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FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: October 15, 2002
Commission File Number 1-13123
METALS USA, INC.
(Exact name of Registrant as Specified in its Charter)
DELAWARE 76-0533626
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
THREE RIVERWAY, SUITE 600 77056
HOUSTON, TEXAS (Zip Code)
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (713) 965-0990
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METALS USA, INC.
FORM 8-K
ITEM 9.
Pursuant to the Company's Reorganization Plan and previously announced
planned divestitures, the Company has completed the sale of certain assets,
the proceeds of which, in the aggregate, exceed 10% of the Company's total
consolidated assets. The assets held for sale at December 31, 2001, did not
meet the requirements for discontinued operations presentation. Cash has
been the only consideration received for the asset sales. As disclosed in
the Form 10-Q for the six months ended June 30, 2002, several asset sales
were completed with aggregate cash proceeds of $18.0 million. Subsequent to
June 30, 2002 and through September 30, 2002 six additional asset sale
transactions were completed for total cash proceeds of $63.2 million. In
addition, $18.2 million of accounts receivable related to these operations
was retained and will be collected by the Company. Three of the six asset
sales transactions which occurred in the third quarter, account for the
majority of the proceeds as follows.
The inventory and fixed assets of the Company's Specialty Metals
Northwest operations, with five facilities located throughout the
northwestern United States were sold on September 10, 2002, to
Reliance Steel & Aluminum Co. for aggregate cash consideration of
$30.0 million. Accounts receivable related to these operations to
be collected by the Company total $6.9 million.
The inventory and fixed assets of the Company's Plates and Shapes
Northcentral operations located in Milwaukee, Wisconsin were sold on
September 10, 2002, to I. Bahcall Steel & Pipe, Inc. for aggregate
cash consideration of $10.9 million. Twenty-five percent of the
accounts receivable ($0.9 million) related to this operation will
be collected by the Company.
The inventory and fixed assets of the Company's Plates and Shapes
Southwest operations located in Houston and San Antonio, Texas and
Shreveport, Louisiana were sold on September 30, 2002, to Triple-S
Steel Supply Co. for aggregate cash consideration of $16.8 million.
Accounts receivable related to these operations to be collected by
the Company total $6.2 million.
The net proceeds from all of the asset sales have been used to reduce the
balance outstanding under the Company's secured bank loans, which as of
October 2, 2002, were $136.9 million.
Attached hereto are Pro Forma Consolidated Statements of Operations for the
Six Months Ended June 30, 2002 and the Year Ended December 31, 2001, which
have been adjusted to eliminate the results of operations of the facilities
which have been sold, as of January 1, 2001, and to reflect a reduction in
interest expense as the net proceeds from the asset sales were used to reduce
outstanding indebtedness. The reduction in interest expense for each period
was based upon the actual and estimated net proceeds for the applicable
assets and the Company's weighted average borrowing rate on its revolving
credit facilities during the relevant periods presented.
Accordingly, the following schedules present the pro forma results of
operations for the periods presented.
METALS USA, INC.
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
Six Months Ended June 30, 2002
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Results of
Operations of
As Reported Facilities Sold Pro Forma
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Net sales $ 484.3 $ (21.5) $ 462.8
Cost of sales 365.7 (16.9) 348.8
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Gross profit 118.6 (4.6) 114.0
Operating and delivery 61.9 (3.2) 58.7
Selling, general and administrative 48.0 (3.7) 44.3
Depreciation and amortization 4.2 (0.0) 4.2
Asset impairment 3.5 - 3.5
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Operating income 1.0 2.3 3.3
Interest and securitization expense 10.4 (3.7) 6.7
Reorganization expenses 9.1 - 9.1
Other expense (0.4) - (0.4)
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Loss before income taxes and discontinued
operations (18.1) 6.0 (12.1)
Benefit for income taxes (3.7) 1.2 (2.5)
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Loss before discontinued operations (14.4) 4.8 (9.6)
Discontinued operations, net of income
tax benefit 0.2 (1.3) (1.1)
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Net loss $ (14.2) $ 3.5 $ (10.7)
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Loss per share for basic and diluted:
Before discontinued operations $ (0.39) $ 0.13 $ (0.26)
Discontinued operations - (0.03) (0.03)
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Total $ (0.39) $ 0.10 $ (0.29)
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METALS USA, INC.
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
Year Ended December 31, 2001
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Results of
Operations of
As Reported Facilities Sold Pro Forma
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Net sales $ 1,562.0 $ (352.9) $ 1,209.1
Cost of sales 1,205.7 (279.5) 926.2
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Gross profit 356.3 (73.4) 282.9
Operating and delivery 195.2 (38.6) 156.6
Selling, general and administrative 142.5 (32.3) 110.2
Depreciation and amortization 26.2 (5.2) 21.0
Integration credit (2.1) - (2.1)
Asset impairments 386.2 - 386.2
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Operating income (loss) (391.7) 2.7 (389.0)
Interest and securitization expense 46.7 (7.8) 38.9
Reorganization expenses 19.4 - 19.4
Other expense 1.8 - 1.8
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Loss Before Taxes and Extraordinary Item (459.6) 10.5 (449.1)
Provision (benefit) for income Taxes (52.3) 1.2 (51.1)
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Loss before extraordinary item (407.3) 9.3 (398.0)
Extraordinary Charge from early extinquishment
of debt, net of income taxes 1.8 - 1.8
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Net loss $ (409.1) $ 9.3 $ (399.8)
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Loss per share for basic and diluted:
Before extraordinary item $ (11.16) $ 0.26 $ (10.90)
Extraordinary item (0.05) - (0.05)
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Total $ (11.21) $ 0.26 $ (10.95)
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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, who has signed this report on behalf
of the Registrant.
METALS USA, INC.
Date: October 15, 2002 By: /s/ Terry L. Freeman
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Terry L. Freeman
Senior Vice President, Treasurer
and Chief Accounting Officer