-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BhG1GQRlqzyASHTc0Hw6YABmiKwA473/6CdSptsYVMFveOipSCySlqutzMm3wP6h Lb234HbJ9mMMO1KM7jzuvQ== 0000950128-04-000668.txt : 20040625 0000950128-04-000668.hdr.sgml : 20040625 20040625153601 ACCESSION NUMBER: 0000950128-04-000668 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20031231 FILED AS OF DATE: 20040625 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALLEGHENY TECHNOLOGIES INC CENTRAL INDEX KEY: 0001018963 STANDARD INDUSTRIAL CLASSIFICATION: STEEL PIPE & TUBES [3317] IRS NUMBER: 251792394 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-12001 FILM NUMBER: 04882119 BUSINESS ADDRESS: STREET 1: 1000 SIX PPG PLACE CITY: PITTSBURGH STATE: PA ZIP: 15222 BUSINESS PHONE: 4123942800 MAIL ADDRESS: STREET 1: 100 SIX PPG PLACE CITY: PITTSBURGH STATE: PA ZIP: 15222 FORMER COMPANY: FORMER CONFORMED NAME: ALLEGHENY TELEDYNE INC DATE OF NAME CHANGE: 19960716 11-K 1 j0815201e11vk.txt ALLEGHENY LUDLUM RETIREMENT AND 401(K) ACCOUNTS UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] FOR THE FISCAL YEAR ENDED DECEMBER 31, 2003 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] FOR THE TRANSITION PERIOD FROM TO ----------- ------------- COMMISSION FILE NUMBER 1-12001 ALLEGHENY LUDLUM CORPORATION PERSONAL RETIREMENT AND 401(K) SAVINGS ACCOUNT PLAN ------------------------------------------ (Title of Plan) ALLEGHENY TECHNOLOGIES INCORPORATED (Name of Issuer of securities held pursuant to the Plan) 1000 Six PPG Place, Pittsburgh, Pennsylvania 15222-5479 (Address of Plan and principal executive offices of Issuer) AUDITED FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Years ended December 31, 2003 and 2002 with Report of Independent Registered Public Accounting Firm Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Audited Financial Statements and Supplemental Schedule Years ended December 31, 2003 and 2002 CONTENTS Report of Independent Registered Public Accounting Firm ................... 1 Audited Financial Statements Statements of Net Assets Available for Benefits............................ 2 Statements of Changes in Net Assets Available for Benefits................. 3 Notes to Financial Statements ............................................. 4 Supplemental Schedule Schedule H, Line 4i--Schedule of Assets (Held at End of Year).............. 12 Signatures ................................................................ 13 Exhibit 23 Consent of Independent Registered Public Accounting Firm
Report of Independent Registered Public Accounting Firm Allegheny Technologies Incorporated We have audited the accompanying statements of net assets available for benefits of the Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan as of December 31, 2003 and 2002, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (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 net assets available for benefits of the Plan at December 31, 2003 and 2002, and the changes in its net assets available for benefits for the years then ended, in conformity with U.S. generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedule of assets (held at end of year) as of December 31, 2003 is presented for purposes of additional analysis and is not a required part of the financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole. /s/ Ernst & Young LLP June 18, 2004 Pittsburgh, Pennsylvania 1 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Statements of Net Assets Available for Benefits
DECEMBER 31 2003 2002 ----------------------------- Investments: Interest in Allegheny Technologies Incorporated Savings Plan Trust $ 77,595,773 $ 68,562,589 Interest in registered investment companies 23,191,284 10,334,374 Corporate common stocks 10,674,790 3,976,412 Participant loans 5,619,359 6,072,273 Interest in common collective trusts 134,103 8,616,603 ----------------------------- Total investments 117,215,309 97,562,251 Other payables, net (126,616) (679,148) ----------------------------- Net assets available for benefits $ 117,088,693 $ 96,883,103 =============================
See accompanying notes. 2 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Statements of Changes in Net Assets Available for Benefits
YEARS ENDED DECEMBER 31 2003 2002 -------------------------------- Contributions: Employer $ 2,412,075 $ 2,732,088 Employee 5,375,543 5,187,714 -------------------------------- Total contributions 7,787,618 7,919,802 Investment income (loss): Net gain (loss) from interest in Allegheny Technologies Incorporated Savings Plan Trust 6,817,946 (1,152,894) Net gain (loss) from interest in registered investment companies 4,396,256 (2,544,431) Net gain (loss) from interest in common collective trusts 686,146 (1,309,517) Interest income 340,017 393,001 Dividend income 197,275 347,604 Net realized/unrealized gain (loss) on corporate common stocks 6,606,984 (5,668,370) -------------------------------- Total investment gain (loss) 19,044,624 (9,934,607) -------------------------------- 26,832,242 (2,014,805) Distributions to participants (6,632,092) (6,709,034) Plan transfers, net 5,440 (47,906) -------------------------------- (6,626,652) (6,756,940) -------------------------------- Net increase (decrease) in net assets available for benefits 20,205,590 (8,771,745) Net assets available for benefits at beginning of year 96,883,103 105,654,848 -------------------------------- Net assets available for benefits at end of year $ 117,088,693 $ 96,883,103 ================================
See accompanying notes. 3 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Notes to Financial Statements December 31, 2003 1. SIGNIFICANT ACCOUNTING POLICIES Investments are valued as follows: Bank and insurance investment contracts (investment contracts) with varying contract rates and maturity dates are stated at contract value. Although it is management's intention to hold the investment contracts in the Fixed Income Master Trust until maturity, certain investment contracts provide for adjustments to contract value for withdrawals made prior to maturity. All other investments are stated at their net asset value, based on the quoted market prices of the securities held in such funds on applicable exchanges. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. 2. DESCRIPTION OF THE PLAN The Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan (the Plan) is a defined contribution plan and subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). The purpose of the Plan is to provide retirement benefits to eligible employees of Allegheny Ludlum Corporation (ALC or the Company) through company contributions and to encourage employee thrift by permitting eligible employees to defer a part of their compensation and contribute such deferral to the Plan. ALC is a wholly owned subsidiary of Allegheny Technologies Incorporated (ATI, the Plan Sponsor). ALC contributes to the Plan $0.50 per hour worked per eligible union employee. Unless otherwise specified by the participant, all contributions are made to the Fixed Income Master Trust. Such contributions are made only from current income or accumulated earnings of the Plan Sponsor. The Plan allows participants to direct contributions made on their behalf to any of the investment alternatives. The Plan allows employees to contribute a portion of eligible wages each pay period through payroll deductions subject to Internal Revenue Code limitations. In addition, the employees' annual pretax profit sharing award and pretax Longevity Incentive Payment Plan award may be contributed at the employees' discretion as their deferral. 4 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Notes to Financial Statements (continued) 2. DESCRIPTION OF THE PLAN (CONTINUED) Separate accounts are maintained by the Plan Sponsor for each participating employee. Trustee fees and asset management fees charged by the Plan's trustee, Mellon Bank, N.A., for the administration of all funds are charged against net assets available for benefits of the respective fund. Certain other expenses of administering the Plan are paid by the Plan Sponsor. Participants may make "in-service" and hardship withdrawals as outlined in the plan document. Active employees can borrow up to 50% of their vested account balances minus any outstanding loans. The loan amounts are further limited to a minimum of $500 and a maximum of $50,000, and an employee can obtain no more than three loans at one time. Interest rates are determined based on commercially accepted criteria, and payment schedules vary based on the type of the loan. General-purpose loans are repaid over 6 to 60 months, and primary residence loans are repaid over periods up to 180 months. Payments are made by payroll deductions. Further information about the Plan, including eligibility, vesting, contributions, and withdrawals, is contained in the plan document, summary plan description, and related contracts. Copies of these documents are available from the Plan Sponsor. 3. INVESTMENTS The following presents investments that represent 5% or more of the Plan's net assets:
DECEMBER 31 2003 2002 ------------------------------- Fixed Income Master Trust $ 60,271,858 $ 56,605,733 Allegheny Technologies Incorporated common stock 10,674,790 3,976,412* Allegheny Technologies Disciplined Stock Fund Master Trust 9,166,850 6,082,791 Alliance Equity Master Trust 8,157,065 5,874,064 Oakmark Balanced Fund 6,836,824 -* Dreyfus Emerging Leaders Fund 6,695,196 4,632,483* Dreyfus Lifestyle Growth and Income Fund -* 5,243,372
*Shown for comparative purposes. 5 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Notes to Financial Statements (continued) 3. INVESTMENTS (CONTINUED) Certain of the Plan's investments are in the Allegheny Technologies Incorporated Savings Plan Trust, which has three subsidiary Master Trusts: the Allegheny Technologies Disciplined Stock Fund Master Trust, the Alliance Equity Master Trust, and the Fixed Income Master Trust, which are institutional separate accounts valued on a unitized trust basis (collectively, the "Master Trust"). The Master Trust was established for the investment of assets of the Plan, and several other ATI sponsored retirement plans. Each participating retirement plan has an undivided interest in the Master Trust. At December 31, 2003 and 2002, the Plan's interest in the net assets of the Fixed Income Master Trust, the Alliance Equity Master Trust, and the Allegheny Technologies Disciplined Stock Fund Master Trust was as follows:
2003 2002 ----------------- Fixed Income Master Trust 31.46% 31.31% Alliance Equity Master Trust 22.88 22.12 Allegheny Technologies Disciplined Stock Fund Master Trust 11.78 11.07
Investment income and expenses are allocated to the Plan based upon its pro rata share in the net assets of the Master Trust. 6 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Notes to Financial Statements (continued) 3. INVESTMENTS (CONTINUED) The composition of the net assets of the Fixed Income Master Trust at December 31, 2003 and 2002 was as follows:
2003 2002 --------------------------------- Guaranteed investment contracts: Canada Life $ 2,757,412 $ 2,757,412 GE Life and Annuity 9,583,804 10,420,327 Hartford Life Insurance Company 10,939,222 10,460,185 John Hancock Life Insurance Company 8,848,178 9,854,982 Monumental Life Insurance Company 2,353,862 2,363,422 New York Life Insurance Company 6,814,589 7,808,955 Ohio National Life 4,652,712 5,976,900 Pacific Mutual Life Insurance Company 6,075,054 6,074,436 Principal Life 1,187,962 1,134,634 Protective Life Insurance Company 1,006,456 1,006,463 Pruco Pace Credit Enhanced 8,947,069 8,689,223 Safeco Life Insurance - 1,973,290 Security Life of Denver 6,737,205 6,465,137 Sun America, Inc. - 2,988,024 United of Omaha 7,226,335 7,226,335 --------------------------------- 77,129,860 85,199,725 Synthetic guaranteed investment contracts: Caisse des Depots et Consignations 1,999,995 4,953,210 CIT Equipment - 996,925 Common Wealth Edison - 2,999,980 Commit to purchase FNMA 02-74 LC - 3,071,979 Conn RRB Spec Trust - 2,948,436 Detroit Edison - 2,027,941 FHLMC - 5,977,227 Illinois Power Sp Trust - 1,971,078 MBNA Master CC Trust - 1,993,490 MDA Monumental BGI Wrap 33,990,199 41,868,727 Peco Energy Company - 1,970,899 Peoples Security Life Insurance Company - 2,491,608 Public Service - 2,036,624 Bank of America 17,803,044 - Rabobank 36,635,330 - Transamerica Occidental - 6,568,303 Union Bank of Switzerland 14,768,321 174,682 Westdeutsche Landesbank Girozentrale - 3,556,463 --------------------------------- 105,196,889 85,607,572 Interest in common collective trusts 8,515,369 7,972,257 Interest-bearing cash - 212,167 Other 764,537 1,817,668 --------------------------------- Total net assets $ 191,606,655 $ 180,809,389 =================================
7 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Notes to Financial Statements (continued) 3. INVESTMENTS (CONTINUED) The Fixed Income Fund (the Fund) invests in guaranteed investment contracts (GICs) and actively managed structured or synthetic investment contracts (SICs). The GICs are promises by a bank or insurance company to repay principal plus a fixed rate of return through contract maturity. SICs differ from GICs in that there are specific assets supporting the SICs, and these assets are owned by the Master Trust. The bank or insurance company issues a wrapper contract that allows participant-directed transactions to be made at contract value. The assets supporting the SICs are comprised of government agency bonds, corporate bonds, asset-backed securities (ABOs), and collateralized mortgage obligations (CMOs) with fair values of $107,926,162 and $88,750,762 at December 31, 2003 and 2002, respectively. Interest crediting rates on the GICs in the Fund are determined at the time of purchase. Interest crediting rates on the SICs are either: (1) set at the time of purchase for a fixed term and crediting rate; (2) set at the time of purchase for a fixed term and variable crediting rate, or (3) set at the time of purchase and reset monthly within a "constant duration." A constant duration contract may specify a duration of 2.5 years and the crediting rate is adjusted monthly based upon quarterly rebalancing of eligible 2.5 year duration investment instruments at the time of each resetting; in effect the contract never matures. At December 31, 2003 and 2002, the interest crediting rates for GICs and Fixed Maturity SICs ranged from 3.58% to 8.02% and 3.27% to 8.05%, respectively. For the years ended December 31, 2003 and 2002, the average annual yield for the investment contracts in the Fund was 5.31% and 5.74%, respectively. Fair value of the GICs was estimated by discounting the weighted average of the Fund's cash flows at the then-current, interest-crediting rate for a comparable maturity investment contract. Fair value for the SICs was estimated based on the fair value of each contract's supporting assets at December 31, 2003 and 2002. 8 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Notes to Financial Statements (continued) 3. INVESTMENTS (CONTINUED) The composition of net assets of the Alliance Equity Master Trust at December 31, 2003 and 2002 was as follows:
2003 2002 --------------------------------- Investment in pooled separate accounts: Alliance Equity Fund S.A. #4 $ 35,666,427 $ 26,603,639 Operating payables (10,616) (49,895) --------------------------------- Total net assets $ 35,655,811 $ 26,553,744 =================================
The composition of net assets of the Allegheny Technologies Disciplined Stock Fund Master Trust at December 31, 2003 and 2002 was as follows:
2003 2002 --------------------------------- Corporate common stocks $ 77,259,404 $ 53,256,475 Interest in common collective trusts 337,451 1,630,752 Receivables 283,072 67,848 Payables (42,301) (25,733) --------------------------------- Total net assets $ 77,837,626 $ 54,929,342 =================================
9 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Notes to Financial Statements (continued) 3. INVESTMENTS (CONTINUED) The composition of the changes in net assets of the various master trusts is as follows:
ALLEGHENY TECHNOLOGIES DISCIPLINED STOCK FUND MASTER FIXED INCOME MASTER TRUST ALLIANCE EQUITY MASTER TRUST TRUST ------------------------------------------------------------------------------------------------ YEARS ENDED DECEMBER 31 ------------------------------------------------------------------------------------------------ 2003 2002 2003 2002 2003 2002 ------------------------------------------------------------------------------------------------ Investment income (loss): Interest income $ 9,953,790 $ 9,786,577 $ - $ - $ 214,654 $ - Net realized/unrealized gain (loss) on corporate common stocks - 1,528 - - 13,699,382 (17,406,255) Dividends - - - - 1,073,159 948,623 Net gain (loss), registered invest- ment companies 45,315 - - - - - Net gain (loss), pooled separate accounts - - 9,614,660 (10,652,634) - - Net gain, common collective trusts 111,616 172,081 - - 10,183 13,761 Other income - 69,815 - - - - Administrative expenses (201,917) (236,944) (72,409) (118,618) (660,982) (424,085) Transfers 888,462 5,374,077 (440,184) (2,634,913) 8,571,888 (5,733,400) ------------------------------------------------------------------------------------------------ Net increase (decrease) 10,797,266 15,167,134 9,102,067 (13,406,165) 22,908,284 (22,601,356) Total net assets at beginning of year 180,809,389 165,642,255 26,553,744 39,959,909 54,929,342 77,530,698 ------------------------------------------------------------------------------------------------ Total net assets at end of year $ 191,606,655 $ 180,809,389 $ 35,655,811 $ 26,553,744 $ 77,837,626 $ 54,929,342 ================================================================================================
Interest, realized and unrealized gains and losses, and management fees from the master trusts are included in the net gain (loss) from interest in Allegheny Technologies Incorporated Savings Plan Trust on the statements of changes in net assets available for benefits. 10 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Notes to Financial Statements (continued) 4. INCOME TAX STATUS The Plan has received a determination letter from the Internal Revenue Service dated July 25, 2003, stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code (the Code) and, therefore, the related trust is exempt from taxation. The determination letter does not include Plan amendments subsequent to July 1, 2001. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The plan administrator believes the Plan is being operated in compliance with the applicable requirements of the Code and, therefore, believes that the Plan, as amended, is qualified and the related trust is tax-exempt. 5. PARTIES-IN-INTEREST Dreyfus Corporation is the manager of the Dreyfus Mutual Funds that are offered as investment options under this Plan. Dreyfus Service Corporation is the funds' distributor. Dreyfus Corporation and Dreyfus Service Corporation are both wholly owned subsidiaries of Mellon Financial Corporation. Mellon Financial Corporation also owns Mellon Bank, N.A., the trustee for this Plan. Therefore, transactions with these entities qualify as party-in-interest transactions. 6. PLAN TERMINATION Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. 7. RISKS AND UNCERTAINTIES The Plan invests in various investment securities. Investment securities are exposed to various risk such as interest rate, market, and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants' account balances and the amounts reported in the statements of net assets available for benefits. 11 Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan EIN: 25-1792394 Plan: 005 Schedule H, Line 4i--Schedule of Assets (Held at End of Year) December 31, 2003
DESCRIPTION UNITS/SHARES CURRENT VALUE - --------------------------------------------------------------------------------------------- Registered Investment Companies - ------------------------------- Dreyfus Emerging Leaders Fund* 172,913.112 $ 6,695,196 Dreyfus Bond Market Index * 146,469.653 1,517,426 Dreyfus International Value Fund* 163,994.983 2,710,837 Artisan Funds 99,574.743 2,567,037 Dreyfus Appreciation Fund * 3,401.693 126,339 Oakmark Balanced Fund 310,482.463 6,836,824 Hartford Midcap Fund 29,983.480 738,493 Lord, Abbett Midcap Fund 13,663.709 257,287 MFS Value Fund 8,417.638 171,214 Morgan Stanley Small Growth Fund 21,446.975 231,842 PIMCO - NFJ Fund 10,386.196 260,382 PIMCO - Total Return Fund 18,190.757 194,823 Jennison Growth Fund 67,655.750 883,584 -------------- Total registered investment companies $ 23,191,284 ============== Common Collective Trusts - ------------------------ Dreyfus Short-Term Investment Fund* 134,103.470 $ 134,103 ============== Corporate Common Stocks - ----------------------- Allegheny Technologies Incorporated* 807,472.756 $ 10,674,790 ============== Participant loans* (5.0% to 10.5%, with maturities through 2018) $ 5,619,359 ==============
*Party-in-interest 12 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the administrators of the Plan have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. ALLEGHENY TECHNOLOGIES INCORPORATED ALLEGHENY LUDLUM CORPORATION PERSONAL RETIREMENT AND 401(K) SAVINGS ACCOUNT PLAN By: /s/ Richard J. Harshman ----------------------------------- Date: June 25, 2004 Richard J. Harshman Executive Vice President-Finance and Chief Financial Officer (Principal Financial Officer and Duly Authorized Officer) 13 EX-23.1 2 j0815201exv23w1.txt CONSENT EXHIBIT 23.1 Consent of Independent Registered Public Accounting Firm We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 333-10225) pertaining to the Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan of our report dated June 18, 2004, with respect to the financial statements and schedule of the Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan included in this Annual Report (Form 11-K) for the year ended December 31, 2003. /s/ Ernst & Young LLP Pittsburgh, Pennsylvania June 24, 2004 -----END PRIVACY-ENHANCED MESSAGE-----