EXHIBIT 25(b)
TO FORM 10-K
ANNUAL REPORT
OF
VULCAN MATERIALS COMPANY
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1993
UNDER THE SECURITIES EXCHANGE ACT OF 1934
FINANCIAL STATEMENTS REQUIRED BY FORM 11-K WITH
RESPECT TO THE VULCAN MATERIALS COMPANY CONSTRUCTION
MATERIALS DIVISIONS HOURLY EMPLOYEES SAVINGS PLAN FOR
THE FISCAL YEAR ENDED DECEMBER 31, 1993, AND THE INDEPENDENT
CERTIFIED ACCOUNTANTS' CONSENT WITH RESPECT THERETO
FILED AS AN AMENDMENT TO THE VULCAN MATERIALS
COMPANY ANNUAL REPORT ON FORM 10-K FOR THE
FISCAL YEAR ENDED DECEMBER 31, 1993,
AS PERMITTED BY RULE 15d-21
UNDER THE SECURITIES EXCHANGE ACT OF 1934
VULCAN MATERIALS COMPANY
VULCAN MATERIALS COMPANY
CONSTRUCTION MATERIALS DIVISIONS
HOURLY EMPLOYEES SAVINGS PLAN
FINANCIAL STATEMENTS FOR THE YEARS
ENDED DECEMBER 31, 1993 AND 1992, AND
INDEPENDENT AUDITORS' REPORT.
VULCAN MATERIALS COMPANY
CONSTRUCTION MATERIALS DIVISIONS
HOURLY EMPLOYEES SAVINGS PLAN
Table of Contents
Page
Independent Auditors' Report
Financial Statements of the Vulcan Materials Company
Construction Materials Divisions Hourly Employees
Savings Plan:
Statements of Net Assets Available for Benefits
as of December 31, 1993 and 1992
Statements of Changes in Net Assets Available
for Benefits for the Years Ended
December 31, 1993 and 1992
Notes to Financial Statements
Independent Auditors' Consent
INDEPENDENT AUDITORS' REPORT
To the Administrative Committee of Vulcan Materials Company
Construction Materials Divisions Hourly Employees Savings Plan:
We have audited the accompanying statements of net assets available for
benefits of the Vulcan Materials Company Construction Materials Divisions
Hourly Employees Savings Plan 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, such financial statements 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 net assets available for benefits for the
years then ended in conformity with generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental information by fund
is presented for the purpose of additional analysis of the basic financial
statements rather than to present information regarding the net assets
available for benefits and changes in net assets available for benefits of the
individual funds, and is not a required part of the basic financial
statements. This supplemental information is the responsibility of the Plan's
management. Such supplemental information by fund has been subjected to the
auditing procedures applied in our audits of the basic financial statements
and, in our opinion, is fairly stated in all material respects when considered
in relation to the basic financial statements taken as a whole.
/s/ Deloitte & Touche
Birmingham, Alabama
June 15, 1994
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement
No. 33-24051 of Vulcan Materials Company on Form S-8 of our reports dated
February 4, 1994 and June 15, 1994, appearing in the Annual Report on Form
10-K of Vulcan Materials Company for the year ended December 31, 1993 and
in the Annual Report on Form 11-K of the Vulcan Materials Company
Construction Materials Divisions Hourly Employees Savings Plan for the year
ended December 31, 1993, respectively. We also consent to the reference to
us under the heading "Experts" in the Registration Statement.
/s/ Deloitte & Touche
Birmingham, Alabama
June 24, 1994
VULCAN MATERIALS COMPANY
CONSTRUCTION MATERIALS DIVISIONS HOURLY EMPLOYEES SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1993 AND 1992
1993 1992
Supplemental Information by Fund Supplemental Information by Fund
Vulcan Vulcan
Large Materials Large Materials
Guaranteed Companies Company Guaranteed Companies Company
Investment Common Common Investment Common Common
Total Contracts Stock Stock Total Contracts Stock Stock
ASSETS:
INVESTMENTS [Cost of $7,820,483
(1993) and $6,547,388 (1992)]
(Notes 1, 3 & 5):
Collective short-term investment $24,691 $22,725 $948 $1,018 $15,722 $15,661 $4 $57
Guaranteed investment
contracts 6,683,740 6,683,740 5,755,856 5,755,856
Commingled funds holding
principally common stock 224,756 224,756 149,481 149,481
Fund holding principally
Vulcan Materials Company
common stock 1,057,500 1,057,500 786,523 786,523
Total investments 7,990,687 6,706,465 225,704 1,058,518 6,707,582 5,771,517 149,485 786,580
RECEIVABLE FROM VULCAN
MATERIALS COMPANY:
Employer contributions 35,655 35,655 34,479 34,479
Employee contributions 134,072 92,472 5,788 35,812 127,400 93,409 5,117 28,874
Total receivable 169,727 128,127 5,788 35,812 161,879 127,888 5,117 28,874
TOTAL ASSETS 8,160,414 6,834,592 231,492 1,094,330 6,869,461 5,899,405 154,602 815,454
TRANSFERS IN PROCESS (601) 601 (14,428) 1,998 12,430
NET ASSETS AVAILABLE
FOR BENEFITS $8,160,414 $6,834,592 $230,891 $1,094,931 $6,869,461 $5,884,977 $156,600 $827,884
<FN>
See notes to financial statements.
VULCAN MATERIALS COMPANY
CONSTRUCTION MATERIALS DIVISIONS HOURLY EMPLOYEES SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1993 AND 1992
1993 1992
Supplemental Information by Fund Supplemental Information by Fund
Vulcan Vulcan
Large Materials Large Materials
Guaranteed Companies Company Guaranteed Companies Company
Investment Common Common Investment Common Common
Total Contracts Stock Stock Total Contracts Stock Stock
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
INVESTMENT INCOME (LOSS):
Interest $404,902 $404,032 $93 $777 $431,796 $430,984 $173 $639
Dividends 24,359 24,359 16,517 16,517
Net investment gains (losses):
Realized 664 664 1,087 1,087
Unrealized (Note 4) 10,010 31,239 (21,229) 190,947 20,774 170,173
Net investment income 439,935 404,032 31,996 3,907 640,347 430,984 22,034 187,329
CONTRIBUTIONS (Note 2):
Participants 1,394,709 980,516 57,824 356,369 1,326,654 989,942 53,829 282,883
Vulcan Materials Company 370,925 370,925 374,267 374,267
Total contributions 1,765,634 1,351,441 57,824 356,369 1,700,921 1,364,209 53,829 282,883
REDISTRIBUTION OF PARTICIPANTS'
INVESTMENT OPTION UNDER THE PLAN (62,926) 5,737 57,189 (46,773) 10,706 36,067
TRANSFERS FROM OTHER PLANS (Note 6) 9,264 7,388 938 938 32,169 20,000 12,169
TOTAL ADDITIONS 2,214,833 1,699,935 96,495 418,403 2,373,437 1,768,420 98,738 506,279
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
WITHDRAWALS BY PARTICIPANTS (Note 2) (923,880) (750,320) (22,204) (151,356) (1,137,049) (983,599) (35,340) (118,110)
NET INCREASE 1,290,953 949,615 74,291 267,047 1,236,388 784,821 63,398 388,169
NET ASSETS AVAILABLE FOR BENEFITS:
BEGINNING OF YEAR 6,869,461 5,884,977 156,600 827,884 5,633,073 5,100,156 93,202 439,715
END OF YEAR $8,160,414 $6,834,592 $230,891 $1,094,931 $6,869,461 $5,884,977 $156,600 $827,884
<FN>
See notes to financial statements.
VULCAN MATERIALS COMPANY
CONSTRUCTION MATERIALS DIVISIONS
HOURLY EMPLOYEES SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General - The financial statements of the Vulcan Materials Company
Construction Materials Divisions Hourly Employees Savings Plan ("Plan") have
been prepared on the accrual basis of accounting. All assets of the
Plan are held by The Northern Trust Company, Chicago, Illinois ("Trustee").
Vulcan Materials Company ("Company") pays the administrative costs of the
Plan, including the trustee's fees and charges.
Valuation of Investments - Investments other than guaranteed investment
contracts are reported at market value. Investments in securities traded on
national and over-the-counter exchanges are valued at the closing bid price of
the security as of the last day of the year. Guaranteed investment contracts
are reported at their contract value, which is cost increased by interest
earned. The average cost of securities sold or distributed is used to
determine net investment gains (losses) realized. Security transactions are
recorded on the trade date. Distributions of common stock, if any, to
participants are recorded at the market value of such stock at the end of the
month prior to distribution.
Benefits Payable - In 1993, the Plan changed its method of accounting for
benefits payable to comply with the 1993 AICPA Audit and Accounting Guide,
"Audits of Employee Benefit Plans." The new guidance requires that benefits
payable to persons who have withdrawn from participation in a defined
contribution plan be disclosed in the footnotes to the financial statements
rather than be recorded as a liability of the Plan. Such amounts as of
December 31, 1992 have been reclassified to net assets available for benefits.
As of December 31, 1993 and 1992, benefits of $144,667 and $66,164,
respectively, were due to participants who had elected to receive a
distribution from the Plan.
2. DESCRIPTION OF THE PLAN
General - The Plan, established October 1, 1983 and restated as of May 1,
1991, is a defined contribution employee benefit plan covering all hourly
employees of the Company's Southeast, Mideast, Midsouth and Southwest
Divisions, as well as all non-union hourly employees of the Company's Southern
and Midwest Divisions and its wholly-owned subsidiaries, Vulcan Gulf Coast
Materials, Wanatah Trucking Co., Inc., Reed Crushed Stone, Reed Terminal
Company, Inc. and BRT Transfer Terminal, Inc., (the "Participating
Companies").
Participation and Vesting - Generally, hourly employees qualify to participate
upon completion of one year of employment service. Participants are fully
vested at all times.
The number of participants in the Plan at December 31, 1993 and 1992 was
as follows:
1993 1992
Total participants 1,831 1,869
Participants included in the above total who have
transferred to a bargaining unit not covered by
the Plan, or are no longer employed by the Company,
but who have vested benefits under the Plan 60 162
Funding - The Plan is funded through participants' and Company contributions.
A participant may make weekly matched contributions, in multiples of $1,
subject to a $5 minimum and $15 maximum. For participants with less than ten
years of employment service, Company contributions equal 25% of participants'
matched contributions. For participants with ten or more years of service,
Company contributions equal 50% of participants' matched contributions. In
addition to the matched contributions, participants may make weekly unmatched
contributions in multiples of $1 subject to a $1 minimum and $10 maximum.
Allocation and Determination of Accounts - Separate accounts are maintained
for each participant for matched, unmatched, Company contributions and
accumulated earnings on each. Additionally, subaccounts are maintained for
matched and unmatched accounts for the portion of each account that is
attributable to pre-tax contributions and the portion attributable to
after-tax contributions. Monthly net earnings are allocated to each
participant's account in the ratio of the participant's account balance to
total participants' account balances.
Distributions and Withdrawals - A participant's total account is distributed
upon retirement, disability, death or termination of employment unless the
account value is greater than $3,500, in which case the participant may defer
until age 70-1/2. Prior to a termination of employment, participants may make
partial withdrawals or may withdraw their total account, except that if a
participant has not maintained a participant contribution account for the 60
months immediately preceding the voluntary withdrawal, no Company
contributions which have been on deposit less than 24 months will be
distributed until 24 months after the earlier of the employee's withdrawal
date or the employee's termination of employment. In addition, any in-
service distribution from a participant's pre-tax contributions must meet the
requirements of a "hardship withdrawal," as set forth in the Plan document.
Investments - Participants' contributions are invested in three separate
investment funds (see Note 5) of the Plan in proportions elected by the
participant. The Company's matching contributions are invested in the fund
which invests primarily in guaranteed investment contracts.
Plan Termination - In the event it becomes necessary to terminate the Plan,
participants will receive a distribution of the amounts held for their
accounts.
3. INVESTMENTS
The Plan's investment assets consist of an interest in one of the investment
accounts of the Vulcan Materials Company Master Trust ("Master Trust")
administered by Northern Trust Company. Use of the Master Trust permits the
commingling of investment assets of a number of employee benefit plans of the
Participating Companies. Although the assets are commingled, the Company
maintains supporting records for the purpose of allocating the investment
assets and the related net earnings to the various participating employee
benefit plans.
The investment accounts of the Master Trust at December 31, 1993 and 1992 are
summarized as follows:
1993 1992
Pension Investment Account $270,465,591 $248,841,858
Thrift Plan Investment Account 153,862,152 152,945,331
Chemicals Savings Account 16,135,387 14,600,590
Construction Savings Account 8,160,414 6,869,461
Net assets $448,623,544 $423,257,240
The net assets of the Master Trust at December 31, 1993 and 1992 are
summarized as follows:
1993 1992
Commingled fund holding principally
short-term fixed income investments,
and loans to participants $18,678,781 $18,906,750
Guaranteed investment contracts 19,803,668 17,783,818
Fund holding principally real estate
investments 12,044,398 15,171,552
Fund holding principally intermediate-
term fixed income investments 57,877,310 41,202,434
Commingled funds holding principally
common stock 157,489,866 172,504,398
Commingled funds holding principally
international equity instruments 73,558,068 47,716,502
Fund holding principally Vulcan Materials
Company common stock 109,171,453 109,971,786
Net assets $448,623,544 $423,257,240
The total investment income by type of the Master Trust at December 31, 1993
and 1992 are summarized as follows:
1993 1992
Interest, net $1,897,072 $2,112,527
Dividends 2,898,022 2,732,726
Other 69,745 60,668
Net investment gains:
Realized 24,636,203 9,181,194
Unrealized 5,391,112 35,673,442
$34,892,154 $49,760,557
Investments held by the Plan at December 31, 1993 and 1992 respectively, are
as follows:
1993 1992
Collective short-term investments
(cost and market) $24,691 $15,722
Guaranteed investment contracts (at contract value):
Insurance Contract Guaranteed Contract Value
Company Year Rate* Maturity Dates 1993 1992
Metropolitan Life 1990 9.33% May 1, 1993 $1,882,865
Metropolitan Life 1991 6.09%** May 1, annually $6,683,740 3,872,991
Total $6,683,740 $5,755,856
<FN>
* Rates are net of insurance company charges.
** Interest rate was 8.22% from January 1 - April 30, 1992, 7.43% from
May 1, 1992 - April 30, 1993, and 6.09% from May 1 - December 31, 1993.
Upon maturity, the Company renegotiates new terms on these contracts.
Commingled funds:
1993 1992
Cost Market Cost Market
Commingled funds holding principally
common stock - 791.30 shares
(1993) and 622.24 shares (1992) $165,588 $224,756 $121,552 $149,481
Fund holding principally Vulcan
Materials Company common
stock - 22,560 shares (1993)
and 16,301 shares (1992) $946,464 $1,057,500 $654,258 $786,523
4. CHANGES IN UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS
Investments held by the Plan at December 31, 1993 and 1992 and changes in
unrealized appreciation (depreciation) of investments for the years then ended
are summarized below:
Current
Market or Year Prior Years
Contract Cumulative Appreciation Appreciation
Cost Value Appreciation (Depreciation) (Depreciation)
December 31, 1993:
Collective short-term
investments $24,691 $24,691
Guaranteed investment
contracts 6,683,740 6,683,740
Commingled funds
holding principally
Common stock 165,588 224,756 $59,168 $31,239 $27,929
Fund holding principally
Vulcan Materials
Company common
stock 946,464 1,057,500 111,036 (21,229) 132,265
Total $7,820,483 $7,990,687 $170,204 $10,010 $160,194
December 31, 1992:
Collective short-term
investments $15,722 $15,722
Guaranteed investment
contracts 5,755,856 5,755,856
Commingled funds
holding principally
common stock 121,552 149,481 $27,929 $20,774 $7,155
Fund holding principally
Vulcan Materials
Company common
stock 654,258 786,523 132,265 170,173 (37,908)
Total $6,547,388 $6,707,582 $160,194 $190,947 ($30,753)
5. INVESTMENT PROGRAM
The number of participants electing each investment option is shown below:
As of December 31,
1993 1992
(a) A fund invested in guaranteed
investment contracts 889 947
(b) Commingled funds invested
primarily in common stocks
of large companies 15 15
(c) Common stock of Vulcan
Materials Company 191 176
(d) Any combination of (a),
(b) or (c) 736 731
Investment managers have been appointed whose duty is to advise the trustee as
to particular investments to be made. As of December 31, 1993, the investment
managers were as follows:
(1) Large companies Trinity Investment Management Corporation
common stock fund Ten Tremont Street
Boston, Massachusetts 02108
(2) Guaranteed investment The Northern Trust Company
contracts and Vulcan 50 South LaSalle Street
Materails Company Chicago, Illinois 60675
stock fund
6. PLAN TRANSFERS
During 1992 and 1993, the Plan accepted rollover contributions from employees
of acquired companies. During 1992, the Plan accepted rollover contributions
of $32,169 from employees of Florida Mining and Materials (FMM). During 1993,
the Plan accepted rollover contributions of $9,264 from employees of Thrift
Brothers, Inc.
7. TAX STATUS
The Plan obtained its latest determination letter on June 14, 1993, which the
Internal Revenue Service stated that the Plan, as then designed, was in
compliance with the applicable requirements of the Internal Revenue Code. The
Plan has been amended since receiving the determination letter. However, the
Plan administrator and the Plan's tax counsel believe that the Plan is
currently designed and being operated in compliance with the applicable
requirements of the Internal Revenue Code. Therefore, no provision for income
taxes has been included in the Plan's financial statements.