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<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
/X/ ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1994
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from __________ to __________.
Commission file number 1-5725
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
Nichols-Homeshield 401(k) Savings Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
Quanex Corporation
1900 West Loop South, Suite 1500
Houston, Texas 77027
Phone: (713) 961-4600
<PAGE> 2
INDEPENDENT AUDITORS' REPORT
The Benefits Committee
Quanex Corporation
Houston, Texas
Re: Nichols-Homeshield 401(k) Savings Plan
We have audited the accompanying statement of net assets available for benefits
of the Nichols-Homeshield 401(k) Savings Plan (the "Plan") as of December 31,
1994, and the related statement of changes in net assets available for benefits
for the year then ended. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit 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
from 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 audit provides a reasonable basis
for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
1994, and the changes in net assets available for benefits for the year then
ended in conformity with generally accepted accounting principles.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental
information by fund and supplemental schedules of (1) investments as of
December 31, 1994 and (2) 5% reportable transactions for the year ended
December 31, 1994 are presented for the purpose of additional analysis of the
basic financial statements rather than to present information regarding the net
assets available for benefits and changes in net assets available for benefits
of the individual funds. This information and these schedules are not a
required part of the basic financial statements. The schedules are
supplementary information required by the Department of Labor's Rules and
Regulation for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. This supplemental information and these schedules are
the responsibility of the Plan's management. Such supplemental information and
schedules have been subjected to the auditing procedures applied in our audit
of the basic financial statements and, in our opinion, are fairly stated in all
material respects when considered in relation to the basic financial statements
taken as a whole.
<PAGE> 3
We were engaged to audit the financial statements of the Plan as of December
31, 1993, and for the year then ended. These financial statements are the
responsibility of the Plan's management.
As permitted by Section 2520.103-8 of the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974, the plan administrator instructed us not to perform, and
we did not perform, any auditing procedures with respect to the information
summarized in Note C, which was certified by Fidelity Management Trust Company,
the trustee of the Plan, except for comparing the information with the related
information included in the financial statements and supplemental schedules.
We have been informed by the plan administrator that the trustee holds the
Plan's investment assets and executes investment transactions. The plan
administrator has obtained certification from the trustee as of and for the
year ended December 31, 1993, that the information provided to the plan
administrator by the trustee is complete and accurate.
Because of the significance of the information that we did not audit, we are
unable to express, and do not express, an opinion on the accompanying 1993
financial statements taken as a whole. The form and content of the information
included in the financial statements, other than that derived from the
information certified by the trustee, have been audited by us in accordance
with generally accepted auditing standards and, in our opinion, are presented
in compliance with the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974.
/s/ Deloitte & Touche LLP
May 17, 1995
<PAGE> 4
QUANEX CORPORATION
NICHOLS-HOMESHIELD 401(k) SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE
FOR BENEFITS
<TABLE>
<CAPTION>
December 31,
---------------------------------
1994 1993
----------- -----------
<S> <C> <C>
Assets:
Investments, at fair value -
Mutual fund assets $15,699,683 $15,492,445
Quanex Corporation common stock 235,079 -
Common/commingled trust 301,399 -
----------- -----------
16,236,161 15,492,445
Participant loans 754,101 754,644
----------- -----------
Total investments 16,990,262 16,247,089
----------- -----------
Receivables:
Employer 99,021 87,333
Employee 92,359 76,973
----------- -----------
191,380 164,306
----------- -----------
Net assets available for benefits $17,181,642 $16,411,395
=========== ===========
</TABLE>
See notes to financial statements.
<PAGE> 5
QUANEX CORPORATION
NICHOLS-HOMESHIELD 401(k) SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE
FOR BENEFITS
<TABLE>
<CAPTION>
December 31,
--------------------------------
1994 1993
------------- --------------
<S> <C> <C>
Investment income:
Interest and dividends $ 687,316 $ 891,916
Net appreciation (depreciation) in fair
value of investments (571,943) 736,578
------------- --------------
Total 115,373 1,628,494
------------- --------------
Contributions
Employer 1,120,702 1,050,833
Less forfeitures 20,055 19,602
------------- --------------
1,100,647 1,031,231
Employee 1,178,336 1,043,363
------------- --------------
Total 2,278,983 2,074,594
------------- --------------
Interest on participant loans 51,773 44,842
------------- --------------
Total additions 2,446,129 3,747,930
------------- --------------
Benefit payments 1,672,433 1,353,612
Administrative fees 3,449 -
------------- --------------
Total deductions 1,675,882 1,353,612
------------- --------------
Increase in net assets available
for benefits 770,247 2,394,318
Net assets available for benefits:
Beginning of year 16,411,395 14,017,077
------------- --------------
End of year $ 17,181,642 $ 16,411,395
============= ==============
</TABLE>
See notes to financial statements.
<PAGE> 6
QUANEX CORPORATION
NICHOLS-HOMESHIELD 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1994 AND 1993
A. DESCRIPTION OF THE PLAN
The following description of the Nichols-Homeshield 401(k) Savings
Plan (the "Plan") is provided for general information purposes only.
Participants should refer to the Plan document for more complete
information.
(1) General. The Plan was established on October 1, 1987 as a
defined contribution plan under Section 401(k) of the Internal
Revenue Code ("IRC") which covers substantially all salaried
and non-union hourly employees at the Nichols-Homeshield
division of Quanex Corporation (the "Company") and bargaining
unit employees at the Lincolnshire, Illinois plant. On
October 31, 1991, this plan merged with the
Nichols-Homeshield, Inc. and Participating Companies Salaried
Employees Profit Sharing Retirement Plan. Effective January
1, 1992, the name was changed from the Nichols-Homeshield,
Inc. 401(k) Savings Plan to the Nichols-Homeshield 401(k)
Savings Plan when the sponsorship was transferred to the
Company. The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974 ("ERISA").
The assets of the Plan are held in trust by Fidelity
Management Trust Company (the "Trustee"). The Benefits
Committee (the "Committee"), appointed by the Company's Board
of Directors, serves as the Plan administrator.
(2) Contributions. Employees are eligible to make contributions
to the Plan after three months of service. Effective July
1992, participants may elect salary deferrals between 1% and
15% of compensation as defined by the Plan agreement The
Company makes contributions on behalf of employees who have at
least one year of service. The Company contribution is based
on company profits and is calculated based on a percentage of
the employee's compensation.
(3) Participant Accounts. Each participant's account is credited
with the participant's contribution, the employer's
contribution, and an allocation of investment income.
Investment income allocations are based upon individual
participant account balances as of the end of the period in
which the income was earned.
(4) Investment Options. Effective April 1, 1992, the Company
appointed the Trustee to manage all funds of the Plan.
Participants may direct allocation of their contributions to
eight investment funds and Quanex stock as follows:
Government Money Market Fund - composed of short-term
government obligations.
Short-Intermediate Government Fund - invested and reinvested
in securities issued by U. S. government.
Balanced Fund - invested and reinvested in common and
preferred stocks and bonds.
Growth and Income Fund - invested and reinvested in equity and
debt securities of foreign and domestic companies.
<PAGE> 7
Magellan Fund - invested and reinvested in equity and debt
securities of foreign and domestic companies.
Contrafund - invested and reinvested in equities of foreign
and domestic companies.
Overseas Fund - invested and reinvested in foreign securities.
Common/Commingled Trust - invested and reinvested in
investment contracts issued by insurance companies, banks and
other financial institutions.
Puritan Fund - invested and reinvested in common and preferred
stocks and bonds.
Quanex Corporation Common Stock - invested and reinvested
exclusively in the common stock of Quanex Corporation.
During 1994, the Common/Commingled Trust and the Quanex
Corporation Common Stock were added as investment options. In
addition, the Short-Intermediate Government Fund was replaced
by the Puritan Fund effective July 1, 1994.
(5) Vesting. Participants are immediately vested in their
voluntary contributions and earnings thereon. Vesting in the
employer contribution is based on years of credited service.
A participant is 20% vested for each year of credited service
and fully vested after five years. If a participant
terminates employment prior to becoming fully vested, the
nonvested portion of the employer contributions are
immediately forfeited by the participant and utilized to
reduce future employer contributions.
(6) Payment of Benefits. The Plan is intended for long-term
savings but provides for early withdrawals and loan
arrangements under certain conditions. Upon termination of
service, a participant may elect to receive a cash lump-sum
distribution equal to the amount of vested benefits in his or
her account. For further discussion of benefits payable, see
Note G.
(7) Loans. Loans may be granted to a participant of the Plan at
the Committee's discretion. Any loan authorized by the
Committee shall be subject to a term not to exceed five years.
The Committee may agree to a longer term (up to seven years)
only if the proceeds of the loan are to be used to purchase a
dwelling. The loans bear a reasonable rate of interest
established by the Committee. Interest on the loan is
allocated to the borrower's participant account.
B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(1) Accounting Basis. The financial statements of the Plan are
prepared on the accrual basis of accounting in accordance with
generally accepted accounting principles.
(2) Administrative Expenses. Administrative expenses of the Plan
are paid by the Company. Loan set up fees and carrying fees
are paid by the participant.
<PAGE> 8
(3) Investment Valuation. The Plan recognizes net appreciation or
depreciation in the fair value of its investments.
Investments are reflected at fair value in the financial
statements. Fair value of mutual fund assets is determined
using a quoted net asset value. Fair value for Quanex
Corporation Common Stock, which is listed in the New York
Stock Exchange, is determined by using the last recorded sales
price
(4) Payment of Benefits. Benefits are recorded when paid.
C. INVESTMENTS AND INFORMATION FURNISHED BY THE TRUSTEE (UNAUDITED)
The following is a summary of the unaudited information included in
the Plan's 1993 financial statements and supplemental schedules that
was prepared by the Trustee and furnished to the Company. The Company
obtained certification from the Trustee that such 1993 information is
complete and accurate.
<TABLE>
<CAPTION>
1993
-----------
<S> <C>
At December 31,
Investments, at fair value $15,492,445
For the year ended December 31,
Interest and dividends 891,916
Net appreciation (depreciation) in
fair value of investments 736,578
</TABLE>
In addition, 1993 investment-related information included in Notes F,
H and I has been certified by the Trustee.
D. PLAN TERMINATION
Although it has not expressed any intention to do so, the Company has
the right under the Plan to terminate the Plan at any time subject to
the provisions set forth in ERISA. In the event of plan termination,
the assets held by the Trustee under the Plan will be valued and fully
vested, and each participant will be entitled to distributions
respecting his or her account.
E. FEDERAL INCOME TAX STATUS
Management of the Company, the Plan administrator, and the Plan's
legal counsel are of the opinion that the Plan is qualified under
Sections 401(a) and 401(k) and exempt from federal income tax under
Section 501(a) of the IRC. The Plan received a favorable letter of
tax determination from the Internal Revenue Service dated November 7,
1990 as to the tax-exempt status of the Plan.
<PAGE> 9
F. RELATED PARTY TRANSACTIONS
During the year ended December 31, 1994 and 1993, the Plan purchased
shares of Quanex Corporation common stock, as shown below:
<TABLE>
<CAPTION>
1994 1993
---- ----
Shares Cost Shares Cost
------ ---- ------ ----
<S> <C> <C> <C>
10,964 $255,321 -0- -0-
</TABLE>
During the year ended December 31, 1994, the Plan sold 687 shares of
Quanex Corporation common stock at $20,171 (cost $17,920).
During the years ended December 31, 1994 and 1993, the Plan purchased
shares of Fidelity mutual funds, as shown below:
<TABLE>
<CAPTION>
1994 1993
---- ----
Shares Cost Shares Cost
------ ---- ------ ----
<S> <C> <C> <C>
4,518,739 $8,517,972 1,770,553 $8,945,132
</TABLE>
During the year ended December 31, 1994, the Plan sold 2,308,717
shares of Fidelity mutual fund assets valued at $7,682,740 (cost
$7,741,110). During the year ended December 31, 1993, the Plan sold
2,220,950 shares of Fidelity mutual fund assets valued at $7,812,039
(cost $7,661,190).
During the year ended December 31, 1994, the Plan purchased 580,428
shares (cost $580,428) of Fidelity, the Trustee Common/Commingled
Trust. During the year ended December 31, 1994, the Plan sold 279,029
shares of Fidelity, the Trustee Common/Commingled Trust for $279,029
(cost $279,029).
G. RECONCILIATION OF FINANCIAL STATEMENT TO FORM 5500
Benefits payable are not reportable as a liability on the statement of
net assets available for benefits in the financial statements prepared
in conformity with generally accepted accounting principles. See
reconciliation of financial statements to Form 5500 below:
<TABLE>
<CAPTION>
December 31,
-------------------------------
1994 1993
----------- -----------
<S> <C> <C>
Net assets available for benefits per
financial statements $17,181,642 $16,411,395
Less: Benefits payable 553,455 163,387
----------- -----------
Net assets available for benefits per
Form 5500 $16,628,187 $16,248,008
=========== ===========
</TABLE>
For the years ended December 31, 1994 and 1993, benefit payments
recorded in the financial statements totaled $1,672,433 and
$1,313,612, respectively. Benefit payments for 1994 and 1993 recorded
in Form 5500 totaled $2,062,501 and $1,359,133, respectively.
<PAGE> 10
H. ALLOCATION OF NET ASSETS AVAILABLE FOR BENEFITS TO INVESTMENT PROGRAMS
The following tables provide supplemental information regarding the net
assets available for benefits by investment fund.
<TABLE>
<CAPTION>
December 31, 1994
- ------------------------------------------------------------------------------------------------------------------------------------
SHORT-
GOVT. INTER- GROWTH
MONEY MEDIATE AND
MARKET GOVT. BALANCED INCOME MAGELLAN OVERSEAS
TOTAL FUND FUND FUND FUND FUND FUND
----------- ---------- ------- -------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments, at fair value
Mutual fund assets $15,699,683 $6,765,969 $ 0 $836,053 $3,140,449 $3,043,570 $343,791
Quanex Corporation
common stock 235,079
Common/commingled trust 301,399
Participant loans 754,101 314,250 0 38,831 145,861 141,361 15,968
----------- ---------- ----- -------- ---------- ---------- --------
Total Investments 16,990,262 7,080,219 0 874,884 3,286,310 3,184,931 359,759
----------- ---------- ----- -------- ---------- ---------- --------
Contributions receivable
Employer 99,021 30,769 0 11,931 18,012 21,579 1,411
Employee 92,359 24,651 0 10,338 18,126 21,061 1,604
----------- ---------- ----- -------- ---------- ---------- --------
191,380 55,420 0 22,269 36,138 42,640 3,015
----------- ---------- ----- -------- ---------- ---------- --------
Net assets available
for benefits $17,181,642 $7,135,639 $ 0 $897,153 $3,322,448 $3,227,571 $362,774
=========== ========== ===== ======== ========== ========== ========
<CAPTION>
QUANEX COMMON\
CONTRA- COMMON PURITAN COMMINGLED
FUND STOCK FUND TRUST
---------- -------- ------- ----------
<S> <C> <C> <C> <C>
Assets:
Investments, at fair value
Mutual fund assets $1,496,428 $73,423
Quanex Corporation
common stock $235,079
Common/commingled trust $301,399
Participant loans 69,503 10,918 3,410 13,999
---------- -------- ------- --------
Total Investments 1,565,931 245,997 76,833 315,398
---------- -------- ------- --------
Contributions receivable
Employer 13,214 592 665 848
Employee 11,350 1,018 940 3,271
---------- -------- ------- --------
24,564 1,610 1,605 4,119
---------- -------- ------- --------
Net assets available
for benefits $1,590,495 $247,607 $78,438 $319,517
========== ======== ======= ========
</TABLE>
<TABLE>
<CAPTION>
December 31, 1993 (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
SHORT-
GOVT. INTER- U.S. GROWTH
MONEY MEDIATE BOND AND
MARKET GOVT. INDEX BALANCED INCOME MAGELLAN OVERSEAS CONTRA-
TOTAL FUND FUND FUND FUND FUND FUND FUND FUND
----------- ---------- ---------- ------ -------- ---------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments, at fair value
Mutual fund assets $15,492,445 $4,331,275 $2,422,025 $ 0 $786,558 $3,138,194 $2,981,202 $298,649 $1,534,542
Participant loans 754,644 246,317 182,058 0 6,127 140,570 153,043 1,276 25,253
----------- ---------- ---------- --- -------- ---------- ---------- -------- ----------
Total Investments 16,247,089 4,577,592 2,604,083 0 792,685 3,278,764 3,134,245 299,925 1,559,795
----------- ---------- ---------- --- -------- ---------- ---------- -------- ----------
Contributions receivable 87,333 17,172 9,060 0 11,229 16,903 19,657 567 12,745
Employer 76,973 13,321 6,642 0 10,086 15,675 17,857 914 12,478
----------- ---------- ---------- --- -------- ---------- ---------- -------- ----------
Employee 164,306 30,493 15,702 0 21,315 32,578 37,514 1,481 25,223
----------- ---------- ---------- --- -------- ---------- ---------- -------- ----------
Net assets available
for benefits $16,411,395 $4,608,085 $2,619,785 $ 0 $814,000 $3,311,342 $3,171,759 $301,406 $1,585,018
=========== ========== ========== === ======== ========== ========== ======== ==========
</TABLE>
<PAGE> 11
I. ALLOCATION OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS TO INVESTMENT
PROGRAMS
The following tables provide supplemental information regarding the change
in net assets available for benefits by investment fund.
<TABLE>
<CAPTION>
December 31, 1994
- ------------------------------------------------------------------------------------------------------------------------------------
GOVT. GROWTH
MONEY QUANEX COMMON\ AND
MARKET COMMON COMMINGLED BALANCED INCOME PURITAN
TOTAL FUND STOCK TRUST FUND FUND FUND
----------- ---------- -------- ---------- -------- ---------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Interest and dividends $687,316 $224,906 $1,666 $7,315 $25,994 $228,631 $2,462
Net appreciation (depreciation)
in fair value of investments (571,943) 0 (2,321) 0 (73,391) (173,087) (3,099)
----------- ---------- -------- --------- -------- ---------- -------
Total 115,373 224,906 (655) 7,315 (47,397) 55,544 (637)
----------- ---------- -------- --------- -------- ---------- -------
Contributions:
Employer 1,120,702 291,733 2,686 3,752 134,951 212,488 2,845
Less forfeitures (20,055) (4,291) 0 0 (1,085) (2,622) 0
----------- ---------- -------- --------- -------- ---------- -------
1,100,647 287,442 2,686 3,752 133,866 209,866 2,845
Employee 1,178,336 237,777 50,706 8,814 133,354 235,006 4,693
----------- ---------- -------- --------- -------- ---------- -------
2,278,983 525,219 53,392 12,566 267,220 444,872 7,538
----------- ---------- -------- --------- -------- ---------- -------
Interest on participant loans 51,773 9,048 0 41 6,535 12,936 20
----------- ---------- -------- --------- -------- ---------- -------
Total Additions 2,446,129 759,173 52,737 19,922 226,358 513,352 6,921
----------- ---------- -------- --------- -------- ---------- -------
Benefit payments 1,672,433 733,507 2,320 2,972 147,526 231,561 724
Administrative Fee 3,449 275 0 0 54 405 19
----------- ---------- -------- --------- -------- ---------- -------
1,675,882 733,782 2,320 2,972 147,580 231,966 743
Fund transfers 0 2,502,163 197,190 302,567 4,375 (270,280) 72,260
----------- ---------- -------- --------- -------- ---------- -------
Increase in net assets
available for benefits 770,247 2,527,554 247,607 319,517 83,153 11,106 78,438
Net assets available of benefits:
Beginning of year 16,411,395 4,608,085 0 0 814,000 3,311,342 0
----------- ---------- -------- --------- -------- ---------- -------
End of year $17,181,642 $7,135,639 $247,607 $319,517 $897,153 $3,322,448 $78,438
=========== ========== ======== ========= ======== ========== =======
</TABLE>
<TABLE>
<CAPTION>
SHORT
INTER-
MEDIATE
MAGELLAN OVERSEAS CONTRA- GOVT
FUND FUND FUND FUND
---------- -------- ---------- ----------
<S> <C> <C> <C> <C>
Investment income:
Interest and dividends $117,968 $3,476 $11,202 $63,696
Net appreciation (depreciation)
in fair value of investments (175,101) (5,168) (32,841) (106,935)
---------- -------- ---------- ----------
Total (57,133) (1,692) (21,639) (43,239)
---------- -------- ---------- ----------
Contributions:
Employer 253,862 10,942 162,937 44,506
Less forfeitures (6,365) (50) (3,517) (2,125)
---------- -------- ---------- ----------
247,497 10,892 159,420 42,381
Employee 271,963 15,923 179,701 40,399
---------- -------- ---------- ----------
519,460 26,815 339,121 82,780
---------- -------- ---------- ----------
Interest on participant loans 11,792 205 8,864 2,332
---------- -------- ---------- ----------
Total Additions 474,119 25,328 326,346 41,873
---------- -------- ---------- ----------
Benefit payments 173,120 14,196 114,938 251,569
Administrative Fee 2,593 0 103 0
---------- -------- ---------- ----------
175,713 14,196 115,041 251,569
Fund transfers (242,594) 50,236 (205,828) (2,410,089)
---------- -------- ---------- ----------
Increase in net assets
available for benefits 55,812 61,368 5,477 (2,619,785)
Net assets available of benefits:
Beginning of year 3,171,759 301,406 1,585,018 2,619,785
---------- -------- ---------- ----------
End of year $3,227,571 $362,774 $1,590,495 $0
========== ======== ========== ==========
</TABLE>
<PAGE> 12
I. ALLOCATION OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS TO INVESTMENT
PROGRAMS
(continued)
<TABLE>
<CAPTION>
December 31, 1993 (Unaudited)
- -------------------------------------------------------------------------------------------------------------------------------
SHORT-
GOVT. INTER- U. S. GROWTH
MONEY MEDIATE BOND AND
MARKET GOVT. INDEX BALANCED INCOME MAGELLAN
TOTAL FUND FUND FUND FUND FUND FUND
----------- ---------- --------- ---------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Interest and dividends $891,916 $127,506 $142,733 $14,812 $63,407 $169,672 $260,394
Net appreciation (depreciation)
in fair value of investments 736,578 0 (18,189) 37,569 33,765 306,495 265,428
----------- ---------- --------- ---------- -------- ---------- ----------
Total 1,628,494 127,506 124,544 52,381 97,172 476,167 525,822
----------- ---------- --------- ---------- -------- ---------- ----------
Contributions:
Employer 1,050,833 205,594 117,995 0 126,772 208,805 227,883
Less forfeitures 19,602 8,872 1,531 0 1,292 2,980 4,201
----------- ---------- --------- ---------- -------- ---------- ----------
1,031,231 196,722 116,464 0 125,480 205,825 223,682
Employee 1,043,363 164,666 104,923 0 134,605 224,309 227,388
----------- ---------- --------- ---------- -------- ---------- ----------
2,074,594 361,388 221,387 0 260,085 430,134 451,070
----------- ---------- --------- ---------- -------- ---------- ----------
Interest on participant loans 44,842 5,885 4,653 384 5,519 11,665 8,492
----------- ---------- --------- ---------- -------- ---------- ----------
Total Additions 3,747,930 494,779 350,584 52,765 362,776 917,966 985,384
----------- ---------- --------- ---------- -------- ---------- ----------
Benefit payments 1,353,612 296,196 619,134 0 83,519 222,734 95,572
Fund transfers 0 (649,799) 2,888,335 (3,259,157) 146,621 191,800 103,559
----------- ---------- --------- ---------- -------- ---------- ----------
Increase in net assets
available for benefits 2,394,318 (451,216) 2,619,785 (3,206,392) 425,878 887,032 993,371
Net assets available for benefits:
Beginning of year 14,017,077 5,059,301 0 3,206,392 388,122 2,424,310 2,178,388
----------- ---------- --------- ---------- -------- ---------- ----------
End of year $16,411,395 $4,608,085 2,619,785 $0 $814,000 $3,311,342 $3,171,759
=========== ========== ========= ========== ======== ========== ==========
<CAPTION>
OVERSEAS CONTRA-
FUND FUND
-------- ----------
<S> <C> <C>
Investment income:
Interest and dividends $5,194 $108,198
Net appreciation (depreciation)
in fair value of investments 13,061 98,449
-------- ----------
Total 18,255 206,647
-------- ----------
Contributions:
Employer 2,571 161,213
Less forfeitures 0 726
-------- ----------
2,571 160,487
Employee 3,482 183,990
-------- ----------
6,053 344,477
-------- ----------
Interest on participant loans 0 8,244
-------- ----------
Total Additions 24,308 559,368
-------- ----------
Benefit payments 0 36,457
Fund transfers 277,098 301,543
-------- ----------
Increase in net assets
available for benefits 301,406 824,454
Net assets available for benefits:
Beginning of year 0 760,564
-------- ----------
End of year $301,406 $1,585,018
======== ==========
</TABLE>
<PAGE> 13
Item 27a - Schedule of Assets Held for Investment Purposes
EIN: 38-1872178; PN 017
QUANEX CORPORATION
NICHOLS-HOMESHIELD 401(K) SAVINGS PLAN
SUPPLEMENTAL SCHEDULE OF INVESTMENTS
DECEMBER 31, 1994
<TABLE>
<CAPTION>
Shares/ Current
Par Value Cost Value
--------- ---- -------
<S> <C> <C> <C>
Mutual fund assets Fidelity Investments:
- ----------------------------------------
Government Money Market Fund* 6,765,969 $6,765,969 $6,765,969
Balanced Fund* 68,027 883,328 836,053
Puritan Fund* 4,958 76,431 73,423
Contrafund* 49,420 1,458,844 1,496,428
Growth and Income Fund* 148,907 3,143,386 3,140,449
Magellan* 45,562 3,090,646 3,043,570
Overseas Fund* 12,593 348,306 343,791
------------ ------------
Total Mutual Fund Assets 15,766,910 15,699,683
------------ ------------
Quanex Corporation Common Stock* 10,277 239,652 235,079
Common/Commingled Trust* 301,399 301,399 301,399
Participant loans (bearing interest rates
from 7.85% to 11%) 754,101
------------ ------------
Total investments $ 16,307,961 $ 16,990,262
============ ============
</TABLE>
*Party-in-Interest
<PAGE> 14
Item 27d - Schedule of Reportable (5%) Transactions
EIN 38-1872178; PN 017
NICHOLS-HOMESHIELD 401(K) SAVINGS PLAN
SUPPLEMENTAL SCHEDULE OF 5% REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1994
Series of Transactions
<TABLE>
<CAPTION>
Current
Total Number of Total Number Value on Net
Purchases During Purchase of Sales During Selling Cost of Transaction Gain
Description Plan Year Price Plan Year Price Asset Date (Loss)
- ----------- ----------------- --------- --------------- ------- ------- ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Quanex Corporation Common Stock 11 $255,321
1 $20,171 $17,920 $20,171 $2,251
Puritan Fund 23 77,754
2 1,323 1,232 1,323 91
Magellan Fund 97 1,098,712
66 866,282 861,242 866,282 5,040
Contrafund 86 817,002
52 839,472 822,275 839,472 17,197
Growth & Income Fund 87 955,156
55 823,496 779,814 823,496 43,682
Overseas Fund 40 614,453
12 575,726 564,143 575,726 11,583
Balanced Fund 74 412,678
49 280,681 289,793 280,681 (9,112)
Government Money Market Fund 86 4,361,299
79 1,926,604 1,926,604 1,926,604 0
</TABLE>
<PAGE> 15
Item 27d - Schedule of Reportable (5%) Transactions EIN 38-1872178; PN 017
NICHOLS-HOMESHIELD 401(K) SAVINGS PLAN
SUPPLEMENTAL SCHEDULE OF 5% REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1994
Series of Transactions
(continued)
<TABLE>
<CAPTION>
Current
Total Number of Total Number Value on Net
Purchases During Purchase of Sales During Selling Cost of Transaction Gain
Description Plan Year Price Plan Year Price Asset Date (Loss)
- ----------- ----------------- --------- --------------- ------- ------- ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Common/Commingled Trust 28 580,428
2 279,029 279,029 279,029 0
Short Intermediate
Government Fund 43 $180,918
32 $2,369,156 $2,496,007 $2,369,156 $(126,851)
</TABLE>
<PAGE> 16
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee benefit plan)
have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
DATE 6/26/95 /s/ Joseph K. Peery
---------------------------------- Joseph K. Peery
<PAGE> 17
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER
<S> <C>
23.1 Independent Auditor's Consent
</TABLE>
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement
No. 33-54081 of Quanex Corporation on Form S-8 of our report dated May 17,
1995, appearing in this Annual Report on Form 11-K of Nichols-Homeshield 401(k)
Savings Plan for the year ended December 31, 1994.
/s/ Deloitte & Touche LLP
- ------------------------------
DELOITTE & TOUCHE LLP
Houston, Texas
June 29, 1994
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