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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 1994 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
Identification No.)
767 Monterey Pass Road, Monterey Park, California 91754
(213) 264-1670
(Address of principal executive office
(Telephone Number)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Each Exchange on
Which Registered
Common Stock ($1.00 Par Value) New York Stock
Exchange, Inc.
Pacific Stock
Exchange, Inc.
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 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
Indicate by check mark if disclosure of delinquent filers
pursuant to Item
405 of Regulation S-K is not contained herein, and will not be
contained, to
the best of Registrant's knowledge, in definitive proxy or
information
statements incorporated by reference in Part III of this Form
10-K or any
amendment to this Form 10-K.
At September 7, 1994 there were 4,234,762 shares of Registrant's
Common Stock
outstanding. The aggregate market value of shares held by
non-affiliates was
$64,258,369 based on the Composite Tape closing price on that
date.
DOCUMENTS INCORPORATED BY REFERENCE
1. Registrant's Annual Report to Shareholders for the fiscal year
ended
June 30, 1994, pages 4 through 16, are incorporated by
reference into
Parts I and II.
2. Registrant's Proxy Statement dated September 22, 1994 for the
Annual
Meeting of Shareholders to be held on October 27, 1994 is
incorporated by
reference, other than the performance graph and Compensation
Committee
Report, into Part III.
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PART I
ITEM 1. BUSINESS
a. GENERAL DEVELOPMENT OF BUSINESS
International Aluminum Corporation is an integrated
manufacturer and
supplier of a broad line of quality aluminum, wood, vinyl and
glass products.
The Company was incorporated in California in 1963 as successor
to an aluminum
fabricating business begun in 1957 and maintains its executive
offices at 767
Monterey Pass Road, Monterey Park, California 91754. The
Company's telephone
number is (213) 264-1670. Reference to the "Registrant",
"International
Aluminum Corporation" or the "Company" includes International
Aluminum
Corporation and its subsidiaries unless the context indicates
otherwise.
b. INDUSTRY SEGMENTS, LINES OF BUSINESS AND CLASSES OF PRODUCTS
This information is included on pages 4 and 13
respectively, of the
Registrant's 1994 Annual Report to Shareholders and is hereby
incorporated by
reference.
c. NARRATIVE DESCRIPTION OF BUSINESS
Processes and Products
Building Products
Residential. Residential products are fabricated from
aluminum, wood and
vinyl into a broad line of sliding windows, single hung
windows, double hung
windows, casement windows, garden windows, bay and bow windows,
special
configuration windows, louvre windows, storm sash, patio doors,
tub
enclosures, shower doors, wardrobe mirror doors and related
products.
These products are used in new residential construction and in
remodeling,
home improvement and replacement.
Commercial. Commercial products are fabricated from
aluminum into curtain
walls, window walls, storefront framing, commercial windows,
entrance doors
and frames, interior doors and frames and interior wall
systems. These
products are utilized in varying combinations to produce
systems used for
office and commercial construction, remodeling and tenant
improvement
applications.
Aluminum Extrusions. In the extrusion process, heated
aluminum billets
are hydraulically forced through steel dies to produce a piece
of metal of
the desired length and cross-section shape. The extrusions are
then cut and,
when requested, anodized or painted in a variety of finishes in
the Company's
anodizing and painting departments.
The Company currently has five extrusion presses at its
Alhambra,
California plant and three presses at its plant in Waxahachie,
Texas.
- 1 -
Aluminum extrusions produced by the Company are used in
fabricating
substantially all of its other aluminum products. In addition,
during fiscal
1994 approximately 52% of the extrusions produced were sold to
users in its
own or other industries, including manufacturers of fixtures,
electronic
equipment, fitness products, sailboats, skylights and truck
bodies. The
Company furnishes design services to assist its customers in
developing or
better utilizing custom extrusions.
Glass Products
This product group shapes, bends, bevels, etches, polishes
and tempers
bulk flat glass. The fabricated glass is primarily utilized in
the Company's
glass furniture lines and in its line of modular store display
systems.
Glass is also processed to customer specifications for
incorporation into
their end products, which include residential, patio and office
furniture,
truck and recreational vehicle windows, light fixtures and
appliances.
Sales and Distribution
The Company markets its residential and commercial building
products
primarily to independent dealers and distributors, with whom
the Company
has no long-term contracts. Aluminum extrusions are marketed
principally
by direct sales to other manufacturers, some of which produce
aluminum
products of the Company's design. The Company's glass products
are
marketed to manufacturers, distributors and retailers.
Each of the Company's subsidiaries has its own
administrative and sales
organizations. Sales are made largely in the United States,
Europe and
Mexico.
No customer accounted for more than 3% of net sales in
1994, and no
material part of the business is dependent upon a single
customer or a few
customers, the loss of any one or more of whom would have a
materially
adverse effect on the business of the Company. The Company
does business
on a current basis and has no significant backlog of unfilled
firm orders.
Materials
The Company purchases its aluminum ingot requirements from
primary
aluminum producers or spot metal brokers. Although increased
worldwide
demand produces periods of tight supply of aluminum ingot and
scrap, the
Company has had satisfactory experience to date in obtaining
sufficient raw
materials to meet its requirements and does not anticipate
material
shortages which would significantly hamper its operations.
Bulk glass is purchased from domestic glass manufacturers.
The Company
has had satisfactory experience to date in obtaining sufficient
glass to
meet its requirements.
The Company produces the aluminum extrusions used in the
products it
manufactures and sells. Wood, vinyl, hardware, fasteners and
screening are
purchased from outside sources.
- 2 -
Seasonality
Sales of products designed for residential and commercial
applications are
subject to cyclical swings in new construction and seasonal
fluctuations
due to reduced construction activity in some marketing areas
during the
winter months (second and third quarters).
Working Capital
To maintain an adequate supply of aluminum to meet customer
delivery
requirements and to assure itself of a continuous allotment of
materials
from its suppliers, the Company at times carries a significant
inventory of
aluminum ingot. Depending on price and availability, bulk
quantities of
ingot are purchased from either primary aluminum producers or
from spot
metal brokers.
The Company does not believe there are any abnormal working
capital
requirements associated with any of its product groups as
merchandise is
normally produced for specific customer orders or shipped from
inventory
and as a general practice extended payment terms are not
granted to customers.
Patents
The Company has no material patents, either issued or
pending, and is
not a party to any significant licensing agreements.
Competition and Risk
The business of International Aluminum is highly
competitive. Competition
in all product lines is on the basis of price, service and
product quality.
The manner and extent of such competition depends on the
product being
marketed and the relevant marketing area. In selling its
residential
products to dealers and distributors, the Company faces
competition
primarily from numerous fabricators. The Company's major
competitors in
selling commercial products and aluminum extrusions are
substantially
larger, more diversified and have greater resources than the
Company.
The Company anticipates that expansion of its product lines
may result
in its competing with certain of its present customers. While
the Company
cannot accurately predict the effect, if any, that such
development will
have on its business, the Company anticipates no material
adverse effect.
Since a substantial portion of the Company's business is
connected with
residential and commercial building construction, any
significant decrease
in new or remodeling construction could adversely affect
revenues.
Experience has shown that high interest rates for construction
financing
and residential mortgage and home improvement loans may
adversely affect
revenues.
- 3 -
Environmental Controls
The Company's domestic aluminum extrusion, anodizing,
painting and
manufacturing facilities are subject to water and air pollution
control
standards mandated by federal, state and local law. While the
Company
anticipates no material capital expenditures to meet
established
environmental quality control standards, there can be no
assurance that
more stringent standards will not be established which might
require such
expenditures.
Employees
As of June 30, 1994, the Company had approximately 1,900
full-time
employees.
d. FINANCIAL INFORMATION ABOUT FOREIGN AND DOMESTIC
OPERATIONS
The information concerning sales, net income and
identifiable assets of
foreign and domestic operations for fiscal years 1994, 1993 and
1992 is set
forth in Note 10 to the consolidated financial statements
included on page
13 of the Company's 1994 Annual Report incorporated herein by
reference.
- 4 -
ITEM 2. PROPERTIES
The following table sets forth information concerning the
location,
size and use of the Company's present facilities:
Square
Location Feet (1) Use
Building Products:
Alhambra, California 214,000 Aluminum
extrusions, foundry,
anodizing and
painting
Waxahachie, Texas 206,000 Aluminum
extrusions, foundry,
anodizing and
painting
South Gate, California 189,000 Residential
products
Hayward, California 103,000 Residential
products
Phoenix, Arizona 57,000 Residential
products
Riverside, California 40,000(L) Residential
products
Vernon, California 134,000 Commercial
products
Bedford Park, Illinois 81,000 Commercial
products
Waxahachie, Texas 134,000 Commercial
products
Denver, Colorado 16,000(L) Commercial
Products
Rock Hill, South Carolina 74,000(E) Commercial
products
Bridgeport, New Jersey 81,000 Commercial
products
Houston, Texas 57,000 Commercial
products
Dallas, Texas 15,000 Commercial
products
Waxahachie, Texas 60,000 Commercial
products
Amsterdam, the Netherlands 165,000 Commercial and
residential
products
Glass Products:
South Gate, California 86,000(L) Glass
fabrication and tempering
Rock Hill, South Carolina 84,000(E) Glass
fabrication and tempering
Administration:
Monterey Park, California 19,000(L) Executive
offices
______________________
(1) Includes manufacturing, warehouse and office space;
excludes construction
in process, parking and yard storage space.
(E) Indicates encumberment of real property.
(L) Indicates leased premises.
Of the 1,815,000 square feet exhibited above, 1,654,000
square feet are
owned by the Company. The balance of 161,000 square feet is
leased under
agreements expiring at various dates. The Company believes
that its
facilities are adequate for anticipated levels of operations.
- 5 -
ITEM 3. LEGAL PROCEEDINGS
The Company has litigation pending, both offensive and
defensive, arising
from the conduct of its business, none of which are expected to
have any
material effect on the Company's financial position.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters have been submitted to a vote of security
holders which are
required to be reported under the instructions to this item.
- 6 -
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED
STOCK
HOLDER MATTERS
The market and dividend information is included on pages
14 and 16 of the
Company's 1994 Annual Report to Shareholders and is
incorporated herein by
reference.
There are no restrictions of future cash dividends.
There were approximately 600 shareholders of record of the
Company's
common stock at June 30, 1994.
ITEM 6. SELECTED FINANCIAL DATA
Selected financial data pertaining to the Company for the
last five years
is set forth on page 4 of the Company's 1994 Annual Report to
Shareholders and
is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION
AND RESULTS OF OPERATIONS
This information is set forth on pages 4 and 5 of the
Company's 1994
Annual Report to Shareholders and is incorporated herein by
reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
See Part IV, Item 14.
ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
There have been no disagreements which are required to be
reported
under the instructions to this item.
PART III
The information required under Part III is contained in
the Company's
Proxy Statement for the Annual Meeting of Shareholders to be
held
October 27, 1994, which information is incorporated herein by
reference.
- 7 -
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
Page
(a) 1. Financial Statements
Consolidated Financial Statements (See Note):
Balance sheets - June 30, 1994 and 1993
Statements for the three years ended June 30, 1994 -
Income
Shareholders' equity
Cash flows
Notes to consolidated financial statements
2. Financial Statement Schedules
Report of Independent Accountants on Financial
Statement Schedules
F-1
Schedules for the three years ended June 30, 1994 -
V Property, plant and equipment
F-2
VI Accumulated depreciation of property, plant
and equipment
F-3
VIII Valuation and qualifying accounts
F-4
X Supplementary income statement information
F-5
3. Exhibits
3. Articles of incorporation and by-laws. This information is
set forth as
Exhibits 2.2 and 2.3 to the September 9, 1977 Registration
Statement on Form
S-7, and was amended by Proxy Statements dated September 26, 1978
and
September 21, 1988 furnished to shareholders in connection with
the related
Annual Meeting of Shareholders held on October 26, 1978 and
October 27, 1988,
respectively. These documents were filed by the Registrant with
the
Securities and Exchange Commission and are incorporated herein by
reference.
4. Instruments defining the rights of security holders,
including indentures.
This information is set forth on page 10 of the August 1, 1968
Registration
Statement on Form S-1, as amended, filed by the Registrant with
the
Securities and Exchange Commission and is incorporated herein by
reference.
13. Annual report to security holders, Form 10-Q or quarterly
report to
security holders.
22. Subsidiaries of the registrant.
(b) No reports on Form 8-K were required to be filed during the
last quarter of
1994.
NOTE: The consolidated statements referred to above are included
in the 1994
Annual Report to Shareholders and are incorporated herein
by reference.
No section of the Annual Report to Shareholders other than
pages 4
through 16 is deemed to be filed with the Commission.
- 8 -
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities
Exchange Act of 1934, the Registrant has duly caused this report
to be signed
on its behalf by the undersigned, thereto duly authorized.
INTERNATIONAL
ALUMINUM CORPORATION
Date: September 20, 1994 By: DAVID C.
TREINEN
David C.
Treinen
Vice
President-Finance; Secretary
and Chief
Financial 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 and on the dates indicated.
Signature Title
Date
CORNELIUS C. VANDERSTAR Chairman of the Board and
September 20, 1994
Cornelius C. Vanderstar Chief Executive Officer
JOHN P. CUNNINGHAM Director, President and
September 20, 1994
John P. Cunningham Chief Operating Officer
HUGH E. CURRAN Director and Vice President-
September 20, 1994
Hugh E. Curran Sales
DAVID C. TREINEN Director and Vice President-
September 20, 1994
David C. Treinen Finance; Secretary and
Chief Financial Officer
MITCHELL K. FOGELMAN Asst. Vice President-Finance;
September 20, 1994
Mitchell K. Fogelman Controller and Chief
Accounting Officer
JOEL F. McINTYRE Director
September 20, 1994
Joel F. McIntyre
ALEXANDER VAN DE POL Director
September 20, 1994
Alexander van de Pol
DONALD J. WILLFONG Director
September 20, 1994
Donald J. Willfong
- 9 -
REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT
SCHEDULES
To the Board of Directors of
International Aluminum Corporation
Our audits of the consolidated financial statements referred to
in our report
dated August 17, 1994 appearing on page 15 of the 1994 Annual
Report to
Shareholders of International Aluminum Corporation (which
report and
consolidated financial statements are incorporated by reference
in this
Annual Report on Form 10-K) also included an audit of the
Financial
Statement Schedules listed in Item 14(a)2 of this Form 10-K.
In our
opinion, these Financial Statement Schedules present fairly, in
all
material respects, the information set forth therein when read
in
conjunction with the related consolidated financial statements.
PRICE WATERHOUSE LLP
Los Angeles, California
August 17, 1994
F-1
INTERNATIONAL ALUMINUM CORPORATION AND
SUBSIDIARIES
SCHEDULE V - PROPERTY, PLANT AND
EQUIPMENT
For The Three Years Ended June 30,
1994
Balance at
Balance at
Beginning Additions
Retirements Translation End
Classification of Year at Cost
and Sales Transfers Adjustment of Year
Year ended June 30, 1994
Land $ 6,925,000 $ 340,000
$ - $ - $ (13,000) $ 7,252,000
Buildings and improvements 27,766,000 83,000
10,000 214,000 (138,000) 27,915,000
Machinery and equipment 49,878,000 3,652,000
925,000 270,000 (121,000) 52,754,000
Construction in process - 484,000
- (484,000) - -
$84,569,000 $4,559,000
$ 935,000 $ - $ (272,000) $87,921,000
Year ended June 30, 1993
Land $ 6,919,000 $ -
$ - $ - $ 6,000 $ 6,925,000
Buildings and improvements 27,096,000 133,000
- 469,000 68,000 27,766,000
Machinery and equipment 48,523,000 2,851,000
1,584,000 29,000 59,000 49,878,000
Construction in process 25,000 495,000
15,000 (498,000) (7,000) -
$82,563,000 $3,479,000
$1,599,000 $ - $ 126,000 $84,569,000
Year ended June 30, 1992
Land $ 6,945,000 $ 92,000
$ 155,000 $ - $ 37,000 $ 6,919,000
Buildings and improvements 26,468,000 48,000
- 288,000 292,000 27,096,000
Machinery and equipment 47,004,000 1,542,000
1,143,000 863,000 257,000 48,523,000
Construction in process 618,000 558,000
- (1,151,000) - 25,000
$81,035,000 $2,240,000
$1,298,000 $ - $ 586,000 $82,563,000
/TABLE
INTERNATIONAL ALUMINUM CORPORATION AND
SUBSIDIARIES
SCHEDULE VI - ACCUMULATED DEPRECIATION AND
AMORTIZATION
OF PROPERTY, PLANT AND
EQUIPMENT
For The Three Years Ended June 30,
1994
Balance at
Additions Balance at
Beginning Charged
to Retirements Translation End
Classification of Year Income
(1) and Sales Adjustment of Year
Year ended June 30, 1994
Buildings and improvements $ 9,840,000 $
754,000 $ 1,000 $ (93,000) $10,500,000
Machinery and equipment 34,688,000
3,809,000 764,000 (100,000) 37,633,000
$44,528,000
$4,563,000 $ 765,000 $ (193,000) $48,133,000
Year ended June 30, 1993
Buildings and improvements $ 9,020,000 $
780,000 $ - $ 40,000 $ 9,840,000
Machinery and equipment 32,229,000
3,694,000 1,283,000 48,000 34,688,000
$41,249,000
$4,474,000 $1,283,000 $ 88,000 $44,528,000
Year ended June 30, 1992
Buildings and improvements $ 8,035,000 $
795,000 $ - $ 190,000 $ 9,020,000
Machinery and equipment 29,046,000
3,861,000 886,000 208,000 32,229,000
$37,081,000
$4,656,000 $ 886,000 $ 398,000 $41,249,000
____________________________
(1) The annual provisions for depreciation have been
computed using estimated useful lives as follows:
Buildings and improvements ...................
20-40 years
Machinery and equipment ......................
3-16 years
INTERNATIONAL ALUMINUM CORPORATION AND SUBSIDIARIES
SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS
For The Three Years Ended June 30, 1994
Balance at Amounts
Amounts Balance at
Beginning Charged
Written End
Description of Year to Income
Off of Year
Reserves for doubtful accounts -
1994 $673,000 $647,000
$505,000 $815,000
1993 669,000 766,000
762,000 673,000
1992 723,000 619,000
673,000 669,000
F-4
INTERNATIONAL ALUMINUM CORPORATION AND SUBSIDIARIES
SCHEDULE X - SUPPLEMENTARY INCOME STATEMENT INFORMATION
For The Three Years Ended June 30, 1994
Description 1994
1993 1992
Maintenance and repairs $4,992,000
$4,333,000 $4,578,000
Depreciation of property,
plant and equipment 4,563,000
4,474,000 4,656,000
Taxes other than income -
Payroll 5,474,000
5,323,000 5,435,000
Property and other 1,571,000
1,554,000 1,548,000
_________________________
Note: Amounts for rents, royalties and advertising costs are not
presented as such
amounts are less than 1% of total sales and revenues.
F-5
INTERNATIONAL ALUMINUM CORPORATION
SUBSIDIARIES
The following is a list of the significant subsidiaries of the
Registrant
and the jurisdiction under which each is organized. The Company
owns 100
percent of the voting securities of each such subsidiary.
[CAPTION]
Jurisdiction of
Name of Subsidiary
Organization
International Window Corporation
California
International Extrusion Corporation
California
United States Aluminum Corporation
California
General Window Corporation*
California
International California Glass Corporation
California
United States Aluminum Corporation-Illinois
California
International Window-Arizona, Inc.
California
United States Aluminum Corporation-Texas
Texas
International Extrusion Corporation-Texas
California
United States Aluminum Corporation-Carolina
California
International Carolina Glass Corporation
California
Ragland Manufacturing Company, Inc.
Texas
United States Aluminum Corporation-Northeast
California
Maestro Products, Inc.
California
Eland-Brandt, B.V.
The Netherlands
______________________________________________
* dba International Window-Northern California
Exhibit 22