SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ----------------------- F0RM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended SEPTEMBER 30, 1997 or [ ] 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: 033-64788 ASSOCIATED MATERIALS INCORPORATED (Exact Name of Registrant as Specified in Its Charter) DELAWARE 75-1872487 (State or Other Jurisdiction of (I.R.S. Employer Incorporation of Organization) Identification No.) 2200 ROSS AVENUE, SUITE 4100 EAST, DALLAS, TEXAS 75201 (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number, Including Area Code (214) 220-4600 NOT APPLICABLE Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report Indicate by check X 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 [X] No [ ] Shares of Common Stock, $.0025 par value outstanding at November 12, 1997: 4,934,900 Shares of Class B Common Stock, $.0025 par value outstanding at November 12, 1997: 2,700,000 ASSOCIATED MATERIALS INCORPORATED FORM 10-Q FOR THE QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 1997 PAGE NO. PART I. FINANCIAL INFORMATION Item 1. Financial Statements Balance Sheets................................................. 1 September 30, 1997 (Unaudited) and December 31, 1996 Statements of Operations (Unaudited)........................... 2 Quarter and nine months ended September 30, 1997 and 1996 Statements of Cash Flows (Unaudited)........................... 3 Nine months ended September 30, 1997 and 1996 Notes to Financial Statements (Unaudited)...................... 4 Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition................................. 6 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K............................ 11 SIGNATURES ......................................................... 12 Part I. Financial Information Item 1. Financial Statements ASSOCIATED MATERIALS INCORPORATED BALANCE SHEETS (In Thousands, Except Share Data) SEPTEMBER 30, DECEMBER 31, 1997 1996 --------- -------- (Unaudited) ASSETS Current assets: Cash ........................................... $ 2,595 $ 2,384 Accounts receivable, net ....................... 54,833 47,208 Inventories .................................... 63,092 58,357 Income taxes receivable ........................ -- 587 Other current assets ........................... 3,129 3,025 --------- -------- Total current assets ............................... 123,649 111,561 Property, plant and equipment, net ................. 53,544 51,649 Investment in Amercord Inc. ........................ 10,694 11,320 Other assets ....................................... 2,554 3,179 --------- -------- Total assets ....................................... $ 190,441 $177,709 ========= ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Bank overdrafts ................................ $ 5,177 $ 4,853 Accounts payable ............................... 25,451 17,114 Accrued liabilities ............................ 25,662 22,965 Revolving line of credit ....................... 4,969 13,058 Income taxes payable ........................... 1,482 -- Current portion of long-term debt .............. 1,750 1,750 --------- -------- Total current liabilities .......................... 64,491 59,740 Deferred income taxes .............................. 2,946 1,884 Other liabilities .................................. 3,201 3,489 Long-term debt ..................................... 79,050 80,350 Commitments and contingencies Stockholders' equity: Preferred stock, $.01 par value: Authorized shares - 100,000 at September 30, 1997 and December 31, 1996; Issued and outstanding shares - 0 at September 30, 1997 and December 31, 1996 -- -- Common stock, $.0025 par value: Authorized shares - 15,000,000; Issued and outstanding shares - 4,934,900 at September 30, 1997 and 4,893,504 at December 31, 1996 ....................... 12 12 Common stock, Class B, $.0025 par value: Authorized, issued and outstanding shares - 2,700,000 at September 30, 1997 and December 31, 1996 ...................... 7 7 Less: Treasury stock, at cost - 41,396 shares at September 30, 1997 and 0 at December 31, 1996 .......................... (542) -- Capital in excess of par ....................... 505 185 Retained earnings .............................. 40,771 32,042 --------- -------- Total stockholders' equity ..................... 40,753 32,246 --------- -------- Total liabilities and stockholders' equity ......... $ 190,441 $177,709 ========= ======== See accompanying notes -1- ASSOCIATED MATERIALS INCORPORATED STATEMENTS OF OPERATIONS (Unaudited) (In Thousands, Except Per Share Data) QUARTER ENDED NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, --------------------- --------------------- 1997 1996 1997 1996 --------- -------- --------- -------- Net sales ......................... $ 111,127 $103,159 $ 297,919 $264,518 Cost of sales ..................... 78,511 71,196 212,306 189,320 --------- -------- --------- -------- 32,616 31,963 85,613 75,198 Selling, general and administrative expense .......................... 21,517 20,497 61,646 57,944 --------- -------- --------- -------- Income from operations ............ 11,099 11,466 23,967 17,254 Interest expense .................. 2,228 2,739 7,501 8,285 --------- -------- --------- -------- 8,871 8,727 16,466 8,969 Equity in earnings (loss) of Amercord Inc. .................... (731) 404 (624) 1,440 --------- -------- --------- -------- Income before income tax expense .. 8,140 9,131 15,842 10,409 Income tax expense ................ 3,596 3,599 6,735 3,777 --------- -------- --------- -------- Net income ........................ $ 4,544 $ 5,532 $ 9,107 $ 6,632 ========= ======== ========= ======== Earnings per common share ......... $ 0.58 $ 0.72 $ 1.17 $ 0.86 ========= ======== ========= ======== Weighted average common and common equivalent shares outstanding ... 7,772 7,716 7,776 7,699 ========= ======== ========= ======== See accompanying notes -2- ASSOCIATED MATERIALS INCORPORATED STATEMENTS OF CASH FLOWS (Unaudited) (In Thousands) NINE MONTHS ENDED SEPTEMBER 30, ---------------------- 1997 1996 ------- ------- OPERATING ACTIVITIES Net income............................................ $ 9,107 $ 6,632 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization.................... 4,741 4,367 Deferred income taxes............................ 1,062 1,885 Equity in (earnings) loss of Amercord Inc........ 624 (1,440) Changes in operating assets and liabilities: Accounts receivable, net...................... (7,625) (4,974) Inventories................................... (4,735) (4,390) Income taxes receivable/payable............... 2,228 1,676 Bank overdrafts............................... 324 (510) Accounts payable and accrued liabilities...... 11,034 7,375 Other assets and liabilities.................. (93) (718) ------- ------- Net cash provided by operating activities............. 16,667 9,903 INVESTING ACTIVITIES Additions to property, plant and equipment, net....... (6,307) (6,865) FINANCING ACTIVITIES Net increase (decrease) in revolving line of credit... (8,089) (1,056) Principal payments of long-term debt.................. (1,300) (1,300) Dividends paid........................................ (379) - Treasury stock acquired............................... (542) - Options exercised..................................... 161 - ------- ------- Net cash used in financing activities................. (10,149) (2,356) ------- ------- Net increase in cash.................................. 211 682 Cash at beginning of period........................... 2,384 2,279 ------- ------- Cash at end of period................................. $ 2,595 $ 2,961 ======= ======= Supplemental information: Cash paid for interest................................ $ 9,940 $10,451 ======= ======= Net cash paid for income taxes........................ $ 3,445 $ 247 ======= ======= See accompanying notes -3- ASSOCIATED MATERIALS INCORPORATED NOTES TO FINANCIAL STATEMENTS FOR THE QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 1997 (Unaudited) NOTE 1 - BASIS OF PRESENTATION The unaudited financial statements of Associated Materials Incorporated (the "Company") for the quarter and nine months ended September 30, 1997 have been prepared in accordance with generally accepted accounting principles for interim financial reporting, the instructions to Form 10-Q, and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 1996 filed with the Securities and Exchange Commission. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the interim financial information have been included. The results of operations for any interim period are not necessarily indicative of the results of operations for a full year. NOTE 2 - INVENTORIES Inventories are valued at the lower of cost (first in, first out) or market. Inventories consist of the following (in thousands): SEPTEMBER 30, DECEMBER 31, 1997 1996 ---------- -------- Raw materials................................... $16,780 $14,903 Work in process................................. 5,410 5,276 Finished goods and purchased stock.............. 40,902 38,178 ------- ------- $63,092 $58,357 ======= ======= NOTE 3 - INVESTMENT IN AMERCORD INC. ("AMERCORD") The Company's investment in Amercord, a 50% owned affiliate, is accounted for using the equity method. Condensed statements of operations for Amercord are presented below (in thousands): QUARTER ENDED NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, ------------------- --------------------- 1997 1996 1997 1996 ------- ------- -------- -------- Net sales........................... $17,377 $21,608 $ 57,559 $ 65,549 Costs and expenses.................. 19,327 19,898 58,376 61,536 ------- ------- -------- -------- Income (loss) from operations....... (1,950) 1,710 (817) 4,013 Interest expense.................... 373 432 1,172 1,347 Income tax expense (benefit)........ (860) 471 (740) 985 ------- ------- -------- -------- Net income (loss) before cumulative effect of a change in accounting principle........................ (1,463) 807 (1,249) 1,681 Cumulative effect of a change in accounting principle (net of tax) - - - 1,196 ------- ------- -------- -------- Net income (loss)................... $(1,463) $ 807 $ (1,249) $ 2,877 ======= ======= ======== ======== Company's share of net income (loss) $(731) $404 $(624) $1,440 ===== ==== ====== ====== -4- NOTE 4 - EARNINGS PER COMMON SHARE Earnings per common share computations are determined using the treasury stock method based on weighted average common and common equivalent shares outstanding during the periods presented. Fully diluted earnings per common share are not significantly different than primary earnings per common share. NOTE 5 - RECLASSIFICATIONS Certain prior period amounts have been reclassified to conform with current period presentation. NOTE 6 - ACCOUNTING CHANGES In February 1997 the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 128, "Earnings Per Share" ("SFAS 128") which specified a new methodology for calculating earnings per share and is effective for fiscal years ending after December 15, 1997. This statement will have no effect on the financial position, results of operations or cash flows of the Company but will require a restatement of prior period earnings per share. The Company believes that the earnings per share calculated under SFAS 128 will not be materially different than the current method used. In addition, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive Income" and Statement of Financial Accounting Standards No. 131, "Disclosures About Segments of an Enterprise and Related Information" which are effective for financial statement periods beginning after December 15, 1997. The Company believes that these statements will have no effect on the Company's financial position, results of operations or cash flows. -5- Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS QUARTER ENDED SEPTEMBER 30, 1997 COMPARED TO QUARTER ENDED SEPTEMBER 30, 1996 The table below sets forth for the periods indicated certain items of the Company's financial statements by segment: QUARTER ENDED SEPTEMBER 30, ----------------------------------------------- 1997 1996 -------------------- --------------------- PERCENTAGE OF PERCENTAGE OF AMOUNT TOTAL NET SALES AMOUNT TOTAL NET SALES ------ --------------- ------ --------------- Total Company: Net sales - Alside ............... $ 98,483 88.6% $ 93,170 90.3% Net sales - AmerCable ............ 12,644 11.4 9,989 9.7 -------- ------- -------- ------- Total net sales ................. 111,127 100.0 103,159 100.0 Gross profit ..................... 32,616 29.3 31,963 31.0 Selling, general and administrative expense (1) ...... 21,517 19.4 20,497 19.9 -------- ------- -------- ------- Income from operations ........... $ 11,099 9.9% $ 11,466 11.1% ======== ======= ======== ======= Alside: Net sales ........................ $ 98,483 100.0% $ 93,170 100.0 Gross profit ..................... 30,203 30.7 30,808 33.1 Selling, general and administrative expense .......... 19,646 20.0 19,185 20.6 -------- ------- -------- ------- Income from operations ........... $ 10,557 10.7% $ 11,623 12.5% ======== ======= ======== ======= AmerCable: Net sales ........................ $ 12,644 100.0% $ 9,989 100.0% Gross profit ..................... 2,413 19.1 1,155 11.5 Selling, general and administrative expense .......... 1,126 8.9 644 6.4 -------- ------- -------- ------- Income from operations ........... $ 1,287 10.2% $ 511 5.1% ======== ======= ======== ======= (1) Consolidated selling, general and administrative expenses include corporate expenses of $745,000 and $668,000 for the quarters ended September 30, 1997 and 1996, respectively. OVERVIEW GENERAL. The Company's net sales increased 7.7% to $111.1 million in the third quarter of 1997 as compared to the 1996 period due to higher sales volume. Income from operations decreased 3.2% or $367,000 to $11.1 million for the quarter ended September 30, 1997 as compared to $11.5 million for the 1996 period due primarily to lower operating income experienced at its Alside division which was only partially offset by increased operating income at its AmerCable division. Net income decreased 17.9% to $4.5 million for the quarter ended September 30, 1997 as compared to the 1996 period due to Alside's lower operating income and a $1.1 million decrease in equity in the earnings of the Company's affiliate, Amercord. ALSIDE. Alside's net sales increased $5.3 million or 5.7% to $98.5 million for the quarter ended September 30, 1997 as compared to the same period in 1996 as unit sales of vinyl siding and vinyl windows increased 6.2% and 11.5%, respectively. Alside's income from operations was $10.6 million for the quarter ended September 30, 1997, a decrease of 9.2% from $11.6 million for same period in 1996 primarily due to higher raw material costs. As a result, gross profit as a percentage of net sales decreased to 30.7% in the 1997 period from 33.1% in the 1996 period. Selling, general and administrative expense increased 2.4% to $19.6 million for the quarter -6- ended September 30, 1997 due to higher advertising expenditures and higher salaries and wages resulting from additional sales personnel and increased incentive compensation. Selling, general and administrative expense decreased slightly as a percentage of net sales. AMERCABLE. AmerCable's net sales increased $2.7 million or 26.6% for the quarter ended September 30, 1997 as compared to the same period in 1996 due to increased sales volume across all major product lines. Gross profit as a percentage of net sales increased to 19.1% for the quarter ended September 30, 1997 from 11.5% for the same period in 1996 due to increased sales prices, improved labor productivity and material efficiencies. Income from operations increased $776,000 to $1.3 million for the quarter ended September 30, 1997 as compared to $511,000 for the same period in 1996 due primarily to increased sales volume, sales prices and lower production costs. Selling, general and administrative expense increased to $1.1 million for the quarter ended September 30, 1997 due primarily to higher incentive compensation. AMERCORD. The Company recorded a loss of $731,000 reflecting its share of the after tax loss of Amercord for the quarter ended September 30, 1997 as compared with income of $404,000 for the same period in 1996. The Company's share of Amercord's third quarter 1996 after tax income was $284,000 exclusive of the Company's share of a royalty settlement gain and a writedown of equipment in accordance with SFAS No. 121. Amercord's net sales decreased 19.6% to $17.4 million in the quarter ended September 30, 1997 as compared to the 1996 period due to lower sales volume and lower average unit selling prices. Gross profit decreased from $1.9 million for the quarter ended September 30, 1996 to $(1.4) million for the same period in 1997 due primarily to lower sales prices and decreased tire cord manufacturing efficiencies. Selling, general and administrative expense decreased from $589,000 for the quarter ended September 30, 1996 to $581,000 for the same period in 1997. The Company presently expects Amercord's average selling prices to remain stable during the remainder of 1997 and further decline during 1998 which may adversely affect Amercord's results of operations in 1998 and beyond. OTHER. Net interest expense decreased $511,000 or 18.7% in the quarter ended September 30, 1997 compared with the same period in 1996 due to lower borrowing requirements experienced on the Company's line of credit during the third quarter of 1997 and the recording of $280,000 in interest income relating to a $1.4 million income tax refund. -7- NINE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 1996. The table below sets forth for the periods indicated certain items of the Company's financial statements by segments. NINE MONTHS ENDED SEPTEMBER 30, -------------------------------------------------------------- 1997 1996 ------------------------ -------------------------- PERCENTAGE OF PERCENTAGE OF AMOUNT TOTAL NET SALES AMOUNT TOTAL NET SALES -------- --------------- --------- --------------- Total Company: Net sales - Alside ................ $257,475 86.4% $ 233,686 88.3% Net sales - AmerCable ............. 40,444 13.6 30,832 11.7 -------- ----- --------- ----- Total net sales .................. 297,919 100.0 264,518 100.0 Gross profit ...................... 85,613 28.7 75,198 28.4 Selling, general and administrative expense (1) ....... 61,646 20.7 57,944 21.9 -------- ----- --------- ----- Income from operations ............ $ 23,967 8.0% $ 17,254 6.5% ======== ===== ========= ===== Alside: Net sales ......................... $257,475 100.0% $ 233,686 100.0% Gross profit ...................... 78,914 30.6 74,083 31.7 Selling, general and administrative expense ........... 56,449 21.9 53,654 23.0 -------- ----- --------- ----- Income from operations ............ $ 22,465 8.7% $ 20,429 8.7% ======== ===== ========= ===== AmerCable: Net sales ......................... $ 40,444 100.0% $ 30,832 100.0% Gross profit ...................... 6,699 16.6 1,115 3.6 Selling, general and administrative expense ........... 3,295 8.2 2,502 8.1 -------- ----- --------- ----- Income (loss) from operations ..... $ 3,404 8.4% $ (1,387) (4.5)% ======== ===== ========= ===== (1) Consolidated selling, general and administrative expenses include corporate expenses of $1,902,000 and $1,788,000 for the nine month periods ended September 30, 1997 and 1996, respectively. OVERVIEW GENERAL. The Company's net sales increased 12.6% to $297.9 million for the nine-month period ended September 30, 1997 due to net sales increases of 10.2% and 31.2% for Alside and AmerCable, respectively. The increased operating income was due to higher sales volume at both Alside and AmerCable as well as substantial production efficiency gains at AmerCable. The Company's net income increased 37.3% to $9.1 million for the nine months ended September 30, 1997 as compared to the 1996 period primarily due to higher operating income at its Alside and AmerCable divisions. ALSIDE. Alside's net sales increased $23.8 million or 10.2% for the nine months ended September 30, 1997 as compared to the same period in 1996 due primarily to increased unit sales of vinyl siding and vinyl windows of 11.6% and 19.3%, respectively. Gross profit as a percentage of net sales decreased to 30.6% for the nine-month period ended September 30, 1997 as compared to the same period in 1996 principally due to increased raw material costs, including vinyl resin. Alside's income from operations increased 10% or $2.0 million to $22.5 million for the nine months ended September 30, 1997 as compared to $20.4 million for the same period in 1996. The increase in income from operations was due to increased sales volume across the majority of Alside's product lines which were partially offset by the higher raw material costs which Alside did not pass through to its customers. Selling, general and administrative expense increased to $56.4 million for the nine months ended September 30, 1997 from $53.7 million for the same period in 1996 but decreased as a percentage of net sales. The increase in selling, general and administrative expense was due primarily to increased advertising expenditures and employee compensation. -8- AMERCABLE. AmerCable's net sales increased $9.6 million or 31.2% for the nine months ended September 30, 1997 as compared to the same period in 1996 due to increased sales volume and prices. Gross profit as a percentage of net sales increased to 16.6% for the nine months ended September 30, 1997 from 3.6% for the same period in 1996 due to improved labor productivity and material efficiencies and higher sales prices. Income from operations was $3.4 million for the nine months ended September 30, 1997 compared to a loss from operations of $1.4 million for the same period in 1996 due primarily to increased sales volume and sales prices, as well as lower production costs. Selling, general and administrative expense increased to $3.3 million due primarily to higher incentive compensation. AMERCORD. The Company recorded a loss of $624,000 reflecting its share of the after tax losses of Amercord for the nine months ended September 30, 1997 as compared with income of $1.4 million for the same period in 1996. The Company's share of after tax income for the nine months ended September 30, 1996 was $639,000 exclusive of the Company's share of the cumulative change in accounting principle, a royalty settlement and an equipment writedown. Amercord's net sales decreased 12.2% to $57.6 million in the nine-month period ended September 30, 1997 as compared to the same period in 1996 due primarily to a decrease in sales volume and lower average unit selling price of its products. Gross profit decreased from $5.7 million for the nine months ended September 30, 1996 to $1.4 million for the same period in 1997 due primarily to lower sales prices and decreased manufacturing efficiencies. Selling, general and administrative expense increased to $2.2 million for the nine months ended September 30, 1997 from $2.0 million for the same period in 1996. The Company presently expects Amercord's average selling prices to remain stable during the remainder of 1997 and further decline during 1998 which may adversely affect Amercord's results of operations in 1998 and beyond. OTHER. Net interest expense decreased $784,000 or 9.5% in the nine months ended September 30, 1997 compared with the same period in 1996 due to lower borrowing requirements experienced on the Company's line of credit during the 1997 period compared to the 1996 period. The Company recorded interest income of $280,000 related to a $1.4 million income tax refund. LIQUIDITY AND CAPITAL RESOURCES Borrowings under the Company's existing credit facility were $4.9 million at September 30, 1997, excluding outstanding letters of credit totaling $8.5 million securing $5.9 million of taxable notes and certain other obligations. At September 30, 1997 the Company had an available borrowing capacity of approximately $36.6 million. Net cash provided by operations was $16.7 million in the nine months ended September 30, 1997 compared with $9.9 in the same period in 1996. The increase in cash provided by operations in the 1997 period was due principally to higher net income and higher payables for the period ended September 30, 1997 as compared to the 1996 period. Capital expenditures totaled $6.3 million for the nine months ended September 30, 1997, compared with $6.9 million during the same period in 1996. Expenditures in the 1997 period were primarily used to increase extrusion capacity for vinyl siding, windows and vinyl fence as well as to increase and automate window fabrication capacity. The Company believes the future cash flows from operations and its borrowing capacity under its existing credit agreement will be sufficient to satisfy its obligations to pay principal and interest on its outstanding debt, maintain current operations and provide sufficient capital for presently anticipated capital expenditures. However, there can be no assurances that the cash so generated by the Company will be sufficient for such purposes. The Company currently has $75 million of 11 1/2% senior subordinated notes outstanding. These notes are callable at the option of the Company beginning in August 1998 at 104.313% of the outstanding principal amount thereof, decreasing to 100% of the principal amount in August 2001. The Company may seek to refinance all or part of the notes in order to obtain more favorable interest rates. No assurances can be given that the Company will be able to obtain such financing or the terms on which such financing may be available. -9- EFFECTS OF INFLATION Inflation could adversely affect the Company if inflation results in significantly higher interest rates or substantial weakness in economic conditions. Alside's principal raw material, vinyl resin, has been subject to rapid price increments. Alside has historically been able to pass on price increases to its customers. No assurances can be given that Alside will continue to be able to pass on any price increases. CERTAIN FORWARD-LOOKING STATEMENTS This report contains certain forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) relating to the Company that are based on the beliefs of the management. When used in this report, the words "anticipate," "believe," "estimate," "expect," "intend," and similar expressions, as they relate to the Company or the Company's management, identify forward-looking statements. Such statements reflect the current views of the Company with respect to future events and are subject to certain risks, uncertainties and assumptions relating to the operations and results of operations of the Company as well as its customers and suppliers, including as a result of the availability of consumer credit, interest rates, employment trends, changes in levels of consumer confidence, changes in consumer preferences, national and regional trends in new housing starts, raw material costs, pricing pressures, shifts in market demand, and general economic conditions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions or estimates prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended. -10- Part II Other Information Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits 27 Financial Data Schedule. (b) Reports on Form 8-K During the quarter ended September 30, 1997, Associated Materials Incorporated filed no Current Reports on Form 8-K. -11- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ASSOCIATED MATERIALS INCORPORATED (Registrant) Date: November 12, 1997 By: \s\ ROBERT L. WINSPEAR Robert L. Winspear, Vice President, Treasurer and Secretary (Principal Financial and Accounting Officer) -12- INDEX TO EXHIBITS EXHIBIT NUMBER DESCRIPTION - ------ ----------- 27 Financial Data Schedule -13-