================================================================= ============= 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. ================================================================= === 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 <FN> ______________________ (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 <FN> ____________________________ (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 <FN> _________________________ 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