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 for the fiscal year ended December 31, 1993
Transition report pursuant to Section 15(d) of the Securities
- - ---- Exchange Act of 1934 for the transition period from __ to __
Commission file number 0-2251
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
Savings Plan of the SCI Systems, Inc. Employee Financial
Security Program
B. Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office:
SCI Systems, Inc.
2101 Clinton Ave. West
Huntsville, Alabama 35805
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustee (or other persons who administer the employee benefit plan) have duly
caused this annual report to be signed on its behalf by the undersigned here-
unto duly authorized.
Savings Plan of the SCI Systems, Inc.
Employee Financial Security Program
Date: June 29, 1994 By: /s/ Michael M. Sullivan
-------------------------
Michael M. Sullivan
Corporate Secretary
<PAGE>
SAVINGS PLAN OF THE
SCI SYSTEMS, INC.
EMPLOYEE FINANCIAL SECURITY PROGRAM
FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULES
Years Ended December 31, 1993 and 1992
with Report of Independent Auditors
<PAGE>
Savings Plan of the SCI Systems, Inc.
Employee Financial Security Program
Financial Statements
and Supplemental Schedules
Years ended December 31, 1993 and 1992
CONTENTS
Report of Independent Auditors .............................................1
Financial Statements
Statements of Net Assets Available for Benefits ............................2
Statements of Changes in Net Assets Available for Benefits .................4
Notes to Financial Statements ..............................................6
Supplemental Schedules
Item 27a - Schedule of Assets Held for Investment Purposes ................13
Item 27d - Schedule of Reportable Transactions ............................14
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Administrative Committee
Savings Plan of the SCI Systems, Inc. Employee Financial Security Program
We have audited the accompanying statements of net assets available for
benefits of the Savings Plan of the SCI Systems, Inc., Employee Financial
Security Program as of December 31, 1993 and 1992, and the related statements
of changes in net assets available for benefits for the years 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 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 net assets available for benefits of the Plan at
December 31, 1993 and 1992, and the changes in its net assets available for
benefits for the years then ended in conformity with generally accepted
accounting principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedules
of assets held for investment purposes as of December 31, 1993 and reportable
transactions for the year ended December 31, 1993, are presented for the
purposes of complying with the Department of Labor's Rules and regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974, and are not a required part of the basic financial statements. The
supplemental schedules have been subjected to the auditing procedures applied
in our audit of the 1993 financial statements and, in our opinion, are fairly
stated in all material respects in relation to the 1993 basic financial
statements taken as a whole.
Birmingham, Alabama Ernst & Young
June 15, 1994
<PAGE>
<TABLE>
Savings Plan of the SCI Systems, Inc.
Employee Financial Security Program
Statement of Net Assets Available for Benefits
December 31, 1993
<CAPTION>
<C> <C> <C> <C> <C> <C>
Money SCI
Market Stock Balanced Equity G I C
Fund Fund Fund Fund Fund Total
<S>
ASSETS
Cash $ 6 $ 6 $ 14 $ 8 $ 508 $ 542
Investments at fair value 5,538,193 5,533,106 7,861,470 5,542,218 7,906,964 32,381,951
Accrued interest receivable 17 12 43 40 52 164
---------- ---------- ---------- ---------- ---------- -----------
Total assets 5,538,216 5,533,124 7,861,527 5,542,266 7,907,524 32,382,657
LIABILITIES
Distributions payable to participants 77,816 63,530 91,185 48,944 54,429 335,904
---------- ---------- ---------- ---------- ---------- -----------
Total liabilities 77,816 63,530 91,185 48,944 54,429 335,904
Net assets available for benefits $5,460,400 $5,469,594 $7,770,342 $5,493,322 $7,853,095 $32,046,753
========== ========== ========== ========== ========== ===========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
Savings Plan of the SCI Systems, Inc.
Employee Financial Security Program
Statement of Net Assets Available for Benefits (Restated)
December 31, 1992
<CAPTION>
<C> <C> <C> <C> <C> <C>
Money SCI
Market Stock Balanced Equity G I C
Fund Fund Fund Fund Fund Total
<S>
ASSETS
Cash $ 0 $ 0 $ 1 $ 1 $ 1 $ 3
Investments at fair value 4,726,096 7,002,504 5,778,259 4,131,291 6,440,944 28,079,094
Accrued interest receivable 11,286 104 102 146 30,390 42,028
Contributions receivable 31,502 122,700 63,166 45,769 91,621 354,758
---------- ---------- ---------- ---------- ---------- -----------
Total assets 4,768,884 7,125,308 5,841,528 4,177,207 6,562,956 28,475,883
LIABILITIES
Distributions payable to participants 77,868 110,765 105,705 93,176 223,317 610,831
---------- ---------- ---------- ---------- ---------- -----------
Total liabilities 77,868 110,765 105,705 93,176 223,317 610,831
Net assets available for benefits $4,691,016 $7,014,543 $5,735,823 $4,084,031 $6,339,639 $27,865,052
========== ========== ========== ========== ========== ===========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
Savings Plan of the SCI Systems, Inc.
Employee Financial Security Program
Statement of Changes in Net Assets Available for Benefits
December 31, 1993
<CAPTION>
<C> <C> <C> <C> <C> <C>
Money SCI
Market Stock Balanced Equity G I C
Fund Fund Fund Fund Fund Total
<S>
ADDITIONS
Employee contributions $ 417,050 $ 559,254 $1,120,700 $ 741,737 $1,487,810 $ 4,326,551
Employer contributions 191,571 52,019 266,172 176,527 325,271 1,011,560
---------- ---------- ---------- ---------- ---------- -----------
608,621 611,273 1,386,872 918,264 1,813,081 5,338,111
Interest Income 156,908 790 2,569 1,314 225,107 386,688
Dividends received 280,368 81,422 361,790
Net realized and unrealized appreciation
in the fair value of the investments 26 ( 175,705) 223,415 260,279 91,258 399,273
---------- ---------- ---------- ---------- ---------- -----------
765,555 436,358 1,893,224 1,261,279 2,129,446 6,485,862
DEDUCTIONS
Distributions to participants 429,251 425,321 584,072 325,842 539,675 2,304,161
Inter-fund transfers 433,080 (1,555,986) 725,367 473,854 ( 76,315) 0
---------- ---------- ---------- ---------- ---------- -----------
Net increase 769,384 (1,544,949) 2,034,519 1,409,291 1,513,456 4,181,701
Net assets available for benefits at
beginning of year 4,691,016 7,014,543 5,735,823 4,084,031 6,339,639 27,865,052
---------- ---------- ---------- ---------- ---------- -----------
Net assets available for benefits at
end of year $5,460,400 $5,469,594 $7,770,342 $5,493,322 7,853,095 $32,046,753
========== ========== ========== ========== ========== ===========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
Savings Plan of the SCI Systems, Inc.
Employee Financial Security Program
Statement of Changes in Net Assets Available for Benefits
Year Ended December 31, 1992 (Restated)
<CAPTION>
<C> <C> <C> <C> <C> <C>
Money SCI
Market Stock Balanced Equity G I C
Fund Fund Fund Fund Fund Total
<S>
ADDITIONS
Employees $ 402,301 $ 489,283 $ 756,146 $ 585,000 $1,469,989 $ 3,702,719
Employer 197,466 146,806 234,306 162,106 330,044 1,070,728
---------- ---------- ---------- ---------- ---------- -----------
599,767 636,089 990,452 747,106 1,800,033 4,773,447
Interest Income 177,511 997 293,915 748 323,286 796,457
Dividends received 358,670 269,050 627,720
Net realized and unrealized appreciation
in the fair value of the investments 1,186 2,832,337 965,827 918,319 15,811 4,733,480
---------- ---------- ---------- ---------- ---------- -----------
778,464 3,469,423 2,608,864 1,935,223 2,139,130 10,931,104
DEDUCTIONS
Distributions to participants 566,829 502,598 606,024 434,732 628,023 2,738,206
Inter-fund transfers ( 155,404) ( 318,685) 195,448 123,256 155,385 0
---------- ---------- ---------- ---------- ---------- -----------
Net increase 56,231 2,648,140 2,198,288 1,623,747 1,666,482 8,192,898
Net assets available for benefits at
beginning of year 4,634,785 4,366,403 3,537,535 2,460,284 4,673,147 19,672,154
---------- ---------- ---------- ---------- ---------- -----------
Net assets available for benefits at
end of year $4,691,016 $7,014,543 $5,735,823 $4,084,031 $6,339,639 $27,865,052
========== ========== ========== ========== ========== ===========
</TABLE>
See accompanying notes.
<PAGE>
Savings Plan of the SCI Systems, Inc.
Employee Financial Security Program
Notes to Financial Statements
December 31, 1993
1. ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accounting records of the Savings Plan of the SCI Systems, Inc., Employee
Financial Security Program (the Plan) are maintained on the accrual basis.
RESTATEMENT OF PRIOR YEAR FINANCIAL STATEMENTS
The Plan's Administrator determined that the net assets of the Deferred Compen-
sation Plan of the SCI Systems, Inc. Employee Financial Security Program should
be reported separately from the net assets of the Savings Plan of the SCI
Systems, Inc. Employee Financial Security Program. Thus, the 1992 financial
statements have been restated to exclude the net assets of the Deferred Compen-
sation Plan of the SCI Systems, Inc. Employee Financial Security Program.
This restatement reduced previously reported net assets available for benefits
at December 31, 1992 by $2,884,277 and additions to and deductions from net
assets available for benefits for the year ended December 31, 1992 by
$1,152,604 and $588,973, respectively.
VALUATION OF INVESTMENTS
Marketable securities are stated at fair value, determined by the last trade
at December 31. The fair value of mutual funds and separate accounts are
based on quoted redemption values at December 31. Separate accounts that do
not have an established fair value are stated at aggregate fair value at
December 31, as determined by the Plan's trustee. The change in the difference
between fair value and the cost of investments is reflected in the statements
of changes in net assets available for benefits as unrealized appreciation
(depreciation) in the fair value of investments. The realized gain or loss
on investments is the difference between the proceeds received and the average
cost of the investments sold.
2. DESCRIPTION OF THE PLAN
GENERAL
The following description of the Plan provides only general information.
Participants should refer to the Plan agreement for a more complete
description of the Plan's provisions.
ELIGIBILITY
Membership is voluntary and is available to all United States employees of
SCI Systems, Inc. and Subsidiaries (the Company) who have completed 500 hours
of service within the six-month period beginning on the day they start their
employment.
PARTICIPATION
Employees may enter the Plan on any January 1, April 1, July 1, or October 1
after meeting the eligibility requirements.
VESTING
Substantially all of the Plan's assets are vested in its members. Member
contributions are fully vested and the Company's matching portion is fully
vested after 5 years. Upon death or retirement at age 65, a member will be
paid his share of the Plan assets. A member may withdraw from the Plan and
receive his share representing his own contributions together with his pro rata
share of net income.
CONTRIBUTIONS
The Company maintains payroll deduction accounts for all participating
employees. Employees may authorize withholdings up to 15% of their earnings
in 1/2% increments as a before-tax contribution or in 1% increments as an
after-tax contribution. The maximum payroll deduction of 15% can consist of
matched and unmatched before-tax and after-tax savings in any combination.
The current tax law also places an annual limitation of $ 8,994 for the
amount of before-tax savings an employee can contribute to the Plan for 1993.
The Company may contribute amounts up to 40% of any employee's before-tax
matched savings and 60% of their after-tax matched savings. The actual matched
contribution amount is dependent on years of service and compensation levels.
INVESTMENT PROGRAM
Each member is entitled to direct the investment of his account to each of
the separate funds as follows: "Money Market Fund" -- Investments in
government securities, commercial paper, time deposits or certificates of
deposit maturing within one year; "SCI Stock Fund" -- Investments in qualifying
securities of the company; "Balanced Fund" -- Investments in a combination of
stocks and fixed income securities in order to provide a balance of high yield
and safety; "Equity Fund" -- Investments primarily in a diversified portfolio
of common stocks expected to have earnings and dividend growth potential
greater than the economy in general; and "Guaranteed Interest Contract (GIC)
Fund" -- Investments in contracts which provide a fixed rate of return.
ADMINISTRATION
The Plan is administered by a three member Administrative Committee
appointed by the Board of Directors of the Company.
TRUSTEE
First Alabama Bank of Huntsville, N.A. operated as Trustee of the plan until
September 30, 1993. Effective October 1, 1993 Mellon Bank replaced First
Alabama as trustee of the Plan and holds the Plan's assets.
TERMINATION OF THE PLAN
The Company has the right under the Plan to discontinue contributions at any
time and terminate the Plan. In the event of a termination of the Plan, the
net assets of the Plan are to be distributed to the members on the basis of
the number of units credited to each.
PLAN AMENDMENT
The Plan was amended effective July 1, 1991 to merge the remaining accounts of
the terminated PAYSOP Plan into this Plan effective January 1, 1992 to achieve
administrative efficiency in their disposition.
3. WITHDRAWALS AND FORFEITURES
Withdrawals and forfeitures by Plan participants for the years ended
December 31, 1992 and 1991 were as follows:
1993 1992
Balances of employee's accounts withdrawn
or forfeited $2,347,338 $3,455,325
Amounts disbursed by the Plan in settlement of the
above balances $2,304,161 $3,331,118
---------- ----------
Reduction of employer's contribution due to
forfeited amounts $ 43,177 $ 124,207
======================
The Plan agreement provides that the employer contribution to the Plan is
reduced by the amount of forfeitures.
4. TRANSACTIONS WITH PARTIES IN INTEREST
All trustee expenses, legal, accounting and other services in connection with
the administration and operation of the Plan are paid by the Company.
5. INCOME TAX STATUS
The Internal Revenue Service has ruled that the Plan qualifies under
Section 401 (a) of the Internal Revenue Code and is, therefore, not subject to
tax under present income tax law.
<PAGE>
6. INVESTMENTS
The cost of investments at December 31, 1993 and 1992 is summarized as
follows:
1993 1992
Mellon Bank Time Deposit Fund $ 663,322 $ 0
First Alabama Bank of Huntsville, N.A.
Time Open Short-Term Notes 0 627,515
Vanguard Money Market Fund 5,479,465 4,689,296
Provident National Assurance Mutual Fund 0 1
SCI Systems, Inc. common stock 3,554,678 4,104,563
First Alabama Bank Investment Contract Fund 5,173,083 3,543,892
Trustee's GIC Fund 2,491,882 2,453,515
MAS Pooled Trust Fund Equity Portfolio
(Balanced Fund) 4,012,547 2,296,131
MAS Fixed Income Portfolio 3,152,318 2,534,092
MAS Pooled Trust Fund Equity Portfolio
(Equity Fund) 4,708,609 3,191,775
----------- -----------
$29,235,904 $23,440,780
========================
<PAGE>
The fair value of individual investments that represent 5% or more of the
Plan's net assets as December 31, 1993 and 1992 are as follows:
1993 1992
Vanguard Money Market Fund $ 5,479,465 $ 4,689,270
SCI Systems, Inc. common stock 5,509,170 6,951,115
First Alabama Bank Investment Contract Fund 5,193,801 3,559,383
Trustee's GIC Fund 2,579,618 2,453,515
MAS Equity Fund 4,464,585 2,989,734
MAS Fixed Income Fund 3,177,508 2,726,941
MAS Equity Fund 5,314,482 4,080,839
----------- -----------
$31,718,629 $27,450,797
========================
<PAGE>
During 1993 and 1992, the Plan's investments that were bought, sold, as well
as held during the year appreciated (depreciated) in fair value by $399,273
and $4,733,480, as follows:
1993 1992
Vanguard Money Market Fund $ 26 $ 858
Provident National Assurance Mutual Fund 0 328
SCI Systems, Inc. common stock (175,705) 2,832,337
First Alabama Bank Investment Contract Fund 3,522 15,811
Trustee's GIC Fund 87,736 0
MAS Trust Fund Equity Portfolio (Balanced Fund) 8,810 742,492
MAS Fixed Income Fund 214,605 223,335
MAS Trust Fund Equity Portfolio (Equity Fund) 260,279 918,319
----------- -----------
$ 399,273 $ 4,733,480
========================
<PAGE>
SUPPLEMENTAL SCHEDULES
<PAGE>
<TABLE>
Savings Plan of the SCI Systems, Inc.
Employee Financial Security Program
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1993
<CAPTION>
<C> <C> <C>
Number
of Shares
or Current Current
Name of Issuer and Title of Issue Par Value Cost Value
- - -----------------------------------------------------------------------------------------------
MONEY MARKET FUND Mellon Bank Time Deposit Fund* 58,728 $ 58,728 $ 58,728
Vanguard Money Market Fund 5,479,465 5,479,465 5,479,465
5,538,193 5,538,193
- - -----------------------------------------------------------------------------------------------
SCI STOCK FUND Mellon Bank Time Deposit Fund* 23,936 23,936 23,936
SCI Systems Common Stock * 312,577 3,554,678 5,509,170
3,578,614 5,533,106
- - -----------------------------------------------------------------------------------------------
G I C FUND Mellon Bank Time Deposit Fund* 133,545 133,545 133,545
First Alabama Bank Investment
Contract Fund* 332,258 5,173,083 5,193,801
Trustee's GIC Fund 149,739 2,491,882 2,579,618
7,798,510 7,906,964
- - -----------------------------------------------------------------------------------------------
BALANCED FUND Mellon Bank Time Deposit Fund* 219,377 219,377 219,377
MAS Fixed Income Portfolio 268,597 3,152,318 3,177,508
MAS Trust Fund Equity Portfolio 211,893 4,012,547 4,464,585
7,384,242 7,861,470
- - -----------------------------------------------------------------------------------------------
EQUITY FUND Mellon Bank Time Deposit Fund* 227,736 227,736 227,736
MAS Equity Portfolio 252,230 4,708,609 5,314,482
4,936,345 5,542,218
- - -----------------------------------------------------------------------------------------------
29,235,904 32,381,951
===============================================================================================
</TABLE>
* Party - in - interest
<PAGE>
<TABLE>
Savings Plan of the SCI Systems, Inc.
Employee Financial Security Program
Item 27d - Schedule of Reportable Transactions
Year ended December 31, 1993
<CAPTION>
<C> <C> <C> <C> <C> <C> <C> <C>
Current
Value
No. of of Asset
Identity of Description Trans- Purchase Selling Cost of on Date of Net Gain
Party Involved of Assets actions Price Price Assets Transaction (Loss)
- - ------------------------------------------------------------------------------------------------------------------------
First Alabama Bank $9,780,863 par of 331 $ 9,780,863 $ 0 $ 9,780,863 $ 9,780,863 $ 0
of Huntsville, N.A. First Alabama Bank
of Huntsville, N.A.
Time Open Short-
Term Notes
First Alabama Bank $9,724,948 par of 214 10,408,378 10,408,378 10,408,378 0
of Huntsville, N.A. First Alabama Bank
of Huntsville, N.A.
Time Open Short-
Term Notes
First Alabama Bank 1,629,191 units of 14 1,629,191 1,629,191 1,629,191 0
of Huntsville, N.A. FAB Investment
Contract Fund
SCI Systems, Inc 19,373 shares of 11 371,489 371,489 371,489 0
common stock
SCI Systems, Inc 85,427 shares of 17 1,656,772 921,374 1,656,772 735,398
common stock
MAS 1,783,079 units of 22 1,783,079 1,783,079 1,783,079 0
MAS Pooled Trust Fund
Equity Portfolio
(Balanced Fund)
MAS 66,663 units of MAS 7 66,663 66,663 66,663 0
MAS Pooled Trust Fund
Equity Portfolio
(Balanced Fund)
MAS 1,592,424 units of 21 1,592,424 1,592,424 1,592,424 0
MAS Pooled Trust Fund
Equity Portfolio
(Equity Fund)
MAS 75,990 units of 8 75,590 75,590 75,590 0
MAS Pooled Trust Fund
Equity Portfolio
(Balanced Fund)
Mellon Bank $2,124,980 par of 123 2,124,980 2,124,980 2,124,980 0
Mellon Bank
Time Deposit Fund
Mellon Bank $1,461,658 par of 28 1,461,658 1,461,658 1,461,658 0
Mellon Bank
Time Deposit Fund
</TABLE>
<PAGE>
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in Amendment Number One to the
Registration Statement (Number 2-86230 on Form S-8 dated September 15, 1983)
pertaining to the Savings Plan of the SCI Systems, Inc., Employee Financial
Security Program and our report dated June 15, 1994, with respect to the
financial statements and schedules of the Savings Plan of the SCI Systems, Inc.,
Employee Financial Security Program included in this Annual Report (Form 11-K)
for the year ended December 31, 1993.
Ernst & Young
Birmingham, Alabama
June 28, 1994
