UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
ý QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended July 31, 2004
OR
o TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from to .
Commission File Number 1-5725
QUANEX CORPORATION
(Exact name of registrant as specified in its charter)
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DELAWARE |
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38-1872178 |
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(State or other
jurisdiction of |
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(I.R.S. Employer |
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1900 West Loop South, Suite 1500, Houston, Texas 77027 |
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(Address of principal executive offices and zip code) |
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Registrant’s telephone number, including area code: (713) 961-4600 |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes ý No o
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
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Class |
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Outstanding at July 31, 2004 |
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Common Stock, par value $0.50 per share |
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16,519,457 |
QUANEX CORPORATION
INDEX
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Consolidated Balance Sheets–July 31, 2004 and October 31, 2003 |
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Consolidated Statements of Income–Three Months and Nine Months Ended July 31, 2004 and 2003 |
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Consolidated Statements of Cash Flow–Nine Months Ended July 31, 2004 and 2003 |
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Notes to Consolidated Financial Statements |
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Management’s Discussion and Analysis of Results of Operations and Financial Condition |
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Item 4: |
Submission of Matters to a Vote of Security Holders |
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QUANEX CORPORATION
(Unaudited)
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July 31, |
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October 31, |
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(In thousands) |
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ASSETS |
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Current assets: |
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Cash and equivalents |
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$ |
39,071 |
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$ |
22,108 |
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Accounts and notes receivable, net of allowance of $6,601 and $6,829 |
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185,670 |
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116,596 |
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Inventories |
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127,195 |
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77,261 |
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Deferred income taxes |
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8,203 |
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5,647 |
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Other current assets |
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3,092 |
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1,545 |
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Current assets of discontinued operations |
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12,503 |
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10,291 |
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Total current assets |
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375,734 |
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233,448 |
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Property, plant and equipment |
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850,259 |
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757,491 |
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Less accumulated depreciation and amortization |
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(484,183 |
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(447,041 |
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Property, plant and equipment, net |
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366,076 |
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310,450 |
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Goodwill, net |
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138,924 |
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66,436 |
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Cash surrender value insurance policies, net |
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24,972 |
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24,536 |
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Intangible assets, net |
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28,137 |
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2,755 |
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Other assets |
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9,601 |
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3,521 |
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Assets of discontinued operations |
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27,431 |
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42,321 |
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$ |
970,875 |
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$ |
683,467 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities: |
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Accounts payable |
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$ |
143,876 |
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$ |
86,285 |
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Accrued liabilities |
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43,438 |
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35,926 |
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Income taxes payable |
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8,603 |
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8,098 |
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Other current liabilities |
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12 |
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46 |
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Current maturities of long-term debt |
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3,554 |
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3,877 |
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Current liabilities of discontinued operations |
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4,817 |
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6,433 |
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Total current liabilities |
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204,300 |
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140,665 |
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Long-term debt |
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190,558 |
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15,893 |
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Deferred pension credits |
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6,444 |
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7,781 |
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Deferred postretirement welfare benefits |
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7,864 |
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7,845 |
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Deferred income taxes |
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68,193 |
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51,782 |
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Non-current environmental reserves |
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8,047 |
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13,517 |
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Other liabilities |
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2,771 |
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283 |
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Liabilities of discontinued operations |
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252 |
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542 |
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Total liabilities |
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488,429 |
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238,308 |
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Stockholders’ equity: |
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Preferred stock, no par value, shares authorized 1,000,000; issued and outstanding none |
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— |
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— |
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Common stock, $0.50 par value, shares authorized 50,000,000; issued 16,576,207 and 16,519,271 |
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8,288 |
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8,260 |
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Additional paid-in-capital |
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190,837 |
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187,114 |
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Retained earnings |
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289,351 |
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264,067 |
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Unearned compensation |
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(732 |
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(164 |
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Accumulated other comprehensive income |
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(3,600 |
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(3,641 |
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484,144 |
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455,636 |
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Less common stock held by rabbi trust, 56,750 and 47,507 shares |
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(1,698 |
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(1,317 |
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Less cost of shares of common stock in treasury, zero and 294,803 shares |
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— |
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(9,160 |
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Total stockholders’ equity |
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482,446 |
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445,159 |
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$ |
970,875 |
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$ |
683,467 |
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1
QUANEX CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
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Three
Months Ended |
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Nine
Months Ended |
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2004 |
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2003 |
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2004 |
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2003 |
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(In thousands, except per share amounts) |
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Net sales |
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$ |
424,091 |
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$ |
247,386 |
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$ |
1,089,535 |
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$ |
703,012 |
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Cost of sales |
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357,059 |
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204,466 |
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937,272 |
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585,913 |
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Selling, general and administrative expense |
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18,129 |
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11,784 |
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47,337 |
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37,047 |
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Depreciation and amortization |
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13,561 |
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10,815 |
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39,186 |
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33,038 |
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Gain on sale of land |
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— |
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— |
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(454 |
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(405 |
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Operating income |
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35,342 |
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20,321 |
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66,194 |
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47,419 |
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Interest expense |
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