##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, DC 20549
 
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For
the quarterly period ended July 2, 2005
 or
 o
    
    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: 333-115543
 AMH Holdings, Inc.
  Delaware
    
    16-1693178(State or Other Jurisdiction of Incorporation of Organization)
    
    (I.R.S. Employer Identification No.)
 3773 State Rd. Cuyahoga Falls, Ohio
    
    44223(Address of Principal Executive Offices)
    
    (Zip Code)
 (330) 929 -1811
 
  þ o
  o þ




---



AMH HOLDINGS, INC.
  Page No.PART I. FINANCIAL INFORMATIONItem 1. Financial StatementsConsolidated
Balance Sheets 

July 2, 2005 (Unaudited) and January 1, 2005
    
    
    1Consolidated
Statements of Operations (Unaudited) 

Quarters ended July 2, 2005 and July 3, 2004

Six months ended July 2, 2005 and July 3, 2004
    
    
    2Consolidated
Statements of Cash Flows (Unaudited) 
Six months ended July 2, 2005 and July 3, 2004
    
    
    3Notes to Consolidated Financial Statements (Unaudited)
    
    
    4Item 2.
Managements Discussion and Analysis of

Financial Condition and Results of Operations
    
    
    15Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    23Item 4. Controls and Procedures
    
    
    23PART II.OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    24Item 6. Exhibits
    
    
    24SIGNATURES
    
    
    25EX-31.1 302 Certification of CEOEX-31.2 302 Certification of CFOEX-32.1 Section 906 Certification of CEOEX-32.2 Section 906 Certification of CFO




---



##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 AMH HOLDINGS, INC.
 
 
 (Unaudited)July 2,
    
    January 1,2005
    
    2005AssetsCurrent assets:Cash and cash equivalents
    
    $
    6,134
    
    
    $
    58,054Accounts receivable, net
    
    
    165,589
    
    
    
    125,666Receivable from parent
    
    
    1,241
    
    
    
    1,241Inventories
    
    
    146,146
    
    
    
    114,787Income taxes receivable
    
    
    4,039
    
    
    
    9,210Deferred income taxes
    
    
    18,253
    
    
    
    18,253Other current assets
    
    
    12,265
    
    
    
    12,938Total current assets
    
    
    353,667
    
    
    
    340,149Property, plant and equipment, net
    
    
    144,888
    
    
    
    138,697Goodwill
    
    
    234,817
    
    
    
    234,795Other intangible assets, net
    
    
    111,391
    
    
    
    113,044Other assets
    
    
    27,543
    
    
    
    29,169Total assets
    
    $
    872,306
    
    
    $
    855,854Liabilities and Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    96,567
    
    
    $
    75,139Accrued liabilities
    
    
    52,667
    
    
    
    54,379Notes payable
    
    
    
    
    
    
    11,607Current portion of long-term debt
    
    
    1,750
    
    
    
    875Total current liabilities
    
    
    150,984
    
    
    
    142,000Deferred income taxes
    
    
    47,430
    
    
    
    53,883Other liabilities
    
    
    43,297
    
    
    
    44,058Long-term debt
    
    
    681,742
    
    
    
    621,981Convertible preferred stock, $.01 par value
    
    
    150,000
    
    
    
    150,000Stockholders deficit
    
    
    (201,147
    )
    
    
    (156,068
    )Total liabilities and stockholders equity
    
    $
    872,306
    
    
    $
    855,854
  -1-




---



##### Table of Contents



AMH HOLDINGS, INC.
 
 
 Quarter
    
    Quarter
    
    Six Months
    
    Six MonthsEnded
    
    Ended
    
    Ended
    
    EndedJuly 2,
    
    July 3,
    
    July 2,
    
    July 3,2005
    
    2004
    
    2005
    
    2004Net sales
    
    $
    315,364
    
    
    $
    301,602
    
    
    $
    533,933
    
    
    $
    505,923Cost of sales
    
    
    243,162
    
    
    
    218,277
    
    
    
    412,699
    
    
    
    372,243Gross profit
    
    
    72,202
    
    
    
    83,325
    
    
    
    121,234
    
    
    
    133,680Selling, general and administrative expense
    
    
    50,829
    
    
    
    48,040
    
    
    
    101,580
    
    
    
    93,434Transaction
costs  bonuses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,498Facility closure costs
    
    
    862
    
    
    
    
    
    
    
    3,415
    
    
    
    Income from operations
    
    
    20,511
    
    
    
    35,285
    
    
    
    16,239
    
    
    
    25,748Interest expense, net
    
    
    16,301
    
    
    
    13,770
    
    
    
    31,597
    
    
    
    22,206Foreign currency loss
    
    
    292
    
    
    
    609
    
    
    
    289
    
    
    
    615Income (loss) before income taxes
    
    
    3,918
    
    
    
    20,906
    
    
    
    (15,647
    )
    
    
    2,927Income taxes (benefit)
    
    
    1,196
    
    
    
    9,162
    
    
    
    (6,287
    )
    
    
    1,886Net income (loss)
    
    $
    2,722
    
    
    $
    11,744
    
    
    $
    (9,360
    )
    
    $
    1,041
  -2-




---



##### Table of Contents



AMH HOLDINGS, INC.
 
 
 Six Months
    
    Six MonthsEnded
    
    EndedJuly 2,
    
    July 3,2005
    
    2004Operating ActivitiesNet income (loss)
    
    $
    (9,360
    )
    
    $
    1,041Adjustments to reconcile net income (loss) to net cash used in
operating activities:Depreciation and amortization
    
    
    10,077
    
    
    
    10,243Amortization of debt discount and deferred financing costs
    
    
    17,854
    
    
    
    10,671Amortization of management fee
    
    
    2,000
    
    
    
    Stock compensation expense
    
    
    319
    
    
    
    Tax benefit from stock option exercises
    
    
    
    
    
    
    2,586Deferred taxes
    
    
    (6,339
    )
    
    
    (3,451
    )Changes in operating assets and liabilities:Accounts receivable, net
    
    
    (40,605
    )
    
    
    (45,693
    )Inventories
    
    
    (32,370
    )
    
    
    (25,060
    )Income taxes
    
    
    5,305
    
    
    
    (4,258
    )Accounts payable and accrued liabilities
    
    
    21,060
    
    
    
    26,874Other
    
    
    (3,204
    )
    
    
    (2,721
    )Net cash used in operating activities
    
    
    (35,263
    )
    
    
    (29,768
    )Investing ActivitiesAdditions to property, plant and equipment
    
    
    (15,495
    )
    
    
    (12,196
    )Net cash used in investing activities
    
    
    (15,495
    )
    
    
    (12,196
    )Financing ActivitiesNet increase in revolving line of credit
    
    
    44,815
    
    
    
    26,159Dividends
    
    
    (33,713
    )
    
    
    Settlement of promissory notes
    
    
    (11,607
    )
    
    
    Proceeds from issuance of 11 1/4% senior discount notes
    
    
    
    
    
    
    258,265Options exercised
    
    
    (319
    )
    
    
    1,760Redemption of preferred stock
    
    
    
    
    
    
    (177,844
    )Common stock dividend
    
    
    
    
    
    
    (57,684
    )Financing costs
    
    
    (99
    )
    
    
    (10,327
    )Net cash provided by (used in) financing activities
    
    
    (923
    )
    
    
    40,329Net decrease in cash
    
    
    (51,681
    )
    
    
    (1,635
    )Effect of exchange rate changes on cash
    
    
    (239
    )
    
    
    42Cash at beginning of period
    
    
    58,054
    
    
    
    4,282Cash at end of period
    
    $
    6,134
    
    
    $
    2,689Supplemental information:Cash paid for interest
    
    $
    12,924
    
    
    $
    11,442Cash paid (received) for income taxes
    
    $
    (5,248
    )
    
    $
    7,005
  -3-




---



##### Table of Contents



AMH HOLDINGS, INC.
 
 
 Note 1  Basis of Presentation
       New Accounting Pronouncements
   -4-




---



##### Table of Contents



Note 2  Recapitalization Transactions
    Note 3  Inventories
  July 2,
    
    January 1,2005
    
    2005Raw materials
    
    $
    33,649
    
    
    $
    27,127Work-in-process
    
    
    14,921
    
    
    
    9,570Finished goods and purchased stock
    
    
    97,576
    
    
    
    78,090$
    146,146
    
    
    $
    114,787
 -5-




---



##### Table of Contents



Note 4
 Goodwill and Other Intangible Assets
  AverageAmortization
    
    July 2, 2005
    
    January 1, 2005Period
    
    
    
    
    
    Accumulated
    
    Net Carrying
    
    
    
    
    
    Accumulated
    
    Net Carrying(in Years)
    
    Cost
    
    Amortization
    
    Value
    
    Cost
    
    Amortization
    
    ValueTrademarks and
trade names
    
    
    15
    
    
    $
    109,280
    
    
    $
    5,646
    
    
    $
    103,634
    
    
    $
    109,280
    
    
    $
    4,712
    
    
    $
    104,568Patents
    
    
    10
    
    
    
    6,550
    
    
    
    2,090
    
    
    
    4,460
    
    
    
    6,550
    
    
    
    1,763
    
    
    
    4,787Customer base
    
    
    7
    
    
    
    4,696
    
    
    
    1,399
    
    
    
    3,297
    
    
    
    4,762
    
    
    
    1,073
    
    
    
    3,689Total other
intangible assets
    
    
    
    
    
    $
    120,526
    
    
    $
    9,135
    
    
    $
    111,391
    
    
    $
    120,592
    
    
    $
    7,548
    
    
    $
    113,044
 ® ® ®
 Note 5
 Long-Term Debt
  July 2,
    
    January 1,2005
    
    20059 3/4% notes
    
    $
    165,000
    
    
    $
    165,00011 1/4% senior discount notes
    
    
    298,677
    
    
    
    282,856Term loan under credit facility
    
    
    175,000
    
    
    
    175,000Revolving loans under credit
facility
    
    
    44,815
    
    
    
    Total debt
    
    
    683,492
    
    
    
    622,856Less current portion
    
    
    1,750
    
    
    
    875Long-term debt
    
    $
    681,742
    
    
    $
    621,981
    -6-




---



##### Table of Contents



Note 6
 Stock Plans
  Quarter
    
    Quarter
    
    Six Months
    
    Six MonthsEnded
    
    Ended
    
    Ended
    
    EndedJuly 2,
    
    July 3,
    
    July 2,
    
    July 3,2005
    
    2004
    
    2005
    
    2004Net income (loss) as reported
    
    $
    2,722
    
    
    $
    11,744
    
    
    $
    (9,360
    )
    
    $
    1,041Stock-based employee compensation expense included in
reported net income (loss), net of tax
    
    
    
    
    
    
    
    
    
    
    187
    
    
    
    Pro forma stock based employee compensation cost, net of tax
    
    
    (185
    )
    
    
    (53
    )
    
    
    (364
    )
    
    
    (81
    )Pro forma net income (loss)
    
    $
    2,537
    
    
    $
    11,691
    
    
    $
    (9,537
    )
    
    $
    960
 Note 7
 Comprehensive Income (Loss)
  Quarter
    
    Quarter
    
    Six Months
    
    Six MonthsEnded
    
    Ended
    
    Ended
    
    EndedJuly 2,
    
    July 3,
    
    July 2,
    
    July 3,2005
    
    2004
    
    2005
    
    2004Net income (loss) as reported
    
    $
    2,722
    
    
    $
    11,744
    
    
    $
    (9,360
    )
    
    $
    1,041Foreign currency translation adjustments
    
    
    (1,199
    )
    
    
    (272
    )
    
    
    (2,006
    )
    
    
    (1,133
    )Comprehensive income (loss)
    
    $
    1,523
    
    
    $
    11,472
    
    
    $
    (11,366
    )
    
    $
    (92
    )
 -7-




---



##### Table of Contents



Note 8
 Retirement Plans
  Quarter
    
    QuarterEnded
    
    EndedJuly 2,
    
    July 3,2005
    
    2004Domestic
    
    Foreign
    
    Domestic
    
    ForeignPlans
    
    Plans
    
    Plans
    
    PlansNet periodic pension costService cost
    
    $
    124
    
    
    $
    328
    
    
    $
    104
    
    
    $
    271Interest cost
    
    
    670
    
    
    
    498
    
    
    
    628
    
    
    
    432Expected return on assets
    
    
    (759
    )
    
    
    (528
    )
    
    
    (704
    )
    
    
    (426
    )Amortization of unrecognized net loss
    
    
    142
    
    
    
    1
    
    
    
    70
    
    
    
    Net periodic pension cost
    
    $
    177
    
    
    $
    299
    
    
    $
    98
    
    
    $
    277
 Six Months
    
    Six MonthsEnded
    
    EndedJuly 2,
    
    July 3,2005
    
    2004Domestic
    
    Foreign
    
    Domestic
    
    ForeignPlans
    
    Plans
    
    Plans
    
    PlansNet periodic pension costService cost
    
    $
    247
    
    
    $
    659
    
    
    $
    208
    
    
    $
    548Interest cost
    
    
    1,340
    
    
    
    1,002
    
    
    
    1,256
    
    
    
    873Expected return on assets
    
    
    (1,517
    )
    
    
    (1,061
    )
    
    
    (1,408
    )
    
    
    (860
    )Amortization of unrecognized net loss
    
    
    285
    
    
    
    1
    
    
    
    140
    
    
    
    Net periodic pension cost
    
    $
    355
    
    
    $
    601
    
    
    $
    196
    
    
    $
    561
 Note 9
 Facility Closure
   -8-




---



##### Table of Contents



Note 10  Subsidiary Guarantors
  ASSOCIATED MATERIALS INCORPORATED AND SUBSIDIARIES
 
 Guarantor
    
    Non-Guarantor
    
    Reclassification/Parent
    
    Subsidiaries
    
    Subsidiary
    
    Eliminations
    
    ConsolidatedAssetsCurrent assets:Cash and cash equivalents
    
    $
    2,851
    
    
    $
    300
    
    
    $
    2,983
    
    
    $
    
    
    
    $
    6,134Accounts receivable, net
    
    
    108,139
    
    
    
    28,477
    
    
    
    28,973
    
    
    
    
    
    
    
    165,589Intercompany receivables
    
    
    
    
    
    
    (6,832
    )
    
    
    15,093
    
    
    
    (8,261
    )
    
    
    Receivable from parent
    
    
    3,908
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,908Inventories
    
    
    91,042
    
    
    
    19,557
    
    
    
    35,547
    
    
    
    
    
    
    
    146,146Income taxes receivable
    
    
    1,511
    
    
    
    567
    
    
    
    1,401
    
    
    
    
    
    
    
    3,479Deferred income taxes
    
    
    
    
    
    
    16,319
    
    
    
    3,393
    
    
    
    (1,459
    )
    
    
    18,253Other current assets
    
    
    9,563
    
    
    
    1,490
    
    
    
    1,212
    
    
    
    
    
    
    
    12,265Total current assets
    
    
    217,014
    
    
    
    59,878
    
    
    
    88,602
    
    
    
    (9,720
    )
    
    
    355,774Property, plant and equipment, net
    
    
    108,429
    
    
    
    4,810
    
    
    
    31,649
    
    
    
    
    
    
    
    144,888Goodwill
    
    
    198,271
    
    
    
    36,546
    
    
    
    
    
    
    
    
    
    
    
    234,817Other intangible assets, net
    
    
    97,919
    
    
    
    12,165
    
    
    
    1,307
    
    
    
    
    
    
    
    111,391Investment in subsidiaries
    
    
    131,643
    
    
    
    62,783
    
    
    
    
    
    
    
    (194,426
    )
    
    
    Other assets
    
    
    18,303
    
    
    
    
    
    
    
    130
    
    
    
    
    
    
    
    18,433Total assets
    
    $
    771,579
    
    
    $
    176,182
    
    
    $
    121,688
    
    
    $
    (204,146
    )
    
    $
    865,303Liabilities and Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    54,877
    
    
    $
    16,126
    
    
    $
    25,564
    
    
    $
    
    
    
    $
    96,567Intercompany payables
    
    
    8,261
    
    
    
    
    
    
    
    
    
    
    
    (8,261
    )
    
    
    Accrued liabilities
    
    
    39,268
    
    
    
    6,794
    
    
    
    6,605
    
    
    
    
    
    
    
    52,667Deferred income taxes
    
    
    1,459
    
    
    
    
    
    
    
    
    
    
    
    (1,459
    )
    
    
    Current portion of long term debt
    
    
    1,750
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,750Total current liabilities
    
    
    105,615
    
    
    
    22,920
    
    
    
    32,169
    
    
    
    (9,720
    )
    
    
    150,984Deferred income taxes
    
    
    50,416
    
    
    
    5,559
    
    
    
    6,632
    
    
    
    
    
    
    
    62,607Other liabilities
    
    
    18,948
    
    
    
    16,060
    
    
    
    8,289
    
    
    
    
    
    
    
    43,297Long-term debt
    
    
    371,250
    
    
    
    
    
    
    
    11,815
    
    
    
    
    
    
    
    383,065Stockholders equity
    
    
    225,350
    
    
    
    131,643
    
    
    
    62,783
    
    
    
    (194,426
    )
    
    
    225,350Total liabilities and stockholders equity
    
    $
    771,579
    
    
    $
    176,182
    
    
    $
    121,688
    
    
    $
    (204,146
    )
    
    $
    865,303
 -9-




---



##### Table of Contents



ASSOCIATED MATERIALS INCORPORATED AND SUBSIDIARIES
 
 Guarantor
    
    Non-Guarantor
    
    Reclassification/Parent
    
    Subsidiaries
    
    Subsidiary
    
    Eliminations
    
    ConsolidatedNet sales
    
    $
    222,726
    
    
    $
    65,523
    
    
    $
    73,219
    
    
    $
    (46,104
    )
    
    $
    315,364Cost of sales
    
    
    166,134
    
    
    
    61,782
    
    
    
    61,350
    
    
    
    (46,104
    )
    
    
    243,162Gross profit
    
    
    56,592
    
    
    
    3,741
    
    
    
    11,869
    
    
    
    
    
    
    
    72,202Selling, general and administrative expense
    
    
    39,164
    
    
    
    5,322
    
    
    
    6,343
    
    
    
    
    
    
    
    50,829Facility closure costs
    
    
    862
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    862Income (loss) from operations
    
    
    16,566
    
    
    
    (1,581
    )
    
    
    5,526
    
    
    
    
    
    
    
    20,511Interest expense, net
    
    
    7,721
    
    
    
    (2
    )
    
    
    223
    
    
    
    
    
    
    
    7,942Foreign currency loss
    
    
    
    
    
    
    
    
    
    
    292
    
    
    
    
    
    
    
    292Income (loss) before income taxes
    
    
    8,845
    
    
    
    (1,579
    )
    
    
    5,011
    
    
    
    
    
    
    
    12,277Income taxes (benefit)
    
    
    3,619
    
    
    
    (688
    )
    
    
    1,651
    
    
    
    
    
    
    
    4,582Income (loss) before equity income from
subsidiaries
    
    
    5,226
    
    
    
    (891
    )
    
    
    3,360
    
    
    
    
    
    
    
    7,695Equity income from subsidiaries
    
    
    2,469
    
    
    
    3,360
    
    
    
    
    
    
    
    (5,829
    )
    
    
    Net income
    
    $
    7,695
    
    
    $
    2,469
    
    
    $
    3,360
    
    
    $
    (5,829
    )
    
    $
    7,695
 ASSOCIATED MATERIALS INCORPORATED AND SUBSIDIARIES
 
 Guarantor
    
    Non-Guarantor
    
    Reclassification/Parent
    
    Subsidiaries
    
    Subsidiary
    
    Eliminations
    
    ConsolidatedNet sales
    
    $
    377,440
    
    
    $
    110,645
    
    
    $
    119,240
    
    
    $
    (73,392
    )
    
    $
    533,933Cost of sales
    
    
    284,303
    
    
    
    102,153
    
    
    
    99,635
    
    
    
    (73,392
    )
    
    
    412,699Gross profit
    
    
    93,137
    
    
    
    8,492
    
    
    
    19,605
    
    
    
    
    
    
    
    121,234Selling, general and administrative expense
    
    
    77,896
    
    
    
    11,242
    
    
    
    12,442
    
    
    
    
    
    
    
    101,580Facility closure costs
    
    
    3,415
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,415Income (loss) from operations
    
    
    11,826
    
    
    
    (2,750
    )
    
    
    7,163
    
    
    
    
    
    
    
    16,239Interest expense, net
    
    
    14,919
    
    
    
    
    
    
    
    334
    
    
    
    
    
    
    
    15,253Foreign currency loss
    
    
    
    
    
    
    
    
    
    
    289
    
    
    
    
    
    
    
    289Income (loss) before income taxes
    
    
    (3,093
    )
    
    
    (2,750
    )
    
    
    6,540
    
    
    
    
    
    
    
    697Income taxes (benefit)
    
    
    (759
    )
    
    
    (1,169
    )
    
    
    2,191
    
    
    
    
    
    
    
    263Income (loss) before equity income from
subsidiaries
    
    
    (2,334
    )
    
    
    (1,581
    )
    
    
    4,349
    
    
    
    
    
    
    
    434Equity income from subsidiaries
    
    
    2,768
    
    
    
    4,349
    
    
    
    
    
    
    
    (7,117
    )
    
    
    Net income
    
    $
    434
    
    
    $
    2,768
    
    
    $
    4,349
    
    
    $
    (7,117
    )
    
    $
    434
 -10-




---



##### Table of Contents



ASSOCIATED MATERIALS INCORPORATED AND SUBSIDIARIES
 
 Guarantor
    
    Non-GuarantorParent
    
    Subsidiaries
    
    Subsidiary
    
    ConsolidatedNet cash used in operating activities
    
    $
    (15,331
    )
    
    $
    (10,986
    )
    
    $
    (9,364
    )
    
    $
    (35,681
    )Investing ActivitiesAdditions to property, plant and equipment
    
    
    (14,425
    )
    
    
    (411
    )
    
    
    (659
    )
    
    
    (15,495
    )Net cash used in investing activities
    
    
    (14,425
    )
    
    
    (411
    )
    
    
    (659
    )
    
    
    (15,495
    )Financing ActivitiesNet increase in revolving line of credit
    
    
    33,000
    
    
    
    
    
    
    
    11,815
    
    
    
    44,815Dividends
    
    
    (33,713
    )
    
    
    
    
    
    
    
    
    
    
    (33,713
    )Settlement of promissory notes
    
    
    (11,607
    )
    
    
    
    
    
    
    
    
    
    
    (11,607
    )Intercompany transactions
    
    
    1,234
    
    
    
    4,814
    
    
    
    (6,048
    )
    
    
    Net cash provided by (used in) financing activities
    
    
    (11,086
    )
    
    
    4,814
    
    
    
    5,767
    
    
    
    (505
    )Net decrease in cash
    
    
    (40,842
    )
    
    
    (6,583
    )
    
    
    (4,256
    )
    
    
    (51,681
    )Effect of exchange rate changes on cash
    
    
    
    
    
    
    
    
    
    
    (239
    )
    
    
    (239
    )Cash at beginning of period
    
    
    43,693
    
    
    
    6,883
    
    
    
    7,478
    
    
    
    58,054Cash at end of period
    
    $
    2,851
    
    
    $
    300
    
    
    $
    2,983
    
    
    $
    6,134
 -11-




---



##### Table of Contents



ASSOCIATED MATERIALS INCORPORATED AND SUBSIDIARIES
 
 Guarantor
    
    Non-Guarantor
    
    Reclassification/Parent
    
    Subsidiaries
    
    Subsidiary
    
    Eliminations
    
    ConsolidatedAssetsCurrent assets:Cash and cash equivalents
    
    $
    43,693
    
    
    $
    6,883
    
    
    $
    7,478
    
    
    $
    
    
    
    $
    58,054Accounts receivable, net
    
    
    88,930
    
    
    
    18,167
    
    
    
    18,569
    
    
    
    
    
    
    
    125,666Intercompany receivables
    
    
    
    
    
    
    (1,554
    )
    
    
    8,582
    
    
    
    (7,028
    )
    
    
    Receivable from parent
    
    
    3,490
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,490Inventories
    
    
    65,854
    
    
    
    19,435
    
    
    
    29,498
    
    
    
    
    
    
    
    114,787Income taxes receivable
    
    
    10,347
    
    
    
    
    
    
    
    
    
    
    
    (1,487
    )
    
    
    8,860Deferred income taxes
    
    
    
    
    
    
    16,471
    
    
    
    3,393
    
    
    
    (1,611
    )
    
    
    18,253Other current assets
    
    
    10,844
    
    
    
    1,302
    
    
    
    792
    
    
    
    
    
    
    
    12,938Total current assets
    
    
    223,158
    
    
    
    60,704
    
    
    
    68,312
    
    
    
    (10,126
    )
    
    
    342,048Property, plant and equipment, net
    
    
    100,184
    
    
    
    5,033
    
    
    
    33,480
    
    
    
    
    
    
    
    138,697Goodwill
    
    
    198,270
    
    
    
    36,526
    
    
    
    
    
    
    
    
    
    
    
    234,796Other intangible assets, net
    
    
    99,038
    
    
    
    12,510
    
    
    
    1,496
    
    
    
    
    
    
    
    113,044Investment in subsidiaries
    
    
    99,321
    
    
    
    59,996
    
    
    
    
    
    
    
    (159,317
    )
    
    
    Other assets
    
    
    19,460
    
    
    
    
    
    
    
    174
    
    
    
    
    
    
    
    19,634Total assets
    
    $
    739,431
    
    
    $
    174,769
    
    
    $
    103,462
    
    
    $
    (169,443
    )
    
    $
    848,219Liabilities and Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    41,446
    
    
    $
    13,753
    
    
    $
    19,940
    
    
    $
    
    
    
    $
    75,139Intercompany payables
    
    
    7,028
    
    
    
    
    
    
    
    
    
    
    
    (7,028
    )
    
    
    Accrued liabilities
    
    
    39,569
    
    
    
    7,146
    
    
    
    7,664
    
    
    
    
    
    
    
    54,379Notes payable
    
    
    11,607
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,607Current portion of long term debt
    
    
    875
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    875Deferred income taxes
    
    
    1,611
    
    
    
    
    
    
    
    
    
    
    
    (1,611
    )
    
    
    Income taxes payable
    
    
    
    
    
    
    855
    
    
    
    632
    
    
    
    (1,487
    )
    
    
    Total current liabilities
    
    
    102,136
    
    
    
    21,754
    
    
    
    28,236
    
    
    
    (10,126
    )
    
    
    142,000Deferred income taxes
    
    
    50,264
    
    
    
    5,711
    
    
    
    6,745
    
    
    
    
    
    
    
    62,720Other liabilities
    
    
    19,150
    
    
    
    16,423
    
    
    
    8,485
    
    
    
    
    
    
    
    44,058Long-term debt
    
    
    339,125
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    339,125Stockholders equity
    
    
    228,756
    
    
    
    130,881
    
    
    
    59,996
    
    
    
    (159,317
    )
    
    
    260,316Total liabilities and stockholders equity
    
    $
    739,431
    
    
    $
    174,769
    
    
    $
    103,462
    
    
    $
    (169,443
    )
    
    $
    848,219
 -12-




---



##### Table of Contents



ASSOCIATED MATERIALS INCORPORATED AND SUBSIDIARIES
 
 Guarantor
    
    Non-Guarantor
    
    Reclassification/Parent
    
    Subsidiaries
    
    Subsidiary
    
    Eliminations
    
    ConsolidatedNet sales
    
    $
    212,763
    
    
    $
    48,610
    
    
    $
    60,033
    
    
    $
    (19,804
    )
    
    $
    301,602Cost of sales
    
    
    148,425
    
    
    
    41,316
    
    
    
    48,340
    
    
    
    (19,804
    )
    
    
    218,277Gross profit
    
    
    64,338
    
    
    
    7,294
    
    
    
    11,693
    
    
    
    
    
    
    
    83,325Selling, general and administrative expense
    
    
    36,462
    
    
    
    5,803
    
    
    
    5,775
    
    
    
    
    
    
    
    48,040Income from operations
    
    
    27,876
    
    
    
    1,491
    
    
    
    5,918
    
    
    
    
    
    
    
    35,285Interest expense, net
    
    
    6,151
    
    
    
    7
    
    
    
    96
    
    
    
    
    
    
    
    6,254Foreign currency loss
    
    
    
    
    
    
    
    
    
    
    609
    
    
    
    
    
    
    
    609Income before income taxes
    
    
    21,725
    
    
    
    1,484
    
    
    
    5,213
    
    
    
    
    
    
    
    28,422Income taxes
    
    
    9,015
    
    
    
    264
    
    
    
    2,424
    
    
    
    
    
    
    
    11,703Income before equity income from subsidiaries
    
    
    12,710
    
    
    
    1,220
    
    
    
    2,789
    
    
    
    
    
    
    
    16,719Equity income from subsidiaries
    
    
    4,009
    
    
    
    2,789
    
    
    
    
    
    
    
    (6,798
    )
    
    
    Net income
    
    $
    16,719
    
    
    $
    4,009
    
    
    $
    2,789
    
    
    $
    (6,798
    )
    
    $
    16,719
 ASSOCIATED MATERIALS INCORPORATED AND SUBSIDIARIES
 
 Guarantor
    
    Non-Guarantor
    
    Reclassification/Parent
    
    Subsidiaries
    
    Subsidiary
    
    Eliminations
    
    ConsolidatedNet sales
    
    $
    353,194
    
    
    $
    88,380
    
    
    $
    98,836
    
    
    $
    (34,487
    )
    
    $
    505,923Cost of sales
    
    
    250,494
    
    
    
    75,710
    
    
    
    80,526
    
    
    
    (34,487
    )
    
    
    372,243Gross profit
    
    
    102,700
    
    
    
    12,670
    
    
    
    18,310
    
    
    
    
    
    
    
    133,680Selling, general and administrative expense
    
    
    70,752
    
    
    
    11,392
    
    
    
    11,290
    
    
    
    
    
    
    
    93,434Transaction costs  bonuses
    
    
    14,498
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,498Income from operations
    
    
    17,450
    
    
    
    1,278
    
    
    
    7,020
    
    
    
    
    
    
    
    25,748Interest expense, net
    
    
    12,128
    
    
    
    7
    
    
    
    131
    
    
    
    
    
    
    
    12,266Foreign currency loss
    
    
    
    
    
    
    
    
    
    
    615
    
    
    
    
    
    
    
    615Income before income taxes
    
    
    5,322
    
    
    
    1,271
    
    
    
    6,274
    
    
    
    
    
    
    
    12,867Income taxes
    
    
    2,207
    
    
    
    167
    
    
    
    2,873
    
    
    
    
    
    
    
    5,247Income before equity income from subsidiaries
    
    
    3,115
    
    
    
    1,104
    
    
    
    3,401
    
    
    
    
    
    
    
    7,620Equity income from subsidiaries
    
    
    4,505
    
    
    
    3,401
    
    
    
    
    
    
    
    (7,906
    )
    
    
    Net income
    
    $
    7,620
    
    
    $
    4,505
    
    
    $
    3,401
    
    
    $
    (7,906
    )
    
    $
    7,620
 -13-




---



##### Table of Contents



ASSOCIATED MATERIALS INCORPORATED AND SUBSIDIARIES
 
 Guarantor
    
    Non-Guarantor
    
    Reclassification/Parent
    
    Subsidiaries
    
    Subsidiary
    
    Eliminations
    
    ConsolidatedNet cash used in operating activities
    
    $
    (19,910
    )
    
    $
    (5,335
    )
    
    $
    (5,816
    )
    
    $
    1,099
    
    
    $
    (29,962
    )Investing ActivitiesAdditions to property, plant and equipment
    
    
    (11,063
    )
    
    
    (721
    )
    
    
    (412
    )
    
    
    
    
    
    
    (12,196
    )Net cash used in investing activities
    
    
    (11,063
    )
    
    
    (721
    )
    
    
    (412
    )
    
    
    
    
    
    
    (12,196
    )Financing ActivitiesNet increase in revolving line of credit
    
    
    14,000
    
    
    
    
    
    
    
    12,159
    
    
    
    
    
    
    
    26,159Equity contribution from Holdings
    
    
    14,498
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,498Financing costs
    
    
    (67
    )
    
    
    
    
    
    
    (101
    )
    
    
    
    
    
    
    (168
    )Intercompany transactions
    
    
    1,554
    
    
    
    4,104
    
    
    
    (5,658
    )
    
    
    
    
    
    
    Net cash provided by financing activities
    
    
    29,985
    
    
    
    4,104
    
    
    
    6,400
    
    
    
    
    
    
    
    40,489Net increase (decrease) in cash
    
    
    (988
    )
    
    
    (1,952
    )
    
    
    172
    
    
    
    1,099
    
    
    
    (1,669
    )Effect of exchange rate changes on cash
    
    
    
    
    
    
    
    
    
    
    42
    
    
    
    
    
    
    
    42Cash at beginning of period
    
    
    2,399
    
    
    
    2,982
    
    
    
    
    
    
    
    (1,099
    )
    
    
    4,282Cash at end of period
    
    $
    1,411
    
    
    $
    1,030
    
    
    $
    214
    
    
    $
    
    
    
    $
    2,655
 -14-




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Overview
   ® ® ®
    -15-




---



##### Table of Contents



Results of Operations
  Quarter
    
    Quarter
    
    Six Months
    
    Six MonthsEnded
    
    Ended
    
    Ended
    
    EndedJuly 2,
    
    July 3,
    
    July 2,
    
    July 3,2005
    
    2004
    
    2005
    
    2004Net sales
    
    $
    315,364
    
    
    $
    301,602
    
    
    $
    533,933
    
    
    $
    505,923Cost of sales
    
    
    243,162
    
    
    
    218,277
    
    
    
    412,699
    
    
    
    372,243Gross profit
    
    
    72,202
    
    
    
    83,325
    
    
    
    121,234
    
    
    
    133,680Selling, general and administrative expense
    
    
    50,829
    
    
    
    48,040
    
    
    
    101,580
    
    
    
    93,434Transaction
costs  bonuses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,498Facility closure costs
    
    
    862
    
    
    
    
    
    
    
    3,415
    
    
    
    Income from operations
    
    
    20,511
    
    
    
    35,285
    
    
    
    16,239
    
    
    
    25,748Interest expense, net
    
    
    16,301
    
    
    
    13,770
    
    
    
    31,597
    
    
    
    22,206Foreign currency loss
    
    
    292
    
    
    
    609
    
    
    
    289
    
    
    
    615Income (loss) before income taxes
    
    
    3,918
    
    
    
    20,906
    
    
    
    (15,647
    )
    
    
    2,927Income taxes (benefit)
    
    
    1,196
    
    
    
    9,162
    
    
    
    (6,287
    )
    
    
    1,886Net income (loss)
    
    $
    2,722
    
    
    $
    11,744
    
    
    $
    (9,360
    )
    
    $
    1,041
 -16-




---



##### Table of Contents



Quarter
    
    Quarter
    
    Six Months
    
    Six MonthsEnded
    
    Ended
    
    Ended
    
    EndedJuly 2,
    
    July 3,
    
    July 2,
    
    July 3,2005
    
    2004
    
    2005
    
    2004Other Data:EBITDA (a)
    
    $
    25,340
    
    
    $
    39,813
    
    
    $
    26,027
    
    
    $
    35,376Adjusted EBITDA (a)
    
    
    27,494
    
    
    
    40,422
    
    
    
    32,050
    
    
    
    50,489
 
 (a)
    
    EBITDA is calculated as net income plus interest, taxes, depreciation and amortization.
Adjusted EBITDA excludes certain items. The Company considers adjusted EBITDA to be an
important indicator of its operational strength and performance of its business. The Company
has included adjusted EBITDA because it is a key financial measure used by management to (i)
assess the Companys ability to service its debt and / or incur debt and meet the Companys
capital expenditure requirements; (ii) internally measure the Companys operating
performance; and (iii) determine the Companys incentive
compensation programs. In addition AMIs credit facility has certain covenants that use ratios utilizing this measure of
adjusted EBITDA. The definition of EBITDA under the indentures governing the notes also
excludes certain items. Adjusted EBITDA has not been prepared in accordance with accounting
principles generally accepted in the United States (GAAP). Adjusted EBITDA as presented by
the Company may not be comparable to similarly titled measures reported by other companies.
Adjusted EBITDA is not a measure determined in accordance with GAAP and should not be
considered as an alternative to, or more meaningful than, net income (as determined in
accordance with GAAP) as a measure of the Companys operating results or cash flows from
operations (as determined in accordance with GAAP) as a measure of the Companys liquidity.
The reconciliation of the Companys net income (loss) to EBITDA and adjusted EBITDA is as
follows (in thousands): Quarter Ended
    
    Quarter Ended
    
    Six Months Ended
    
    Six Months EndedJuly 2, 2005
    
    July 3, 2004
    
    July 2, 2005
    
    July 3, 2004Net income (loss)
    
    $
    2,722
    
    
    $
    11,744
    
    
    $
    (9,360
    )
    
    $
    1,041Interest expense, net
    
    
    16,301
    
    
    
    13,770
    
    
    
    31,597
    
    
    
    22,206Income taxes (benefit)
    
    
    1,196
    
    
    
    9,162
    
    
    
    (6,287
    )
    
    
    1,886Depreciation and amortization
    
    
    5,121
    
    
    
    5,137
    
    
    
    10,077
    
    
    
    10,243EBITDA
    
    
    25,340
    
    
    
    39,813
    
    
    
    26,027
    
    
    
    35,376Foreign currency loss
    
    
    292
    
    
    
    609
    
    
    
    289
    
    
    
    615Transaction
costs  bonuses (b)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,498Amortization of management fee (c)
    
    
    1,000
    
    
    
    
    
    
    
    2,000
    
    
    
    Stock compensation expense
    
    
    
    
    
    
    
    
    
    
    319
    
    
    
    Facility closure costs (d)
    
    
    862
    
    
    
    
    
    
    
    3,415
    
    
    
    Adjusted EBITDA
    
    $
    27,494
    
    
    $
    40,422
    
    
    $
    32,050
    
    
    $
    50,489
 
 (b)
    
    Represents management and director bonuses paid in connection with the March 2004 dividend
recapitalization.(c)
    
    Represents amortization of a prepaid management fee paid to Investcorp in connection with
the December 2004 recapitalization transaction.(d)
    
    Represents one-time costs associated with the closure of the Freeport, Texas manufacturing
facility consisting primarily of equipment relocation expenses. Total pre-tax expenses
related to the Freeport closing are expected to be $8.7 million, which includes a $4.5
million pre-tax charge recorded in the fourth quarter of 2004. Quarter Ended July 2, 2005 Compared to Quarter Ended July 3, 2004
   -17-




---



##### Table of Contents



Six Months Ended July 2, 2005 Compared to Six Months Ended July 3, 2004
  -18-




---



##### Table of Contents



Liquidity and Capital Resources
  Six Months
    
    Six MonthsEnded
    
    EndedJuly 2,
    
    July 3,2005
    
    2004Cash used in operating activities
    
    $
    (35,263
    )
    
    $
    (29,768
    )Cash used in investing activities
    
    
    (15,495
    )
    
    
    (12,196
    )Cash provided by (used in) financing activities
    
    
    (923
    )
    
    
    40,329
 Cash Flows
  Cash Flows from Operating Activities
  Cash Flows from Investing Activities
  -19-




---



##### Table of Contents



Cash Flows from Financing Activities
  Description of the Companys Outstanding Indebtedness
     -20-




---



##### Table of Contents



Effects of Inflation
  Certain Forward-Looking Statements
  
    
    the Companys operations and results of operations;
    
    changes in home building industry, economic conditions, interest rates,
foreign currency exchange rates and other conditions;
    
    changes in availability of consumer credit, employment trends, levels of
consumer confidence and consumer preferences;
    
    changes in raw material costs and availability;
    
    market acceptance of price increases;
    
    changes in national and regional trends in new housing starts and home remodeling;
    
    changes in weather conditions;
    
    the Companys ability to comply with certain financial covenants in the
loan documents governing its indebtedness;
    
    increases in competition from other manufacturers of vinyl and metal
exterior residential building products as well as alternative building products;
    
    shifts in market demand;
    
    increases in the Companys indebtedness;
    
    increases in costs of environmental compliance;
    
    increases in capital expenditure requirements;
 -21-




---



##### Table of Contents




    
    potential conflict between existing Alside and Gentek distribution channels;
    
    the achievement of anticipated synergies and operational efficiencies from the Gentek acquisition; and
    
    the other factors discussed under the heading Risk Factors in the
Companys annual report on Form 10-K for the year ended January 1, 2005 and elsewhere
in this report.
  -22-




---



##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
 Interest Rate Risk
   Foreign Currency Exchange Risk
  Commodity Price Risk
  
 Item 4. Controls and Procedures
   -23-




---



##### Table of Contents



PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
   
 Item 6. Exhibits
 (a) Exhibits
 ExhibitNumber
    
    Description31.1
    
    Certification of the Chief Executive Officer pursuant to Rule 13a-14 of the Exchange Act, as
adopted, pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Certification of the Chief Financial Officer pursuant to Rule 13a-14 of the Exchange Act, as
adopted, pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted,
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*32.2
    
    Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted,
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
 
 *
    
    This document is being furnished in accordance with SEC Release Nos. 33-8212 and 34-47551. -24-




---



##### Table of Contents



SIGNATURES
 Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly authorized.
 AMH HOLDINGS, INC.
           (Registrant)Date: August 16, 2005
    By:
    /s/ Michael Caporale, Jr.Michael Caporale, Jr.Chairman, President and
Chief Executive Officer
(Principal Executive Officer) By:
    /s/ D. Keith LaVanwayD. Keith LaVanwayVice President  Finance,
Chief Financial Officer,
Treasurer and Secretary
(Principal Financial Officer and
Principal Accounting Officer) -25-




---



##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description31.1
    
    Certification of the Chief Executive Officer pursuant to Rule 13a-14 of the Exchange Act, as
adopted, pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Certification of the Chief Financial Officer pursuant to Rule 13a-14 of the Exchange Act, as
adopted, pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted,
pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted,
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 -26-