-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, Bzj8cMlmIf3ZetAwqjI7FhD/RU3wcM/CtgMEayBIyb71NtNGWBX/7EMhArNpKniH tPEmbu7UXVGDN8HPjgsTEg== 0000950129-94-000520.txt : 19940702 0000950129-94-000520.hdr.sgml : 19940702 ACCESSION NUMBER: 0000950129-94-000520 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19931231 FILED AS OF DATE: 19940627 FILER: COMPANY DATA: COMPANY CONFORMED NAME: QUANEX CORP CENTRAL INDEX KEY: 0000276889 STANDARD INDUSTRIAL CLASSIFICATION: 3312 IRS NUMBER: 381872178 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-05725 FILM NUMBER: 94535958 BUSINESS ADDRESS: STREET 1: 1900 W LOOP SOUTH STE 1500 CITY: HOUSTON STATE: TX ZIP: 77027 BUSINESS PHONE: 7139614600 MAIL ADDRESS: STREET 1: 1900 WEST LOOP SOUTH STREET 2: SUITE 1500 CITY: HOUSTON STATE: TX ZIP: 77027 11-K 1 FORM 11-K DATED 12/31/93 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 11-K (Mark One) /X/ ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED] For the fiscal year ended December 31, 1993 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 1-5725 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Quanex Corporation Hourly Bargining Unit Employees Savings Plan B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Quanex Corporation 1900 West Loop South, Suite 1500 Houston, Texas 77027 Phone: (713) 961-4600 2 SIGNATURES The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. DATE ---------------------------------- 3 Deloitte & Touche Suite 2300 Telephone: (713) 756-2000 333 Clay Street Facsimile: (713) 756-2001 Houston, Texas 77002-4196 INDEPENDENT AUDITORS' REPORT The Benefit Committee Quanex Corporation Houston, Texas RE: Quanex Corporation Hourly Bargaining Unit Employees Savings Plan We have audited the accompanying statements of net assets available for benefits of the Quanex Corporation Hourly Bargaining Unit Employees Savings Plan (the "Plan") as of December 31, 1993 and 1992, 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 generally accepted auditing standards. 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 present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 1993 and 1992, and the changes in net assets available for benefits for the years then ended in conformity with generally accepted accounting principles. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying supplemental information by fund and supplemental schedules of (1) investments as of December 31, 1993 and (2) 5% reportable transactions for the year ended December 31, 1993 are presented for the purpose of additional analysis of the basic financial statements rather than to present information regarding the net assets available for benefits and changes in net assets available for benefits on the individual funds. This information and these schedules are not a required part of the basic financial statements. The schedules are 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. This supplemental information and these schedules are the responsibility of the Plan's management. Such supplemental information and schedules have been subjected to the auditing procedures applied in our audit of the basic financial statements and, in our opinion, are fairly stated in all material respects when considered in relation to the basic financial statements taken as a whole. /s/ DELOITTE & TOUCHE April 26, 1994 4 QUANEX CORPORATION HOURLY BARGAINING UNIT EMPLOYEES SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, -------------------------- 1993 1992 ----------- ----------- Assets: Investments, at fair value: Mutual fund assets $2,249,402 $1,324,613 Quanex common stock 15,617 6,500 ---------- ---------- 2,265,019 1,331,113 Deposits with insurance company, at contract value 281,373 362,774 ---------- ---------- Total 2,546,392 1,693,887 ---------- ---------- Employee contributions receivable 74,473 63,803 ---------- ---------- Net assets available for benefits $2,620,865 $1,757,690 ========== ==========
See notes to financial statements. 2 5 QUANEX CORPORATION HOURLY BARGAINING UNIT EMPLOYEES SAVINGS PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, -------------------------- 1993 1992 ----------- ----------- Investment Income: Interest and dividends $ 148,229 $ 102,700 Net appreciation (depreciation) in fair value of investments 72,733 (29,049) ---------- ---------- Total 220,962 73,651 ---------- ---------- Employee contributions 830,367 717,563 ---------- ---------- Total additions 1,051,329 791,214 ---------- ---------- Benefit payments 188,154 71,164 ---------- ---------- Increase in net assets available for benefits 863,175 720,050 ---------- ---------- Net assets availabe for benefits: Beginning of year 1,757,690 1,037,640 ---------- ---------- End of year $2,620,865 $1,757,690 ========== ==========
See notes to financial statements. 3 6 QUANEX CORPORATION HOURLY BARGAINING UNIT EMPLOYEES SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1993 and 1992 A. THE PLAN The following brief description of the Quanex Corporation Hourly Bargaining Unit Employees Savings Plan (the "Plan")is provided for general information purposes only. Participants should refer to the Plan agreement for more complete information. (1) General. The Plan, originally named the Quanex Corporation Hourly Employees Savings Plan, became effective January 1, 1989 and is sponsored by Quanex Corporation (the "Company"). The Plan began receiving contributions in April 1989. The Plan is a defined contribution plan which is subject to the Employee Retirement Income Security Act of 1974 ("ERISA"). The Plan is a voluntary savings plan in which hourly employees of certain divisions of the Company are eligible to participate after completing three months of active service. The assets of the Plan are held in trust by Fidelity Management Trust Company (the "Trustee"). The Benefits Committee (the "Committee"), appointed by the Board of Directors of the Company, serves as the Plan administrator. (2) Contributions. Participants may elect to make contributions up to 15% of their before-tax annual compensation or up to 10% of their after-tax compensation as defined by the Plan agreement. There are no provisions in the Plan agreement for matching contributions by the Company. (3) Participant Accounts. Each participant's account is credited with the participant's contribution and an allocation of investment income, which is based on the participant's account balances as of the end of the period in which the income was earned. (4) Investment Options. The Plan as seven investment funds managed by the Trustee, as follows: Government Money Market Fund--composed of short-term goverment obligations Short-Intermediate Government Fund--invested and reinvested in securities issued by the U.S. government. Puritan Fund--invested and reinvested in common and preferred stock and bonds. Magellan Fund--invested and reinvested in equity and debt securities of foreign and domestic companies. Growth and Income Fund--invested and reinvested in equity and debt securities of foreign and domestic companies. Overseas Fund--invested and reinvested in foreign securities. Quanex Common Stock Fund--invested and reinvested in common stock of Quanex Corporation. Additionally, the Plan has investments in a series of guaranteed investment contracts. Refer to Note C for further information. The Short-Intermediate Government Fund replaced the Intermediate Bond Fund during January 1993. 4 7 (5) VESTING. Participants became immediately vested in their voluntary contribution and related earnings. (6) PAYMENT OF BENEFITS. Upon termination of service, the participant may elect to receive a lump-sum amount equal to the total of vested benefits in his or her account. Benefits payable were $0 as of December 31, 1993 and 1992. (B) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (1) ACCOUNTING BASIS. The financial statements are prepared on the accrual basis of accounting. (2) INVESTMENTS. The Plan recognizes net appreciation on depreciation in the fair value of its investments. Investments are reflected at fair value in the financial statements. Fair value for mutual funds is determined using quoted net asset value. Fair value for Quanex common stock, which is listed on the New York Stock Exchange, is determined using the last recorded sales price. (3) ADMINISTRATIVE EXPENSES. Since inception of the Plan, the Company has paid for all administrative expenses. C. DEPOSITS WITH INSURANCE COMPANY In 1989 the Plan entered into a series of guaranteed investment contracts with Metropolitan Life Insurance Company ("Metropolitan") for the Fixed Income Fund. The contracts provide a guaranteed rate of return on principal invested which is credited to the Plan for the length of the contracts. The contracts are charged for Plan withdrawals. The contract is included in the financial statements at the December 31, 1993 and 1992 contract values as reported to the Plan by Metropolitan. The remaining contracts mature between January 1, 1994 and January 1, 1995 and provide an interest rate of 8.3%. D. PLAN TERMINATION Although it has not expressed any intent to do so, the Company has the right under the Plan to terminate the Plan subject to the provisions of ERISA. In the event of termination of the Plan, the assets held by the Trustee under the Plan will be valued and fully vested, and each Participant will be entitled to distributions respecting his or her account. E. FEDERAL INCOME TAX STATUS The Plan is subject to specific rules and regulations related to employee benefit plans under the Department of Labor and the Internal Revenue Service (IRS). The Plan has received a favorable determination letter from the IRS dated June 11, 1990. As such, the Plan is a qualified trust under Sections 401(a) and 401(k) of the Internal Revenue Code of 1986 (the ("Code") and, as a result, is exempt from federal income taxes under Code Section 501(a). The Company believes that the Plan is currently designed and being operated in compliance with the applicable requirements of the Code. Therefore, it believes that the Plan was qualified and the related trust was tax-exempt as of the financial statement dates. F. RELATED PARTY TRANSACTIONS During the years ended December 31, 1993 and 1992, the Plan purchased and sold shares of Quanex common stock, as shown: 5 8
1993 1992 ----------------- ------------------ Shares Cost Shares Cost ------ ------- ------ ------ 565 $10,008 333 $7,934
During the years ended December 31, 1993 and 1992, the Plan sold 5 and 41 shares of Quanex common stock for $95 (cost $108) and $1,185 (cost $949), respectively. During the years ended December 31, 1993 and 1992, the Plan purchased shares of Fidelity, the Trustee, mutual fund assets, as shown below:
1993 1992 -------------------- -------------------- Shares Cost Shares Cost ------- ---------- ------- -------- 455,285 $1,317,149 337,786 $881,174
During the years ended December 31, 1993 and 1992, the Plan sold 260,007 and 137,595 shares of Fidelity mutual fund assets for $465,887 (cost $463,721) and $162,379 (cost $163,425), respectively. G. SUBSEQUENT EVENTS Effective March 1994, the Plan added the Fidelity Balanced Fund and the Fidelity Contrafund as investment options. The Fidelity Balanced Fund invests in common and preferred stocks and bonds. The Fidelity Contrafund invests in equities of foreign and domestic companies. 6 9 H. ALLOCATION OF NET ASSETS AVAILABLE FOR BENEFITS TO INVESTMENT FUNDS The following tables provide supplemental information regarding the net assets available for benefits by investment fund.
December 31, 1993 ------------------------------------------------------------- SHORT- GOVERN- INTER- MENT MEDIATE INTER- MONEY GOVERN- MEDIATE MARKET MENT BOND PURITAN TOTAL FUND FUND FUND FUND ---------- -------- -------- -------- -------- Assets: Investments, at fair value: Mutual fund assets $2,249,402 $907,094 $168,313 $ 0 $333,054 Quanex common stock 15,617 ---------- -------- -------- -------- -------- 2,265,019 907,094 168,313 0 333,054 ---------- -------- -------- -------- -------- Deposits with insurance company, at contract value 281,373 ---------- -------- -------- -------- -------- Total 2,546,392 907,094 168,313 0 333,054 Employee contributions receivable 74,473 24,184 5,945 0 12,298 ---------- -------- -------- -------- -------- Net assets available for benefits $2,620,865 $931,278 $174,258 $ 0 $345,352 ========== ======== ======== ======== ========
December 31, 1993 ------------------------------------------------------------- GUARAN- GROWTH QUANEX TEED AND COMMON INVEST- INCOME MAGELLAN OVERSEAS STOCK MENT FUND FUND FUND FUND CONTRACT ---------- -------- -------- -------- -------- Assets: Investments, at fair value: Mutual fund assets $45,120 $658,370 $137,451 Quanex common stock $15,617 ------- -------- -------- ------- -------- 45,120 658,370 137,451 15,617 ------- -------- -------- ------- -------- Deposits with insurance company, at contract value $281,373 ------- -------- -------- ------- -------- Total 45,120 658,370 137,451 15,617 281,373 Employee contributions receivable 2,619 23,809 4,779 839 0 ------- -------- -------- ------- -------- Net assets available for benefits $47,739 $682,179 $142,230 $16,456 $281,373 ======= ======== ======== ======= ========
December 31, 1992 ------------------------------------------------------------- SHORT- GOVERN- INTER- MENT MEDIATE INTER- MONEY GOVERN- MEDIATE MARKET MENT BOND PURITAN TOTAL FUND FUND FUND FUND ---------- -------- -------- -------- -------- Assets: Investments, at fair value: Mutual fund assets $1,324,613 $737,890 $ 0 $122,552 $141,169 Quanex common stock 6,500 ---------- -------- -------- -------- -------- 1,331,113 737,890 0 122,552 141,169 ---------- -------- -------- -------- -------- Deposits with insurance company, at contract value 362,774 ---------- -------- -------- -------- -------- Total 1,693,887 737,890 0 122,552 141,169 Employee contributions receivable 63,803 24,217 0 7,738 10,307 ---------- -------- -------- -------- -------- Net assets available for benefits $1,757,690 $762,107 $ 0 $130,290 $151,476 ========== ======== ======== ======== ========
December 31, 1992 ------------------------------------------------------------- GUARAN- GROWTH QUANEX TEED AND COMMON INVEST- INCOME MAGELLAN OVERSEAS STOCK MENT FUND FUND FUND FUND CONTRACT ---------- -------- -------- -------- -------- Assets: Investments, at fair value: Mutual fund assets $ 0 $265,744 $57,258 Quanex common stock $6,500 ------- -------- ------- ------ -------- 0 265,744 57,258 6,500 0 ------- -------- -------- ------ -------- Deposits with insurance company, at contract value $362,774 ------- -------- -------- ------ -------- Total 0 265,744 57,258 6,500 362,774 Employee contributions receivable 0 17,076 3,636 829 0 ------- -------- ------- ------ -------- Net assets available for benefits $ 0 $282,820 $60,894 $7,329 $362,774 ======= ======== ======= ====== ========
10 ALLOCATION OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS TO INVESTMENT FUNDS The following tables provide supplemental information regarding the change in net assets available for benefits by investment fund.
DECEMBER 31, 1993 ----------------------------------------------------------------------------------------------------- SHORT- GOVERN- INTER- GUARAN- MENT MEDIATE INTER- GROWTH TEED MONEY GOVERN- MEDIATE AND INVEST- MARKET MENT BOND PURITAN INCOME MAGELLAN OVERSEAS STOCK MENT TOTAL FUND FUND FUND FUND FUND FUND FUND FUND CONTRACT ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Investment income: Interest and dividends $ 148,229 $ 24,976 $ 8,423 $ 695 $ 35,791 $ 1,810 $ 51,782 $ 2,034 $ 366 $ 22,352 Net appreciation (depreciation) In fair value of investments 72,733 0 (1,528) 1,596 7,138 1,038 37,436 27,849 (796) 0 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Total 220,962 24,976 6,895 2,291 42,929 2,848 89,218 29,883 (430) 22,352 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Employee contributions 830,367 308,695 83,210 0 131,221 19,410 234,239 44,340 9,252 0 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Total additions 1,051,329 333,671 90,105 2,291 174,150 22,258 323,457 74,223 8,822 22,352 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Benefit payments 188,154 110,154 9,306 0 12,036 218 18,226 3,273 95 34,846 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Fund transfers 0 (54,346) 93,459 (132,581) 31,762 25,699 94,128 10,386 400 (68,907) ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Increase in net assets available for benefits: 863,175 169,171 174,258 (130,290) 193,876 47,739 399,359 81,336 9,127 (81,401) ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Net assets available for benefits: Beginning of year 1,757,690 762,107 0 130,290 151,476 0 282,820 60,894 7,329 362,774 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- End of year $2,620,865 $931,278 $174,258 $ 0 $345,352 $ 47,739 $682,179 $142,230 $ 16,456 $281,373 ========== ======== ======= ======== ======== ======== ======== ======== ======== ========
11 ALLOCATION OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS TO INVESTMENT FUNDS (continued)
DECEMBER 31, 1992 ----------------------------------------------------------------------------------------------------- SHORT- GOVERN- INTER- GUARAN- MENT MEDIATE INTER- GROWTH TEED MONEY GOVERN- MEDIATE AND INVEST- MARKET MENT BOND PURITAN INCOME MAGELLAN OVERSEAS STOCK MENT TOTAL FUND FUND FUND FUND FUND FUND FUND FUND CONTRACT ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Investment income: Interest and dividends $ 102,700 $ 22,429 $ 0 $ 6,128 $ 10,192 $ 0 $ 29,236 $ 6,323 $ 102 $ 28,290 Net appreciation (depreciation) in fair value of investments (29,049) 0 0 (1,198) 1,555 0 (14,990) (13,051) (1,365) 0 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Total 73,651 22,429 0 4,930 11,747 0 14,246 (6,728) (1,263) 28,290 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Employee contributions 717,563 291,028 0 92,577 102,638 0 174,290 49,595 7,435 0 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Total additions 791,214 313,457 0 97,507 114,385 0 188,536 42,867 6,172 28,290 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Benefit payments (71,164) (50,283) 0 (2,628) (552) 0 (1,211) (571) (1,185) (14,734) ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Fund transfers 0 (88,135) 0 11,981 13,740 0 56,332 5,313 769 0 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Increase in net assets available for benefits: 720,050 175,039 0 106,860 127,573 0 243,657 47,609 5,756 13,556 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Net assets available for benefits: Beginning of year 1,037,640 587,068 0 23,430 23,903 0 39,163 13,285 1,573 349,218 ---------- -------- -------- -------- -------- -------- -------- -------- -------- -------- End of year $1,757,690 $762,107 $ 0 $130,290 $151,476 $ 0 $282,820 $ 60,894 $ 7,329 $362,774 ========== ======== ======= ======== ======== ======== ======== ======== ======== ========
12 Item 27a - Schedule of Assets Held for Investment Purposes EIN: 38-1872178; PN: 015 QUANEX CORPORATION HOURLY BARGAINING UNIT EMPLOYEE SAVINGS PLAN SUPPLEMENTAL SCHEDULE OF INVESTMENTS DECEMBER 31, 1993
Shares/ Cost of Current Par Value Acquisition Value --------- ----------- ---------- Mutual fund assets: Fidelity Investments Government Money Market Fund* 907,094 $ 907,094 $ 907,094 Fidelity Investments Short-Intermediate Government Fund* 17,036 169,780 168,313 Fidelity Investments Puritan Fund* 21,146 324,859 333,054 Fidelity Investments Growth and Income Fund* 2,031 44,088 45,120 Fidelity Investments Magellan* 9,292 636,186 658,370 Fidelity Investments Overseas Fund* 5,011 121,763 137,451 ---------- ---------- Total mutual fund assets 2,203,770 2,249,402 ---------- ---------- Common stock: Quanex Corporation* 899 17,845 15,617 ---------- ---------- Deposits with insurance company: Metropolitan Life Guaranteed Investment Contract N/A 281,373 281,373 ---------- ---------- Total investments $2,502,988 $2,546,392 ========== ==========
* Party-in-Interest 13 Item 27d - Schedule of Reportable (5%) Transactions EIN: 38-1872178; PN: 015 QUANEX CORPORATION HOURLY BARGAINING UNIT EMPLOYEE SAVINGS PLAN SUPPLEMENTAL SCHEDULE OF 5% REPORTABLE TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31,1993 Single Transactions
Current Value of Asset on Net Purchase Selling Cost of Transaction Gain or Description of Assets Price Price Asset Date (Loss) ---------------------- --------- ------- ------- ----------- ------- Mutual Fund Assets: Fidelity Investments* Short-Intermediate Government Fund $127,488 $127,488 Intermediate Bond Fund $127,488 $126,702 127,488 $786
Series of Transactions
Total Number of Total Current Value Purchases Number of of Asset on Net Gain During Purchase Sales During Selling Transaction or Description Plan Year Price Plan Year Price Cost of Asset Date (Loss) ----------- ---------- -------- ------------ ------- ------------- ---------- -------- Mutual Fund Assets: Fidelity Investments* Government Money Market Fund 68 $409,970 $409,970 52 $240,766 $240,766 240,766 -- Short-intermediate Government Fund 46 219,202 219,202 19 49,362 49,422 49,362 ($60) Intermediate Bond Fund 3 8,433 8,433 2 132,581 131,804 132,581 777 Puritan Fund 29 204,233 204,233 10 19,486 18,596 19,486 890 Magellan Fund 40 374,401 374,401 11 19,210 18,432 19,210 778 Deposits with Insurance Company: - - - - - -------------------------------- Guaranteed Investment Contract 21 22,352 22,352 9 103,753 103,753 103,753 --
- - - - - ---------------- *Party-in-Interest 14 INDEX TO EXHIBITS
EXHIBIT NUMBER 23.1 Independent Auditor's Consent
EX-23.1 2 INDEPENDENT AUDITORS CONSENT 1 EXHIBIT 23.1 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in Registration Statement No. 33-46824 of Quanex Corporation on Form S-8 of our report dated April 26, 1994, appearing in this Annual Report on Form 11-K of Quanex Corporation Hourly Bargaining Unit Employees Savings Plan for the year ended December 31, 1993. /s/ Deloitte & Touche - - - - - ------------------------------ DELOITTE & TOUCHE Houston, Texas June 27, 1994 -----END PRIVACY-ENHANCED MESSAGE-----