SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13
OF THE SECURITIES EXCHANGE ACT OF 1934
For quarter ended December 31, 1995 Commission File Number 1-7256
INTERNATIONAL ALUMINUM CORPORATION
(Exact name of Registrant as specified in its charter)
California 95-2385235
(State of incorporation) (I.R.S. Employer No.)
767 Monterey Pass Road
Monterey Park, California 91754
(213) 264-1670
(Principal executive office)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 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
At February 1, 1996 there were 4,257,880 shares of Common Stock outstanding.
Page 1 of 11 Pages
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INTERNATIONAL ALUMINUM CORPORATION
AND SUBSIDIARIES
INDEX
Page Nos.
PART I Financial Information
Consolidated Balance Sheets -
December 31, 1995 and June 30, 1995 3
Consolidated Statements of Income -
three and six month periods
ended December 31, 1995 and 1994 5
Consolidated Statements of Cash Flows -
six months ended December 31, 1995
and 1994 6
Notes to Consolidated Financial Statements 7
Management's Discussion and Analysis of
Financial Condition and Results of
Operations 8
PART II Other Information
Item 4. Submission of Matters to a Vote of
Security Holders 10
Signatures 11
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<TABLE>
PART I
INTERNATIONAL ALUMINUM CORPORATION
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<CAPTION>
Unaudited Audited
Assets Dec. 31, 1995 June 30, 1995
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 8,923,000 $ 3,550,000
Investments 2,213,000
Accounts receivable, net 34,430,000 34,877,000
Unbilled receivables 1,071,000 1,222,000
Inventories:
Raw materials 28,966,000 31,002,000
Work-in-process 1,854,000 3,463,000
Finished goods 7,538,000 7,308,000
Prepaid expenses 2,201,000 2,060,000
Future income tax benefits 1,596,000 1,596,000
Total current assets 86,579,000 87,291,000
____________ ____________
Property, plant and equipment, at cost 99,825,000 97,412,000
Accumulated depreciation (53,392,000) (52,567,000)
46,433,000 44,845,000
____________ ____________
Other assets:
Costs in excess of net assets of
purchased businesses 4,772,000 4,839,000
Other 1,046,000 1,129,000
5,818,000 5,968,000
____________ ____________
$138,830,000 $138,104,000
____________ ____________
____________ ____________
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
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<TABLE>
INTERNATIONAL ALUMINUM CORPORATION
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<CAPTION>
Unaudited Audited
Liabilities and Shareholders' Equity Dec. 31, 1995 June 30, 1995
<S> <C> <C>
Current liabilities:
Accounts payable $ 8,199,000 $ 7,820,000
Accrued liabilities 8,773,000 9,555,000
Current portion of long-term debt 422,000 423,000
Income taxes payable 586,000 1,098,000
Total current liabilities 17,980,000 18,896,000
____________ ____________
Long-term debt 258,000 542,000
____________ ____________
Other liabilities:
Deferred income taxes 4,496,000 4,496,000
Other 390,000 399,000
4,886,000 4,895,000
____________ ____________
Shareholders' equity 115,706,000 113,771,000
____________ ____________
$138,830,000 $138,104,000
____________ ____________
____________ ____________
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
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<PAGE> <TABLE> Unaudited
INTERNATIONAL ALUMINUM CORPORATION
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
<CAPTION>
Three Months Ended Six Months Ended
December 31, December 31,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Net sales $54,354,000 $52,992,000 $110,392,000 $104,755,000
Costs and expenses:
Cost of sales 38,844,000 35,803,000 79,484,000 70,737,000
Selling, general and
administrative expenses 12,411,000 11,496,000 24,155,000 22,464,000
Interest (income) expense, net (58,000) 203,000 (70,000) 105,000
Income before income taxes 3,157,000 5,490,000 6,823,000 11,449,000
Provision for income taxes 1,140,000 2,180,000 2,730,000 4,530,000
Net income $ 2,017,000 $ 3,310,000 $ 4,093,000 $ 6,919,000
___________ ___________ ____________ ____________
___________ ___________ ____________ ____________
Weighted average number of
common shares outstanding 4,257,564 4,238,362 4,255,882 4,235,767
Earnings per common share $.47 $.78 $ .96 $1.63
Cash dividends per common share $.25 $.25 $.50 $.50
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
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<PAGE> <TABLE> Unaudited
INTERNATIONAL ALUMINUM CORPORATION
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
Six Months Ended
December 31,
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net income $ 4,093,000 $ 6,919,000
Adjustments for noncash transactions:
Depreciation and amortization 2,516,000 2,322,000
Changes in assets and liabilities:
Receivables 505,000 (865,000)
Inventories 3,387,000 (4,898,000)
Prepaid expenses and other ( 66,000) (467,000)
Accounts payable 426,000 (315,000)
Accrued liabilities and other (762,000) (619,000)
Income taxes payable (514,000) (1,227,000)
Net cash provided by operating activities 9,585,000 850,000
Cash flows from investing activities:
Capital expenditures (4,228,000) (2,582,000)
Proceeds from sales of capital assets 137,000 2,403,000
Changes in investments 2,213,000 5,202,000
Net cash provided by (used in)
investing activities (1,878,000) 5,023,000
Cash flows from financing activities:
Repayment of long-term debt (285,000) (422,000)
Exercise of stock options 79,000 61,000
Dividends paid to shareholders (2,129,000) (2,119,000)
Net cash used in financing activities (2,335,000) (2,480,000)
Effect of exchange rate changes on cash 1,000 8,000
Net change in cash and cash equivalents 5,373,000 3,401,000
Cash and cash equivalents at beginning
of period 3,550,000 6,413,000
Cash and cash equivalents at end of period $ 8,923,000 $ 9,814,000
___________ ___________
___________ ___________
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
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<PAGE> Unaudited
INTERNATIONAL ALUMINUM CORPORATION
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Basis of Presentation
In the opinion of management, the accompanying unaudited consolidated
financial statements contain all adjustments (which consist solely of normal
recurring adjustments unless otherwise disclosed) necessary to present fairly
its financial position as of December 31, 1995 and June 30, 1995, and the
results of operations for the three and six month periods ended December 31,
1995 and 1994, and the cash flows for the six month periods ended December 31,
1995 and 1994.
The results of operations for the three and six month periods ended
December 31, 1995 and 1994 are not necessarily indicative of the results to
be expected for the full year.
The financial statements included herein have been prepared by the Company
pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules
and regulations, although the Company believes that the disclosures are
adequate to make the information presented not misleading. It is suggested
that these financial statements be read in conjunction with the financial
statements and the notes thereto included in the Company's latest annual
report on Form 10-K.
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<PAGE> Unaudited
INTERNATIONAL ALUMINUM CORPORATION
AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition
and Results of Operations
Significant Changes in Results of Operations:
Net sales increased by $1,362,000 or 2.6% for the quarter ended December 31,
1995 and by $5,637,000 or 5.4% for the six months then ended when compared
with the 1994 periods. These sales include significant increases posted by
the Commercial Products Group, up $3,677,000 or 16.8% for the quarter and by
$8,458,000 or 20.1% for the six months. These increases were partially offset
by decreases posted by the Aluminum Extrusion Group, whose sales were down
$2,341,000 or 18.3% for the quarter and $1,882,000 or 7.4% for the six months.
Cost of sales as a percentage of net sales increased by 3.9% for the quarter
ended December 31, 1995 and by 4.5% for the six months then ended when
compared with the 1994 periods. These increases are primarily attributable
to significantly decreased margins in the Aluminum Extrusion Group resulting
from increased material costs coupled with declining selling prices.
Additionally, substantially all of the Company's fabrication facilities
incurred decreased margins associated with rising material costs.
Selling, general and administrative expenses increased by $915,000 or 8.0%
for the quarter and by $1,691,000 or 7.5% for the six month period. The
increases primarily relate to additional selling costs associated with the
expansion of the commercial products satellite warehouse program.
The increase in net interest income for the six month period primarily
reflects the significant decrease during the second quarter of the prior year
of the market value of interest rate sensitive securities.
The effective tax rate for the six months ended December 31, 1995 was 40.0%
whereas the comparable period of fiscal year 1995 was 39.6%.
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<PAGE> Unaudited
Liquidity and Capital Resources:
Working capital increased to $68,599,000 during the six months ended
December 31, 1995, which represents an increase of $204,000 from June 30,
1995. The ratio of current assets to current liabilities is currently 4.8 as
compared to 4.6 as of the beginning of the year.
The Company's projected net capital expenditures for fiscal 1996 include
$6,000,000 for scheduled expansion of production capacity in addition to the
normal annual noncapitalized expenditures for replacement items. The Company
anticipates financing these expenditures through internal cash flow and cash
reserves.
The Company's line of credit remains unchanged from that noted in the June 30,
1995 Annual Report to Shareholders.
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PART II. OTHER INFORMATION
Item 4(c). Submission of Matters to a Vote of Security Holders
On October 26, 1995, the Company held its 1995 Annual Shareholders Meeting.
Shareholders voted proxies representing 3,589,582 shares which was 84.4% of
the 4,254,064 shares outstanding on the record date. The proposed slate of
officers were elected with 3,568,846 shares and the selected independent
accountants were ratified with 3,583,262 shares.
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INTERNATIONAL ALUMINUM CORPORATION
AND SUBSIDIARIES
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
International Aluminum Corporation
(Registrant)
Date February 12, 1996 DAVID C. TREINEN
David C. Treinen
Senior Vice President - Finance
and Administration
(Principal Financial Officer)
Date February 12, 1996 MITCHELL K. FOGELMAN
Mitchell K. Fogelman
Vice President - Controller
(Principal Accounting Officer)
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<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-END> DEC-31-1995
<CASH> 8,923
<SECURITIES> 0
<RECEIVABLES> 35,501
<ALLOWANCES> 0
<INVENTORY> 38,358
<CURRENT-ASSETS> 86,579
<PP&E> 99,825
<DEPRECIATION> 53,392
<TOTAL-ASSETS> 138,830
<CURRENT-LIABILITIES> 17,980
<BONDS> 258
0
0
<COMMON> 8,417
<OTHER-SE> 107,289
<TOTAL-LIABILITY-AND-EQUITY> 138,830
<SALES> 110,392
<TOTAL-REVENUES> 110,392
<CGS> 79,484
<TOTAL-COSTS> 103,639
<OTHER-EXPENSES> (70)
<LOSS-PROVISION> 434
<INTEREST-EXPENSE> 27
<INCOME-PRETAX> 6,823
<INCOME-TAX> 2,730
<INCOME-CONTINUING> 4,093
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,093
<EPS-PRIMARY> .96
<EPS-DILUTED> 0
</TABLE>
