<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended August 31, 1994 Commission file number 0-947
--------------- -----
AMCAST INDUSTRIAL CORPORATION
(Exact name of registrant as specified in its charter)
OHIO 31-0258080
- - ------------------------ --------------------------
(State of Incorporation) (I.R.S. employer
identification no.)
7887 Washington Village Drive, Dayton, Ohio 45459
- - -----------------------------------------------------------------------------
(Address of principal executive officers) (Zip Code)
291-7000 (Area Code 513)
- - -----------------------------------------------------------------------------
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
COMMON SHARES, WITHOUT PAR VALUE
PREFERRED SHARE PURCHASE RIGHTS
Securities registered pursuant to Section 12(g) of the Act:
NONE
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 and 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months, and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
Aggregate market value of common stock, no par value, held by non-affiliates
of the registrant (assuming only for the purposes of this computation that
directors and officers may be affiliates) as of October 14, 1994--$183,119,442.
Number of common shares outstanding, without par value, as of October 14,
1994--8,459,396 shares.
DOCUMENTS INCORPORATED BY REFERENCE
Parts I, II and IV--Portions of Annual Report to Shareholders for the year
ended August 31, 1994.
Part III--Portions of Proxy Statement for the Annual Meeting of Shareholders
to be held on December 14, 1994 filed November 10, 1994.
Index to exhibits at page 19 of this report.
<PAGE> 2
PART I
------
ITEM 1 - BUSINESS
- - -----------------
Amcast Industrial Corporation, an Ohio corporation organized in 1869, and
its subsidiaries (called collectively "Amcast" or the "company") are engaged in
the business of producing fabricated metal products, valves and controls, and
cast and tubular metal products, in a variety of shapes, sizes, and metals for
sale to end users directly and through sales representatives and distributor
organizations and to original equipment manufacturers. Manufacturing
facilities are located in five states, primarily in the eastern half of the
United States. The company's business operations are conducted through three
divisions and nine wholly-owned subsidiaries. Its subsidiaries include Amcast
Industrial Ltd., an Ontario, Canada corporation; Elkhart Products Corporation
(Elkhart), an Indiana corporation; WheelTek, Inc. (WheelTek), an Indiana
corporation; Amcast Industrial Investment Corporation, a Delaware corporation;
Amcast Automotive, Inc. (formerly Midwest Marketing Services Corporation), a
Michigan corporation; Amcast Industrial Financial Services, Inc., an Ohio
corporation; Amcast Industrial Sales Corporation, a U.S. Virgin Islands
corporation; Amcast Casting Technologies, Inc., an Indiana Corporation and
Amcast Precision Products, Inc., a California corporation. During fiscal 1992,
Amcast and Izumi Industries, Ltd. of Japan, formed a joint venture, Casting
Technology Corporation. Amcast owns 60% of the joint venture. In 1994, the
joint venture was converted to a partnership, Casting Technology Company.
During the fourth quarter of 1993, the company elected early adoption,
effective September 1, 1992, of the Statement of Financial Accounting Standards
(SFAS) No. 106, "Employers' Accounting for Postretirement Benefits Other Than
Pensions". This statement requires companies to record a liability for
employees' accumulated postretirement benefit costs and to recognize on-going
expenses on an accrual basis. The company recognized a $6,159 pretax
cumulative effect of the change in accounting principle, which represents the
accumulated postretirement benefit obligation as of September 1, 1992. The
effect on net income and shareholders' equity was $3,942, or $.47 per share.
The impact on fiscal year 1993 operating results, due to the adoption of SFAS
106, was not material. See Postretirement Health Care and Life Insurance
footnote of the company's Annual Report to Shareholders for the year ended
August 31, 1994, Exhibit 13.1, page 52 herein.
Effective August 31, 1992, the company's Board of Directors approved a
plan to divest Stanley G. Flagg & Co. (Flagg), a manufacturer of iron and brass
pipe fittings, previously reported as part of the Flow Control Products
segment. This action was prompted by unprofitable operations that were plagued
by industry overcapacity and weak demand in the iron pipe fittings product
line. The company made a pretax provision of $22 million based on the expected
proceeds of this divestiture. A significant portion of the Flagg assets,
relating to the iron and pole line hardware businesses, have been sold and,
although operating losses, until disposition, are greater than originally
estimated, the loss on the sale of assets and estimated liabilities are
expected to be less than the amounts initially provided. Annual sales and
results of the remaining brass business are not material to the company. At
August 31, 1994, the company believes that it has provided adequately for the
effect of the disposal of the remaining assets of Flagg and the operating
losses through the date of disposal. See Discontinued Operation footnote of
the company's Annual Report to Shareholders for the year ended August 31, 1994,
Exhibit 13.1, page 42 herein.
The company operates in two business segments--1) Flow Control Products
and (2) Engineered Components. Information concerning the net sales, operating
profit and identifiable assets of each segment for fiscal years 1992 through
1994 appears under "Business Segments" in the Notes to Consolidated Financial
Statements in the company's Annual Report to Shareholders for the year ended
August 31, 1994, Exhibit 13.1, page 56 herein. Amcast has no foreign
manufacturing operations and export sales to customers in foreign countries are
not material.
-2-
<PAGE> 3
ITEM 1 - BUSINESS (cont'd)
- - -----------------
FLOW CONTROL PRODUCTS
- - ---------------------
The Flow Control Products segment (Flow Control) includes the business of
the Superior Valve division (Superior Valve), the Elkhart subsidiary, and
Amcast Industrial Ltd. Superior Valve, acquired in October 1986, manufactures
valves and accessories used in air conditioning and refrigeration systems, and
compressed gas cylinder valves for the welding, specialty, carbonic, and
medical gas industries. Elkhart, acquired in July 1983, produces wrot copper
fittings for use in residential and commercial water systems and markets bronze
pipe fittings and valves. Amcast Industrial Ltd. is the common Canadian
marketing arm for Amcast's Flow Control segment manufacturing units.
The company's Flow Control business is a leading supplier of pipe
fittings for the industrial, commercial, and residential construction markets,
valves utilized in air-conditioning and refrigeration systems, and industrial
compressed gas applications. These products are sold through distributors and
wholesalers. Shipments are made by truck from company locations directly to
customers. The competition is comprised of a number of manufacturers of parts
for air conditioning, refrigeration, and plumbing systems, gas meters, and
valves and controls. The company believes that competition in this segment is
based on a number of factors including product quality, service, delivery, and
value.
Most of the Flow Control business is based on customer purchase orders
for their current product requirements and such orders are filled from company
inventory. Orders are not considered firm beyond a 90-day period.
See Properties at Item 2 of this report for information on the company's
facilities which operate in this segment.
ENGINEERED COMPONENTS
- - ---------------------
The Engineered Components segment produces cast and fabricated metal
products principally for sale to original equipment manufacturers in the
transportation, construction, air conditioning, refrigeration, and
aviation/defense industries. The company's manufacturing processes involve the
melting of raw materials for casting into metal products having the
configuration, flexibility, strength, weight, and finish required for the
customer's end use. The company also custom fabricates copper and aluminum
tubing parts. The company manufactures products on a high-volume,
medium-volume, and specialized basis and its metal capabilities include
aluminum, steel, brass, and copper. Products manufactured by this segment
include castings for suspension, air conditioning and anti-lock braking
systems, master cylinders, differential carriers and cast aluminum wheels for
use on automobiles and light trucks; and parts for use in heating and air
conditioning systems. The company also designs and manufactures close-tolerance
aluminum and specialty steel investment castings and related items for sale to
aviation and aerospace companies. Delivery is mostly by truck from Amcast
locations directly to customers.
Amcast is not solely dependent on a single customer. However, a
significant portion of the company's Engineered Components business is directly
or indirectly dependent on the major automobile manufacturers. The company's
net sales to various divisions of General Motors Corporation in fiscal 1994
were $89.3 million. No other customer accounted for more than 10% of
consolidated sales in fiscal 1994.
The company's non-aerospace business of the Engineered Components segment
is on a "blanket" order basis and is generally based on supplying a percentage
of the customer's annual requirements for a particular part. Customers issue
firm releases and shipping schedules each month against their blanket orders
depending on their current needs. As a result, order backlog varies from month
to month and is not considered firm beyond a 30-day period. Amcast believes
that price, product quality, and delivery are the principal bases of
competition within the industry.
-3-
<PAGE> 4
ITEM 1 - BUSINESS (cont'd)
- - -----------------
ENGINEERED COMPONENTS (cont'd)
- - ---------------------
The order backlog of the aviation and aerospace business was $23.4
million at August 31, 1994, and $25.5 million at August 31, 1993. Backlog at
August 31, 1994, is expected to result in revenue of $12.3 million during
fiscal 1995.
See Properties at Item 2 of this report for information on the company's
facilities which operate in this segment.
GENERAL INFORMATION
- - -------------------
Raw materials essential to the business are purchased from suppliers
located in the general vicinity of each operating facility. Availability of
these materials is judged to be adequate. The company does not anticipate any
material shortage that will alter production schedules during the coming year.
Amcast owns a number of patents and patent applications relating to the
design of its products. While Amcast considers, in the aggregate, these
patents are important to operations, it believes that the successful
manufacture and sale of its products generally depend more on the company's
technological know-how and manufacturing skills.
Capital expenditures related to compliance with federal, state, and local
environmental protection regulations for fiscal 1995 and 1996 are not expected
to be material. Management believes that operating costs related to
environmental protection will not have a materially adverse effect on future
earnings or the company's competitive position in the industry.
The number of persons employed by the continuing operations of Amcast
averaged 2,100 in fiscal 1994 and 1,900 in both fiscal 1993 and 1992.
No material portion of Amcast's business is seasonal.
RECENT DEVELOPMENTS
- - -------------------
None
-4-
<PAGE> 5
ITEM 2 - PROPERTIES
- - -------------------
The following table provides certain information relating to the company's
principal facilities as of October 14, 1994:
<TABLE>
<CAPTION>
SQUARE
FACILITY FOOTAGE USE
- - ------------------------------------ ------- -------------------------------------
<S> <C> <C>
Flow Control Products Segment
- - -----------------------------
SUPERIOR VALVE DIVISION 80,200 High and low pressure specialty
Washington, Pennsylvania valve manufacturing plant,
warehouse, sales and general
offices
ELKHART PRODUCTS 222,000 Copper fittings manufacturing
CORPORATION SUBSIDIARY plant, warehouse, and sales and
Elkhart, Indiana general offices
Fayetteville, Arkansas 107,800 Copper fittings manufacturing
plant
AMCAST INDUSTRIAL LTD. 20,214 Distribution warehouse and branch
SUBSIDIARY sales office for Flow Control
Burlington, Ontario Canada Products
Engineered Components Segment
- - -----------------------------
ELKHART PRODUCTS 105,748 Custom fabricated copper and
CORPORATION SUBSIDIARY aluminum tubular products
Geneva, Indiana manufacturing plant
AMCAST PRECISION 70,000 Aluminum and specialty steel
PRODUCTS, INC. SUBSIDIARY investment casting foundry
Rancho Cucamonga, California
META-MOLD DIVISION 133,000 High-volume, aluminum alloy
Cedarburg, Wisconsin permanent-mold foundry
Richmond, Indiana 97,300 High-volume, aluminum alloy
permanent-mold foundry
WHEELTEK, INC. 139,788 Cast aluminum automotive wheels
SUBSIDIARY
Fremont, Indiana
Gas City, Indiana 76,000 Cast aluminum automotive wheels
AMCAST AUTOMOTIVE, INC. 8,840 Automotive component sales,
SUBSIDIARY product development and
Southfield, Michigan engineering center offices
</TABLE>
-5-
<PAGE> 6
ITEM 2 - PROPERTIES (cont'd)
- - -------------------
<TABLE>
<CAPTION>
SQUARE
FACILITY FOOTAGE USE
- - ------------------------------------ ------- -------------------------------------
<S> <C> <C>
Corporate
- - ---------
CORPORATE CENTER 16,281 Executive and general offices
Dayton, Ohio
Discontinued Operation
- - ----------------------
STANLEY G. FLAGG DIVISION 575,000 Brass foundry, machining
Stowe, Pennsylvania operations, warehouse, and sales
and general offices
</TABLE>
The land and building in Rancho Cucamonga, California, are leased under a
5-year lease, with a requirement that Amcast purchase the property at the fair
market price at the lease expiration in 1997. The land and building in
Burlington, Ontario, are leased under a 5-year lease expiring in 1995, with an
option to renew the lease for two successive 5-year terms. The land in
Richmond and Gas City, Indiana is leased under 99 year leases, expiring in
2091. The Corporate offices are being leased for five years expiring in 1998.
The Amcast Automotive offices are being leased for five years expiring in the
year 2000, with an option for a five year renewal. All other properties are
owned by the company. The lease at the former Miami, Florida facility was
terminated during fiscal year 1994 and operations were transferred to the
Rancho Cucamonga, California facility.
A portion of the land and building at Fayetteville, Arkansas is subject
to a mortgage in favor of Bank One, Dayton, NA, to secure the payment of a
$5,050,000 bond issue dated December 1, 1991, and maturing December 1, 2004.
The company's operating facilities are in good condition and are suitable
for the company's purposes. Utilization of capacity is dependent upon customer
demand. During fiscal 1994, productive capacity utilization by division ranged
from 58% to 90%, and averaged 78% of the company's total capacity.
-6-
<PAGE> 7
ITEM 3 - LEGAL PROCEEDINGS
- - --------------------------
The company is subject to a range of federal, state and local laws and
regulations governing the discharge of material into the environment or
otherwise relating to the protection of the environment. The company
periodically makes capital expenditures to meet the requirements of these laws
and regulations; however, the company believes that the anticipated
expenditures for such purposes in the foreseeable future will not be material
to its financial position or its competitive position.
The company, as is normal for the industry in which it operates, is
subject to periodic environmental site investigations and inquiries. The
company has been identified as a potentially responsible party by various state
agencies and by the United States Environmental Protection Agency (U.S. EPA)
under the Comprehensive Environmental Response, Compensation and Liability Act
of 1980, as amended, for costs associated with eight U.S. EPA led multi-party
"superfund" sites and three state environmental agency led remediation sites.
While the company could be found jointly and severally liable at a number of
these sites, the company, in each case, is contesting any responsibility or
believes that its liability will not be material because of the nature of the
waste involved or the limited amount of waste generated by the company which
was allegedly disposed of at these sites. With respect to one such site
located in Ironton, Ohio, another potentially responsible party has brought an
action entitled ALLIED-SIGNAL, INC., V. AMCAST INDUSTRIAL CORPORATION, in the
U.S. District Court for the Southern District of Ohio, Western Division, Case
No. C-3-92-013, seeking contribution from the company for a portion of the
total response and remediation costs, which the plaintiff has claimed may
exceed $20 million. The company believes that its ultimate equitable share, if
any, of any liability for cleanup costs at this site will not be material.
The company also is a defendant in a lawsuit entitled PUBLIC INTEREST
RESEARCH GROUP, INC., ET AL. V. STANLEY G. FLAGG & CO., ET AL., in the U.S.
District Court for the Eastern District of Pennsylvania, Case No. 89-2137,
which alleges that the content of zinc and other minerals in the waste water
discharged at the company's Stowe, Pennsylvania, facility exceeded the levels
allowed under the applicable permit during the period from October 1984 through
October 1988. The suit seeks the assessment of penalties; however, the company
believes that penalties, if any, should not be material because the discharge
currently is in compliance with the permit.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
- - ------------------------------------------------------------
None
-7-
<PAGE> 8
ITEM 4A - EXECUTIVE OFFICERS OF REGISTRANT
- - ------------------------------------------
Leo W. Ladehoff, age 62, has been a Director since 1978, Chairman of the
Board of the company since December 1980, Chief Executive Officer since May
1979, and President of the company from September 1990 to December 1993. Mr.
Ladehoff was also President of the company from December 1978 until November
1986.
John H. Shuey, age 48, has been President and Chief Operating Officer
since December 1993 and a Director since March 1994. He was Executive Vice
President from February 1991 to December 1993. From 1986 to 1991, Mr. Shuey
was Senior Vice President, Finance and Chief Financial Officer at AM
International (producer of business graphics equipment used in preparation and
reproduction of information).
Dennis A. Bertram, age 57, has been President and General Manager of the
Automotive Products Group since May 1992. From May 1989 to May 1992 he was
Vice President and General Manager of the WheelTek Division. From July 1986 to
May 1989 he was Vice President of Operations for WheelTek.
J. Randall Caraway, age 43, has been President of Amcast Precision
Products, Inc. since March 1991. From August 1990 to March 1991 he was Vice
President/General Manager of the Ontario Division. From 1988 to 1990 Mr.
Caraway was President of Coastcast in California. Prior to his role of
President he was Vice President of Operations of Coastcast.
David L. Ewing, age 46, has been President of the Flow Control Products
Group since January 1994 and Vice President/General Manager of Elkhart Products
Corporation, Plumbing Division since April 1990. From May 1989 to April 1990
Mr. Ewing was President of Sensus Technologies. From September 1987 to May
1989 he was President of the coupling division of Rockwell International in
TexarKana, Arkansas.
Michael N. Powell, age 47, has been Vice President/General Manager of
Superior Valve Company since April 1994. Mr. Powell was President and Chief
Operating Officer of Versa Technologies, Inc. in Racine, Wisconsin from May
1991 to December 1993. Prior to that he was a Senior Vice President for Mark
Controls Corporation in Skokie, Illinois.
Douglas D. Watts, age 49, has been Vice President, Finance since August
1994. From 1987 to August 1994 Mr. Watts held various financial management
positions with General Cable Corporation, of which the most recent post was
Vice President and Controller. From 1985 to 1987 he was Vice President, Finance
and Chief Financial Officer of LCP Chemicals and Plastics, Inc., Edison, New
Jersey.
William L. Bown, age 48, has been Vice President and Controller since
June 1992. From November 1983 to May 1992 Mr. Bown was Controller of
Worthington Industries, Inc. in Columbus, Ohio.
Denis G. Daly, age 52, has been Vice President, Legal Affairs and
Secretary, since January 1990. From January 1988 to December 1989 he worked in
private practice at the law firm of Thompson, Hine, and Flory. From August
1982 to January 1988 he was Vice President, General Counsel, and Secretary at
Day International (Dayco) in Dayton.
William J. Durbin, age 49, has been Vice President, Human Resources,
since July 1984. Mr. Durbin was Director of Personnel and Director of
Management Resources of Carrier Transicold Co., Carrier North American
Operations, and Carrier International Corp. from 1978 to 1984.
Myron E. Frye, age 55, has been Vice President of Purchasing since
November 1992. From March 1983 to November 1992 he was President of Purchasing
/ Materials Group, Inc. in Naperville, Illinois.
-8-
<PAGE> 9
ITEM 4A - EXECUTIVE OFFICERS OF REGISTRANT (cont'd)
- - ------------------------------------------
Robert P. Hensley, age 63, has been Assistant Vice President of Risk
Management/ Assistant Secretary, since March 1989. From January 1987 to March
1989 he was Director of Risk Management/Assistant Secretary.
Michael R. Higgins, age 48, has been Treasurer since January 1987.
Yeshwant P. Telang, age 69, has been Senior Vice President, Technology
and Competitive Manufacturing, since November 1991. He was Vice President,
Technology from January 1985 to November 1991.
Officers of Amcast are elected at the Board of Directors' first meeting
following the annual meeting of shareholders and hold office until the first
meeting of the board following the next Annual Meeting of Shareholders.
PART II
-------
ITEM 5 - MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
- - --------------------------------------------------------------
STOCKHOLDER MATTERS
-------------------
Amcast common stock is listed on the New York Stock Exchange, ticker
symbol AIZ. As of August 31, 1994, there were 8,457,896 of the Company's
common shares outstanding, and there were approximately 7,000 shareholders of
Amcast's common stock, including shareholders of record and the company's
estimate of beneficial holders.
<TABLE>
<CAPTION>
Range of Stock
Prices
----------------- Dividends
High Low Per Share
---- --- ---------
<S> <C> <C> <C> <C>
1994
----
First Quarter $ 20 3/4 $ 20 1/4 $ .12
Second Quarter 25 3/4 25 1/8 .12
Third Quarter 25 7/8 21 3/8 .12
Fourth Quarter 22 20 .13
1993
----
First Quarter $ 16 3/8 $ 11 5/8 $ .12
Second Quarter 20 15 .12
Third Quarter 22 1/2 18 5/8 .12
Fourth Quarter 22 1/8 16 5/8 .12
</TABLE>
See Long-Term Debt and Credit Arrangement footnote of the company's Annual
Report to Shareholders for the year ended August 31, 1994, Exhibit 13.1, page
45 herein for other information required by this item.
ITEM 6 - SELECTED FINANCIAL DATA
- - --------------------------------
See "Selected Data" of the company's Annual Report to Shareholders for
the year ended August 31, 1994, Exhibit 13.1, page 35 herein.
-9-
<PAGE> 10
ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
- - ----------------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
See "Results of Continuing Operations", "Liquidity", and "Capital
Resources" of the company's Annual Report to Shareholders for the year ended
August 31, 1994, Exhibit 13.1, pages 30-34 herein.
ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
- - ----------------------------------------------------
See "Financial Statements and Notes", together with the report thereon of
Ernst & Young LLP and "Quarterly Financial Data (Unaudited)" of the company's
Annual Report to Shareholders for the year ended August 31, 1994, Exhibit 13.1,
pages 36-57 herein.
ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
- - ---------------------------------------------------------
ACCOUNTING AND FINANCIAL DISCLOSURE
-----------------------------------
None
PART III
--------
ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
- - ------------------------------------------------------------
The information required by this item relating to directors of the
company is incorporated herein by reference to that part of the information
under "Election of Directors" beginning on page 2 of the company's Proxy
Statement for its Annual Meeting of Shareholders to be held on December 14,
1994. Information concerning executive officers of the company appears under
"Executive Officers of Registrant" at Part I, page 8, of this Report.
ITEM 11 - EXECUTIVE COMPENSATION
- - --------------------------------
The information required by this item is incorporated herein by reference
to "Executive Compensation" on pages 6 through 12 of the company's Proxy
Statement for its Annual Meeting of Shareholders to be held on December 14,
1994.
ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
- - -------------------------------------------------------------
MANAGEMENT
----------
The information required by this item is incorporated herein by reference
to "Security Ownership of Directors, Nominees and Officers" on page 5 and
"Security Ownership of Certain Beneficial Owners" on page 15 of the company's
Proxy Statement for its Annual Meeting of Shareholders to be held on December
14, 1994.
ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
- - --------------------------------------------------------
The information required by this item is contained on pages 12 and 13 in
the company's Proxy Statement for its Annual Meeting of Shareholders to be held
on December 14, 1994, which is incorporated herein by reference.
-10-
<PAGE> 11
PART IV
-------
ITEM 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS
- - --------------------------------------------------------------
ON FORM 8-K
-----------
(a) Documents filed as part of this report.
1. Financial statements:
The following financial statements of Amcast Industrial Corporation
and subsidiaries, included in the Annual Report to Shareholders for
the year ended August 31, 1994, are incorporated by reference at
Item 8 of this report.
Consolidated Statements of Operations -
Years Ended August 31, 1994, 1993, and 1992.
Consolidated Statements of Financial Condition -
August 31, 1994 and 1993.
Consolidated Statements of Shareholders' Equity -
Years Ended August 31, 1994, 1993 and 1992.
Consolidated Statements of Cash Flows -
Years Ended August 31, 1994, 1993, and 1992.
Notes to Consolidated Financial Statements
2. Consolidated financial statement schedules:
<TABLE>
Schedule Page Number
Number Description In This Report
-------- --------------------------------------------------------------- --------------
<S> <C> <C>
V Property, plant and equipment - August 31, 1994, 1993, and 1992 14
VI Accumulated depreciation of property, plant and equipment -
August 31, 1994, 1993, and 1992 15
VIII Valuation and qualifying accounts and reserves -
August 31, 1994, 1993, and 1992 16
IX Short-term borrowings - August 31, 1994, 1993, and 1992 17
X Supplementary income statement information - August 31, 1994,
1993, and 1992 18
</TABLE>
All other financial statement schedules are omitted because they
are not applicable or because the required information is shown in
the financial statements and notes.
3. Exhibits - See Index to Exhibits (page 19 hereof).
4. Form 8-K - During the quarter ended August 31, 1994, the company
did not file any reports on Form 8-K.
-11-
<PAGE> 12
SIGNATURES
Pursuant to the requirements of Section 13 of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized, on the 29th day of November 1994.
AMCAST INDUSTRIAL CORPORATION
(Registrant)
By /s/Leo W. Ladehoff
----------------------------------
Leo W. Ladehoff
Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated.
Signature Title Date
- - ------------------- ------------------------- -----------------
/s/Leo W. Ladehoff Chairman of the Board and November 29, 1994
- - -------------------
Leo W. Ladehoff Chief Executive Officer, Director
/s/John H. Shuey President and Chief November 29, 1994
- - -------------------
John H. Shuey Operating Officer, Director
/s/Douglas D. Watts Vice President, Finance November 29, 1994
- - -------------------
Douglas D. Watts
/s/William L. Bown Vice President and Controller November 29, 1994
- - -------------------
William L. Bown
*James K. Baker Director November 29, 1994
*Walter E. Blankley Director November 29, 1994
*Peter H. Forster Director November 29, 1994
*Ivan W. Gorr Director November 29, 1994
*Earl T. O'Loughlin Director November 29, 1994
*William G. Roth Director November 29, 1994
*R. William Van Sant Director November 29, 1994
*The undersigned Leo W. Ladehoff, by signing his name hereto, does sign
and execute this annual report on Form 10-K on behalf of each of the
above-named directors of the registrant pursuant to powers of attorney executed
by each such director and filed with the Securities and Exchange Commission as
an exhibit to this report.
By /s/Leo W. Ladehoff
-------------------------
Leo W. Ladehoff
Attorney in Fact
-12-
<PAGE> 13
SCHEDULE V and VI - PROPERTY, PLANT AND EQUIPMENT (A)
(Thousands of dollars)
AMCAST INDUSTRIAL CORPORATION AND SUBSIDIARIES
Years Ended August 31
______________________________________________________________________________
Notes to Schedules V and VI:
(1) Represents normal additions.
(2) Reclassification from Construction in Progress to specific asset accounts.
(3) Reclassification among fixed asset accounts.
(4) Reclassification between Other Assets and fixed asset accounts.
(5) Reclassification to net assets of discontinued operation.
(6) Write-down in carrying value of equipment and/or disposal of equipment
previously written down.
(7) Property not used in ongoing operations - reclassified to Other Assets.
(8) Adjustment due to foreign currency translation.
(9) Reclassification between inventory and fixed asset accounts.
(A) The principal lives and depreciation methods used for the above asset
classifications are:
<TABLE>
<CAPTION>
Classification Lives Depreciation Methods
-------------- ----- -----------------------------------------
<S> <C> <C>
Land improvements 20 yrs. Straight-line
Buildings 20-40 yrs. Straight-line
Machinery and equipment 3-20 yrs. Straight-line
</TABLE>
-13-
<PAGE> 14
<TABLE>
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A) (Thousands of dollars)
AMCAST INDUSTRIAL CORPORATION AND SUBSIDIARIES -- Years Ended August 31
<CAPTION>
- - ------------------------------------------------------------------------------------------------------------------------------------
Col A Col. B Col. C Col. D Col. E Col. F
- - ------------------------------------------------------------------------------------------------------------------------------------
Balance
Beginning Additions Other Changes Balance at
Classification of Period at Cost Retirements Transfers Other End of Period
- - ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1994 Land and land improvements $ 1,586 $ 37 $ (8) $ 325 (2) $ - $ 1,940
- - ----
Buildings 20,458 68 (39) 4,667 (2) - 25,130
(24)(3)
Machinery and equipment 99,768 1,502 (888) 11,315 (2) 6 (4) 110,287
(1,344)(3) (67)(6)
(5)(8)
Construction -in-progress 12,809 13,989 (30) (16,307)(2) (1)(4) 11,828
1,368 (3)
-------- -------- -------- --------- -------- --------
$134,621 $ 15,596 (1) $ (965) $ - $ (67) $149,185
======== ======== ======== ========= ======== ========
1993 Land and land improvements $ 1,419 $ 18 $ (164) $ 313 (2) $ - $ 1,586
- - ----
Buildings 19,280 170 (1,948) 2,940 (2) (1)(8) 20,458
17 (3)
Machinery and equipment 89,415 2,604 (1,439) 9,587 (2) 34 (4) 99,768
(380)(3) (39)(6)
(14)(8)
Construction-in-progess 14,088 11,198 - (12,840)(2) - 12,809
363 (3)
-------- -------- -------- --------- -------- --------
$124,202 $ 13,990 (1) $ (3,551) $ $ (20) $134,621
======== ======== ======== ========= ======== ========
1992 Land and land improvements $ 1,775 $ 152 $ - $ 6 (2) $ (514)(5) $ 1,419
- - ----
Buildings 22,735 121 (27) 238 (2) (1)(8) 19,280
(3,786)(5)
Machinery and equipment 112,351 2,986 (1,625) (339)(3) (7)(8) 89,415
10,204 (2) 96 (9)
100 (6)
(34,351)(5)
Construction-in-progress 4,092 20,534 (10) (10,448)(2) (7)(7) 14,088
339 (3) (412)(5)
-------- -------- -------- --------- -------- --------
$140,953 $ 23,793 (1) $ (1,662) $ - $(38,882) $124,202
======== ======== ======== ========= ======== ========
</TABLE>
-14-
<PAGE> 15
<TABLE>
SCHEDULE VI - ACCUMULATED DEPRECIATION OF PROPERTY, PLANT AND EQUIPMENT
(Thousands of dollars)
AMCAST INDUSTRIAL CORPORATION AND SUBSIDIARIES
Years Ended August 31
<CAPTION>
- - ---------------------------------------------------------------------------------------------------------------------------------
Col. A Col. B Col. C Col. D Col. E Col. F
- - ---------------------------------------------------------------------------------------------------------------------------------
Balance Other Changes
Beginning Additions ------------- Balance at
Classification of Period at Cost Retirements Transfers Other End of Period
- - ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1994 Land and land improvements $ 120 $ 57 $ - $ 1 (3) $ - $ 178
---- Buildings 6,582 1,061 (11) (15)(3) 7,617
Machinery and equipment 57,710 10,818 (808) 14 (3) 5 (4) 67,736
(3)(8)
------- ------- -------- ------- -------- -------
$64,412 $11,936 $ (819) $ - $ 2 $75,531
======= ======= ======== ======= ======== =======
1993 Land and land improvements $ 129 $ 28 $ (37) $ - $ - $ 120
---- Buildings 6,777 895 (1,090) - - 6,582
Machinery and equipment 48,892 10,213 (1,406) - 19 (4) 57,710
(8)(8)
------- ------- -------- ------- -------- -------
$55,798 $11,136 $ (2,533) $ - $ 11 $64,412
======= ======= ======== ======= ======== =======
1992 Land and land improvements $ 110 $ 19 $ - $ - $ - $ 129
---- Buildings 7,434 1,063 (11) (10)(3) (1,699)(5) 6,777
Machinery and equipment 61,325 11,654 (1,273) 10 (3) (22,865)(5) 48,892
(2)(4)
46 (9)
(3)(8)
------- ------- -------- ------- -------- -------
$68,869 $12,736 $ (1,284) $ - $(24,523) $55,798
======= ======= ======== ======= ======== =======
</TABLE>
-15-
<PAGE> 16
<TABLE>
SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
AMCAST INDUSTRIAL CORPORATION AND SUBSIDIARIES
(Thousands of dollars)
<CAPTION>
- - --------------------------------------------------------------------------------------------------------------------------------
Col. A Col. B Col. C Col. D Col. E
- - --------------------------------------------------------------------------------------------------------------------------------
Additions
--------------------------
Balance Charged to Charged to
Beginning Costs and Other Balance at
Description of Period Expenses Accounts Deductions End of Period
- - --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Deducted From Asset Accounts
Reserves for unrealized
losses on properties and other
assets held for sale:
Year ended August 31, 1994 $ 11,370 $ (8,297) $ 3,073
Year ended August 31, 1993 $ 11,117 - $ 270 $ (17) $ 11,370
Year ended August 31, 1992 $ 1,417 $ 9,700 (1) $ - $ - $ 11,117
Valuation reserves to state accounts
receivable and inventories at their
net realizable value:
Year ended August 31, 1994 $ 421 $ 664
Year ended August 31, 1993 $ 665 $ 421
Year ended August 31, 1992 $ 1,213 $ 665
<FN>
(1) Reserve for loss on sale of net assets of discontinued operation.
</TABLE>
-16-
<PAGE> 17
<TABLE>
SCHEDULE IX - SHORT-TERM BORROWINGS
AMCAST INDUSTRIAL CORPORATION AND SUBSIDIARIES
(Thousands of dollars)
<CAPTION>
- - ---------------------------------------------------------------------------------------------------------------------
Col. A Col. B Col. C Col. D Col. E(2) Col. F(3)
- - ---------------------------------------------------------------------------------------------------------------------
Maximum Average Weighted
Weighted Amount Amount Average
Balance at Average Outstanding Outstanding Interest Rate
Category of Aggregate End of Interest During the During the During the
Short-Term Borrowings (1) Period Rate Period Period Period
- - ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Year ended August 31, 1994:
Notes payable to banks $ - -% $ 3,100 $ 425 3.6%
Year ended August 31, 1993:
Notes payable to banks $ - -% $ 7,100 $2,825 3.9%
Year ended August 31, 1992:
Notes payable to banks $ - -% $ 10,000 $4,192 5.4%
<FN>
(1) Notes payable to banks represent borrowings under revolving credit
arrangements and lines of credit borrowing arrangements
described in the Notes to Consolidated Financial Statements.
(2) The average amount outstanding during the period was computed by
dividing the total of month-end outstanding principal balances by 12.
(3) The weighted average interest rate during the period was computed by
annualizing the result of actual interest expense divided by the
average amount outstanding during the period.
</TABLE>
-17-
<PAGE> 18
<TABLE>
SCHEDULE X - SUPPLEMENTARY INCOME STATEMENT INFORMATION
(Thousands of dollars)
AMCAST INDUSTRIAL CORPORATION AND SUBSIDIARIES
YEARS ENDED AUGUST 31
- - ---------------------------------------------------------------------------------------------------
Col. A Col. B.
- - ---------------------------------------------------------------------------------------------------
<CAPTION>
Item Charged to Costs and Expenses
- - ---------------------------------------------------------------------------------------------------
1994 1993 1992
----- ----- ------
<S> <C> <C> <C>
Maintenance and repairs $6,594 $4,726 $5,646
Depreciation and amortization of
intangible assets, preoperating
costs and similar deferrals * * *
Taxes, other than payroll and income taxes * * *
Royalties * * *
Advertising costs * * *
* Less than 1% of total sales and revenues
</TABLE>
-18-
<PAGE> 19
<TABLE>
INDEX OF EXHIBITS
-----------------
<CAPTION>
Exhibit Located at
Number Description Numbered Page
- - ------- -------------------------------------------------------------- -------------
<S> <C> <C>
3 ARTICLES OF INCORPORATION AND BY-LAWS:
3.1 Articles of Incorporation of Amcast Industrial
Corporation - incorporated by reference from Form
10-K for the year ended August 31, 1987.
3.2 Code of Regulations of Amcast Industrial
Corporation - incorporated by reference from
Form 10-K for the year ended August 31, 1987.
4 INSTRUMENTS DEFINING THE RIGHTS OF SECURITY
HOLDERS, INCLUDING INDENTURES:
4.1 $40,000,000 Credit Agreement between Amcast
Industrial Corporation and Star Bank, National
Association, The First National Bank of Chicago,
Bank One, Dayton, NA, and Society National Bank
dated September 30, 1992 - incorporated by reference
from form 10-K for the year ended August 31, 1992.
4.2 Loan Agreement between the City of Elkhart, Indiana,
and Elkhart Products Corporation, dated as of February
1, 1988, for $2,050,000, Economic Development
Revenue Refunding Bonds, Series 1988. +
4.3 $20,000,000 Senior Note Agreement between
Amcast Industrial Corporation and Principal
Mutual Life Insurance Company (formerly
Bankers Life Company), dated May 1, 1986,
as amended - incorporated by reference
from Form 10-K for the year ended August
31, 1987.
4.4 Amendment Agreement to the $20,000,000 Senior
Note Agreement between Amcast Industrial
Corporation and Principal Mutual Life
Insurance Company, dated October 1, 1990,
effective August 31, 1990 - incorporated by
reference from Form 10-K for the year ended
August 31, 1990.
</TABLE>
-19-
<PAGE> 20
<TABLE>
INDEX TO EXHIBITS (cont'd)
-----------------
<CAPTION>
Exhibit Located at
Number Description Numbered Page
- - ------- -------------------------------------------------------------- -------------
<S> <C> <C>
4.5 $10,000,000 Senior Note Agreement between
Amcast Industrial Corporation and Principal
Mutual Life Insurance Company dated
September 1, 1989, as amended - incorporated
by reference from Form 10-K for the year ended
August 31, 1989.
4.6 Amendment Agreement to the $10,000,000 Senior
Note Agreement between Amcast Industrial
Corporation and Principal Mutual Life Insurance
Company dated October 1, 1990, effective
August 31, 1990 - incorporated by reference from
Form 10-K for the year ended August 31, 1990.
4.7 Loan Agreement by and between the City of Fayetteville,
Arkansas, and Amcast Industrial Corporation, dated as of
December 1, 1991, for $5,050,00 City of Fayetteville,
Arkansas, variable/fixed rate demand Industrial
Development Revenue Refunding Bonds, Series 1992. +
4.8 Lease Agreement between PNC Leasing Corp., lessor, and
Amcast Industrial Corporation, lessee, dated July 15, 1992
incorporated by reference from Form 10-K for the year
ended August 31, 1993.
10 MATERIAL CONTRACTS:
10.1 Amcast Industrial Corporation Employee Share-
builder Plan effective August 26, 1987 -
incorporated by reference from Form 10-K for
the year ended August 31, 1989.
10.2 Amcast Industrial Corporation 1981 Stock
Option Plan - incorporated by reference from
Form 10-K for the year ended August 31, 1988.
10.3 Amcast Industrial Corporation Annual Incentive
Plan effective September 1, 1982 -incorporated
by reference from Form 10-K for the year ended
August 31, 1988.
10.4 Deferred Compensation Agreement for Directors
of Amcast Industrial Corporation - incorporated
by reference from Form 10-K for the year ended
August 31, 1988.
10.5 Executive Employment Agreement between Amcast
Industrial Corporation and Leo W. Ladehoff,
effective April 1, 1991 - incorporated by
reference from Form 10-Q for the quarter
ended March 3, 1991.
</TABLE>
-20-
<PAGE> 21
<TABLE>
INDEX TO EXHIBITS (cont'd)
-----------------
<CAPTION>
Exhibit Located at
Number Description Numbered Page
- - ------- -------------------------------------------------------------- -------------
<S> <C> <C>
MATERIAL CONTRACTS (cont'd)
10.6 Indemnification Agreement for Directors of
Amcast Industrial Corporation, effective
October 30, 1987 - incorporated by reference
from Form 10-Q for the quarter ended
February 28, 1988.
10.7 First Master Benefit Trust Agreement between
Amcast Industrial Corporation and Bank One,
Dayton, NA, effective March 11, 1988 -
incorporated by reference from Form 10-Q
for the quarter ended February 28, 1988.
10.8 Amcast Industrial Corporation 1989 Stock
Incentive Plan, effective October 19, 1988 -
as amended, effective December 9, 1992 -
incorporated by reference from Form 10-Q
for the quarter ended February 28, 1994.
10.9 Amcast Industrial Corporation 1989 Director
Stock Option Plan, effective October 19, 1988 -
incorporated by reference from Registration
Statement on Form S-8 (Reg. No. 33-28084)
dated April 11, 1989.
10.10 Amcast Industrial Corporation Severance
Agreements effective March 1, 1990 - as amended,
effective October 1, 1992 - incorporated by reference
from Form 10-K for the year ended August 31, 1992.
10.11 Amcast Industrial Corporation Long-Term
Incentive Plan effective September 1, 1991 -
incorporated by reference from Form 10-K for
the year ended August 31, 1992.
10.12 Amcast Industrial Corporation Nonqualified
Supplementary Benefit Plan, effective
May 29, 1991. 24
13 ANNUAL REPORT TO SECURITY HOLDERS:
13.1 Amcast Industrial Corporation Annual Report to
Shareholders for fiscal year ended August 31, 1994.
Those portions of the Annual Report as are
specifically referenced under Parts I, II, and IV of
this report are filed herein. 30
</TABLE>
-21-
<PAGE> 22
<TABLE>
INDEX TO EXHIBITS (cont'd)
-----------------
<CAPTION>
Exhibit Located at
Number Description Numbered Page
- - ------- -------------------------------------------------------------- -------------
<S> <C>
21 SUBSIDIARIES OF THE REGISTRANT:
Amcast Industrial Corporation has nine wholly-owned
subsidiaries which are included in the consolidated
financial statements of the company. Information
regarding these subsidiaries is set forth below:
Amcast Industrial Limited
Jurisdiction of Incorporation: Ontario, Canada
Name Under Which Business Is Done: Amcast Industrial Limited
Elkhart Products Corporation
Jurisdiction of Incorporation: Indiana
Name Under Which Business Is Done: Elkhart Products Corporation
WheelTek, Inc.
Jurisdiction of Incorporation: Indiana
Name Under Which Business Is Done: WheelTek, Inc.
Amcast Precision Products, Inc.
Jurisdiction of Incorporation: California
Name Under Which Business Is Done: Amcast Precision Products, Inc.
Amcast Industrial Investment Corporation
Jurisdiction of Incorporation: Delaware
Name Under Which Business Is Done: Amcast Industrial
Investment Corporation
Amcast Industrial Financial Services, Inc.
Jurisdiction of Incorporation: Ohio
Name Under Which Business is Done: Amcast Industrial
Financial Services, Inc.
Amcast Industrial Sales Corporation
Jurisdiction of Incorporation: U.S. Virgin Islands
Name Under Which Business is Done: Amcast Industrial
Sales Corporation
Amcast Automotive, Inc.
Jurisdiction of Incorporation: Michigan
Name Under Which Business is Done: Amcast Automotive, Inc.
Amcast Casting Technologies, Inc.
Jurisdiction of Incorporation: Indiana
Name Under Which Business is Done: Amcast Casting Technologies, Inc.
</TABLE>
-22-
<PAGE> 23
<TABLE>
INDEX TO EXHIBITS (cont'd)
-----------------
<CAPTION>
Exhibit Located at
Number Description Numbered Page
- - ------- -------------------------------------------------------------- -------------
<S> <C> <C>
23 CONSENTS OF EXPERTS AND COUNSEL:
23.1 Consent of Ernst & Young LLP dated
November 28, 1994, with respect to the
incorporation by reference of
their report dated October 7, 1994 into this
Annual Report (Form 10-K), the inclusion of the
financial statement schedules listed in Item 14(a)(2)
to the financial statements covered by their report
dated October 7, 1994, and material incorporated by
reference into Amcast Industrial Corporation's
Post-Effective Amendment No. 1 to Registration
Statement No. 33-2876 on Form S-8, on Registration
Statements on Form S-8 (Registration Nos. 33-18690,
33-28080, 33-28084, 33-38176 and 33-61290),
and on Registration Statement No. 33-28075 on
Form S-3 58
24 POWER OF ATTORNEY:
24.1 Powers of attorney of persons who are indicated
as having executed this Annual Report Form 10-K 59
on behalf of another.
27 FINANCIAL DATA SCHEDULE:
27.1 Article 5 of Regulation S-X Financial Data Schedule
Form 10-K for the year ended August 31, 1994 66
<FN>
+ Indicates that the document relates to a class of indebtedness that does not exceed
10% of the total consolidated assets of the company and that the company will furnish
a copy of the document to the Commission upon its request.
</TABLE>
-23-
<PAGE> 1
Exhibit 10.12
AMCAST INDUSTRIAL CORPORATION
NONQUALIFIED SUPPLEMENTARY BENEFIT PLAN
As Adopted by the Board of Directors
May 29, 1991
-24-
<PAGE> 2
<TABLE>
AMCAST INDUSTRIAL CORPORATION
NONQUALIFIED SUPPLEMENTARY BENEFIT PLAN
INDEX
<S> <C> <C>
Article I. Purpose and Definitions
1.1 Purpose . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Actuarial Equivalent . . . . . . . . . . . . . . . 1
1.3 Company . . . . . . . . . . . . . . . . . . . . . . 1
1.4 Income . . . . . . . . . . . . . . . . . . . . . . 1
1.5 Participant . . . . . . . . . . . . . . . . . . . . 1
1.6 Participant's Beneficiary . . . . . . . . . . . . . 1
1.7 Qualified Plan . . . . . . . . . . . . . . . . . . 1
Article II. Administration
2.1 Administrator . . . . . . . . . . . . . . . . . . . 1
Article III. Benefits
3.1 Qualified Plan Pension . . . . . . . . . . . . . . 2
3.2 Benefits Under the Plan . . . . . . . . . . . . . . 2
3.3 Payment of Plan Benefits . . . . . . . . . . . . . 2
3.4 Participant's Election . . . . . . . . . . . . . . 3
3.5 Limitation of Payments . . . . . . . . . . . . . . 3
Article IV. General
4.1 Amendment and Termination . . . . . . . . . . . . . 3
4.2 Vesting . . . . . . . . . . . . . . . . . . . . . . 3
4.3 Effect on Qualified Plans . . . . . . . . . . . . . 3
4.4 Non-Assignability of Right to Receive Benefits . . 3
4.5 This Plan not an Employment Contract. . . . . . . . 3
4.6 Applicable Law . . . . . . . . . . . . . . . . . . 3
4.7 Non-Funded Plan . . . . . . . . . . . . . . . . . . 4
4.8 Plan not a Qualified Plan . . . . . . . . . . . . . 4
4.9 Effect on Contractual Rights . . . . . . . . . . . 4
4.10 Severability . . . . . . . . . . . . . . . . . . . 4
4.11 Effective Date . . . . . . . . . . . . . . . . . . 4
</TABLE>
-25-
<PAGE> 3
AMCAST INDUSTRIAL CORPORATION
NONQUALIFIED SUPPLEMENTARY BENEFIT PLAN
Article I. Purpose and Definitions
1.1 Purpose - In order to permit all employees of the
Company to earn equal and full credit for all years of service to the Company
and to cause all employee's pensions to be calculated based on the employee's
total Income as an employee of the Company, the Company has adopted the
following supplemental retirement plan (the "Plan").
1.2 Actuarial Equivalent - A benefit equal in value to the
benefit for which it is substituted as determined actuarially on the basis of
such rates of interest and rates of mortality herein set forth. Actuarial
Equivalent under this Plan will be calculated assuming an investment return
based on the PBGC interest rate in effect on the first day of the year in
which the retirement occurs and the UP-1984 Mortality Table.
1.3 Company - Amcast Industrial Corporation, an Ohio
corporation, and its divisions and subsidiaries.
1.4 Income - The total compensation paid during
employment to a Participant by the Company while he or she is a Participant,
including regular pay, overtime pay, incentive payments, bonuses, commissions,
and a Participant's salary deferral contributions to the Company's 401(k)
Salary Deferral Plan and Employees Flexible Compensation Plan, but excluding
any other Employer contributions made to any "employee benefit plan" for the
Participant, such as reimbursed expenses, special awards, gifts or allowances,
severance payments, and extraordinary compensation.
1.5 Participant - All employees of the Company shall be
eligible to participate in the Plan provided that they are members of the
Amcast Merged Pension Plan, Part "A", f/k/a the Amcast Pension Plan for
Salaried Employees and whose income exceeds the amount specified in
401(a)(17) of the Federal Code.
1.6 Participant's Beneficiary - The person or persons
entitled to receive benefits under the Qualified Plan because of a
relationship with or designation by a Participant. The Participant's
Beneficiary is entitled to receive a portion of the Participant's benefits
under the Plan equal to the portion of Participant's benefits that the
Participant's Beneficiary is entitled to receive under the Qualified Plan.
1.7 Qualified Plan - The Amcast Merged Pension Plan,
Part "A", f/k/a the Amcast Pension Plan for Salaried Employees.
-26-
<PAGE> 4
Article II. Administration
2.1 Administrator - The Plan shall be administered by the
pension and benefits department of the Company.
Article III. Benefits
3.1 Qualified Plan Pension - At the time of retirement, all
Participants shall have their pensions calculated under the provisions of the
Qualified Plan, taking into account the Participant's age and years of
service at retirement, the retirement option selected by Participant, and
such other factors set forth in the Qualified Plan or any provision of
federal, state, or local law, as would affect the calculation of
Participant's benefit under the Qualified Plan. This is the amount of the
pension payments payable to Participant or Participant's Beneficiary under
the Qualified Plan.
3.2 Benefits Under the Plan
a. At the time of retirement, all Participants shall have a
calculation made as to the amount their benefits
would be under the Qualified Plan using the same
formula as described in section 3.1 hereof, but
not taking into account any reduction in
benefits or any reduction in the amount of
income or time of service used in calculating
benefits resulting from any provision of
federal, state, or local law. This is the
amount of the pension payments that would
otherwise be payable to Participant or
Participant's Beneficiary but for the reduction
resulting from federal, state, or local law.
b. In any instance where the pension payable
to the Participant or the Participant's
Beneficiary under the Qualified Plan is reduced
because of any provision of federal, state, or local
law from the amount which would otherwise have been
payable under the Qualified Plan, the Participant or
Participant's Beneficiary shall be entitled to receive
a pension under the Plan in an amount which, when
added to the amount the Participant or Participant's
Beneficiary is entitled to receive under the Qualified
Plan, results in a total amount of pension payments
payable to Participant or Participant's Beneficiary
from the Plan plus the Qualified Plan equal to the
amount which Participant or Participant's Beneficiary
would have been entitled to receive from the Qualified
Plan had there been no reduction as a result of the
provisions of federal state, or local law.
3.3 Payment of Plan Benefits - Benefits shall be payable to
Participants under the terms of either option a or option b as set forth in
this section.
a. Benefits under the Plan shall be payable at the same
times and intervals as benefits payable under the
Qualified Plan.
-27-
<PAGE> 5
b. Payment of a lump sum to Participant on Participant's
last day of work (or 10 days after the date of the
notice described in 3.4 hereof if such notice
is given by Participant's Beneficiary) of an
amount equal to the Actuarial Equivalent of
his or her pension.
3.4 Participant's Election - Participant or Participant's
Beneficiary shall be entitled to elect to receive payment of Benefits under
the provisions of either 3.3(a) or 3.3(b) hereof. Participant or
Participant's Beneficiary (in the event of Participant's death or disability)
shall designate in writing addressed to the administrator the method of
payment he or she has chosen no later than ten (10) days prior to the date of
the first payment under option 3.3(a) or the date of the total payment under
3.3(b).
3.5 Limitation of Payments - No Participant or
Participant's Beneficiary shall be entitled to any pension under the Plan
except as described in Article III.
Article IV. General
4.1 Amendment and Termination - The Plan may be altered or
terminated only by action of three-fourths (3/4) of the entire Board of
Directors of the Company at a valid meeting. Such termination shall in no
way effect, alter, or reduce any vested right of any Participant existing at
the time of the termination.
4.2 Vesting - Participant's rights under the Plan shall
vest at the time when the Participant's Income and time of service are such
that Participant would be entitled to receive a pension under the Plan if
Participant were of retirement age under the terms of the Qualified Plan and
retired under the Qualified Plan and when the Participant has completed five
years in the employ of the Company.
4.3 Effect on Qualified Plans - The adoption,
administration, amendment, or termination of the Plan shall have no effect
upon the Qualified Plan or any other of the Company's qualified plans.
4.4 Non-Assignability of Right to Receive Benefits - The
right to receive benefits under the Plan may not be anticipated, alienated,
sold, transferred, assigned, pledged, encumbered, or subjected to any charge
or legal process; and if any attempt is made to do so, or a person eligible
for any benefit becomes bankrupt, the interest under the Plan of the person
affected may be terminated by the Company, and the Committee may cause the
same to be held or applied for the benefit of such person or one or more of
his or her dependents in such manner as it deems proper.
4.5 This Plan not an Employment Contract - This Plan does
not give to any Participant the right to be continued in employment or
otherwise enlarge or affect employment status or rights.
4.6 Applicable Law - All questions pertaining to the
construction, validity, and effect of the provisions hereof are to be
determined in accordance with the laws of the State of Ohio.
-28-
<PAGE> 6
4.7 Non-Funded Plan - The entire cost of the Plan will be
paid from the general assets of the Company. It is the intent of the Company
to pay benefits under the Plan as they become due. No liability for the
payment of benefits under the Plan shall be imposed upon any officer,
director, employee, or stockholder of the Company.
4.8 Plan not a Qualified Plan - The Plan is not intended to
be a qualified pension plan or to be a benefit or welfare plan subject to
ERISA.
4.9 Effect on Contractual Rights - The Plan shall not
reduce or otherwise adversely affect any contractual right with respect to
retirement of any person who is a Participant or a Participant's Beneficiary,
or relieve the Company of any contractual obligation with respect to
retirement of any person who is a Participant or Participant's Beneficiary,
except to the extent of payments made under this Plan.
4.10 Severability - If any provisions of the Plan shall be
held illegal or invalid for any reason, said illegality or invalidity shall
not affect the remaining parts of the Plan, but this Plan shall be construed
and enforced as if said illegal or invalid provision had never been included
herein.
4.11 Effective Date - The Plan shall become effective upon
the approval and adoption of this Plan by the Board of Directors.
-29-
<PAGE> 1
EXHIBIT 13.1
MANAGEMENT'S DISCUSSION OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
($ in thousands except per share amounts)
RESULTS OF CONTINUING OPERATIONS
- - --------------------------------
Net sales were $271,856, $222,643, and $236,805 in 1994, 1993, and 1992,
respectively. In 1994, sales increased 22.1% due to a strong plumbing market
and increased demand for aluminum wheels and automotive components. Sales
decreased 6.0% in 1993, primarily due to lower unit demand for aluminum wheels
in the Engineered Components segment.
The gross profit percent was 21.8%, 22.6%, and 22.1% in 1994, 1993, and
1992, respectively. Gross profit decreased as a percent of sales in 1994,
primarily due to the underutilization of two recently completed automotive
parts plants. The higher gross profit percent in 1993, resulted from improved
pricing for copper plumbing products and lower costs for copper used in many of
the company's flow control products. These improvements were partially offset
by reduced unit volumes for copper plumbing products and lower demand for
aluminum wheels.
Selling, general and administrative expenses, as a percent of sales, were
13.3% in 1994, 14.2% in 1993, and 13.1% in 1992. Expenses decreased as a
percent of sales in 1994 as sales increased 22.1% while expenses increased
14.4% resulting from higher sales and marketing costs and, expenditures to
support business expansion activities. The primary reason for the increase, as
a percent of sales, in 1993 was due to lower sales volumes compared to 1992 as
sales decreased 6.0%.
Interest expense was $1,594, $1,266, and $2,923 in 1994, 1993, and 1992,
respectively. Average borrowings were down in 1994, however, interest expense
was higher compared to 1993 when interest was capitalized during the
construction period of two new manufacturing facilities. Interest rates were
slightly higher in 1994. In 1993, interest expense declined as a result of
lower average borrowings during the year.
-30-
<PAGE> 2
Other income was $441, $1,187, and $388 in 1994, 1993, and 1992,
respectively. Other income was higher in 1993 compared to 1994 and 1992,
primarily due to the gain realized in the fourth quarter on disposal of a
facility.
The effective tax rates for 1994, 1993, and 1992 were 34.5%, 36.0%, and
36.0%, respectively. The effective tax rate decreased in 1994 compared to 1993
primarily due to the tax benefit derived from the conversion of Castings
Technology Corporation, a 60% owned joint venture, to a partnership.
During the fourth quarter of 1993, the company elected early adoption,
effective September 1, 1992, of the Statement of Financial Accounting Standards
(SFAS) No. 106, "Employers' Accounting for Postretirement Benefits Other Than
Pensions". This statement requires companies to record a liability for
employees' accumulated postretirement benefit costs and to recognize on-going
expenses on an accrual basis. The company recognized the $6,159 pre-tax
cumulative effect of the change in accounting principle, which represents the
accumulated postretirement benefit obligation as of September 1, 1992. The
effect on net income and shareholders' equity was $3,942, or $.47 per share.
The impact on 1993 operating results, due to the adoption of SFAS 106, was not
material.
Effective August 31, 1992, the company's Board of Directors approved a plan
to divest Stanley G. Flagg & Co. (Flagg), a manufacturer of iron and brass pipe
fittings, previously reported as part of the Flow Control Products segment.
This action was prompted by unprofitable operations that were plagued by
industry over capacity and weak demand in the iron pipe fittings product line.
The company made a pretax provision of $22 million based upon the expected
proceeds of this divestiture. A significant portion of the Flagg assets,
relating to the iron and pole line hardware businesses, have been sold and,
although operating losses until disposition are greater than originally
estimated, the loss on the sale of assets and estimated liabilities are
-31-
<PAGE> 3
Exhibit 13.1
expected to be less than the amounts initially provided. Annual sales and
results of the remaining brass business are not material to the company. At
August 31, 1994, the company believes that it has provided adequately for the
effect of the disposal of the remaining assets of Flagg and the operating
losses through the date of disposal. See discontinued operation footnote on
page 24.
FLOW CONTROL PRODUCTS
- - ---------------------
Flow Control Products sales were $124,090, $110,096, and $108,306 in 1994,
1993, and 1992, respectively. Operating profits were $19,849, $15,703, and
$10,765 in 1994, 1993, and 1992, respectively. In 1994, sales increased 12.7%
while operating profits rose 26.4% due to improved margins resulting from cost
reductions and increase sales volume. In 1993, sales increased 1.7% and
operating profits rose 45.9% due to improved margins for copper plumbing
products which was partially offset by a decrease in the unit volume.
ENGINEERED COMPONENTS
- - ---------------------
Engineered Components sales were $147,766, $112,547, and $128,499 in 1994,
1993, and 1992, respectively. Operating profits were $10,034, $8,228, and
$14,780 in 1994, 1993, and 1992, respectively. In 1994, sales increased 31.3%
while operating profits increased 21.9%. The increase in sales was primarily
due to the strong customer demand for aluminum wheels and other aluminum
automotive components. Higher operating profits, primarily from wheel sales,
were partially offset by the underutilization of two new automotive parts
plants. In 1993, sales declined 12.4%, primarily due to lower demand for
aluminum wheels and deferred production schedules requested by aerospace
customers. These reductions were partially offset by increased sales of
aluminum brake and suspension system components. Operating profit declined
44.3% in 1993, primarily due to the lower sales volumes and one-time expenses
associated with consolidation of the company's California operations.
-32-
<PAGE> 4
LIQUIDITY
- - ---------
Net cash provided by operations was $28,564, $17,778, and $13,283 for the
years 1994, 1993, and 1992, respectively. In each of the three years, cash was
primarily provided by income from operations, and depreciation and
amortization.
Net cash used by investing activities was $7,834, $10,941, and $23,551 for
the years 1994, 1993, and 1992, respectively. Investments were made primarily
in additions to property, plant, and equipment.
Net cash (used) provided by financing activities were $(7,567), $(7,726),
and $11,832 for the years 1994, 1993, and 1992, respectively. In 1994 and 1993,
financing activities used cash primarily to reduce long-term debt and pay cash
dividends. In 1992, cash was provided by the sale of common stock, and these
proceeds were used to reduce long-term debt and pay cash dividends.
CAPITAL RESOURCES
- - -----------------
Capital expenditures were $15,596, $13,990, and $21,831 in 1994, 1993, and
1992, respectively. In each year, the expenditures were funded by cash provided
by operations and, additionally in 1992, with proceeds from the sale of common
stock. At August 31, 1994, the company had $5,199 of commitments for capital
expenditures to be made in 1995, primarily for the Engineered Components
segment.
Book value per common share at August 31, 1994, was $13.02, compared to
$11.81 at August 31, 1993.
The ratio of long-term debt as a percent of capital was 11.2% at August 31,
1994, down from 15.3% at August 31, 1993.
The company has $136,726 of unused borrowing capacity under the most
restrictive debt covenant relating to a credit agreement which went into effect
September 30, 1992. One million preferred shares and 6.5 million common shares
are authorized and available for future issuance. Management believes the
company has adequate resources to meet its future needs.
-33-
<PAGE> 5
Contingency. The company is subject to a range of federal, state and local
laws and regulations governing the discharge of material into the environment
or otherwise relating to the protection of the environment. The company
periodically makes capital expenditures to meet the requirements of these laws
and regulations; however, the company believes that the anticipated
expenditures for such purposes in the foreseeable future will not be material
to its financial position or its competitive position.
The company, as is normal for the industry in which it operates, is subject
to periodic environmental site investigations and inquiries. The company has
been identified as a potentially responsible party by various state agencies
and by the United States Environmental Protection Agency (U.S. EPA) under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as amended, for costs associated with eight U.S. EPA led multi-party
"superfund" sites and three state environmental agency led remediation sites.
While the company could be found jointly and severally liable at a number of
these sites, the company, in each case, is contesting any responsibility or
believes that its liability will not be material because of the nature of the
waste involved or the limited amount of waste generated by the company which
was allegedly disposed of at these sites. With respect to one such site located
in Ironton, Ohio, another potentially responsible party has brought an action
seeking contribution from the company for a portion of the total response and
remediation costs, which the plaintiff has claimed may exceed $20 million. The
company believes that its ultimate equitable share, if any, of any liability
for cleanup costs at this site will not be material.
-34-
<PAGE> 6
REPORT OF ERNST & YOUNG LLP
INDEPENDENT AUDITORS
Shareholders and Board of Directors
Amcast Industrial Corporation
Dayton, Ohio
We have audited the accompanying consolidated statements of financial condition
of Amcast Industrial Corporation and subsidiaries as of August 31, 1994 and
1993 and the related consolidated statements of operations, shareholders'
equity, and cash flows for each of the three years in the period ended August
31, 1994. These financial statements are the responsibility of the company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Amcast
Industrial Corporation and subsidiaries at August 31, 1994 and 1993, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended August 31, 1994, in conformity with generally
accepted accounting principles.
As discussed in the Postretirement Health Care and Life Insurance Benefits
note to the consolidated financial statements, in 1993 the company adopted the
provisions of Statement of Financial Accounting Standards No. 106, "Employers'
Accounting for Postretirement Benefits Other Than Pensions."
Ernst & Young LLP
Dayton, Ohio
October 7, 1994
/s/Ernst & Young LLP
--------------------
-36-
<PAGE> 7
<TABLE>
SELECTED DATA
($ in thousands except per common share and statistical data)
<S> <C> <C> <C> <C> <C>
FINANCIAL DATA 1994 1993 1992 1991 1990
Net sales . . . . . . . . . . . . . . . . . $271,856 $222,643 $236,805 $220,643 $227,306
Gross profit . . . . . . . . . . . . . . . . 59,258 50,425 52,247 47,271 46,739
Gross profit percent . . . . . . . . . . . . 21.8% 22.6% 22.1% 21.4% 20.6%
Income (loss) from continuing operations
before taxes . . . . . . . . . . . . . . . 22,067 18,831 18,740 11,944 (8,697)*
Income (loss) from continuing operations . . 14,454 12,052 11,994 7,405 (6,472)
Working capital . . . . . . . . . . . . . . . 48,590 36,097 32,525 45,287 41,794
Total assets . . . . . . . . . . . . . . . . 194,161 176,537 173,774 175,211 184,922
Long-term debt . . . . . . . . . . . . . . . 13,910 17,929 22,276 40,424 41,198
PER COMMON SHARE DATA
Income (loss) from continuing operations . . $ 1.72 $ 1.44 $ 1.66 $ 1.14 $ (0.95)
Weighted average number of common
shares outstanding (in thousands) . . . . . 8,425 8,347 7,223 6,487 6,790
Dividends declared . . . . . . . . . . . . . $ .49 $ .48 $ .48 $ .48 $ .48
Book Value . . . . . . . . . . . . . . . . . 13.02 11.81 11.37 10.80 10.10
STATISTICAL DATA
Current ratio . . . . . . . . . . . . . . . . 2.0 1.9 1.8 2.0 1.8
Long-term debt as a percent of capital . . . 11.2% 15.3% 19.1% 36.9% 37.9%
Average number of employees . . . . . . . . . 2,100 1,900 1,900 1,900 2,100
<FN>
*Includes restructuring provision of $18,900.
</TABLE>
-35-
<PAGE> 8
<TABLE>
CONSOLIDATED STATEMENTS OF OPERATIONS
($ in thousands except per share amounts)
<CAPTION>
Year Ended August 31
1994 1993 1992
<S> <C> <C> <C>
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . $271,856 $222,643 $236,805
Cost and expenses:
Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . 212,598 172,218 184,558
Selling, general and administrative expenses . . . . . . . . . 36,038 31,515 30,972
Interest expense . . . . . . . . . . . . . . . . . . . . . . . 1,594 1,266 2,923
Other income, net . . . . . . . . . . . . . . . . . . . . . . (441) (1,187) (388)
-------- -------- --------
249,789 203,812 218,065
-------- -------- --------
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES 22,067 18,831 18,740
Income taxes--continuing operations . . . . . . . . . . . . . . 7,613 6,779 6,746
-------- -------- --------
INCOME FROM CONTINUING OPERATIONS 14,454 12,052 11,994
Discontinued operation, net of taxes:
Loss from operation . . . . . . . . . . . . . . . . . . . . . 3,307
Estimated loss on disposal . . . . . . . . . . . . . . . . . . 14,520
-------- -------- --------
INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING
PRINCIPLE 14,454 12,052 (5,833)
Cumulative effect of change in accounting for postretirement
benefits other than pensions, net of taxes . . . . . . . . . . (3,942)
-------- -------- --------
NET INCOME (LOSS) $ 14,454 $ 8,110 $ (5,833)
======== ======== ========
Income (loss) per share:
Continuing operations . . . . . . . . . . . . . . . . . . . . $ 1.72 $ 1.44 $ 1.66
Discontinued operation . . . . . . . . . . . . . . . . . . . . (2.47)
Cumulative effect of a change in accounting principle . . . . (.47)
-------- -------- --------
Net income (loss) per share . . . . . . . . . . . . . . . . . $ 1.72 $ .97 $ (.81)
======== ======== ========
<FN>
See notes to consolidated financial statements
</TABLE>
-37-
<PAGE> 9
<TABLE>
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
($ in thousands)
<CAPTION>
August 31
1994 1993
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 15,414 $ 2,251
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,400 33,764
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,469 34,572
Deferred tax benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,430 1,500
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,713 2,826
----------- ----------
TOTAL CURRENT ASSETS 97,426 74,913
PROPERTY, PLANT, AND EQUIPMENT
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,940 1,586
Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,130 20,458
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110,287 99,768
Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,828 12,809
----------- ----------
149,185 134,621
Less allowances for depreciation . . . . . . . . . . . . . . . . . . . . . . . . 75,531 64,412
----------- ----------
73,654 70,209
NET ASSETS OF DISCONTINUED OPERATION . . . . . . . . . . . . . . . . . . . . . . . 12,389 19,980
OTHER ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,692 11,435
----------- ----------
$ 194,161 $ 176,537
=========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 27,169 $ 18,050
Compensation and related items . . . . . . . . . . . . . . . . . . . . . . . . . 9,066 8,676
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,482 6,728
Current portion of long-term debt. . . . . . . . . . . . . . . . . . . . . . . . 4,019 4,356
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,100 1,006
----------- ----------
TOTAL CURRENT LIABILITIES 48,836 38,816
LONG-TERM DEBT--less current portion . . . . . . . . . . . . . . . . . . . . . . . 13,910 17,929
DEFERRED INCOME TAXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,024 1,897
DEFERRED LIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,228 18,975
SHAREHOLDERS' EQUITY
Preferred shares, without par value:
Authorized--1,000,000 shares
Issued--None
Common shares, at stated value:
Authorized--15,000,000 shares
Issued--8,457,896 shares, 8,383,342 shares in 1993 . . . . . . . . . . . . . . 8,458 8,383
Capital in excess of stated value . . . . . . . . . . . . . . . . . . . . . . . 62,912 62,047
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,793 28,577
Cost of 3,863 common shares in treasury . . . . . . . . . . . . . . . . . . . . (87)
----------- ---------
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110,163 98,920
---------- ----------
$ 194,161 $ 176,537
=========== ==========
<FN>
See notes to consolidated financial statements
</TABLE>
-38-
<PAGE> 10
<TABLE>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
($ in thousands)
<CAPTION>
Capital in Common
Common Excess of Retained Shares in
Shares Stated Value Earnings Treasury Total
<S> <C> <C> <C> <C> <C>
BALANCE AT SEPTEMBER 1, 1991 . . . . . . . . . . . . $7,470 $38,562 $34,096 $(10,871) $69,257
Net Loss . . . . . . . . . . . . . . . . . . . . (5,833) (5,833)
Cash dividends declared, $.48 per share . . . . (3,561) (3,561)
Stock options exercised . . . . . . . . . . . . (38) 1,804 1,766
Proceeds from sale of 1,700,000 shares to
public, net of offering costs . . . . . . 900 22,723 8,408 32,031
Tax benefit from stock options exercised . . . . 759 759
Other . . . . . . . . . . . . . . . . . . . . . (7) 8 1
------- ------- ------- -------- --------
BALANCE AT AUGUST 31, 1992 . . . . . . . . . . . . . 8,370 62,006 24,695 (651) 94,420
Net income . . . . . . . . . . . . . . . . . . . 8,110 8,110
Cash dividends declared, $.48 per share . . . . (4,014) (4,014)
Stock options exercised . . . . . . . . . . . . 13 61 564 638
Tax benefit from stock options exercised . . . . (10) (10)
Other . . . . . . . . . . . . . . . . . . . . . (10) (214) (224)
------- ------- ------- -------- --------
BALANCE AT AUGUST 31, 1993 . . . . . . . . . . . . . 8,383 62,047 28,577 (87) 98,920
Net income . . . . . . . . . . . . . . . . . . . 14,454 14,454
Cash dividends declared, $.49 per share . . . . (4,134) (4,134)
Stock options exercised . . . . . . . . . . . . 75 698 87 860
Tax benefit from stock options exercised . . . . 167 167
Other . . . . . . . . . . . . . . . . . . . . . (104) (104)
------- ------- ------- -------- --------
BALANCE AT AUGUST 31, 1994 . . . . . . . . . . . . . $8,458 $62,912 $38,793 $ $110,163
======= ======= ======= ======== ========
<FN>
See notes to consolidated financial statements
</TABLE>
-39-
<PAGE> 11
<TABLE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
($ in thousands )
<CAPTION>
Year Ended August 31
1994 1993 1992
<S> <C> <C> <C>
OPERATING ACTIVITIES:
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . $14,454 $ 8,110 $(5,833)
Depreciation and amortization . . . . . . . . . . . . . . . . . 12,812 12,010 13,639
Provision for discontinued operation . . . . . . . . . . . . . . 22,000
Cumulative effect of change in accounting principle . . . . . . 6,159
Deferred liabilities . . . . . . . . . . . . . . . . . . . . . . 380 (1,183) (9,310)
Loss (gain) on property, plant and equipment disposals . . . . . 46 (850) 211
------- -------- -------
27,692 24,246 20,707
Changes in assets and liabilities:
Accounts receivable . . . . . . . . . . . . . . . . . . . . . (4,636) 1,245 (1,251)
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . (3,897) (1,757) (6,492)
Deferred tax benefit . . . . . . . . . . . . . . . . . . . . . 70 39 (724)
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . (887) (1,622) (86)
Prepaid pension costs . . . . . . . . . . . . . . . . . . . . 336 548 323
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . (471) (2,324) (516)
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . 9,119 (4,160) 2,018
Accrued liabilities . . . . . . . . . . . . . . . . . . . . . 1,238 1,563 (696)
------- -------- -------
NET CASH PROVIDED BY OPERATIONS 28,564 17,778 13,283
INVESTING ACTIVITIES:
Proceeds from property, plant, and equipment disposals . . . . . 171 1,907 242
Additions to property, plant, and equipment . . . . . . . . . . (15,596) (13,990) (23,793)
Decrease in net assets of discontinued operations . . . . . . . 7,591 1,142
------- -------- -------
NET CASH USED BY INVESTING ACTIVITIES (7,834) (10,941) (23,551)
FINANCING ACTIVITIES:
Proceeds from sale of stock, net . . . . . . . . . . . . . . . . 32,031
Proceeds from exercise of stock options . . . . . . . . . . . . 1,027 628 2,525
Reduction in long-term debt . . . . . . . . . . . . . . . . . . (4,019) (4,347) (18,141)
Short-term borrowings and current portion of long-term debt . . (337) 231 (1,023)
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,134) (4,014) (3,561)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (104) (224) 1
------- -------- -------
NET CASH (USED) PROVIDED BY FINANCING ACTIVITIES (7,567) (7,726) 11,832
------- -------- -------
Net change in cash and cash equivalents . . . . . . . . . . . . . . 13,163 (889) 1,564
Cash and cash equivalents at beginning of period . . . . . . . . . 2,251 3,140 1,576
------- -------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $15,414 $ 2,251 $ 3,140
<FN> ======= ======== =======
See notes to consolidated financial statements
</TABLE>
-40-
<PAGE> 12
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
($ in thousands except per share data)
ACCOUNTING POLICIES
THE CONSOLIDATED FINANCIAL STATEMENTS include the accounts of the company and
its subsidiaries. Intercompany transactions have been eliminated.
CASH AND CASH EQUIVALENTS include amounts on deposit with financial
institutions and investments maturing within 90 days.
ACCOUNTS RECEIVABLE are stated net of allowances for doubtful accounts of $147
at August 31, 1994, and $172 at August 31, 1993.
INVENTORIES are valued at the lower of cost or market using the last-in,
first-out (LIFO) and the first-in, first-out (FIFO) methods.
PROPERTY, PLANT, AND EQUIPMENT are carried at cost. Expenditures for
significant renewals and improvements are capitalized. Repairs and maintenance
are charged to expense as incurred.
DEPRECIATION is computed on the straight-line method. The amortization periods
represent the estimated useful lives of the assets.
DEFERRED INCOME TAXES are provided for temporary differences between financial
and tax reporting in accordance with the liability method under the provisions
of Financial Accounting Standard No. 109, "Accounting for Income Taxes".
NET INCOME PER SHARE is computed on the weighted average number of common
shares outstanding during each year. The exercise of outstanding options, which
are common stock equivalents, would cause no material dilution.
-41-
<PAGE> 13
DISCONTINUED OPERATION
Effective August 31, 1992, the company adopted a plan to sell Stanley G. Flagg
& Co. (Flagg), a part of the Flow Control segment. Accordingly, Flagg is
reported as a discontinued operation.
Net assets of the discontinued operation at August 31, 1994 and 1993 consist
of current assets and the estimated net realizable value of plant, property,
and equipment amounting to $13,656 and $24,024 respectively, less current
liabilities of $1,267 and $4,044 respectively. Annual sales of the remaining
brass business are less than 4% of consolidated sales and operating results are
nominal.
In 1992, the estimated loss on the disposal of Flagg was $14,520, net of
taxes of $7,480, consisting of an estimated loss on disposal of the business of
$12,342 and a provision of $2,178 for anticipated operating losses until
disposal. Summary operating results of the discontinued operation for the
fiscal year ended August 31, 1992 are as follows:
1992
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . $51,288
Intrasegment Sales . . . . . . . . . . . . . . . . . . . 3,672
Loss before Tax . . . . . . . . . . . . . . . . . . . . . 5,167
Tax Benefit . . . . . . . . . . . . . . . . . . . . . . . 1,860
Net Loss . . . . . . . . . . . . . . . . . . . . . . . . 3,307
-42-
<PAGE> 14
<TABLE>
INVENTORIES
The major components of inventories as of August 31 are:
<CAPTION>
1994 1993
<S> <C> <C>
Finished products . . . . . . . . . . . . . . . . . . . . . . . $21,234 $19,162
Work in process . . . . . . . . . . . . . . . . . . . . . . . . 13,121 10,776
Raw materials and supplies . . . . . . . . . . . . . . . . . . 10,435 7,207
------- -------
44,790 37,145
Less amount to reduce certain inventories to LIFO value . . . . 6,321 2,573
------- -------
$38,469 $34,572
======= =======
</TABLE>
Inventories reported on the FIFO method were $5,435 and $4,488 at August 31,
1994 and 1993, respectively. The estimated replacement cost of inventories is
the amount reported before the LIFO reserve.
-43-
<PAGE> 15
OTHER ASSETS
The major components of Other Assets as of August 31 are:
1994 1993
Properties held for resale . . . . . . . . . $ 553 $ 579
Technical and product programs . . . . . . . 1,419 2,200
Goodwill . . . . . . . . . . . . . . . . . . 2,774 2,860
Other assets . . . . . . . . . . . . . . . . 5,946 5,796
------- -------
$10,692 $11,435
======= =======
Properties held for resale reflect the estimated realizable values of the
fixed assets of closed facilities. The fair market value of technical and
product programs, as determined by an independent appraiser, were recognized at
the date of acquisition of certain businesses. The excess of cost over the
fair market value of the businesses acquired is reflected as goodwill. These
assets are being amortized on a straight-line basis over 10 and 40 years.
Accumulated amortization at August 31, 1994 and 1993 was $8,223 and $7,347,
respectively.
-44-
<PAGE> 16
LONG-TERM DEBT AND CREDIT ARRANGEMENTS
The following table summarizes the company's borrowings at August 31:
1994 1993
Senior notes . . . . . . . . . . . . $10,964 $14,696
Industrial revenue bonds . . . . . . 6,965 7,589
------- -------
17,929 22,285
Less current portion . . . . . . . . 4,019 4,356
------- -------
LONG-TERM DEBT $13,910 $17,929
======= =======
Senior notes consist of two agreements with interest rates of 9.32% and 9%.
The notes call for periodic principal payments and mature June 5, 1996, and
September 15, 1999, respectively.
Industrial revenue bonds consist of various issues at fixed and variable
interest rates, ranging from 2.5% to 5%. These bonds call for principal
payments at various dates through 2004.
The company has a $40,000 credit agreement extending through September 1,
1997. There were no outstanding borrowings under this credit agreement at
August 31, 1994. Interest on borrowings under this agreement is based, at the
company's option, on the prime rate, the CD rate plus a premium, or the
euro-dollar rate plus a premium. Premiums are subject to company performance
measured on a quarterly basis, and range from 1/2% to 7/8%. A commitment fee of
1/4% is payable on the unused portion of the credit line.
Debt covenants require the company to maintain certain working capital, debt
and equity ratios. Other provisions limit the aggregate amount of certain
defined payments including purchase of company stock and cash dividends. At
August 31, 1994, all retained earnings were available for the payment of
dividends.
The obligations in connection with industrial revenue bonds and certain
notes included in long-term debt are collateralized by property, plant, and
equipment with a net book value of $3,673 and $4,813 at August 31, 1994 and
1993, respectively.
The company has short-term lines of credit totaling $25,000. These lines
were unused at August 31, 1994 and require no material compensating balances or
commitment fees.
Long-term debt maturities for each of the next five years are $4,019 in
1995, $4,023 in 1996, $1,105 in 1997, $1,107 in 1998, and $1,050 in 1999.
No interest was capitalized in 1994. Capitalized interest was $878 and $354
in 1993 and 1992, respectively. Interest paid was $1,705, $2,230, and $3,488 in
1994, 1993, and 1992, respectively.
-45-
<PAGE> 17
DEFERRED LIABILITIES
Deferred liabilities include the noncurrent portion of retirement,
compensation, medical benefits, and estimated future payouts under the
company's self-insured workers' compensation program. These liabilities
primarily relate to the company's provisions for restructuring operations, the
discontinued operation, and postretirement benefits other than pensions.
Significant noncurrent restructuring liabilities for medical and workers'
compensation costs were $2,800 and $4,100 at August 31, 1994, and August 31,
1993, respectively; consolidation and disposition of operations were $2,100 and
$5,600, respectively at August 31, 1994 and August 31, 1993. Postretirement
benefits other than pensions were $5,564 and $6,159 at August 31, 1994 and
August 31, 1993, respectively. These accruals are not deductible for income tax
purposes until paid and are therefore, accounted for as temporary differences
in the company's tax provision.
-46-
<PAGE> 18
STOCK OPTIONS
The company has two active stock option plans.
The 1981 Stock Option Plan was approved by shareholders of the company on
December 16, 1981 and amended by the shareholders on December 18, 1985. The
plan provided for the granting of a maximum of 400,000 options to purchase
common shares to key employees of the company and its subsidiaries. The option
price per share may not be less than the fair market value of a share on the
date the option is granted, and the maximum term of an option may not exceed
ten years. Options granted under the plan may include related stock
appreciation rights. Granting of options under this plan expired on October
13, 1991.
The 1989 Stock Incentive Plan was approved by shareholders of the company on
December 14, 1988 and amended by the shareholders on December 9, 1992. The
plan provides for the granting of a maximum of 800,000 stock options, stock
appreciation rights, performance awards, and restricted stock awards to key
employees of the company and its subsidiaries. The option price per share may
not be less than the fair market value of a share on the date the option is
granted, and the maximum term of an option may not exceed ten years.
The 1989 Director Stock Option Plan was approved by the shareholders of the
company on December 14, 1988. The plan provides for the granting of a maximum
of 120,000 nonqualified stock options. The option price per share is equal to
the fair market value of a company share on the date of grant. The term of
each option is five years, and an option first becomes exercisable one year
after the date of grant. Under the plan, each person serving as a director of
the company on the first business day of January of each year, who is not
employed by the company, i.e., an "outside director," will automatically be
granted 1,500 options.
Information regarding the company's stock option plans is summarized below:
<TABLE>
<CAPTION>
1981 1989 1989
Stock Stock Director Stock
Option Plan Incentive Plan Option Plan
<S> <C> <C> <C>
Shares under option:
Outstanding at September 1, 1991 . . . . . 141,214 255,000 36,000
Granted . . . . . . . . . . . . . . . . 138,821 12,000
Exercised . . . . . . . . . . . . . . . (108,382) (107,550) (3,000)
Canceled . . . . . . . . . . . . . . . . (2,000) (23,187)
-------- -------- --------
Outstanding at August 31, 1992 . . . . . . 30,832 263,084 45,000
Granted . . . . . . . . . . . . . . . . 102,623 12,000
Exercised . . . . . . . . . . . . . . . (23,832) (46,174) (10,500)
Canceled . . . . . . . . . . . . . . . .
-------- -------- --------
Outstanding At August 31, 1993 . . . . . . 7,000 319,533 46,500
Granted . . . . . . . . . . . . . . . . 97,932 10,500
Exercised . . . . . . . . . . . . . . . (7,000) (65,009) (15,000)
Canceled . . . . . . . . . . . . . . . . (11,129)
-------- -------- --------
Outstanding At August 31, 1994 . . . . . . 341,327 42,000
======== ======== ========
Options available to grant at August 31, 1994 239,940 49,500
======== ======== ========
Average option price per share:
At August 31, 1992 . . . . . . . . . . . . $ 11.73 $ 11.29 $ 13.21
AT August 31, 1993 . . . . . . . . . . . . 12.75 12.81 14.37
AT August 31, 1994 . . . . . . . . . . . . 14.95 16.69
Options exercisable:
At August 31, 1992 . . . . . . . . . . . . 30,832 141,450 33,000
At August 31, 1993 . . . . . . . . . . . . 7,000 216,910 34,500
At August 31, 1994 . . . . . . . . . . . . 243,395 31,500
Average price of options exercised:
Year Ended August 31, 1992 . . . . . . . . $ 11.40 $ 8.93 $ 12.66
Year Ended August 31, 1993 . . . . . . . . 11.43 9.44 11.04
Year Ended August 31, 1994 . . . . . . . . 12.75 11.78 12.66
</TABLE>
-47-
<PAGE> 19
LEASES
The company has a number of operating lease agreements primarily involving
machinery, physical distribution, and computer equipment. Certain of these
leases contain renewal or purchase options which vary by lease. These leases
are noncancelable and expire on dates through 1999.
Rent expense for continuing operations was $5,234, $2,404, and $2,317 for
the years ended August 31, 1994, 1993, and 1992, respectively.
The following is a schedule by year of future minimum rental payments
required under the operating leases that have initial or remaining
noncancelable lease terms in excess of one year as of August 31, 1994:
1995 . . . . . . . . . . . . . . . . . . . $ 4,395
1996 . . . . . . . . . . . . . . . . . . . 3,901
1997 . . . . . . . . . . . . . . . . . . . 3,394
1998 . . . . . . . . . . . . . . . . . . . 7,983
1999 . . . . . . . . . . . . . . . . . . . 93
-------
TOTAL MINIMUM LEASE PAYMENTS . . . . . . . $19,766
=======
-48-
<PAGE> 20
PREFERRED SHARE PURCHASE RIGHTS
The company has a Shareholder Rights Plan pursuant to which holders of the
company's common shares receive a dividend of one preferred share purchase
right (collectively, the "Rights") for each common share held. The Rights
contain features which, under defined circumstances, allow holders to buy
shares at a bargain price. The Rights will expire on February 28, 1998. The
Rights are not presently exercisable and trade in tandem with the common
shares. The Rights become exercisable following the close of business on the
tenth day after a public announcement that a person or group has acquired 20%
or more of the common shares of the company or a public announcement or
commencement of a tender or exchange offer which would result in ownership of
30% or more of the common shares of Amcast. It is expected that the Rights will
begin to trade independently of the company's common shares at that time.
The company may redeem the Rights for 1 cent per Right any time prior to the
close of business on the tenth day following the day that a 20% position is
acquired and under certain circumstances thereafter, including certain
transactions not involving a 20% shareholder of the company.
-49-
<PAGE> 21
COMMITMENTS AND CONTINGENCIES
At August 31, 1994, the company has committed to capital expenditures of $5,199
in 1995.
The company is involved in various legal proceedings normally encountered in
the ordinary course of business. The primary issues relate to environmental and
patent infringement matters. Management believes the company's liability for
these matters will not have a material adverse effect on the financial
condition of the company. A more detailed description of these matters may be
found in Management's Discussion of Financial Condition and Results of
Operations under Capital Resources.
-50-
<PAGE> 22
PENSION PLANS
The company has a noncontributory defined benefit pension plan covering
substantially all employees. The plan covers salaried employees and provides
pension benefits that are based on years of credited service, employee
compensation during years preceding retirement, and the primary social security
benefit. The plan also covers hourly employees and provides pension benefits of
stated amounts for each year of credited service. The company's policy is to
fund the annual amount required by the Employee Retirement Income Security Act
of 1974. Plan assets consist of U.S. Treasury bonds and notes, U.S.
governmental agency issues, corporate bonds, and common stocks. The plan held
350,000 common shares of the company at August 31, 1994 (9.0% of plan assets)
and 1993 (7.2% of plan assets).
The company also sponsors a deferred compensation profit sharing plan for
the benefit of substantially all salaried employees. The company provides a 15%
match on employee contributions up to 6% of eligible compensation and a
supplemental saving match from 1% to 35% based on the company achieving a
minimum return on shareholders' equity and subject to IRS limitations.
The company participates in a multiemployer plan which provides defined
benefits to certain bargaining unit employees.
The following table sets forth the funded status and the amounts recognized
in the consolidated statements of financial condition for the company's defined
benefit plan at August 31:
<TABLE>
<CAPTION>
1994 1993
<S> <C> <C>
Actuarial present value of benefit obligation:
Vested benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (78,127) $(80,582)
========= ========
Accumulated benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (78,901) $(82,035)
========= ========
Projected benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (82,654) $(86,199)
Plan assets at fair value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82,986 88,889
--------- --------
Overfunded projected benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . 332 2,690
Unrecognized net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,847 147
Unrecognized prior service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,020 2,503
Unrecognized transition (asset)
being recognized over a minimum of 15 years . . . . . . . . . . . . . . . . . . . . . . (4,183) (4,741)
--------- --------
Assets in excess of accumulated
benefits recognized in Other Assets . . . . . . . . . . . . . . . . . . . . . . . . . . $ 16 $ 599
========= ========
</TABLE>
A summary of the components of net periodic pension cost for the defined
plan in 1994, 1993, and 1992, and the total amounts charged to expense for the
defined contribution and multiemployer plans follows:
<TABLE>
<CAPTION>
1994 1993 1992
<S> <C> <C> <C>
Defined benefit plan:
Service cost of current period . . . . . . . . . . . . . . . . . . . . . . $ 1,315 $ 1,278 $ 1,257
Interest cost on projected benefit obligation . . . . . . . . . . . . . . 6,289 6,466 6,736
Actual return on plan assets . . . . . . . . . . . . . . . . . . . . . . . (1,798) (10,159) (10,051)
Net amortization and deferral . . . . . . . . . . . . . . . . . . . . . . (5,320) 2,963 2,380
--------- --------- ---------
Net pension cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 486 548 322
Defined contribution plan . . . . . . . . . . . . . . . . . . . . . . . . . . 410 301 348
Multiemployer pension plan . . . . . . . . . . . . . . . . . . . . . . . . . 197 180 184
--------- --------- ---------
TOTAL COST $ 1,093 $ 1,029 $ 854
========= ========= =========
Assumed rates of return:
Weighted average discount rate . . . . . . . . . . . . . . . . . . . . . . 8.0% 7.5% 8.5%
Rate of future compensation increase . . . . . . . . . . . . . . . . . . . 4.7% 4.7% 5.2%
Long-term return on assets:
Dedicated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.5% 8.5% 9.5%
Nondedicated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.0% 10.0% 10.5%
</TABLE>
-51-
<PAGE> 23
POSTRETIREMENT HEALTH CARE AND LIFE INSURANCE BENEFITS
The company provides health care and life insurance benefits to designated
salary and hourly employees who participate in a defined benefit pension plan
and who retired prior to January 1, 1992. The plan coordinates with Medicare
and requires employee contributions. The company also provides similar benefits
to certain employees, represented by bargaining units, who retire before
attaining age 65 and meet certain minimum service requirements. Benefits for
the bargaining unit employees terminate when the retiree attains age 65. The
company funds the postretirement benefits on a cash basis.
In the fourth quarter of 1993, the company elected to adopt Statement of
Financial Accounting Standards (SFAS) No.106, "Employers' Accounting for
Postretirement Benefits Other Than Pensions", effective September 1, 1992. The
statement requires the cost of these benefits to be recognized during the
employee's active working career rather than expensed when paid as had been the
prior practice.
The cumulative effect of adopting SFAS 106 using the immediate recognition
method as of September 1, 1992, was a charge to earnings of $3,942, net of
$2,217 deferred income tax benefit. The adoption of SFAS 106 had no material
effect on 1993 operating results.
Accumulated postretirement benefit obligation recognized in 1994 and 1993:
<TABLE>
<CAPTION>
1994 1993
<S> <C> <C>
Retirees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,497 $ 3,122
Fully eligible active plan participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,718 2,609
Other active employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 292 428
--------- --------
5,507 6,159
Deferred gain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 358
--------- --------
$ 5,865 $ 6,159
========= ========
</TABLE>
In prior years, health care and life insurance benefits for retired
employees of closed facilities were provided for at the time the related
facility was closed. The accrued postretirement benefit obligation for these
retirees at August 31, 1994 was $2,800.
<TABLE>
<CAPTION>
Net periodic postretirement benefit expense for 1994 and 1993 includes the following:
1994 1993
<S> <C> <C>
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 28 $ 40
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 460 447
--------- --------
$ 488 $ 487
========= ========
</TABLE>
The actuarial assumptions used to determine 1994 and 1993 costs and benefit
obligation includes a discount rate of 8.0% and 7.5%, respectively. An assumed
rate of future increase in per capita cost of health care benefits (health care
trend rates) was 11% in 1994 and 12% in 1993, decreasing gradually to 5% by the
year 2000. Increasing the health care trend rate by one percentage point would
increase the accumulated postretirement benefit obligation $489 and would
increase the 1994 postretirement benefit cost $24.
-52-
<PAGE> 24
<TABLE>
INCOME TAXES FROM CONTINUING OPERATIONS
The provisions for income taxes are as follows:
<CAPTION>
1994 1993 1992
<S> <C> <C> <C>
Currently payable
State and local . . . . . . . . . . . . . . . . . . $ 466 $ 14 $ 312
Federal . . . . . . . . . . . . . . . . . . . . . . 3,962 2,269 4,794
Deferred
State and local . . . . . . . . . . . . . . . . . . (100) 100
Federal . . . . . . . . . . . . . . . . . . . . . . 3,285 4,396 1,640
------ ------ ------
$7,613 $6,779 $6,746
====== ====== ======
Reconciliations of income taxes computed by applying the statutory federal income tax rate to the provisions for
income taxes are as follows:
Federal income tax at statutory rate . . . . . . . . $7,723 $6,528 $6,372
State income taxes . . . . . . . . . . . . . . . . . 238 74 206
Other. . . . . . . . . . . . . . . . . . . . . . . . (348) 177 168
------ ------ ------
$7,613 $6,779 $6,746
====== ====== ======
The deferred tax effect of temporary differences between financial and tax reporting is as follows:
Depreciation . . . . . . . . . . . . . . . . . . . . $ 628 $ 672 $ (409)
Restructuring . . . . . . . . . . . . . . . . . . . . 518 646 1,192
Discontinued operation . . . . . . . . . . . . . . . 2,493 1,882
Start-up costs . . . . . . . . . . . . . . . . . . . (137) 1,323
Other . . . . . . . . . . . . . . . . . . . . . . . . (317) (27) 857
------ ------ ------
$3,185 $4,496 $1,640
====== ====== ======
</TABLE>
The company has an alternative minimum tax credit of $975 available to offset
future tax payments. Income taxes paid totaled $3,347, $2,474, and $4,174 in
1994, 1993, and 1992, respectively.
-53-
<PAGE> 25
SUPPLEMENTARY EARNINGS PER SHARE
On April 7, 1992, the company completed the sale of 1,700,000 shares of its
common stock in a public offering. The proceeds of the sale were used to repay
borrowings under the company's revolving credit agreement, and short-term lines
of credit, and to fund construction and the purchase of equipment for two new
manufacturing facilities.
If the common stock offering had occurred on September 1, 1991, and excess
proceeds were invested, 1992 earnings (loss) per share, based on 8,280,000
average shares outstanding, would have been $1.53 on continuing operations and
$(2.15) on the discontinued operation.
-54-
<PAGE> 26
MAJOR CUSTOMERS AND CREDIT CONCENTRATION
The company sells products to customers primarily in the United States. The
company performs ongoing credit evaluations of customers, and generally does
not require collateral. Allowances are maintained for potential credit losses
and such losses have been within management's expectations.
On August 31, 1994, trade receivables from the domestic automotive industry
were $15,111 and $17,652 was due from the construction industry.
Sales to Engineered Components' largest customer, General Motors
Corporation, were $89,300, $60,000, and $80,400 for the years ended August 31,
1994, 1993, and 1992, respectively. Trade receivables from General Motors
Corporation on August 31, 1994, were $10,175 and were current. No other single
customer accounted for a material portion of trade receivables.
-55-
<PAGE> 27
BUSINESS SEGMENTS
The company has identified its business segments as Flow Control Products and
Engineered Components.
Through the Flow Control Products and Engineered Components segments, the
company serves the construction, automotive, industrial, and aviation/defense
sectors of the economy. See Corporate Profile on the inside front cover and
pages 4 through 15 for a review of the major products produced.
Flow Control Products' sales of pipe fittings amounted to $92,532, $80,156,
and $79,547 in 1994, 1993 and 1992, respectively. Sales of aluminum products
to the automotive industry by Engineered Components amounted to $111,104,
$76,873, and $89,335 in 1994, 1993, and 1992, respectively. Export sales and
sales by geographic area were not material.
<TABLE>
<CAPTION>
INCOME FROM CONTINUING
NET SALES OPERATIONS BEFORE TAXES
1994 1993 1992 1994 1993 1992
<S> <C> <C> <C> <C> <C> <C>
Flow Control Products . . . . . . . . $ 124,090 $110,096 $108,306 $19,849 $15,703 $ 10,765
Engineered Components . . . . . . . . 147,766 112,547 128,499 10,034 8,228 14,780
Corporate . . . . . . . . . . . . . . (6,222) (3,834) (3,882)
Interest Expense . . . . . . . . . . (1,594) (1,266) (2,923)
--------- -------- -------- -------- -------- --------
$ 271,856 $222,643 $236,805 $22,067 $18,831 $ 18,740
========= ======== ======== ======== ======== ========
IDENTIFIABLE ASSETS DEPRECIATION AND AMORTIZATION
Flow Control Products . . . . . . . . $ 65,564 $ 61,753 $ 62,569 $ 3,913 $ 3,947 $ 3,824
Engineered Components . . . . . . . . 97,798 89,061 83,371 8,707 7,813 7,088
Corporate . . . . . . . . . . . . . . 18,410 5,743 6,712 192 250 290
--------- -------- --------
Continuing Operations . . . . . . . . 181,772 156,557 152,652
Discontinued Operation . . . . . . . 12,389 19,980 21,122
--------- -------- -------- -------- -------- --------
$ 194,161 $176,537 $173,774 $12,812 $12,010 $ 11,202
========= ======== ======== ======== ======== ========
CAPITAL EXPENDITURES
Flow Control Products . . . . . . . . $ 4,893 $ 2,345 $ 3,775
Engineered Components . . . . . . . . 10,592 11,522 17,945
Corporate . . . . . . . . . . . . . . 111 123 111
--------- -------- --------
$ 15,596 $ 13,990 $ 21,831
========= ======== ========
</TABLE>
-56-
<PAGE> 28
<TABLE>
QUARTERLY FINANCIAL DATA (UNAUDITED)
($ in thousands except per share data)
<CAPTION>
FISCAL QUARTER FOR THE YEAR
---------------------------------------------------------------------------------------
1994 1ST 2ND 3RD 4TH
<S> <C> <C> <C> <C> <C>
Net sales . . . . . . . . . . . $ 60,328 $ 67,697 $ 70,902 $ 72,929 $ 271,856
Gross profit . . . . . . . . . 12,635 14,694 15,822 16,107 59,258
Net income . . . . . . . . . . 2,685 3,513 4,291 3,965 14,454
Net income per share . . . . . $ .32 $ .42 $ .51 $ .47 $ 1.72
Average number of . . . . . . .
shares outstanding . . . . . 8,390 8,409 8,444 8,455 8,425
Fiscal Quarter For the Year
---------------------------------------------------------------------------------------
1993 1st 2nd 3rd 4th
Net sales . . . . . . . . . . . $ 53,074 $ 56,405 $ 55,770 $ 57,394 $ 222,643
Gross profit . . . . . . . . . 11,666 13,012 12,879 12,868 50,425
Income (loss) from:
Continuing operations . . . 2,459 2,946 3,407 3,240 12,052
Cumulative effect of
accounting change . . . . (3,942) (3,942)
-------- -------- -------- -------- --------
Net income . . . . . . . . . (1,483) 2,946 3,407 3,240 8,110
Income (loss) per share:
Continuing operations . . . .30 .35 .41 .38 1.44
Cumulative effect of
accounting change . . . . (.47) (.47)
-------- -------- -------- -------- ---------
Net income . . . . . . . . . $ (.17) $ .35 $ .41 $ .38 $ .97
Average number of
shares outstanding . . . . . 8,311 8,335 8,360 8,379 8,347
<FN>
The impact of adopting SFAS 106 on 1993 operating results is not material; therefore, quarterly income from continuing
operations has not been restated.
</TABLE>
-57-
<PAGE> 1
Exhibit 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Annual Report (Form
10-K) of Amcast Industrial Corporation and subsidiaries of our report
dated October 7, 1994, included in the 1994 Annual Report to Shareholders
of Amcast Industrial Corporation.
Our audits also included the financial statement schedules of Amcast
Industrial Corporation listed in item 14(a). These schedules are the
responsibility of the Company s management. Our responsibility is to
express an opinion based on our audits. In our opinion, the financial
statement schedules referred to above, when considered in relation to the
basic financial statements taken as a whole, present fairly in all
material respects the information set forth therein.
We also consent to the incorporation by reference in Post-Effective
Amendment No. 1 to Registration Statement Number 33-2876 on Form S-8 dated
November 27, 1987, in Registration Statement Number 33-18690 on Form S-8
dated December 21, 1987, in Registration Statement Number 33-28084 on Form
S-8 dated April 11, 1989, in Registration Statement Number 33-28080 on
Form S-8 dated April 11, 1989, in Registration Statement Number 33-38176
on Form S-8 dated December 20, 1990, in Registration Statement Number
33-28075 on Form S-3 dated April 11, 1989, in Registration Statement
Number 33-61290 on Form S-8 dated April 19, 1993, of our report dated
October 7, 1994, with respect to the consolidated financial statements
incorporated herein by reference, and our report included in the preceding
paragraph with respect to the financial statement schedules included in
this Annual Report (Form 10-K) of Amcast Industrial Corporation and
subsidiaries.
/s/ Ernst & Young LLP
---------------------
November 28, 1994
-58-
<PAGE> 1
Exhibit 24.1
POWER OF ATTORNEY
-----------------
WHEREAS, Amcast Industrial Corporation (the "Company") intends to file with
the Securities and Exchange Commission its Annual Report on Form 10-K for the
year ended August 31, 1994;
NOW, THEREFORE, the undersigned in his capacity as a director of the Company
hereby appoints Leo W. Ladehoff and John H. Shuey, and each of them, his true
and lawful attorneys-in-fact and agent, with full power of substitution and
resubstitution, to execute in his name, place, and stead, the Company's Annual
Report on Form 10-K for the year ended August 31, 1994, (including an amendment
to such report) and any and all other instruments necessary or incidental in
connection therewith, and to file the same with the Securities and Exchange
Commission. Said attorneys shall have full power and authority to do and
perform in the name and on behalf of the undersigned, in the aforesaid
capacity, every act whatsoever necessary or desirable to be done, as fully to
all intents and purposes as the undersigned might or could do in person. The
undersigned hereby ratifies and approves the acts of said attorneys.
IN WITNESS WHEREOF, the undersigned has executed this instrument this 18th
day of October, 1994.
/s/ James K. Baker
-------------------------
James K. Baker
-59-
<PAGE> 2
POWER OF ATTORNEY
-----------------
WHEREAS, Amcast Industrial Corporation (the "Company") intends to file
with the Securities and Exchange Commission its Annual Report on Form 10-K for
the year ended August 31, 1994;
NOW, THEREFORE, the undersigned in his capacity as a director of the
Company hereby appoints Leo W. Ladehoff and John H. Shuey, and each of them,
his true and lawful attorneys-in-fact and agent, with full power of
substitution and resubstitution, to execute in his name, place, and stead, the
Company's Annual Report on Form 10-K for the year ended August 31, 1994,
(including an amendment to such report) and any and all other instruments
necessary or incidental in connection therewith, and to file the same with the
Securities and Exchange Commission. Said attorneys shall have full power and
authority to do and perform in the name and on behalf of the undersigned, in
the aforesaid capacity, every act whatsoever necessary or desirable to be done,
as fully to all intents and purposes as the undersigned might or could do in
person. The undersigned hereby ratifies and approves the acts of said
attorneys.
IN WITNESS WHEREOF, the undersigned has executed this instrument this
18th day of October, 1994.
/s/ Walter E. Blankley
-------------------------
Walter E. Blankley
-60-
<PAGE> 3
POWER OF ATTORNEY
-----------------
WHEREAS, Amcast Industrial Corporation (the "Company") intends to file
with the Securities and Exchange Commission its Annual Report on Form 10-K for
the year ended August 31, 1994;
NOW, THEREFORE, the undersigned in his capacity as a director of the
Company hereby appoints Leo W. Ladehoff and John H. Shuey, and each of them,
his true and lawful attorneys-in-fact and agent, with full power of
substitution and resubstitution, to execute in his name, place, and stead, the
Company's Annual Report on Form 10-K for the year ended August 31, 1994,
(including an amendment to such report) and any and all other instruments
necessary or incidental in connection therewith, and to file the same with the
Securities and Exchange Commission. Said attorneys shall have full power and
authority to do and perform in the name and on behalf of the undersigned, in
the aforesaid capacity, every act whatsoever necessary or desirable to be done,
as fully to all intents and purposes as the undersigned might or could do in
person. The undersigned hereby ratifies and approves the acts of said
attorneys.
IN WITNESS WHEREOF, the undersigned has executed this instrument this 18th
day of October, 1994.
/s/ Peter H. Forster
-------------------------
Peter H. Forster
-61-
<PAGE> 4
POWER OF ATTORNEY
-----------------
WHEREAS, Amcast Industrial Corporation (the "Company") intends to file
with the Securities and Exchange Commission its Annual Report on Form 10-K for
the year ended August 31, 1994;
NOW, THEREFORE, the undersigned in his capacity as a director of the
Company hereby appoints Leo W. Ladehoff and John H. Shuey, and each of them,
his true and lawful attorneys-in-fact and agent, with full power of
substitution and resubstitution, to execute in his name, place, and stead, the
Company's Annual Report on Form 10-K for the year ended August 31, 1994,
(including an amendment to such report) and any and all other instruments
necessary or incidental in connection therewith, and to file the same with the
Securities and Exchange Commission. Said attorneys shall have full power and
authority to do and perform in the name and on behalf of the undersigned, in
the aforesaid capacity, every act whatsoever necessary or desirable to be done,
as fully to all intents and purposes as the undersigned might or could do in
person. The undersigned hereby ratifies and approves the acts of said
attorneys.
IN WITNESS WHEREOF, the undersigned has executed this instrument this
18th day of October, 1994.
/s/ Ivan W. Gorr
-------------------------
Ivan W. Gorr
-62-
<PAGE> 5
POWER OF ATTORNEY
-----------------
WHEREAS, Amcast Industrial Corporation (the "Company") intends to file
with the Securities and Exchange Commission its Annual Report on Form 10-K for
the year ended August 31, 1994;
NOW, THEREFORE, the undersigned in his capacity as a director of the
Company hereby appoints Leo W. Ladehoff and John H. Shuey, and each of them,
his true and lawful attorneys-in-fact and agent, with full power of
substitution and resubstitution, to execute in his name, place, and stead, the
Company's Annual Report on Form 10-K for the year ended August 31, 1994,
(including an amendment to such report) and any and all other instruments
necessary or incidental in connection therewith, and to file the same with the
Securities and Exchange Commission. Said attorneys shall have full power and
authority to do and perform in the name and on behalf of the undersigned, in
the aforesaid capacity, every act whatsoever necessary or desirable to be done,
as fully to all intents and purposes as the undersigned might or could do in
person. The undersigned hereby ratifies and approves the acts of said
attorneys.
IN WITNESS WHEREOF, the undersigned has executed this instrument this
18th day of October, 1994.
/s/ R. William Van Sant
-------------------------
R. William Van Sant
-63-
<PAGE> 6
POWER OF ATTORNEY
-----------------
WHEREAS, Amcast Industrial Corporation (the "Company") intends to file
with the Securities and Exchange Commission its Annual Report on Form 10-K for
the year ended August 31, 1994;
NOW, THEREFORE, the undersigned in his capacity as a director of the
Company hereby appoints Leo W. Ladehoff and John H. Shuey, and each of them,
his true and lawful attorneys-in-fact and agent, with full power of
substitution and resubstitution, to execute in his name, place, and stead, the
Company's Annual Report on Form 10-K for the year ended August 31, 1994,
(including an amendment to such report) and any and all other instruments
necessary or incidental in connection therewith, and to file the same with the
Securities and Exchange Commission. Said attorneys shall have full power and
authority to do and perform in the name and on behalf of the undersigned, in
the aforesaid capacity, every act whatsoever necessary or desirable to be done,
as fully to all intents and purposes as the undersigned might or could do in
person. The undersigned hereby ratifies and approves the acts of said
attorneys.
IN WITNESS WHEREOF, the undersigned has executed this instrument this
18th day of October, 1994.
/s/ Earl T. O'Loughlin
-------------------------
Earl T. O'Loughlin
-64-
<PAGE> 7
POWER OF ATTORNEY
-----------------
WHEREAS, Amcast Industrial Corporation (the "Company") intends to file
with the Securities and Exchange Commission its Annual Report on Form 10-K for
the year ended August 31, 1994;
NOW, THEREFORE, the undersigned in his capacity as a director of the
Company hereby appoints Leo W. Ladehoff and John H. Shuey, and each of them,
his true and lawful attorneys-in-fact and agent, with full power of
substitution and resubstitution, to execute in his name, place, and stead, the
Company's Annual Report on Form 10-K for the year ended August 31, 1994,
(including an amendment to such report) and any and all other instruments
necessary or incidental in connection therewith, and to file the same with the
Securities and Exchange Commission. Said attorneys shall have full power and
authority to do and perform in the name and on behalf of the undersigned, in
the aforesaid capacity, every act whatsoever necessary or desirable to be done,
as fully to all intents and purposes as the undersigned might or could do in
person. The undersigned hereby ratifies and approves the acts of said
attorneys.
IN WITNESS WHEREOF, the undersigned has executed this instrument this
18th day of October, 1994.
/s/ William G. Roth
-------------------------
William G. Roth
-65-
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