<PAGE>
                       SECURITIES AND EXCHANGE COMMISSION
 
                             Washington, D.C. 20549
 
                                   FORM 10-K
 
    [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                            ACT OF 1934 (the "Act")
                     For the fiscal year ended December 31, 1996
 
                                       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 0-23070
 
                              AFC CABLE SYSTEMS, INC.
               (Exact name of registrant as specified in its charter)

             Delaware                                      95-1517994
 (State or other jurisdiction of                       (I.R.S. Employer
 incorporation or organization)                        Identification No.)

50 Kennedy Plaza, Suite 1250, Providence, Rhode Island          02903
 (Address of principal executive offices)                    (Zip Code)
 
Registrant's telephone number, including area code: (401) 453-2000
 
Securities registered pursuant to Section 12(b) of the Act: None
 
Securities registered pursuant to Section 12(g) of the Act:
 
                      Title of Class: Common Stock ($.01 Par Value)
 
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[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 the 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. [ ]
 
The aggregate market value of the registrant's voting stock held by
non-affiliates was approximately $103,329,493 on March 24, 1997, based on the
closing sales price of the registrant's common stock, $.01 par value (the
"Common Stock"), as reported on the NASDAQ National Market System as of such
date.
 
The number of shares of the registrant's Common Stock outstanding as of
March 24, 1997 was 7,458,025 shares.
 
                      DOCUMENTS INCORPORATED BY REFERENCE
 
    Proxy Statement to be filed with the Securities and Exchange Commission in
    connection with the 1997 Annual Meeting of Stockholders is incorporated 
    herein by reference (in Part III).
 

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                                     PART I
 
ITEM 1. BUSINESS
 
GENERAL
 
    AFC Cable Systems, Inc. ("AFC" or the "Company") is a designer, 
manufacturer and supplier of electrical, voice and data distribution products 
used primarily in the construction and modernization of non-residential 
buildings. The Company's products include prewired armored cable, flexible 
conduit, modular wiring systems, electrical fittings and specialty coated 
metals. The Company believes its products offer a total installed cost 
advantage over traditional, labor intensive wiring methods by eliminating 
on-site installation time and labor costs associated with bending, connecting 
and pulling wire through metal pipe. The Company is the leading manufacturer 
of prewired armored cable in the United States, with approximately 45% of the 
sales in the domestic armored cable market based upon Company estimates.
 
    In order to penetrate higher margin, specialty application niche markets,
the Company has focused on the creation of proprietary value-added products
which utilize the Company's design and engineering expertise and various
technologies. These products include color-coded cables used for fire alarm
systems and health care facilities. In addition, the Company offers premise
wiring systems, including The Intelligent Floor and The Intelligent Ceiling,
designed for the modern workstation environment. These premise wiring systems
are custom engineered and pre-assembled by the Company for modular installation
and have the ability to supply the voice, data and electrical requirements
throughout an entire facility.
 
    AFC sells its products principally to leading distributors of electrical 
products and actively targets do-it-yourself ("DIY") customers and original 
equipment manufacturers ("OEMs"). In an effort to include its products in 
preferred project specifications, the Company educates electrical contractors 
and inspectors, construction consultants and architects regarding the 
technological advantages, compatibility and cost savings of the Company's 
products. AFC distributes its products from its fifteen manufacturing, 
warehouse and distribution facilities located throughout the country using 
its own trucking fleet as well as other carriers and from sales 
representatives that carry inventory on consignment.
 
    The Company's products can be separated into two broad categories: armored
cable, flexible conduit, specialty cables, electrical fittings and specialty
coated metals, all manufactured by the Wire and Cable Division, and flexible and
premise wiring systems and related products manufactured by the America Cable
Systems Division. The divisions are vertically integrated in that many of the
products manufactured in the America Cable Systems Division utilize components,
including cable remnants, produced in the Wire and Cable Division.

    The Company's executive offices are located at 50 Kennedy Plaza, Suite 
1250, Providence, Rhode Island 02903, and its telephone number is (401) 
453-2000.
 

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PRODUCTS
 
    WIRE AND CABLE DIVISION.  Wire and Cable Division products are utilized 
for construction (both new and reconstruction, renovation and tenant 
improvement projects) of offices, commercial buildings, industrial plants, 
shopping centers, multifamily dwellings, hotels and health care, educational 
and recreational facilities. Wire and Cable Division products consist 
primarily of armored cable, flexible conduit, specialty cables, electrical 
fittings and connectors and specialty processed metals and accounted for 
$144.3 million, or 89.1%, and $124.4 million, or 89.1%, of the Company's net 
sales for the years ended December 31, 1996 and 1995, respectively. The 
Company is the leading manufacturer of armored cable in the United States, 
with approximately 45% of the domestic market based on current Company 
estimates. Wire and Cable Division products have been listed and labeled 
where required in accordance with Underwriters Laboratories ("UL") standards 
and comply with the National Electrical Code ("NEC"). Wire and Cable Division 
products also meet the standards of the Canadian Standards Association 
("CSA") where required. See "Quality Assurance."
 
    Products manufactured by the Wire and Cable Division include the following:
 
    - ARMORED CABLE is armor sheathed electrical cable that provides a versatile
      and economical alternative to traditional pipe and wire. Fully
      preassembled and tested, armored cable features excellent mechanical
      protection, consistent color coding and a cost effective electrical
      installation. Armored cable products are available in steel or aluminum
      sheathing. Aluminum sheathed armored cable,
 
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      which reduces a product's weight by 30%, has gained wide customer
      acceptance over recent years due to ease of preparation and installation
      and resulting cost savings.
 
       METAL-CLAD (MC) CABLE is a single, steel clad assembly used for power,
       lighting, control and signal circuits. MC has an internal insulated solid
       copper ground wire for sensitive applications, including places of public
       assembly such as convention halls and auditoriums. MC is available in a
       lighter weight aluminum version, MC Lite.
 
       AC-90 is 90 DEG.C rated for branch circuits and feeders in commercial,
       multi-unit residential and industrial applications and for hard wiring
       fixtures and other high temperature applications. Designed for higher
       thermal capability, AC-90 provides more usable power per conductor size.
       AC-90 Lite is the line's lighter weight aluminum version.
 
    - SPECIALTY CABLE products are specialized applications of the Company's
      armored cable designed to meet a particular niche of the commercial
      construction industry.
 
       HCF-90 is AC-90 cable that features a fully insulated ground wire
       providing dual path grounding for branch circuits and feeders where a
       dedicated ground is required. This product is designed primarily for
       health care facilities and has a process-patented green striped armor
       designed to enhance ease of installation and identification. HCF-90 is
       available in a lighter weight aluminum version, HCF-90 Lite.
 
       FIRE ALARM/CONTROL CABLE is MC Cable that features a process-patented red
       striped armor that is designed to enhance identification by fire
       inspectors and prevent accidental disabling of fire security systems.
 
       SUPER NEUTRAL CABLE is MC Cable containing an oversized neutral conductor
       for use in electrical systems in which nonlinear switching loads produce
       additive, third order harmonic currents which may overload standard size
       neutral conductors. Typical applications include computer systems,
       business equipment, variable speed drives, electronic discharge lighting
       and other switching mode power supplies.
 
       JACKETED MC CABLE is MC Cable with an added polyvinyl chloride ("PVC")
       jacket designed for maximum physical circuit protection and
       identification, and is utilized for installations in wet locations, soil
       and concrete.
 
       HOME RUN CABLE is MC Cable that is designed to hold a 6, 8, 12 or 16 wire
       insulated conductor assembly inside galvanized steel armor.
 
    - FLEXIBLE CONDUIT is wireless conduit that provides mechanical protection
      for electrical wiring where flexibility is required. Flexible conduit can
      be made of steel, aluminum or plastic and is used in a variety of
      construction applications as an alternative to pipe.
 
       REDUCED WALL FLEXIBLE CONDUIT provides the strength and durability of
       heavy gauge pipe at 40% less weight. It installs easily and is available
       in sizes from 5/16" to 4" diameter. The Company also offers a Reduced
       Wall Flexible Aluminum Conduit that provides the strength and durability
       of steel at one-third the weight.
 
       LIQUID-TIGHT FLEXIBLE CONDUIT, which is offered in both metallic and
       plastic versions, has been designed for use in factories, foundries and
       assembly plants. It features a flexible conduit covered
 
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       by a PVC jacket and is resistant to oil, gasoline, salt spray and toxic
       fumes. It is available in sizes from 3/8" to 4" diameter.
 
    - OTHER PRODUCTS of the Wire and Cable Division include the following:
 
       SPECIALTY PROCESSED METAL products have developed as a result of the
       Company's ability to handle, slit and coil metals and supply galvanized
       strip steel and various alloys of aluminum oscillate coils to a variety
       of customers primarily in the petroleum drilling industry.
 
       FITTINGS AND CONNECTORS are designed to connect armored cable and conduit
       to electrical junction boxes and to join multiple types of conduit. These
       products compliment the Company's AC, MC and Liquid-Tight product lines.
 
    AMERICA CABLE SYSTEMS DIVISION
 
    America Cable Systems Division products provide an integrated infrastructure
for electrical, voice and data distribution in a modular, plug-in fashion. The
products are used primarily in office buildings and retail centers with
accessible ceilings and/or accessible floors, and can be reused after
retenanting or remodeling. America Cable Systems Division products are
completely preassembled for easy on-site installation and are generally
accompanied by detailed installation drawings produced by computer aided
drafting ("CAD") software. Therefore, these modular wiring products reduce the
time of initial installations, as well as the time required to make changes in
the office layout during the life of the building. The Company continues to
enhance its modular wiring systems used in broader premise wiring markets, which
encompass combined voice, data and electrical distribution. America Cable
Systems Division products have been listed and labeled where required in
accordance with UL and CSA standards and comply with the NEC. See "Quality
Assurance." Sales of America Cable Systems Division products were $16.7 
million, or 10.3%, and $14.2 million, or 10.2%, of the Company's net sales 
for the years ended December 31, 1996 and 1995, respectively.
 
    Products manufactured by the America Cable Systems Division include the
following:
 
    - MODULAR WIRING SYSTEMS provide fast and efficient installation for
      applications such as offices, health care facilities, industrial
      facilities and educational institutions that require repetitive patterns
      of branch circuit lighting fixtures and power outlets as well as a high
      degree of flexibility to meet future needs. The Company estimates that
      facilities can be completely "fitted out" with an integrated building
      electrical infrastructure for lighting and power with total installed cost
      savings of up to 40%.
 
    - THE INTELLIGENT FLOOR AND THE INTELLIGENT CEILING are modifications to the
      standard Modular Wiring System. These products provide an integrated
      modular solution by supplying power distribution and optional voice and
      data capability from the master distribution box to accessible floor and
      ceiling modules and are designed primarily for space efficient
      installation. The Intelligent Floor, which utilizes a patented 
      connector component, is completely modular, providing plug-in access for
      the modern workstation under a raised floor. The Company believes that
      raised floor modular wiring applications, such as The Intelligent Floor,
      significantly reduce electrical related operating costs of office
      buildings and add to present and resale value. The Intelligent Ceiling
      incorporates lighting, power, and telecommunication systems through
      ceiling distribution into a single integrated solution, thereby
      significantly reducing installation time. The Intelligent Ceiling is
      particularly effective in retail malls and health care facilities, which
      traditionally do not employ raised floor systems. The Company has 
      established strategic alliances with a major national manufacturer of
      office equipment and a major manufacturer of raised flooring in an 
      effort to expand the number of distribution channels for The Intelligent
      Ceiling and The Intelligent Floor product offerings.
 
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    - CUSTOM CUTS AND FIXTURE WHIPS provide builders with factory cut branch
      circuit wiring used to connect convenience power receptacles and lighting
      fixtures on the job site. Custom Cuts and Fixture Whips significantly
      reduce installation time for branch circuit power distribution systems.
 
    - PDQ SYSTEM COMPONENTS enable prefabrication of the entire electrical
      branch circuit distribution network at the factory and complete system
      delivery to the job site. PDQ System Components are the electrical devices
      and support mechanisms to which Custom Cut wiring is attached. Through the
      development of a patented specialized connector, prewired switches and
      receptacles already set in electrical boxes can now be plugged together on
      either end of the Custom Cut cable and from leads extending from the
      prewired electrical boxes.
 
    - OTHER CABLE AND LIGHTING PRODUCTS include temporary construction lights,
      power poles, high bay lighting systems and prenumbered and prebundled
      conductors.
 
MARKETING
 
    The Company's products are marketed through approximately 150 independent 
regional sales representatives, including several located outside the United 
States. Sales representatives do not exclusively market the Company's 
products. At December 31, 1996, 32 of the Company's domestic representatives 
maintained product inventories on consignment. The independent sales 
representatives are trained by the Company through a comprehensive marketing 
program that includes a wide range of product literature, specification 
sheets and technical brochures. The Company actively markets its advanced 
engineering capabilities, including CAD, for custom designed integrated 
systems to electrical contractors, construction engineers and building 
contractors. The Company also advertises certain of its product offerings in 
trade magazines and regularly participates in industry trade shows. The 
domestic sales representatives are serviced by the Company's fleet of trucks 
and trailers, which provide delivery and scheduled stock replenishment. The 
Company believes that its internal trucking capability gives it a competitive 
advantage by providing prompt delivery to its customers.
 
    Commensurate with its strategy of promoting armored cable, flexible wiring
and flexible conduit as the preferred alternative to traditional labor intensive
pipe and wire installation methods, the Company has specifically focused its
marketing efforts at electrical contractors and inspectors, construction
consultants, architects and other end users. This marketing strategy is
particularly important to the marketing efforts of the America Cable Systems
Division as its products are often developed to custom specifications. The
Company's in-house telemarketing department and field representatives research
pending construction projects in an effort to change project specifications to
allow for the use of the Company's prewired armored cable products. The Wire and
Cable Division has had particular success with this specification strategy in
the area of specialty cable products where competition is relatively limited.
The Company expects to continue this marketing strategy as it develops new 
products for broader premise wiring markets.
 
    Use of certain of the Company's armored cable products is not currently
permitted by local building codes in a limited number of municipalities,
including Chicago, San Antonio and Toledo. In several instances, the Company has
successfully illustrated to municipal building code authorities the benefits and
efficiencies of armored cable products over pipe and wire installations,
resulting in favorable changes in the particular municipality's building code.
For example, during the past two years, several municipalities, including Dade
County, Florida, Orange County, Florida, the city of Tampa, Florida and
Sacramento County, California, have amended their building codes to approve the
use of the Company's metal clad cables. Although the Company expects to continue
such efforts, there can be no assurance that it will be successful in
influencing other municipalities in adopting similar legislation. The failure to
obtain a change in these local codes is not anticipated to have a material
adverse effect on the Company's business, operating results or financial
condition.
 
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<PAGE>
CUSTOMERS
 
    The Company sells its products primarily to distributors of electrical
products for resale to end users. Sales to distributors accounted for
approximately 87% of the Company's net sales during each of the years ended
December 31, 1996 and 1995. The Company's top ten customers have traditionally
accounted for approximately 30% of the Company's gross sales. In addition to
sales to distributors, the Company directs significant marketing efforts toward
DIY customers. Sales to DIY customers accounted for approximately 7% of the
Company's gross sales for each of the years ended December 31, 1996 and 1995,
and were comprised mostly of armored cable and flexible conduit.
 
COMPETITION
 
    The Company faces competition for many of its core armored cable products 
and for those products manufactured by the America Cable Systems Division. 
The Company, however, has experienced less competition with respect to many 
of its specialty cable products. The Company's competitors include both 
manufacturers of products similar to those of the Company and producers of 
alternative electrical, voice and data distribution systems, predominantly 
pipe and wire. The number and size of the Company's competitors varies 
depending on the product line. Competition can be generally categorized as 
either national in scope, with companies that have substantial financial, 
research and development, manufacturing and marketing resources, or regional 
in scope, with companies that have more limited product offerings but compete 
effectively on the basis of price.
 
    The principal competitive factors in all product markets are price, quality,
product features, availability, customer support and distribution strength. The
relative importance of each of these factors varies depending on the specific
product category. As products mature, such as certain of the Company's core
armored cable products, competitive forces tend to drive down prices. In
contrast, the Company has been able to maintain higher margins on its specialty
cable products and certain of its products manufactured by the America Cable
Systems Division. There can be no assurances, however, that this trend will 
continue.
 
MANUFACTURING
 
    The Company's manufacturing operations utilize a wide variety of raw
materials for which it has multiple commercial sources, and include a broad
variety of processes reflective of the Company's product diversity. See "Raw
Materials." Operations for cable manufacturing at the Wire and Cable Division
include drawing copper wire; extruding wire; slitting and galvanizing steel and
aluminum used for armor; wrapping, twisting and cutting wire; armoring
conductors; and testing for conductor continuity and grounding. The Company's
manufacturing equipment allows for a wide assortment of product categories with
armored cable diameters ranging from 1/4" to 2" and flexible conduit diameters
ranging from 5/16" to 4". The America Cable Systems Division manufacturing
operations primarily consist of metal stamping, riveting, custom wire cutting,
custom assembly and packaging operations. This division utilizes proprietary
tooling in its assembly techniques. Manufacturing operations at the Company's
two divisions are vertically integrated, which enables the Company to source
primary raw materials at favorable prices and terms, control inventories and
better manage lead times. The America Cable Systems Division uses remnants from
the Wire and Cable Division in its manufacturing process, thereby reducing the
Company's overall scrap ratio.
 
RAW MATERIALS
 
    Copper, steel and aluminum used in manufacturing represented approximately
63% of cost of goods sold for the year ended December 31, 1996. The principal
raw material used by the Company is copper, which is purchased in the form of
redrawn rod from several domestic producers. Price terms are based on monthly
average copper prices, as determined by the New York Commodity Exchange, plus a
premium. The Company believes world stocks and capacity continue to be adequate
to meet market needs. At
 
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December 31, 1996, the Company had agreed to purchase the majority of its 1997
copper usage from two vendors. Other raw materials used by the Company include 
aluminum, galvanized steel, molding materials, PVC and nylon, for which the 
Company generally has either alternative sources of supply or access to 
alternative materials. Supplies of these materials are adequate and are 
expected to remain so for the foreseeable future.
 
QUALITY ASSURANCE
 
    The Company is committed to the philosophy that meeting industry standards
and codes is critical to its success, and its products are designed to satisfy
the safety and performance standards set by various industrial groups and
testing laboratories. Underwriters Laboratories, a nonprofit, independent
organization, operates a listing service for electrical and electronic materials
and equipment. UL listing is required by national and most local electrical
codes in the United States, and UL conformity assessment includes testing,
evaluation and certification. UL inspectors visit the Company's various
facilities on a regular basis.
 
    The Canadian Standards Association is the UL equivalent in Canada. Like 
UL listing, CSA listing is product based and is awarded after testing and 
evaluation. The British Approval Service for Cables ("BASEC") provides 
product assessment and certification for cable products which are intended 
for use in the United Kingdom. Other European Community countries currently 
rely on UL or BASEC approval or certification for cable products.
 
    In addition to standards organizations, the Company's products are 
designed to comply with required electrical code requirements, particularly 
the NEC and federal specifications. The NEC, administered by the National 
Fire Protection Association ("NFPA"), sets the minimum safety standards to 
which electrical products are manufactured and installed in the United 
States. NEC standards are enforced and supplemented by the appropriate State, 
county and municipal authorities having jurisdiction. Federal specifications 
detail the requirements for all electric products to be installed in federal 
buildings.
 
    The Company has implemented a Total Quality Management ("TQM") program which
is intended to maximize customer satisfaction while implementing cost effective
production methods. The Company's TQM program embodies an interlocking set of
procedures and practices that ensures employees in various departments are
adequately trained and directed to continuously implement improvements in
quality, service and cost savings. In connection with its TQM program, the
Company has obtained ISO 9001 certification at two of its facilities in New
Bedford, Massachusetts and ISO 9002 certification at its Byesville, Ohio
facility. ISO 9001 certification is a standard developed by the International
Standards Organization that provides a management systems model for process
quality assurance in design, development, installation and servicing. ISO 9002
is a quality systems model for quality assurance in production, installation and
servicing. The Company believes that ISO 9001 and 9002 certifications signify
excellence in manufacturing and process integrity, thereby serving as a
competitive advantage and strengthening its marketing efforts. There can be no
assurance, however, that further certifications will be granted. The Company
believes that if additional certifications are not granted at its other
facilities, its business and competitive position will not be materially
adversely affected.
 
DEVELOPMENT, DESIGN AND ENGINEERING
 
    The Company employs 27 draftsmen and engineers and 16 professional
technicians that are actively engaged in product and process development.
Development and design efforts often result from informal dialogues with major
electrical contractors, consulting engineers and facility managers, and
generally include product development, testing and analysis, component
development and testing, tooling design and resolution of process problems. The
Company fabricates some of the tooling and key machinery used in its cable
production.
 
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    The Company takes an active role in guiding industry standards.  The 
Company has representatives on the electrical section of the NFPA and the 
Industry Advisory Council of UL and maintains ongoing relations with 
standards enforcement organizations such as UL, the NFPA, the International 
Association of Electrical Inspectors, the National Armored Cable 
Manufacturers Association and the National Electrical Manufacturing 
Association.
 
PATENTS, TRADEMARKS AND OTHER INTELLECTUAL PROPERTY
 
    The Company believes that its success depends more heavily on name
recognition, technical competence and the marketing abilities of its sales
representatives than on any individual patent, trademark or copyright.
Nevertheless, the Company intends to seek patent coverage for its products and
manufacturing technology where appropriate. The Company holds several patents
covering certain of its products and processes and also has several registered
trademarks. Although in the aggregate these patents and trademarks are of
considerable importance to the manufacturing and marketing of many of Company's
products, the Company does not consider any single patent or trademark or group
of patents or trademarks to be material to its business as a whole.
 
    The Company also relies upon trade secret protection for its confidential
and proprietary information. The Company routinely enters into confidentiality
agreements with its employees. There can be no assurance, however, that others
will not independently obtain similar information and techniques or otherwise
gain access to the Company's trade secrets or that the Company can effectively
protect its trade secret.
 
BACKLOG
 
    The Company's business is characterized by short-term order and shipment
schedules rather than volume purchase contracts. Accordingly, the Company does
not consider backlog at any given date to be indicative of future sales.
Immediate delivery requirements and the nature of the Company's business
preclude any significant backlog.
 
EMPLOYEES
 
    At December 31, 1997 the Company had 749 full-time employees, of which 
465 employees were represented by labor unions. The Company's union contracts 
expire July 31, 1998, June 30, 1999 and February 4, 2000. Of the Company's 
employees, 61 are in administration, 36 in sales and marketing, 38 in 
engineering, 560 in manufacturing and 54 in distribution. The Company has not 
experienced any work stoppages at its plants and believes its current 
relations with its employees are good.
 
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                               ITEM 2. PROPERTIES
 
    The following table provides information with respect to the Company's
facilities:
 
<TABLE>
<CAPTION>
                                                                                                          OWNED/
LOCATION                                                     FACILITY TYPE                  SQUARE FEET   LEASED
--------------------------------------------  --------------------------------------------  -----------  ---------
<S>                                           <C>                                           <C>          <C>
New Bedford, MA (1)                           Assembly-America Cable Systems Division,
                                              Fittings and
                                              Connectors, Administration, Engineering          123,000   Owned
New Bedford, MA                               Manufacturing-Cable, Warehousing                  71,700   Owned
New Bedford, MA                               Manufacturing-Wire, Administration,
                                              Engineering                                       64,000   Owned
New Bedford, MA                               Trucking, Warehousing                             44,000   Leased
New Bedford, MA                               Warehousing                                       15,000   Leased
Fullerton, CA                                 Manufacturing-Conduit and Armor Cable,
                                              Warehousing                                       59,800   Leased
Largo, FL                                     Manufacturing-Conduit and Cable                   43,200   Leased
Largo, FL                                     Warehousing                                       20,500   Leased
Ottawa, IL                                    Manufacturing-Modems and Connectors               21,000   Owned
Burlington, NJ                                Manufacturing-Conduit and Cable, 
                                              Warehousing                                       84,500   Leased
Hackettstown, NJ                              Manufacturing-Photo Controls and Electrical
                                              Devices,
                                              Warehousing                                       40,000   Leased
Linden, NJ                                    Distribution Center                               23,800   Leased
Byesville, OH                                 Manufacturing-Metal Processing                    37,000   Leased
Bensalem, PA                                  Manufacturing-Metal Processing                    28,800   Leased
Providence, RI                                Administration                                     2,100   Leased
Dallas, TX                                    Manufacturing-America Cable Systems
                                              Division                                          25,000   Leased
</TABLE>
 
(1)   This property secures the repayment of the proceeds received from the
      issuance of the Industrial Revenue Bonds issued by the Massachusetts
      Industrial Finance Agency in July 1996. See Item 7--"Management's 
      Discussion and Analysis of Financial Condition and Results of 
      Operations."

ITEM 3. LEGAL PROCEEDINGS
 
    The Company is a party to various nonenvironmental legal proceedings and
administrative actions, all of which are incidental to the operations of the
Company. In the opinion of the Company's management, such proceedings and
actions should not, individually or in the aggregate, have a material adverse
effect on the Company's financial condition or results of operations.
 
    Regarding environmental matters, owners and operators of sites containing
hazardous substances, as well as generators of hazardous substances, are subject
to broad liability under various federal and State environmental laws and
regulations, including liability for clean up costs and damages arising out of
past disposal activity. The principal raw material used by the Company is
copper, which is classified as a hazardous substance. In addition, prior to the
Company's acquisition of its present business, it was engaged
 
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in certain activities that may have utilized other hazardous substances.
Governmental authorities may seek to impose liability regardless of fault or the
legality of the original disposal activity and regardless of whether the Company
is otherwise currently responsible for liabilities with respect to such
activities. The Company has been named in connection with certain proceedings
relating to various properties currently being investigated or remediated for
environmental problems arising therefrom. The Company's business was formerly
operated as American Flexible Conduit Company Inc. ("American"), a manufacturer
of flexible conduit and armored cable products, which commenced operations in
1926. In 1969, Nortek, Inc. ("Nortek") purchased the assets and liabilities of
American and subsequently transferred the business to its Monogram Industries,
Inc. ("Monogram") subsidiary, incorporated in Delaware in September 1969. In
December 1989, a corporation controlled by Mr. Papitto purchased Monogram from
Nortek. The purchasing corporation and Monogram were subsequently merged, with
Monogram becoming the surviving corporation. In October 1993, the Company
changed its name to AFC Cable Systems, Inc. Prior to the sale of the stock of
Monogram by Nortek in December 1989, Monogram transferred to another 
subsidiary of Nortek all the assets and liabilities associated with the 
businesses not related to the Company's present business operations. In 
connection with the sale of the stock of Monogram, Nortek agreed to indemnify 
the Company, subject to certain limitations, for liabilities and obligations 
of Monogram unrelated to the business operations of Nortek's American 
Flexible Conduit Division, which had been transferred to the Company in 
connection with such sale. With the exception of property discussed below 
located in New Bedford, Massachusetts (the "Sullivans Ledge Site") all of the 
properties being investigated or remediated are unrelated to the business 
operations acquired.
 
    In 1984, the United States Environmental Protection Agency ("EPA") placed
the Sullivan's Ledge Site on the National Priorities List, which is a list of
sites that the EPA has ranked in terms of priority for remedial action pursuant
to the Comprehensive Environmental Response, Compensation, and Liability Act
("CERCLA"). Under CERCLA, all owners and operators (former and current) and
generators can be found jointly and severally liable with respect to the
Sullivan's Ledge Site. In March 1990, the EPA requested information from the
Company, and the Company admitted that between 1960 and 1969, American, the
predecessor of the business currently operated by the Company, had disposed of
waste metal at the site. A number of responsible parties entered into a consent
decree with regard to a portion of the Sullivan's Ledge Site in June 1991 and,
subsequently, such parties as plaintiffs (the "Plaintiffs") have sought
contribution in the United States District Court for the District of
Massachusetts from twelve corporations, including the Company and Nortek,
neither of which were named as potentially responsible parties by the EPA. In
the consent decree, the EPA estimated the cost of remediation at the Sullivan's
Ledge Site to be approximately $10-$12 million. The Company has defended and
will continue to defend the action based upon its belief that its predecessors
contributed only DE MINIMIS amounts of waste material. On December 17, 1996, the
United States District Court for The District of Massachusetts entered a
judgment in favor of the Company with respect to this claim. The time period
during which the Plaintiffs may file an appeal has not yet lapsed.
 
    The Company is not able to predict with certainty the extent of its ultimate
liability with respect to any pending or future environmental matters. However,
the Company does not believe that any such liability with respect to the
aforementioned environmental matters would have a material adverse effect upon
its financial condition or results of operations.
 
          ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
    The Company did not submit any matters during the fourth quarter of the
fiscal year covered by this report to a vote of the security holders through the
solicitation of proxies or otherwise.
 
                                       11
<PAGE>
ITEM 4A. EXECUTIVE OFFICERS OF THE REGISTRANT
 
<TABLE>
<CAPTION>
                                                                                                     EXECUTIVE OFFICER
NAME                          AGE                       POSITION                                            SINCE
---------------------------   ---      -----------------------------------------                ---------------------
<S>                           <C>           <C>                                                     <C>
 
Ralph R. Papitto              70            Chairman of the Board and Chief Executive Officer       December 1989
 
Robert R. Wheeler             52            President and Chief Operating Officer                   October 1995
 
Raymond H. Keller             59            Vice President and Chief Financial Officer              December 1989

</TABLE>
 
BUSINESS EXPERIENCE OF EXECUTIVE OFFICERS
 
    Ralph R. Papitto has been Chairman of the Board and a Director of the 
Company since December 1989. Mr. Papitto has been Chief Executive Officer 
since 1995. Until 1990 Mr. Papitto was the Chairman of the Board, Chief 
Executive Officer and a director of Nortek, an industrial conglomerate. Mr. 
Papitto founded Nortek in 1967. In 1956, Mr. Papitto founded Glass-Tite 
Industries, Inc. ("Glass-Tite"), a manufacturer of electronic semiconductor 
components. Glass-Tite was acquired by GTI Corporation ("GTI") in 1963. Mr. 
Papitto served as Chairman of the Board of GTI Corporation until 1966. Mr. 
Papitto is also a director of Lynch Corporation, a communications and 
multi-media services company.
 
    Robert R. Wheeler has been President and Chief Operating Officer of the 
Company since December 1995 and a Director of the Company since March 1996. 
Mr. Wheeler was Executive Vice President and Chief Operating Officer of the 
Company from October 1995 to December 1995. From 1992 to 1995, Mr. Wheeler 
had been President and Chief Executive Officer of The North American 
Industrial Company of BICC Cable, Inc.
 
    Raymond H. Keller has been Vice President and Chief Financial Officer of 
the Company since December 1989 and a Director of the Company since October 
1993. From January 1989, he served as the Vice President and Chief Financial 
Officer of the American Flexible Conduit Division of Nortek. Prior to that 
time, Mr. Keller held several positions with Microdot, Inc., a multi-industry 
components manufacturer, most recently as Vice President and Chief Financial 
Officer of the Microdot, Inc. operating companies. Mr. Keller had been 
employed by Microdot, Inc. since 1972.
 
 
                                       12
<PAGE>
                                    PART II
 
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
 
    The Company's Common Stock is quoted on the Nasdaq National Market under 
the symbol "AFCX." The following table sets forth for the two most recently 
completed fiscal years the high and low closing sale prices for the Common 
Stock as reported on the Nasdaq National Market:
 
<TABLE>
<CAPTION>
                             HIGH        LOW
                           ---------     ---------
<S>                         <C>           <C>
 
1995
 
First Quarter               17            12 1/2
 
Second Quarter              19 1/2        15 1/4
 
Third Quarter               20 3/8        16 3/4
 
Fourth Quarter              18 1/4        11 1/4
 
1996
 
First Quarter               14 3/4        11 7/8
 
Second Quarter              17 1/2        13 1/4
 
Third Quarter               18 1/2        15 1/2
 
Fourth Quarter              23 7/8        17
</TABLE>
 
    Since its initial  public offering in 1993, the Company has not declared 
or paid a cash dividend on its Common Stock and does not intend to do so in 
the foreseeable future. The Company's current policy is to retain its 
earnings, if any, to finance expansion and product development. Payment of 
dividends in the future will depend on the earnings and financial condition 
of the Company and such other factors as the Company's Board of Directors may 
consider or deem appropriate at the time.

    As of March 24, 1997, there were approximately 67 holders of record of the
Company's Common Stock and approximately 800 beneficial Shareholders.
 
ITEM 6. SELECTED FINANCIAL DATA (IN THOUSANDS, EXCEPT PER SHARE DATA)
 
    The following financial information is qualified by reference to, and should
be read in conjunction with, the Company's financial statements, including the
notes thereto, and "Management's Discussion and Analysis of Financial Condition
and Results of Operations" included elsewhere in this report. For the fiscal
year ended December 31, 1992 and for the short tax year from January 1 through
December 16, 1993, the consummation date of the Company's initial public
offering ("IPO"), the Company elected to be
 
                                       13
<PAGE>
treated for income tax reporting purposes as an S corporation under the Internal
Revenue Code.
 
<TABLE>
<CAPTION>
                                               YEAR ENDED DECEMBER 31,
                            ------------------------------------------------------------------
                               1992             1993             1994          1995         1996
                            ----------------  -------------  ------------  -----------  ------------
<S>                         <C>               <C>            <C>           <C>          <C> 
Income Statement
  Data:
 
Net sales............       $78,453           $89,890        $  114,386    $  139,483    $  161,868
 
Cost of goods sold...        59,085            66,775            82,497       107,087       118,487
                           ------------     -----------       ----------    ----------    ----------  
 
Gross profit.........        19,368            23,115            31,889        32,396        43,381
 
Selling, general and
administrative
  expenses...........        15,125             16,460           21,491        21,926        26,384
 
Owners'
  compensation(1)....         2,081              3,141               --            --            --
                           ------------     -----------       ----------    ----------    ----------  
 
Income from
  operations.........         2,162              3,514           10,398        10,470        16,997
 
Other income
  (expense), net.....           330               (23)              160            39          (48)
 
Investment income....           --                  14               80         3,001         2,339
 
Interest expense......        1,405              1,142              176           614           728
                           ------------     -----------       ----------    ----------    ----------   

Income before
  taxes..............         1,087              2,363           10,462        12,896        18,560
 
Income taxes.........            --              1,209            4,269         4,791         7,100
                           ------------    ------------       ----------    ----------    ----------

Net income (loss)(2).        $1,087             $1,154       $    6,193    $    8,105    $   11,460
                           ------------     -----------       ----------    ----------    ----------   
                           ------------     -----------       ----------    ----------    ----------   
 
Earnings per common
  share..............                             $.33       $     1.12    $     1.12    $     1.54
                                            -----------       ----------    ----------    ----------   
                                            -----------       ----------    ----------    ----------   
 
Average shares         
  outstanding and
  common stock                                         
  equivalents........                        3,477,083        5,527,078     7,234,075     7,421,179
                                           -----------       ----------    ----------    ----------   
                                           -----------       ----------    ----------    ----------   

</TABLE>
 
(Footnotes appear on following page)
 
                                       14
<PAGE>

<TABLE>
<CAPTION>
                                                                    DECEMBER 31,
                                              ---------------------------------------------------------
                                                1992       1993         1994         1995       1996
                                              ---------  ---------  -------------  ---------  ---------
<S>                                           <C>        <C>        <C>            <C>        <C>
Cash and cash equivalents...................    $   324  $   2,986  $  2,571        $ 2,090    $   980
Working capital.............................      4,831     14,485    17,789         48,099     58,959
Total assets................................     28,810     33,953    50,254         84,784     97,923
Short-term debt.............................      9,098      1,250     3,500          6,925      2,270
Long-term debt..............................      9,420         --     --                --      3,300
Total liabilities...........................     26,097     12,155    19,867         23,473     24,933
Stockholders' equity........................      2,713     21,798    30,387         61,311     72,990
 
</TABLE>
 
------------------------
 
(1) Includes amounts distributed to the Company's stockholders as additional
    compensation, a portion of which was to provide those stockholders with
    funds to pay their income taxes, which included income taxes on the
    Company's income. The portion of such additional compensation in excess of
    the stockholders' income tax obligations was loaned back to the Company.
 
(2) Pro Forma net income after considering the following adjustments is 
    $3,584,000, or .67 per common share (5,340,645 average common shares and
    common stock equivalents assumed to be outstanding after the IPO. The
    adjustments (i) reduce the level of compensation to the Company's
    stockholders by $2.5 million in 1993, based upon current compensation
    practices as determined by written agreement and the Company's compensation
    committee, (ii) provide related income taxes (at an assumed rate of 40%)
    based on pro forma income before income taxes as if the Company were taxed
    as a C corporation and (iii) reflect the reduction in interest expense of
    $1.1 million in 1993 resulting from the conversion of certain of the
    Company's subordinated debt to equity and the repayment of certain debt
    from proceeds of the IPO.



                                    15

<PAGE>
 
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS
 
    THIS REPORT CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS WITHIN THE 
MEANING OF SECTION 21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 
THESE STATEMENTS INCLUDE, AMONG OTHERS, STATEMENTS RELATING TO FUTURE EVENTS 
OR THE FUTURE FINANCIAL PERFORMANCE OF THE COMPANY. SUCH STATEMENTS ARE ONLY 
EXPECTATIONS AND ACTUAL EVENTS OR RESULTS MAY DIFFER MATERIALLY. FACTORS 
WHICH COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE INDICATED IN 
SUCH FORWARD-LOOKING STATEMENTS ARE SET FORTH IN "FACTORS THAT MAY AFFECT 
FUTURE PERFORMANCE."


RESULTS OF OPERATIONS
 
    Year Ended December 31, 1996 versus Year Ended December 31, 1995
 
    NET SALES.  Net sales for the year ended December 31, 1996 increased $22.4
million, or 16.1%, to $161.9 million from $139.5 million for the year ended
December 31, 1995. Net sales for the Wire and Cable Division increased by $19.9
million, or 16.0%, to $144.3 million for the year ended December 31, 1996 from
$124.4 million for the year ended December 31, 1995. Contributing to the
increase were additional sales of the Company's traditional armored cable and
flexible conduit products as well as increased sales of the Company's higher
margin specialty application cables. Also contributing to this increase were
higher sales of fittings and connectors and specialty coated metal products
introduced by the Company in early 1995. Net sales for the America Cable Systems
Division increased by $2.5 million, or 17.6%, to $16.7 million for the year
ended December 31, 1996 from $14.2 million for the year ended December 31, 1995.
This increase is attributable to improved demand for modular wiring systems,
including The Intelligent Floor and The Intelligent Ceiling products.
 
    GROSS PROFIT.  Gross profit for the year ended December 31, 1996 increased
$11.0 million, or 33.9%, to $43.4 million from $32.4 million for the year ended
December 31, 1995. Gross margin increased to 26.8% for the year ended December
31, 1996 from 23.2% for the year ended December 31, 1995. This increase is
attributable to (i) decreased cost of raw materials through more efficient
purchasing, lower market prices of commodities and improved manufacturing
processes resulting in better yields on materials and (ii) increased sales of
higher margin specialty application products.
 
    INCOME FROM OPERATIONS.  Income from operations for the year ended December
31, 1996 increased $6.5 million, or 62.3%, to $17.0 million from $10.5 million
for the year ended December 31, 1995. Income from operations as a percentage of
net sales increased to 10.5% for the year ended December 31, 1996 from 7.5% for
the year ended December 31, 1995. This increase resulted from improved gross
margin, but was partially offset by an increase in selling, general and
administrative expenses attributable to increases in freight costs, sales
agent commissions, compensation expense and fees for professional services.
 
    NET INCOME.  Net income for the year ended December 31, 1996 increased $3.4
million, or 41.4%, to $11.5 million from $8.1 million for the year ended
December 31, 1995. Net income as a percentage of net sales increased to 7.1% for
the year ended December 31, 1996 from 5.8% for the year ended December 31, 1995.
This increase was primarily due to increased income from operations, partially
offset by a slight decline in other income, which consisted primarily of income
on investments in securities, and a higher effective tax rate of 38.2% for the
year ended December 31, 1996 compared to 37.2% for the year ended December 31,
1995 which was due to a higher marginal tax rate in 1996.
 


                                   16

<PAGE>


    Year Ended December 31, 1995 versus Year Ended December 31, 1994
 
    NET SALES.  Net sales for the year ended December 31, 1995 increased $25.1
million, or 21.9%, to $139.5 million from $114.4 million for the year ended
December 31, 1994. Net sales for the Wire and Cable Division increased $22.4
million, or 22.0%, to $124.4 million for the year ended December 31, 1995 from
$102.0 million for the year ended December 31, 1994. Contributing to the
increase were strong sales of the Company's traditional armored cable and
flexible conduit products, specialty cables and metals and sales related to the
new electrical fittings and connectors line of products. A portion of this
increase was also attributable to the acquisition of Kaf-Tech in the third
quarter of 1994. Net sales for the America Cable Systems Division increased $2.8
million, or 24.6%, to $14.2 million for the year ended December 31, 1995 from
$11.4 million for the year ended December 31, 1994. This increase is
attributable to improved demand for modular wiring systems and sales by this
division's pre-fabricated electronic distribution unit which was acquired in the
first quarter of 1995.
 
    GROSS PROFIT.  Gross profit for the year ended December 31, 1995 increased
$0.5 million, or 1.6%, to $32.4 million from $31.9 million for the year ended
December 31, 1994. Gross margin decreased to 23.2% for the year ended December
31, 1995 from 27.9% for the year ended December 31, 1994. This decrease was
attributable to (i) fluctuations in the price of metals that were not offset by
corresponding selling price adjustments in the Company's products, (ii) lower
margins at the Company's new advanced metals processing facility in Byesville,
Ohio and new cable fittings operation in New Bedford, Massachusetts, (iii) price
competition in traditional cable products and (iv) a shift in product mix.
 
    INCOME FROM OPERATIONS.  Income from operations for the year ended December
31, 1995 increased $72,000, or 0.7%, to $10.5 million from $10.4 million for the
year ended December 31, 1994. Income from operations as a percentage of net
sales decreased to 7.5% for the year ended December 31, 1995 from 9.1% for the
year ended December 31, 1994. This decrease was primarily attributable to the
decline in gross margins for 1995 compared to 1994.
 
    NET INCOME.  Net income for the year ended December 31, 1995 increased 
$1.9 million, or 30.9%, to $8.1 million from $6.2 million for the year end 
December 31, 1994. Net income as a percentage of net sales increased to 5.8% 
for the year ended December 31, 1995 from 5.4% for the year ended December 
31, 1994. Contributing to this increase was $3.0 million of investment income 
for the year ended December 31, 1995 compared to $80,000 of investment income 
for year ended December 31, 1994. This increase in investment income resulted 
primarily from the application of the net proceeds from the February 1995 
Common Stock offering. Another factor in this increase was a lower effective 
tax rate of 37.2% for the year ended December 31, 1995 compared to 40.8% for 
the year ended December 31, 1994.
 
 
                                       17

<PAGE>

 
LIQUIDITY AND CAPITAL RESOURCES
 
    The Company's short-term liquidity needs have generally consisted of 
operating capital necessary to finance inventories and receivables. Long-term 
liquidity needs generally relate to capital expenditures necessary to expand 
the production capacity of its manufacturing operations. The Company has 
satisfied its short- and long-term liquidity needs with cash generated from 
operations and proceeds from the public offering of its Common Stock in early 
1995, supplemented by available borrowings under its revolving line of credit 
and proceeds from the Industrial Revenue Bonds ("IRBs") issued by the 
Massachusetts Industrial Finance Agency in July 1996. The Company expects 
that it will meet its ongoing working capital needs for the next twenty-four 
months primarily with cash generated from operations and the net proceeds 
from the offering of Common Stock which the Company expects to complete 
during the second quarter of 1997 ("1997 Offering"), supplemented by 
available borrowings under its revolving line of credit.
 
    Cash generated from operations totaled $11.5 million and $4.4 million for
the years ended December 31, 1996 and 1994, respectively, and was attributable
primarily to increased profitability. Cash used in operations was $1.3 million
for the year ended December 31, 1995, primarily due to an increase in
inventories and accounts receivable. Working capital on December 31, 1996 was
$59.0 million and the ratio of current assets to current liabilities was 4.08 to
1.00. The Company's average inventory of $20.0 million for the year ended
December 31, 1996 represented an increase of $2.6 million over the average
inventory of $17.4 million for the year ended December 31, 1995.
 
    Accounts receivable at December 31, 1996 were $3.3 million higher than the
balance at December 31, 1995 due primarily to increased sales. For the year
ended December 31, 1996 average day sales outstanding were 54 compared to 56 for
the year ended December 31, 1995. At December 31, 1996, accounts receivable over
60 days represented 1.7% of accounts receivable.
 
    Capital expenditures for the year ended December 31, 1996 of $7.0 million 
were for new or replacement production equipment to increase manufacturing 
capacity and for the new manufacturing facility in New Bedford, 
Massachusetts. Capital expenditures amounted to $2.3 million and $3.6 million 
for the years ended December 31, 1995 and 1994, respectively. For the years 
ended December 31, 1996, 1995 and 1994, the Company leased certain 
manufacturing equipment valued at $1.7 million, $2.0 million and $4.8 
million, respectively. Of the $4.8 million in 1994, $3.6 million relates to 
the Byesville, Ohio facility. Capital expenditures for 1997 are expected to 
be approximately $7 million, primarily for the purchase of new armored cabling 
machines, including related equipment, and extruders.
 
    At December 31, 1996, bank indebtedness under the Company's unsecured
revolving line of credit was $2.0 million. This revolving line of credit
terminates on March 31, 1999 and provides for direct borrowings of up to $25.0
million, including letter of credit borrowings up to $3.0 million. Up to $10.0
million of the line of credit may be used without the lender's prior consent for
business acquisitions. At December 31,
 
                                       18
<PAGE>
1996, letters of credit totaling approximately $0.8 million were outstanding
under the line of credit. Borrowings under the line of credit averaged $7.5
million for the year ended December 31, 1996. The Company expects to pay the
outstanding balance of the line of credit with a portion of the net proceeds of
the 1997 Offering. See "Use of Proceeds."
 
    Borrowings under the revolving line of credit are available at interest
rates equal to either the lender's base rate or the Eurodollar rate plus 0.5% to
1.25% for a fixed period of one, two, three or six months. At December 31, 1996,
the weighted average cost of borrowings under the line of credit was 6.3%. The
line of credit contains certain restrictive covenants, including the requirement
that the Company maintain minimum levels of tangible capital funds and meet
other specified ratio requirements.
 
    During 1996, the Company was loaned the proceeds from the issuance of $3.57
million in Industrial Revenue Bonds by the Massachusetts Industrial Finance
Agency for the purpose of acquiring and refurbishing a 99,000 square-foot
manufacturing facility in New Bedford, Massachusetts, which secures the IRBs.
The IRBs mature on July 24, 2016 and carry an average interest rate of
approximately 3.5% adjustable on a weekly basis. In addition, an annual fee of
1.0% of the amount of an unsecured stand-by letter of credit is payable to the
bank holding the letter of credit and also acting as trustee under the terms of
the IRB issuance. The Company has the right to convert from the variable
interest rate to a fixed rate established at the time of conversion. The bonds
are payable in nineteen annual installments of $180,000 with a final payment of
$150,000 due at maturity, all funded through monthly payments of $15,000 to the
trustee over the twelve months preceding the installment due dates.
 
 
INFLATION AND FOREIGN EXCHANGE FLUCTUATION
 
    The Company believes that inflation has not had a material effect on its
business, operating results or financial condition during the three-year period
ended December 31, 1996. While the Company does not believe that its business is
highly sensitive to inflation, there can be no assurance that future increases
in the rate of inflation would not have a material adverse effect on the
Company's operations.
 
    The Company is currently not exposed to foreign exchange risk because
foreign sales are denominated in U.S. dollars to U.S.-based trading companies.
The Company may seek to manage any such future risk by entering into foreign
exchange contracts as management deems appropriate.
 
                                       19

<PAGE>

FACTORS THAT MAY AFFECT FUTURE PERFORMANCE

    SUBSTANTIAL PRICE COMPETITION, MARGIN MAINTENANCE AND PRICES OF RAW 
MATERIALS.  Price competition for the Company's core products is significant, 
and the Company sells its products in accordance with prevailing market 
prices. Copper rod is the principal raw material used in the Company's 
manufacturing operations, accounting for approximately 31% of cost of goods 
sold for the year ended December 31, 1996. The Company expects that copper 
will continue to account for a significant portion of the cost of goods sold 
in the future. Historically, the price of copper has fluctuated significantly 
(i.e. between $121.20 and $145.90, and $86.85 and $130.10 per 100 pounds in 
1995 and 1996, respectively). The Company's other principal raw materials 
include steel and aluminum, which collectively accounted for approximately 
32% of cost of goods sold for the year ended December 31, 1996. Although in 
the past these raw materials have not been subject to the same degree of 
price volatility as copper, there can be no assurance that significant 
fluctuations will not occur in the future. The Company attempts to insulate 
its products from these price fluctuations through improved purchasing 
procedures and appropriate selling price adjustments. There can be no 
assurance, however, that the Company will be able to maintain acceptable 
gross profit margins on product sales in the future and, if it is unable to 
do so, its business, operating results and financial condition could be 
adversely affected. The Company does not currently engage in metal futures 
trading or other hedging activities, but does have various producer supply 
contracts, which currently expire on December 31, 1997 and under which the 
Company purchases copper in any given month at a price equal to the average 
copper selling prices, as determined by the New York Commodity Exchange, for 
the month of shipment plus a premium. The Company may engage in hedging 
activities in the future as management deems appropriate.
 
    MANAGEMENT OF GROWTH.  The Company has experienced rapid growth,
particularly during the last three years. The continued rapid growth of the
Company could place a significant strain on its management and other resources.
The Company anticipates that continued growth, if any, will require it to
continue to recruit, hire, train and retain a substantial number of new and
highly skilled product development, administrative, information technology,
finance, sales and marketing and support personnel. The Company's ability to
compete effectively and to manage future growth, if any, will depend on its
ability to continue to implement and improve operational, financial and
management information systems on a timely basis and to expand, train, motivate
and manage its work force. Should the Company continue to experience rapid
growth, there can be no assurance that the Company's personnel, systems,
procedures and controls will be adequate to support the Company's operations or
that management will adequately anticipate all demands that growth will place on
the Company. If the Company's management is unable to manage growth effectively,
the quality of the Company's products and its business, operating results and
financial condition could be materially adversely affected. See "--Integration
of Acquisitions." 
                                       20

<PAGE>

    INTEGRATION OF ACQUISITIONS.  The Company intends to grow its business by 
pursuing selective acquisitions of companies with products complementary to 
its existing business. Acquisitions involve numerous risks, including 
difficulties in the assimilation of the operations, technologies and 
products, the diversion of management's attention from other business 
concerns, risks of entering markets in which the Company has no or limited 
direct prior experience, operating companies in different geographical 
locations, and the potential loss of key employees of the acquired company. 
Future acquisitions by the Company could result in potentially dilutive 
issuances of equity securities, the incurrence of debt and contingent 
liabilities and amortization expenses related to goodwill and other 
intangible assets, which could materially adversely affect the Company's 
operating results and financial condition. There can be no assurance that 
future acquisitions can be successfully integrated or that management will be 
successful in managing the combined operations. See "--Management of Growth."

    DEPENDENCE ON NEW PRODUCTS AND PRODUCT IMPROVEMENTS.  The commercial
construction industry and the evolution of the modern workstation are
characterized by advances in electrical distribution and communications systems
which require ongoing improvements in the capabilities of wire and cable
products. The Company believes that its future success will depend in part upon
its ability to enhance existing products and to develop and manufacture new
products that meet or anticipate such changes. The failure to introduce new or
enhanced products on a timely and cost competitive basis could have an adverse
impact on the Company's business, operating results or financial condition.
 
    MANUFACTURING CAPACITY.  The Company is currently operating at or near 
capacity in nearly all of its manufacturing facilities. Although the Company 
has plans to open additional facilities and expand its capacity at others, 
there can be no assurance that these additional facilities or expansions will 
be completed on time and/or on budget, that the Company will not experience 
manufacturing delays or problems, or that adequate equipment and personnel 
will be available to operate these new facilities. The additional facilities 
and equipment will also require substantial funds. The Company anticipates 
that the estimated net proceeds of the 1997 Offering, borrowings and existing 
cash will be adequate to fund its planned expansions. See "Management 
Discussion and Analysis of Financial Condition and Results of 
Operations--Liquidity and Capital Resources." If the Company experiences 
significant delays or problems in implementing its current plans, such delays 
or problems could have a material adverse effect on the Company's business, 
results of operations or financial condition. 

                                       21

<PAGE>


 
    VOLATILITY OF NEW CONSTRUCTION MARKET.  The volatility of the nonresidential
new construction market has a direct impact on sales of certain of the Company's
products. Certain regions of the United States have experienced, and in the
future may experience, significant economic recessions that have reduced, or may
reduce, the number of nonresidential new construction projects, which in turn
could adversely affect the Company's business, operating results and financial
condition. The Company has historically derived a substantial portion of its
sales from the building modernization market, which has not been significantly
adversely affected by downturns in the nonresidential new construction market.
There can be no assurance, however, that the modernization market will not enter
a downturn or that the Company's sales will not be affected by future downturns
in the nonresidential new construction market. The Company's sales have also
been impacted from time to time by unseasonable and excessive weather conditions
that delay new construction. There can be no assurance that such conditions will
not have a material adverse effect on the Company's operating results in the
future.

    COMPETITION.  The Company faces competition from a number of national and 
regional competitors, both in the armored cable and pipe and wire industries, 
some of which have greater financial, engineering, research and development, 
manufacturing and other resources than the Company. The Company's competitors 
can be expected to continue to improve the design and performance of their 
products and to introduce new products with competitive price and performance 
characteristics. Although the Company believes that it has certain 
technological and other advantages over its competitors, maintaining and 
leveraging any such advantages will require continued investment by the 
Company in design and engineering, development, marketing and customer 
service and support. There can be no assurance that the Company will have 
sufficient resources to continue to make such investments or that the Company 
will be successful in maintaining and leveraging any such advantages. See 
"--Management of Growth" and "Business--Competition." 

                                       22

<PAGE>



    RELIANCE ON INDEPENDENT SALES REPRESENTATIVES AND NONEXCLUSIVE
DISTRIBUTORS.  The Company sells its products to distributors through a network
of approximately 150 independent sales representatives who generally work on a
commission basis. The Company's top ten sales representatives accounted for
approximately 50% of sales during 1996. These representatives are not under
direct control of the Company, are not subject to minimum purchase requirements
and are not contractually obligated to carry the Company's product lines
exclusively or for any period of time. Although the Company believes that the
loss of any one representative would not have a material adverse impact on the
Company's business, there can be no assurance that the Company will be able to
maintain its existing relationships with these representatives. In addition, the
distributors which ultimately sell the Company's products could purchase and
distribute products that compete with the Company's products or cease purchasing
the Company's products at any time. There can be no assurance that the
distributors will continue to distribute or recommend the Company's products or
do so successfully.
 
    DEPENDENCE ON KEY MANAGEMENT PERSONNEL.  The Company's long-term success and
its growth strategy depend on its senior management, particularly Ralph R.
Papitto, the Company's Chairman and Chief Executive Officer, Robert R. Wheeler,
the Company's President and Chief Operating Officer, and Raymond H. Keller, the
Company's Chief Financial Officer. The loss of service of one or more of the
Company's key senior management personnel could have an adverse effect on the
Company's business, financial condition and results of operations. See
"Executive Officers of the Registrant."
 
    ANTITAKEOVER PROVISIONS.  Certain provisions of the Company's Restated
Certificate of Incorporation, as amended, and By-Laws and of the Delaware
General Corporation Law (the "DGCL") could discourage potential acquisition
proposals and could delay or prevent a change in control of the Company. Such
provisions, which include supermajority voting requirements for specified
business combinations, a staggered Board of Directors, and the right of the
Board of Directors, without further stockholder approval, to issue preferred
stock (the "Preferred Stock") upon such terms and conditions, and having such
rights, privileges and preferences as the Board of Directors may determine, may
have the effect of deferring hostile takeovers or delaying or preventing changes
in control or management of the Company. The rights of the holders of Common
Stock will be subject to, and may be adversely affected by, the rights of any
holders of Preferred Stock that may be issued in the future. The Company has no
present plans to issue any Preferred Stock. 

                                       23

<PAGE>

              ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 
<TABLE>
<CAPTION>
                                      CONTENTS

Audited Consolidated Financial Statements

<S>                                                                                   <C>

Consolidated Balance Sheets.........................................................           25
Consolidated Statements of Income...................................................           27
Consolidated Statements of Shareholders' Equity.....................................           28
Consolidated Statements of Cash Flows...............................................           29
Notes to Consolidated Financial Statements..........................................           31
Report of Independent Auditors......................................................           45
</TABLE>
 
                                       24
<PAGE>

CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                              DECEMBER 31
                                                                          --------------------
                                                                            1996       1995
                                                                          ---------  ---------
                                                                              (IN THOUSANDS)
<S>                                                                       <C>        <C>
Assets
Current assets:
 Cash and cash equivalents (Note 3)......................................  $    980   $  2,090
 Marketable securities (Note 3)..........................................    30,508     25,524
 Accounts receivable, net of allowance for doubtful accounts and sales
   allowances of $3,140 in 1996 and $2,365 in 1995.......................    23,919     20,575
 Inventories:
  Finished goods.........................................................    11,559     10,162
  Work-in-process........................................................     3,702      1,332
  Raw materials..........................................................     5,665      7,868
                                                                           --------   --------
                                                                             20,926     19,362
Current deferred taxes (Note 9)..........................................       637        635
Other current assets.....................................................     1,121      1,015
                                                                           --------   --------
Total current assets.....................................................    78,091     69,201

Property, plant and equipment:
 Land....................................................................       510        510
 Buildings and improvements..............................................     8,754      4,972
 Machinery and equipment.................................................    16,050     13,571
 Furniture and fixtures..................................................     1,791      1,390
 Construction in progress................................................        83         --
                                                                           --------   --------
                                                                             27,188     20,443
 Less accumulated depreciation...........................................     9,482      7,331
                                                                           --------   --------
Net property, plant and equipment.......................................     17,706     13,112

Other long-term assets, net.............................................      2,126      2,471
                                                                           --------   --------
Total assets............................................................  $  97,923  $  84,784
                                                                           --------   --------
                                                                           --------   --------
</TABLE>
 
                                       25
<PAGE>
    Consolidated Balance Sheets (continued)

<TABLE>
<CAPTION>
                                                                              DECEMBER 31
                                                                          --------------------
                                                                            1996       1995
                                                                          ---------  ---------
                                                                              (IN THOUSANDS)
<S>                                                                       <C>        <C>
Liabilities and shareholders' equity
Current liabilities:
 Current portion of long-term debt......................................  $     270  $      --
 Revolving credit note payable (Note 4).................................      2,000      6,925
 Accounts payable.......................................................     12,471     11,840
 Accrued expenses:
  Payroll and employee benefits.........................................      2,506      1,426
  Other.................................................................      1,885        911
                                                                           --------   --------
Total accrued expenses..................................................      4,391      2,337
                                                                           --------   --------
Total current liabilities...............................................     19,132     21,102

Long-term debt (Note 4).................................................      3,300         --

Deferred income taxes (Note 9)..........................................      1,547      1,571

Other long-term liabilities.............................................        954        800

Commitments and contingencies (Notes 6 and 7)...........................         --         --

Shareholders' equity (Note 8):
 Preferred stock, $.01 par value, 1,000,000 shares authorized, none
   issued...............................................................         --         --
 Common stock, $.01 par value, 15,000,000 shares authorized, 7,335,025
   and 7,333,750 shares issued and outstanding in 1996 and 1995,
   respectively.........................................................         73         73
 Paid-in capital........................................................     48,011     47,918
 Other..................................................................        218         40
 Treasury stock, 4,825 and 2,488 shares in 1996 and 1995, respectively,
   at cost..............................................................        (82)       (30)
 Retained earnings......................................................     24,770     13,310
                                                                           --------   --------
Total shareholders' equity..............................................     72,990     61,311
                                                                           --------   --------
Total liabilities and shareholders' equity..............................  $  97,923  $  84,784
                                                                           --------   --------
                                                                           --------   --------
</TABLE>
 
    See accompanying notes.
 
                                       26
<PAGE>
CONSOLIDATED STATEMENTS OF INCOME
 
<TABLE>
<CAPTION>
                                                                                   YEARS ENDED DECEMBER 31
                                                                             ----------------------------------
                                                                                1996        1995        1994
                                                                             ----------  ----------   ---------
                                                                           (IN THOUSANDS, EXCEPT PER SHARE DATA)
<S>                                                                          <C>         <C>         <C>
Net sales..................................................................  $  161,868  $  139,483  $  114,386
Cost of goods sold.........................................................     118,487     107,087      82,497
                                                                              ---------    --------    --------
Gross profit...............................................................      43,381      32,396      31,889

Selling, general and administrative expenses...............................      26,384      21,926      21,491
                                                                              ---------    --------    --------
Income from operations.....................................................      16,997      10,470      10,398

Other income (expense):
 Interest expense..........................................................        (728)       (614)       (176)
 Investment income.........................................................       2,339       3,001          80
 Other, net................................................................         (48)         39         160
                                                                              ---------    --------    --------
                                                                                  1,563       2,426          64
                                                                              ---------    --------    --------
Income before income taxes.................................................      18,560      12,896      10,462
Income taxes (Note 9)......................................................       7,100       4,791       4,269
                                                                              ---------    --------    --------
Net income.................................................................  $   11,460  $    8,105  $    6,193
                                                                              ---------    --------    --------
                                                                              ---------    --------    --------
Earnings per common share..................................................  $     1.54  $     1.12  $     1.12
                                                                              ---------    --------    --------
                                                                              ---------    --------    --------
 Average shares outstanding and common stock equivalents...................   7,421,179   7,234,075   5,527,078
                                                                              ---------    --------    --------
                                                                              ---------    --------    --------
</TABLE>
 
    See accompanying notes.
 
                                       27
<PAGE>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>                                                                     RETAINED
                                                                              EARNINGS
                        COMMON        PAID-IN                    TREASURY   (ACCUMULATED
                         STOCK        CAPITAL        OTHER        STOCK       DEFICIT)        TOTAL
                       ----------   ----------    ----------   ----------  -------------   ----------
<S>                    <C>           <C>          <C>          <C>          <C>             <C>
                                                               (IN THOUSANDS)
Balance at           
  December 31,       
  1993...........       $  52         $22,734       $  --         $ --         $ (988)      $  21,798
Net income for                                                                                         
  1994...........         --             --            --           --          6,193           6,193  
Proceeds from                                                                                          
  issuance of                                                                                          
  219,250 shares                                                                                       
  of common                                                                                            
  stock..........           2           2,039          --           --            --            2,041  
Grant of                                                                                               
  restricted                                                                                           
  stock (Note                                                                                          
  8).............           1             869         (670)         --            --              200  
Issuance of                                                                                            
  15,000 shares                                                                                        
  of common stock                                                                                      
  in connection                                                                                        
  with Kaf-Tech                                                                                        
  purchase.......          --             200          --           --            --              200  
Adjustment to                                                                                          
  unrealized                                                                                           
  gains (losses)                                                                                       
  on available-                                                                                        
  for-sale                                                                                             
  securities, net                                                                                      
  of tax.........          --              --          (74)          --            --             (74) 
Other............          --              29           --           --            --              29  
                       ----------   ----------    ----------   ----------  -------------   ----------
Balance at                                                                                             
  December 31,                                                                                         
  1994...........          55          25,871         (744)          --          5,205         30,387  

Net income for                                                                                         
  1995...........          --             --            --           --          8,105          8,105  
Proceeds from                                                                                          
  issuance of                                                                                          
  1,762,500                                                                                            
  shares of                                                                                            
  common stock...          18          21,906           --           --            --          21,924  
Repurchase of                                                                                          
  restricted                                                                                           
  stock, net.....          --             --            --          (30)           --             (30) 
Amortization of
  compensation
  (Note 8).......          --             --           191            --           --             191  
Exercise of stock                                                                        
  options (Note                                                                          
  8).............          --             140          --             --           --             140  
Adjustment to                                                                                
  unrealized                                                                                                 
  gains (losses)                                                                                             
  on available-                                                                                              
  for-sale                                                                                                   
  securities, net                                                                                            
  of tax.........          --              --           593           --            --            593  
Other............          --               1           --            --            --              1  
                       ----------   ----------    ----------   ----------  -------------   ----------
Balance at
  December 31,               
  1995...........          73          47,918            40          (30)       13,310         61,311  

Net income for                                                                        
  1996...........          --              --           --            --        11,460         11,460
Repurchase of                                                                
  restricted                                                                          
  stock, net.....          --              --           --           (52)           --            (52)
Amortization of                                                                                              
  compensation                                                                                  
  (Note 8).......          --              --           189           --            --            189
Cancellation of                                                                                              
  25,900                                                                                                     
  restricted                                               
  shares.........          --            (276)           276          --            --              -- 
Exercise of stock                                                                                            
  options and                                                                                   
  related tax                                                                                     
  benefit (Note                                                                                          
  8).............          --             369            --           --             --           369          
Adjustment to                                                                               
  unrealized                                                                                 
  gains (losses)                                                                             
  on available-                                                                               
  for-sale                                                                                     
  securities, net                                                                 
  of tax.........          --              --          (287)          --             --          (287) 
                       ----------   ----------    ----------   ----------  -------------   ----------
Balance at
  December 31, 
  1996...........        $73         $ 48,011        $  218      $ (82)        $24,770        $ 72,990 
                       ----------   ----------    ----------   ----------  -------------   ----------
                       ----------   ----------    ----------   ----------  -------------   ----------

</TABLE>
 
    See accompanying notes.

                                    28

<PAGE>
 
CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                         YEARS ENDED DECEMBER 31
                                                                                     -------------------------------
                                                                                       1996       1995       1994
                                                                                     ---------  ---------  ---------
 <S>                                                                                  <C>        <C>        <C>
                                                                                         (IN THOUSANDS)
Operating activities
Net income.........................................................................  $  11,460  $   8,105  $   6,193
Adjustments to reconcile net income to net cash provided by operating activities:
 Depreciation......................................................................      2,235      1,860      1,450
 Amortization of intangibles.......................................................        776        195         22
 Net gain on sale of property, plant and equipment.................................        (54)        --         --
 Net gain realized on available-for-sale securities................................       (618)    (1,720)        --
 Deferred income taxes.............................................................         77         12       (363)
 Provision for bad debts...........................................................        263         76        173
 Provision for sales allowances....................................................        719        480        330
 Compensation expense for restricted stock and compensatory options................        239        292        200
 Increase (decrease) in cash arising from changes in assets and liabilities:
  Accounts receivable..............................................................     (4,326)    (2,694)    (4,642)
  Inventories......................................................................     (1,564)    (6,732)    (3,483)
  Other current assets.............................................................       (106)      (289)      (625)
  Other long-term assets...........................................................       (431)      (996)        -- 
  Accounts payable.................................................................        631        899      4,344
  Accrued payroll and employee benefits............................................      1,030        (80)       552
  Other accrued liabilities........................................................        974       (703)       247
  Long-term liabilities............................................................        154         --         --
                                                                                     ---------     -------    --------
Net cash provided by (used in) operating activities................................     11,459     (1,295)     4,398

Investing activities
Purchase of Kaf-Tech, including expenses (Note 2)..................................         --         --     (4,840)
Capital expenditures...............................................................     (6,970)    (2,340)    (3,589)
Proceeds from sale of property, plant and equipment................................        195         --         --
Purchase of available-for-sale securities..........................................    (29,063)   (44,907)      (584)
Proceeds from sale of available-for-sale securities................................     24,349     22,601         --
Purchase of patents, intangibles and other.........................................         --         --        (91)
                                                                                     ---------     -------    --------
Net cash used in investing activities..............................................    (11,489)   (24,646)    (9,104)
</TABLE>

                                      29
<PAGE>
    Consolidated Statements of Cash Flows (continued)

<TABLE>
<CAPTION>
                                                                                        YEARS ENDED DECEMBER 31
                                                                                    -------------------------------
                                                                                      1996       1995       1994
                                                                                    ---------  ---------  ---------
                                                                                              (IN THOUSANDS)
<S>                                                                                 <C>        <C>        <C>
Financing activities
Proceeds from revolving line of credit borrowings.................................     60,615     52,948     49,585
Repayments of revolving line of credit borrowings.................................    (65,540)   (49,523)   (47,335)
Proceeds from term loan...........................................................      3,200         --         --
Repayment of term loan............................................................     (3,200)        --         --
Proceeds from long-term debt......................................................      3,570         --         --
Proceeds from issuance of common stock............................................        327     22,065      2,041
Purchase of treasury stock........................................................        (52)       (30)        --
                                                                                     ---------     -------    --------
Net cash provided by (used in) financing activities...............................     (1,080)    25,460      4,291
                                                                                     ---------     -------    --------
Net decrease in cash and cash equivalents.........................................     (1,110)      (481)      (415)
Cash and cash equivalents at beginning of year....................................      2,090      2,571      2,986
                                                                                     ---------     -------    --------
Cash and cash equivalents at end of year..........................................  $     980  $   2,090  $   2,571
                                                                                     ---------     -------    --------
                                                                                     ---------     -------    --------
Supplemental schedule of cash flow information:
  Cash paid during the year for interest..........................................  $     814  $     614  $     157
                                                                                     ---------     -------    --------
                                                                                     ---------     -------    --------
  Cash paid during the year for income taxes......................................  $   6,058  $   5,863  $   4,500
                                                                                     ---------     -------    --------
                                                                                     ---------     -------    --------
</TABLE>

      See accompanying notes.

                                    30


<PAGE>
                      NOTES TO FINANCIAL STATEMENTS 
                       DECEMBER 31, 1996 AND 1995

 
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
BUSINESS
 
    AFC Cable Systems, Inc. (the Company) is a manufacturer of electrical
distribution products, including prewired armored cable, flexible conduit and
modular wiring systems used in the nonresidential construction electrical wiring
industry. The Company's customers primarily consist of electrical supply
wholesalers located throughout the United States. The Company performs credit
evaluations on all new customers and generally does not require collateral.
Credit losses are provided for in the financial statements and consistently have
been within management's expectations.
 
CONSOLIDATION
 
    The accompanying consolidated financial statements include the accounts of
the Company and its wholly-owned subsidiaries. All intercompany balances and
transactions have been eliminated.
 
CASH EQUIVALENTS
 
    Cash equivalents are defined as all short-term, highly-liquid investments
with an original maturity of three months or less.
 
MARKETABLE SECURITIES
 
    Management determines the appropriate classification of marketable
securities at the time of purchase and reevaluates such designation as of each
balance sheet date. All debt and equity securities have been classified as
available-for-sale.

    Available-for-sale securities are carried at fair value based on quoted
market prices, with the unrealized gains and losses, net of tax, reported in a
separate component of shareholders' equity. The amortized cost of debt
securities in this category is adjusted for amortization of premiums and
accretion of discounts to maturity. Such amortization is included in investment
income. Realized gains and losses and declines in value judged to be
other-than-temporary on available-for-sale securities are included in investment
income. The cost of securities sold is based on the specific identification
method. Interest and dividends on securities classified as available-for-sale
are included in investment income.
 
                                       31
<PAGE>
 
    1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
INVENTORIES
 
    Inventories are stated at the lower of cost or market. Cost is determined on
a first-in, first-out (FIFO) basis.
 
PROPERTY, PLANT AND EQUIPMENT AND DEPRECIATION
 
    Property, plant and equipment are stated at cost. Depreciation is computed
on the straight-line method over the estimated lives of the assets as follows:
 
        Buildings and improvements            5 to 30 years 
        Machinery and equipment               3 to 10 years 
        Furniture and fixtures                5 to 10 years
 
INTANGIBLE ASSETS
 
    Intangible assets consist primarily of the excess cost over the fair value
of assets acquired in the purchase of Kaf-Tech, Inc. (see Note 3). Intangible
assets are being amortized using the straight-line method over periods of four
to forty years.
 
SELF-INSURANCE
 
    The Company is self-insured for its employee health and workers'
compensation plans. The plans, which are administered by insurance companies,
contain certain stop loss provisions that limit the Company's liability in the
event of catastrophic losses. Claims are accrued for as incurred based on
available claim information and management's estimate of claims incurred but not
yet reported.
 
SALES RECOGNITION
 
    The Company recognizes sales when goods are shipped to the customer.
 
EARNINGS PER SHARE
 
    Earnings per share are based upon the weighted average number of common
shares and common equivalent shares outstanding during the year. Common
equivalent shares result from the assumed exercise of outstanding stock options
and warrants that have a dilutive effect when applying the treasury stock
method.
 
 
                                       32
<PAGE>

    1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
STOCK COMPENSATION
 
    The Company accounts for its stock compensation arrangements under the
provisions of APB 25, "Accounting for Stock Issued to Employees."
 
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
 
    In October 1996, the Accounting Standards Executive Committee issued
Statement of Position (SOP) 96-1, "Environmental Remediation Liabilities." The
overall objective of the SOP is to improve and narrow the way existing
accounting guidance is applied to the recognition of the costs of environmental
remediation, including the clean-up of superfund sites. The new rules are
effective for fiscal years beginning after December 15, 1996, and are not
expected to have a material impact on the Company upon implementation in 1997.
 
USE OF ESTIMATES
 
    The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
 
ADVERTISING COSTS
 
    Advertising costs are expensed as incurred and were $950,000, $854,000 and
$722,000 in 1996, 1995 and 1994, respectively.
 
RECLASSIFICATION
 
    Certain reclassifications were made to the 1995 and 1994 financial
statements in order that they may be consistent with the 1996 presentation.

                                    33

<PAGE>
 
2. ACQUISITION
 
    On September 30, 1994, the Company acquired certain assets constituting the
business of Florida-based Kaf-Tech, Inc., a manufacturer and distributor of
electrical conduit and armored cables. The assets acquired consist of
inventories, receivables, machinery, tooling, and intangible assets. The
purchase price of approximately $4.9 million consisted of cash of $4.7 million
and 15,000 shares of the Common Stock of the Company.
 
    The pro forma statements of income assuming the assets of Kaf-Tech had been
acquired at the beginning of 1994, are as follows:
 
<TABLE>
<CAPTION>
                                                                                YEAR ENDED
                                                                             DECEMBER 31 1994
                                                                            -----------------
                                                                              (IN THOUSANDS)
<S>                                                                          <C>
Net sales..................................................................     $   121,052
Cost of goods sold.........................................................          87,512
                                                                              --------------
Gross profit...............................................................          33,540

Selling, general and administrative expenses...............................          22,731
                                                                              --------------
Income from operations.....................................................          10,809

Other income (expense):
 Interest expense..........................................................            (353)
 Interest income...........................................................              80
 Other, net................................................................             175
                                                                              --------------
Income before income taxes.................................................          10,711

Income taxes...............................................................           4,371
                                                                              --------------
Net income.................................................................     $     6,340
                                                                              --------------
                                                                              --------------
Earnings per common share..................................................     $      1.14
                                                                              --------------
                                                                              --------------
Average shares outstanding and common stock equivalents (1)................       5,538,328
                                                                              --------------
                                                                              --------------
</TABLE>
 
------------------------
 
(1) Adjusted for issuance of 15,000 shares of the Company included in purchase
    price.
 
    The above pro forma information does not purport to represent the Company's
results of operations that would have been attained had the acquisition of the
Kaf-Tech assets in fact occurred at the beginning of the period indicated or to
project the Company's results for any future periods.
 
                                       34
<PAGE>

3. MARKETABLE SECURITIES
 
    The Following is a Summary of securities Held by the Company.  All
securities are classified as available-for-sale.
 
<TABLE>
<CAPTION>                                        GROSS         GROSS
                                               UNREALIZED    UNREALIZED     ESTIMATED 
                                     COST        GAINS         LOSSES      FAIR VALUE
                                   ---------  ------------   -----------  ------------
<S>                                <C>        <C>            <C>          <C>
                                                     (IN THOUSANDS)
December 31, 1996

U.S. corporate debt securities...  $ 1,509     $   92         $  --        $  1,601
U.S. Treasury securities and
  obligations of U.S. Government
  agencies.......................   26,193         52            (6)         26,239
Equity securities................    2,576        168           (76)          2,668
                                   --------    ------         -------      ---------
Total included in investments....  $30,278     $  312          $(82)       $ 30,508
                                   --------    ------         -------      ---------
                                   --------    ------         -------      ---------

December 31, 1995

Mutual funds included in cash
  equivalents.................... $   3,351     $ --           $(184)      $ 3,167
                                  =========     =====          ======      =======
U.S. corporate debt securities... $   4,456     $ 161          $  --       $ 4,617
U.S. Treasury securities and
  obligations of U.S. Government
  agencies.......................     8,123        90             --         8,213
Equity securities................    12,133       561             --        12,694
                                   --------    ------         -------      ---------
Total included in investments.... $  24,712     $ 812           $ --       $25,524
                                   --------    ------         -------      ---------
                                   --------    ------         -------      ---------
</TABLE>
 
    U.S. corporate debt securities mature within the year and U.S. Treasury
securities generally mature within the year. Expected maturities will differ
from contractual maturities because the issuers of the securities may have the
right to prepay obligations without prepayment penalties. Realized gains and
(losses) included in investment income amounted to $859,000 and $(241,000) in
1996 and $1,720,000 in 1995.

                                    35

<PAGE>
 
4. SHORT AND LONG-TERM DEBT
 
REVOLVING CREDIT NOTE PAYABLE
 
    During 1996, the Company entered into an unsecured revolving line of credit
agreement which provides for direct borrowings of up to $25,000,000 of which up
to $10,000,000 is available, without the lender's prior consent, for business
acquisitions. The line of credit agreement provides for letter of credit
borrowings of up to $3,000,000, of which $816,000 is outstanding at December 31,
1996. A monthly fee based on the unused portion of credit is payable under the
agreement.
 
    Borrowings under the line of credit are available at interest rates equal to
either the lender's base rate or the Eurodollar rate plus one half of one
percent to one and one quarter of one percent for a fixed period of one, two,
three or six months. The Company has the option of electing the applicable rate
upon notification to the lender and as a result, portions of the outstanding
balance accrue interest at different rates. The weighted average rate of
outstanding short-term borrowing is 6.3% at December 31, 1996. The carrying
value of the line of credit approximates fair value.

    The line of credit contains certain restrictive covenants, which require
that the Company maintain minimum levels of tangible capital funds and meet
other specified ratio requirements.
 
LONG-TERM DEBT
 
    During 1996, the Company received the proceeds from the issuance of $3.57
million in Industrial Revenue Bonds ("IRBs") through the Massachusetts
Industrial Finance Agency for the purpose of acquiring and refurbishing a 99,000
square-foot manufacturing facility in New Bedford, Massachusetts, which secures
the IRBs. The IRBs mature on July 24, 2016, and carry an average interest rate
of approximately 3.5% adjustable on a weekly basis. Additionally, an annual fee
of 1.0% on the letter of credit securing the bonds ($3.6 million at December 31,
1996) will be paid to the bank acting as a trustee in the issuance of the bonds.
The Company has the right to convert from the weekly interest rate to a fixed
rate established at the time of conversion. The bonds are payable in 19 annual
installments of $180,000 with a final payment of $150,000 due at maturity funded
through monthly payments of $15,000 to the trustee over the twelve months
preceding the installment due dates. At December 31, 1996, $3.3 million of the
total was classified as long-term debt. The carrying value of the bonds
approximates market at December 31, 1996.
 
                                       36
<PAGE>

5. EMPLOYEE BENEFIT PLANS
 
The Company sponsors a Supplemental Executive Retirement Plan ("the Plan") 
for senior management. The Plan is a defined contribution plan whereby 
participant accounts are credited in an amount equal to a percent, determined 
by the Company, of each participant's compensation plus the participant's 
allocable share of net earnings of the Plan. At December 31, 1996, the 
Company has assets (market value of $900,000), segregated in a trust, 
available to meet the obligations of the Plan. Expenses for this plan were 
approximately $276,000, $190,000, and $400,000, for the years ended December 
31, 1996, 1995, and 1994, respectively. The total liability under the plan at 
December 31, 1996, is approximately $976,000.

The Company also has five defined contribution (401(k)) plans covering 
substantially all employees. Contributions to the plans are based on a 
percentage of the employee's compensation. The Company also participates in a 
multi-employer defined contribution plan covering certain union employees. 
The Company's expense under the 401(k) and multi-employer plans was 
approximately $449,000, $437,000, and $336,000 for the years ended December 
31, 1996, 1995, and 1994, respectively.
 
6. COMMITMENTS
 
The Company has various operating lease agreements for buildings and 
equipment extending through December 2006. The following is a schedule of the 
future minimum rental payments due under these leases:
 
                                  (IN THOUSANDS)

1997                                $   2,758
1998                                    2,222
1999                                    1,587
2000                                    1,357
2001                                    1,236
                                    ---------
Thereafter                              3,339
                                    ---------
                                    $  12,499
                                    ---------
                                    ---------

                                               37

<PAGE>

6. COMMITMENTS (continued)

Rent expense amounted to $3,738,390, $3,088,056, and $1,543,000, in 1996, 
1995, and 1994, respectively.
 
In the normal course of business, the Company enters into purchase agreements 
with certain raw material vendors. At December 31, 1996, the Company has 
agreed to purchase approximately 100% of the 1997 copper usage from two 
vendors.
 
7. CONTINGENCIES
 
The Company is a defendant in certain claims that relate to matters that 
occurred prior to the present ownership. In accordance with the purchase and 
sale agreement of the Company, the prior owner has indemnified the Company 
for such claims and, accordingly, the matters are being defended by the prior 
owners and its insurance companies. Management is of the opinion that these 
claims relate to the prior owners and therefore will not have a material 
adverse effect on the Company's financial position or results of operations.
 
Additionally, the Company is a party to one environmental matter and certain 
other legal proceedings not covered by the indemnification. In the 
environmental matter, a number of responsible parties entered into a consent 
decree with the EPA in 1991 and subsequently, such parties as plaintiffs have 
sought contribution from the Company, which was not named as a responsible 
party by the EPA. The Company has admitted that a predecessor of the business 
currently operated by the Company had disposed of a de minimus amount of 
waste at the site. On December 17, 1996, the U.S. District Court for the 
district of Massachusetts entered a judgment in favor of the Company with 
respect to this claim. The time during which the Plaintiffs may file an 
appeal has not yet lapsed.
 
                                    38

<PAGE>

8. SHAREHOLDERS' EQUITY AND STOCK AWARD PLANS


On February 9, 1995, the Company completed the issuance of 1,500,000 shares 
of Common Stock at a price of $13.50 per share. As part of this offering, the 
Company granted the underwriters an option to purchase a maximum of 262,500 
additional shares to cover over-allotments, which was exercised on February 
9, 1995.
 
The Company has an Equity Incentive Plan under which the Company may grant 
stock options, stock appreciation rights, restricted stock and unrestricted 
stock awards, deferred stock awards and performance awards to key employees. 
The Company has reserved a total of 400,000 shares for issuance under this 
plan.
 
Additionally, directors who are not employees of the Company may be awarded 
options for shares of Common Stock under the Directors' Stock Option Plan. A 
total of 100,000 shares of Common Stock have been reserved for issuance under 
the Directors' Plan.
 
The options, under both plans, generally vest in equal installments over the 
five years subsequent to the date of grant, with the exception of 50,000 
options granted in 1996 and 30,000 options granted in 1995 which vest over 
four years. The options expire ten years after the date of grant.
 
The Company has adopted the disclosure-only provisions of Statement of 
Financial Accounting Standards No. 123 (FAS No. 123), "Accounting for 
Stock-Based Compensation." Accordingly, compensation cost has been recognized 
in the financial statements only for stock options that are compensatory as 
defined under APB 25. Had compensation cost for the Company's two stock 
option plans been determined based on the fair value at the grant date for 
awards in 1996 and 1995 consistent with the provisions of FAS No. 123, the 
Company's net earnings and earnings per share would have been the pro forma 
amounts indicated below.
 
                                               1996       1995
                                            ---------  ---------

Net income, as reported.................... $  11,460  $   8,105
Net income, pro forma......................    11,383      8,093
Earnings per common share, as reported..... $    1.54  $    1.12
Earnings per common share, pro forma.......      1.54       1.12

                                   39

<PAGE>

8. SHAREHOLDERS' EQUITY AND STOCK AWARD PLANS (continued)

The fair value of the options was estimated at the date of grant using a 
Black-Scholes option pricing model. For 1995 and 1996, option grants with an 
expected life of four years, the following assumptions were used: risk-free 
interest rate of 5.8%; dividend yield of 0%; and a volatility factor of the 
expected market price of the Company's Common Stock of .40. For 1995 and 1996 
option grants with an expected life of five years, the following assumptions 
were used: risk-free interest rate of 5.9%; dividend yield of 0%; and 
expected volatility of .40.

The effects on pro forma net income and earnings per share of expensing the 
estimated fair value of stock options are not necessarily representative of 
the effects on reported net income for future years due to such things as the 
vesting period of the stock options and the potential for issuance of 
additional stock options in future years. Additionally, because FAS No. 123 
is applicable only to options granted subsequent to December 31, 1994, its 
pro forma effect will not be fully reflected until 1998.
 
A summary of the status of the Company's Plan at year-end 1996, 1995 and 
1994, and changes during the years ended on those dates is presented below:
 
<TABLE>
<CAPTION>
                                                                    1996                    1995                    1994
                                                           ----------------------  ----------------------  ----------------------
                                                                       WEIGHTED                WEIGHTED                WEIGHTED
                                                                        AVERAGE                 AVERAGE                 AVERAGE
                                                                       EXERCISE                EXERCISE                EXERCISE
FIXED OPTIONS                                               SHARES       PRICE      SHARES       PRICE      SHARES       PRICE
---------------------------------------------------------  ---------  -----------  ---------  -----------  ---------  -----------
<S>                                                        <C>        <C>          <C>        <C>          <C>        <C>

Outstanding at beginning of year.........................    296,000   $   10.52     265,000   $    9.98     200,000   $   10.00
Granted..................................................     80,000       13.50      45,000       13.50      95,000        9.95
Exercised................................................    (32,000)      10.25     (14,000)      10.00          --          --
Canceled.................................................    (24,000)      10.50          --          --     (30,000)      10.00
                                                            ---------  ---------    ---------  ---------    --------   ---------
Outstanding at end of year...............................    320,000   $   11.29     296,000   $   10.52     265,000   $    9.98
                                                            ---------  ---------    ---------  ---------    --------   ---------
                                                            ---------  ---------    ---------  ---------    --------   ---------
Options exercisable at year end..........................    102,500   $   10.24      73,000   $    9.99
                                                            ---------  ---------    ---------  ---------
                                                            ---------  ---------    ---------  ---------

Weighted-average fair value of options granted during
  year...................................................  $    5.59                $    5.58
                                                            ---------               ---------
                                                            ---------               ---------

</TABLE>

                                    40

<PAGE>
 
    The range of exercise prices at December 31, 1996, is from $7 to $16.50 and
the weighted average remaining contractual life in years of outstanding options
is 8.0.
 
    Shares of capital stock reserved for possible future issuance are as
follows:
 
<TABLE>
<CAPTION>
                                                                              DECEMBER 31
                                                                          --------------------
<S>                                                                       <C>        <C>
                                                                            1996       1995
                                                                          ---------  ---------
Options granted.........................................................    320,000    296,000
Options as yet ungranted................................................     86,900    117,000
Qualified employee savings plans........................................    500,000    500,000
                                                                          ---------  ---------
                                                                            906,900    913,000
                                                                          ---------  ---------
                                                                          ---------  ---------
</TABLE>
 
During 1994, the Company granted 73,000 shares of restricted common stock to 
certain employees at par value. The employees vest in the restricted common 
stock ratably over periods of two to four years. The difference between the 
par value and the fair market value of shares of stock on the date of grant 
was considered compensation and will be amortized ratably over the vesting 
period. During 1996 and 1995, the restrictions lapsed on 22,600 and 23,500 
shares, respectively. In 1996, 25,900 forfeited restricted shares were 
repurchased by the Company at par value. The Company purchased 2,337 and 
2,488 shares of vested restricted stock during 1996 and 1995, respectively, 
from certain employees, at fair market value, to provide them with the funds 
necessary to pay federal and state income taxes on the receipt of the vested 
shares.
 
9. INCOME TAXES
 
Deferred income taxes are recognized for the expected consequences of 
temporary differences by applying enacted statutory rates, applicable to 
future years, to differences between the financial reporting basis and tax 
basis of assets and liabilities.

                                             41


<PAGE>

9. INCOME TAXES (continued)

The principal reasons that the aggregate income tax provisions differ from
the U.S. statutory rate of 34% for the years ended December 31, 1996 and 1995,
are as follows:
 
<TABLE>
<CAPTION>
                                                                                           1996                  1995
                                                                                 ----------------------  ---------------------
                                                                                   (000s)                  (000s)
<S>                                                                              <C>             <C>       <C>          <C>
Income tax provision at statutory rate.........................................  $   6,310        34.0%     $4,385       34.0%
State taxes, net of federal benefit............................................        666         3.6%        380        3.0%
Other..........................................................................        124          .7%         26         .2%
                                                                                 ---------         ---   ---------        ---
                                                                                 $   7,100        38.3%  $   4,791       37.2%
                                                                                 ---------         ---   ---------        ---
                                                                                 ---------         ---   ---------        ---
</TABLE>
 
The components of the provision for income taxes for the years ended December 
31, 1996 and 1995, are as follows:
 
<TABLE>
<CAPTION>
                                                                               1996       1995
                                                                             ---------  ---------
                                                                                    (000s)
<S>                                                                          <C>        <C>
Current:
  Federal..................................................................  $   6,018  $   4,154
  State....................................................................      1,005        625
                                                                             ---------  ---------
Total current..............................................................      7,023      4,779

Deferred:
  Federal..................................................................         58         53
  State....................................................................         19        (41)
                                                                             ---------  ---------
Total deferred.............................................................         77         12
                                                                             ---------  ---------
Total......................................................................  $   7,100  $   4,791
                                                                             ---------  ---------
                                                                             ---------  ---------
</TABLE>
 
A summary of the significant components of the Company's deferred tax 
liabilities and assets as of December 31, 1996 and 1995, follows:
 
<TABLE>
<CAPTION>
                                                                               1996       1995
                                                                             ---------  ---------
                                                                                    (000s)
<S>                                                                          <C>        <C>
Deferred tax liabilities:
  Fixed assets.............................................................  $   1,857  $   1,766
  Marketable securities....................................................        134        237
                                                                              --------   --------
Total deferred tax liabilities.............................................      1,991      2,003
</TABLE>

                                   42

<PAGE>
<TABLE>
<CAPTION>
                                                                               1996       1995
                                                                             ---------  ---------
                                                                                    (000s)
<S>                                                                            <C>        <C>
Deferred tax assets:
  Supplemental executive retirement plan.....................................      389        416
  Goodwill...................................................................       13         --
  Stock compensation.........................................................       19         40
  Inventory..................................................................      315        195
  Allowance for doubtful accounts............................................      142        129
  Accrued liabilities........................................................      203        287
                                                                              ---------------------
Total deferred tax assets..................................................      1,081      1,067
                                                                              ---------------------
Net deferred tax liabilities...............................................    $   910    $   936
                                                                              ---------------------
                                                                              ---------------------
</TABLE>
 
10. SUBSEQUENT EVENT
 
On January 28, 1997, the Company acquired all of the outstanding stock of 
Illinois-based B&B Electronics Manufacturing Company, a manufacturer and 
distributor of electronic interfaces and connectors that facilitate data 
communications. The purchase price consisted of $4.2 million in cash and 
60,000 shares of Common Stock. On January 31, 1997, the Company acquired 
certain assets and assumed certain liabilities of New Jersey-based Area 
Lighting Research, Inc., a designer, manufacturer and distributor of photo 
controls and electrical devices for lighting control and fixture industries. 
Assets acquired include inventories, receivables, equipment, tooling, patents 
and other intangible assets. The purchase price, funded from the liquidation 
of marketable securities, was $7.7 million (plus $.9 million of assumed 
liabilities). In both instances, additional consideration will be paid by the 
Company if certain financial targets are achieved by the acquired companies.

                                    43


<PAGE>


11. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
 
The following is a summary of the unaudited quarterly results of operations 
for 1996 and 1995 (dollars in thousands, except per share data):
 
<TABLE>
<CAPTION>
                                                                          QUARTER ENDED
                                                          ----------------------------------------------
                                                            MARCH      JUNE      SEPTEMBER    DECEMBER       FULL
                                                             30         29          28           31          YEAR
                                                          ---------  ---------  -----------  -----------  ----------
<S>                                                       <C>        <C>        <C>          <C>          <C>

1996
Net sales...............................................  $  33,885  $  42,218   $  41,559    $  44,206   $  161,868
Income from operations..................................      2,047      4,283       5,259        5,408       16,997
Net income..............................................      1,636      2,904       3,350        3,570       11,460
Earnings per common share...............................       0.22       0.39        0.45         0.48         1.54

</TABLE>
 
<TABLE>
<CAPTION>
                                                                                  QUARTER ENDED
                                                          ----------------------------------------------------------
                                                            APRIL      JULY      SEPTEMBER    DECEMBER       FULL
                                                              1          1          30           31          YEAR
                                                          ---------  ---------  -----------  -----------  ----------
<S>                                                       <C>        <C>        <C>          <C>          <C>

1995
Net sales...............................................  $  33,253  $  33,664   $  36,543    $  36,023   $  139,483
Income from operations..................................      3,055      3,033       2,481        1,901       10,470
Net income..............................................      1,922      2,207       2,227        1,749        8,105
Earnings per common share...............................       0.29       0.30        0.30         0.24         1.12
</TABLE>


                                   44

<PAGE>

                       REPORT OF INDEPENDENT AUDITORS
 
The Board of Directors 
and Shareholders AFC Cable Systems, Inc.
 
We have audited the accompanying consolidated balance sheets of AFC Cable 
Systems, Inc. as of December 31, 1996 and 1995, and the related consolidated 
statements of income, shareholders' equity, and cash flows for each of the 
three years in the period ended December 31, 1996. Our audits also included 
the financial statement schedule listed in the Index at Item 14(a). These 
financial statements and schedule are the responsibility of the Company's 
management. Our responsibility is to express an opinion on these financial 
statements and schedule 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, the consolidated financial statements referred to above 
present fairly, in all material respects, the consolidated financial position 
of AFC Cable Systems, Inc. at December 31, 1996 and 1995, and the 
consolidated results of its operations and its cash flows for each of the 
three years in the period ended December 31, 1996, in conformity with 
generally accepted accounting principles. Also, in our opinion, the related 
financial statement schedule, when considered in relation to the basic 
financial statements taken as a whole, presents fairly in all material 
respects the information set forth therein.
  
                                                      ERNST & YOUNG LLP
 
Providence, Rhode Island 
February 14, 1997
 
                                    45

<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
 
    None.
 
                                    PART III
 
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
 
    Information relating to the current executive officers of the Company is
included in Item 4A of Part I.
 
    Information relating to the Directors of the Company is incorporated herein
by reference to the "Election of Directors" section of the Company's Proxy
Statement to be filed with the Commission in connection with the 1997 Annual
Meeting of Stockholders (the "Proxy Statement").
 
ITEM 11. EXECUTIVE COMPENSATION
 
    Information relating to executive compensation is incorporated herein by 
reference to the "Executive Compensation" section of the Proxy Statement.
 
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
 
    Information relating to security ownership is incorporated herein by 
reference to the "Security Ownership of Certain Beneficial Owners and 
Management" section of the Proxy Statement.
 
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
 
    None.

                                    46

<PAGE>


                                       PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
 
(a) The following documents are filed as part of this report: 

  (1) The following financial statements of AFC Cable Systems, Inc. are 
included in Item 8:
 
      Consolidated Balance Sheets as of December 31, 1996 and 1995
 
      Consolidated Statements of Income for the Years Ended December 31, 1996,
    1995 and 1994
 
      Consolidated Statements of Stockholders' Equity for the Years Ended
    December 31, 1996, 1995 and 1994
 
      Consolidated Statements of Cash Flows for the Years Ended December 31,
    1996, 1995 and 1994
 
      Notes to Consolidated Financial Statements

  (2) The following financial statement schedule of AFC Cable Systems, Inc. 
is included in Item 14(d):
 
Schedule II--Valuation and Qualifying Accounts
 
    All other schedules for which provision is made in the applicable accounting
regulations of the Securities and Exchange Commission are not required under
related instructions or are inapplicable and therefore have been omitted.
 
(b) Reports on Form 8-K
 
    None

(c) Exhibits--The response to this portion of Item 14 is submitted as a
separate section of this report. See Exhibit Index on page 49.

                                    47
<PAGE>
                    ITEM 14(d).  FINANCIAL STATEMENT SCHEDULE
 
<TABLE>
<CAPTION>
                                                                             ADDITIONS
                                               ---------------------------------------------------------------------
                                                                             CHARGED TO
                                               BALANCE AT     CHARGED TO        OTHER                    BALANCE AT
                                                BEGINNING      COSTS AND     ACCOUNTS--   DEDUCTIONS--     END OF
DESCRIPTION                                     OF PERIOD      EXPENSES       DESCRIBE      DESCRIBE       PERIOD
---------------------------------------------  -----------  ---------------  -----------  -------------  -----------
<S>                                            <C>          <C>              <C>          <C>            <C>
                                                                                 (IN
                                                                             THOUSANDS)
Year ended December 31, 1996
  Deducted from asset accounts:
    Allowance for doubtful accounts..........   $     300      $     263                    $     207(1)  $     356
    Reserve for sales allowances.............       2,065          4,148                        3,429(2)      2,784
                                               -----------        ------     -----------       ------    -----------
    Totals...................................   $   2,365      $   4,411                    $   3,636     $   3,140
                                               -----------        ------     -----------       ------    -----------
                                               -----------        ------     -----------       ------    -----------
Year ended December 31, 1995
  Deducted from asset accounts:
    Allowance for doubtful accounts..........   $     316      $      76                    $      92(1)  $     300
    Reserve for sales allowances.............       1,585          3,008                        2,528(3)      2,065
                                               -----------        ------     -----------       ------    -----------
    Totals...................................   $   1,901      $   3,084                    $   2,620     $   2,365
                                               -----------        ------     -----------       ------    -----------
                                               -----------        ------     -----------       ------    -----------
Year ended December 31, 1994
  Deducted from asset accounts:
    Allowance for doubtful accounts..........   $     311      $     173                    $     168(1)  $     316
    Reserve for sales allowances.............       1,260          2,480                        2,155(4)      1,585
                                               -----------        ------     -----------       ------    -----------
    Totals...................................   $   1,571      $   2,653                    $   2,323     $   1,901
                                               -----------        ------     -----------       ------    -----------
                                               -----------        ------     -----------       ------    -----------
</TABLE>
 
------------------------
 
(1) Uncollectible accounts written off, net of any recoveries.
 
(2) Represents $3,429 of allowances given in the form of credit memos.
 
(3) Represents $2,528 of allowances given in the form of credit memos.
 
(4) Represents $2,150 of allowances given in the form of credit memos and $5 of
    allowances paid in cash.

                                   48
<PAGE>
                                 EXHIBIT INDEX

    The following designated exhibits are, as indicated below, either filed
herewith of have heretofore been filed with the Securities and Exchange
Commission under the Securities Act of 1933 or the Securities Exchange Act of
1934 and are referred to and incorporated herein by reference to such filings.
As indicated, various exhibits are incorporated herein by reference to (i) the
Registrant's Registration Statement on Form S-1 (No. 33-70234), (referred to
herein below as "33-70234"), (ii) the Registant's Form 10-K for the year ended
December 31, 1993 (File No. 0-23070) (referred to herein below as "1993 10-K"),
(iii) the Registrant's Form 10-Q for the quarter ended April 2, 1994 (File No.
0-23070) (referred to herein below as "4/2/94 10-Q"), (iv) the Registrant's Form
8-K (File No. 0-23070) dated October 14, 1994 (referred to herein below as
"10/14/94 8-K"), (v) the Registrant's Form 10-Q for the quarter ended October 1,
1994 (File No. 0-23070) (referred to herein below as "10/1/94 10-Q"), (vi) the
Registrant's Registration Statement on Form S-1 (No. 33-87884) (referred to
herein below as "33-87884"), (vii) the
 
                                       49
<PAGE>

Registrant's Form 10-K for the year ended December 31, 1994 (File No. 
0-23070) (referred to herein below as "1994 10-K"), (viii) the Registrant's 
Form 10-K for the year ended December 31, 1995 (File No. 0-23070) (referred 
to herein below as "1995 10-K"), and (ix) the Registrant's Form 10-Q for the 
quarter ended September 28, 1996 (File No. 0-23070) (referred to herein below 
as "9/28/96 10-Q").

<TABLE>
<CAPTION>
                                                                 SEC                        EXHIBIT             
                                                               EXHIBIT                      NUMBER         DOCKET
                                             -------------------------------------------  -----------  --------------
<S>                                          <C>                                          <C>          <C>
Exhibit 3.                                   Articles of Incorporation and Bylaws
3.1                                          Restated Certificate of Incorporation, as
                                             amended                                             3.1         33-87884
3.2                                          Bylaws of the Company                               3.2         33-70234
Exhibit 4.                                   Instruments defining the rights of security
                                             holders
4.1                                          Specimen Certificate of Common Stock                4.1         33-70234
Exhibit 10.                                  Material contracts
10.1                                         Representatives' Warrants                          10.1        1993 10-K
10.2                                         Selective Retirement Plan of the
                                             Registrant, dated December 31, 1991,
                                             including Trust Agreement relating thereto         10.2         33-70234
10.3                                         1993 Equity Incentive Plan                         10.3         33-70234
10.4                                         1993 Directors' Stock Option Plan                  10.4         33-70234
10.5                                         Lease dated November 1, 1988 (including
                                             amendment) between the Registrant and
                                             Bensalem II Enterprises, relating to
                                             property at State Road, Bensalem, PA              10.18         33-70234
10.6                                         Lease dated June 30, 1992 between the
                                             Registrant and E&M Equities, relating to
                                             property at Edward Street, Linden, NJ             10.19         33-70234
10.7                                         Lease dated July 22, 1993 between the
                                             Registrant and Fleet Center Associates,
                                             relating to property at Fleet Center,
                                             Providence, RI                                    10.20         33-70234
10.8                                         Stock Purchase Agreement dated as of
                                             December 22, 1989 by and between Nortek,
                                             Inc. and Bristol Industries, Inc.                 10.22         33-70234

</TABLE>
 
                                      50
<PAGE>
<TABLE>
<CAPTION>
                                                                 SEC                        EXHIBIT
                                                               EXHIBIT                      NUMBER         DOCKET
                                             -------------------------------------------  -----------  --------------
<S>                                          <C>                                          <C>          <C>
10.9                                         Lease dated December 21, 1993 between the
                                             Registrant and Whitesell Enterprises,
                                             relating to property at Dulty's Lane,
                                             Burlington, NJ                                    10.23        1993 10-K
10.10                                        Lease dated March 18, 1994 between the
                                             Registrant and William L. Baker and Nancy
                                             A. Baker, relating to property at Leyshon
                                             Drive, Byesville, OH                               10.1      4/2/94 10-Q
10.11                                        Master Lease Agreement dated February 8,
                                             1993 by and between BancBoston Leasing,
                                             Inc. and the Registrant                            10.5      4/2/94 10-Q
10.12                                        Equipment Acquisition Agreement dated April
                                             15, 1994 by and between BancBoston Leasing,
                                             Inc. and the Registrant                            10.6      4/2/94 10-Q
10.13                                        Asset Purchase Agreement dated September
                                             30, 1994 by and among the Registrant, AFC
                                             Acquisition, Inc., Kaf-Tech, Inc. and David
                                             Kruse                                               2.1     10/14/94 8-K
10.14                                        Lease dated as of September 30, 1994 by and
                                             between AFC Acquisition, Inc. and Kaf-Tech,
                                             Inc., relating to property in Largo, FL            10.1     10/1/94 10-Q
</TABLE>

                                       51
<PAGE>
<TABLE>
<CAPTION>
                                                                 SEC                        EXHIBIT
                                                               EXHIBIT                      NUMBER        DOCKET
                                             -------------------------------------------  -----------  --------------
<S>                                          <C>                                          <C>          <C>
10.15                                        Lease dated February 1, 1995 by and between
                                             the Registrant and H. Glenn Butler,
                                             relating to property at 2660 Brenner Dr.,
                                             Dallas, TX                                        10.25        1994 10-K
10.16                                        Lease dated December 7, 1994 by and between
                                             the Registrant and TRST Orange County,
                                             Inc., relating to property at 1425 S.
                                             Acacia, Fullerton, CA                             10.26        1994 10-K
10.17                                        Purchase and sale agreement dated March 7,
                                             1996 between AFC Cable Systems, Inc. and
                                             L.J. Menco, Inc.                                  10.27        1995 10-K
10.18                                        Credit Agreement dated as of March 29, 1996
                                             by and between the Registrant and Fleet
                                             National Bank                                     10.28        1995 10-K
10.19                                        Revolving Credit Note in the aggregate
                                             principal amount of $25,000,000 dated as of
                                             March 29, 1996 by the Registrant to Fleet
                                             National Bank                                     10.29        1995 10-K
10.20                                        Term Note in the amount of $3,200,000 dated
                                             as of March 29, 1996 by the Registrant to
                                             Fleet National Bank                               10.30        1995 10-K
10.21                                        Loan and Trust Agreement among
                                             Massachusetts Industrial Finance Agency,
                                             the Registrant and Fleet National Bank, as
                                             Trustee, dated July 1, 1996                       10.1      9/28/96 10-Q
10.22                                        Reimbursement Agreement between the
                                             Registrant and Fleet National Bank, dated
                                             July 1, 1996                                      10.2      9/28/96 10-Q
10.23                                        Letter of Credit issued by Fleet National
                                             Bank for the account of the Registrant, for
                                             the benefit of Massachusetts Industrial
                                             Finance Agency, dated July 24, 1996               10.3      9/28/96 10-Q
10.24                                        Mortgage and Security Agreement
                                             issued by the Registrant to Fleet National
                                             Bank, dated July 1, 1996                          10.4      9/28/96 10-Q

</TABLE>
 
                                       52
<PAGE>
<TABLE>
<CAPTION>
                                                                 SEC                        EXHIBIT
                                                               EXHIBIT                      NUMBER        DOCKET
                                             -------------------------------------------  -----------  --------------
<S>                                          <C>                                          <C>          <C>
10.25                                        Pledge Agreement by and between the
                                             Registrant and Fleet National Bank, dated
                                             July 1, 1996                                      10.5      9/28/96 10-Q
10.26                                        Stock Purchase Agreement dated January 28,
                                             1997 by and between the Registrant and the
                                             Stockholders of B & B Electronics
                                             Manufacturing Co., Inc.                           10.26          *    
10.27                                        Asset Purchase Agreement dated January 31,
                                             1997 by and among AFC Acquisition, Inc. and
                                             Area Lighting Research, Inc.                      10.27          *
Exhibit 21.                                  Subsidiaries of the Registrant                                   
21.1                                         Subsidiaries of the Registrant                                   *
Exhibit 23.                                  Consents of experts and counsel
23.1                                         Consent of Ernst & Young LLP                                     *
</TABLE>

------------------------

* Filed herewith

                                       53
<PAGE>
                                   SIGNATURES
 
    Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
 
                                AFC CABLE SYSTEMS, INC.
 
                                BY:  /s/  Ralph R. Papitto
                                     -----------------------------------------
                                               Ralph R. Papitto
                                           CHAIRMAN OF THE BOARD AND
                                            CHIEF EXECUTIVE OFFICER
 
DATE: MARCH 25, 1997
 
    Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons in the capacities and on
the dates indicated:
 
<TABLE>
<CAPTION>

          SIGNATURE                      CAPACITY                    DATE
------------------------------  ---------------------------    ----------------
<S>                              <C>                            <C>

/s/ Ralph R. Papitto
------------------------------  Chairman of the Board, Chief      March 25, 1997
Ralph R. Papitto                Executive Officer (Principal 
                                Executive Officer) 

/s/ Robert R. Wheeler
------------------------------  President and Director            March 25, 1997
Robert R. Wheeler

/s/ Raymond H. Keller
------------------------------  Vice President, Chief Financial   March 25, 1997 
Raymond H. Keller               Officer and Director (Principal 
                                Financial and Accounting 
                                Officer)

/s/ Anthony J. Santoro
------------------------------  Director                          March 25, 1997 
Anthony J. Santoro      

/s/ Malcolm M. Donahue
------------------------------  Director                          March 25, 1997 
Malcolm M. Donahue

</TABLE>

                                     54