<PAGE>   1
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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   ----------

                                    FORM 10-K

(Mark one)

[X]      Annual Report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 for the fiscal year ended December 31, 2000.

or

[ ]      Transition Report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 (No Fee Required) for the transition period from
         ____________ to ____________.

                         Commission File Number 0-24956

                                   ----------

                        ASSOCIATED MATERIALS INCORPORATED
             (Exact name of Registrant as specified in its charter)

                                   ----------

         DELAWARE                                         75-1872487
 (State or other jurisdiction of                         (IRS Employer
 incorporation or organization)                     Identification Number)

                        2200 ROSS AVENUE, SUITE 4100 EAST
                               DALLAS, TEXAS 75201
                         (Address of executive offices)
                                 (214) 220-4600
              (Registrant's telephone number, including area code)

           Securities registered pursuant to Section 12(b) of the Act:
                                      NONE

           Securities registered pursuant to Section 12(g) of the Act:

                                 TITLE OF CLASS
                    -----------------------------------------
                    COMMON STOCK, PAR VALUE, $.0025 PER SHARE

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X]  No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information statement
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

The aggregate market value of the Common Stock and Class B Common Stock held by
non-affiliates of the Registrant as of March 20, 2001 was approximately
$59,606,000.

As of March 20, 2001 the Registrant had 6,098,448 shares of Common Stock and
1,550,000 shares of Class B Common Stock outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant's Proxy Statement for the Annual Meeting of
Stockholders to be held on May 24, 2001, to be filed with the Securities and
Exchange Commission pursuant to Regulation 14A, are incorporated herein by
reference in Part III.

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<PAGE>   2


                                     PART I


ITEM 1.  BUSINESS

         Associated Materials Incorporated (the "Company") is a leading,
vertically integrated manufacturer and nationwide distributor of exterior
residential building products through its Alside division ("Alside"). Alside's
core products are vinyl siding and vinyl windows. These products are marketed on
a wholesale basis to more than 35,000 professional contractors engaged in home
remodeling and new home construction principally through Alside's nationwide
network of more than 75 Alside Supply Centers. Alside's vinyl product offerings
also include vinyl fencing, vinyl decking and vinyl garage doors. In 2000,
Alside accounted for approximately 87% of the Company's net sales. The Company's
operations also include its AmerCable division ("AmerCable"), a manufacturer of
specialty electrical cables for use in underground and surface mining, marine
and offshore drilling, automotive assembly robotics, telecommunications and a
variety of other industrial applications. The Company was incorporated in
Delaware in 1983.

ACQUISITIONS AND DIVESTITURES

         In October 2000, the Company acquired substantially all of the assets
of Alpine Industries, Inc. ("Alpine") for $7.6 million in cash and the
assumption of certain payroll related and property tax liabilities. Included in
the acquired assets is Alpine's leased window fabrication facility located in
Bothell, Washington. This facility manufactures vinyl windows primarily for the
new construction market. In addition to new construction windows, Alpine
manufactures premium sound control windows. This acquisition significantly
increases the Company's presence on the West Coast. The acquisition was
accounted for using the purchase method of accounting.

         The Company completed the sale of its UltraCraft operation, a
manufacturer of semi-custom frameless cabinets, in June 2000. Pre-tax net
proceeds from the sale were $18.9 million after working capital adjustments and
transaction costs. The Company recorded a pre-tax gain of $8.0 million on the
sale. UltraCraft represented approximately 5% of the Company's 1999 net sales.

INDUSTRY OVERVIEW

         Vinyl siding competes with other materials, such as wood, masonry and
metals, for a share of the residential siding market. Vinyl siding has greater
durability and requires less maintenance than wood siding, and generally is less
expensive than wood, masonry or metal siding. According to an industry study
jointly prepared by Sabre Associates, Inc. and Pure Strategy (the "Sabre
Study"), based on unit sales, vinyl siding accounted for approximately 50% of
the exterior siding market in 1998 versus approximately 17% in 1985. Since the
early 1980's, vinyl siding has become the preferred siding product for
professional home remodeling contractors and their customers, and commanded
approximately 62% of the home remodeling marketplace for siding according to the
most recent Sabre Study. More recently, vinyl siding has achieved increased
acceptance in the new construction market, as builders and home buyers have
recognized vinyl's low maintenance, durability and price advantages. The Company
believes that vinyl siding will continue to gain market share in the new
residential construction market while remaining the preferred product of the
remodeling marketplace.

         Vinyl windows require less maintenance, are more durable than either
wood or aluminum windows and provide greater energy efficiency than aluminum
windows. According to the Sabre Study, based on unit sales, approximately 51% of
all residential windows sold in 1998 were vinyl windows versus approximately 27%
in 1991. Since the early 1990's, vinyl windows have become the preferred window
product for professional home remodeling contractors and their customers, and
commanded approximately 75% of the home remodeling marketplace for windows. More
recently, vinyl windows have achieved increased acceptance in the new
construction market as a result of builders and home buyers recognizing vinyl's
favorable attributes, the enactment of local legal or building code requirements
that mandate more energy efficient windows and the increased development and
promotion of vinyl window products by national window manufacturers. The Company
believes that vinyl windows will continue to gain market share in the new
residential construction market while remaining the preferred product of the
remodeling marketplace.

ALSIDE

         PRODUCTS. Alside's principal product offerings are vinyl siding and
vinyl windows, which together accounted for approximately 71% of Alside's 2000
net sales. Alside also manufactures a variety of other products including vinyl
fencing, vinyl decking and vinyl garage doors.


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<PAGE>   3


         The vinyl siding market consists of three segments: economy/new
construction, standard and premium. Vinyl siding quality is determined by its
rigidity, resistance to fading, thickness and ease of installation as well as
other factors. Historically, Alside targeted its products primarily to the
standard segment. More recently, the Company has broadened its product lines to
increase its penetration of the premium and economy segments. The Company
believes that its innovation in product development was key to its siding sales
growth in the past and will continue to be a principal factor in its sales
growth in future years. For example, in late 1995, Alside introduced its
patented Charter Oak siding, which enabled Alside to penetrate the premium
segment of the vinyl siding market. The Company believes that Charter Oak
continues to set the standard for premium vinyl siding products today. Alside
introduced its Conquest siding product in 1997, which has enabled Alside to
achieve additional market penetration in the economy/new construction segment of
the siding industry. During 1998, Alside introduced CenterLock, a patented
product positioned in the premium market segment. In 1999, Alside introduced
Odyssey Plus, an improved and updated version of its popular Odyssey siding
product. During 2000, Alside introduced its Seneca and Landscape products in
order to broaden its offerings for the economy segment. In addition to these
products, Alside has increased the number of colors and profiles offered within
its existing siding products and continues to increase and improve upon the
breadth of its vinyl siding product lines. Alside offers limited warranties
ranging from 50-year warranties to lifetime warranties with its siding products.

         Alside divides its window products into the economy, standard and
premium categories. Product quality within the vinyl window industry is
determined by a number of competitive features including method of construction
and materials used. Alside custom manufactures substantially all of its windows
to fit existing window openings. Custom fabrication provides Alside's customers
with a product that is less expensive to install and more attractive after
installation. Alside's custom windows are used primarily in the repair and
remodeling market. One of the fastest growing segments of the window market is
the new construction segment. The acquisition of Alpine, which manufactures
primarily new construction windows, increased Alside's presence in the new
construction market. Substantially all of Alside's window products are
accompanied by a limited lifetime warranty.

         A summary of Alside's siding and window product offerings is presented
in the table below according to the Company's product line classification:

<TABLE>
<CAPTION>
PRODUCT LINE                 SIDING PRODUCTS           WINDOW PRODUCTS
------------                 ---------------           ---------------
<S>                          <C>                       <C>
Premium                      Charter Oak               UltraMaxx
                             Williamsport              Alpine 9000 Series
                             CenterLock

Standard                                               Geneva
                             Odyssey Plus              Excalibur
                                                       Alpine 8000 Series

Economy                      Conquest                  Performance Series -
                             Seneca                      New Construction
                             Landscape                 Centurion
                                                       Alpine 7000 Series
</TABLE>


         Alside produces vinyl fencing under the brand name UltraGuard,
currently a leading brand of both agricultural and residential vinyl fencing.
Sales of vinyl fence and decking have grown at a compound annual growth rate of
over 28% for the last five years. Sales of UltraGuard fencing accounted for less
than 5% of Alside's net sales in 2000. Alside introduced a raised panel vinyl
garage door in 1997 under the brand name Premium Garage Doors. Alside primarily
markets its fencing and garage doors through independent dealers and not through
its Supply Centers.

         To complete its line of vinyl siding and window products, Alside also
distributes building products manufactured by other companies. These products
include metal siding, wood windows, roofing materials, insulation, cabinets and
installation equipment and tools.

         MARKETING AND DISTRIBUTION. Traditionally, most vinyl siding has been
sold to the home remodeling marketplace through independent distributors. The
Company believes that Alside is one of only two major vinyl siding manufacturers
that market their products primarily through company-owned distribution centers.
Alside has a nationwide distribution network of more than 75 Alside Supply
Centers which market Alside manufactured products and other complementary
building products to more than 35,000 professional home improvement and new
construction contractors. The Company believes that Alside Supply Centers
provide "one-stop shopping" to meet the specialized needs of its
contractor-customers by distributing more than 2,000 building and remodeling
products, including a broad range of Company-manufactured vinyl siding and vinyl
windows as well as products manufactured by others. In 2000, approximately 80%
of Alside's sales were made through its Supply Centers. In addition to sales and
promotional support, contractors look to their local Alside Supply


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Center to provide a broad range of specialty product offerings in order to
maximize their ability to attract remodeling and homebuilding customers.

         Alside believes that distributing products through its Supply Centers
provides the Company with certain competitive advantages such as (a)
long-standing customer relationships, (b) the ability to implement targeted
marketing programs and (c) a permanent presence in local markets. Many of
Alside's contractor-customers have established long-standing relationships
with their local Supply Center based upon individualized service and credit
terms, quality products, timely delivery, breadth of product offerings, strong
sales and promotional programs and competitive prices. Alside supports its
contractor-customer base with marketing and promotional programs that include
product sample cases, sales literature, product videos and other sales and
promotional materials. Professional contractors use these materials to sell
remodeling construction services to prospective customers. The customer
generally relies on the professional contractor to specify the brand of siding
or window to be purchased, subject to the customer's price, color and quality
requirements. Alside's daily contact with its contractor-customers also enables
it to closely monitor activity in each of the remodeling and new construction
markets in which Alside competes. This direct presence in the marketplace
permits Alside to obtain current local market information, providing Alside with
the ability to recognize trends in the marketplace earlier and adapt its product
offerings on a location-by-location basis.

         Many of Alside's contractor-customers install both vinyl siding and
vinyl windows. Because Alside manufactures and distributes both vinyl windows
and vinyl siding, its contractor-customers can acquire both products from a
single source, which the Company believes provides Alside with a competitive
advantage in marketing these products to its target customer base. Furthermore,
Alside has the ability to achieve economies of scale in sales and marketing by
developing integrated programs on either a national or local basis for its vinyl
siding and vinyl window products.

         Each of Alside's Supply Centers is evaluated as a separate profit
center, and compensation of Supply Center personnel is based in part on the
Supply Center's operating results. Decisions to open new Supply Centers, and to
close or relocate existing Supply Centers, are based on Alside's continuing
assessment of market conditions and individual location profitability. During
2000, Alside added eight Supply Centers to its distribution network and closed
one location. The Company presently expects to open up to three new Supply
Centers in 2001. Alside has developed formal training and recruiting programs
for Supply Center personnel which it expects to improve its ability to staff new
locations.

         Through certain of its Supply Centers, Alside's Builder Service
Division provides full-service product installation of its vinyl siding
products, principally to new homebuilders who value the importance of
installation services. Alside also provides installation services for vinyl
replacement windows through certain of its Supply Centers.

         Alside sells its manufactured products to large direct dealers and
distributors, generally in those areas where no Alside Supply Center currently
exists. These sales accounted for approximately 20% of Alside's 2000 net sales.
Despite their aggregate lower percentage of total sales, Alside's largest
individual customers are its large direct dealers and independent distributors.
Alside carefully monitors and evaluates its activity with these customers to
ensure the profitability of this higher volume, lower margin business. No single
customer accounted for 5% or more of Alside's 2000 sales. Alside continues to
expand its network of independent distributors in strategic areas to improve its
penetration into certain markets.

         Alside Window Company Northwest ("Alside Northwest") which consists of
the assets purchased from Alpine Industries, Inc., has historically sold its
window products through a variety of channels including direct to builders and
to independent distributors and lumberyards. Alside Northwest also sells its
products into foreign markets, principally the Far East. Alside Northwest will
continue many of these distribution relationships and also distribute its
products through certain Alside Supply Centers.

         MANUFACTURING. Alside manufactures its vinyl siding products at its
Ennis and Freeport, Texas facilities. The Company added the Freeport facility,
which was completed in 1999, in order to meet its sales expectations for
Alside's siding products. The Freeport facility increased Alside's vinyl siding
production capacity by approximately 25% over 1998 levels. During 2000, Alside
transferred production equipment from its Ennis, Texas plant to the Freeport
plant and purchased additional extrusion equipment to further increase
Freeport's capacity. The Company believes that it currently has adequate vinyl
siding capacity to support significant growth for the next several years. In
addition, incremental capacity can be added to its Freeport facility with only
modest capital requirements. The Ennis, Texas plant also produces vinyl fence.
Alside also operates a vinyl extrusion facility in West Salem, Ohio to produce
vinyl window extrusions as well as vinyl fence and garage door panels. Alside
operates three window fabrication plants which each use vinyl extrusions
manufactured by Alside for the majority of their production requirements,
produce their own glass inserts and utilize high speed welding and cleaning
equipment for their welded window products. By producing its own vinyl
extrusions and glass inserts, Alside believes it achieves significant cost
savings and higher product quality compared to purchasing these materials from
third-party suppliers. During the fourth quarter 2000, the Company purchased
significantly all of the assets of Alpine Industries, Inc. a

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<PAGE>   5

window fabrication facility located in Bothell, Washington. The Bothell facility
produces its glass inserts but has a long-term contract to purchase its vinyl
extrusions from a third-party supplier.

         Alside's vinyl extrusion plants generally operate on a three-shift
basis to optimize equipment productivity and utilize additional equipment to
increase capacity to meet higher seasonal needs. Alside's window plants
generally operate on a single shift basis utilizing both a second shift and
increased numbers of leased production personnel to meet higher seasonal needs.

         RAW MATERIALS. The principal raw materials used by Alside are vinyl
resins, resin stabilizers and pigments, packaging materials, window hardware and
glass, all of which are available from a number of suppliers. Alside has a
contract with its resin supplier to supply substantially all of its contract
vinyl resin requirements and believes that its requirements could also be met by
other suppliers. The price of vinyl resin has been, and may continue to be,
volatile. Alside generally had been able to pass through price increases in raw
materials to its customers. The price of vinyl resin increased significantly
during 1999 and remained at this higher level during 2000. Alside implemented
price increases in late 1999 and 2000 to offset the increases in vinyl resin
prices. Alside does not expect any significant change in the price of vinyl
resin for 2001.

         COMPETITION. Except for Owens Corning, the Company believes that no
company within the residential siding industry competes with Alside on both the
manufacturing and distribution levels. There are, however, numerous small and
large manufacturers of vinyl siding products, some of whom are larger in size
and have greater financial resources than the Company. Alside competes with
Owens Corning and numerous large and small distributors of building products in
its capacity as a distributor of these products. The market for vinyl
replacement windows is highly fragmented, and Alside believes that no single
manufacturer accounts for a significant percentage of national sales. Alside
believes that the market trend towards sales of welded vinyl windows, which
Alside began manufacturing in 1992 and which require expensive, more
sophisticated production equipment, will result in further consolidation of the
window fabrication industry. Alside and its competitors generally compete on
price, product performance, and sales and service support to professional
contractors. Competition varies by region. Alside also faces competition from
alternative materials: wood and aluminum in the window market, and wood, masonry
and metal in the siding market. However, the Company believes Alside's products
are competitive, and in most sectors are gaining share at the expense of these
alternative materials due to vinyl's superior qualities, including its lower
material cost, durability and low maintenance requirements.

AMERCABLE

         AmerCable accounted for approximately 13% of the Company's net sales in
2000. AmerCable manufactures and markets jacketed electrical cable products for
specialized applications. These applications include underground and surface
mining, marine and offshore drilling, automotive assembly robotics,
telecommunications, and a variety of other specialized industrial applications.
AmerCable principally manufactures specialty cable to meet industry technical
standards and end-users' specifications, and its products are internationally
recognized and certified by the world's governing approval authorities.

         PRODUCTS. AmerCable manufactures and distributes three categories of
products: mining cable, marine and offshore drilling cable, and industrial
cable, which accounted for 41%, 26% and 33% of its 2000 sales, respectively.
AmerCable manufactures a complete line of mining cable products, which are
designed and utilized to supply power for mining equipment and systems in
diverse underground and surface mining applications where cable flexibility and
durability are critical. AmerCable's "Tiger(R) Brand" cable products are
considered a leader in the mining cable market. AmerCable's marine cables,
marketed under the trade name "Gexol(TM)", are designed to withstand the
demanding environments of marine, shipboard and offshore drilling applications,
and are recognized as a quality product in the marine cable market. AmerCable's
industrial business unit manufactures and markets a variety of industrial cable
products, which include telecommunications power cables, diesel locomotive
cables ("DLO"), automotive assembly robotics cables, magnet crane cables and a
number of other portable power cable products. The market for telecommunications
central office power cables, which are used to power towers, gateways, amplifier
stations and local office switches, has been one of the fastest growing sectors
in the wire and cable industry. The growth in this market is largely responsible
for the growth of AmerCable's industrial business in 2000 as the market utilizes
DLO products as well as specialty telecommunications power cable products. The
Company anticipates that this market will continue to develop and expand over
the next three years.

         MARKETING AND DISTRIBUTION. AmerCable markets its cable principally to
independent distributors who resell to the end user, except for certain marine
products that are distributed through its Offshore/Marine Cable Specialists
division.

         RAW MATERIALS. The principal raw material used by AmerCable is copper
strand, which is available from a number of suppliers. Historically, copper
strand has been subject to rapid price changes. AmerCable generally prices its
cable

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<PAGE>   6

products based upon market prices for copper at time of shipment. As a result,
sudden decreases in copper prices can result in inventory being in excess of its
net realizable value. In certain instances, AmerCable may guarantee a fixed
copper price for its products where there is a significant time lag between the
purchase order and shipment. In these cases, AmerCable generally attempts to
hedge its position on copper prices.

         COMPETITION. Rather than compete in the higher volume, commodity-type
markets such as residential building wire and magnet wire, AmerCable seeks to
compete as a market leader in small, niche markets in which products typically
are specialized constructions to meet market-specific applications and require a
higher level of value-added content. AmerCable competes with numerous large and
small manufacturers, a number of which have substantially greater resources than
the Company. AmerCable generally competes on sales and product service, product
performance, delivery speed and price. AmerCable believes that it has developed
strong customer relations as a result of its ability to fulfill customer needs
through the manufacture of high quality products, through consistent
availability of products with industry-leading lead times and on-time delivery,
through innovative product enhancements and new products and through superior
customer service including strong field application engineering capabilities.

AMERCORD

         In addition to its Alside and AmerCable divisions, the Company owns a
9.9% interest in Amercord Inc. ("Amercord"). Amercord manufactures and markets
steel cord and bead wire to the tire manufacturing industry. The Company reduced
its ownership in Amercord from 50% to 9.9% in the fourth quarter of 1999. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."

EMPLOYEES

         Alside's employment needs vary seasonally with sales and production
levels. As of December 31, 2000, Alside had approximately 2,000 full-time
employees, including approximately 900 hourly workers. The West Salem, Ohio
plant is Alside's only unionized manufacturing facility, employing approximately
90 covered workers as of December 31, 2000. Additionally, approximately 60
hourly workers in certain Supply Center locations are covered by collective
bargaining agreements. The Company considers Alside's labor relations to be
good.

         Alside operates vinyl window manufacturing plants in Cedar Rapids,
Iowa; Kinston, North Carolina; and Akron, Ohio with leased production employees.
The Company believes that the employee leasing program provides it with
scheduling flexibility for seasonal production loads and with competitive
advantages in obtaining principally unskilled labor personnel. The aggregate
number of leased employees in the window plants ranges from approximately 300 to
500 people, based on seasonal production requirements.

         As of December 31, 2000, AmerCable employed approximately 210 people,
including 110 hourly workers, none of whom are covered by collective bargaining
agreements. AmerCable maintains good relations with its employees.

TRADEMARKS AND PATENTS

         Alside has registered and nonregistered trade names and trademarks
covering the principal brand names and product lines under which its products
are marketed. Although Alside considers each of these items to be valuable, the
Company does not currently believe this property, other than the "Alside(R)"
trademark, to be material. Alside has obtained patents on certain claims
associated with its siding products, which the Company believes distinguish
Alside's products from those of its competitors.

GOVERNMENT REGULATION AND ENVIRONMENTAL MATTERS

         The Company is subject to numerous federal and state statutes and
regulations relating to, among other things, air and water quality, the
discharge of materials into the environment and safety and health issues. The
Company does not expect compliance with these requirements to have a material
impact on the Company's earnings or competitive position in the foreseeable
future. Additionally, no significant capital expenditures are presently
anticipated related to compliance with these requirements.

         The Company entered into a consent order dated August 25, 1992 with the
United States Environmental Protection Agency pertaining to corrective action
requirements associated with the use of hazardous waste storage facilities at
its Akron, Ohio location. With the exception of a small container storage area,
the use of these facilities was terminated prior to the acquisition of the
Alside assets by the Company from USX Corporation ("USX") in 1984. The effects
of the past practices at this facility are continuing to be investigated
pursuant to the terms of the consent order. The Company believes


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that USX bears financial responsibility for substantially all of the direct
costs of corrective action at these facilities under the relevant contract terms
and under statutory and common law. To date, USX has reimbursed the Company for
substantially all of the direct costs of corrective action at these facilities,
and the Company expects that USX will continue to reimburse the Company for
substantially all of the direct costs of corrective action at these facilities.
As a result, the Company believes that any material claims resulting from this
proceeding will not have a material adverse effect on the Company.

EXECUTIVE OFFICERS AND KEY EMPLOYEES

         The following information concerning the executive officers and other
key employees of the Company is as of March 20, 2001.

         William W. Winspear, 67, has been Chairman of the Board, President and
Chief Executive Officer of the Company since its inception in 1983. Mr. Winspear
was President and Chief Executive Officer of Chaparral Steel Company from 1975
to 1982. Mr. Winspear is the father of Robert L. Winspear.

         Michael Caporale, Jr., 49, was named Chief Executive Officer of the
Alside division and became a director of the Company in February 2001. Mr.
Caporale joined the Company in January 2000 as President of the Company's Alside
Window Manufacturing operation, became President and Chief Operating Officer of
the Company's Alside division in April 2000 and was named a Vice President of
the Company in August 2000. Prior to joining the Company, Mr. Caporale was the
President of Great Lakes Window, Inc., a subsidiary of Nortek, Inc., where he
had been employed since 1995.

         Robert F. Hogan, 44, has been President and Chief Executive Officer of
AmerCable since 1993 and Vice President of the Company since 1984. Prior to
becoming President of AmerCable, Mr. Hogan was Treasurer and Secretary of the
Company from 1984 to 1993.

         Robert L. Winspear, 35, joined the Company in 1993, was named Vice
President, Treasurer and Secretary in October 1993 and was named Chief Financial
Officer in 1998. Prior to joining the Company, Mr. Winspear was employed by
Andersen. Mr. Winspear is the son of William W. Winspear.

         Kenneth L. Bloom, 38, joined the Company in July 2000 as Alside's Vice
President of Window Manufacturing. Mr. Bloom was named President of the
Company's Alside Window Company in March 2001. Prior to joining
the Company, Mr. Bloom was Corporate Vice President of Field Container Co.,
L.P., where he had been employed since 1996.

         James R. Bussman, 53, has been Executive Vice President - Corporate
Services of Alside since 1983. Mr. Bussman has held various other positions with
Alside since 1972, and was named a Vice President of the Company in 1984.

         Wayne D. Fredrick, 54, was named Group Vice President - Window Products
of Alside in 1997. From 1990 to 1996, Mr. Fredrick was Senior Vice President -
Window Products of Alside. Mr. Fredrick joined Alside in 1973.

         Gary D. Hofmann, 44, was named Group Vice President - Vinyl Siding of
Alside in October 2000. From 1997 to 2000, Mr. Hofmann was Senior Vice President
- Vinyl Siding Sales of Alside. Mr. Hofmann joined Alside in 1995 as Vice
President - Vinyl Siding Sales.

         D. Keith LaVanway, 36, joined the Company in February 2001 as Vice
President - Chief Financial Officer of Alside and was named a Vice President of
the Company. Prior to joining the Company, Mr. LaVanway was employed by Nortek,
Inc. from 1995 to 2001, most recently as Vice President - Chief Financial
Officer of Peachtree Doors and Windows Company.

         Benjamin L. McGarry, 53, was named Group Vice President - Vinyl
Manufacturing of Alside in 1997. From 1984 to 1996, Mr. McGarry was Senior Vice
President - Manufacturing of Alside. Mr. McGarry joined Alside in 1980.

         Officers of the Company serve at the discretion of the Board of
Directors. Messrs. Bloom, Bussman, Fredrick, Hofmann, LaVanway and McGarry are
considered key employees of the Company because of their responsibilities as
divisional officers in the respective capacities indicated. The Company,
however, does not consider these employees to be executive officers of the
Company.


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<PAGE>   8

ITEM 2.  PROPERTIES

         The Company's operations include both owned and leased facilities as
described below:

<TABLE>
<CAPTION>
              LOCATION                              PRINCIPAL USE                       SQUARE FEET
              --------                              -------------                       -----------
<S>                                      <C>                                            <C>
ALSIDE

   Akron, Ohio                            Alside Headquarters                              70,000
                                          Vinyl Windows, Vinyl Fencing and Vinyl
                                             Garage Doors                                 577,000

   Ennis, Texas                           Vinyl Siding Products, Vinyl Fencing            301,000

   Freeport, Texas                        Vinyl Siding Products                           120,000

   West Salem, Ohio                       Vinyl Window Extrusions, Fencing
                                             and Garage Door Panels                       173,000

   Bothell, Washington                    Vinyl Windows                                   159,000(1)

   Kinston, North Carolina                Vinyl Windows                                   319,000(1)

   Cedar Rapids, Iowa                     Vinyl Windows                                   128,000(1)


AMERCABLE

   El Dorado, Arkansas                    AmerCable Headquarters and                      317,000
                                             Electrical Cable

   Houston, Texas                         Cable Distribution                               33,000(1)
</TABLE>

----------
(1)  Leased facilities.

         Management believes that the Company's facilities are generally in good
operating condition and are adequate to meet anticipated requirements in the
near future.

         Alside also operates more than 75 Alside Supply Centers in major
metropolitan areas throughout the United States. Except for one owned location
in Akron, Ohio, the Company leases its Supply Centers for terms generally
ranging from five to seven years with renewal options. The Supply Centers range
in size from 6,000 square feet to 50,000 square feet depending on sales volume
and the breadth and type of products offered at each location.

         The leases for Alside's window plants extend through 2011 for the
Bothell location and 2005 for the Cedar Rapids and Kinston locations. Each lease
is renewable at the Company's option for an additional five-year period. The
Company's corporate headquarters occupy approximately 3,500 square feet of
leased office space in Dallas, Texas. Under the Company's existing credit
agreement with KeyBank, N.A. (the "Credit Agreement"), the bank lender holds a
security interest in the Company's contract rights, including real property
leases.


ITEM 3.  LEGAL PROCEEDINGS

         The Company is involved from time to time in litigation arising in the
ordinary course of its business, none of which, after giving effect to the
Company's existing insurance coverage, is expected to have a material adverse
effect on the Company.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS

         None.


                                       7
<PAGE>   9

                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET INFORMATION

         The Company's Common Stock is traded on The Nasdaq National Market with
the ticker symbol "SIDE." The following table shows the price range of the
Company's Common Stock for each quarter in 2000 and 1999:


<TABLE>
<CAPTION>
                                        Prices
                                --------------------
               Quarter           High         Low
----------------------------------------------------
<S>            <C>               <C>         <C>
2000           First             $15.88      $11.13
2000           Second             17.88       14.75
2000           Third              19.25       14.00
2000           Fourth             16.75       13.06
---------------------------------------------------
               Year              $19.25      $11.13
---------------------------------------------------
1999           First             $11.69      $10.13
1999           Second             15.00       10.50
1999           Third              16.00       13.00
1999           Fourth             16.38       14.00
---------------------------------------------------
               Year              $16.38      $10.13
---------------------------------------------------
</TABLE>

HOLDERS

         At March 20, 2001, the Company had 40 record holders of Common Stock.
The Prudential Insurance Company of America ("Prudential") is the record holder
of all 1,550,000 shares of the Company's outstanding Class B Common Stock, par
value $.0025 per share ("Class B Common Stock"), which shares of Class B Common
Stock are convertible, at the holder's option, into shares of Common Stock on a
basis of one share of Common Stock for each share of Class B Common Stock. In
this report, the Company's Common Stock and Class B Common Stock are referred to
collectively as "common shares."

DIVIDENDS

         The Company paid dividends of $0.10 per common share in 1999 and 2000.
On February 22, 2001, the Board of Directors of the Company announced a cash
dividend of $0.10 per common share payable to stockholders of record on March
16, 2001. The Company presently intends to pay an annual cash dividend. However,
the Company's future dividend policy will depend upon the Company's capital
requirements, results of operations, financial condition and other factors as
the Company's Board of Directors deems relevant. Further, the payment of cash
dividends is restricted by covenants in the Credit Agreement and the Indenture
pursuant to which the Company's 9 1/4% Senior Subordinated Notes ("9 1/4%
Notes") were issued.



                                       8
<PAGE>   10


ITEM 6.  SELECTED FINANCIAL DATA

         The selected financial information set forth below for the five-year
period ended December 31, 2000 was derived from the financial statements of the
Company which have been audited by Ernst & Young LLP, independent auditors. The
data should be read in conjunction with Management's Discussion and Analysis of
Financial Condition and Results of Operations and the financial statements,
related notes and other financial information included elsewhere in this report.


<TABLE>
<CAPTION>
                                                                                YEAR ENDED DECEMBER 31,
                                                          -------------------------------------------------------------
                                                             1996         1997         1998         1999         2000
                                                          ---------    ---------    ---------    ---------    ---------
                                                                       (IN THOUSANDS, EXCEPT PER SHARE DATA)
<S>                                                       <C>          <C>          <C>          <C>          <C>
INCOME STATEMENT DATA:
   Net sales (1) ......................................   $ 358,860    $ 399,974    $ 410,111    $ 455,268    $ 499,393
   Cost of sales (1) ..................................     257,968      285,798      285,822      317,596      353,994
                                                          ---------    ---------    ---------    ---------    ---------
   Gross profit .......................................     100,892      114,176      124,289      137,672      145,399
   Selling, general and administrative expenses .......      77,740       81,142       88,727       96,028      107,255
   Other income, net (2) ..............................        --           --          2,673         --           --
                                                          ---------    ---------    ---------    ---------    ---------
   Income from operations .............................      23,152       33,034       38,235       41,644       38,144
   Interest expense ...................................      10,882        9,795        7,565        6,779        6,046
   Gain on the sale of UltraCraft .....................        --           --           --           --          8,012
   Equity in (earnings) loss  of Amercord (3) .........      (1,724)         626        1,881        1,337         --
   Writedown of Amercord (4) ..........................        --           --          4,351         --           --
                                                          ---------    ---------    ---------    ---------    ---------
   Income before income tax expense ...................      13,994       22,613       24,438       33,528       40,110
   Income tax expense .................................       5,172        9,524       11,382       13,038       16,555
                                                          ---------    ---------    ---------    ---------    ---------
   Income before extraordinary item ...................       8,822       13,089       13,056       20,490       23,555
   Extraordinary item (5) .............................        --           --          4,107         --           --
                                                          ---------    ---------    ---------    ---------    ---------
   Net income .........................................   $   8,822    $  13,089    $   8,949    $  20,490    $  23,555
                                                          =========    =========    =========    =========    =========

SHARE DATA:
   Basic earnings per common share before
      extraordinary item ..............................   $    1.16    $    1.72    $    1.58    $    2.52    $    2.94
   Diluted earnings per common share before
      extraordinary item (6) ..........................        1.14         1.69         1.55         2.46         2.85
   Weighted average number of diluted shares ..........       7,746        7,756        8,403        8,344        8,258
   Dividends per share ................................   $    --      $    0.05    $   0.075    $    0.10    $    0.10

OTHER DATA:
   EBITDA (7) .........................................   $  29,025    $  39,555    $  45,452    $  50,163    $  47,694
   Capital expenditures ...............................       8,110        8,758       14,261       18,915       11,925
   Cash provided by operating activities ..............      15,055       22,496       26,799       15,244       22,968
   Cash used in investing activities ..................      (8,087)      (7,941)     (14,712)     (17,619)      (5,538)
   Cash provided by (used in) financing activities ....      (6,863)     (15,004)         942       (9,157)      (4,983)
   Ratio of EBITDA to interest expense ................       2.67x        4.04x        6.01x        7.40x        7.89x
</TABLE>


<TABLE>
<CAPTION>
                                                                                  DECEMBER 31,
                                                          -------------------------------------------------------------
                                                             1996         1997         1998         1999         2000
                                                          ---------    ---------    ---------    ---------    ---------
                                                                                  (IN THOUSANDS)
<S>                                                       <C>         <C>         <C>         <C>         <C>
BALANCE SHEET DATA:
  Working capital .....................................   $  51,821   $  61,191   $  79,225   $  85,878   $ 102,064
  Total assets ........................................     177,709     178,504     189,319     206,296     231,141
  Short-term debt, including current maturities .......      14,808       2,314       3,600        --          --
  Long-term debt, less current maturities .............      80,350      78,600      75,000      75,000      75,000
  Stockholders' equity ................................      32,246      44,734      64,378      79,326      97,990
</TABLE>

---------
(1)  Certain prior period amounts have been restated to conform with the current
     period presentation.

(2)  The Company recorded a $5.9 million curtailment gain due to the freeze of
     the Alside Retirement Plan at December 31, 1998. The Company also accrued
     an additional $3.3 million expense for retiree medical benefits related to
     the 1989 closure of Alside's metal siding plant.

(3)  In 1996, the Company's equity in the earnings of Amercord was affected by a
     change in accounting principle, a settlement of a royalty dispute and an
     asset impairment writedown, the net amount of which was approximately
     $800,000 in income.

(4)  The Company recorded a pretax writedown on its investment in Amercord in
     anticipation of a loss on the sale of Amercord.


                                       9
<PAGE>   11

(5)  The extraordinary item represents, net of tax, the loss recognized on the
     writeoff of debt issuance costs and the prepayment premium paid on the
     purchase of the Company's 11 1/2% Senior Subordinated Notes ("11 1/2%
     Notes") in 1998.

(6)  In accordance with the Commission Staff Accounting Bulletin, Topic 4D,
     shares of Common Stock issued during the 12-month period prior to the
     Company's initial public offering at prices below the initial public
     offering price have been included in the calculation as if these shares
     were outstanding for all periods presented. Earnings per share for all
     periods prior to the initial public offering in 1998 were computed in
     accordance with Topic 4D.

(7)  EBITDA is calculated as income from operations plus depreciation and
     amortization. The Company has included information concerning EBITDA
     because it believes that EBITDA is used by certain investors as one measure
     of an issuer's historical ability to service its debt. EBITDA should not be
     considered as an alternative to, or more meaningful than, net income as an
     indicator of the Company's operating performance or to cash flows as a
     measure of liquidity. EBITDA as presented above for the Company may not be
     comparable to similarly titled measures reported by other companies.


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

OVERVIEW

         GENERAL. The Company consists of two operating divisions, Alside and
AmerCable. In addition, the Company owns an interest in Amercord, which was
accounted for using the equity method until November 1999 when it was
recapitalized, reducing the Company's interest in Amercord from 50% to 9.9%.
Since the recapitalization, the Company has accounted for Amercord under the
cost method.

         ALSIDE. The Company's results of operations are primarily affected by
the operating results of Alside, which accounted for more than 87% of the
Company's net sales in each of the last three years. Because its residential
building products are consumer durable goods, Alside's sales are impacted by the
availability of consumer credit, consumer interest rates, employment trends,
changes in levels of consumer confidence, national and regional trends in new
housing starts and general economic conditions. Alside's sales are also affected
by changes in consumer preferences with respect to types of building products.
Alside's products are used in the repair and remodeling, as well as the new
construction, sectors of the building industry. For each of the three years in
the period ended December 31, 2000, Alside believes that its sales were made
primarily to the repair and remodeling sector.

         The Company believes that vinyl building products will continue to gain
market share from metal and wood products due to vinyl's favorable attributes,
which include its durability, lower maintenance cost and lower cost compared to
wood and metal. Although no assurances can be given, the Company further
believes that these increases in market share, together with Alside's increased
marketing efforts, will increase Alside's sales of vinyl siding, vinyl windows
and other complementary building products.

         The Company operates with significant operating and financial leverage.
Significant portions of Alside's selling, general and administrative expenses
are fixed costs that neither increase nor decrease proportionately with sales.
As a result, a percentage change in Alside's net sales will have a greater
percentage effect on Alside's income from operations. In addition, interest
expense related to the Company's long-term debt is fixed.

         AMERCABLE. Rather than compete in the higher volume, commodity-type
markets such as residential building wire and magnet wire, AmerCable seeks to
compete as a market leader in smaller, niche markets in which products typically
are specialized constructions designed to meet market-specific applications and
require a higher value-added content. AmerCable manufactures and distributes a
core group of cable products that it believes best utilize its manufacturing
efficiencies and marketing and distribution capabilities. Its cable products are
used primarily in the mining, offshore drilling and telecommunication
industries. AmerCable's results can be affected by a slowdown in the mining and
offshore drilling industries as a result of lower commodity prices. AmerCable
expects sales of its telecommunication cable products will be favorably impacted
as the telecommunication market continues to develop and expand over the next
three years. AmerCable's sales can also be affected by the price of copper as
AmerCable generally prices its cable products based upon market prices for
copper at the time of shipment.

         AMERCORD. In November 1999, Amercord was recapitalized, and in that
transaction the Company's interest in Amercord was reduced from 50% to 9.9%. As
a result of the recapitalization, the Company received $1.2 million in cash (net
of related expenses) and a subordinated note for $1.5 million due November 2004.
The Company has the right to require Amercord to purchase the Company's
remaining 9.9% interest for $2.0 million in November 2003.


                                       10
<PAGE>   12

         SEGMENT DATA. Alside accounted for more than 87% of the Company's net
sales and income from operations in each of the three years in the period ended
December 31, 2000. In 2000, Alside accounted for approximately 86% of the
Company's income from operations exclusive of corporate selling, general and
administrative expenses. Management believes that a discussion of the Company's
results and financial position for these periods is enhanced by presenting
segment information for Alside and AmerCable. The tables below set forth for the
periods indicated certain items from the Company's financial statements:

<TABLE>
<CAPTION>
                                                                      YEARS ENDED DECEMBER 31,
                                           ------------------------------------------------------------------
                                                   2000                  1999                   1998
                                           -------------------  ----------------------   --------------------
                                                        % OF                    % OF                  % OF
                                                      TOTAL NET              TOTAL NET              TOTAL NET
                                            AMOUNT     SALES       AMOUNT      SALES      AMOUNT      SALES
                                           --------   ---------   --------   ---------   --------   ---------
                                                                (IN THOUSANDS)
<S>                                        <C>            <C>     <C>            <C>     <C>            <C>
CONSOLIDATED:
   Net sales - Alside (1) ..............   $434,845       87.1%   $410,107       90.1%   $357,292       87.1%
   Net sales - AmerCable (1) ...........     64,548       12.9      45,161        9.9      52,819       12.9
                                           --------   --------    --------   --------    --------   --------
      Total net sales ..................    499,393      100.0     455,268      100.0     410,111      100.0
   Gross profit ........................    145,399       29.1     137,672       30.2     124,289       30.3
   Selling, general and
      administrative expenses (2) ......    107,255       21.5      96,028       21.1      88,727       21.6
   Other income, net ...................       --         --          --         --         2,673        0.6
                                           --------   --------    --------   --------    --------   --------
   Income from operations ..............     38,144        7.6      41,644        9.1      38,235        9.3
   Interest expense ....................      6,046        1.2       6,779        1.5       7,565        1.8
   Gain on the sale of UltraCraft ......      8,012        1.6        --         --          --         --
   Equity in loss of Amercord ..........       --         --         1,337        0.3       1,881        0.4
   Writedown of Amercord ...............       --         --          --         --         4,351        1.1
                                           --------   --------    --------   --------    --------   --------
   Income before income tax expense ....     40,110        8.0      33,528        7.3      24,438        6.0
   Income tax expense ..................     16,555        3.3      13,038        2.8      11,382        2.8
                                           --------   --------    --------   --------    --------   --------
   Income before extraordinary item ....   $ 23,555        4.7%   $ 20,490        4.5%   $ 13,056        3.2%
                                           ========   ========    ========   ========    ========   ========

ALSIDE:
   Net sales (1) .......................   $434,845      100.0%   $410,107      100.0%   $357,292      100.0%
   Gross profit ........................    131,704       30.3     129,996       31.7     113,797       31.8
   Selling, general and
      administrative expenses ..........     95,404       22.0      87,588       21.4      81,282       22.7
   Other income, net ...................       --         --          --         --         2,673        0.7
                                           --------   --------    --------   --------    --------   --------
   Income from operations ..............   $ 36,300        8.3%   $ 42,408       10.3%   $ 35,188        9.8%
                                           ========   ========    ========   ========    ========   ========

AMERCABLE:
   Net sales (1) .......................   $ 64,548      100.0%   $ 45,161      100.0%   $ 52,819      100.0%
   Gross profit ........................     13,695       21.2       7,676       17.0      10,492       19.8
   Selling, general and
      administrative expenses ..........      7,880       12.2       4,801       10.6       4,718        8.9
                                           --------   --------    --------   --------    --------   --------
   Income from operations ..............   $  5,815        9.0%   $  2,875        6.4%   $  5,774       10.9%
                                           ========   ========    ========   ========    ========   ========
</TABLE>

---------
(1)  Certain prior period amounts have been restated to conform with the current
     period presentation.

(2)  Consolidated selling, general and administrative expenses include corporate
     expenses of $4.0 million, $3.6 million and $2.7 million for the years 2000,
     1999 and 1998, respectively.

RESULTS OF OPERATIONS

         YEAR ENDED DECEMBER 31, 2000 COMPARED TO THE YEAR ENDED DECEMBER 31,
1999

         GENERAL. The Company's net sales increased 9.7% to $499.4 million in
2000 as compared to $455.3 million in 1999 due to higher sales at the Company's
Alside and AmerCable divisions. Income from operations decreased 8.4% to $38.1
million in 2000 as compared to $41.6 million in 1999 as higher operating profits
from the Company's AmerCable division were offset by lower operating profits at
Alside. Net income increased to $23.6 million or $2.85 per share in 2000 as
compared to $20.5 million or $2.46 per share in 1999. The increase in net income
was due to the sale of the Company's

                                       11
<PAGE>   13

cabinet operations, UltraCraft, in June 2000, which resulted in a pre-tax gain
of $8.0 million. 2000 net income and earnings per share exclusive of the gain on
UltraCraft were $18.6 million and $2.26, respectively.

         ALSIDE. Net sales at Alside increased to a record $434.8 million in
2000 as compared to $410.1 million in 1999 due to higher sales prices in vinyl
siding and higher sales volume in vinyl windows and vinyl fence. Vinyl siding
sales increased in 2000 as compared to 1999 as higher sales prices which were
implemented to offset higher vinyl resin costs were partially offset by a slight
decrease in siding unit volume. Vinyl window sales increased 9.7% in 2000 due
primarily to a 6.5% increase in unit sales volume while sales of vinyl fence
increased 28.5% due to higher sales volume. Gross profit increased to $131.7
million in 2000 but decreased as a percentage of sales as Alside was unable to
recover any incremental margin on the selling price increases that resulted due
to higher vinyl resin prices. Selling, general and administrative expense
increased to $95.4 million in 2000 as compared to $87.6 million in 1999 due to
the opening of eight additional Supply Centers as well as higher personnel costs
and higher legal expense. Income from operations decreased to $36.3 million in
2000 from $42.4 million in 1999 as higher gross profits were more than offset by
higher selling, general and administrative expense.

         AMERCABLE. AmerCable's net sales increased 42.9% to $64.5 million in
2000 as compared to $45.2 million in 1999 due to higher volume across all
product lines. Sales increased by 86% in the industrial segment as sales of
power cable to the telecommunications industry were very strong. Gross profit
increased to $13.7 million in 2000 up from $7.7 million in 1999 due to higher
sales and improved fixed cost absorption. Gross profit as a percentage of sales
increased to 21.2% as compared to 17.0% in 1999. Selling, general and
administrative expense increased to $7.9 million in 2000 as compared to $4.8
million in 1999. The increase is due to a $1.4 million increase in bad debt
expense as well as higher personnel costs and higher incentive compensation. Bad
debt expense increased by $1.4 million in 2000 as a result of a large customer
that filed for bankruptcy. Income from operations increased to $5.8 million in
2000 as compared to $2.9 million in 1999 due to higher gross profits, which were
offset in part by higher selling, general and administrative expense.

         OTHER. Net interest expense decreased $733,000 or 10.8% in 2000 as
compared to 1999 primarily due to an increase in the Company's investment
income. The Company recorded interest income of $1.1 million in 2000 as compared
to $329,000 in 1999. The Company recorded $1.1 million in additional income tax
expense due to an adjustment to a 1986 deferred tax asset recorded pursuant to
the spin-off of the tire cord division into Amercord. This adjustment increased
the effective tax rate from 38.5% to 41.3%.

         YEAR ENDED DECEMBER 31, 1999 COMPARED TO THE YEAR ENDED DECEMBER 31,
1998

         GENERAL. The Company's net sales increased 11.0% to $455.3 million in
1999 as compared to $410.1 million in 1998 due to higher sales at the Company's
Alside division. Income from operations increased to $41.6 million as compared
to $38.2 million in 1998 due to increased profitability at Alside, which was
partially offset by AmerCable's results from operations. Income before
extraordinary item was $20.5 million or $2.46 per share on 8.3 million weighted
average shares in 1999 as compared to $13.1 million or $1.55 per share on 8.4
million weighted average shares in 1998. The Company's 1998 income before
extraordinary item was $14.7 million or $1.75 per share exclusive of the
one-time accounting adjustments discussed below.

         ALSIDE. Alside's net sales increased 14.8% to $410.1 million in 1999 as
compared to $357.3 million in 1998 due primarily to higher sales volume.
Alside's sales increased across all product lines in 1999 as compared to 1998.
During 1999, unit sales of vinyl siding and vinyl windows increased 16.2% and
11.0%, respectively, as compared to 1998. Gross profit as a percentage of net
sales decreased slightly to 31.7% in 1999 as compared to 31.8%. Selling, general
and administrative expense increased 7.8% to $87.6 million in 1999 as compared
to $81.3 million in 1998 but decreased as a percentage of net sales. The
increase in selling, general and administrative expense was due primarily to
higher personnel costs, including incentive compensation. Income from operations
increased $7.2 million, or 20.5% to $42.4 million in 1999 as compared to $35.2
million in 1998 due to higher sales and favorable fixed cost absorption. During
1998, Alside recorded a $5.9 million curtailment gain upon freezing the Alside
Retirement Plan on December 31, 1998. Alside also accrued an additional $3.3
million for retiree medical benefits related to the 1989 closing of its metal
siding plant. This additional accrual was based upon a recent actuarial study
taking into account unfavorable claims experience. The net effect of these
adjustments was a $2.7 million increase in 1998 operating income. Exclusive of
the $2.7 million one-time accounting adjustments recorded in 1998, income from
operations increased $9.9 million or 30.4%.

         AMERCABLE. AmerCable's net sales decreased to $45.2 million in 1999 as
compared to $52.8 million in 1998 due primarily to lower sales volume of mining
and offshore drilling products. Lower commodity prices resulted in decreased
demand for mining and offshore drilling cable. Commodity prices improved during
the last half of 1999. Gross profit as a percentage of net sales decreased to
17.0% in 1999 as compared to 19.8% in 1998 due to lower sales volume and lower
fixed cost absorption resulting from lower production volume. Selling, general
and administrative expense increased to

                                       12
<PAGE>   14

$4.8 million in 1999 as compared to $4.7 million in 1998 as lower incentive
compensation was offset by higher personnel costs resulting from the hiring of
additional sales personnel as well as higher advertising expenditures. Income
from operations decreased to $2.9 million in 1999 as compared to $5.8 million in
1998 due primarily to lower sales volume and lower fixed cost absorption.

         AMERCORD. In November 1999, Amercord was recapitalized. In this
transaction, the Company's interest in Amercord was reduced from 50% to 9.9%. As
a result of the recapitalization, the Company received cash of $1.2 million (net
of related expenses) and a subordinated note for $1.5 million due November 2004.
In addition, the Company has the right to require Amercord to purchase the
Company's remaining 9.9% interest for $2.0 million in November 2003. The Company
currently accounts for Amercord using the cost method of accounting. Prior to
Amercord's recapitalization, the Company accounted for Amercord using the equity
method of accounting. The Company recorded a loss of $1.3 million and $1.9
million on its equity in the losses of Amercord during 1999 and 1998,
respectively.

        OTHER. Net interest expense decreased $786,000 or 10.4% in 1999 as
compared to 1998 primarily due to a decrease in the Company's borrowings and the
repayment of the Company's taxable notes in April 1999. The Company recorded
interest income of $329,000 in 1999. The Company's effective tax rate decreased
to 38.9% in 1999 due to lower state taxes. In 1998, the Company's Board of
Directors approved a stock repurchase program of up to 800,000 shares of Common
Stock. During 1999, the Company repurchased 467,000 shares of Common Stock under
this program, which increased earnings per share by $0.07 per share (after
interest and tax effects).

QUARTERLY FINANCIAL DATA

         GENERAL. Because most of Alside's building products are intended for
exterior use, Alside's sales and operating profits tend to be lower during
periods of inclement weather. Weather conditions in the first quarter of each
calendar year historically result in that quarter producing significantly less
sales revenue than in any other period of the year. As a result, the Company has
historically had small profits or losses in the first quarter, and reduced
profits in the fourth quarter of each calendar year due to the significant
impact of Alside on the Company's performance.

Quarterly sales and operating profit data for the Company in 2000 and 1999 are
shown in the table below:

<TABLE>
<CAPTION>
                                                                THREE MONTHS ENDED
                                                -------------------------------------------------
                                                MARCH 31     JUNE 30    SEPTEMBER 30  DECEMBER 31
                                                --------     --------   ------------  -----------
                                                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S>                                             <C>          <C>          <C>          <C>
 2000
  Net sales - Alside (1) ..................     $ 87,141     $119,135     $118,715     $109,854
  Net sales - AmerCable (1) ...............       16,278       15,246       16,096       16,928
                                                --------     --------     --------     --------
    Total net sales .......................      103,419      134,381      134,811      126,782
  Gross profit ............................       28,593       39,733       40,277       36,796
  Income from operations ..................        4,310       12,715       13,155        7,964
  Net Income ..............................        1,591       11,894        5,967        4,103
  Basic earnings per common share .........         0.20         1.48         0.74         0.52
  Diluted earnings per common share .......         0.19         1.43         0.71         0.50

1999
  Net sales - Alside (1) ..................     $ 74,497     $109,613     $117,899     $108,098
  Net sales - AmerCable (1) ...............       10,721        9,969       11,163       13,308
                                                --------     --------     --------     --------
    Total net sales .......................       85,218      119,582      129,062      121,406
  Gross profit ............................       25,155       38,833       39,468       34,216
  Income from operations ..................        3,260       14,587       14,464        9,333
  Net Income ..............................          800        7,596        7,332        4,762
  Basic earnings per common share .........         0.10         0.94         0.91         0.59
  Diluted earnings per common share .......         0.09         0.91         0.88         0.58
</TABLE>

--------

(1) Certain prior period amounts have been reclassified to conform with the
    current year presentation.

LIQUIDITY AND CAPITAL RESOURCES

         Net cash provided by operating activities was $23.0 million, $15.2
million and $26.8 million in 2000, 1999 and 1998, respectively. Cash flows from
operations increased in 2000 as compared to 1999 due to primarily to lower
working capital requirements. Cash flows from operations decreased $11.6 million
in 1999 as compared to 1998. The decrease in


                                       13
<PAGE>   15

operating cash flow in 1999 was primarily due to higher accounts receivable and
inventory balances at year-end. The increase in accounts receivable was due to
the 15% increase in fourth quarter 1999 sales as compared to the same period in
1998. Increased 1999 year-end inventory balances resulted from higher finished
goods at Alside's Supply Centers due to higher sales and higher raw materials at
its window manufacturing operations due to poor inventory management.
AmerCable's inventory levels increased due to the expansion of its consigned
inventory program in order to ensure its large customers have adequate inventory
in stock.

         In May 1999, the Company amended its existing $50 million bank credit
facility to extend the term of the facility through May 2002. Available
borrowings under the Credit Agreement are limited to the lesser of the total
facility less unused letters of credit or availability based on percentages of
eligible accounts receivable and inventories. The Credit Agreement is secured by
substantially all of the Company's assets other than the Company's owned real
property, equipment and its interest in Amercord. At December 31, 2000, $2.1
million of this facility had been used to secure various insurance letters of
credit. At December 31, 2000 the Company had an available borrowing capacity
under the Credit Agreement of approximately $47.9 million.

         Capital expenditures totaled $11.9 million, $18.9 million and $14.3
million in 2000, 1999 and 1998, respectively. Capital expenditures in 2000 were
used primarily to increase extrusion capacity for window profiles, fencing and
siding products, improve window efficiency and upgrade window information
systems at Alside and increase capacity and processing efficiency at AmerCable.
Expenditures in 1999 were primarily used to complete the new vinyl siding
manufacturing facility in Freeport, Texas, expand extrusion capacity for window
profiles and vinyl fence, expand capacity and increase manufacturing efficiency
for semi-custom cabinets and increase production flexibility and capacity at
AmerCable. Capital expenditures on the new vinyl siding manufacturing plant were
$9.8 million in 1999. 1998 expenditures were primarily used to increase window
welding and assembly capacity and to increase vinyl siding extrusion and
blending capacity, including the construction of the new Freeport vinyl siding
manufacturing plant. Capital expenditures on the new vinyl siding manufacturing
plant were $4.2 million in 1998. The Company has historically funded these
capital expenditure requirements out of cash generated from operating activities
or borrowings under its bank credit facility.

         The Company believes that capital expenditures ranging from $8.0
million to $10.0 million represent a base level of spending needed to maintain
its manufacturing facilities as well as provide for modest increases in capacity
and further automation. The Board of Directors has approved capital expenditures
of $17 million for 2001. Alside's 2001 budget includes expenditures to increase
extrusion capacity for vinyl fence and vinyl windows and for the implementation
of a new financial and ERP system to replace substantially all of Alside's
existing information systems. The implementation of the new ERP system will take
place over a two-year period at an estimated cost of $10.3 million, of which
$4.1 million is expected to be incurred in 2001. Approximately $5.7 million of
the 2001 capital budget has been allocated to AmerCable, primarily to add
additional extrusion capacity.

         In March 1998, the Company completed a tender offer and consent
solicitation with respect to its 11 1/2% Notes. In the tender offer, the Company
purchased $72.9 million of the $75.0 million outstanding principal amount of the
11 1/2% Notes. Simultaneously with the consummation of the tender offer, the
Company issued $75.0 million of 9 1/4% Notes. Concurrently with these
transactions, the Company completed an initial public offering of 2,448,120
shares of Common Stock of which 808,520 shares were sold by the Company. The
remaining 1,639,600 shares were sold by certain of the Company's stockholders,
including the holder of the Class B Common Stock who converted 1,150,000 shares
of Class B Common Stock into Common Stock on a one-to-one basis in connection
with the offering. Net proceeds to the Company, after underwriting discounts and
offering expenses, from the Common Stock and 9 1/4% Note offerings were $11.5
million and $72.4 million, respectively. The Company redeemed the $2.1 million
principal amount of 11 1/2% Notes that remained outstanding in August 1998.

         In connection with the recapitalization of Amercord in November 1999,
the Company guaranteed a $3.0 million note secured by Amercord's real property.
Should the guarantee be exercised by Amercord's lender, the Company and Ivaco
Inc. ("Ivaco") have the option to assume the loan. Ivaco has indemnified the
Company for 50% of any loss under the guarantee.

         Effective October 1, 1998, the Company established an Employee Stock
Purchase Plan ("ESPP"). Employees participating in the ESPP can purchase shares
of Common Stock at a 15% discount to fair market value through payroll
deductions of up to 25% of their eligible compensation. The Company registered
250,000 shares of Common Stock with the Securities and Exchange Commission
("SEC") for issuance pursuant to the ESPP. During 2000, 1999 and 1998, the
Company issued 65,873, 80,919 and 35,327 shares of Common Stock pursuant to
ESPP, resulting in net proceeds to the Company of approximately $848,000,
$851,000 and $225,000, respectively.

         On October 27, 1998 the Company's Board of Directors approved a program
to repurchase up to 800,000 shares of


                                       14
<PAGE>   16

Common Stock in open market transactions depending on market, economic and other
factors. On November 28, 2000 the Company's Board authorized the repurchase of
an additional 800,000 shares under the program for a total of 1.6 million
shares. At December 31, 2000, the Company had repurchased 913,774 shares of
Common Stock under this program at a cost of $11.9 million.

         The Company believes the future cash flows from operations and its
borrowing capacity under its existing Credit Agreement will be sufficient to
satisfy its obligations to pay principal and interest on its outstanding debt,
maintain current operations, provide sufficient capital for presently
anticipated capital expenditures and fund its stock repurchase program. However,
there can be no assurances that the cash so generated by the Company will be
sufficient for these purposes.

EFFECTS OF INFLATION

         The Company believes that the effects of inflation have not been
material to its operating results for each of the past three years. Alside's
principal raw material, vinyl resin, has been subject to rapid price changes,
including in 1999 and 2000. Alside has historically been able to pass on price
increases to its customers. The results of operations for individual quarters
can and have been negatively impacted by a delay between the time of vinyl resin
price increases and price increases in Alside's products. However, over longer
periods of time, the impact of the price increases in vinyl resin tends to not
be material. No assurances can be given that Alside will be able to pass on any
price increases in the future. Alside does not expect any significant change in
the price of vinyl resin for 2001.

FINANCIAL ACCOUNTING STANDARDS

         In June 2000, the Financial Accounting Standards Board issued SFAS No.
138, "Accounting for Derivative Instruments and Hedging Activities--An Amendment
of FASB Statement No. 133." SFAS No. 138 amends the accounting and reporting
standards for certain derivatives and hedging activities such as net settlement
contracts, foreign currency transactions and intercompany derivatives. The
adoption of this statement did not have a material effect on the Company's
financial position, results of operations or cash flows.

CERTAIN FORWARD-LOOKING STATEMENTS

         This report contains "forward-looking statements" as that term is
defined in the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based on the beliefs of, and estimates and
assumptions made by and information currently available to, the Company's
management. When used in this report, the words "anticipate," "believe,"
"estimate," "expect," "intend," and similar words, as they relate to the Company
or the Company's management, identify forward-looking statements. These
statements reflect the current views of the Company's management regarding the
operations and results of operations of the Company as well as its customers and
suppliers. These statements are subject to certain risks and uncertainties. Some
of the factors that might cause a difference are discussed below. Should one or
more of these risks or uncertainties occur, or should management's assumptions
or estimates prove incorrect, actual results and events may vary materially from
those discussed in the forward-looking statements.

         GENERAL INDUSTRY, ECONOMIC, INTEREST RATES AND OTHER CONDITIONS. The
exterior residential building products industry in which Alside operates may be
significantly affected by changes in national and local economic and other
conditions, including employment levels, changing demographic considerations,
availability of financing, interest rates and consumer confidence, all of which
are outside of the Company's control. A prolonged recession affecting the
residential construction industry could result in a significant decrease in the
Company's financial performance.

         SUBSTANTIAL FIXED COSTS. A significant portion of Alside's selling,
general and administrative expenses are fixed costs which do not fluctuate
proportionately with sales. As a result, a percentage decline in Alside's net
sales has a greater percentage effect on Alside's operating income.

         CHANGING RAW MATERIAL COSTS AND AVAILABILITY. The principal raw
material used in producing Alside's vinyl products is vinyl resin, which
historically has changed significantly in price. Although Alside has generally
been able to pass on price increases in vinyl resin to its customers, there can
be no assurance that in the future the market will respond favorably to selling
price increases or that the Company will otherwise be able to absorb these cost
increases without significantly affecting its margins. Additionally, a major
interruption in the delivery of vinyl resin to Alside would disrupt Alside's
operations and could have an adverse effect on the Company's financial condition
and results of operations. Alside has contracts with a vendor to supply
substantially all of its vinyl resin requirements and believes its requirements
could also be met by other suppliers. Copper is the principal raw material used
by AmerCable in the manufacture of its products. Historically, copper has been
subject to rapid price changes. A decrease in the price of copper may also
affect the Company's gross margins as AmerCable generally prices its cable
products based on market prices for copper at the time of

                                       15
<PAGE>   17

shipment. As a result, sudden decreases in copper prices can result in lower
gross profit margins in future periods. See Item 7 -- "Management's Discussion
and Analysis of Financial Condition and Results of Operations" in this report.

         WEATHER IMPACTS QUARTERLY RESULTS. Because most of Alside's building
products are intended for exterior use, sales tend to be lower during periods of
inclement weather. Weather conditions in the first quarter of each calendar year
usually result in that quarter producing significantly less sales revenue than
in any other period of the year. Consequently, the Company has historically had
small profits or losses in the first quarter and reduced profits from operations
in the fourth quarter of each calendar year. See Item 7. -- "Management's
Discussion and Analysis of Financial Condition and Results of Operations --
Quarterly Financial Data" in this report.

         FINANCIAL COVENANT RESTRICTIONS. At December 31, 2000 the Company had
total indebtedness of $75.0 million, compared to stockholders' equity of $98.0
million. In addition, the Company has a $50 million bank credit agreement. At
December 31, 2000, the Company had borrowing capacity of approximately $47.9
million. The Company's bank credit agreement includes covenants that require the
maintenance of certain financial ratios and net worth. This credit agreement
also restricts the Company's ability to repurchase its Common Stock and to pay
dividends. Outstanding borrowings under the bank credit agreement are secured by
substantially all of the assets of the Company other than the Company's real
property, equipment and its interests in Amercord. In addition, the Indenture
under which the Company's 9 1/4% notes were issued contains covenants that,
among other things, limits the Company's ability to incur additional
indebtedness, pay dividends, make certain investments and repurchase stock or
subordinated indebtedness. See Item 7. -- "Management's Discussion and Analysis
of Financial Condition and Results of Operations -- Liquidity and Capital
Resources" in this report.

         COMPETITION FROM OTHER VINYL BUILDING PRODUCT MANUFACTURERS AND
ALTERNATIVE BUILDING PRODUCT MATERIALS. With the exception of Owens Corning, we
believe that no other company within the vinyl residential siding market
competes with Alside in both manufacturing and distribution. However, Alside
does compete with other manufacturers of vinyl building products. Some of these
companies are larger and have greater financial resources than the Company. The
Company also competes with Owens Corning and numerous large and small
distributors of building products in its capacity as a distributor of these
products. Additionally, the Company's products face competition from alternative
materials: wood and aluminum in the window market, and wood, masonry and metal
in the siding market. There can be no assurance the Company will not be
adversely impacted by its competitors or alternative materials. See Item 1. --
"Business -- Alside -- Competition" in this report.

         COSTS OF ENVIRONMENTAL COMPLIANCE. The Company's operations are subject
to various environmental statutes and regulations, including laws and
regulations addressing materials used in the manufacturing of the Company's
products. In addition, certain of the Company's operations are subject to
federal, state and local environmental laws and regulations that impose
limitations on the discharge of pollutants into the air and water and establish
standards for the treatment, storage and disposal of solid and hazardous wastes.
Future expenditures may be necessary as compliance standards and technology
change. Unforeseen significant expenditures required to maintain compliance,
including unforeseen liabilities, could have an adverse effect on the Company's
business and financial condition. See Item 1. -- "Business -- Government
Regulation and Environmental Matters" in this report.


ITEM 7a.       DISCLOSURES ABOUT MARKET RISK

INTEREST RATE RISK

         The Company had $22.5 million in short-term investments at December 31,
2000. The short-term investments are highly liquid with original maturities of
less than six months and are subject to interest-rate risk. The value of these
investments would decline in the event of increases in market interest rates.
The Company generally holds these investments until maturity thus avoiding the
losses resulting from sudden changes in interest rates. Declines in interest
rates would reduce the amount of the Company's interest income. A 100 basis
point decrease in interest rates would have decreased interest income for 2000
by approximately $173,000.

         The Company borrows under its revolving credit facility from time to
time for general corporate purposes, including working capital requirements and
capital expenditures. Borrowings under the revolving credit facility bear
interest at either the prime commercial rate or LIBOR plus 1.00% at the option
of the Company. Therefore, the Company is also subject to fluctuations in
interest rates as a result of the terms of this credit facility. At December 31,
2000, the Company had no borrowings under its revolving credit facility.

         The Company has $75.0 million of Senior Subordinated Notes due 2008
that bear a fixed interest rate of 9 1/4%. The fair value of the Company's
9 1/4% Notes is sensitive to changes in interest rates.


                                       16
<PAGE>   18

FOREIGN CURRENCY EXCHANGE RATE RISK

         The Company's revenues are primarily from domestic customers and are
realized in U.S. dollars. Accordingly, the Company believes its direct foreign
currency exchange rate risk is not material. In the past, the Company has hedged
against foreign currency exchange rate fluctuations on specific sales or
equipment purchasing contracts. At December 31, 2000 the Company had no currency
hedges in place.

COMMODITY PRICE RISK

         Copper is one of the primary raw materials used by its AmerCable
division. A decrease in the price of copper may affect the Company's gross
margins as AmerCable generally prices its cable products based on market prices
for copper at the time of shipment. As a result, sudden decreases in copper
prices can result in lower gross profit margins in future periods. The Company
from time to time uses forward contracts as a hedge against changes in copper
prices for specific contracts. At December 31, 2000, no raw material forward
contracts were in place. See Item 7 -- "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Certain Forward-Looking
Statements -- Changing Raw Material Costs and Availability" in this report.


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


                        ASSOCIATED MATERIALS INCORPORATED
                          INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
                                                                                                    Page
                                                                                                    ----
<S>                                                                                                  <C>
     Report of Independent Auditors...............................................................   18
     Balance Sheets as of December 31, 2000 and 1999..............................................   19
     Statements of Operations for the years ended December 31, 2000, 1999 and 1998................   20
     Statements of Stockholders' Equity for the years ended December 31, 2000, 1999 and 1998......   21
     Statements of Cash Flows for the years ended December 31, 2000, 1999 and 1998................   22
     Notes to Financial Statements................................................................   23
</TABLE>


                                       17
<PAGE>   19



                REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS


The Board of Directors and Stockholders
Associated Materials Incorporated

We have audited the accompanying balance sheets of Associated Materials
Incorporated as of December 31, 2000 and 1999 and the related statements of
operations, stockholders' equity, and cash flows for each of the three years in
the period ended December 31, 2000. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Associated Materials
Incorporated at December 31, 2000 and 1999, and the results of its operations
and its cash flows for each of the three years in the period ended December 31,
2000, in conformity with accounting principles generally accepted in the United
States.


                                                ERNST & YOUNG LLP

Dallas, Texas
February 9, 2001



                                       18
<PAGE>   20

                        ASSOCIATED MATERIALS INCORPORATED
                                 BALANCE SHEETS
                        (IN THOUSANDS, EXCEPT SHARE DATA)


<TABLE>
<CAPTION>
                                                                                         DECEMBER 31,
                                                                                    ----------------------
                                                                                      2000         1999
                                                                                    ---------    ---------
<S>                                                                                 <C>          <C>

                                     ASSETS


Current assets:
    Cash and cash equivalents ...................................................   $  15,879    $   3,432
    Short term investment .......................................................       5,019         --
    Accounts receivable, net of allowance for doubtful accounts of $6,168
       and $4,864 at December 31, 2000 and 1999, respectively ...................      50,853       52,583
    Inventories .................................................................      74,429       69,651
    Income taxes receivable .....................................................         453          226
    Other current assets ........................................................       4,213        3,872
                                                                                    ---------    ---------
Total current assets ............................................................     150,846      129,764
Property, plant and equipment, net ..............................................      73,917       71,682
Investment in Amercord Inc. .....................................................       2,393        2,393
Other assets ....................................................................       3,985        2,457
                                                                                    ---------    ---------
Total assets ....................................................................   $ 231,141    $ 206,296
                                                                                    =========    =========


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
    Accounts payable ............................................................   $  19,273    $  16,933
    Accrued liabilities .........................................................      29,509       26,953
                                                                                    ---------    ---------
Total current liabilities .......................................................      48,782       43,886
Deferred income taxes ...........................................................       3,927        2,236
Other liabilities ...............................................................       5,442        5,848
Long-term debt ..................................................................      75,000       75,000
Commitments and Contingencies
Stockholders' equity:
    Preferred stock, $.01 par value:
        Authorized shares - 100,000 shares at December 31, 2000 and 1999
        Issued shares - 0 at December 31, 2000 and 1999 .........................        --           --
    Common stock, $.0025 par value:
        Authorized shares - 15,000,000 at December 31, 2000 and 1999 Issued
        shares - 7,164,024 at December 31, 2000 and 7,024,666 at
           December 31, 1999 ....................................................          18           17
    Common stock Class B, $.0025 par value:
        Authorized and issued shares - 1,550,000 at December 31, 2000 and
           December 31, 1999 ....................................................           4            4
    Less:  Treasury stock, at cost - 955,170 shares at December 31, 2000 and
        555,396 at December 31, 1999 ............................................     (12,425)      (6,626)
    Capital in excess of par ....................................................      14,862       13,154
    Retained earnings ...........................................................      95,531       72,777
                                                                                    ---------    ---------
Total stockholders' equity ......................................................      97,990       79,326
                                                                                    ---------    ---------
Total liabilities and stockholders' equity ......................................   $ 231,141    $ 206,296
                                                                                    =========    =========
</TABLE>


                             See accompanying notes.


                                       19
<PAGE>   21

                        ASSOCIATED MATERIALS INCORPORATED
                            STATEMENTS OF OPERATIONS
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)


<TABLE>
<CAPTION>
                                                                YEAR ENDED DECEMBER 31,
                                                          ---------------------------------
                                                             2000        1999        1998
                                                          ---------   ---------   ---------
<S>                                                       <C>         <C>         <C>
Net sales .............................................   $ 499,393   $ 455,268   $ 410,111
Cost of sales .........................................     353,994     317,596     285,822
                                                          ---------   ---------   ---------
Gross profit ..........................................     145,399     137,672     124,289
Selling, general and administrative ...................     107,255      96,028      88,727
Other income, net .....................................        --          --         2,673
                                                          ---------   ---------   ---------
Income from operations ................................      38,144      41,644      38,235
Interest expense, net .................................       6,046       6,779       7,565
                                                          ---------   ---------   ---------
                                                             32,098      34,865      30,670
Gain on the sale of UltraCraft ........................       8,012        --          --
Equity in loss of Amercord Inc. .......................        --         1,337       1,881
Writedown of investment in Amercord Inc. ..............        --          --         4,351
                                                          ---------   ---------   ---------
Income before income tax and extraordinary item .......      40,110      33,528      24,438
Income tax expense ....................................      16,555      13,038      11,382
                                                          ---------   ---------   ---------
Income before extraordinary item ......................      23,555      20,490      13,056

Extraordinary loss from retirement of debt, net of
    income taxes ......................................        --          --         4,107
                                                          ---------   ---------   ---------

Net income ............................................   $  23,555   $  20,490   $   8,949
                                                          =========   =========   =========

Earnings Per Common Share - Basic:

Income before extraordinary item ......................   $    2.94   $    2.52   $    1.58

Extraordinary loss from retirement of debt ............        --          --         (0.50)
                                                          ---------   ---------   ---------

Net income ............................................   $    2.94   $    2.52   $    1.08
                                                          =========   =========   =========

Earnings Per Common Share - Assuming Dilution:

Income before extraordinary item ......................   $    2.85   $    2.46   $    1.55

Extraordinary loss from retirement of debt ............        --          --         (0.49)
                                                          ---------   ---------   ---------

Net income ............................................   $    2.85   $    2.46   $    1.06
                                                          =========   =========   =========
</TABLE>


                             See accompanying notes.


                                       20
<PAGE>   22

                        ASSOCIATED MATERIALS INCORPORATED
                       STATEMENTS OF STOCKHOLDERS' EQUITY
                                 (IN THOUSANDS)




<TABLE>
<CAPTION>
                                                               CLASS B                         CAPITAL
                                           COMMON STOCK      COMMON STOCK   TREASURY STOCK        IN                    TOTAL
                                          ---------------  --------------  ----------------     EXCESS    RETAINED   STOCKHOLDERS'
                                          SHARES  AMOUNT   SHARES  AMOUNT  SHARES    AMOUNT     OF PAR    EARNINGS     EQUITY
                                          ------- ------   ------  ------  ------  --------    --------   --------   ------------
<S>                                        <C>     <C>     <C>     <C>     <C>     <C>         <C>        <C>        <C>
Balance at December 31, 1997 ...........   4,935   $12      2,700    $ 7      41   $   (542)   $    505   $ 44,752    $ 44,734
  Net income and total
     comprehensive income ..............      --    --         --     --      --         --          --      8,949       8,949
  Cash dividends ($0.075 per share) ....      --    --         --     --      --         --          --       (569)       (569)
  Exercise of Common Stock
     options and related tax
     benefits ..........................      10    --         --     --      --         --          60         --          60
  Purchase of treasury shares ..........      --    --         --     --      47       (506)         --         --        (506)
  Common Stock issued ..................     809     2         --     --      --         --      11,483         --      11,485
  Common Stock issued under
     Employee Stock Purchase
     Plan ..............................      35    --         --     --      --         --         225         --         225
  Conversion of Class B Common
     Stock to Common Stock .............   1,150     3     (1,150)    (3)     --         --          --         --          --
                                           -----   ---     ------    ---    ----   --------    --------   --------    --------
Balance at December 31, 1998 ...........   6,939    17      1,550      4      88     (1,048)     12,273     53,132      64,378
  Net income and total
     comprehensive income ..............      --    --         --     --      --         --          --     20,490      20,490
  Cash dividends ($0.10 per share) .....      --    --         --     --      --         --          --       (845)       (845)
  Exercise of Common Stock
     options and related tax
     benefits ..........................       5    --         --     --      --         --          30         --          30
  Purchase of treasury shares ..........      --    --         --     --     467     (5,578)         --         --      (5,578)
  Common Stock issued under
     Employee Stock Purchase
     Plan ..............................      81    --         --     --      --         --         851         --         851
                                           -----   ---     ------    ---    ----   --------    --------   --------    --------
Balance at December 31, 1999 ...........   7,025    17      1,550      4     555     (6,626)     13,154     72,777      79,326
  Net income and total
     comprehensive income ..............      --    --         --     --      --         --          --     23,555      23,555
  Cash dividends ($0.10 per share) .....      --    --         --     --      --         --          --       (801)       (801)
  Exercise of Common Stock
     options and related tax
     benefits ..........................      73    --         --     --      --         --         860         --         860
  Purchase of treasury shares ..........      --    --         --     --     400     (5,799)         --         --      (5,799)
  Common Stock issued under
     Employee Stock Purchase
     Plan ..............................      66     1         --     --      --         --         848         --         849
                                           -----   ---     ------    ---    ----   --------    --------   --------    --------
Balance at December 31, 2000 ...........   7,164   $18      1,550    $ 4     955   $(12,425)   $ 14,862   $ 95,531    $ 97,990
                                           =====   ===     ======    ===    ====   ========    ========   ========    ========
</TABLE>


                             See accompanying notes.



                                       21
<PAGE>   23


                        ASSOCIATED MATERIALS INCORPORATED
                            STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)


<TABLE>
<CAPTION>
                                                                              YEAR ENDED DECEMBER 31,
                                                                         --------------------------------
                                                                           2000        1999        1998
                                                                         --------    --------    --------
<S>                                                                      <C>         <C>         <C>
OPERATING ACTIVITIES
Net income ...........................................................   $ 23,555    $ 20,490    $  8,949
Adjustments to reconcile net income to net cash used by operating
activities:
   Depreciation and amortization .....................................      9,550       8,519       7,217
   Deferred income taxes .............................................      1,691        (380)        665
   Provision for losses on accounts receivable .......................      2,884       2,323       3,500
   Equity in loss of Amercord Inc. ...................................         --       1,337       1,881
   Writedown of investment in Amercord Inc. ..........................         --          --       4,351
   Loss on sale of assets ............................................        558          51          30
   Extraordinary loss on retirement of debt, net of income taxes .....         --          --       4,107
   Other income, net .................................................         --          --      (2,673)
   Gain on the sale of UltraCraft ....................................     (8,012)         --          --
   Changes in operating assets and liabilities:
      Accounts receivable ............................................     (3,492)     (9,150)        (59)
      Inventories ....................................................     (5,180)    (13,406)        376
      Other current assets ...........................................       (677)       (300)       (281)
      Bank overdrafts ................................................         --          --      (4,769)
      Accounts payable ...............................................      1,882       5,220      (3,370)
      Accrued liabilities ............................................      2,556       1,536       3,415
      Income taxes receivable/payable ................................       (135)       (793)      3,757
      Other assets ...................................................     (1,804)        (38)         66
      Other liabilities ..............................................       (408)       (165)       (363)
                                                                         --------    --------    --------
Net cash provided by operating activities ............................     22,968      15,244      26,799

INVESTING ACTIVITIES
Additions to property, plant and equipment ...........................    (11,925)    (18,915)    (14,261)
Proceeds from sale of assets .........................................         86          65          49
Purchase of Alpine Industries, Inc. assets ...........................     (7,565)         --          --
Proceeds from the sale of UltraCraft .................................     18,885          --          --
Purchase of short-term investment ....................................     (5,019)         --          --
Proceeds from sale of Amercord interest ..............................         --       1,231          --
Investment in Amercord Inc. ..........................................         --          --        (500)
                                                                         --------    --------    --------
Net cash used in investing activities ................................     (5,538)    (17,619)    (14,712)

FINANCING ACTIVITIES
Proceeds from issuance of long-term debt .............................         --          --      75,000
Net proceeds from issuance of common stock ...........................        849         851      11,710
Net decrease in revolving line of credit .............................         --          --        (564)
Principal payments of long-term debt .................................         --      (3,600)     (1,750)
Principal payments of 11 1/2% Senior Subordinated Notes ..............         --          --     (75,000)
Prepayment premium on early retirement of debt .......................         --          --      (4,899)
Debt issuance costs ..................................................         --          --      (2,509)
Options exercised ....................................................        768          15          29
Dividends paid .......................................................       (801)       (845)       (569)
Treasury stock acquired ..............................................     (5,799)     (5,578)       (506)
                                                                         --------    --------    --------
Net cash provided by (used in) financing activities ..................     (4,983)     (9,157)        942
                                                                         --------    --------    --------
Net increase (decrease) in cash ......................................     12,447     (11,532)     13,029
Cash at beginning of period ..........................................      3,432      14,964       1,935
                                                                         --------    --------    --------
Cash at end of period ................................................   $ 15,879    $  3,432    $ 14,964
                                                                         ========    ========    ========
Supplemental Information:
    Cash paid for interest ...........................................   $  7,177    $  7,108    $  8,924
                                                                         ========    ========    ========
    Cash paid for income taxes .......................................   $ 15,292    $ 14,313    $  8,259
                                                                         ========    ========    ========
</TABLE>

                             See accompanying notes.


                                       22
<PAGE>   24


                        ASSOCIATED MATERIALS INCORPORATED
                          NOTES TO FINANCIAL STATEMENTS


1.       ACCOUNTING POLICIES

     Line of Business

         Associated Materials Incorporated (the "Company") consists of two
operating divisions, Alside and AmerCable. Alside is engaged principally in the
manufacture and distribution of exterior residential building products to
professional contractors throughout the United States. AmerCable manufactures
jacketed electrical cable utilized in a variety of industrial applications. The
Company also owns an interest in Amercord Inc. ("Amercord"), which was accounted
for using the equity method until November 1999 when Amercord was recapitalized,
reducing the Company's interest in Amercord from 50% to 9.9%. Since the
recapitalization, the Company has accounted for Amercord under the cost method.
Amercord manufactures and sells steel tire cord and tire bead wire used in the
tire manufacturing industry.

     New Accounting Pronouncements

         In June 1998, the Financial Accounting Standards Board issued SFAS No.
133, "Accounting for Derivative Instruments and Hedging Activities" which is
effective for fiscal years beginning after June 15, 1999. The Statement
establishes accounting and reporting standards for derivative instruments and
requires that a company recognize all derivatives as either assets or
liabilities in the statement of financial position and measure those instruments
at fair value. In June 1999, the Financial Accounting Standards Board issued
SFAS No. 137, "Deferral of the Effective Date of FASB Statement 133" which
defers the implementation of Statement 133 for one year. In June 2000, the
Financial Accounting Standards Board issued SFAS No. 138, "Accounting for
Derivative Instruments and Hedging Activities--An Amendment of FASB Statement
No. 133." SFAS No. 138 amends the accounting and reporting standards for certain
derivatives and hedging activities such as net settlement contracts, foreign
currency transactions and intercompany derivatives. The adoption of these
statements did not have a material effect on the Company's financial position,
results of operations or cash flows.

         In September 2000, the Emerging Issues Task Force issued EITF 00-10,
"Accounting for Shipping and Handling Fees and Costs" which is effective for the
fourth quarter of 2000. The EITF concluded that amounts billed to a customer in
a sale transaction related to shipping and handling should be classified as
revenue. The EITF also concluded that if costs incurred related to shipping and
handling are significant and not included in cost of sales, an entity should
disclose both the amount of such costs and the line item on the income statement
that includes such costs. Prior to implementing EITF 00-10, the Company
classified shipping and handling amounts billed to a customer as revenue. Costs
incurred related to shipping and handling were classified as a reduction of
revenue. The Company has reclassified prior period information to conform with
the provisions of EITF 00-10.

         In December 1999, the Securities and Exchange Commission ("SEC") issued
SAB No. 101, "Revenue Recognition in Financial Statements" which provides the
SEC's views on applying generally accepted accounting principles to selected
revenue recognition issues. The Company adopted SAB 101 during 2000. The
adoption of SAB 101 had no effect on the Company's results of operations for any
period.

     Revenue Recognition

         Product sales are recognized at the time of shipment and when payment
is reasonably certain.

     Inventories

         Inventories are valued at the lower of cost (first-in, first-out) or
market.

     Property, Plant and Equipment

         Property, plant and equipment are stated at cost. Depreciation is
provided by the straight-line method over the estimated useful lives of the
assets which range from 3 to 30 years.


     Income Tax

         Income taxes have been provided using the liability method in
accordance with Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes."



                                       23
<PAGE>   25

                        ASSOCIATED MATERIALS INCORPORATED
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


     Cash and Cash Equivalents

         The Company considers all highly liquid investments with an original
maturity of three months or less to be cash equivalents.

     Short-Term Investment

         At December 31, 2000 the Company has a $5.0 million commercial paper
investment, with an original maturity of six months, reported as a short-term
investment on the balance sheet. The Company classified the investment as
held-to-maturity as the Company has the intent and ability to hold the
investment to maturity. The investment is carried at amortized cost.

     Derivatives

         From time to time the Company hedges its position with respect to raw
material or currency fluctuations on specific contracts by entering into forward
contracts or purchase options, the cost of which are realized upon the
completion of the contract. No such contracts were in place at December 31,
2000.

     Interest Income

         Interest income was $1.1 million, $329,000 and $413,000 in 2000, 1999
and 1998, respectively, and is included in interest expense, net.

     Use of Estimates

         The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions regarding the reported amounts of assets and liabilities, disclosure
of contingent assets and liabilities at the date of the financial statements,
and the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

     Advertising

         The Company expenses advertising costs as incurred. Advertising expense
was $9.2 million, $8.5 million and $8.7 million in 2000, 1999 and 1998,
respectively.

     Reclassifications

         Certain prior period amounts have been reclassified to conform with the
current period presentation.


2.       INVESTMENT IN AMERCORD

         The Company owns a 9.9% interest in Amercord, a manufacturer of steel
tire cord and tire bead wire used in the tire manufacturing industry.

         During 1998, the Company announced its intention to sell its 50%
interest in Amercord. The Company recorded a pretax write-down of $4,351,000
($0.38 per share after tax) on its investment in Amercord in anticipation of a
loss on the sale of Amercord.

         During the fourth quarter of 1999, Amercord was recapitalized, reducing
the Company's interest in Amercord from 50% to 9.9%. As a result of the
recapitalization, the Company received cash of $1.2 million (net of related
expenses) and a subordinated note for $1.5 million due November 2004. In
addition, the Company has the right to require Amercord to purchase the
Company's remaining 9.9% interest for $2.0 million in November 2003. The Company
currently accounts for Amercord using the cost method of accounting. Prior to
Amercord's recapitalization, the Company accounted for Amercord using the equity
method of accounting. The Company recorded equity in the losses of Amercord of
$1.3 million and $1.9 million in 1999 and 1998, respectively.


                                       24
<PAGE>   26


                        ASSOCIATED MATERIALS INCORPORATED
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


         The Company has guaranteed a $3.0 million note secured by Amercord's
real property. Should the guarantee be exercised by Amercord's lender, the
Company and Ivaco Inc. ("Ivaco") have the option to assume the loan. Ivaco has
indemnified the Company for 50% of any loss under the guarantee.

         The fair value of the $1.5 million note and the 9.9% equity ownership
(taking into consideration the $2.0 million put option) at December 31, 2000 was
$1.2 million and $1.1 million, respectively. These amounts are listed as
Investment in Amercord Inc. in the accompanying balance sheets.


3.       ALLOWANCE FOR DOUBTFUL ACCOUNTS

         Changes in the allowance for doubtful accounts on accounts receivable
for the years ended December 31 consist of (in thousands):

<TABLE>
<CAPTION>
                                                    2000     1999     1998
                                                   ------   ------   ------
<S>                                                <C>      <C>      <C>
Balance at beginning of period .................   $4,864   $4,159   $4,423
  Provision for losses .........................    2,884    2,323    3,500
  Losses sustained (net of recoveries) .........    1,358    1,618    3,764
  Allowance for UltraCraft receivables sold ....      222       --       --
                                                   ------   ------   ------
Balance at end of period .......................   $6,168   $4,864   $4,159
                                                   ======   ======   ======
</TABLE>



4.       INVENTORIES

         Inventories at December 31 consist of (in thousands):

<TABLE>
<CAPTION>
                                            2000     1999
                                          -------   -------
<S>                                       <C>       <C>
Raw materials .........................   $23,229   $20,043
Work-in-progress ......................     5,101     5,937
Finished goods and purchased stock ....    46,099    43,671
                                          -------   -------
                                          $74,429   $69,651
                                          =======   =======
</TABLE>


5.       PROPERTY, PLANT AND EQUIPMENT

         Property, plant and equipment at December 31 consist of (in thousands):


<TABLE>
<CAPTION>
                                       2000       1999
                                     --------   --------
<S>                                  <C>        <C>
Land .............................   $  1,878   $  1,939
Buildings ........................     29,601     30,472
Construction in process ..........      1,985      3,281
Machinery and equipment ..........    106,596     98,106
                                     --------   --------
                                      140,060    133,798
Less accumulated depreciation ....     66,143     62,116
                                     --------   --------
                                     $ 73,917   $ 71,682
                                     ========   ========
</TABLE>


6.       ACCRUED LIABILITIES AND OTHER LIABILITIES

         Accrued liabilities at December 31 consist of (in thousands):

<TABLE>
<CAPTION>
                                        2000       1999
                                       -------   -------
<S>                                    <C>       <C>
Employee compensation ..............   $12,450   $11,419
Sales promotions and incentives ....     6,813     4,635
Employee benefits ..................     3,450     4,054
Interest ...........................     2,313     2,326
Other ..............................     4,483     4,519
                                       -------   -------
                                       $29,509   $26,953
                                       =======   =======
</TABLE>


                                       25
<PAGE>   27

                        ASSOCIATED MATERIALS INCORPORATED
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


Other liabilities of $5,442,000 and $5,848,000 at December 31, 2000 and 1999,
respectively, consist primarily of accruals for retiree medical benefits related
to the 1989 closure of the Company's metal plant.

7.       REVOLVING CREDIT ARRANGEMENTS

         In May 1999, the Company amended its $50 million credit agreement with
KeyBank, N.A. ("Credit Agreement") to extend the term to May 31, 2002. Available
borrowings under the Credit Agreement are limited to the lesser of the total
facility less unused letters of credit or availability based on percentages of
eligible accounts receivable and inventories. Unused letters of credit totaled
$2,116,000 at December 31, 2000, primarily related to insurance. The Company's
available borrowing capacity at December 31, 2000 was approximately $47,884,000.
The Credit Agreement includes covenants that require the maintenance of certain
financial ratios and net worth and that place restrictions on the repurchase of
common stock and the payment of dividends. Outstanding borrowings under the
Credit Agreement are secured by substantially all of the assets of the Company
other than the Company's real property, equipment and its interest in Amercord.

         Interest is payable on borrowings under the revolving credit facility
at either the prime commercial rate (9.5% at December 31, 2000) or LIBOR plus
1.00% at the option of the Company and on the unused credit facility at a rate
of .20%. Letter of credit fees of 1.125% are paid at origination.

         The weighted average interest rate for borrowings under the revolving
credit facility was 8.36% and 7.75% for December 31, 2000 and 1999,
respectively.


8.       LONG-TERM DEBT

         Long-term debt at December 31, 2000 and 1999 consists of $75 million of
9 1/4% Senior Subordinated Notes due 2008. The fair value of the 9 1/4% Notes at
December 31, 2000 was $71,625,000 based upon quoted market price.

         In March 1998, the Company purchased $72,900,000 principal amount of
its outstanding 11 1/2% Senior Subordinated Notes due August 15, 2003 ("11 1/2%
Notes") through a tender offer and consent solicitation. As a result of this
transaction, the Company incurred an extraordinary charge of $4,054,000, net of
income taxes of $2,841,000, resulting from the premium paid in connection with
the purchase of the 11 1/2% Notes and the write-off of debt issuance costs
associated with the 11 1/2% Notes.

         Simultaneously with the consummation of the tender offer, the Company
issued $75,000,000 of 9 1/4% Senior Subordinated Notes due March 1, 2008 (the
"9 1/4% Notes") with interest payable semi-annually on March 1 and September 1
commencing September 1, 1998. The 9 1/4% Notes are senior subordinated unsecured
obligations of the Company and are subordinated in right of payment to all
existing and future "Senior Indebtedness" of the Company (as that term is
defined in the indenture pursuant to which the 9 1/4% Notes were issued (the
"9 1/4% Note Indenture")).

         The 9 1/4% Notes are redeemable at the Company's option, in whole or in
part, at any time on or after March 1, 2003, at redemption prices ranging from
104.625% commencing on March 1, 2003 and reducing to 100% on March 1, 2006 and
thereafter. The 9 1/4% Note Indenture includes certain covenants that limit the
Company's ability to incur additional indebtedness, pay dividends and make other
restrictive payments and consummate certain transactions.

         On August 17, 1998, the Company redeemed the $2,100,000 principal
amount of 11 1/2% Notes that remained outstanding after the tender offer. As a
result of this transaction, the Company incurred an extraordinary charge of
approximately $53,000, net of income taxes of $37,000, resulting from the
premium paid in connection with the redemption.


9.       ACQUISITIONS AND DIVESTITURES

         On October 6, 2000, the Company acquired substantially all of the
assets of Alpine Industries, Inc. for $7.6 million in cash and the assumption of
certain payroll related and property tax liabilities. Included in the acquired
assets is Alpine's leased window fabrication facility located in Bothell,
Washington. This facility manufactures vinyl windows for the new construction,
manufactured housing and remodeling markets. The Company accounted for the
acquisition using the

                                       26
<PAGE>   28

                        ASSOCIATED MATERIALS INCORPORATED
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


purchase method of accounting and the results of operations have been included
in the Company's income statement from the date of acquisition.

         The Company completed the sale of its UltraCraft operation, a
manufacturer of semi-custom frameless cabinets, in June 2000. Pre-tax net
proceeds from the sale were $18.9 million after working capital adjustments and
transaction costs. The Company recorded a pre-tax gain on the sale of $8.0
million. UltraCraft represented approximately 5% of the Company's 1999 net
sales.

         Under the terms of the 9 1/4% Note Indenture, the Company is obligated
to make an offer to repurchase the 9 1/4% Notes using the after-tax net proceeds
from the UltraCraft sale, to the extent the Company does not use these net
proceeds within one year of the sale to repay senior indebtedness or to acquire
assets used in, or other businesses similar to, the business currently conducted
by the Company. As a result of the Company's acquisition of the Alpine assets
together with other capital expenditures, the Company believes that it is not
obligated to make an offer to repurchase the notes.


10.      COMMITMENTS

         Commitments for future minimum lease payments under noncancelable
operating leases, principally for manufacturing and distribution facilities and
certain equipment, are approximately $11,529,000, $10,215,000, $8,083,000,
$5,914,000, $3,417,000 and $2,856,000 for the years ending December 31, 2001,
2002, 2003, 2004, 2005 and thereafter, respectively. Lease expense was
approximately $14,673,000, $13,141,000 and $12,171,000 for the years ended
December 31, 2000, 1999 and 1998, respectively. The Company's lease agreements
typically contain renewal options.


11.      INCOME TAXES

         Income tax expense for the years ended December 31 consists of (in
thousands):

<TABLE>
<CAPTION>
                                   2000                   1999                     1998
                            -------------------   --------------------    -------------------
                            Current    Deferred    Current    Deferred     Current   Deferred
                            --------   --------   --------    --------    --------   --------
<S>                         <C>        <C>        <C>         <C>         <C>        <C>
Federal income taxes ....   $ 13,800   $  1,510   $ 11,776    $   (364)   $  6,366   $    542
State income taxes ......      1,064        181      1,642         (16)      1,473        123
                            --------   --------   --------    --------    --------   --------
                            $ 14,864   $  1,691   $ 13,418    $   (380)   $  7,839   $    665
                            ========   ========   ========    ========    ========   ========
</TABLE>


         Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amount of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes. Significant
components of the Company's deferred income taxes as of December 31 are as
follows (in thousands):

<TABLE>
<CAPTION>
                                          2000       1999
                                        --------    --------
<S>                                     <C>         <C>
Deferred tax assets:
   Medical benefits .................   $  2,095    $  2,252
   Bad debt expense .................      1,979       1,052
   Pension expense ..................       (302)        305
   Inventory costs ..................      1,108         833
   Capital loss on Amercord Inc. ....        472       3,564
   Other ............................        616         782
                                        --------    --------
Total deferred tax assets ...........      5,968       8,788
Deferred tax liabilities:
   Depreciation .....................      8,975      10,507
   Other ............................        920         517
                                        --------    --------
Total deferred tax liabilities ......      9,895      11,024
                                        --------    --------
Net deferred tax liabilities ........   $ (3,927)   $ (2,236)
                                        ========    ========
</TABLE>



                                       27
<PAGE>   29


                        ASSOCIATED MATERIALS INCORPORATED
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


         The reconciliation of the statutory rate to the Company's effective
income tax rate for the years ended December 31 follows:

<TABLE>
<CAPTION>
                                                           2000    1999    1998
                                                           ----    ----    ----
<S>                                                        <C>     <C>     <C>
Statutory rate .........................................   35.0%   35.0%   35.0%
State income tax, net of federal income tax benefit ....    2.0     3.2     5.5
Equity in loss of Amercord .............................     --      --     6.0
Other ..................................................    4.3     0.7     1.2
                                                           ----    ----    ----
Effective rate .........................................   41.3%   38.9%   47.7%
                                                           ====    ====    ====
</TABLE>


         During the third quarter 2000, the Company recorded $1.1 million in
additional income tax expense due to an adjustment to a deferred tax asset,
which was recorded in 1986 pursuant to the spin-off of the Company's tire cord
operation into Amercord. The effect of this adjustment is included in the other
category in the rate reconciliation. Exclusive of this adjustment, the Company's
effective tax rate would have been 38.5%.


12.      STOCKHOLDERS' EQUITY

         In March 1998, the Company completed an initial public offering ("IPO")
of 2,448,120 shares of common stock at an offering price to the public of $16.00
per share. In the IPO, 808,520 shares were sold by the Company and 1,639,600
shares were sold by certain of the Company's stockholders. The offering resulted
in an increase in stockholders' equity of $11,485,000.

         In connection with the IPO, 1,150,000 shares of Class B common stock
were converted into 1,150,000 shares of common stock. The Class B common stock
is convertible on a one-for-one basis into common stock at any time subject to
legal restrictions, if any, applicable to the holder of these shares. The Class
B common stock has the same rights and privileges extended to the common stock
except that the holder of Class B common stock may vote only on matters
pertaining to changes in the Certificate of Incorporation; the sale, lease, or
disposition of certain assets; mergers or consolidations; or the liquidation or
dissolution of the Company.

         In October 1998 the Company's Board of Directors approved a stock
repurchase program that authorized the Company to purchase up to 800,000 shares
of common stock in open market transactions depending on market, economic and
other factors. In November 2000, the Board authorized increasing the Company's
stock repurchase program by an additional 800,000 shares, bringing the total
number of shares under the plan to 1,600,000 shares. During 2000, 1999 and 1998,
the Company repurchased 399,774, 467,000 and 47,000 shares of its common stock
under the stock repurchase program at a cost of $5,799,000, $5,578,000 and
$506,000.


13.      EARNINGS PER SHARE

         The following table sets forth the computation of basic and diluted
earnings per share:

<TABLE>
<CAPTION>
                                                                             YEAR ENDED DECEMBER 31,
                                                                           ---------------------------
                                                                             2000      1999     1998
                                                                           -------   -------   -------
                                                                      (IN THOUSANDS, EXCEPT PER SHARE DATA)
<S>                                                                        <C>       <C>       <C>
Numerator:
       Numerator for basic and diluted earnings per common share --
            income before extraordinary item ...........................   $23,555   $20,490   $13,056
Denominator:
       Denominator for basic earnings per common share --
            weighted-average shares ....................................     8,007     8,126     8,260
       Effect of dilutive securities:
            Employee stock options .....................................       251       218       143
                                                                           -------   -------   -------
       Denominator for diluted earnings per common share --
            adjusted weighted-average shares ...........................     8,258     8,344     8,403
                                                                           =======   =======   =======
Basic earnings per common share before extraordinary item ..............   $  2.94   $  2.52   $  1.58
                                                                           =======   =======   =======
Diluted earnings per common share before extraordinary item ............   $  2.85   $  2.46   $  1.55
                                                                           =======   =======   =======
</TABLE>


                                       28
<PAGE>   30


                        ASSOCIATED MATERIALS INCORPORATED
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


         Options to purchase 50,000 and 40,000 shares of common stock with a
weighted average exercise price of $16.11 and $16.00 per share were outstanding
for the years ended December 31, 2000 and December 31, 1999, respectively, but
were excluded from the diluted earnings per share calculation because the option
exercise price was greater than the average market price of the common stock
during the period.


14.      STOCK PLANS

         The Company has a stock option plan, whereby it grants stock options to
certain directors, officers and key employees. The Company has authorized
800,000 shares of common stock to be issued under the plan. Options were granted
at fair market value on the grant date and are exercisable for ten years.
Options vest by either of the following methods: 50% vests upon the grant date
with the other 50% vesting after two years or 20% vests upon the grant date with
an additional 20% vesting each year commencing on the first anniversary of the
grant date. All outstanding options granted under the stock option plan are
non-statutory stock options.

         Transactions during 1998, 1999 and 2000 under this plan are summarized
below:

<TABLE>
<CAPTION>

                                                                                          WEIGHTED AVERAGE
                                                    SHARES                PRICE            EXERCISE PRICE
                                                    -------        ------------------     ----------------
<S>                                                 <C>            <C>                    <C>
Options outstanding at December 31, 1997......      307,300          $2.925 to $16.00          $  7.79
Exercised.....................................      (10,000)              $2.925               $ 2.925
Granted  .....................................      275,000               $9.00                $  9.00
                                                    -------        ------------------          -------
Options outstanding at December 31, 1998......      572,300          $2.925 to $16.00          $  8.45
Exercised.....................................       (5,000)              $2.925               $ 2.925
                                                    -------        ------------------          -------
Options outstanding at December 31, 1999......      567,300        $ 2.925 to $ 16.00          $  8.50
Exercised.....................................      (73,486)       $  5.00 to $11.875          $  9.57
Granted.......................................      167,500        $11.875 to $16.563          $ 13.50
Expired or canceled...........................      (26,514)       $  9.00 to $11.875          $  9.72
                                                    -------        ------------------          -------
Options outstanding at December 31, 2000......      634,800        $ 2.925 to $16.563          $  9.65
                                                    =======
</TABLE>


         Options to purchase 476,800, 407,800 and 298,800 shares were
exercisable at December 31, 2000, 1999 and 1998, respectively. The weighted
average exercise price of options outstanding was $9.65, $8.50 and $8.45 at
December 31, 2000, 1999 and 1998, respectively.

         The following table summarizes significant ranges of outstanding and
exercisable options at December 31, 2000:

<TABLE>
<CAPTION>
                                  OPTIONS OUTSTANDING
                       -----------------------------------------        OPTIONS EXERCISABLE
                                     WEIGHTED                        ------------------------
                                     AVERAGE        WEIGHTED                     WEIGHTED
                                    REMAINING        AVERAGE                      AVERAGE
      RANGE            SHARES     LIFE IN YEARS   EXERCISE PRICE     SHARES    EXERCISE PRICE
-------------------    -------    -------------   --------------    --------   --------------
<S>                    <C>        <C>             <C>               <C>        <C>
  $2.925 to $5.00      142,300         3.09          $ 3.224         142,300        $ 3.224
  $9.00 to $12.00      342,500         7.28          $10.065         242,500        $10.290
$13.875 to $16.5625    150,000         8.41          $14.788          92,000        $14.993
</TABLE>

         The Company adopted the disclosure provisions of SFAS No. 123 in 1996
but continues to measure stock-based compensation in accordance with APB No. 25.
Pro forma information regarding net income and earnings per share is required by
SFAS No. 123, and has been determined as if the Company had accounted for its
stock options under the fair value method of that statement. The weighted
average fair value at date of grant for options granted during 2000 and 1998
using the Black Scholes method was $12.58 and $7.53 per option, respectively. No
options were granted in 1999. The fair value of the options was estimated at the
date of the grant using the Black Scholes option pricing model with the
following assumptions for 2000 and 1998, respectively: dividend yield of .67%
and 1.0%, volatility factor of the expected market price of the stock of .307
and 1.00, a weighted-average risk free interest rate of 6.38% and 5.45% and an
expected life of the option of 10 years.


                                       29
<PAGE>   31

                        ASSOCIATED MATERIALS INCORPORATED
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


         Stock based compensation costs would have reduced net income by
$977,000, $475,000 and $669,000 or $0.12, $0.06 and $0.08 per basic and diluted
share in 2000, 1999 and 1998, respectively, if the fair values of the options
granted in that year had been recognized as compensation expense on a
straight-line basis over the vesting period of the grant. The pro forma effect
on net income for 2000, 1999 and 1998 may not be representative of the pro forma
effect on net income in future years.

         Effective October 1, 1998 the Company established an Employee Stock
Purchase Plan ("ESPP"). The ESPP allows employees to purchase the Company's
common stock at 85% of the lower of the fair market value on the first day of
the option period or the last day of the option period. The Company registered
250,000 shares of common stock for issuance under the ESPP. Employees purchased
65,873, 80,919 and 35,327 shares under the ESPP at average prices of $12.87,
$10.52 and $6.378 per share during 2000, 1999 and 1998, respectively.


15.      BUSINESS SEGMENTS

         The Company has two reportable segments: building products and
electrical cable products. The principal business activities of the building
products segment are the manufacture of vinyl siding, vinyl windows and the
wholesale distribution of these and other complementary building products
principally to professional home remodeling and new construction contractors.
The principal business activity of the electrical cable segment is the
manufacture and sale of jacketed electrical cable.

         The Company evaluates performance and allocates resources based on
operating profit, which is net sales less operating costs and expenses.



                                       30
<PAGE>   32

                        ASSOCIATED MATERIALS INCORPORATED
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


         Comparative financial data by reportable segment for the years ended
December 31 are as follows (in thousands):

<TABLE>
<CAPTION>
                                                          2000         1999        1998
                                                       ---------    ---------    ---------
<S>                                                    <C>          <C>          <C>
Net sales:
       Building products ...........................   $ 434,845    $ 410,107    $ 357,292
       Electrical cable products ...................      64,548       45,161       52,819
                                                       ---------    ---------    ---------
                                                       $ 499,393    $ 455,268    $ 410,111
                                                       =========    =========    =========

Operating profits (losses):
       Building products ...........................   $  36,300    $  42,408    $  35,188
       Electrical cable products ...................       5,815        2,875        5,774
       Corporate expense ...........................      (3,971)      (3,639)      (2,727)
                                                       ---------    ---------    ---------
                                                       $  38,144    $  41,644    $  38,235
                                                       =========    =========    =========

Identifiable assets:
       Building products ...........................   $ 165,990    $ 167,024    $ 139,279
       Electrical cable products ...................      34,255       26,673       21,213
       Corporate ...................................      30,896       12,599       28,827
                                                       ---------    ---------    ---------
                                                       $ 231,141    $ 206,296    $ 189,319
                                                       =========    =========    =========

Depreciation and amortization:
       Building products ...........................   $   7,767    $   6,900    $   5,719
       Electrical cable products ...................       1,493        1,347        1,181
       Corporate ...................................         290          272          317
                                                       ---------    ---------    ---------
                                                       $   9,550    $   8,519    $   7,217
                                                       =========    =========    =========
Net additions to property, plant and equipment:
       Building products ...........................   $   7,936    $  16,018    $  12,658
       Electrical cable products ...................       3,708        2,897        1,596
       Corporate ...................................         281           --            7
                                                       ---------    ---------    ---------
                                                       $  11,925    $  18,915    $  14,261
                                                       =========    =========    =========
</TABLE>


         Identifiable assets by segment are those used in the Company's
operations in each segment. Corporate assets are principally the Company's cash
and cash equivalents and short term investment. The Company operates principally
in the United States. Neither aggregate export sales nor sales to a single
customer have accounted for 10% or more of consolidated net sales in any of the
years presented.


16.      RETIREMENT PLANS

         The Company sponsors a defined benefit pension plan, The Premium
Building Products Company Hourly Employees Pension Plan ("Premium Plan"), which
covers approximately 250 participants. The Company froze the Alside defined
benefit retirement plan ("Alside Plan") effective December 31, 1998 and replaced
it with a defined contribution plan effective January 1, 1999. As a result of
the plan freeze, the Company recorded a $5,951,000 curtailment gain in 1998.
Prepaid pension and accrued pension liabilities are included in other assets and
accrued liabilities in the accompanying balance sheets.


                                       31
<PAGE>   33

                        ASSOCIATED MATERIALS INCORPORATED
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


         Information regarding the Company's defined benefit plans is as
follows:


<TABLE>
<CAPTION>
                                                                     2000                            1999
                                                         -----------------------------     -----------------------------
                                                            ALSIDE           PREMIUM          ALSIDE          PREMIUM
                                                             PLAN             PLAN             PLAN             PLAN
                                                         ------------     ------------     ------------     ------------
<S>                                                      <C>              <C>              <C>              <C>
CHANGE IN PROJECTED BENEFIT OBLIGATION
Projected benefit obligation at beginning of year ....   $ 26,322,987     $    990,155     $ 25,818,400     $    988,298
Service cost .........................................        221,534           41,091               --           38,144
Interest cost ........................................      1,814,543           74,301        1,845,841           68,168
Plan amendments ......................................             --               --               --               --
Curtailment ..........................................             --               --               --               --
Actuarial (gain) loss ................................     (1,608,232)           7,202         (360,718)         (91,910)
Benefits paid ........................................     (1,017,607)         (12,842)        (980,536)         (12,545)
                                                         ------------     ------------     ------------     ------------
Projected benefit obligation at end of year ..........   $ 25,733,225     $  1,099,907     $ 26,322,987     $    990,155
                                                         ============     ============     ============     ============

CHANGE IN PLAN ASSETS
Fair value of assets at beginning of year ............   $ 34,346,364     $    918,140     $ 30,406,944     $    807,158
Actual return on plan assets .........................       (915,028)         (24,839)       4,919,956          119,427
Employer contributions ...............................             --               --               --            4,100
Benefits paid ........................................     (1,017,607)         (12,842)        (980,536)         (12,545)
                                                         ------------     ------------     ------------     ------------
Fair value of assets at end of year ..................     32,413,729          880,459       34,346,364          918,140

Funded status ........................................      6,680,504         (219,448)       8,023,377          (72,015)
Unrecognized:
    Transition obligation ............................             --           21,301               --           28,402
    Prior service costs ..............................             --           44,125               --           50,367
    Cumulative net gain ..............................     (5,681,834)        (102,245)      (8,638,631)        (226,527)
                                                         ------------     ------------     ------------     ------------
Accrued pension asset (liability) ....................   $    998,670     $   (256,267)    $   (615,254)    $   (219,773)
                                                         ============     ============     ============     ============

KEY ASSUMPTIONS AS OF DECEMBER 31
Discount rate ........................................           7.50%            7.50%            7.50%            7.50%
Long-term rate of return on assets ...................           9.00%            9.00%            9.00%            9.00%
Salary increases .....................................            N/A              N/A              N/A              N/A


NET PERIODIC PENSION COST
Service cost .........................................   $    221,534     $     41,091     $         --     $     38,144
Interest cost ........................................      1,814,543           74,301        1,845,841           68,168
Expected return on assets ............................     (3,040,376)         (82,002)      (2,688,695)         (72,294)
Amortization of unrecognized:
    Transition obligation ............................             --            7,101               --            7,101
    Prior service costs ..............................             --            6,242               --            6,242
    Cumulative net gain ..............................       (609,625)         (10,239)        (165,546)              --
                                                         ------------     ------------     ------------     ------------
Net periodic pension (benefit) cost ..................   $ (1,613,924)    $     36,494     $ (1,008,400)    $     47,361
                                                         ============     ============     ============     ============
</TABLE>


         The Company sponsors two defined contribution plans (the "401(k)
Plans") intended to provide assistance in accumulating personal savings for
retirement. The 401(k) Plans are qualified as a tax-exempt plan under Sections
401(a) and 401(k) of the Internal Revenue Code. The Alside 401(k) Plan covers
all full-time, non-union employees of Alside and matches up to 4.0% of eligible
compensation. For the years ended December 31, 2000 and 1999, the Company's
pre-tax contribution to the Alside 401(k) Plan was $2,041,000 and $2,100,000,
respectively. The AmerCable 401(k) Plan covers all

                                       32
<PAGE>   34

                        ASSOCIATED MATERIALS INCORPORATED
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


full-time employees of AmerCable and matches up to 3.5% of eligible
compensation. For the years ended December 31, 2000, 1999 and 1998, the
Company's pre-tax contributions to the AmerCable 401(k) Plan were $238,000,
$215,000 and $201,000, respectively.


17.      CONTINGENCIES

         The Company entered into a consent order dated August 25, 1992 with the
United States Environmental Protection Agency pertaining to corrective action
requirements associated with the use of hazardous waste storage facilities at
its Akron, Ohio location. With the exception of a small container storage area,
the use of these facilities was terminated prior to the acquisition of the
facilities by the Company from USX Corporation (USX) in 1984. The Company
believes that USX bears financial responsibility for substantially all of the
direct costs of corrective action at these facilities under relevant contract
terms and under statutory and common law. The effects of the past practices of
these facilities are continuing to be investigated pursuant to the terms of the
consent order and as a result the Company is unable to reasonably estimate a
reliable range of the aggregate cost of corrective action at this time. To date,
USX has reimbursed the Company for substantially all of the direct costs of
corrective action at these facilities. The Company expects that USX will
continue to reimburse the Company for substantially all of the direct costs of
corrective action at these facilities. As a result, the Company believes that
any material claims resulting from this proceeding will not have a material
adverse effect on the Company.


ITEM 9.        CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
               AND FINANCIAL DISCLOSURE

          None.


                                       33
<PAGE>   35



                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

         The information required by this item with respect to the Company's
directors is set forth under the caption "Election of Directors" in the
Company's Proxy Statement for the 2001 Annual Meeting of Stockholders to be held
on May 24, 2001 ("Proxy Statement"), to be filed with the Commission pursuant to
Regulation 14A, which is incorporated herein by reference.

         The information required by this item regarding executive officers is
set forth in Item 1 of Part 1 of this report, and incorporated herein by
reference.

         Information required by this item regarding compliance with Section 16
of the Securities Exchange Act of 1934, as amended, by persons subject to this
section is set forth under the caption "Section 16(a) Beneficial Ownership
Reporting Compliance," in the Proxy Statement to be filed pursuant to Regulation
14A, which information is incorporated herein by reference.


ITEM 11. EXECUTIVE COMPENSATION

         The information required by this item is set forth under the captions
"Board of Directors and Committees of the Board - Director Compensation,"
"Executive Officer Compensation," "Option/SAR Grants in 2000," and "Aggregated
Option/SAR Exercises in 2000 and December 31, 2000 Option/SAR Values" in the
Proxy Statement, to be filed with the Commission pursuant to Regulation 14A,
which is incorporated herein by reference.


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The information required by this item is set forth under the caption
"Beneficial Ownership of Common Stock" in the Proxy Statement, to be filed with
the Commission pursuant to Regulation 14A, which is incorporated herein by
reference.


ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The information required by this item is set forth under the caption
"Certain Relationships and Related Transactions" in the Proxy Statement, to be
filed with the Commission pursuant to Registration 14A, which is incorporated
herein by reference.


                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

         The following documents are included in this report.

(a)(1)   FINANCIAL STATEMENTS

         See Index to Financial Statements at Item 8 on page 17 of this report.

(a)(2)   FINANCIAL STATEMENT SCHEDULES

         All financial statement schedules have been omitted due to the absence
of conditions under which they are required or because the information required
is included in the financial statements or the notes thereto.

(b)      REPORTS ON FORM 8-K

         During the quarter ended December 31, 2000, the Company filed no
Current Reports on Form 8-K.


                                       34
<PAGE>   36

(c)      EXHIBITS

      3.1   --    Restated Certificate of Incorporation, as amended, of
                  Associated Materials Incorporated (the "Company")
                  (incorporated by reference to Exhibit 3.1 to the Company's
                  Registration Statement on Form S-1, Commission File No.
                  33-84110 (the "1994 Registration Statement")).

      3.2   --    Restated Bylaws of the Company (incorporated by reference to
                  Exhibit 3.2 of the 1994 Registration Statement).

      4.1   --    Form of Indenture between the Company and U.S. Trust Company
                  of Texas, N.A., as Trustee (the "9 1/4% Note Indenture")
                  (incorporated by reference to Exhibit 4.1 to the Company's
                  Registration Statement on Form S-1, Commission File No.
                  33-42067 (the "1997 Debt Registration Statement")).

      4.2   --    Form of Senior Subordinated Note under the 9 1/4% Note
                  Indenture (incorporated by reference to Exhibit A to Exhibit
                  4.1 to the 1997 Debt Registration Statement).

      4.3   --    Registration Rights Agreement, dated as of August 19, 1993,
                  among the Company, PruSupply Capital Assets, Inc.
                  ("PruSupply"), W.W. Winspear, M.M. Winspear, D.J. Allan, M.G.
                  Winspear, D.W. Winspear, R.L. Winspear, B.W. Meyer, The
                  Principal/The Eppler, Guerin & Turner, Inc., Frank T.
                  Lauinger, John Wallace and Bonnie B. Smith (incorporated by
                  reference to Exhibit 4.3 to the Company's Annual Report on
                  Form 10-K for the fiscal year ended December 31, 1993 (the
                  "1993 Form 10-K")).

      4.4  --     Stockholders' Agreement, dated as of August 19, 1993, among
                  the Company, PruSupply, W.W. Winspear and M.M. Winspear
                  (incorporated by reference to Exhibit 4.4 to the 1993 Form
                  10-K).

      4.5   --    Amendment to the Stockholders' Agreement, dated as of April 1,
                  1994, among the Company, PruSupply, W.W. Winspear and M.M.
                  Winspear (incorporated by reference to Exhibit 4.5 to the 1994
                  Registration Statement).

      4.6   --    Second Amendment to the Stockholders' Agreement, dated as of
                  July 1, 1994, among the Company, PruSupply, W.W. Winspear and
                  M.M. Winspear (incorporated by reference to Exhibit 4.6 to the
                  1994 Registration Statement).

      4.7   --    Third Amendment to the Stockholders' Agreement, dated as of
                  October 12, 1994, among the Company, Prudential and the
                  Winspear Family Limited Partnership (incorporated by reference
                  to Exhibit 4.15 to the 1994 Registration Statement).

      4.8   --    Assumption Agreement, effective as of July 29, 1994, by the
                  Winspear Family Limited Partnership (incorporated by reference
                  to Exhibit 4.7 to the 1994 Registration Statement).

      4.9   --    Assumption Agreement, effective as of September 30, 1994 by
                  The Prudential Insurance Company of America ("Prudential")
                  (incorporated by reference to Exhibit 4.14 to the 1994
                  Registration Statement).

      4.10   --   Assumption Agreement, effective as of February 16, 2000 by PCG
                  Finance Company II, LLC (incorporated by reference to Exhibit
                  4.1 to the March 30, 2000 Form 10-Q).

     10.1    --   Agreement of Sale, dated as of January 30, 1984, between USX
                  Corporation (formerly United States Steel Corporation) ("USX")
                  and the Company (incorporated by reference to Exhibit 10.1 to
                  the 1993 Registration Statement).

     10.2    --   Amendment Agreement, dated as of February 29, 1984, between
                  USX and the Company (incorporated by reference to Exhibit 10.2
                  to the 1993 Registration Statement).

     10.3   --    Form of Indemnification Agreement between the Company and each
                  of the Directors and executive officers of the Company
                  (incorporated by reference to Exhibit 10.14 to the 1994
                  Registration Statement).

     10.4*  --    Associated Materials Incorporated Amended and Restated 1994
                  Stock Incentive Plan (incorporated by reference to Exhibit
                  10.1 to the Company's Quarterly Report on Form 10-Q for the
                  period ended June 30, 1997).


                                       35
<PAGE>   37
     10.5   --    Second Amended and Restated Loan and Security Agreement, dated
                  as of April 2, 1996, between the Company and KeyBank (the
                  "Credit Agreement") (incorporated by reference to Exhibit 10.1
                  to the March 31, 1996 Form 10-Q).

     10.6   --    Third Amendment to Second Amended and Restated Loan and
                  Security Agreement and Waiver, dated May 21, 1999 between the
                  Company and KeyBank relating to the Credit Agreement
                  (incorporated by reference to Exhibit 10.1 to the June 30,
                  1999 Form 10-Q).

     10.7   --    Third Amended and Restated Note, dated April 2, 1996, from the
                  Company to KeyBank relating to the Credit Agreement
                  (incorporated by reference to Exhibit 10.1 to the March 31,
                  1996 Form 10-Q).

     10.8*  --    Associated Materials Incorporated Employee Stock Purchase Plan
                  (incorporated by reference to Exhibit 10.1 to the Company's
                  Quarterly Report on Form 10-Q for the period ended September
                  30, 1998).

     10.9*  --    Employment Agreement, dated December 19, 1999, between Michael
                  Caporale, Jr. and Company (incorporated by reference to
                  Exhibit 10.1 to the March 30, 2000 Form 10-Q).

     10.10* --    Associated Materials Incorporated Incentive Bonus Plan.

     21.1   --    List of Subsidiaries of the Company (incorporated by reference
                  to Exhibit 21.1 to the December 31, 1998 Form 10-K).

     23.1   --    Consent of Independent Auditors.

     24.1   --    Power of Attorney of directors and certain executive officers
                  of the Company.

---------
*Constitutes a compensatory plan or arrangement.


                                       36
<PAGE>   38

                                   SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) 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, in the City of Dallas,
State of Texas on March 20, 2001.

                                     ASSOCIATED MATERIALS INCORPORATED

                                     By: /s/ ROBERT L. WINSPEAR
                                         ---------------------------------------
                                         Robert L. Winspear
                                         Chief Financial Officer,
                                         Vice President, Secretary and Treasurer

      Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed by the following persons in the capacities and on the
date indicated:

<TABLE>
<CAPTION>
        Signature                              Title
        ---------                              -----
<S>                           <C>
   WILLIAM W. WINSPEAR*            Chairman of the Board, President and
--------------------------                Chief Executive Officer
   William W. Winspear                 (Principal Executive Officer)


  /s/ ROBERT L. WINSPEAR         Chief Financial Officer, Vice President,
--------------------------                Secretary and Treasurer
   Robert L. Winspear          (Principal Financial and Accounting Officer)

   MICHAEL CAPORALE, Jr.*                        Director
--------------------------
  Michael Caporale, Jr.

    RICHARD I. GALLAND*                          Director
--------------------------
   Richard I. Galland

       JOHN T. GRAY*                             Director
--------------------------
      John T. Gray

      JAMES F. LEARY*                            Director
--------------------------
     James F. Leary

      ALAN B. LERNER*                            Director
--------------------------
     Alan B. Lerner

      A. A. MEITZ*                               Director
--------------------------
       A.A. Meitz
</TABLE>

      Robert L. Winspear, by signing his name hereto, signs and executes this
document on behalf of each of the above-named officers and directors of
Associated Materials Incorporated on the 20 day of March, 2001, pursuant to a
power of attorney executed on behalf of each of these officers and directors,
and contemporaneously filed hereunto with the Securities and Exchange
Commission.

* By: /s/ ROBERT L. WINSPEAR
      ----------------------
          Robert L. Winspear
          Attorney-in-Fact


                                       37
<PAGE>   39


                                INDEX TO EXHIBITS

<TABLE>
<CAPTION>
    EXHIBIT
    NUMBER                        DESCRIPTION
    -------                       -----------
<S>               <C>
      3.1   --    Restated Certificate of Incorporation, as amended, of
                  Associated Materials Incorporated (the "Company")
                  (incorporated by reference to Exhibit 3.1 to the Company's
                  Registration Statement on Form S-1, Commission File No.
                  33-84110 (the "1994 Registration Statement")).

      3.2   --    Restated Bylaws of the Company (incorporated by reference to
                  Exhibit 3.2 of the 1994 Registration Statement).

      4.1   --    Form of Indenture between the Company and U.S. Trust Company
                  of Texas, N.A., as Trustee (the "9 1/4% Note Indenture")
                  (incorporated by reference to Exhibit 4.1 to the Company's
                  Registration Statement on Form S-1, Commission File No.
                  33-42067 (the "1997 Debt Registration Statement")).

      4.2   --    Form of Senior Subordinated Note under the 9 1/4% Note
                  Indenture (incorporated by reference to Exhibit A to Exhibit
                  4.1 to the 1997 Debt Registration Statement).

      4.3   --    Registration Rights Agreement, dated as of August 19, 1993,
                  among the Company, PruSupply Capital Assets, Inc.
                  ("PruSupply"), W.W. Winspear, M.M. Winspear, D.J. Allan, M.G.
                  Winspear, D.W. Winspear, R.L. Winspear, B.W. Meyer, The
                  Principal/The Eppler, Guerin & Turner, Inc., Frank T.
                  Lauinger, John Wallace and Bonnie B. Smith (incorporated by
                  reference to Exhibit 4.3 to the Company's Annual Report on
                  Form 10-K for the fiscal year ended December 31, 1993 (the
                  "1993 Form 10-K")).

      4.4  --     Stockholders' Agreement, dated as of August 19, 1993, among
                  the Company, PruSupply, W.W. Winspear and M.M. Winspear
                  (incorporated by reference to Exhibit 4.4 to the 1993 Form
                  10-K).

      4.5   --    Amendment to the Stockholders' Agreement, dated as of April 1,
                  1994, among the Company, PruSupply, W.W. Winspear and M.M.
                  Winspear (incorporated by reference to Exhibit 4.5 to the 1994
                  Registration Statement).

      4.6   --    Second Amendment to the Stockholders' Agreement, dated as of
                  July 1, 1994, among the Company, PruSupply, W.W. Winspear and
                  M.M. Winspear (incorporated by reference to Exhibit 4.6 to the
                  1994 Registration Statement).

      4.7   --    Third Amendment to the Stockholders' Agreement, dated as of
                  October 12, 1994, among the Company, Prudential and the
                  Winspear Family Limited Partnership (incorporated by reference
                  to Exhibit 4.15 to the 1994 Registration Statement).

      4.8   --    Assumption Agreement, effective as of July 29, 1994, by the
                  Winspear Family Limited Partnership (incorporated by reference
                  to Exhibit 4.7 to the 1994 Registration Statement).

      4.9   --    Assumption Agreement, effective as of September 30, 1994 by
                  The Prudential Insurance Company of America ("Prudential")
                  (incorporated by reference to Exhibit 4.14 to the 1994
                  Registration Statement).

      4.10   --   Assumption Agreement, effective as of February 16, 2000 by PCG
                  Finance Company II, LLC (incorporated by reference to Exhibit
                  4.1 to the March 30, 2000 Form 10-Q).

     10.1    --   Agreement of Sale, dated as of January 30, 1984, between USX
                  Corporation (formerly United States Steel Corporation) ("USX")
                  and the Company (incorporated by reference to Exhibit 10.1 to
                  the 1993 Registration Statement).

     10.2    --   Amendment Agreement, dated as of February 29, 1984, between
                  USX and the Company (incorporated by reference to Exhibit 10.2
                  to the 1993 Registration Statement).

     10.3   --    Form of Indemnification Agreement between the Company and each
                  of the Directors and executive officers of the Company
                  (incorporated by reference to Exhibit 10.14 to the 1994
                  Registration Statement).

     10.4*  --    Associated Materials Incorporated Amended and Restated 1994
                  Stock Incentive Plan (incorporated by reference to Exhibit
                  10.1 to the Company's Quarterly Report on Form 10-Q for the
                  period ended June 30, 1997).
</TABLE>


<PAGE>   40

<TABLE>
<S>               <C>
     10.5   --    Second Amended and Restated Loan and Security Agreement, dated
                  as of April 2, 1996, between the Company and KeyBank (the
                  "Credit Agreement") (incorporated by reference to Exhibit 10.1
                  to the March 31, 1996 Form 10-Q).

     10.6   --    Third Amendment to Second Amended and Restated Loan and
                  Security Agreement and Waiver, dated May 21, 1999 between the
                  Company and KeyBank relating to the Credit Agreement
                  (incorporated by reference to Exhibit 10.1 to the June 30,
                  1999 Form 10-Q).

     10.7   --    Third Amended and Restated Note, dated April 2, 1996, from the
                  Company to KeyBank relating to the Credit Agreement
                  (incorporated by reference to Exhibit 10.1 to the March 31,
                  1996 Form 10-Q).

     10.8*  --    Associated Materials Incorporated Employee Stock Purchase Plan
                  (incorporated by reference to Exhibit 10.1 to the Company's
                  Quarterly Report on Form 10-Q for the period ended September
                  30, 1998).

     10.9*  --    Employment Agreement, dated December 19, 1999, between Michael
                  Caporale, Jr. and Company (incorporated by reference to
                  Exhibit 10.1 to the March 30, 2000 Form 10-Q).

     10.10* --    Associated Materials Incorporated Incentive Bonus Plan.

     21.1   --    List of Subsidiaries of the Company (incorporated by reference
                  to Exhibit 21.1 to the December 31, 1998 Form 10-K).

     23.1   --    Consent of Independent Auditors.

     24.1   --    Power of Attorney of directors and certain executive officers
                  of the Company.
</TABLE>

---------
*Constitutes a compensatory plan or arrangement.