ITEM 1. BUSINESS
Brush Engineered Materials Inc., through its wholly owned subsidiaries, is a leading manufacturer of high-performance engineered materials serving the global telecommunications and computer, optical media, automotive electronics, industrial components, aerospace and defense and appliance markets. As of December 31, 2003 the Company had 1,833 employees.
The Company's subsidiaries are organized under two reportable segments: the Metal Systems Group and the Microelectronics Group. The Metal Systems Group includes Brush Wellman Inc. (Alloy Products and Beryllium Products) and Technical Materials, Inc. (TMI). The Microelectronics Group includes Williams Advanced Materials Inc. (WAM) and Electronic Products, which in turn, consists of Zentrix Technologies Inc. (Zentrix) and Brush Ceramic Products Inc. (a wholly owned subsidiary of Brush Wellman Inc.). Portions of Brush International, Inc. are included in both segments. Included in "All Other" in the Company's financial statements included later in this Form 10-K are the operating results from BEM Services, Inc. and Brush Resources Inc., two wholly owned subsidiaries of the Company. BEM Services charges a management fee for services, such as administrative and financial oversight, to the other businesses within the Company on a cost-plus basis. Brush Resources sells beryllium hydroxide produced through its Utah operations to outside customers and to businesses within the Metal Systems Group. As of December 31, 2003 BEM Services, Inc. and Brush Resources Inc. had 156 employees.
METAL SYSTEMS GROUP
The Metal Systems Group is comprised of Alloy Products (primarily copper beryllium), Beryllium Products and TMI. In 2003, 60% of the Company's sales were from this segment (61% in 2002 and 63% in 2001). As of December 31, 2003 the Metal Systems Group had 1,125 employees.
Alloy Products, the largest unit within the Company and this segment, manufactures and sells copper and nickel-based alloy systems, the majority of which also contains beryllium. These products are metallurgically tailored to meet specific customer performance requirements. Copper beryllium alloys exhibit high electrical and thermal conductivities, high strength and hardness, good formability and excellent resistance to corrosion,
wear and fatigue. These alloys, sold in strip and bulk form, are ideal choices for demanding applications in the telecommunications and computer, automotive electronics, aerospace, oil exploration, undersea housing for telecommunications equipment, bushings, bearings, appliances and plastic mold tooling markets. Alloy Products also manufactures non-beryllium-containing alloys including Toughmet(R), a copper-nickel tin alloy. These alloys are corrosion and wear resistant and have excellent lubricity properties and are used in plastic tooling and heavy equipment product applications. Alloy products are sold domestically through Brush distribution centers and internationally through Company-owned and independent distribution centers and independent sales representatives.
Beryllium Products manufactures products that include beryllium, AlBeMet(R) and E-materials, serving the aerospace, defense, medical and industrial x-ray equipment, optical scanning and high performance automation markets. Beryllium is a lightweight metal possessing unique mechanical and thermal properties. Its specific stiffness is much greater than other engineered structural materials such as aluminum, titanium and steel. Beryllium is extracted from both bertrandite and imported beryl ore. In 2001, the Company purchased land and mineral rights that were previously leased by its mining operations in Utah. Beryllium-containing products are sold throughout the world through a direct sales organization and through Company-owned and independent distribution centers.
NGK Insulators, Ltd. of Nagoya, Japan, with subsidiaries in the U.S. and Europe, competes with beryllium alloy strip products and beryllium products. Alloy Strip Products also competes with alloy systems manufactured by Olin Corporation, Wieland Electric, Inc. and Stolberger Metallwerke GmbH, Nippon Mining, PMX and also with other generally less expensive materials, including phosphor bronze, stainless steel and other specialty copper and nickel alloys which are produced by a variety of companies around the world. While Beryllium Products is the only domestic producer of metallic beryllium, it competes with other fabricators as well as with designs utilizing other materials. In the area of beryllium alloy Bulk products (bar, plate, tube and rod), in addition to NGK Insulators, Brush competes with several smaller regional producers such as Freedom Alloys in the U.S., LaBronze Industriel in Europe, and Young II in Asia.
TMI manufactures engineered material systems which are combinations of precious and non-precious metals in continuous strip form, and are used in complex electronic and electrical components in telecommunications systems, automotive electronics, semi-conductors and computers. TMI's products are sold directly and through its sales representatives. TMI has limited competition in the United States and several European manufacturers are competitors for the sale of inlaid strip. Strip with selective electroplating is a competitive alternative as are other design approaches.
METAL SYSTEMS GROUP -- SALES AND BACKLOG
The backlog of unshipped orders as of December 31, 2003, 2002 and 2001 was $47,692,000, $35,064,000 and $60,945,000 respectively. Backlog is generally represented by purchase orders that may be terminated under certain conditions. The Company expects that substantially all of its backlog of orders for this segment at December 31, 2003 will be filled during 2004.
Sales are made to approximately 1,700 customers. Government sales, principally subcontracts, accounted for about 7.9% of Metal Systems Group sales in 2003 as compared to 9.3% in 2002 and 3.3% in 2001. Sales outside the United States, principally to Western Europe, Canada and the Pacific Rim, accounted for approximately 42% of the Metal Systems Group sales in 2003, 35% in 2002 and 38% in 2001. Other segment reporting and geographic information set forth on page 49 in Note M to the consolidated financial statements in the annual report to shareholders for the year ended December 31, 2003 is incorporated herein by reference.
METAL SYSTEMS GROUP -- RESEARCH AND DEVELOPMENT
Active research and development programs seek new product compositions and designs as well as process innovations. Expenditures for research and development amounted to $2,820,000 in 2003, $2,522,000 in 2002 and $4,679,000 in 2001. A staff of 21 scientists, engineers and technicians was employed in this effort as of year end 2003. Some research and development projects, expenditures for which are not material, were externally sponsored.
MICROELECTRONICS GROUP
The Microelectronics Group is comprised of WAM and Electronic Products, which consists of Zentrix and Brush Ceramic Products Inc. In 2003, 39% of the Company's sales were from this segment (37% in 2002 and 36% in 2001). As of December 31, 2003 the Microelectronics Group had 552 employees.
WAM manufactures and fabricates precious metal and specialty metal products for the optical media, magnetic head, including magnetic resistive (MR) and giant magnetic resistive (GMR) materials, electron tube, performance film and the wireless, semiconductor, photonic and hybrid segments of the microelectronics market. WAM's major product lines include vapor deposition materials, clad and precious metals preforms, high temperature braze materials, ultra fine wire, sealing lids for the semiconductor/hybrid markets and restorative dental alloys.
WAM's products are sold directly from WAM's facilities in Buffalo, New York; Brewster, New York; Wheatfield, New York; Singapore, Taiwan and the Philippines, as well as through direct sales offices and independent sales representatives throughout the world. Principal competition includes companies such as Sumitomo Metals, Praxair, Inc., Honeywell International Inc. and a number of smaller regional and national suppliers.
Zentrix produces electronic packaging and circuit products. Production sites include Oceanside, California and Newburyport, Massachusetts. These products are used in wireless telecommunication, fiberoptics, automotive and defense applications. Zentrix's products are sold directly and through its sales representatives. Zentrix competes with other electronic packaging and circuit component suppliers such as Kyocera Corporation, Aeroflex, Inc. and Anaren Microwave.
Brush Ceramic Products Inc., located in Tucson, Arizona, produces beryllia ceramics used in wireless telecommunications, lasers, automotive and defense product applications. Principal competitors include CBL Ceramics Ltd. and American Beryllia, Inc. Competitive materials include aluminum nitride and metal matrix composites.
MICROELECTRONICS GROUP -- SALES AND BACKLOG
The backlog of unshipped orders as of December 31, 2003, 2002 and 2001 was $13,681,000, $19,833,000 and $20,458,000, respectively. Backlog is generally represented by purchase orders that may be terminated under certain conditions. The Company expects that substantially all of its backlog of orders for this segment at December 31, 2003 will be filled during 2004.
Sales are made to approximately 1,700 customers. Government sales, principally subcontracts, accounted for less than 1% of Microelectronics Group sales in 2003 as compared to less than 1% in 2002 and 2.8% in 2001. Sales outside the United States, principally to Western Europe, Canada and the Pacific Rim, accounted for approximately 15% of Microelectronics Group sales in 2003, 18% in 2002 and 13% in 2001. Other segment reporting and geographic information set forth on page 49 in Note M to the consolidated financial statements in the annual report to shareholders for the year ended December 31, 2003 is incorporated herein by reference.
MICROELECTRONICS GROUP -- RESEARCH AND DEVELOPMENT
Active research and development programs seek new product compositions and designs as well as process innovations. Expenditures for research and development amounted to $1,409,000 for 2003, $1,743,000 for 2002 and $1,648,000 in 2001. A staff of 6 scientists, engineers and technicians was employed in this effort as of year end 2003.
GENERAL
AVAILABILITY OF RAW MATERIALS
The principal raw materials used by the Company are beryllium (extracted from both imported beryl ore and bertrandite mined from the Company's Utah properties), copper, gold, silver, nickel, platinum, palladium and aluminum. Ore reserve data in Management's Discussion and Analysis on pages 24 and 25 of the
Company's annual report to shareholders for the year ended December 31, 2003 is incorporated herein by reference. The Company has agreements to purchase stated quantities of beryl ore, beryllium metal and beryllium-copper master alloy from the Defense Logistics Agency of the U.S. Government. In addition, the Company has a long-term supply arrangement with Ulba/Kazatomprom of the Republic of Kazakhstan and its marketing representative, Nukem, Inc. of New York, to purchase quantities of beryllium-copper master and beryllium vacuum cast billet. The availability of these raw materials, as well as other materials used by the Company, is adequate and generally not dependent on any one supplier.
PATENTS AND LICENSES
The Company owns patents, patent applications and licenses relating to certain of its products and processes. While the Company's rights under the patents and licenses are of some importance to its operations, the Company's business is not materially dependent on any one patent or license or on all of its patents and licenses as a group.
REGULATORY MATTERS
The Company is subject to a variety of laws which regulate the manufacture, processing, use, handling, storage, transport, treatment, emission, release and disposal of substances and wastes used or generated in manufacturing. For decades the Company has operated its facilities under applicable standards of inplant and outplant emissions and releases. The inhalation of airborne beryllium particulate may present a health hazard to certain individuals. The Occupational Safety and Health Administration ("OSHA") is currently reviewing its beryllium standards.
EXECUTIVE OFFICERS OF THE REGISTRANT
The following table shows the name, age and position of each of our executive officers as of December 31, 2003:
ITEM 2.
ITEM 2. PROPERTIES
The material properties of the Company, all of which are owned in fee except as otherwise indicated, are as follows:
MANUFACTURING FACILITIES
BREWSTER, NEW YORK -- A 35,000 square foot leased facility on a 6.0 acre site for manufacturing services relating to non-precious metals.
BUFFALO, NEW YORK -- A complex of approximately 97,000 square feet on a 3.8 acre site providing facilities for manufacturing, refining and laboratory services relating to high purity precious metals.
DELTA, UTAH -- An ore extraction plant consisting of 86,000 square feet of buildings and large outdoor facilities situated on a 4,400 acre site. This plant extracts beryllium from bertrandite ore from the Company's mines as well as from imported beryl ore.
ELMORE, OHIO -- A complex containing approximately 856,000 square feet of building space on a 439 acre plant site. This facility employs diverse chemical, metallurgical and metalworking processes in the production of beryllium, beryllium oxide, beryllium alloys and related products.
FREMONT, CALIFORNIA -- A 16,800 square foot leased facility for the fabrication of precision electron beam welded, brazed and diffusion bonded beryllium structures.
JUAB COUNTY, UTAH -- 7,500 acres with respective mineral rights from which the beryllium-bearing ore, bertrandite, is mined by the open pit method. A portion of the mineral rights is held under lease. Ore reserve data set forth on pages 24 and 25 in the annual report to shareholders for the year ended December 31, 2003 is incorporated herein by reference.
LINCOLN, RHODE ISLAND -- A manufacturing facility consisting of 140,000 square feet located on 7.5 acres. This facility produces reel-to-reel strip metal products which combine precious and non-precious metals in continuous strip form and related metal systems products.
LORAIN, OHIO -- A manufacturing facility consisting of 55,000 square feet located on 15 acres. This facility produces non-beryllium metal alloys in electronic induction furnaces which are continually cast into bar stock and heat treated.
NEWBURYPORT, MASSACHUSETTS -- A 30,000 square foot manufacturing facility on a 4 acre site that produces alumina, beryllia ceramic and direct bond copper products.
OCEANSIDE, CALIFORNIA -- Two leased facilities totaling 20,200 square feet on 1.25 acres of leased land. Over three-quarters of these facilities are comprised of clean rooms for the production of thick-film circuits and other complex circuits.
SANTA CLARA, CALIFORNIA -- A 5,800 square foot leased facility that provides bonding services relating to physical vapor deposition (PVD) materials.
SHOEMAKERSVILLE (READING), PENNSYLVANIA -- A 123,000 square foot plant on a 55 acre site that produces thin precision strips of copper beryllium and other alloys and copper beryllium rod and wire.
SINGAPORE -- A 4,500 square foot leased facility for the assembly and sale of precious metal hermetic sealing lids.
SUBIC BAY, PHILIPPINES -- A 5,000 square foot leased facility that manufactures Combo-Lid(R) and performs preform assembly, inspection and packaging.
TAIPEI, TAIWAN -- A 5,000 square foot leased service/bonding center supporting the PVD product market in Asia.
TUCSON, ARIZONA -- A complex containing approximately 63,000 square feet of building space on a 10 acre site for the production of beryllium oxide ceramic substrates.
WHEATFIELD, NEW YORK -- A 29,000 square foot facility on a 10.2 acre site for manufacturing services relating to braze material and specialty alloys.
RESEARCH FACILITIES AND ADMINISTRATIVE OFFICES
CLEVELAND, OHIO -- A 110,000 square foot building on an 18 acre site housing corporate and administrative offices, data processing and research and development facilities.
SERVICE AND DISTRIBUTION CENTERS
ELMHURST, ILLINOIS -- A 28,500 square foot leased facility principally for distribution of copper beryllium alloys.
FAIRFIELD, NEW JERSEY -- A 24,500 square foot leased facility principally for distribution of copper beryllium alloys.
FUKAYA, JAPAN -- A 35,500 square foot facility on 1.8 acres of land in Saitama Prefecture principally for distribution of copper beryllium alloys.
SINGAPORE -- A 2,500 square foot leased sales office that houses employees of Alloy Products and WAM Far East.
STUTTGART, GERMANY -- A 24,750 square foot leased facility principally for distribution of copper beryllium alloys.
THEALE, ENGLAND -- A 19,700 square foot leased facility principally for distribution of copper beryllium alloys.
WARREN, MICHIGAN -- A 34,500 square foot leased facility principally for distribution of copper beryllium alloys.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS
The Company and its subsidiaries are subject, from time to time, to a variety of civil and administrative proceedings arising out of their normal operations, including, without limitation, product liability claims, health, safety and environmental claims and employment-related actions. Among such proceedings are the cases described below.
BERYLLIUM CLAIMS
There are claims pending in various state and federal courts against Brush Wellman, one of the Company's subsidiaries, by some of its employees or former employees and by third party individuals (typically employees of customers or of independent contractors) alleging that they contracted, or have been placed at risk of contracting, chronic beryllium disease or other lung conditions as a result of exposure to beryllium. Plaintiffs in beryllium cases seek recovery under theories of intentional tort and various other legal theories and seek compensatory and punitive damages, in many cases of an unspecified sum. Spouses, if any, claim loss of consortium.
During 2003, the number of beryllium cases decreased from 33 (involving 70 plaintiffs), as of December 31, 2002 to 15 cases (involving 33) plaintiffs as of December 31, 2003. During 2003, an aggregate of 24 cases involving 47 plaintiffs were settled. Five cases involving 12 plaintiffs were voluntarily dismissed by the plaintiffs. Eleven cases involving 22 plaintiffs were filed in 2003.
The 15 pending beryllium cases fall into three categories: one "employee case" involving one former employee; 12 cases involving third-party individual plaintiffs, with 12 individuals (and five spouses who have
filed claims as part of their spouse's case, and five children who have filed claims as part of their parent's case); and two purported class actions, involving 10 individuals, as discussed more fully below. Employee cases, in which plaintiffs have a high burden of proof, have historically involved relatively small losses to the Company. Third-party plaintiffs (typically employees of our customers or contractors) face a lower burden of proof than do employees or former employees, but these cases are generally covered by varying levels of insurance.
In one purported class action in which Brush Wellman is seeking review of the appellate court's reversal of the trial court's denial of class certification, the named plaintiffs allege that past exposure to beryllium has increased their risk of contracting chronic beryllium disease and possibly cancer, although they do not claim to have actually contracted any disease. They seek medical monitoring funds to be used to detect medical problems that they believe may develop as a result of their exposure, and seek punitive damages. This purported class action was brought by named plaintiffs on behalf of tradesmen who worked in one of Brush Wellman's facilities as employees of independent contractors.
In the second purported class action that is pending against Brush Wellman, the named plaintiffs allege that they were exposed to beryllium in the course of their employment with a customer of Brush Wellman, and that they are sensitized to beryllium. They seek medical monitoring funds to be used to detect medical problems that they believe may develop as a result of their exposure, and seek punitive damages. This purported class action was brought by named plaintiffs on behalf of employees who worked in the state of California at the facilities of one of Brush Wellman's customers, and the spouses of those workers.
From January 1, 2004 to March 8, 2004, Brush Wellman was served with a third purported class action, in which the named plaintiffs allege that they were exposed to beryllium in the course of their employment with a customer of Brush Wellman. They seek medical monitoring funds to be used to detect medical problems that they believe may develop as a result of their exposure, and seek punitive damages. This purported class action was brought on behalf of current and former employees who worked at the Marietta, Georgia facility of one of Brush Wellman's customers, and their spouses. One third-party case (involving one plaintiff) was filed. Two third-party cases (involving seven plaintiffs) were voluntarily dismissed by the plaintiffs. The settlement amounts in five third-party cases (involving 14 plaintiffs) that were settled and dismissed in 2003 have been paid to the plaintiffs. One employee case (involving one plaintiff) was settled and dismissed.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
PART II
ITEM 5.
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS
The Company's Common Stock is traded on the New York Stock Exchange. As of March 5, 2003 there were 1,738 shareholders of record. Information as to stock price and dividends declared set forth on page 51 in Note P to the consolidated financial statements in the annual report to shareholders for the year ended December 31, 2003 is incorporated herein by reference. The Company's ability to pay dividends is restricted as provided in its subordinated term loan agreement dated December 4, 2003.
In connection with the debt refinancing completed on December 4, 2003, the Company issued warrants to purchase 115,000 shares of the Company's common stock to its subordinated lenders as part of the consideration for a $35 million subordinated loan, in reliance upon applicable exemptions from registration under federal and state securities laws.
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA
Selected Financial Data on pages 52 and 53 of the annual report to shareholders for the year ended December 31, 2003 is incorporated herein by reference.
ITEM 7.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The management's discussion and analysis of financial condition and results of operations on pages 14 through 28 of the annual report to shareholders for the year ended December 31, 2003 is incorporated herein by reference.
ITEM 7A.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The market risk disclosures on pages 27 and 28 of the annual report to shareholders for the year ended December 31, 2003 are incorporated herein by reference.
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The report of independent auditors and the following consolidated financial statements of the Company included in the annual report to shareholders for the year ended December 31, 2003 are incorporated herein by reference:
Consolidated Balance Sheets -- December 31, 2003 and 2002.
Consolidated Statements of Income -- Years ended December 31, 2003, 2002 and 2001.
Consolidated Statements of Shareholders' Equity -- Years ended December 31, 2003, 2002 and 2001.
Consolidated Statements of Cash Flows -- Years ended December 31, 2003, 2002 and 2001.
Notes to Consolidated Financial Statements.
Quarterly Data on page 51 in Note P to the consolidated financial statements in the annual report to shareholders for the years ended December 31, 2003 and 2002 is incorporated herein by reference.
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A.
ITEM 9A. CONTROLS AND PROCEDURES
We carried out an evaluation under the supervision and with participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2003 pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended. Based upon that evaluation, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective as of the evaluation date.
There have been no changes in our internal controls over financial reporting that occurred during the year ended December 31, 2003 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART III
ITEM 10.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information under Election of Directors on pages 2 through 4 of the Proxy Statement dated March 15, 2004, as filed with the Securities and Exchange Commission pursuant to Regulation 14A, is incorporated herein by reference. The information required by this item relating to our executive officers is included under the caption "Executive Officers of the Registrant" in Part I of this report and is incorporated by reference into this section. The information required by Item 10 with respect to directors, the Audit Committee of the Board of Directors and Audit Committee financial experts is incorporated herein by reference in the section entitled "Corporate Governance; Committees of the Board of Directors" on pages 5 and 6 of the Proxy Statement dated March 15, 2004.
The Company has adopted a Policy Statement on Significant Corporate Governance Issues and a Code of Business Conduct and Ethics that applies to our chief executive officer, chief operating officer and senior financial officers, including the principal financial and accounting officer, controller and other persons performing similar functions in compliance with applicable New York Stock Exchange and Securities and Exchange Commission requirements. These materials, along with the charters of the Audit, Governance, Organization and Compensation and Retirement Plan Review Committees of the Company's Board of Directors, which also comply with applicable requirements, are available on the Company's website at www.beminc.com, and copies are also available upon request by any shareholder to Michael C. Hasychak, Secretary, Brush Engineered Materials Inc., 17876 St. Clair Avenue, Cleveland, Ohio 44110. The Company makes its reports on Forms 10-K, 10-Q and 8-K available on its website, free of charge, as soon as reasonably practicable after these reports are filed with the Securities and Exchange Commission, and any amendments or waivers to the Company's Code of Business Conduct and Ethics and Policy Statement on Significant Corporate Governance Issues will also be made available on the Company's website. The information on our website is not incorporated by reference into this annual report on Form 10-K.
ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION
The information required under this heading is incorporated by reference from pages 11 and 12 of the Proxy Statement dated March 15, 2004, as filed with the Securities and Exchange Commission pursuant to Regulation 14A.
ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information required under this heading is incorporated by reference from pages 9 and 10 and the "Equity Compensation Plan Information" on page 12 of the Proxy Statement dated March 15, 2004, as filed with the Securities and Exchange Commission pursuant to Regulation 14A.
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Not applicable.
ITEM 14.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.
The information required under this heading is incorporated by reference on page 19 of the Proxy Statement dated March 15, 2004, as filed with the Securities and Exchange Commission pursuant to Regulation 14A.
PART IV
ITEM 15.
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) 1. FINANCIAL STATEMENTS AND SUPPLEMENTAL INFORMATION
Included in Part II of this Form 10-K annual report by reference to the
annual report to shareholders for the year ended December 31, 2003 are the following consolidated financial statements:
Consolidated Balance Sheets -- December 31, 2003 and 2002.
Consolidated Statements of Income -- Years ended December 31, 2003, 2002 and 2001.
Consolidated Statements of Shareholders' Equity -- Years ended December 31, 2003, 2002 and 2001.
Consolidated Statements of Cash Flows -- Years ended December 31, 2003, 2002 and 2001.
Notes to Consolidated Financial Statements.
Report of Independent Auditors.
(a) 2. FINANCIAL STATEMENT SCHEDULES
The following consolidated financial information for the years ended December 31, 2003, 2002 and 2001 is submitted herewith:
Schedule II -- Valuation and qualifying accounts.
All other schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are not required under the related instructions or are inapplicable, and therefore have been omitted.
(a) 3. EXHIBITS
- ---------------
* Reflects management contract or other compensatory arrangement required to be filed as an Exhibit pursuant to Item 15(c) of this Report.
(b) REPORTS ON FORM 8-K
In a report on Form 8-K filed October 23, 2003, Brush Engineered Materials Inc. incorporated in Item 12 its July October 23 press release, reporting on its earnings for the third quarter of 2003.
In a report on Form 8-K filed October 29, 2003, Brush Engineered Materials Inc. announced that the "Current Investor" section of its website had been updated.
In a report on Form 8-K filed December 5, 2003, Brush Engineered Materials Inc. issued a press release announcing it had completed the refinancing of its bank revolving credit and term loan.
In a report on Form 8-K filed December 16, 2003, Brush Engineered Materials Inc. filed the Guggenheim Corporate Funding, LLC credit document.
SIGNATURES
Pursuant to the requirements of Section 13 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.
March 15, 2004
BRUSH ENGINEERED MATERIALS INC.
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
*The undersigned, by signing his name hereto, does sign and execute this report on behalf of each of the above-named officers and directors of Brush Engineered Materials Inc., pursuant to Powers of Attorney executed by each such officer and director filed with the Securities and Exchange Commission.
SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
BRUSH ENGINEERED MATERIALS INC. AND SUBSIDIARIES YEARS ENDED DECEMBER 31, 2003, 2002 AND 2001
Note A -- Bad debts written-off, net of recoveries.
Note B -- Inventory write-off.