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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549
 FORM 10-Q (Mark One) x
    
    Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended April 4, 2004
 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 1-12164 WOLVERINE TUBE, INC.   Delaware
    
    63-0970812(State of Incorporation)
    
    (IRS Employer Identification No.)
 200 Clinton Avenue West, Suite 1000Huntsville, Alabama
    
    
    35801(Address of Principal Executive Offices)
    
    (Zip Code)
 (256) 353-1310   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 o Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). YES x       NO o Indicate the number of shares outstanding of each class of Common Stock, as of
the latest practicable date: Class
    
    Outstanding as of April 30, 2004Common Stock, $0.01 Par Value
    
    12,314,816 shares




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FORM 10-Q QUARTERLY REPORT TABLE OF CONTENTS Page No.PART IItem 1.
    
    Financial StatementsCondensed Consolidated Statements of Income (Unaudited)Three-Month Periods Ended April 4, 2004 and March 30, 2003
    
    
    1Condensed Consolidated Balance SheetsApril 4, 2004 (Unaudited) and December 31, 2003
    
    
    2Condensed Consolidated Statements of Cash Flows (Unaudited)Three-Month Periods Ended April 4, 2004 and March 30, 2003
    
    
    3Notes to Condensed Consolidated Financial Statements (Unaudited)
    
    
    4Item 2.
    
    Managements Discussion and Analysis of FinancialCondition and Results of Operations
    
    
    17Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    25Item 4.
    
    Controls and Procedures
    
    
    27PART IIItem 1.
    
    Legal Proceedings
    
    
    28Item 6.
    
    Exhibits and Reports on Form 8-K
    
    
    28EX-10.1  AMENDMENT NO. 4 TO CREDIT AGREEMENTEX-10.2  CONSIGNMENT AND TRADING LINE AGREEMENTEX-10.3  AMENDMENT NO. 1 TO AGREEMENTEX-10.4  AMENDMENT NO. 2 TO AGREEMENTEX-10.5  AMENDMENT NO. 3 TO AGREEMENTEX-10.6  AMENDMENT NO. 4 TO AGREEMENTEX-10.7  AMENDMENT NO. 5 TO AGREEMENTEX-10.8  AMENDMENT NO. 6 TO AGREEMENTEX-10.9  AMENDMENT NO. 7 TO AGREEMENTEX-31.1  SECTION 302 CERTIFICATION OF THE CEOEX-31.2  SECTION 302 CERTIFICATION OF THE CFOEX-32.1  SECTION 906 CERTIFICATION OF THE CEOEX-32.2  SECTION 906 CERTIFICATION OF THE CFO




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ITEM 1. FINANCIAL STATEMENTS Wolverine Tube, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Income
  Three-month period ended:April 4, 2004
    
    March 30, 2003(In thousands except per share amounts)Net sales
    
    $
    205,805
    
    
    $
    143,497Cost of goods sold
    
    
    188,320
    
    
    
    128,875Gross profit
    
    
    17,485
    
    
    
    14,622Selling, general and administrative expenses
    
    
    9,437
    
    
    
    8,142Restructuring charges
    
    
    571
    
    
    
    Income from operations
    
    
    7,477
    
    
    
    6,480Other expenses:Interest expense, net
    
    
    5,070
    
    
    
    5,178Amortization and other, net
    
    
    668
    
    
    
    542Income before income taxes
    
    
    1,739
    
    
    
    760Income tax provision
    
    
    371
    
    
    
    122Net income
    
    $
    1,368
    
    
    $
    638Net income per common share  basic
    
    $
    0.11
    
    
    $
    0.05Basic weighted average number of common shares
    
    
    12,289
    
    
    
    12,262Net income per common share  diluted
    
    $
    0.11
    
    
    $
    0.05Diluted weighted average number of common and
common equivalent shares
    
    
    12,534
    
    
    
    12,398
 See Notes to Condensed Consolidated Financial Statements. 1




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Wolverine Tube, Inc. and Subsidiaries 
 Condensed Consolidated Balance Sheets
 April 4, 2004
    
    December 31, 2003(In thousands except share and per share amounts)
    
    (Unaudited)
    
    (Note)AssetsCurrent assetsCash and equivalents
    
    $
    31,606
    
    
    $
    46,089Accounts receivable, net
    
    
    119,101
    
    
    
    86,825Inventories
    
    
    118,361
    
    
    
    108,005Prepaid expenses and other
    
    
    16,467
    
    
    
    12,782Total current assets
    
    
    285,535
    
    
    
    253,701Property, plant and equipment, net
    
    
    194,904
    
    
    
    198,542Deferred charges, net
    
    
    15,450
    
    
    
    14,770Goodwill, net
    
    
    77,133
    
    
    
    77,159Assets held for sale
    
    
    4,008
    
    
    
    4,797Prepaid pensions and other
    
    
    4,365
    
    
    
    4,289Total assets
    
    $
    581,395
    
    
    $
    553,258Liabilities and Stockholders EquityCurrent liabilitiesAccounts payable
    
    $
    62,488
    
    
    $
    47,503Accrued liabilities
    
    
    19,384
    
    
    
    29,787Short-term borrowings
    
    
    1,315
    
    
    
    1,502Total current liabilities
    
    
    83,187
    
    
    
    78,792Deferred income taxes
    
    
    538
    
    
    
    359Long-term debt
    
    
    274,474
    
    
    
    254,284Pension liabilities
    
    
    23,307
    
    
    
    22,316Postretirement benefit obligation
    
    
    16,990
    
    
    
    16,995Accrued environmental remediation
    
    
    1,119
    
    
    
    1,161Total liabilities
    
    
    399,615
    
    
    
    373,907Stockholders equityCommon stock, par value $0.01 per share;
40,000,000 shares authorized; 14,363,951
and 14,344,806 shares issued as of April
4, 2004 and December 31, 2003, respectively
    
    
    144
    
    
    
    143Additional paid-in capital
    
    
    103,314
    
    
    
    103,339Retained earnings
    
    
    125,294
    
    
    
    123,926Unearned compensation
    
    
    (110
    )
    
    
    (172
    )Accumulated other comprehensive loss
    
    
    (9,487
    )
    
    
    (10,510
    )Treasury stock, at cost; 2,063,800 shares
as of April 4, 2004 and December 31, 2003
    
    
    (37,375
    )
    
    
    (37,375
    )Total stockholders equity
    
    
    181,780
    
    
    
    179,351Total liabilities and stockholders equity
    
    $
    581,395
    
    
    $
    553,258
 Note:
    
    The Balance Sheet at December 31, 2003 has been derived from the audited
financial statements at that date but does not include all of the
information and footnotes required by accounting principles generally
accepted in the United States for complete financial statements. See
Notes to Condensed Consolidated Financial Statements.
 2




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Wolverine Tube, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Cash Flows
  Three-month period ended:April 4, 2004
    
    March 30, 2003(In thousands)Operating ActivitiesNet income
    
    $
    1,368
    
    
    $
    638Adjustments to reconcile net income to net cash used
for operating activities:Depreciation and amortization
    
    
    4,668
    
    
    
    4,617Deferred income taxes
    
    
    9
    
    
    
    38Other non-cash items
    
    
    2,953
    
    
    
    83Changes in operating assets and liabilities:Accounts receivable, net
    
    
    (32,532
    )
    
    
    (18,887
    )Inventories
    
    
    (11,335
    )
    
    
    (8,014
    )Refundable income taxes
    
    
    (180
    )
    
    
    (954
    )Prepaid expenses and other
    
    
    (4,718
    )
    
    
    (1,595
    )Accounts payable
    
    
    14,964
    
    
    
    3,963Accrued liabilities including pension,
postretirement benefit and environmental
    
    
    (7,810
    )
    
    
    1,246Net cash used for operating activities
    
    
    (32,613
    )
    
    
    (18,865
    )Investing ActivitiesAdditions to property, plant and equipment
    
    
    (1,337
    )
    
    
    (872
    )Financing ActivitiesFinancing fees and expenses paid
    
    
    (86
    )
    
    
    (27
    )Net borrowings on revolving credit facilities
    
    
    20,000
    
    
    
    145Redemption of common stock
    
    
    (43
    )
    
    
    Other financing activities
    
    
    (186
    )
    
    
    Net cash provided by financing activities
    
    
    19,685
    
    
    
    118Effect of exchange rate on cash and equivalents
    
    
    (771
    )
    
    
    1,273Net cash used for continuing operations
    
    
    (15,036
    )
    
    
    (18,346
    )Net cash provided by (used for) discontinued operations
    
    
    552
    
    
    
    (408
    )Net decrease in cash and equivalents
    
    
    (14,484
    )
    
    
    (18,754
    )Cash and equivalents at beginning of period
    
    
    46,090
    
    
    
    53,920Cash and equivalents at end of period
    
    $
    31,606
    
    
    $
    35,166
 See Notes to Condensed Consolidated Financial Statements. 3




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Wolverine Tube, Inc. and Subsidiaries 
 Notes to Condensed Consolidated Financial Statements
 April 4, 2004
  NOTE 1. BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements include
the accounts of Wolverine Tube, Inc. (the Company) and its majority-owned
subsidiaries after elimination of significant intercompany accounts and
transactions. References to the Company, we or us refer to Wolverine
Tube, Inc. and its consolidated subsidiaries, unless the context otherwise
requires. The accompanying condensed consolidated financial statements have
been prepared in accordance with instructions to Form 10-Q and do not include
all the information and footnotes required by accounting principles generally
accepted in the United States for complete financial statements. The
accompanying condensed consolidated financial statements (and all information
in this report) have not been examined by independent auditors; but, in the
opinion of management, all adjustments, which consist of normal recurring
accruals necessary for a fair presentation of the results for the periods, have
been made. The results of operations for the three-month period ended April 4,
2004 is not necessarily indicative of the results of operations that may be
expected for the year ending December 31, 2004. For further information, refer
to the consolidated financial statements and notes included in our Annual
Report on Form 10-K for the year ended December 31, 2003. We use our internal operational reporting cycle for quarterly financial reporting. NOTE 2. CONTINGENCIES We are subject to extensive environmental regulations imposed by federal,
state, provincial and local authorities in the United States, Canada, China and
Portugal with respect to emissions to air, discharges to waterways, and the
generation, handling, storage, transportation, treatment and disposal of waste
materials, and we have received various communications from regulatory
authorities concerning environmental matters. We have accrued undiscounted
estimated environmental remediation costs of $1.1 million at April 4, 2004,
consisting primarily of $0.2 million for the Decatur, Alabama facility and $0.9
million for the Ardmore, Tennessee facility. Based on information currently
available, we believe that the ultimate costs for these matters are not
reasonably likely to have a material effect on our business, financial
condition or results of operations. However, actual costs related to
environmental matters could differ materially from the amounts we estimated and
accrued at April 4, 2004 and could result in additional exposure if these
environmental matters are not resolved as anticipated. 4




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NOTE 3. INVENTORIES Inventories are as follows: April 4, 2004
    
    December 31, 2003(In thousands)Finished products
    
    $
    36,221
    
    
    $
    34,082Work-in-process
    
    
    34,943
    
    
    
    27,484Raw materials
    
    
    19,994
    
    
    
    17,083Supplies
    
    
    27,203
    
    
    
    29,356Totals
    
    $
    118,361
    
    
    $
    108,005
 NOTE 4. CONSOLIDATED INTEREST EXPENSE, NET Consolidated interest expense is net of interest income and capitalized
interest of $97 thousand and $24 thousand, respectively, for the three-month
period ended April 4, 2004, and $151 thousand and $17 thousand, respectively,
for the three-month period ended March 30, 2003. NOTE 5. DEBT Long-term debt consists of the following: April 4, 2004
    
    December 31, 2003(In thousands)Secured Revolving Credit Facility
    
    $
    20,000
    
    
    
    Senior Notes, 10.5%, due April 2009
    
    
    118,000
    
    
    $
    118,000Discount on 10.5% Senior Notes, original
issue discount amortized over 7 years
    
    
    (1,018
    )
    
    
    (1,069
    )Senior Notes, 7.375%, due August 2008
    
    
    136,470
    
    
    
    136,308Discount on 7.375% Senior Notes, original
issue discount amortized over 10 years
    
    
    (125
    )
    
    
    (132
    )Netherlands facility, 4.625% due on demand
    
    
    1,022
    
    
    
    1,201Other foreign facilities
    
    
    1,440
    
    
    
    1,478275,789
    
    
    
    255,786Less short-term borrowings
    
    
    (1,315
    )
    
    
    (1,502
    )Totals
    
    $
    274,474
    
    
    $
    254,284
 As of April 4, 2004, we had borrowed $20.0 million under our secured revolving
credit facility. We had approximately $7.9 million of standby letters of
credit issued under the secured revolving credit facility and approximately
$9.6 million (subject to a $2.0 million excess availability requirement) in
additional borrowing availability thereunder. In October 2002, we completed an interest rate swap on $50 million notional
amount of our 7.375% Senior Notes. The interest rate swap resulted in a
reduction to interest expense in the first quarters of 2004 and 2003 of $280
thousand and $250 thousand, respectively. On March 31, 2004, the Company amended its secured revolving credit facility to
extend the term for an additional two years to March of 2007. In addition,
certain covenants were modified. Those covenants of significance which were
modified include lowering the Fixed Charge 5




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Coverage Ratios and the Minimum
Consolidated Earnings Before Interest, Taxes, Depreciation and Amortization
(EBITDA) and certain restrictions on the annual amount of capital
expenditures. NOTE 6. STOCK-BASED COMPENSATION PLANS We account for our stock option compensation plans using the intrinsic value
method prescribed in Accounting Principles Board Opinion No. 25, Accounting
for Stock Issued to Employees, and related interpretations. No stock option
compensation expense is reflected in net income because the exercise price of
our stock options equals the market price of the underlying stock on the date
of grant. The following table illustrates the effect on net income and
earnings per share if we had applied the fair value recognition provisions of
Statement of Financial Accounting Standards No. 123, Accounting for
Stock-Based Compensation to our stock option compensation plans. Three-month period ended:April 4, 2004
    
    March 30, 2003(In thousands, except per share amounts)Net income, as reported
    
    $
    1,368
    
    
    $
    638Deduct: Total stock-based employee
compensation expense determined
under fair value based method for
all awards, net of related
tax effects
    
    
    (56
    )
    
    
    (203
    )Pro forma net income
    
    $
    1,312
    
    
    $
    435Earnings per share:Basic  as reported
    
    $
    0.11
    
    
    $
    0.05Basic  pro forma
    
    $
    0.11
    
    
    $
    0.04Diluted  as reported
    
    $
    0.11
    
    
    $
    0.05Diluted  pro forma
    
    $
    0.11
    
    
    $
    0.04
 NOTE 7. COMPREHENSIVE INCOME Comprehensive income is as follows: Three-month period ended:April 4, 2004
    
    March 30, 2003(In thousands)Net income
    
    $
    1,368
    
    
    $
    638Translation adjustment for financial statements
denominated in a foreign currency
    
    
    (1,819
    )
    
    
    5,403Unrealized gain on cash flow hedges, net of tax
    
    
    2,816
    
    
    
    317Minimum pension liability adjustment, net of tax
    
    
    26
    
    
    
    (108
    )Comprehensive income
    
    $
    2,391
    
    
    $
    6,250
 6




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NOTE 8. RESTRUCTURING CHARGES In the third quarter of 2003, the Company announced its intention to close its
Booneville, Mississippi facility and did so in December of 2003. Accordingly,
the Company recorded a restructuring charge in the amount of $10.4 million and
established a reserve for certain items associated with the write-down of
impaired assets, relocation of equipment, severance and other people related
costs. Given the strong start to the 2004 HVAC cooling season and normal
seasonal demands, the Company is evaluating and testing the possibility of
using a limited number of assets at the Booneville, Mississippi facility to
provide additional capacity to meet increased demand. This is a temporary
measure that, if implemented, will occur through mid to late summer
2004 and does not change the Companys strategy regarding this facility. In
the fourth quarter of 2003, we charged $6.8 million against the reserve leaving
a balance in the reserve at December 31, 2003 of $3.5 million. In the first
quarter of 2004, we charged $3.2 million against the reserve, related to the
impaired assets, relocation of equipment, severance and other employee related
costs, the cost of terminating certain operating leases and preparing the
facility for sale, leaving a balance in the reserve at April 4, 2004 of $304
thousand for outstanding charges. Further, in accordance with FAS 146, regarding the Booneville, Mississippi
facility closure, the Company recognized restructuring expenses in the first
quarter of 2004 of $329 thousand, mostly costs related to maintaining the
facility, terminating leases and other costs associated with removing equipment
and preparing the facility for eventual sale. Also in the third quarter of 2003, the Company formalized a workforce reduction
program affecting approximately 200 employees. During the first quarter of
2004, in accordance with FAS 146, the Company recognized costs of $176 thousand
for severance, medical and other separation related expenditures associated
with this workforce reduction program. Finally, in the first quarter of 2004, the Company recognized charges of $46
thousand related to carrying costs and other closing related matters regarding
its closed Roxboro, North Carolina facility and $20 thousand in other
restructuring related issues. In total, in the first quarter of 2004 the Company recorded restructuring
expenses of $571 thousand pre-tax ($377 thousand net of tax). NOTE 9. INDUSTRY SEGMENTS Our reportable segments are based on our three product groups: commercial
products, wholesale products and rod, bar and other products. Commercial
products consist primarily of high value added products sold directly to
original equipment manufacturers. Wholesale products are commodity-type
plumbing tube products, which are primarily sold to plumbing wholesalers and
distributors. Rod, bar and other products consist of products sold to a
variety of customers and includes our European distribution business. We
evaluate the performance of our operating segments based on sales and gross
profit; however, we do not allocate asset amounts and items of income and
expense below gross profit or depreciation and amortization. 7




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Summarized financial information concerning our reportable segments is shown in
the following table: Rod, BarThree-month period ended
    
    Commercial
    
    Wholesale
    
    & Other
    
    Consolidated(In thousands)April 4, 2004Net sales
    
    $
    144,926
    
    
    $
    45,574
    
    
    $
    15,305
    
    
    $
    205,805Gross profit
    
    
    14,903
    
    
    
    1,746
    
    
    
    836
    
    
    
    17,485March 30, 2003Net sales
    
    $
    110,320
    
    
    $
    23,937
    
    
    $
    9,240
    
    
    $
    143,497Gross profit
    
    
    13,778
    
    
    
    64
    
    
    
    780
    
    
    
    14,622
 NOTE 10. EARNINGS PER SHARE The following table sets forth the computation of basic and diluted earnings
per share: Three-month period ended:April 4, 2004
    
    March 30, 2003(In thousands, except per share data)Net income
    
    $
    1,368
    
    
    $
    638Basic weighted average common shares
    
    
    12,289
    
    
    
    12,262Stock options and restricted shares
    
    
    245
    
    
    
    136Diluted weighted average common and
common equivalent shares
    
    
    12,534
    
    
    
    12,398Net income per common share  basic
    
    $
    0.11
    
    
    $
    0.05Net income per common share  diluted
    
    $
    0.11
    
    
    $
    0.05
 NOTE 11. DISCONTINUED OPERATIONS During the year ended December 31, 2001, we decided to discontinue the
operations of Wolverine Ratcliffs, Inc. (WRI), which were previously included
in the rod, bar and other products segment. Accordingly, the operating results
of WRI are reported in discontinued operations in the consolidated financial
statements. In 2002, we stopped all manufacturing operations of WRI,
liquidated substantially all of its inventory and net receivables and began
liquidating the equipment. In the first quarter of 2004, we sold the remainder
of the equipment for $0.8 million leaving only the land and building as assets
held for resale. We are currently evaluating the sale or lease of the land and
building and would like to conclude a transaction in 2004. There were no operating results of the discontinued WRI operations in the first
quarter of 2004 charged to the previously established reserves. There were
charges of $25 thousand related to sales returns in operations in the first
quarter of 2003. Assets and liabilities of the discontinued WRI operations have been reflected
in the consolidated balance sheets as current or non-current based on the
original classification of these accounts, net of any necessary valuation allowances, except that property, plant and
equipment to be disposed in the amount of $0.9 million, net of a necessary
valuation allowance, have been included in 8




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assets held for sale. Although we
believe we have appropriately reduced the carrying value of the assets to their
estimated recoverable amounts, net of disposal costs where appropriate, actual
results could be different and the difference will be reported in discontinued
operations in future periods. Net liabilities of the discontinued WRI operations are as follows: April 4, 2004
    
    December 31, 2003(In thousands)Assets held for sale
    
    
    908
    
    
    $
    1,697Other assets
    
    
    23
    
    
    
    26Current liabilities
    
    
    (957
    )
    
    
    (1,185
    )Other liabilities
    
    
    (1,077
    )
    
    
    (1,096
    )Net liabilities of discontinued operations
    
    $
    (1,103
    )
    
    $
    (558
    )
 Subsequent to April 4, 2004, the Other liabilities shown above, in the amount
of $1.1 million and $0.6 million of the Current liabilities were satisfied by
the purchase of annuity contracts equivalent to the net present value of WRIs
pension obligation for all covered employees. The total amount paid for the
annuity contracts was $1.7 million. NOTE 12. PENSION EXPENSE U.S. Qualified Retirement Plan A summary of the components of net periodic pension cost for the U.S.
Retirement Plan for the quarters ended April 4, 2004 and March 30, 2003 is as
follows: Three-month period ended:(In thousands)
    
    April 4, 2004
    
    March 30, 2003Service cost
    
    $
    1,135
    
    
    $
    960Interest cost
    
    
    2,393
    
    
    
    2,214Expected return on plan assets
    
    
    (2,799
    )
    
    
    (2,434
    )Amortization of prior service cost
    
    
    30
    
    
    
    33Amortization of net actuarial loss
    
    
    341
    
    
    
    267Effect of curtailment
    
    
    
    
    
    
    25PBGC Premium (underfunded plan)
    
    
    58
    
    
    
    Net periodic pension cost
    
    $
    1,158
    
    
    $
    1,065
 9




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U.S. Nonqualified Retirement Plan A summary of the components of net periodic pension cost for the Supplemental
Benefit Restoration Plan and the Supplemental Executive Retirement Plan for the
quarters ended April 4, 2004 and March 30, 2003 is as follows: Three-month period ended:(In thousands)
    
    April 4, 2004
    
    March 30, 2003Service cost
    
    $
    48
    
    
    $
    37Interest cost
    
    
    115
    
    
    
    104Amortization of prior service cost
    
    
    92
    
    
    
    89Net periodic pension cost
    
    $
    255
    
    
    $
    230
 Canadian Plans A summary of the components of net periodic pension cost for the Canadian
pension plans for the years ended December 31 are as follows: Three-month period ended:(In thousands)
    
    April 4, 2004
    
    March 30, 2003Service cost
    
    $
    150
    
    
    $
    94Interest cost
    
    
    357
    
    
    
    227Expected return on plan assets
    
    
    (325
    )
    
    
    (206
    )Amortization of prior service cost
    
    
    25
    
    
    
    15Amortization of net actuarial loss
    
    
    44
    
    
    
    19Net periodic pension cost
    
    $
    251
    
    
    $
    149
 Postretirement benefit obligation A summary of the components of net periodic expense for the postretirement
benefit cost for the quarters ended April 4, 2004 and March 30, 2003 is as
follows: Three-month period ended:(In thousands)
    
    April 4, 2004
    
    March 30, 2003Service cost
    
    $
    183
    
    
    $
    135Interest cost
    
    
    255
    
    
    
    210Amortization of prior service cost
    
    
    38
    
    
    
    28Amortization of deferred gain
    
    
    5
    
    
    
    (16
    )Effect of special termination benefits
    
    
    
    
    
    
    19Effect of curtailment
    
    
    
    
    
    
    4Net periodic pension cost
    
    $
    481
    
    
    $
    380
 On December 8, 2003, a law adding a prescription drug benefit for
Medicare-eligible retirees beginning in 2006 was adopted. We anticipate that
the benefit we will be required to pay in 2006 will be lower as a result of the
new Medicare provision. However, the retiree medical costs
reported above does not reflect the impact of this legislation. Deferring the
recognition of the new Medicare provisions impact is permitted by Financial
Accounting Standard Board Staff 10




---



##### Table of Contents



Position 106-1 due to open questions about
certain matters. The final guidance could require changes to previously
reported information. NOTE 13. CONDENSED CONSOLIDATING FINANCIAL INFORMATION The following tables present condensed consolidating financial information for:
(a) Wolverine Tube, Inc. (the Parent) on a stand-alone basis; (b) on a
combined basis, the guarantors of the 10.5% Senior Notes and 7.375% Senior
Notes (Subsidiary Guarantors), which include TF Investor, Inc.; Tube Forming,
L.P.; Wolverine Finance, LLC; Wolverine China Investments, LLC; Small Tube
Manufacturing, LLC; Wolverine Joining Technologies, LLC; WT Holding Company,
Inc. and Tube Forming Holdings, Inc.; and (c) on a combined basis, the
Non-Guarantor Subsidiaries, which include Wolverine Tube (Canada) Inc.; 3072452
Nova Scotia Company; 3072453 Nova Scotia Company; 3072996 Nova Scotia Company;
Wolverine Tube Canada Limited Partnership; Wolverine Tube (Shanghai) Limited;
Wolverine European Holdings BV; Wolverine Tube Europe BV; Wolverine Tube, BV;
Wolverine Tubagem (Portugal), Lda; Wolverine Joining Technologies Canada, Inc.;
Wolverine Europe (EURL); and Wolverine Asia Limited. Each of the Subsidiary
Guarantors is wholly-owned by Wolverine Tube, Inc. The guarantees issued by
each of the Subsidiary Guarantors are full, unconditional, joint and several.
Accordingly, separate financial statements of the wholly-owned Subsidiary
Guarantors are not presented because the Subsidiary Guarantors are jointly,
severally and unconditionally liable under the guarantees, and we believe
separate financial statements and other disclosures regarding the Subsidiary
Guarantors are not material to investors. Furthermore, there are no
significant legal restrictions on the Parents ability to obtain funds from its
subsidiaries by dividend or loan. The Parent is comprised of Alabama, Oklahoma, Tennessee, and Mississippi
manufacturing operations and certain corporate management, sales and marketing,
information services and finance functions.  11




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##### Table of Contents



Wolverine Tube, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
For the Three Months Ended April 4, 2004 (Unaudited) Subsidiary
    
    Non-GuarantorParent
    
    Guarantors
    
    Subsidiaries
    
    Eliminations
    
    Consolidated(In thousands)Net sales
    
    $
    109,005
    
    
    $
    41,920
    
    
    $
    70,595
    
    
    $
    (15,715
    )
    
    $
    205,805Cost of goods sold
    
    
    102,725
    
    
    
    35,431
    
    
    
    65,879
    
    
    
    (15,715
    )
    
    
    188,320Gross profit
    
    
    6,280
    
    
    
    6,489
    
    
    
    4,716
    
    
    
    
    
    
    
    17,485Selling, general and administrative expenses
    
    
    7,549
    
    
    
    767
    
    
    
    1,121
    
    
    
    
    
    
    
    9,437Restructuring charges
    
    
    571
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    571Income (loss) from operations
    
    
    (1,840
    )
    
    
    5,722
    
    
    
    3,595
    
    
    
    
    
    
    
    7,477Other (income) expenses:Interest expense, net
    
    
    5,212
    
    
    
    (10
    )
    
    
    (132
    )
    
    
    
    
    
    
    5,070Amortization and other, net
    
    
    3,030
    
    
    
    (3,294
    )
    
    
    932
    
    
    
    
    
    
    
    668Income (loss) before income taxes
    
    
    (10,082
    )
    
    
    9,026
    
    
    
    2,795
    
    
    
    
    
    
    
    1,739Income tax provision (benefit)
    
    
    (3,435
    )
    
    
    3,255
    
    
    
    551
    
    
    
    
    
    
    
    371Income (loss) net of tax
    
    
    (6,647
    )
    
    
    5,771
    
    
    
    2,244
    
    
    
    
    
    
    
    1,368Equity in earnings of subsidiaries
    
    
    8,015
    
    
    
    
    
    
    
    
    
    
    
    (8,015
    )
    
    
    Net income
    
    $
    1,368
    
    
    $
    5,771
    
    
    $
    2,244
    
    
    $
    (8,015
    )
    
    $
    1,368
 Wolverine Tube, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
For the Three Months Ended March 30, 2003 (Unaudited) Subsidiary
    
    Non-GuarantorParent
    
    Guarantors
    
    Subsidiaries
    
    Eliminations
    
    Consolidated(In thousands)Net sales
    
    $
    76,763
    
    
    $
    32,479
    
    
    $
    46,030
    
    
    $
    (11,775
    )
    
    $
    143,497Cost of goods sold
    
    
    71,328
    
    
    
    27,858
    
    
    
    41,464
    
    
    
    (11,775
    )
    
    
    128,875Gross profit
    
    
    5,435
    
    
    
    4,621
    
    
    
    4,566
    
    
    
    
    
    
    
    14,622Selling, general and administrative expenses
    
    
    6,310
    
    
    
    800
    
    
    
    1,032
    
    
    
    
    
    
    
    8,142Operating income (loss)
    
    
    (875
    )
    
    
    3,821
    
    
    
    3,534
    
    
    
    
    
    
    
    6,480Other (income) expenses:Interest expense, net
    
    
    5,257
    
    
    
    (3
    )
    
    
    (76
    )
    
    
    
    
    
    
    5,178Amortization and other, net
    
    
    2,169
    
    
    
    (2,988
    )
    
    
    1,361
    
    
    
    
    
    
    
    542Income (loss) before income taxes
    
    
    (8,301
    )
    
    
    6,812
    
    
    
    2,249
    
    
    
    
    
    
    
    760Income tax provision (benefit)
    
    
    (2,783
    )
    
    
    2,496
    
    
    
    409
    
    
    
    
    
    
    
    122Income (loss) net of tax
    
    
    (5,518
    )
    
    
    4,316
    
    
    
    1,840
    
    
    
    
    
    
    
    638Equity in earnings of subsidiaries
    
    
    6,156
    
    
    
    
    
    
    
    
    
    
    
    (6,156
    )
    
    
    Net income
    
    $
    638
    
    
    $
    4,316
    
    
    $
    1,840
    
    
    $
    (6,156
    )
    
    $
    638
 12




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##### Table of Contents



Wolverine Tube, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
April 4, 2004 (Unaudited) Subsidiary
    
    Non-GuarantorParent
    
    Guarantors
    
    Subsidiaries
    
    Eliminations
    
    Consolidated(In thousands)AssetsCurrent assetsCash and equivalents
    
    $
    7,309
    
    
    $
    
    
    
    $
    24,297
    
    
    $
    
    
    
    $
    31,606Accounts receivable, net
    
    
    7,206
    
    
    
    75,841
    
    
    
    36,054
    
    
    
    
    
    
    
    119,101Inventories
    
    
    52,103
    
    
    
    36,073
    
    
    
    30,185
    
    
    
    
    
    
    
    118,361Prepaid expenses and other
    
    
    14,702
    
    
    
    1,472
    
    
    
    293
    
    
    
    
    
    
    
    16,467Total current assets
    
    
    81,320
    
    
    
    113,386
    
    
    
    90,829
    
    
    
    
    
    
    
    285,535Property, plant and equipment, net
    
    
    125,364
    
    
    
    29,844
    
    
    
    39,696
    
    
    
    
    
    
    
    194,904Deferred charges, net
    
    
    12,794
    
    
    
    257
    
    
    
    2,399
    
    
    
    
    
    
    
    15,450Goodwill, net
    
    
    
    
    
    
    75,504
    
    
    
    1,629
    
    
    
    
    
    
    
    77,133Assets held for sale
    
    
    3,100
    
    
    
    
    
    
    
    908
    
    
    
    
    
    
    
    4,008Prepaid pensions and other
    
    
    4,292
    
    
    
    
    
    
    
    73
    
    
    
    
    
    
    
    4,365Investments in subsidiaries
    
    
    416,019
    
    
    
    302
    
    
    
    
    
    
    
    (416,321
    )
    
    
    Total assets
    
    $
    642,889
    
    
    $
    219,293
    
    
    $
    135,534
    
    
    $
    (416,321
    )
    
    $
    581,395Liabilities and Stockholders EquityCurrent liabilitiesAccounts payable
    
    $
    27,072
    
    
    $
    17,227
    
    
    $
    18,189
    
    
    $
    
    
    
    $
    62,488Accrued liabilities
    
    
    2,146
    
    
    
    9,669
    
    
    
    7,569
    
    
    
    
    
    
    
    19,384Short-term borrowings
    
    
    
    
    
    
    
    
    
    
    1,315
    
    
    
    
    
    
    
    1,315Intercompany balances
    
    
    124,016
    
    
    
    (111,052
    )
    
    
    (12,964
    )
    
    
    
    
    
    
    Total current liabilities
    
    
    153,234
    
    
    
    (84,156
    )
    
    
    14,109
    
    
    
    
    
    
    
    83,187Deferred income taxes
    
    
    3,098
    
    
    
    7,385
    
    
    
    (9,945
    )
    
    
    
    
    
    
    538Long-term debt
    
    
    273,326
    
    
    
    
    
    
    
    1,148
    
    
    
    
    
    
    
    274,474Pension liabilities
    
    
    19,938
    
    
    
    
    
    
    
    3,369
    
    
    
    
    
    
    
    23,307Postretirement benefit obligation
    
    
    10,404
    
    
    
    
    
    
    
    6,586
    
    
    
    
    
    
    
    16,990Accrued environmental remediation
    
    
    1,110
    
    
    
    
    
    
    
    9
    
    
    
    
    
    
    
    1,119Total liabilities
    
    
    461,110
    
    
    
    (76,771
    )
    
    
    15,276
    
    
    
    
    
    
    
    399,615Stockholders equity
    
    
    181,779
    
    
    
    296,064
    
    
    
    120,258
    
    
    
    (416,321
    )
    
    
    181,780Total liabilities and stockholders equity
    
    $
    642,889
    
    
    $
    219,293
    
    
    $
    135,534
    
    
    $
    (416,321
    )
    
    $
    581,395
 13




---



##### Table of Contents



Wolverine Tube, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
December 31, 2003 Subsidiary
    
    Non-GuarantorParent
    
    Guarantors
    
    Subsidiaries
    
    Eliminations
    
    Consolidated(In thousands)AssetsCurrent assetsCash and equivalents
    
    $
    8,530
    
    
    $
    
    
    
    $
    37,559
    
    
    $
    
    
    
    $
    46,089Accounts receivable, net
    
    
    7,119
    
    
    
    54,931
    
    
    
    24,775
    
    
    
    
    
    
    
    86,825Inventories
    
    
    45,833
    
    
    
    33,139
    
    
    
    29,033
    
    
    
    
    
    
    
    108,005Prepaid expenses and other
    
    
    12,156
    
    
    
    408
    
    
    
    218
    
    
    
    
    
    
    
    12,782Total current assets
    
    
    73,638
    
    
    
    88,478
    
    
    
    91,585
    
    
    
    
    
    
    
    253,701Property, plant and equipment, net
    
    
    126,642
    
    
    
    30,838
    
    
    
    41,062
    
    
    
    
    
    
    
    198,542Deferred charges, net
    
    
    13,087
    
    
    
    291
    
    
    
    1,392
    
    
    
    
    
    
    
    14,770Goodwill, net
    
    
    
    
    
    
    75,505
    
    
    
    1,654
    
    
    
    
    
    
    
    77,159Assets held for sale
    
    
    3,100
    
    
    
    
    
    
    
    1,697
    
    
    
    
    
    
    
    4,797Investments
    
    
    4,289
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,289Investments in subsidiaries
    
    
    409,796
    
    
    
    302
    
    
    
    
    
    
    
    (410,098
    )
    
    
    Total assets
    
    $
    630,552
    
    
    $
    195,414
    
    
    $
    137,390
    
    
    $
    (410,098
    )
    
    $
    553,258Liabilities and Stockholders EquityCurrent liabilitiesAccounts payable
    
    $
    17,813
    
    
    $
    12,966
    
    
    $
    16,724
    
    
    $
    
    
    
    $
    47,503Accrued liabilities
    
    
    15,441
    
    
    
    8,073
    
    
    
    6,273
    
    
    
    
    
    
    
    29,787Short-term borrowings
    
    
    
    
    
    
    
    
    
    
    1,502
    
    
    
    
    
    
    
    1,502Intercompany balances
    
    
    131,590
    
    
    
    (123,304
    )
    
    
    (8,286
    )
    
    
    
    
    
    
    Total current liabilities
    
    
    164,844
    
    
    
    (102,265
    )
    
    
    16,213
    
    
    
    
    
    
    
    78,792Deferred income taxes
    
    
    3,098
    
    
    
    7,385
    
    
    
    (10,124
    )
    
    
    
    
    
    
    359Long-term debt
    
    
    253,107
    
    
    
    
    
    
    
    1,177
    
    
    
    
    
    
    
    254,284Pension liabilities
    
    
    18,594
    
    
    
    
    
    
    
    3,722
    
    
    
    
    
    
    
    22,316Postretirement benefit obligation
    
    
    10,406
    
    
    
    
    
    
    
    6,589
    
    
    
    
    
    
    
    16,995Accrued environmental remediation
    
    
    1,152
    
    
    
    
    
    
    
    9
    
    
    
    
    
    
    
    1,161Total liabilities
    
    
    451,201
    
    
    
    (94,880
    )
    
    
    17,586
    
    
    
    
    
    
    
    373,907Stockholders equity
    
    
    179,351
    
    
    
    290,294
    
    
    
    119,804
    
    
    
    (410,098
    )
    
    
    179,351Total liabilities and stockholders equity
    
    $
    630,552
    
    
    $
    195,414
    
    
    $
    137,390
    
    
    $
    (410,098
    )
    
    $
    553,258
 14




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##### Table of Contents



Wolverine Tube, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
For the Three Months ended April 4, 2004 (Unaudited) Subsidiary
    
    Non-GuarantorParent
    
    Guarantors
    
    Subsidiaries
    
    Eliminations
    
    Consolidated(In thousands)Operating ActivitiesNet income (loss)
    
    $
    1,368
    
    
    $
    5,770
    
    
    $
    2,245
    
    
    $
    (8,015
    )
    
    $
    1,368Depreciation and amortization
    
    
    2,963
    
    
    
    901
    
    
    
    804
    
    
    
    
    
    
    
    4,668Other non-cash items
    
    
    2,938
    
    
    
    15
    
    
    
    9
    
    
    
    
    
    
    
    2,962Equity in earnings of subsidiaries
    
    
    (8,015
    )
    
    
    
    
    
    
    
    
    
    
    8,015
    
    
    
    Changes in operating assets and liabilities
    
    
    (11,525
    )
    
    
    (19,031
    )
    
    
    (11,055
    )
    
    
    
    
    
    
    (41,611
    )Net cash (used for) provided by operating activities
    
    
    (12,271
    )
    
    
    (12,345
    )
    
    
    (7,997
    )
    
    
    
    
    
    
    (32,613
    )Investing ActivitiesAdditions to property, plant and equipment
    
    
    (1,255
    )
    
    
    (176
    )
    
    
    (176
    )
    
    
    
    
    
    
    (1,337
    )Financing ActivitiesFinancing fees and expenses paid
    
    
    (86
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (86
    )Net borrowings (payments) on revolving credit
facilities
    
    
    20,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,000Intercompany borrowings (payments)
    
    
    (7,692
    )
    
    
    12,790
    
    
    
    (5,098
    )
    
    
    
    
    
    
    Issuance of common stock
    
    
    (43
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (43
    )Other financing activities
    
    
    531
    
    
    
    (531
    )
    
    
    (186
    )
    
    
    
    
    
    
    (186
    )Net cash provided by (used for) financing activities
    
    
    12,710
    
    
    
    12,259
    
    
    
    (5,284
    )
    
    
    
    
    
    
    19,685Effect of exchange rate on cash and equivalents
    
    
    (413
    )
    
    
    
    
    
    
    (358
    )
    
    
    
    
    
    
    (771
    )Net cash (used for) provided by continuing
operations
    
    
    (1,229
    )
    
    
    8
    
    
    
    (13,815
    )
    
    
    
    
    
    
    (15,036
    )Net cash provided by discontinued operations
    
    
    
    
    
    
    
    
    
    
    552
    
    
    
    
    
    
    
    552Net (decrease) increase in cash and equivalents
    
    
    (1,229
    )
    
    
    8
    
    
    
    (13,263
    )
    
    
    
    
    
    
    (14,484
    )Cash and equivalents at beginning of period
    
    
    8,536
    
    
    
    (6
    )
    
    
    37,560
    
    
    
    
    
    
    
    46,090Cash and equivalents at end of period
    
    $
    7,307
    
    
    $
    2
    
    
    $
    24,297
    
    
    $
    
    
    
    $
    31,606
 15




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##### Table of Contents



Wolverine Tube, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
For the Three Months ended March 30, 2003 (Unaudited) Subsidiary
    
    Non-GuarantorParent
    
    Guarantors
    
    Subsidiaries
    
    Eliminations
    
    Consolidated(In thousands)Operating ActivitiesNet income (loss)
    
    $
    638
    
    
    $
    4,316
    
    
    $
    1,840
    
    
    $
    (6,156
    )
    
    $
    638Depreciation and amortization
    
    
    3,056
    
    
    
    857
    
    
    
    704
    
    
    
    
    
    
    
    4,617Other non-cash items
    
    
    73
    
    
    
    10
    
    
    
    38
    
    
    
    
    
    
    
    121Equity in earnings of subsidiaries
    
    
    (6,156
    )
    
    
    
    
    
    
    
    
    
    
    6,156
    
    
    
    Changes in operating assets and liabilities
    
    
    (7,060
    )
    
    
    (12,274
    )
    
    
    (4,907
    )
    
    
    
    
    
    
    (24,241
    )Net cash used for operating activities
    
    
    (9,449
    )
    
    
    (7,091
    )
    
    
    (2,325
    )
    
    
    
    
    
    
    (18,865
    )Investing ActivitiesAdditions to property, plant and equipment
    
    
    (486
    )
    
    
    (143
    )
    
    
    (243
    )
    
    
    
    
    
    
    (872
    )Financing ActivitiesFinancing fees and expenses paid
    
    
    (27
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (27
    )Net borrowings (payments) on revolving credit
facilities
    
    
    (392
    )
    
    
    392
    
    
    
    145
    
    
    
    
    
    
    
    145Intercompany borrowings (payments)
    
    
    (323
    )
    
    
    6,842
    
    
    
    (6,519
    )
    
    
    
    
    
    
    Net cash provided by (used for) financing activities
    
    
    (742
    )
    
    
    7,234
    
    
    
    (6,374
    )
    
    
    
    
    
    
    118Effect of exchange rate on cash and equivalents
    
    
    
    
    
    
    
    
    
    
    1,273
    
    
    
    
    
    
    
    1,273Net cash used for continuing operations
    
    
    (10,677
    )
    
    
    
    
    
    
    (7,669
    )
    
    
    
    
    
    
    (18,346
    )Net cash used for discontinued operations
    
    
    
    
    
    
    
    
    
    
    (408
    )
    
    
    
    
    
    
    (408
    )Net decrease in cash and equivalents
    
    
    (10,677
    )
    
    
    
    
    
    
    (8,077
    )
    
    
    
    
    
    
    (18,754
    )Cash and equivalents at beginning of period
    
    
    22,461
    
    
    
    
    
    
    
    31,459
    
    
    
    
    
    
    
    53,920Cash and equivalents at end of period
    
    $
    11,784
    
    
    $
    
    
    
    $
    23,382
    
    
    $
    
    
    
    $
    35,166
 16




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ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following is a discussion of our results of operations and financial
condition. This discussion should be read in conjunction with our Condensed
Consolidated Financial Statements and notes thereto. OVERVIEW In the first quarter of 2004, we experienced a steady improvement in all of our
business segments as the overall business environment strengthened. For the
quarter, net income was $1.4 million or $0.11 per diluted share compared with
net income of $0.6 million or $0.05 per diluted share in the first quarter of
2003. This improvement includes $0.4 million (net of tax) or $0.03 per share
of restructuring charges. These charges relate mostly to the previously
announced Booneville, Mississippi facility closure and workforce reduction
program. Several favorable factors, some external to Wolverine and some internal to the
Company, were the main drivers for this improvement. Clearly, a strengthening
business environment translated into stronger results, given our strong market
and global positions. Our wholesale market strategy has resulted in expanded
distribution channels in the United States and allowed us to maintain our
strong Canadian market position. Growth in commercial construction, in both
the United States and Canada, provided for increased demand and improved
pricing in the commodity product segment. The continuing trend to outsource non-core manufacturing processes by our
original equipment manufacturer customer base is spurring strong growth in our
fabricated products business. Wolverines geographic expansion has resulted in
increased sales not only to our North American customers with operations in
Asia and Europe, but also to customers indigenous to those geographies, which
we have not previously been able to service. We have achieved improvements in manufacturing efficiencies and productivity,
although they are masked by the strong Canadian dollar and the translation
impact that this has on our reported cost to manufacture. The translation
impact of the weaker U.S. dollar versus the Canadian dollar increased our
reported cost by $2.4 million, while our revenue increased $1.2 million, as
approximately fifty percent of the products manufactured in our Canadian
operations are sold into the United States and are denominated in U.S. dollars. Looking ahead, we believe that the second quarter of 2004 will show a sharp
improvement over the second quarter of 2003, as well as an improvement versus
the first quarter of this year. While the second quarter is normally our
seasonal strongest quarter, the forecasted improvement also reflects the
benefits of our strong global market presence, with continued market
penetration in many of our product segments. Operations are performing well
and we anticipate a benefit from a renewed customer focus on technology and
desire for newer products. We will continue to be challenged by metal markets
that are volatile and result in higher premiums over COMEX, for raw material,
and the relatively strong Canadian dollar. 17




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RESULTS OF OPERATIONS Three-Month Period Ended April 4, 2004 Compared to
Three-Month Period Ended March 30, 2003 Consolidated net sales increased by $62.3 million, or 43.4%, to $205.8 million
for the first quarter ended April 4, 2004 from $143.5 million for the quarter
ended March 30, 2003. This growth is due to increased volumes shipped, higher
COMEX copper and other metal prices, and improved pricing, especially in the
wholesale product segment. Pounds shipped increased by 12.4 million pounds, or
15.3%, to 93.4 million in the first quarter of 2004 from 81.0 million in the
first quarter of 2003. The average COMEX copper price for the first quarter of
2004 was $1.23 per pound, as compared to $0.76 per pound in the first quarter
of 2003, an increase of approximately 62%. Pounds of commercial products shipped increased by 4.9 million pounds, or 8.7%,
to 61.1 million in the first quarter of 2004 from 56.2 million in the first
quarter of 2003. This increase is due to volume growth in all of our
commercial products as we have benefited from the recovering North American
economy, our global market expansion, increase in commercial construction and a
robust start to the 2004 HVAC cooling season. Sales of commercial products
increased $34.6 million, or 31.4%, to $144.9 million in the first quarter of
2004 from $110.3 million in 2003. The improvement in net sales reflects the
previously mentioned volume change, the sharp rise in metal prices and an
improvement in fabrication revenues (defined as net sales less the selling
price of the metal) due to mix and price increases. In our commercial segment,
COMEX copper prices are generally a pass through to our customers. Revenue per
pound for commercial products was $2.37 per pound in the first quarter of 2004,
compared to $1.96 per pound in 2003, reflecting primarily the sharp rise in
metal prices and to a lesser extent, an improvement in fabrication revenues as
mentioned above. Gross profit for commercial products increased by $1.1
million, or 8.2%, to $14.9 million in the first quarter of 2004 from $13.8
million in 2003, attributable to higher volumes and improved selling prices
offset slightly by higher manufacturing cost due to richer mix and the
unfavorable Canadian currency translation impact on manufacturing costs. Pounds of wholesale products shipped increased by 5.9 million pounds, or 29.5%,
to 25.9 million in the first quarter of 2004 from 20.0 million in 2003 due to
our expanded channels to this commodity market as well as improvements in
demand in both the United States and Canada with increased commercial
construction. Sales of wholesale products increased $21.6 million, or 90.4%,
to $45.6 million in the first quarter of 2004 from $23.9 million in 2003, due
to rising COMEX prices, as well as a 45.3% increase in fabrication revenues.
As a result, revenue per pound was up $0.56 to $1.76 in the first quarter of
2004 versus $1.20 in the first quarter of 2003. Gross profit for wholesale
products increased approximately 27 times from $64 thousand in the comparable
quarter of 2003 to $1.7 million in the first quarter of 2004. This substantial
improvement is principally due to increased demand and better pricing. Pounds of rod and bar products shipped increased by 1.6 million pounds, or
33.3%, to 6.4 million in the first quarter of 2004 from 4.8 million in 2003 as
we have gained market share in this segment from one competitor who exited a
portion of this market. Sales of rod, bar and other products increased $6.1
million, or 66.3%, to $15.3 million in the first quarter of 2004. Other
products are primarily those products sold from our distribution center in The
Netherlands whose sales dollars increased approximately $1.2 million in the
first quarter of 2004 due to increased volume and a stronger quarter over
quarter Euro. Gross profit for rod, bar and other 18




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products increased $56 thousand, or 7.2%, to $836 thousand in the first quarter of 2004 from $780
thousand in 2003, due to increased volumes, pricing and the favorable impact of
the stronger Euro compared to the first quarter of the prior year, offsetting
the unfavorable Canadian currency translation impact on manufacturing costs of
rod and bar. Consolidated gross profit increased $2.9 million or 19.9% to $17.5 million in
the first quarter of 2004 from $14.6 million in 2003. In addition to a richer
mix, stronger North American economies and global expansion, volume, price and
manufacturing efficiencies favorably impacted gross profit. Negatively
impacting gross profit was the strong Canadian dollar versus the U.S. dollar
and its influence on the cost of manufacturing in Canada. In comparing year
over year, manufacturing costs were impacted negatively by $2.4 million due to
the strong Canadian dollar. Also, our metal and hedge accounting provided a
favorable pre-tax impact of $700 thousand dollars and we began to realize the
benefits from the closing of our Booneville, Mississippi facility. Our
manufacturing cost per pound for the quarter, including the impact of a richer
mix, increased $.02 per pound to $.83 per pound in the first quarter of 2004
which includes the aforementioned $2.4 million or $.03 per pound currency
translation impact as compared to $0.81 per pound in the first quarter of 2003. Consolidated selling, general and administrative expenses for the first quarter
of 2004 increased by $1.3 million, or 16.0%, to $9.4 million compared with $8.1
million in 2003. The $1.3 million increase is due to higher professional fees
principally related to compliance with the Sarbanes Oxley Act of 2002,
including meeting Section 404, required of all publicly listed companies.
Additionally, selling, general and administrative expenses increased as a
result of incentive compensation accruals being driven by improved operating
results and higher pension expense, due to the actuarial impact of reduced
discount rates. These increases more than offset the positive impact of
restructuring which occurred in the fourth quarter of 2003 and carried over
into the first quarter of 2004. Consolidated net interest expense decreased by $0.1 million or 1.9%, to $5.1
million in the first quarter of 2004 from $5.2 million in 2003. Consolidated
net interest expense is net of interest income and capitalized interest of $97
thousand and $24 thousand, respectively, for the three-month period ended April
4, 2004 and $151 thousand and $17 thousand, respectively, for the three-month
period ended March 30, 2003. Amortization and other was $0.7 million of expense in the first quarter of 2004
compared to $0.5 million of expense in the first quarter of 2003. Amortization
and other in both the first quarter of 2003 and 2004 included $0.1 million of
foreign currency losses primarily associated with the fluctuation in the
Canadian to U.S. dollar exchange rate. Amortization expense, primarily
deferred financing fees, was $0.4 million in the first quarter of both 2004 and
2003. In the first quarter of 2004, an uncollectible miscellaneous receivable
was written off amounting to $0.1 million. The effective tax rate for the first quarter of 2004 was 21.3% compared to
16.1% in the first quarter of 2003. The effective tax rate recorded in the
first quarter of 2004 versus the first quarter of the prior year reflects
pre-tax income increases in higher tax jurisdictions in 2004. The effective
tax rate in the first quarter of 2003 reflects benefits from state tax planning
activities as well as tax benefits generated in higher effective tax rate
jurisdictions, which had pre-tax losses versus income generated in
jurisdictions where the tax rates are lower. The benefits derived from 19




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the state tax planning activities reduced the effective tax rate in the first
quarter of 2003 by approximately 15 percentage points. Liquidity and Capital Resources The primary source of our liquidity for the first quarter ended April 4, 2004
was cash on hand at the beginning of the year of $46.1 million and $20.0
million borrowed under the Companys secured revolving credit facility. The
primary uses of our funds for the three months ended April 4, 2004 were $32.6
million for continuing operations and $1.3 million for investments in our
property, plant and equipment. The primary source of our liquidity for the first quarter ended March 30, 2003
was cash on hand at the beginning of the year. The primary uses of our funds
for the first quarter of 2003 were $18.9 million for continuing operations and
$0.9 million for investments in our property, plant and equipment. Net cash used by continuing operating activities was $32.6 million for the
first quarter of 2004 and $18.9 million for the first quarter of 2003. We
participate in a seasonal business which typically produces greater sales in
the first and second quarters compared to the second half of the year, and thus
we tend to use cash in the first part of the year and generate cash in the
latter part of the year. Additionally, the timing of our quarter end on April
4, 2004, resulted in two interest payments recorded in the first quarter of
2004 of $11.2 million versus only one such payment of $5.5 million in the first
quarter of 2003. The increase in cash used for operating activities in the
first quarter of 2004 as compared to 2003 was primarily the result of a
significant rise in metal prices, impacting accounts receivable, inventories
and accounts payable. As of April 4, 2004, we had borrowed $20.0 million under our secured revolving
credit facility. We had approximately $7.9 million of standby letters of
credit issued under the secured revolving credit facility and approximately
$9.6 million (subject to a $2.0 million excess availability requirement) in
additional borrowing availability thereunder. Capital expenditures were $1.3 million in the first quarter of 2004 as compared
to $0.9 million in the first quarter of 2003. We currently expect to spend
between $10.5 million and $12.0 million for capital items in the year 2004.
Our capital expenditures include asset replacement, environmental compliance
and cost reduction and productivity improvement items. The ratio of current assets to current liabilities was 3.4 to 1 at April 4,
2004 and 4.1 to 1 at March 30, 2003. Our cash and cash equivalent balances as
of April 4, 2004 and December 31, 2003 were $31.6 million and $46.1 million,
respectively, of which $24.2 million and $37.4 million, respectively, were held
by our subsidiaries located outside of the United States. We believe we
would have to pay the differential between foreign taxes and United States
taxes on funds located outside of the United States upon repatriating these
funds to the United States. However, we do not anticipate repatriating these
funds in the foreseeable future and accordingly have not accrued the
differential tax liability. We believe that with the continuing borrowing availability anticipated under
our secured revolving credit facility, our cash balances and anticipated cash
flow from our continuing 20




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operations, we will be able to satisfy our existing
working capital needs, interest obligations and capital expenditure
requirements. Environmental Matters Our facilities and operations are subject to extensive environmental laws and
regulations. During the first quarter ended April 4, 2004, we spent
approximately $43 thousand on environmental matters, which included
remediation, monitoring, legal and other costs. We have a reserve of $1.1
million for undiscounted environmental remediation costs which is reflected in
our Condensed Consolidated Balance Sheet. Based on currently available
information, we believe that the ultimate costs of the environmental matters
described below are not reasonably likely to have a material adverse effect on
our business, financial condition or results of operations. However, actual
costs related to environmental matters could differ materially from the amounts
we estimated and accrued at April 4, 2004 and could result in additional
exposure if these environmental matters are not resolved as anticipated. Decatur, Alabama In 1999, the Company entered into Consent Order under Section 3008(h) of the
Resource Conservation and Recovery Act. This order incorporated the Corrective
Measures Study, commonly referred to as the CMS, submitted to the Environmental
Protection Agency (the EPA) regarding a waste burial site at the Decatur,
Alabama facility. The order also included an upgrade to an existing chrome
ground water remediation system. Part of the ground water contamination plume had previously been detected
underneath a section of property not owned by us. In December 2002, we took a
sample from the adjoining property that indicated there were no longer
detectable levels of chrome beyond our property boundary. We believe, due to
our remediation efforts, this plume has retracted due to treatment and will
continue to do so. In July of 2000, we notified the EPA and the Alabama Department of
Environmental Management that we detected low levels of volatile organic
compounds and petroleum hydrocarbons in the ground water at the Decatur,
Alabama facility detected during the expansion of the facility. On June 13,
2001, we received a letter from the Alabama Department of Environmental
Management stating that a preliminary assessment would be forthcoming, but no
further action has occurred to date. When the assessment is conducted, we
will, if appropriate and necessary, increase the reserve for any additional
costs once the extent of the actions needed to be taken are defined. The estimated remaining assessment, monitoring, remedial, legal, and other
costs related to the environmental matters at our Decatur, Alabama facility are
$0.2 million as of April 4, 2004. Ardmore, Tennessee On December 28, 1995, we entered into a Consent Order and Agreement with the
Tennessee Division of Superfund, or Tennessee Division, relating to the
Ardmore, Tennessee facility, under which we agreed to conduct an assessment on
whether volatile organic compounds detected in and near the municipal drinking
water supply are related to the Ardmore facility and, if 21




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necessary, to undertake an appropriate response. That site assessment revealed
contamination, including elevated concentrations of volatile organic compounds,
in the soil in areas of the Ardmore facility and also revealed elevated levels
of certain volatile organic compounds in the shallow residuum ground water zone
at the Ardmore facility. The water currently delivered to residents by the municipality is treated prior
to human consumption, and thus does not contain volatile organic compounds
above acceptable drinking water standards. We do not know whether the
municipality may have delivered untreated water to its water consumers prior to
the installation of the water treatment process; however, due to dilution with
non-contaminated water, which we believe occurs in the operation of the
municipal well system, we believe that it is unlikely that any consumer was
exposed in the past to volatile organic compounds above acceptable drinking
water standards. We have not received or been threatened by any claim from the
municipality or its residents with respect to the drinking water. We have proposed to the Tennessee Division that an interim corrective measure
be implemented at the facility. The interim measure will consist of a system
to extract water and vapors from the areas of highest concentration. The
system can be expanded to conduct additional remediation if required. Based on
recent testing efforts at the facility and the available information, we
preliminarily estimate that it will cost between $0.9 million and $2.1 million
to complete the investigation and develop the remediation plans for this site. Greenville, Mississippi Following our acquisition of the Greenville, Mississippi facility, a
preliminary investigation disclosed certain volatile organic compounds in soil
and ground water at the site. We entered into a consent agreement with the
Mississippi Department of Environmental Quality on July 15, 1997. On November 21, 2002, the Mississippi Department of Environmental Quality
approved a Brownfield agreement with the Company. Thereafter, on December 11,
2002, we donated the property to Washington County, Mississippi to be used for
economic development. We maintain the environmental liability as defined in
the Brownfield agreement. We anticipate long-term monitoring of the site to
continue, at nominal annual cost, until the concentration of contaminants
reaches the Mississippi Department of Environmental Quality target goals. Altoona, Pennsylvania We have entered our Altoona, Pennsylvania facility into the State of
Pennsylvania Department of Environmental Protection Act II Program. The
program addresses contamination issues related to closed hazardous waste
lagoons and oil contamination of soil at this facility. The previous owner
closed the hazardous waste lagoons in 1982. Remaining costs to complete the
investigation phase of the program are estimated to be $30,000. The Report was
submitted to the Pennsylvania Department of Environmental Protection on April
20, 2004. No active remediation is anticipated at this site. Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 Certain of the statements contained in this report are made pursuant to the
Safe Harbor provisions of the Private Securities Litigation Reform Act of
1995. Forward-looking statements 22




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include statements regarding our goals,
beliefs, plans or current expectations, taking into account the information
currently available to our management. Forward-looking statements include all
statements that do not relate solely to current or historical fact. For
example, when we use such words as anticipate, intend, expect, believe,
plan, may, should, would or other words that convey uncertainty of
future events or outcome, we are making forward-looking statements. All
statements which address operating performance, events or developments that we
expect or anticipate will occur in the future, including statements relating to
future sales, earnings, operating performance, restructuring strategies,
property, plant and equipment expenditures and sources and uses of cash, are
forward-looking statements. These forward-looking statements are subject to
various risks and uncertainties that could cause actual results to differ
materially from those stated or implied by such forward-looking statements. We
undertake no obligation to publicly release any revision of any forward-looking
statements contained herein to reflect events or circumstances occurring after
the date hereof or to reflect the occurrence of unanticipated events. With respect to expectations of future sales, earnings, operating performance,
restructuring strategies, property, plant and equipment expenditures and
sources and uses of cash, factors that could affect actual results include,
without limitation:  
    
    our significant amount of debt and the restrictive covenants
contained in our debt agreements;  
    
    our ability to service our debt and incur additional debt;  
    
    our ability to dispose of our properties held for sale and realize their carrying values;  
    
    our ability to achieve growth rates and profit projections assumed
in the valuation of our goodwill;  
    
    the impact of interest rates on the valuations of our pension liabilities and goodwill;
    
    cyclicality, seasonality and weather conditions, which affect the sales of our products;
    
    the timing and magnitude of recovery from the recent economic downturn;
    
    costs and cost savings related to the closing of our Booneville, Mississippi facility;
    
    the persistence of recovery in United States commercial construction activity;  
    
    the impact of competitive factors in our industry, including the
effect of pricing, product lines and other actions taken by our
competitors;  
    
    our ability to maintain our relationships with our major customers;
    
    demand for our products;  
    
    our ability to achieve, and the timeliness with which we achieve,
anticipated results from our capital improvement plans, cost reduction
initiatives, product and process development activities, productivity
and efficiency initiatives, global expansion activities, market share
penetration efforts and working capital management programs; 23




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##### Table of Contents




    
    our potential exposure to environmental liabilities;
    
    economic, political and currency risks relating to our international operations;  
    
    our ability and the ability of our customers to maintain
satisfactory relations with employees;  
    
    costs for labor and benefits including healthcare and pension
costs;  
    
    extraordinary fluctuations in price and availability in the markets
for raw materials and our ability to hedge the cost of raw materials
effectively;  
    
    extraordinary fluctuations in the cost and availability of fuel and
energy resources and our ability to hedge these costs;  
    
    risks to our competitive position from changing technology or the
loss of our intellectual property;  
    
    business and economic risks relating to government regulations that
impact our industry;  
    
    the mix of our geographic and product revenues; and various other factors, many of which are beyond our ability to control or
predict. 24




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##### Table of Contents



ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed to various market risks, including changes in interest rates,
commodity prices and foreign currency rates. Market risk is the potential loss
arising from adverse changes in market rates and prices. We do not enter into
derivatives or other financial instruments for trading or speculative purposes.
In the ordinary course of business, we do enter into various types of
transactions involving financial instruments to manage and reduce the impact of
changes in commodity prices and foreign exchange rates. Interest Rate Risk The fair market value of long-term fixed interest rate debt is subject to
interest rate risk. Generally, the fair market value of fixed interest rate
debt will increase as interest rates fall and decrease as interest rates rise.
The estimated fair value of our total long-term fixed interest rate debt as of
April 4, 2004 was $275.9 million, versus a carrying value of $253.6 million.
The estimated fair market value of our debt is based upon the indicative bid
price for our Senior Notes which approximates their trade value. The yield
implicit in the value of the 7.375% Senior Notes is 8.07% and 8.11% for the
10.5% Senior Notes. A 1% increase from prevailing interest rates would result
in a decrease in fair value of this debt by approximately $9.3 million as of
April 4, 2004. We have in place an interest rate swap on $50 million notional amount of our
7.375% Senior Notes. The terms of the interest rate swap are semi-annual
payment dates of February 1 and August 1, a floating rate option of the
six-month LIBOR rate plus a spread of 3.76% and a termination date of August 1,
2008. As of April 4, 2004, we recorded the fair market value of the interest
rate swap of $0.3 million as other liabilities with a corresponding decrease to
the hedged debt, with equal and offsetting unrealized gains and losses included
in other income expense. For the three month period ended April 4, 2004, the
interest rate swap effectively converted $50 million of fixed rate 7.375%
Senior Notes to a variable rate of 6.54%. Commodity Price Risk In connection with the sale of some raw materials, principally copper, we have
entered into commodity forward contracts to sell metal to reduce the risk of
price increases with respect to both firm-price sales commitments and
anticipated sales. As of April 4, 2004, we had entered into contracts hedging
the raw material requirements for committed and anticipated future sales
through December 2004 having a notional value of $15.4 million. The estimated
fair value of these outstanding contracts based upon forward rates as of April
4, 2004 was an asset of approximately $7.0 million as of April 4, 2004. A
10.0% decline in commodity prices would decrease the estimated fair value of
these outstanding contracts by $2.2 million as of April 4, 2004. We also have entered into commodity forward contracts as we have deemed
appropriate to reduce the risk of price decreases with respect to firm-price
purchase commitments. As of April 4, 2004, we had entered into contracts
hedging the raw material requirements for committed 25




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future purchases through
June 2004 having a notional value of $4.3 million. The estimated fair value of
these outstanding contracts based upon forward rates as of April 4, 2004 was a
loss of approximately $0.2 million as of April 4, 2004. A 10.0% increase in
commodity prices would decrease the estimated fair value of these outstanding
contracts by $0.4 million as of April 4, 2004. We have entered into commodity forward contracts to sell copper with a notional
value of $53.5 million in May 2004. We entered into these forward contracts in
order to mitigate the impact of fluctuating copper prices with regard to the
valuation of our inventory balances. These forward contracts were not
designated as effective hedges and therefore they are marked to market each
month with gains and losses recorded in cost of goods sold. The estimated fair
value of these outstanding contracts based upon forward rates as of April 4,
2004 was a loss of approximately $0.3 million as of April 4, 2004. A 10.0%
increase in commodity prices would increase the estimated loss on these
outstanding contracts by $5.7 million as of April 4, 2004. In connection with the purchase of natural gas, we have entered into commodity
futures contracts for natural gas to reduce our risk of future price increases.
As of April 4, 2004, we had commodity futures contracts to purchase natural
gas for the period May 2004 through December 2004 with a notional amount of
$4.0 million and an unrealized gain of $1.0 million, based on futures prices as
of April 4, 2004. The effect of a 10.0% decline in commodity prices as of
April 4, 2004 for these futures contracts would result in a potential loss in
fair value of approximately $0.5 million. Foreign Currency Risk Some of our operations use foreign exchange forwards to hedge fixed purchase
and sales commitments denominated in a foreign currency. These foreign
currency exposures relate primarily to nonfunctional currency assets and
liabilities denominated in Euros and British Pound Sterling. We do not enter
into forward exchange contracts for trading purposes. These forward contracts
and the underlying hedged receivables and payables are carried at their fair
values with any associated gains and losses recognized in current period
earnings. As of April 4, 2004, we had forward exchange contracts outstanding
to purchase foreign currency with a notional amount of $6.2 million and to sell
foreign currency with a notional amount of $0.6 million. As of April 4, 2004,
we had an insignificant unrealized gain associated with these forward
contracts. The potential loss in fair value for these forward contracts from a
10.0% adverse change in quoted foreign currency exchange rates would be
approximately $0.7 million. We use foreign exchange forward contracts to hedge our inventory currency risk
in Canada. These contracts are denominated in U.S. and Canadian dollars. As of
April 4, 2004, we had forward contracts outstanding to purchase foreign
currency with a notional amount of $7.6 million. As of April 4, 2004, we had an
insignificant unrealized loss associated with these forward contracts. The
potential loss in fair value from a 10% adverse change in exchange rates would
be approximately $0.8 million. 26




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##### Table of Contents



ITEM 4. CONTROLS AND PROCEDURES Under the supervision and with the participation of management, including our
Chief Executive Officer, Dennis J. Horowitz, and our Chief Financial Officer,
James E. Deason, we carried out an evaluation of the effectiveness of our
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as amended (the Exchange Act)) as
of the end of the period covered by this report. Based upon that evaluation,
Messrs. Horowitz and Deason have concluded that, as of the end of the period
covered by this report, our disclosure controls and procedures have been
designed and are effective to provide reasonable assurance that information we
are required to disclose in the reports we file or submit under the Exchange
Act is recorded, processed, summarized and reported within the time periods
specified in the rules and forms of the Securities and Exchange Commission.
These disclosure controls and procedures include, without limitation, controls
and procedures designed to provide reasonable assurance that information we are
required to disclose in such reports is accumulated and communicated to our
management, including Messrs. Horowitz and Deason, as appropriate to allow
timely decisions regarding required disclosure. The design of any system of
controls is based in part upon certain assumptions about the likelihood of
future events. There can be no assurance that any design will succeed in
achieving its stated goal under all potential future conditions, regardless of
how remote. Based upon the evaluation of our management, which was conducted with the
participation of Messrs. Horowitz and Deason, there has been no change in our
internal control over financial reporting during the period covered by this
report that has materially affected, or is reasonably likely to materially
affect, our internal control over financial reporting. 27




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PART II. OTHER INFORMATION 
 ITEM 1. LEGAL PROCEEDINGS There were no material legal proceeding developments during the three-month
period ended April 4, 2004. 
 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 10.1
    
    Amendment No. 4 to Credit Agreement dated as of March 31, 2004 by and
among the Company, its U.S. and Canadian subsidiaries and the lenders
named therein.10.2
    
    Consignment, Forward Contracts and Trading Line Agreement dated March 28, 2001, among the
Company certain of the Companys subsidiaries and Fleet Precious Metals Inc.10.3
    
    Amendment No. 1 to Consignment, Forward Contracts and Trading Line Agreement	dated as
of August 8, 2001 by and among the Company, it subsidiaries and Fleet Precious Metals Inc.10.4
    
    Amendment No. 2 to Consignment, Forward Contracts and Trading Line Agreement dated as of
April 16, 2002 by and among the Company, it subsidiaries and Fleet Precious Metals Inc.10.5
    
    Amendment No. 3 to Consignment, Forward Contracts and Trading Line Agreement dated as of
October 1, 2002 by and among the Company, it subsidiaries and Fleet Precious Metals Inc.10.6
    
    Amendment No. 4 to Consignment, Forward Contracts and Trading Line Agreement dated as of
March 27, 2003 by and among the Company, it subsidiaries and Fleet Precious Metals Inc.10.7
    
    Amendment No. 5 to Consignment, Forward Contracts and Trading Line Agreement dated as of
September 28, 2003 by and among the Company, it subsidiaries and Fleet Precious Metals Inc.10.8
    
    Amendment No. 6 to Consignment, Forward Contracts and Trading Line Agreement dated as of
December 31, 2003 by and among the Company, it subsidiaries and Fleet Precious Metals Inc.10.9
    
    Amendment No. 7 to Consignment, Forward Contracts and Trading Line Agreement dated as of
March 31, 2004 by and among the Company, it subsidiaries and Fleet Precious Metals Inc.31.1
    
    Certification of the Chief Executive Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of the Chief Financial Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002.32.1
    
    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.
 (b) Reports on Form 8-K  A current report on Form 8-K related to the reporting of the Companys
results of operations and financial condition for the quarter ended
December 31, 2003 was furnished to the SEC on March 12, 2004.A current report on Form 8-K related to the Company having extended its
$37.5 million Secured Revolving Credit Facility for two years maturing on
March 31, 2007 including favorable amendments to certain financial
covenants was furnished to the SEC on April 6, 2004.A current report on Form 8-K related to the reporting of the Companys
results of operations and financial condition for the quarter ended April
4, 2004, was furnished to the SEC on April 27, 2004. 28




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SIGNATURE 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 thereto duly authorized. WOLVERINE TUBE, INC.By:
    /s/ James E. DeasonName:
    James E. DeasonDated: May 12, 2004
    
    Title:
    Executive Vice President, Chief Financial Officer,
Secretary and Director 29