Financial Information

Item 1. Financial Statements

Euramax International, Inc. and Subsidiaries
Condensed Consolidated Statements of Earnings
(Thousands of U.S. Dollars)
(Unaudited)

				Quarters ended						Six months ended
				June 30, 2000			June 26, 1999			June 30, 2000			June 26, 1999
Net sales				$	163,715		$	156,199		$	305,988		$	288,586
Costs and expenses:
	Cost of goods sold				132,076			123,934			248,903			231,724
	Selling and general				13,925			14,189			27,704			27,361
	Depreciation and amortization				4,301			3,437			8,059			6,827
		Earnings from operations			13,413			14,639			21,322			22,674
Interest expense, net					(6,760	)		(5,373	)		(12,198	)		(10,631	)
Other expenses, net					(538	)		(223	)		(651	)		(802	)
		Earnings before income taxes			6,115			9,043			8,473			11,241
Provision for income taxes					2,679			3,812			3,687			4,772
		Net earnings			3,436			5,231			4,786			6,469
Dividends on redeemable preference shares					—			1,678			—			3,300
Net earnings available for ordinary shareholders				$	3,436		$	3,553		$	4,786		$	3,169

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Euramax International, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(Thousands of U.S. Dollars)
(Unaudited)

				June 30, 2000			December 31, 1999
ASSETS
Current assets:
	Cash and equivalents			$	19,781		$	13,385
	Accounts receivable, net				99,013			80,087
	Inventories				92,673			82,499
	Other current assets				4,504			4,271
		Total current assets			215,971			180,242
Property, plant and equipment, net					121,994			120,409
Goodwill, net					117,385			82,587
Deferred income taxes					6,617			6,638
Other assets					12,793			9,783
				$	474,760		$	399,659
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
	Cash overdrafts			$	2,497		$	2,009
	Accounts payable				65,065			49,682
	Accrued expenses and other current liabilities				28,377			31,745
	Current maturities of long-term debt				5,352			6,236
		Total current liabilities			101,291			89,672
Long-term debt, less current maturities					277,779			215,043
Deferred income taxes					20,764			20,689
Other liabilities					8,025			9,187
		Total liabilities			407,859			334,591
Shareholders' equity:
	Common stock				500			500
	Additional paid-in capital				53,220			53,220
	Treasury stock				(1,581	)		—
	Retained earnings				21,311			16,525
	Accumulated other comprehensive loss				(6,549	)		(5,177	)
		Total shareholders' equity			66,901			65,068
				$	474,760		$	399,659

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Euramax International, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Thousands of U.S. Dollars)
(Unaudited)

				Six months ended
				June 30, 2000			June 26, 1999
Net cash (used in)/provided by operating activities				$	(9,030	)	$	7,353
Cash flows from investing activities:
	Purchases of businesses				(45,550	)		(22,714	)
	Proceeds from sales of assets				45			588
	Capital expenditures				(5,231	)		(6,049	)
		Net cash used in investing activities			(50,736	)		(28,175	)
Cash flows from financing activities:
	Repayment of debt				(14,025	)		(19,255	)
	Proceeds from debt				77,881			33,700
	Purchase of treasury stock				(1,581	)		—
	Change in cash overdrafts				488			1,509
		Net cash provided by financing activities			62,763			15,954
Effect of exchange rate changes on cash					3,399			2,169
Net increase/(decrease) in cash and equivalents					6,396			(2,699	)
Cash and equivalents at beginning of period					13,385			19,044
Cash and equivalents at end of period				$	19,781		$	16,345
Non-cash investing and financing activities:
	Payables for certain non-compete agreements and working capital adjustments associated with purchases of businesses			$	—		$	877
	Dividends on redeemable preference shares			$	—		$	3,300

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Euramax International, Inc. 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, Inc. ("Euramax") 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 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 operations, 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 Annual Report on Form 10-K for the year ended December 31, 1999. Operating results for the period ended June 30, 2000, are not necessarily indicative of future results that may be expected for the year ending December 29, 2000.

    Certain 1999 amounts have been reclassified to conform to current year presentation.

2. Acquisitions:

    On April 10, 2000, the Company, through its wholly owned subsidiary Amerimax Home Products, Inc., acquired substantially all of the assets and assumed certain liabilities of Gutter World, Inc. and Global Expanded Metals, Inc., companies under common control, ("Gutter World" and "Global", respectively). The purchase price, including approximately $345.0 thousand in acquisition-related fees and expenses, was approximately $45.6 million in cash. Gutter World is a manufacturer of raincarrying accessories, such as gutter guards, water diverters and downspout strainers, as well as door guards. Global manufactures expanded metal products.

    The following unaudited pro forma data present the results of operations for the six months ended June 30, 2000 and June 26, 1999, as though the acquisition had been completed January 1, 2000 and January 1, 1999, respectively, and assume that there are no other changes in the operations of the Company. Such pro forma information includes adjustments to interest expense; changes in depreciation of property, plant and equipment and amortization of goodwill relating to the allocation of the purchase price; elimination of the effect of transactions between Gutter World and a Euramax subsidiary and between Gutter World and Global; and the income tax effect related to these items. The pro forma results are not necessarily indicative of the financial results that might have occurred had the acquisition actually taken place on the above-mentioned dates, or of the future results of operations:

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3. Summary of Significant Accounting Policies:

    For information regarding significant accounting policies, see Note 2 to the Consolidated Financial Statements of the Company for the year ended December 31, 1999, set forth in the Company's Annual Report on Form 10-K.

    In June 1998, the Financial Accounting Standards Board ("FASB") issued SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities. SFAS 133 is effective for all fiscal quarters of all fiscal years beginning after June 15, 2000 (January 1, 2001 for the Company). SFAS 133 requires that all derivative instruments be recorded on the balance sheet at their fair value. Changes in the fair value of derivatives are recorded each period in current earnings or other comprehensive income, depending on whether a derivative is designated as part of a hedge transaction and, if it is, the type of hedge transaction. For fair-value hedge transactions in which the Company is hedging changes in the fair value of an asset, liability, or firm commitment, changes in the fair value of the derivative instrument will generally be offset in the income statement by changes in the hedged item's fair value. For cash-flow hedge transactions, in which the Company is hedging the variability of cash flows related to a variable-rate asset, liability, or a forecasted transaction, changes in the fair value of the derivative instrument will be reported in other comprehensive income. The gains and losses on the derivative instrument that are reported in other comprehensive income will be reclassified as earnings in the periods in which earnings are impacted by the variability of the cash flows of the hedged item. The ineffective portion of all hedges will be recognized in current-period earnings. Management is currently reviewing the provisions of SFAS No. 133 and does not believe that the Company's financial statements will be materially impacted by the adoption.

    In December 1999, the staff of the Securities and Exchange Commission issued Staff Accounting Bulletin ("SAB") 101, "Revenue Recognition in Financial Statements." SAB 101 outlines the basic criteria for revenue recognition and related disclosures. SAB 101 is effective beginning in the fourth quarter of 2000. Management is currently reviewing the guidance provided by SAB 101 and does not believe the Company's financial statements will be materially impacted.

4. Inventories:

    Inventories were comprised of:

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5. Long-Term Obligations:

    Long-term obligations consisted of the following:

    Effective April 10, 2000, the Company amended its Credit Agreement to, among other items, permit the acquisition of Gutter World and Global; provide an additional term loan of $40.0 million; and permanently waive the 1999 Excess Cash Flow payment provision (as defined in the Credit Agreement).

6. Commitments and Contingencies:

Litigation

    The Company is subject to legal proceedings and claims that have arisen in the ordinary course of business. Although occasional adverse decisions or settlements may occur, it is the opinion of the Company's management, based upon information available at this time, that the expected outcome of these matters, individually or in the aggregate, would not reasonably be expected to have a material adverse effect on the consolidated financial position, results of operations or cash flows of the Company and its subsidiaries taken as a whole.

Environmental Matters

    The Company's operations are subject to federal, state, local and European environmental laws and regulations concerning the management of pollution and hazardous substances.

    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,

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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 of the Company from Alumax Inc. (acquired by Aluminum Company of America in May 1998, and hereafter referred to as "Alumax") on September 25, 1996, 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.

7. Comprehensive Income:

    For the six months ended June 30, 2000 and June 26, 1999, comprehensive income was approximately $3.4 million and $3.1 million, respectively. Other comprehensive income refers to revenue, expenses, gains and losses that are reflected in stockholders' equity but excluded from net earnings. For the Company, the components of other comprehensive income are principally foreign currency translation adjustments and minimum pension liability adjustments. For the six months ended June 30, 2000 and June 26, 1999, other comprehensive loss, net of tax, was approximately $(1.4) million and $(3.4) million, respectively.

8. Segment Information:

    For detailed information regarding the Company's reportable segments, see Note 13 to the Consolidated Financial Statements of the Company for the year ended December 31, 1999, set forth in the Company's Annual Report on Form 10-K. The table below presents information about reported segments for the quarters ended June 30, 2000 and June 26, 1999.

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    A reconciliation of total segment sales to total consolidated sales and of total segment EBITDA to total consolidated earnings before income taxes, for the quarters and six months ended June 30, 2000 and June 26, 1999, is as follows:

				Quarter ended June 30, 2000			Quarter ended June 26, 1999			Six months ended June 30, 2000			Six months ended June 26, 1999
Sales
Total segment sales				$	164,355		$	156,624		$	307,566		$	289,918
Eliminations					(640	)		(425	)		(1,578	)		(1,332	)
	Consolidated net sales			$	163,715		$	156,199		$	305,988		$	288,586
EBITDA
Total EBITDA for reportable segments				$	18,917		$	18,934		$	31,663		$	31,101
Expenses that are not segment specific					(1,741	)		(1,081	)		(2,933	)		(2,402	)
Depreciation and amortization					(4,301	)		(3,437	)		(8,059	)		(6,827	)
Interest expense, net					(6,760	)		(5,373	)		(12,198	)		(10,631	)
	Consolidated earnings before income taxes			$	6,115		$	9,043		$	8,473		$	11,241

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    The following table reflects revenues from external customers by groups of similar products for the quarters ended June 30, 2000 and June 26, 1999:

				Quarters ended						Six months ended
Customers/Markets		Primary Products		June 30, 2000			June 26, 1999			June 30, 2000			June 26, 1999
Original Equipment Manufacturers ("OEMs")		Painted aluminum sheet and coil; fabricated painted aluminum, laminated and fiberglass panels; RV doors, windows and roofing; and composite building panels		$	72,927		$	70,114		$	146,026		$	137,366
Rural Contractors		Steel and aluminum roofing and siding			31,498			31,772			53,842			54,543
Home Centers		Raincarrying systems, roofing accessories, windows, doors, and shower enclosures			24,549			23,205			42,285			38,959
Manufactured Housing		Steel siding and trim components			9,596			12,591			20,371			24,241
Distributors		Metal coils, raincarrying systems and roofing accessories			10,514			7,223			16,342			12,121
Industrial and Architectural Contractors		Standing seam panels and siding and roofing accessories			4,791			4,289			9,682			8,658
Home Improvement Contractors		Vinyl replacement windows; metal coils, raincarrying systems and roofing accessories; metal roofing and insulated roofing panels; shower, patio and entrance doors; and awnings			9,840			7,005			17,440			12,698
				$	163,715		$	156,199		$	305,988		$	288,586

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9. Supplemental Condensed Combined Financial Statements:

    On September 25, 1996, Euramax purchased the Company from Alumax. The acquisition was financed, in part, through Senior Subordinated Notes due 2006 (the "Notes"). Euramax International Limited, Euramax European Holdings Limited and Euramax European Holdings B.V. are co-obligors under the Notes (the "Co-Obligors"). Euramax International, Inc. has provided a full and unconditional guarantee of the Notes ("Parent Guarantor"). In addition, Amerimax Holdings, Inc., Amerimax Fabricated Products, Inc., Euramax International Holdings Limited and Euramax Continental Limited, holding company subsidiaries of Euramax, have provided full and unconditional guarantees of the Notes (collectively, the "Guarantor Subsidiaries"). The following supplemental condensed combining financial statements as of June 30, 2000 and December 31, 1999, and for the quarters and six months ended June 30, 2000 and June 26, 1999, reflect the financial position, results of operations, and cash flows of each of the Parent Guarantor, the Co-Obligors, and such combined information of the Guarantor Subsidiaries and the non-guarantor subsidiaries, principally the operating subsidiaries, (collectively, the "Non-Guarantor Subsidiaries"). The Co-Obligors and Guarantors 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 Guarantor are not presented because management has determined that they are not material to investors.

			Quarter ended June 30, 2000
			Euramax International, Inc. (Parent Guarantor)			Euramax International Limited (Co-Obligor)			Euramax European Holdings Limited (Co-Obligor)			Euramax European Holdings B.V. (Co-Obligor)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Totals
Net sales			$	—		$	—		$	—		$	—		$	—		$	163,715		$	—		$	163,715
Costs and expenses:
	Cost of goods sold			—			—			—			—			—			132,076			—			132,076
	Selling and general			907			219			—			—			69			12,730			—			13,925
	Depreciation and amortization			—			—			—			—			91			4,210			—			4,301
	Earnings (loss) from operations			(907	)		(219	)		—			—			(160	)		14,699			—			13,413
Equity in earnings of subsidiaries				4,397			1,880			463			2,505			7,783			—			(17,028	)		—
Interest expense, net				(375	)		(26	)		(103	)		(140	)		(725	)		(5,391	)		—			(6,760	)
Other income (expense), net				—			(9	)		(1,296	)		(59	)		(131	)		957			—			(538	)
	Earnings (loss) before income taxes			3,115			1,626			(936	)		2,306			6,767			10,265			(17,028	)		6,115
Provision (benefit) for income taxes				(319	)		(46	)		(413	)		(62	)		3			3,516			—			2,679
	Net earnings (loss)		$	3,434		$	1,672		$	(523	)	$	2,368		$	6,764		$	6,749		$	(17,028	)	$	3,436

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			Quarter ended June 26, 1999
			Euramax International, Inc. (Parent Guarantor)			Euramax International Limited (Co-Obligor)			Euramax European Holdings Limited (Co-Obligor)			Euramax European Holdings B.V. (Co-Obligor)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Totals
Net sales			$	—		$	—		$	—		$	—		$	—		$	156,199		$	—-		$	156,199
Costs and expenses:
	Cost of goods sold			—			—			—			—			—			123,934			—			123,934
	Selling and general			—			682			—			1			134			13,372			—			14,189
	Depreciation and amortization			—			—			—			—			18			3,419			—			3,437
	Earnings (loss) from operations			—			(682	)		—			(1	)		(152	)		15,474			—			14,639
Equity in earnings of subsidiaries				—			5,708			961			2,786			3,323			—			(12,778	)		—
Interest income (expense), net				—			—			257			(118	)		(27	)		(5,485	)		—			(5,373	)
Other income (expense), net				—			(3	)		(632	)		(1,200	)		(1	)		1,613			—			(223	)
	Earnings before income taxes			—			5,023			586			1,467			3,143			11,602			(12,778	)		9,043
Provision (benefit) for income taxes				—			(208	)		(97	)		(270	)		(52	)		4,439			—			3,812
	Net earnings			—			5,231			683			1,737			3,195			7,163			(12,778	)		5,231
Dividends on redeemable preference shares				—			1,678			—			—			—			—			—			1,678
	Net earnings available for ordinary shareholders		$	—		$	3,553		$	683		$	1,737		$	3,195		$	7,163		$	(12,778	)	$	3,553

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			Six months ended June 30, 2000
			Euramax International, Inc. (Parent Guarantor)			Euramax International Limited (Co-Obligor)			Euramax European Holdings Limited (Co-Obligor)			Euramax European Holdings B.V. (Co-Obligor)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Totals
Net sales			$	—		$	—		$	—		$	—		$	—		$	305,988		$	—		$	305,988
Costs and expenses:
	Cost of goods sold			—			—			—			—			—			248,903			—			248,903
	Selling and general			1,706			241			—			—			309			25,448			—			27,704
	Depreciation and amortization			—			—			—			—			181			7,878			—			8,059
	Earnings (loss) from operations			(1,706	)		(241	)		—			—			(490	)		23,759			—			21,322
Equity in earnings of subsidiaries				6,464			4,568			1,306			6,003			11,768			—			(30,109	)		—
Interest expense, net				(751	)		(50	)		(200	)		(175	)		(113	)		(10,909	)		—			(12,198	)
Other income (expense), net				—			(9	)		(1,729	)		(2,107	)		(44	)		3,238			—			(651	)
	Earnings (loss) before income taxes			4,007			4,268			(623	)		3,721			11,121			16,088			(30,109	)		8,473
Provision (benefit) for income taxes				(777	)		(55	)		(565	)		(783	)		154			5,713			—			3,687
	Net earnings (loss)		$	4,784		$	4,323		$	(58	)	$	4,504		$	10,967		$	10,375		$	(30,109	)	$	4,786

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			Six months ended June 26, 1999
			Euramax International, Inc. (Parent Guarantor)			Euramax International Limited (Co-Obligor)			Euramax European Holdings Limited (Co-Obligor)			Euramax European Holdings B.V. (Co-Obligor)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Totals
Net sales			$	—		$	—		$	—		$	—		$	—		$	288,586		$	—		$	288,586
Costs and expenses:
	Cost of goods sold			—			—			—			—			—			231,724			—			231,724
	Selling and general			—			1,421			—			2			72			25,866			—			27,361
	Depreciation and amortization			—			—			—			—			35			6,792			—			6,827
	Earnings (loss) from operations			—			(1,421	)		—			(2	)		(107	)		24,204			—			22,674
Equity in earnings of subsidiaries				—			7,452			1,663			5,810			3,683			—			(18,608	)		—
Interest income (expense), net				—			—			133			(133	)		(4	)		(10,627	)		—			(10,631	)
Other income (expense), net				—			(3	)		(1,480	)		(4,153	)		(24	)		4,858			—			(802	)
	Earnings before income taxes			—			6,028			316			1,522			3,548			18,435			(18,608	)		11,241
Provision (benefit) for income taxes				—			(441	)		(416	)		(1,482	)		(34	)		7,145			—			4,772
	Net earnings			—			6,469			732			3,004			3,582			11,290			(18,608	)		6,469
Dividends on redeemable preference shares				—			3,300			—			—			—			—			—			3,300
	Net earnings available for ordinary shareholders		$	—		$	3,169		$	732		$	3,004		$	3,582		$	11,290		$	(18,608	)	$	3,169

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				As of June 30, 2000
				Euramax International, Inc. (Parent Guarantor)			Euramax International Limited (Co-Obligor)			Euramax European Holdings Limited (Co-Obligor)			Euramax European Holdings B.V. (Co-Obligor)			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated Totals
ASSETS
Current assets:
	Cash and equivalents			$	—		$	—		$	—		$	—		$	437		$	19,344		$	—		$	19,781
	Accounts receivable, net				1			108			—			—			18			98,886			—			99,013
	Inventories				—			—			—			—			—			92,673			—			92,673
	Other current assets				—			—			—			—			2,260			2,244			—			4,504
		Total current assets			1			108			—			—			2,715			213,147			—			215,971
Property, plant and equipment, net					—			—			—			—			150			121,844			—			121,994
Amounts due from parent/affiliates					80,790			75,375			45,497			44,679			344,921			119,027			(710,289	)		—
Goodwill, net					—			—			—			—			8,225			109,160			—			117,385
Investment in consolidated subsidiaries					123,005			21,540			(8,924	)		22,431			152,989			—			(311,041	)		—
Deferred income taxes					—			—			—			—			—			6,617			—			6,617
Other assets					—			2,099			552			577			1,361			8,204			—			12,793
				$	203,796		$	99,122		$	37,125		$	67,687		$	510,361		$	577,999		$	(1,021,330	)	$	474,760
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
	Cash overdrafts			$	—		$	—		$	—		$	—		$	(2,423	)	$	4,920		$	—		$	2,497
	Accounts payable				—			—			—			—			43			65,022			—			65,065
	Accrued expenses and other current liabilities				(1,119	)		(2,377	)		(1,104	)		6,908			(333	)		26,402			—			28,377
	Current maturities of long- term debt				—			—			—			—			2,974			2,378			—			5,352
		Total current liabilities			(1,119	)		(2,377	)		(1,104	)		6,908			261			98,722			—			101,291
Long-term debt, less current maturities					—			70,605			27,179			37,216			115,901			26,878			—			277,779
Amounts due to parent/affiliates					135,811			15,166			13,200			1,117			248,923			296,072			(710,289	)		—
Deferred income taxes					2,203			421			—			—			(474	)		18,614			—			20,764
		Other liabilities			—			—			—			—			945			7,080			—			8,025
		Total liabilities			136,895			83,815			39,275			45,241			365,556			447,366			(710,289	)		407,859
Shareholders' equity:
	Common stock				500			2			78			23			35,001			4,984			(40,088	)		500
	Additional paid-in capital				65,218			20,726			6,922			9,077			174,855			159,426			(383,004	)		53,220
	Treasury stock				(1,581	)		—			—			—			—			—			—			(1,581	)
	Retained earnings (deficit)				4,522			317			(8,820	)		17,662			(63,008	)		(29,461	)		100,099			21,311
	Accumulated other comprehensive loss				(1,758	)		(5,738	)		(330	)		(4,316	)		(2,043	)		(4,316	)		11,952			(6,549	)
		Total shareholders' equity			66,901			15,307			(2,150	)		22,446			144,805			130,633			(311,041	)		66,901
				$	203,796		$	99,122		$	37,125		$	67,687		$	510,361		$	577,999		$	(1,021,330	)	$	474,760

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				As of December 31, 1999
				Euramax International, Inc. (Parent Guarantor)			Euramax International Limited (Co-Obligor)			Euramax European Holdings Limited (Co-Obligor)			Euramax European Holdings B.V. (Co-Obligor)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Totals
ASSETS
Current assets:
	Cash and equivalents			$	—		$	—		$	—		$	—		$	1,537		$	11,848		$	—		$	13,385
	Accounts receivable, net				—			103			—			—			1,354			78,630			—			80,087
	Inventories				—			—			—			—			2,622			79,877			—			82,499
	Other current assets				—			—			—			—			1,467			2,804			—			4,271
		Total current assets			—			103			—			—			6,980			173,159			—			180,242
Property, plant and equipment, net					—			—			—			—			5,603			114,806						120,409
Amounts due from parent/affiliates					76,535			81,757			46,846			49,743			345,507			141,423			(741,811	)		—
Goodwill, net					—			—			—			—			8,368			74,219			—			82,587
Investment in consolidated subsidiaries					117,490			17,918			(10,829	)		17,360			98,088			—			(240,027	)		—
Deferred income taxes					—			—			—			—			—			6,638			—			6,638
Other assets					—			2,267			635			658			1,691			4,532			—			9,783
				$	194,025		$	102,045		$	36,652		$	67,761		$	466,237		$	514,777		$	(981,838	)	$	399,659
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
	Cash overdrafts			$	—		$	—		$	—		$	—		$	(2,030	)	$	4,039		$	—		$	2,009
	Accounts payable				2			—			—			—			230			49,450			—			49,682
	Accrued expenses and other current liabilities				(340	)		(772	)		(595	)		4,095			1,316			28,041			—			31,745
	Current maturities of long- term debt				—			—			—			—			5,540			696			—			6,236
		Total current liabilities			(338	)		(772	)		(595	)		4,095			5,056			82,226			—			89,672
Long-term debt, less current maturities					—			70,605			27,179			37,216			45,568			34,475			—			215,043
Amounts due to parent/affiliates					126,739			19,861			12,275			7,571			279,293			296,072			(741,811	)		—
Deferred income taxes					2,203			421			—			—			(374	)		18,439			—			20,689
Other liabilities					—			—			—			—			1,021			8,166			—			9,187
		Total liabilities			128,604			90,115			38,859			48,882			330,564			439,378			(741,811	)		334,591
Shareholders' equity:
	Common stock				500			2			78			23			35,001			4,983			(40,087	)		500
	Additional paid-in capital				65,218			20,726			6,922			9,077			174,855			114,412			(337,990	)		53,220
	Retained earnings (deficit)				(262	)		16,787			4,170			20,049			(46,325	)		(14,760	)		36,866			16,525
	Dividends declared				—			(20,793	)		(12,932	)		(6,891	)		(27,650	)		(25,076	)		93,342			—
	Accumulated other comprehensive loss				(35	)		(4,792	)		(445	)		(3,379	)		(208	)		(4,160	)		7,842			(5,177	)
		Total shareholders' equity			65,421			11,930			(2,207	)		18,879			135,673			75,399			(240,027	)		65,068
				$	194,025		$	102,045		$	36,652		$	67,761		$	466,237		$	514,777		$	(981,838	)	$	399,659

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				Six months ended June 30, 2000
				Euramax International, Inc. (Parent Guarantor)			Euramax International Limited (Co-obligor)			Euramax European Holdings Limited (Co-obligor)			Euramax European Holdings B.V. (Co-obligor)			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidated Totals
Net cash (used in) provided by Operating activities				$	(2,462	)	$	(1,687	)	$	(1,882	)	$	1,592		$	6,350		$	(10,941	)	$	(9,030	)
Cash flows from investing activities:
	Purchase of business																			(45,550	)		(45,550	)
	Proceeds from sales of assets				—			—			—			—			—			45			45
	Capital expenditures				—			—			—			—			(28	)		(5,203	)		(5,231	)
		Net cash used in investing activities			—			—			—			—			(28	)		(50,708	)		(50,736	)
Cash flows from financing activities:
	Repayment of debt				—			—			—			—			(3,233	)		(10,792	)		(14,025	)
	Proceeds from debt				—			—			—			—			71,000			6,881			77,881
	Purchase of treasury stock				(1,581	)		—			—			—			—			—			(1,581	)
	Changes in cash overdrafts				—			—			—			—			(392	)		880			488
	Due to/from parent or affiliate				4,043			1,687			2,274			(1,390	)		(74,797	)		68,183			—
		Net cash provided by (used in) financing activities			2,462			1,687			2,274			(1,390	)		(7,422	)		65,152			62,763
	Effect of exchange rate changes on cash				—			—			(392	)		(202	)		—			3,993			3,399
	Net increase (decrease) in cash and equivalents				—			—			—			—			(1,100	)		7,496			6,396
	Cash and equivalents at beginning of period				—			—			—			—			1,537			11,848			13,385
	Cash and equivalents at end of period			$	—		$	—		$	—		$	—		$	437		$	19,344		$	19,781

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				Six months ended June 26, 1999
				Euramax International, Inc. (Parent Guarantor)			Euramax International Limited (Co-obligor)			Euramax European Holdings Limited (Co-obligor)			Euramax European Holdings B.V. (Co-obligor)			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidated Totals
Net cash (used in) provided by Operating activities				$	—		$	(981	)	$	(1,294	)	$	1,568		$	(2,357	)	$	10,417		$	7,353
Cash flows from investing activities:
	Purchases of businesses				—			—			—			—			(16,158	)		(6,556	)		(22,714	)
	Proceeds from sales of assets				—			—			—			—			1			587			588
	Capital expenditures				—			—			—			—			(39	)		(6,010	)		(6,049	)
		Net cash used in investing activities			—			—			—			—			(16,196	)		(11,979	)		(28,175	)
Cash flows from financing activities:
	Repayment of debt				—			—			—			—			(7,483	)		(11,772	)		(19,255	)
	Proceeds from debt				—			—			—			—			30,000			3,700			33,700
	Changes in cash overdrafts				—			—			—			—			2,073			(564	)		1,509
	Due to/from parent or affiliate				—			981			1,648			(1,272	)		(5,981	)		4,624			—
	Net cash provided by (used in) financing activities				—			981			1,648			(1,272	)		18,609			(4,012	)		15,954
	Effect of exchange rate changes on cash				—			—			(354	)		(296	)		—			2,819			2,169
	Net increase (decrease) in cash and equivalents				—			—			—			—			56			(2,755	)		(2,699	)
	Cash and equivalents at beginning of period				—			—			—			—			12			19,032			19,044
	Cash and equivalents at end of period			$	—		$	—		$	—		$	—		$	68		$	16,277		$	16,345

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

Business Overview

    The following discussion should be read in conjunction with the Condensed Consolidated Financial Statements included elsewhere in this document, as well as the year-end Consolidated Financial Statements and Management's Discussion and Analysis included in the Company's Annual Report on Form 10-K for the year ended December 31, 1999.

    The Company is an international producer of value-added aluminum, steel, vinyl and fiberglass fabricated products, with facilities strategically located in the United Kingdom ("U.K."), The Netherlands, France, and all major regions of the continental United States ("U.S."). Euramax's core products include specialty coated coils, aluminum recreational vehicle ("RV") sidewalls, RV doors, farm and agricultural panels, roofing accessories, metal and vinyl raincarrying systems, soffit and fascia systems, and vinyl replacement windows. The Company's customers include original equipment manufacturers ("OEMs") such as RV, commercial panel and transportation industry manufacturers; rural contractors; home centers; manufactured housing producers; distributors; industrial and architectural contractors; and home improvement contractors.

    Effective April 10, 2000, the Company, through its wholly owned subsidiary Amerimax Home Products, Inc., acquired substantially all of the assets and assumed certain liabilities of Gutter World, Inc. ("Gutter World") and Global Expanded Metals, Inc. ("Global"). Gutter World manufactures a variety of raincarrying accessories, including gutter and door guards, water diverters and downspout strainers. Global manufactures expanded metal products.

    The Company expects these acquisitions to increase net sales in its U.S. Fabrication segment, particularly those to home centers and distributors. Consistent with the Company's business strategy, management expects to continue identifying and acquiring businesses that will allow it to expand its customer base, geographic coverage and product offerings.

    Financial results for the six months ended June 30, 2000, compared to the same period of 1999, reflect a higher volume of shipments of aluminum and steel; higher realized selling prices, particularly in Europe; and sales from the April 2000 acquisitions of Gutter World and Global, as well as the June 1999 acquisition of Atlanta Metal Products, Inc. These improvements were offset by lower net sales resulting from the weakening of foreign currencies relative to the U.S. Dollar, and the softening of demand in certain U.S. markets. The net effect of these conditions enabled a 6.0% increase in net sales. Further, higher aluminum costs enabled the Company to increase average selling prices in Europe, contributing to an increase in earnings from operations in Europe, despite weakening of European currencies relative to the U.S. Dollar. Price increases were also obtained in the U.S., although lower levels of demand in rural construction and OEM markets lead to lower U.S. operating earnings. The volatile market for aluminum raw material, together with an anticipated generally slower pace of U.S. business activity, will likely continue to pressure operating margins in the U.S. for the balance of 2000.

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Results of Operations

Quarter Ended June 30, 2000 as Compared to Quarter Ended June 26, 1999

    The following table sets forth the Company's Statements of Earnings Data expressed as a percentage of net sales:

    Net Sales.  Net sales increased 4.8% to $163.7 million for the quarter ended June 30, 2000, from $156.2 million for the quarter ended June 26, 1999. Sales in the U.S. increased principally due to increased sales to home centers, distributors and home improvement contractors resulting primarily from the second quarter acquisitions of Gutter World and Global (see Note 2 to the Condensed Consolidated Finance Statements), as well as the 1999 acquisition of Atlanta Metal Products, Inc., acquired in June, 1999 (see Note 2 to the Consolidated Financial Statements of the Company for the year ended December 31, 1999, set forth in the Company's Annual Report on Form 10-K). These acquisitions contributed approximately $8.0 million to second quarter 2000 sales. These increases were offset by a decline in sales to producers of manufacturing housing due to reduced demand for products resulting, in part, from the producers' overstock of manufactured housing inventory. Further, second quarter 2000 sales to the RV market were higher than in the second quarter of 1999; however, we expect shipments to the RV industry to slow in the second half of the year. The Company's U.S. subsidiaries are included in the U.S. Fabrication Segment (see Note 8 to the Condensed Consolidated Financial Statements).

    Despite a decline in reported net sales of approximately $5.3 million due to the weakening of foreign exchange rates relative to the U.S. Dollar, second quarter net sales in Europe increased by approximately 3.5% over the same period in 1999. Sales in the European Roll Coating Segment (see Note 8 to the Condensed Consolidated Financial Statements) increased primarily from strong demand for specialty coated coil in continental Europe resulting from continued economic improvements in Europe, as well as from higher realized selling prices precipitated by increases in aluminum costs. Offsetting the increases

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within the European Roll Coating Segment were decreases in sales to the U.K. export markets resulting from the continued strength of the Pound Sterling relative to other European currencies.

    Cost of goods sold.  Cost of goods sold, as a percentage of net sales, increased to 80.7% for the quarter ended June 30, 2000, from 79.3% for the quarter ended June 26, 1999. This increase is primarily attributable to an increase in raw material aluminum prices compared to the same period in the prior year.

    Selling and general.  Selling and general expenses, as a percentage of net sales, decreased to 8.5% for the quarter ended June 30, 2000, from 9.1% for the quarter ended June 26, 1999. This decrease is primarily attributable to higher net sales, lower levels of spending on information technology and incentive compensation, and a weakening of foreign exchange rates relative to the U.S. Dollar.

    Depreciation and amortization.  Depreciation and amortization, as a percentage of net sales, was 2.6% for the quarter ended June 30, 2000, compared to 2.2% for the quarter ended June 26, 1999. The increase in depreciation and amortization is primarily the result of acquisitions.

    Earnings from operations.  As noted above, earnings from operations in the U.S. decreased to $8.1 million for the quarter ended June 30, 2000, from $9.1 million for the quarter ended June 26, 1999, and earnings from operations in Europe decreased to $5.3 million for the quarter ended June 30, 2000, from $5.6 million for the quarter ended June 26, 1999. Earnings from operations in the U.S. were more negatively impacted by the higher raw material costs than were earnings in Europe, as, historically, the U.S. operations are not able to pass along raw material price increases as quickly as the European operations. The decrease in earnings from operations in Europe is attributable to the weakening of European currencies relative to the U.S. Dollar, which reduced reported operating earnings by $707.0 thousand compared to the second quarter of 1999.

    Interest expense, net.  Net interest expense, increased to $6.8 million for the quarter ended June 30, 2000, from $5.4 million for the quarter ended June 26, 1999. The increase in interest expense is due to additional borrowings to fund acquisitions, as well as to higher interest rates.

    Other expenses, net.  Other expenses were not significant for the quarters ended June 30, 2000 and June 26, 1999.

    Provision for income taxes.  The income tax provision for the period is based on the effective tax rate expected to be applicable for the full year. The effective rate for the provision for income taxes increased to 43.8% from 42.2% for the quarters ended June 30, 2000 and June 26, 1999, respectively. The slightly higher rate is primarily due to an increase in non-deductible goodwill amortization resulting from the acquisition of Atlanta Metal Products, Inc.

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Six Months Ended June 30, 2000 as Compared to Six Months Ended June 26, 1999

    The following table sets forth the Company's Statements of Earnings Data expressed as a percentage of net sales:

    Net Sales.  Net sales increased 6.0% to $306.0 million for the six months ended June 30, 2000, from $288.6 million for the six months ended June 26, 1999. As reflected in the quarter ended June 30, 2000, compared to the quarter ended June 26, 1999, sales in the U.S. were higher principally due to increased sales to home centers, distributors and home improvement contractors resulting primarily from the second quarter acquisitions of Gutter World and Global, as well as the 1999 acquisition of Atlanta Metal Products, Inc. Increases were also experienced in vinyl window sales to home improvement contractors and sales of roofing accessories to industrial and architectural contractors. These increases were offset by a decline in sales to producers of manufacturing housing. See "Quarter Ended June 30, 2000 as Compared to Quarter Ended June 26, 2000—Net Sales" for further discussion of the factors affecting sales in the U.S., as these factors also apply to the change in net sales for the six months ended June 30, 2000, compared to the six months ended June 26, 1999.

    Despite a decline in reported net sales of approximately $10.1 million due to the weakening of foreign exchange rates relative to the U.S. Dollar, net sales in Europe for the six months ended June 30, 2000, increased by approximately 7.4% over the same period in 1999. Sales in the European Roll Coating Segment increased primarily from the continued strength of the demand for specialty coated coil in continental Europe, as well as from higher realized aluminum selling prices. Offsetting the increases in the European Roll Coating Segment were decreases in sales to the U.K. export markets resulting from the continued strength of the Pound Sterling relative to other European currencies.

    Cost of goods sold.  Cost of goods sold, as a percentage of net sales, increased to 81.3% for the six months ended June 30, 2000, from 80.3% for the six months ended June 26, 1999. This increase is primarily attributable to an increase in raw material aluminum prices compared to the same period in the prior year.

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    Selling and general.  Selling and general expenses, as a percentage of net sales, decreased to 9.1% for the six months ended June 30, 2000, from 9.5% for the six months ended June 26, 1999. This decrease is primarily attributable to higher net sales, lower levels of spending on information technology and incentive compensation, and a weakening of foreign exchange rates relative to the U.S. Dollar.

    Depreciation and amortization.  Depreciation and amortization, as a percentage of net sales, was 2.6% for the six months ended June 30, 2000, compared to 2.4% for the six months ended June 26, 1999. The increase in depreciation and amortization is primarily the result of acquisitions.

    Earnings from operations.  As noted above, earnings from operations in the U.S. decreased to $9.5 million for the six months ended June 30, 2000, from $12.8 million for the six months ended June 26, 1999, and earnings from operations in Europe increased to $11.8 million for the six months ended June 30, 2000, from $9.9 million for the six months ended June 26, 1999. Earnings from operations in the U.S. were more negatively impacted by the higher raw material costs than were earnings in Europe, as, historically, the U.S. operations are not able to pass along raw material price increases as quickly as the European operations. The ability to pass along price increases at a quicker pace in Europe, together with strong European demand, enabled the increase in earnings from operations in Europe. This increase was achieved despite weakening European currencies, which reduced reported operating earnings by $1.4 million compared to the first six months of 1999.

    Interest expense, net.  Net interest expense, increased to $12.2 million for the six months ended June 30, 2000, from $10.6 million for the six months ended June 26, 1999. The increase in interest expense is due to additional borrowings to fund acquisitions, as well as to higher interest rates.

    Other expenses, net.  Other expenses were not significant for the six months ended June 30, 2000 and June 26, 1999.

    Provision for income taxes.  The income tax provision for the period is based on the effective tax rate expected to be applicable for the full year. The effective rate for the provision for income taxes increased to 43.5% from 42.5% for the six months ended June 30, 2000 and June 26, 1999, respectively. The slightly higher rate is primarily due to an increase in non-deductible goodwill amortization resulting from the acquisition of Atlanta Metal Products, Inc.

Liquidity and Capital Resources

    Liquidity.  The Company's primary liquidity needs arise from debt service incurred in connection with acquisitions and the funding of capital expenditures. As of June 30, 2000, the Company had cash of $19.8 million and outstanding indebtedness of $283.1 million, representing an increase of $61.9 million as compared to December 31, 1999. This increase in debt is related to the financing of acquisitions, seasonal borrowing needs of the business and higher aluminum costs. Included in such indebtedness was approximately $148.1 million under the Company's Credit Agreement, consisting of $65.3 million under the Company's Term Loans and $82.8 million under the Company's Revolving Credit Facility. The undrawn amount of the Revolving Credit Facility at June 30, 2000, was approximately $17.2 million, which was available for working capital and general corporate purposes, subject to borrowing base limitations. As of June 30, 2000, this amount was fully available.

    The Company's leveraged financial position requires that a substantial portion of the Company's cash flow from operations be used to pay interest on the Notes, principal and interest under the Company's Credit Agreement and other indebtedness. Significant increases in the floating interest rates on the Term Loans and Revolving Credit Facility would result in increased debt service requirements, which may reduce the funds available for capital expenditures and other operational needs. In addition, the Company's leveraged position may impede its ability to obtain financing in the future for working capital, capital expenditures and general corporate purposes. Further, the Company's leveraged position may make it more vulnerable to economic downturns and may limit its ability to withstand competitive pressures.

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    The Company's primary source of liquidity is funds generated from operations, which are supplemented by borrowings under the Credit Agreement. Net cash used in operating activities for the six months ended June 30, 2000, was $9.0 million, compared to cash provided by operating activities of $7.4 million for the six months ended June 26, 1999. The increase in cash used in operating activities for the six months ended June 30, 2000, compared to the six months ended June 26, 1999, is primarily related to an increase in accounts receivable resulting from higher sales and an increase in inventories due to higher aluminum prices.

    Net cash used in investing activities increased primarily as a result of the acquisitions of Gutter World and Global in the second quarter of 2000 as compared to the acquisition of Atlanta Metal Products during the second quarter of 1999.

    Net cash provided by financing activities increased primarily due to the borrowings under the Credit Agreement which increased approximately $49.4 million to fund the acquisitions of Gutter World and Global, and to fund increased working capital needs of the business during the six months ended June 30, 2000, compared to the six months ended June 26, 1999.

    The Company believes that cash generated from operations and, subject to borrowing base limitations, borrowings under the Company's Credit Agreement will be adequate to meet its needs for the foreseeable future, although no assurance to that effect can be given.

    Capital Expenditures.  The Company's capital expenditures were $5.2 million and $6.0 million for the six months ended June 30, 2000 and June 26, 1999, respectively. Capital expenditures in 2000 include approximately $2.2 million for several projects related to business expansion and cost reduction activities, and approximately $758.0 thousand for improvements to the paintlines in Helena, Arkansas; Roermond, The Netherlands; and Corby, England. Capital expenditures in 1999 included approximately $1.7 million for improvements to the paintline in Corby, England and Helena, Arkansas. The balance of capital expenditures in both periods primarily relate to purchases and upgrades of fabricating equipment, transportation and material moving equipment, and information systems.

    The Company has made and will continue to make capital expenditures to comply with Environmental Laws. The Company estimates that its environmental capital expenditures will be approximately $250.0 thousand in 2000.

    Working Capital Management.  Working capital was $114.7 million as of June 30, 2000, compared to $90.6 million as of December 31, 1999. The increase in working capital is primarily attributable to lower than expected sales to rural construction markets, rising aluminum prices, higher net sales, the acquisitions of Gutter World and Global, and seasonal demands of the business. The Company continues to aggressively manage working capital levels and believes that current levels of working capital represent a liquid source of funds available for future cash flows.

Recent Accounting Pronouncements

    In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 133, Accounting for Derivative Instruments and Hedging Activities. SFAS 133 is effective for all fiscal quarters of all fiscal years beginning after June 15, 2000 (January 1, 2001 for the Company). SFAS 133 requires that all derivative instruments be recorded on the balance sheet at their fair value. Changes in the fair value of derivatives are recorded each period in current earnings or other comprehensive income, depending on whether a derivative is designated as part of a hedge transaction and, if it is, the type of hedge transaction. For fair-value hedge transactions in which the Company is hedging changes in the fair value of an asset, liability, or firm commitment, changes in the fair value of the derivative instrument will generally be offset in the income statement by changes in the hedged item's fair value. For cash-flow hedge transactions, in which the Company is hedging the variability of cash flows related to a variable-rate asset, liability, or a forecasted transaction, changes in the fair value

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of the derivative instrument will be reported in other comprehensive income. The gains and losses on the derivative instrument that are reported in other comprehensive income will be reclassified as earnings in the periods in which earnings are impacted by the variability of the cash flows of the hedged item. The ineffective portion of all hedges will be recognized in current period earnings. Management is currently reviewing the provisions of SFAS No. 133 and does not believe that the Company's financial statements will be materially impacted by the adoption.

    In December 1999, the staff of the Securities and Exchange Commission issued Staff Accounting Bulletin ("SAB") 101, "Revenue Recognition in Financial Statements." SAB 101 outlines the basic criteria for revenue recognition and related disclosures. SAB 101 is effective beginning in the fourth quarter of 2000. Management is currently reviewing the guidance provided by SAB 101 and does not believe the Company's financial statements will be materially impacted.

Environmental Matters

    The Company's exposure to environmental matters has not changed significantly from the year ended December 31, 1999. For detailed information regarding environmental matters, see "Management's Discussion and Analysis—Risk Management" set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 1999.

    Note Regarding Forward-Looking Statements:  The Management's Discussion and Analysis and other sections of this Form 10-Q may contain forward-looking statements that are based on current expectations, estimates and projections about the industries in which the Company operates, and management's beliefs and assumptions. Such forward-looking statements include terminology such as "expects," "anticipates," "intends," "plans," "believes," "estimates," or variations of such words and similar expressions regarding beliefs, plans, expectations or intentions regarding the future. Forward-looking statements in this report include, but are not limited to: (1) statements regarding expected growth in the home center and distributor markets resulting from acquisitions; (2) statements regarding the Company's expectations to continue acquiring businesses that will allow it to expand its customer base, geographic coverage and product offerings; (3) statements regarding the expectation that the volatile market for aluminum raw material, together with an anticipated generally slower pace of U.S. business activity, will likely continue to pressure operating margins in the U.S. for the balance of 2000; (4) statements regarding the expectation that shipments to the RV industry will slow in the second half of the year; and (5) statements regarding the Company's belief that cash from operations and borrowings under the Credit Agreement will be adequate to meet its needs for the foreseeable future. These forward-looking statements are based on a number of assumptions that could ultimately prove inaccurate, and, therefore, there can be no assurance that they will prove to be accurate. All such forward-looking statements are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. Important factors that could cause future financial performance to differ materially and significantly from past results and from those expressed or implied in this document include, without limitation, the risks of acquisition of businesses (including limited knowledge of the businesses acquired and misrepresentations by sellers), changes in business strategy or development plans, the cyclical demand for the Company's products, the supply and/or price of aluminum and other raw materials, currency exchange rate fluctuations, environmental regulations, availability of financing, competition, reliance on key management personnel, ability to manage growth, loss of customers, and a variety of other factors. For further information on these and other risks, see the "Risk Factors" section of Item 1 of the Company's Annual Report on Form 10-K for the year ended December 31, 1999, as well as the Company's other filings with the Securities and Exchange Commission. The Company assumes no obligation to update publicly its forward-looking statements, whether as a result of new information, future events or otherwise.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

    The following discussion about the Company's risk-management activities includes forward-looking statements that involve risk and uncertainties. Actual results could differ materially from those projected in the forward-looking statement. See "Note Regarding Forward Looking Statements" for additional information regarding the Private Securities Litigation Reform Act. The Company's management of market risk from changes in interest rates, exchange rates and commodity prices has not changed from the year ended December 31, 1999. For detailed information regarding the Company's risk management, see "Management's Discussion and Analysis—Risk Management" and "Item 7A. Quantitative and Qualitative Disclosures about Market Risk" set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 1999.

Interest Rate Risk

    This analysis presents the hypothetical loss in fair value and increase in interest expense of those financial instruments and derivative instruments held by the Company at June 30, 2000, which are sensitive to changes in interest rates. All other factors remaining unchanged, a hypothetical 10 percent increase in interest rates would decrease the fair value of the Company's fixed-rate, long-term debt outstanding at June 30, 2000, by approximately $14.3 million, based upon the use of a discounted cash flow model, as compared to a hypothetical decrease in fair value of approximately $7.0 million at December 31, 1999. The hypothetical decrease in the fair value of the Company's fixed-rate, long-term debt is primarily the result of the depressed activity in the high yield bond market during the first half of 2000.

    A hypothetical 10 percent increase in interest rates for one year on the Company's variable rate financial instruments and derivative instruments would increase interest expense by approximately $1.3 million as calculated at June 30, 2000, as compared to a hypothetical increase in interest expense of approximately $580.9 thousand as calculated at December 31, 1999. The hypothetical increase in interest expense is primarily the result of increases in interest rates and an increase in the Company's variable rate debt.

Foreign Currency Exchange Risk

    This analysis presents the hypothetical increase in foreign exchange loss and increase in interest expense related to those financial instruments and derivative instruments held by the Company at June 30, 2000, which are sensitive to changes in foreign currency exchange risks. A hypothetical 10 percent decrease in foreign currency exchange rates would increase the Company's foreign exchange loss by approximately $859.6 thousand for those financial instruments and derivative instruments affected by foreign currency exchange fluctuations, as compared to a hypothetical increase in foreign exchange loss of approximately $822.5 thousand for the year ended December 31, 1999.

    All other factors remaining unchanged, a hypothetical 10 percent increase in foreign currency exchange rates for one year would increase interest expense by approximately $577.9 thousand as calculated at June 30, 2000, for those financial instruments and derivative instruments affected by foreign currency exchange fluctuations, as compared to a hypothetical increase in interest expense of approximately $795.2 thousand as calculated at December 31, 1999. The hypothetical decrease in interest expense is primarily due to the weakening of the Euro and Pound Sterling relative to the U.S. Dollar on the Company's currency swaps.

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Part II—Other Information

Item 6. Exhibits and Reports on Form 8-K

(a)

(1)   The following consolidated financial statements of Euramax International, Inc. and its subsidiaries are included in Part I, Item 1.

Condensed Consolidated Statements of Earnings for the quarters ended June 30, 2000 and June 26, 1999

Condensed Consolidated Balance Sheets at June 30, 2000 and December 31, 1999

Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2000 and June 26, 1999

Notes to Condensed Consolidated Financial Statements

(b)

Reports on Form 8-K: The Company filed a report on Form 8-K dated April 24, 2000, reporting the acquisitions of substantially all of the assets of Gutter World, Inc. and Global Expanded Metals, Inc., and which included the following documents:

(1)

Audited financial Statements of Gutter World, Inc. as of and for the year ended December 31, 1999.

(2)

Audited financial statements of Global Expanded Metals, Inc. as of and for the year ended December 31, 1999

(3)

Pro Forma Financial Information including an unaudited Pro Forma Condensed Combined Balance Sheet of Euramax International, Inc. and Subsidiaries as of December 31, 1999, and an unaudited Pro Forma Condensed Combined Statement of Earnings of Euramax International, Inc. and Subsidiaries for the year ended December 31, 1999, giving effect to the Transaction.

(c)

Exhibits:

2.1**		Purchase Agreement dated as of April 28, 1997, among the Company and Genstar Capital Corporation ("GCC"), Ontario Teachers' Pension Plan Board and the Management Stockholders of Gentek Holdings, Inc. ("Holdings") as sellers GCC as sellers' representative; Holdings and Gentek Building Products, Inc. ("GBPI"). (Incorporated by reference to Exhibit 2.1 of the Registrant's Form 8-K filed August 1, 1997).
2.2******		Proposals for the acquisition of the entire issued share capital of Euramax International Limited by Euramax International, Inc. to be effected by means of a Scheme Arrangement under Section 425 of the Companies Act 1985
2.3********		Purchase Agreement dated as of March 10, 2000, by and between Amerimax Home Products, Inc., Gutter World, Inc. and Global Expanded Metals, Inc., and all of the stockholders of Gutter World, Inc. and Global Expanded Metals, Inc.
3.1*		Articles of Association of Euramax International plc
3.2*		Memorandum and Articles of Association of Euramax European Holdings plc
3.3*		Articles of Association of Euramax International B.V.
3.4*		Articles of Incorporation of Amerimax Holdings, Inc.
3.5*		Bylaws of Amerimax Holdings, Inc.

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4.3*		Indenture, dated as of September 25, 1996, by and among Euramax International plc, Euramax European Holdings plc, Euramax European Holdings B.V., Amerimax Holdings, Inc. and the Chase Manhattan Bank, as Trustee.
4.4*		Deposit Agreement, dated as of September 25, 1996, by and among Euramax International plc, Euramax European Holdings plc, Euramax European Holdings B.V., and The Chase Manhattan Bank, as book-entry depositary
4.5*		Registration Rights Agreement, dated as of September 25, 1996, by and among Euramax International plc, Euramax European Holdings plc, Euramax European Holdings B.V., Amerimax Holdings, Inc. and J.P. Morgan Securities Inc. and Goldman Sachs & Co.
4.6*		Purchase Agreement dated as of September 18, 1996, by and among Euramax International Ltd., Euramax European Holdings Ltd., Euramax European Holdings B.V., Amerimax Holdings, Inc. and J.P. Morgan Securities Inc. and Goldman Sachs & Co.
4.7*******		Supplemental Indenture, dated as of November 18, 1999, among Euramax International Limited, Euramax European Holdings plc, Euramax European Holdings, B.V., as Issuers, Amerimax Holdings, Inc., as Guarantor, and The Chase Manhattan Bank, as Trustee
4.8*******		Amended and Restated Supplemental Indenture, dated as of December 14, 1999, among Euramax International Limited, Euramax European Holdings plc, Euramax European Holdings, B.V., as Issuers, Amerimax Holdings, Inc., as Guarantor, and The Chase Manhattan Bank, as Trustee
10.1*		Purchase Agreement, dated as of June 24, 1996, by and between Euramax International Ltd. and Alumax Inc.
10.2*		Executive Employment Agreement, dated as of September 25, 1996, by and between J. David Smith and Euramax International plc
10.5*		Domestic Security Agreement, dated as of September 25, 1996, by Amerimax Holdings, Inc. in favor of Banque Paribas, as agent
10.6*		Domestic Security Agreement, dated as of September 25, 1996, by Amerimax Fabricated Products, Inc. in favor of Banque Paribas, as agent
10.7*		Domestic Security Agreement, dated as of September 25, 1996, by Amerimax Home Products, Inc. in favor of Banque Paribas, as agent
10.8*		Domestic Security Agreement, dated as of September 25, 1996, by Amerimax Building Products, Inc. in favor of Banque Paribas, as agent
10.9*		Domestic Security Agreement, dated as of September 25, 1996, by Amerimax Coated Products, Inc. in favor of Banque Paribas, as agent
10.10*		Domestic Security Agreement, dated as of September 25, 1996, by Johnson Door Products, Inc. in favor of Banque Paribas, as agent
10.11*		Domestic Security Agreement, dated as of September 25, 1996, by Amerimax Specialty Products, Inc. in favor of Banque Paribas, as agent
10.12*		Domestic Subsidiary Guaranty, dated as of September 25, 1996, by each of Amerimax Home Products, Inc., Amerimax Specialty Products, Inc., Amerimax Building Products, Inc., Amerimax Coated Products and Johnson Door Products,  Inc. in favor of the Guarantied Parties referred to therein

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10.13*		U.S. Holdings Guaranty, dated as of September 25, 1996, by Amerimax Holdings, Inc. in favor of the Guaranteed Parties referred to therein
10.14*		U.S. Holdings Pledge Agreement, dated as of September 25, 1996, by Amerimax Holdings, Inc., to Banque Paribas, as Agent
10.15*		U.S. Operating Co. Guaranty, dated as of September 25, 1996, by Amerimax Fabricated Products, Inc. in favor of the Guarantied Parties referred to therein
10.16*		U.S. Operating Co. Pledge Agreement dated as of September 25, 1996, by Amerimax Fabricated Products, Inc. to Banque Paribas, as Agent
10.17*		Euramax Assignment Agreement, dated as of September 25, 1996, by Euramax International plc in favor of Banque Paribas, as Agent
10.18*		Euramax Pledge Agreement, dated as of September 25, 1996, by Euramax International plc to Banque Paribas, as Agent
10.19*		Building Products Pledge Agreement, dated as of September 25, 1996, by Amerimax Building Products, Inc. to Banque Paribas, as Agent
10.20*		Dutch Holdings Guaranty, dated as of September 25, 1996, by Euramax European Holdings B.V. in favor of the Guarantied Parties referred to therein
10.21*		Dutch Company Guaranty, dated as of September 25, 1996, by Euramax Netherlands B.V., in favor of the Guarantied Parties referred to therein
10.22*		Dutch Operating Co. Guaranty, dated as of September 25, 1996, by Euramax Europe B.V., in favor of the Guarantied Parties referred to therein
10.23*		Dutch Subsidiary Guaranty, dated as of September 25, 1996, by Euramax Coated Products B.V., in favor of the Guarantied Parties referred to therein
10.24***		Amended and Restated Credit Agreement, dated as of July 16, 1997, by and among Amerimax Fabricated Products, Euramax Holdings Limited, Euramax Europe B.V., Euramax Netherlands B.V., as Borrowers; Euramax International plc, Amerimax Holdings, Inc., Euramax European Holdings plc, Euramax European Holdings B.V., Euramax Europe Limited and certain of their operating subsidiaries, as other Loan Parties; Banque Paribas, as Agent, as a Lender and as the Issuer; and the other lenders named therein. (Incorporated by reference to Exhibit 10.1 of the Registrant's Form 10-Q for the quarter ended June 28, 1997.)
10.25***		Amendment to Credit Agreement, dated as of December 18, 1997, by and among Amerimax Fabricated Products, Euramax Holdings Limited, Euramax Europe B.V., Euramax Netherlands B.V., as Borrowers; Euramax International plc, Amerimax Holdings, Inc., Euramax European Holdings plc, Euramax European Holdings B.V., Euramax Europe Limited and certain of their operating subsidiaries, as other Loan Parties; Banque Paribas, as Agent, as a Lender and as the Issuer; and the other lenders named therein. (Incorporated by reference to Exhibit 10.25 of the Registrant's Form 10-K for the year ended December 26, 1997.)
10.26****		Incentive Compensation Plan effective January 1, 1997, by Euramax International Limited
10.27****		Phantom Stock Plan effective January 1, 1999, by Euramax International Limited

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10.28*****		Amendment and Waiver dated as of April 6, 1999, among Euramax International Limited, and its subsidiaries, Paribas (as Agent and Lender), and the Lenders, to the Amended and Restated Credit Agreement dated as of July 16, 1997
10.29*******		Amendment, dated as of December 8, 1999, among Euramax International Limited, the other Loan Parties, the Swing Loan Lender and the Issuer and Paribas, as Agent, to (a) the Amended and Restated Credit Agreement, dated as of July 16, 1997 and (b) the other Loan Documents
10.30*******		Amendment and Consent, dated as of December 9, 1999, among Euramax International Limited, the other Loan Parties, the Swing Loan Lender and the Issuer and Paribas, as Agent, to (a) Amended and Restated Credit Agreement, dated as of July 16, 1997 and (b) the other Loan Documents
10.31		Amendment and Waiver dated as of April 10, 2000, among Euramax International, Inc. and its subsidiaries, Paribas (as Agent and Lender), and the Lenders, to the Amended and Restated Credit Agreement dated as of July 16, 1997
27		Financial Data Schedule

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*		Incorporated by reference to the Exhibit with the same number in the Registrant's Registration Statement on Form S-4 (333-05978) which became effective on February 7, 1997.
**		Incorporated by reference to the Exhibit with the same number in the Registrant's Annual Report on Form 10-K (333-05978) which was filed on March 12, 1998.
***		Incorporated by reference to the Exhibit with the same number in the Registrant's Annual Report on Form 10-K (333-05978) which was filed on March 5, 1999.
****		Incorporated by reference to the Exhibit with the same number in the Quarterly Report on Form 10-Q (333-05978) which was filed on April 26, 1999.
*****		Incorporated by reference to the Exhibit with the same number in the Quarterly Report on Form 10-Q (333-05978) which was filed on August 2, 1999.
******		Incorporated by reference to the Exhibit with the same number in the Quarterly Report on Form 10-Q (333-05978) which was filed on November 3, 1999.
*******		Incorporated by reference to the Exhibit with the same number in the Registrant's Annual Report on Form 10-K (333-05978) which was filed on March 23, 2000.
********		Incorporated by reference to Exhibit 2.2 in the Registrant's Current Report on Form 8-K (333-05978) which was filed on April 24, 2000.

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SIGNATURES

    Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, Euramax International, Inc. has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

EURAMAX INTERNATIONAL, INC.

Signature		Title		Date
/s/ J. DAVID SMITH    J. David Smith		Chief Executive Officer and President		August 10, 2000
/s/ R. SCOTT VANSANT    R. Scott Vansant		Chief Financial Officer and Secretary		August 10, 2000

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QuickLinks

Item 1. Financial Statements

Litigation
Environmental Matters

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Business Overview
Results of Operations
Quarter Ended June 30, 2000 as Compared to Quarter Ended June 26, 1999
Six Months Ended June 30, 2000 as Compared to Six Months Ended June 26, 1999
Liquidity and Capital Resources
Recent Accounting Pronouncements
Environmental Matters
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Interest Rate Risk
Foreign Currency Exchange Risk

Part II—Other Information