Glassport, Pennsylvania


History of the Copperweld Steel Company's Glassport Operations.


Many thanks to Ralph J. Farmerie(GHS'57) for providing the annual reports from which most of this history was extracted. The basic text of the following history was taken from a research report entitled "PROGRESS AND DEVELOPMENT OF THE COPPERWELD STEEL COMPANY (1915-1945)", BY RALPH JOHN FARMERIE, which was completed in partial fulfillment of his Master of Education degree at California State College, California, PA in 1973.


Ancient Assyrians, Babylonians, and the Swiss Lake dwellers used tools and weapons composed of an iron core with a copper alloy covering. Historically, one can see the desirability of combining the strength of iron or steel with the non-corrosive properties of copper. It was not until the nineteenth century that serious attempts were made to combine the properties of steel and copper in producing new products.

The earliest patent on a process which achieved this combination in a single product was issued in 1821 in England. By melting copper in a shallow cast iron pan, the patentee was able to make durable iron pans which were protected from corrosion by the copper lining. The success of this process was limited to specific products; accordingly, the process could not be applied to the production of wire or wire products. It was not until the 1860's that two American metallurgists, Moses Farmer and Samual Milliken, experimented in producing a steel and copper wire by wrapping steel wire with copper strips and tinning the result. After numerous experiments in determining the electrical and physical characteristics of this wire, it was a commercial failure: the copper strips would not adher to the steel wire.

In 1885, a French metallurgist made a composite billet by placing a copper collar around the mid section of a cyclindrical steel billet, and rolling the billet, in order to spread the copper over its outer surface. By careful handling, the copper covered billet was rolled and drawn into wire. But since the two metals were not joined by a weld, the copper served only as a shell.

By 1905, with the establishment of the Duplex Metals Company of Rankin, Pennsylvania, ideas began to change concerning the union of steel and copper. The Duplex Company began to weld steel and copper. This method, the Monnet process, consisted of dipping a specially prepared steel billet into a copper bath, thus wetting the steel with copper. The wet steel billet was then placed in a mold containing molten copper to form a copper-clad ingot. After cooling, the ingot was withdrawn from the mold, hot rolled, and drawn to rod and wire sizes. The composite rods possessed the strength and toughness of steel and the electrical and non-corrosive properties of copper. The Monnet process did not create an electrolysis between the two metals if carried out in the proper manner. However, the expense involved in the procedure forced the company out of business.

It was in 1915 that an idea was developed by five American men. These men S. E. Bramer, a diamond industrialist, Jacob Roth and Simon Loeb, producers of battery type radios, William Smith, Sr., general superintendent in a Rankin, Pennsylvania plant, and F. R. S. Kaplan, a lawyer, combined their resources and rented a building in Rankin, Pennsylvania, which was to house their new company, the Copper Clad Steel Company. On August 16, 1915, the mill began operations with the aid of Thomas Brewer, Superintendent of Fabricating, S. L. Gibson, the first roller who later became Superintendent of the Rolling Mill, and George Bain, Sr., an engineer and the head salesman for the company. The entire labor force consisted of twenty-three men. The Copper Clad Steel Company, later to become the Copperweld Steel Company, began the manufacture of copper-covered steel wire. The Copperweld process, less complex than previous methods, was based primarily on obtaining a molten weld between copper and steel.

In 1923 a near tragedy threatened to destroy the young company when lightning struck the power company's transformer located in the wire mill. The resulting fire destroyed the wire mill and dye room as well as the shipping and testing departments.

In 1925, Copperweld copper wire was used to span a 4,810 foot gorge across the Cheat River in West Virginia. Two years later, the longest single span of Copperweld copper wire, one of the longest spans of wire in the world, was extended across the Smoke River Canyon in Idaho. Because of the high strength, conductivity, and permanence of Copperweld, a span of some 6,800 feet was possible.

As a result of a growing demand for their products, the Rankin plant became too small to handle production. To meet new demands, the firm purchased the Axe and Tool works in Glassport, Pennsylvania in May, 1927.

In the fall of 1927, the Copperweld Steel Company began manufacturing its products in Glassport, its present headquarters.

During the early years of the depression, only through the successful efforts of Copperweld's sales department was the plant able to remain open. A principal contract with the United States Army Corps of Engineers was obtained by the company. The Army had selected non-rusting Copperweld wire for revetment fabric in flood control measures along the Mississippi River. Army Engineers working on flood control found the Copperweld wire, with its strength and corrosive resistance, ideal for reinforcing and tying together articulated concrete mats used on rivers to prevent bank erosion.

In the middle nineteen thirties, the electrification program for rural districts intensified, and Copperweld copper conductors immediately proved excellent for the building of long span rural lines. This began a new phase in the development of the company. Copperweld products also found their way into a variety of related industries. Copperweld wire and strand were used by electric light and power companies for overhead ground wires on transmission lines, pole guys, and as messengers for supporting aerial power cables. Furthermore, Copperweld wire was used in various combinations with other copper wires for power conductors. In the telephone field, Copperweld wire was used extensively as "drop wire" for connecting subscribers' premises to the company's lines. This wire was used exclusively by the world's leading telephone systems because of its strength, conductivity, mechanical ruggedness and long life. Its reliability and performance could not be excelled. Copperweld wire could safely withstand severe storm loads and other operating hazards to which drop wires are subjected.

Telephone companies used Copperweld wire for: (1) line wire on open wire construction; (2) guying; (3) aerial cable messengers.

The railroads were the next to see the advantages of Copperweld wire. They initially used the wire to complete the electrical circuit from rail to rail. It was also employed as signal line wire, guy and messenger strand and overhead ground wire. In addition to these uses, electrified roads took advantage of the Copperweld copper messenger as a combination conductor and trolley wire support.

Finally, Copperweld wire was widely adopted for use in manufacturing: (1) nonrusting nails and staples; (2) strong, long lasting barbed wire and fences that needed no painting; (3) long life wall ties for cavity wall construction; (4) ground rods and clamps.

This was only the beginning for the Copperweld Steel Company. In early 1939, the Copperweld plant made its greatest move towards expansion and development when they purchased a manufacturing site in Warren, Ohio. The factory in Warren was an alloy steel plant whose purpose was to produce special alloy steel and steel billet to be used at the Glassport plant in the manufacturing of Copperweld products. The Warren plant, known as the Aristrology Steel Division, began commercial production on October 1, 1940.

The company could not have selected a better time to expand. World War II had already begun, and in approximately one year the United States would be drawn into the conflict. Demand for specialty products, such as those produced by Copperweld, would increase as the war intensified. During the earlier period of World War II, the Copperweld Steel Company encountered the same situation it had faced during the Depression. Production and shipments dropped. This time because of wartime restrictions on the use of critical copper and steel. Fortunately, the Army Signal Corps came to the company's aid. In 1942 the Corps selected Copperweld wire for the telephone line paralleling the Alcan Highway to Alaska.

The Signal Corps used over 10,000 miles of Copperweld wire and auxiliary products such as power conductors, ground rods and clamps, overhead ground wires and guy wires. They found the rugged strength, high conductance and rust resistance of Copperweld products suitable to meet the severe operating requirements of Alaska's vital communication system. The efficient performance of the Copperweld Steel Company in producing and delivering the required quantities of wire for the Alaskan endeavor impressed the United States Army. As a result, by the end of 1942, it was not a question of whether the plant would remain open; rather, the question was how fast could the company manufacture materials for the Army and Navy.

Due to the Signal Corps' faith in the company, Copperweld's Glassport production was devoted entirely to the war effort. Approximately seventy-five percent of their output was being sold either to the government for the Army and the Navy or to the lend-lease program, with the Signal Corps receiving the greater share. A large part of the remaining twenty-five percent was incorporated into plant construction, war materials, or improving power utilities, railroads, and communications. Despite government sales, by the end of 1942, the Glassport production and sales volumes were sharply curtailed from 1941 levels. Shipments from May to September were at their lowest level since the depression years. It was during this 5 month period, however, that adoption of Copperweld products to war uses was effected. The contracts did not have an immediate impact: the net sales in 1942 of the two divisions amounted to $29,434,495 compared with $33,865,832 in 1941.

Various factors, such as new applications of Copperweld products, new products with resultant operating problems, a higher labor cost (due mostly to an increased labor force) and heavier charges for depreciation accounted for the loss in the company's net income in 1942 as compared to 1941. Conversely, production of electric-furnace steels in the Company's steel division at Warren, Ohio, was approximately fifty percent greater than that of 1941, with each quarter of 1942 showing a substantially increased volume over the preceding quarter. The following is a letter to the shareholders taken from the 1942 Annual Report:

Extracts from 1942 Annual Report

COPPERWELD STEEL CO.

GLASSPORT, PENNSYLVANIA

TO THE SHAREHOLDERS OF COPPERWELD STEEL COMPANY:

As a result of developments in 1942, Copperweld's Glassport production (coppercovered steel wire, cable, rods and related products) is now going entirely into the war effort. This has been true of our steel division since it started operations October 1, 1940.

Approximately 75 per cent of Glassport output is being sold directly to the Government for Army, Navy and Lend-lease. A large part of the remaining 25 per cent is being incorporated by our customers in war materials and all the remainder is for industries or applications essential to the war effort such as power, railroads, communications, plant construction, etc. The largest usage is in communication work for the Signal Corps. For the most part these usages represent the adoption of our standard products by the military services. The combination of tensile strength, permitting long spans, with the conservation of copper effected through the use of copper-covered steel instead of solid copper, makes the products eminently adaptable for these applications.

Our steel division also is contributing substantially to the war effort in its production of electric-furnace steels, critically necessary in the war program. The larger part of our steel is going into airplanes, the remainder being used in a wide variety of military applications.

In the 1941 Annual Report, certain opinions were expressed as to what might be expected in 1942. These opinions proved to be substantially correct. Glassport production and sales volume were sharply curtailed from 1941 levels, shipments from May to September, inclusive, having been at the lowest level since the depression years. It was during this five-month period, however, that adoption of our products to war uses was effected.

Results of operations of the Glassport division were adversely affected by various factors -decreased volume, new application of our products, and new products with resultant operating problems, higher labor costs, heavier charges for depreciation.

On the other hand, production of electric-furnace steels in the Company's steel division was approximately 50 per cent greater than that of 1941, each quarter of 1942 showing a substantially increased volume over the preceding quarter. Still greater volume should be had in 1943 when the various leased facilities come into full production.

Net sales in 1942 of the two divisions amounted to $29,434,495 compared with $33,865,832 in 1941.

Combined operations show a smaller profit in 1942 than in 1941 but the results are regarded by the Management as satisfactory in view of the heavy charges which were absorbed during the year. These are reviewed later in this report.

Extracts from 1942 Annual Report

PERSONNEL NOTES

CHANGES IN DIRECTORATE -During 1942 two vacancies occurred on the Board of Directors, neither of which has been filled. William K. Frank, formerly Chairman, resigned in order to devote his full time and attention to war work in Washington. Henry G. Riter, 3rd, senior partner of Riter & Co., investment bankers, who has been a director of the Company for several years, was elected Chairman.

It is with the greatest regret that shareholders are informed of the death of Charles M. Thorp, Esq., a distinguished member of the bar, who died on December 14, 1942. For a great many years Mr. Thorp served the interests of the Company in his capacity as director; a service characterized by extraordinary ability as well as loyalty and diligence. His long experience in both law and business gave his services an unusual value which will be most difficult to replace.

Copperwelders everywhere mourn the tragic and untimely death on February 20, 1943 of Stanton Hertz, Director, Vice President, and Assistant to the President. Associated with the Company since 1920. Mr. Hertz had long been a most beloved member of the organization. He will be remembered for his deep humanity and sincerity as well as for his devotion to the interests of the Company and to the welfare of its employees.

W. J. McIlvane, General Manager of Sales for the Glassport Division, has been elected to the Board of Directors and has been appointed Vice President and Assistant to the President.

C. W. Holmquist, Vice President in Charge of Glassport production, was elected a director at the 1942 Annual Meeting.

HONOR ROLL-More than 750 employees of the Company have entered the armed forces of the United States. These men and women carry the best wishes of every Copperwelder as well as their determination that those who remain in production will support them to the limit. Each was remembered at Christmas time.

This heavy loss of personnel has created a serious problem which is being met to the greatest extent possible through employment of women.

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That operations during the past year were beset with many serious problems is a fact which should require no emphasis. It could not be otherwise in times like these. Credit for "safe conduct" of the business for another year is due to the entire organization, each member of which did his part. The attitude of the entire personnel of both divisions, mill and office, has been that nothing is impossible during this war period. Without exception, the employees have taken the position of loyal Americans, interested in increasing production and in doing their part to end the war at the earliest possible date. There has been a closelybonded, harmonious relationship between Labor and Management which has been conducive to efficient operating results.

The splendid effort and achievement of the entire organization is gratefully acknowledged by the Board of Directors and the Management.

SHAREHOLDERS

Again shareholders are reminded that they have a most important function to perform in the management of a corporation. That function is to decide and instruct the Management on matters submitted to them. It is hoped that as many shareholders as possible will arrange to attend meetings in person and that those who cannot attend will express their opinions by vote. For the cooperation of shareholders during the past year, the Management expresses its sincere appreciation.

AND WHAT OF TOMORROW?

Post-war planning has not been neglected under the pressure of exigencies of the day. Until this war has been won, by far the most important work is to meet the problems of each day as they arise and to produce vital war materials to the limit of our ability. But while this has been going forward, efforts are being made to strengthen the position of the Company with respect to probable post-war markets and economic conditions, all to the end that at the termination of the war we shall be strong to enter into and take our place in the reconstruction period.

By order of the Board of Directors.

S. E. BRAMER, President.

Glassport, Pennsylvania
March 27, 1943.

Proxies for the Annual Meeting of Shareholders to be held April 28, 1943 will be requested by the Management prior to that meeting, and it is expected that Notice of Meeting and Proxy Statement will be sent to shareholders about April 2, 1943.

The operations in the steel division were carried on under difficult and trying conditions. Being a new plant, the labor force was comprised of an exceedingly large number of young men who were eligible for mili tary service. As a result, it became difficult to establish a sufficient nucleus of experienced employees. To add to the problem, the major construction program (Defense Plant Corporation facilities) started early in 1942 and continued throughout 1943, would in many instances, interfered physically with plant operations by: (1) interrupting the free flow of materials; (2) requiring the attention of management at all times which otherwise could have been devoted to day-to-day problems in operations. Fortunately, installation of the major components of the Warren facilities had been completed in 1940, and despite the aforementioned conditions,the production of steel tonnage by 1943 had increased 26.7 percent above the 1942 level and 38.17 percent above the 1941 level.

The ensuing problems at the Glassport division were different. At Glassport the nucleus of experienced personnel necessary to support an organization in time of war was present. The major problem was the market restrictions imposed by the War Productions Board. Operations were at a capacity level in respect to the types of products the Glassport division was permitted to manufacture. This included materials for the Army Signal Corps, other branches of the military and our Allies. The company's rate of production was only at sixty percent of its capacity when operating in a free market. Profit-wise, the products the division was largely limited to manufacturing (military) were not, and never had been products which could be made efficiently while cutting costs.

During 1943, the operations at the Glassport division improved. However, both the Glassport and Warren divisions were confronted with the problems common to most industries during the war: constantly rising labor costs and government controlled selling-price ceilings. The immediate outlook for the Copperweld Steel Company at that time, as well as for all industry, remained unpredictable. One point was certain. At Copperweld they could not make a reasonable profit with sales prises frozen at depression levels. The margin of safe and conservative operation had been constantly narrowing.

Copperweld's production was devoted entirely to the war effort. In September, 1943, the company was awarded the Army-Navy "E" Flag for meritorious and distinguished service to the country in its time of need. The award, presented by Colonel V. Parker, was accompanied by an official notification that the wire supplied by Copperweld had played an important role on every battle-front during the War. Glassport was proud to be the home of a company that received "four" Army-Navy "E" awards for its outstanding achievements in producing materials essential to the war effort.

Extracts from 1943 Annual Report

GENERAL REVIEW OF OPERATIONS

Operations in the steel division at Warren, Ohio, have been conducted under difficult and trying conditions. Being a new plant (commercial operations started late in 1940), the organization was comprised largely of young men, eligible for military service. Hence, inroads made by Selective Service have been very large and it has been necessary to withstand these without having a sufficient nucleus of men of long experience. With a strong nucleus, labor turnover and the use of inexperienced employees can be "taken in stride"; without it, difficulties mount. In addition, the major construction program (Defense Plant Corporation facilities), which started early in 1942, continued throughout 1943, in many instances interfering physically with operations-interrupting the free flow of materials-and at all times requiring time and attention of management which otherwise could have been devoted to the problems of day-to-day operations. -Fortunately, installation of the major part of the facilities has now been completed. Despite these conditions, however, production has increased, 1943 steel shipments (tonnage) having been 26.'7 per cent above 1942 and 38.7 per cent above 1941.

Problems at Glassport (the Company's wire and cable plant) have been different, but not less. Here there does exist the nucleus of experienced personnel so necessary to support an organization in times like these. Glassport's major problems stem from market restrictions imposed by the War Production Board. Operations have been at capacity with respect to the type of product which the Company is permitted to make. This, however, is only some 60 per cent of the overall production which can be, and in the past has been, obtained in a free market with the resultant well-balanced operations. Profit-wise, the products to which the division is largely limited are not, and never have been, the products which can be made most efficiently.

Operations at Glassport in 1943 were somewhat improved over 1942, in which year the conversion from production essentially civilian to that essentially military in nature was effected.

Both divisions, of course, are confronted with the problem, common to most industries, of constantly rising labor costs and Government controlled selling-price ceilings.- This results in an ever-increasing consumption of the sales dollar by costs, and a decrease in the amount available for reinvestment in the business. By whatever title called, and however it appears on the balance sheet, it is reinvestment of profits which must be relied upon by industry to cushion the shock of the post-war readjustment period. The combination of rising costs and fixed selling, price ceilings combats inflation, if at all, at the expense of post-war security of industry, and, in so doing, strikes at the roots of private enterprise. What is happening in this regard is graphically portrayed in the income chart appearing at the end of this report.

PERSONNEL NOTES

DIRECTORATE-R. Verne Mitchell was elected a director of the Company on June 25, 1943. Mr. Mitchell is president of Harris-Seybold-Potter Company, Cleveland, manufacturers of printing press equipment and is a director of Thompson Products, Inc., Cleveland, General Printing Ink Corporation, New York, and Cornell-Dubilier Electric Company, South Plainfield, New Jersey.

ORGANIZATION-Many important changes in the executive organization have been made but limitation of space precludes the mention of but a few.

Effective April 28, 1943, W. J. McIlvane, formerly Vice President (in charge of Glassport Sales) and Assistant to the President, was appointed Executive Vice President in Charge of the Company's Glassport Division.

C. W. Holmquist, formerly Vice President in charge of Glassport production, has been appointed Vice President and Assistant to the President on Operations. Mr. Holmquist's new duties were assumed February 1, 1944.

On August 1, 1943, M. H. Ronzone, formerly Controller of the Company's steel division, was appointed Treasurer, succeeding Thomas F. Troxell who resigned. Mr. Troxell has continued as a director of the Company.

MILITARY SERVICES-More than 1,200 Copperweld employees have now entered the military services. Representing approximately 40 per cent of Warren employees and approximately 23 per cent of Glassport employees, this has created most serious problems. Nevertheless, the Company is proud to be so well represented on the fighting fronts as well as on the home front.

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Each year, in the Annual Report to Shareholders, it has been the privilege of management to pay proper tribute to the employees of the Company for work well done. This year is no exception. Under constantly increasing difficulties the organization has carried on faithfully and to the best of its ability. With the stress of times like these, there can be no higher compliment.

THE OUTLOOK

SHORT RANGE

The immediate outlook for Copperweld Steel Company, as for all industry, remains unpredictable. Only one thing is certain: business can not make a reasonable profit with sales prices frozen at depression levels-true of both of our divisions-and with costs constantly rising under the fixed ceiling. The margin of safe and conservative operation has been constantly narrowing, as will be apparent from the figures appearing throughout this report and also shown graphically in the charts included in this report.

LONG RANGE

In the Company's Annual Report for 1940 a statement appears in the last paragraph. It seems appropriate that this be quoted at this time:

"Although not unmindful of the adverse possibilities inherent in the present situation, the Management of your Company looks to the future with optimism. Valuable lessons may and should be learned from present conditions. Most valuable and most to be hoped for is that as a nation we will realize that if we can mobilize resources and facilities to produce for defense, we can do the same to produce the requirements to give to all a higher standard of living. Faith in the essential soundness of our economic system, intelligence in the guidance of its functioning, and a national will-to-work should be sufficient to insure a reasonable degree of prosperity."

The management of Copperweld still subscribes to this opinion.

By order of the Board of Directors

S. E. BRAMER, President.

Glassport, Pennsylvania
March 20, 1944.

Proxies for the Annual Meeting of Shareholders to be held April 26, 1944 will be requested by the Management prior to that meeting and it is expected that Notice of Meeting and Proxy Statement will be sent to shareholders about March 31, 1944.

Extracts from 1944 Annual Report

GENERAL COMMENTS ON OPERATIONS

Tonnage output of steel at the Company's Warren, Ohio alloy steel plant was within a fraction of one per cent equal to that of 1943-an achievement which may be regarded as most satisfactory in view of the necessity of carrying on operations with a labor force entirely too small (11 per cent under standard at the beginning of the year; 26 per cent under at the end) and in many instances inexperienced. This, of course, directly affected production adversely as well as profits, heavy overtime payments representing only one phase of the latter.

Dollar volume of net sales of the steel division was down approximately 6 per cent in 1944 from 1943, reflecting a lower average selling price per ton. This also, of course, adversely affected profits.

Operations in the Company's Glassport, Pennsylvania "Copperweld" wire and cable plant were greatly improved over 1943, the tonnage volume in 1944 having been more than 35 per cent above that of 1943 and the second highest in the Company's history. This considerable improvement is due to several factors, important among them being increased demand for "Copperweld" wire for both military and civilian communication (telephone and telegraph) purposes and the lessening of War Production Board restrictions on the sale of certain products fabricated by the Company.

The Company's Glassport plant added two six-month stars to its Army-Navy "E" Flag during 1944 and the third in March 1945; the Warren plant during February 1945, after only 52 1/2 months of operations, passed the one million ton mark in alloy steel ingots produced.

PERSONNEL NOTES

HONOR ROLL - Copperweld Steel Company is proud of the fact that 1568 of its employees have joined the armed forces of the United States and are doing their part on every fighting front. Many have been killed. Many have been wounded, are missing in action, or are prisoners of war. Management expresses the feelings of the entire Copperweld organization in paying tribute to these men and women and most particularly to those who have given their lives that we at home may live in safety.

The members of the Copperweld organization have pledged their utmost efforts to continue to maintain the production of war materiel at the highest possible level as they did in 1944. The Management extends its congratulations and voices its admiration and sincere appreciation for a job well done under trying conditions.

THE POST-WAR OUTLOOK

As has been told shareholders before, the Company is not faced with any serious reconversion problems so far as facilities are concerned. A certain amount of deferred maintenance has accumulated, particularly in the Glassport plant, but the amounts involved are not of major importance.

Many steps have been taken looking to the development of post-war markets and diversification of products. During 1944 the Company acquired the controlling interest in SparHoll Manufacturing Company, West Orange, N. J. This company has a well-equipped small plant which will be operated largely as a research and product-development laboratory. It is believed that the work which has been done in the past by Spar-Roll, together with the work which will be undertaken in the future, may lead to the development of new products and new markets, primarily in the bi-metallic field.

Without permitting any interruption of production, the Company's steel division has carried on intensive work in connection with the development of specialties in the alloy steel field. As a result of this work it is reasonable to expect that the post-war competitive position of this division will be substantially strengthened.

For more than a year, work of a preliminary nature has been in progress looking to a greater development of foreign markets. In anticipation of increased activities in these fields during the post-war period, Copperweld Steel Company has organized two wholly-owned subsidiaries-Copperweld Steel International Company and Aristoloy Steel International Company through which, respectively, the export business of the "Copperweld" wire and cable division and the "Aristoloy" alloy steel division will be conducted.

Despite all the uncertainties of the post-war period which must be anticipated, the Management of Copperweld looks to the future with confidence. During the remainder of the war the functions of the organization will continue to be adapted to the fullest extent possible to war service; and after the war, to the program of national and international reconstruction which may be expected to follow.

By Order of the Board of Directors

S. E. BRAMER, President.

Glassport, Pennsylvania
March 23, 1945

Proxies for the Annual Meeting of Shareholders to be held April 25, 1945 will be requested by the Management prior to that meeting and it is expected that Notice of Meeting and Proxy Statement will be sent to shareholders about April 2, 1945.

Extracts from 1945 Annual Report

PERSONNEL NOTES

Mr. William K. Frank, who served the Company in various capacities from December, 1927 to May, 1942, at which time he resigned in order to devote his full attention to the War Production Board, was re-elected to the Directorate on October 31, 1945. At the same time he was elected as Chairman of the Executive Committee of the Board. Fellow members of the Board are most pleased to welcome Mr. Frank on his return to duty where his long business experience will contribute much to the welfare of the Company.

New labor agreements have been negotiated at both of the Company's plants and labor relations are presently satisfactory. The management feels that this result was obtained with a minimum of work stoppage (none at the Glassport plant) and wishes to express sincere appreciation for the loyalty of the organization under trying conditions.

AS TO THE FUTURE

GLASSPORT DIVISION - PRODUCER OF "COPPERWELD" (COPPER-COVERED STEEL) RODS, WIRE AND RELATED PRODUCTS.

The outlook for the Company's Glassport (wire and cable) business has never been brighter. With the coming of V-J Day, it became possible for the Company to return to the business of supplying its established public utility, railroad, telephone, and telegraph customers a job which had been interrupted early in 1942.

The very large demand which currently exists for the wire and cable products of this Company represents the development of 30 years. Today "Copperweld" rod, wire and strand products are recognized nationally and internationally and are used by many hundreds of public utilities, railroads, telephone, and telegraph companies on their overhead power, signal, and communication lines. During the war when Copperweld's wire and cable production was almost exclusively for the war effort, the advantages and outstanding performance of this unique product were observed by those who already have become normal, peacetime users of "Copperweld".

Although Copperweld-copper conductors are well and favorably known and have been widely used in the electrification of rural areas, this particular application represents but one of many markets. Rural electrification will continue to provide a very large demand for the next few years, but, in addition thereto, "Copperweld" is widely used by other wire buyers. Specific applications which presently afford important markets and which in the future should continue in even larger quantities are:

TELEPHONE DROP WIRE AND LINE WIRE Supplied in large volume to the leading telephone companies in the United States and in other countries;

WIRE AND STRAND PRODUCTS -- Purchased by electrified railroads for use as catenary messenger cables and by steam railroads for use as telephone, telegraph and signal line wire;

GROUND RODS AND COMPOSITE COPPERWELDCOPPER CONDUCTORS -Used by power systems, both publicly and privately financed, in large quantities and of many designs.

Thus, the wire and cable products of this division serve diversified markets and perform many tasks in the basic electric power, railroad, and communication fields.

The requirements from all of these basic markets have increased greatly since 1940 and are presently greater than the Company's productive capacity. Additional facilities have been and are being added and it is hoped that by the end of 1946 it will be possible for the Company to meet both the domestic and foreign demand.

COMBINED DIVISIONS

A favorable aspect bearing upon the welfare of both divisions is the assurance, during the next several months, of the steel supply which will be required by the wire and cable division. It is anticipated that this requirement will absorb a sizable percentage of the steel division's output, thus supplying a basic market for its products while at the same time protecting the continued operation of the wire and cable division.

If industry is to perform the functions which it should perform for its employees as well as for shareholders and consumers, it must be within the framework of a national economic policy which is balanced fairly as between costs and prices. It must be recognized that there is a limit beyond which costs cannot rise without a compensating price adjustment. As for Copperweld Steel Company, it can be said that, in a sound economy, with management permitted to deal with the problems which properly are management's responsibility, the future may be faced with confidence.

By Order of the Board of Directors.

S. E. BRAMER, President.

Glassport, Pennsylvania,
March 23, 1946.
Extracts from 1946 Annual Report

For the first time since 1932, there were no earnings left for reinvestment in the business after payment of the same dividends per share as have been paid in the last eight years, but rather part of the 1946 dividends were paid from earnings saved from prior years. Constant reinvestment of some part of the earnings of a business is essential to enable it to maintain its position or to expand, and the benefits from such reinvestment appear in the first instance as benefits to the workers who derive their livelihood from the business and who are vitally concerned in maintaining the continuity of operations and the expansion of employment.

CURRENT OPERATIONS AND OUTLOOK

Both divisions opened the year 1947 with excellent backlogs of orders. However, the shortage of steel scrap, main raw material of the steel division, which existed throughout 1946, is continuing in 1947 and conditions in the scrap market, pricewise, have been chaotic.

The price of copper, main raw material of the wire and cable division, which was held at 12 cents a pound throughout the war, has advanced in various steps until it is now selling at 21 1/2 cents a pound when it can be obtained. Domestic production of copper is far short of requirements and it is not feasible to use foreign copper for domestic purposes by reason of the duty of 4 cents a pound on all foreign copper imported into this country. This duty cannot be recovered unless the finished product is exported. Legislation is before Congress now with the view of suspending this duty during the critical shortage of domestic copper. It is hoped that this legislation will be enacted.

As it is the established practice of Copperweld to change the selling prices of its wire and cable products in conformity with each change in the price of copper, the Company is protected against increased copper costs. However, it must be recognized that if prices go too high, the point of buyer resistance will be met. When this happens, the potential customer may either defer his project or, worse yet, be forced to turn to cheaper substitutes.

Added to these difficulties related to raw material supplies and prices, Copper, weld's wire and cable plant was forced to curtail operations in February, 1947 due to shortage of natural gas. This unfortunate situation, which affected many in dustries in the Pittsburgh area, resulted in February operations at this plant being cut to approximately 30 per cent of normal capacity. This condition has continued into March, and March operations will be affected adversely as will operating results for the first quarter.

The foregoing clearly shows that the postwar reconversion period is not ended and that unsettled economic conditions still exist. On the more favorable side, however, the steel division has been successful in booking a substantial part of its business on a basis which provides protection to the Company against fluctuations in scrap costs. The capacity of the plant to a large extent is sold for the remainder of 1947 and at prices which should yield a reasonable profit. The wire and cable division is currently in the best position in its history so far as demands for its products and ability to meet these demands are concerned. In addition to the plant improvements heretofore mentioned, the Company's Board of Directors has authorized the installation of the necessary facilities to permit the use of oil as an alternate fuel on all furnaces of the wire and cable division. This installation will afford protection against future shortages of natural gas at this plant (a protection already had by the steel division plant) and at a cost which is regarded as low in relation to the "insurance" protection which will result.

Finally, the brake drum development heretofore mentioned is encouraging and it is expected that further announcements of progress will be made during the year. Thus, so far as factors within the control of the Company are concerned, the Management of Copperweld looks to the future with confidence. However, for the Company to realize fully the benefits inherent in its present position, it is necessary that labor costs do not get further out of line, that work stoppages be avoided, and that raw materials be steadily available - in other words, that there be a reasonable stabilization of the economic environment in which business functions. With such a reasonably stable economic environment, 1947 operations should show a substantial improvement over 1946.

By Order of the Board of Directors.

S. E. BRAMER, President.

Glassport, Pennsylvania,
March 21,1947

Proxies for the Annual Meeting of Shareholders to be held April 30, 1947 will be requested by the Management prior to that meeting and it is expected that Notice of Meeting and Proxy Statement will be sent to shareholders about April 4, 1947.

Extracts from 1947 Annual Report

COPPERWELD BRAKE DRUMS

In last year's Annual Report, announcement was made as to the development of a new Copperweld product - copper-covered steel brake drums. Copper has high heat conductivity as well as high electrical conductivity. In the Copperweld brake drum, copper surrounds and is welded to the inner steel braking section of the drum. This copper blanket rapidly absorbs the friction-generated heat from the braking surface. By equalizing the heat around the circumference of the drum, heat distortion is greatly reduced. These properties prevent failures in braking action which occur frequently on heavy duty motor vehicles. Steady progress has been made during 1947 in the further development and testing of these brake drums on heavy, high-speed inter-city buses, trucks and trailers. Also, an extensive field testing project is now under way to determine the performance and life of Copperweld brake drums when used in the rigorous duty encountered on logging trailers used by the lumber industry in the Pacific Nortnwest.

The results of all highway testing programs to date have confirmed the Company's earlier belief that Copperweld brake drums are superior to any others presently in use, both as to operating costs and increased vehicle and passenger safety. Many of the problems concerned with the economical production of Copperweld brake drums were solved during 1947 and by mid-year of 1948, it is expected that this product will be in the stage of pilot production and marketing.

CHANGES IN EXECUTIVE PERSONNEL

DAVID EDWARD WEIR - It is with profound regret that we announce the death, on February 12, 1948, of Mr. Weir. One of the pioneers in the oil production industry, Mr. Weir was elected a member of the Board of Directors of Copperweld in 1932, during the darkest days of the Great Depression. With unswerving loyalty to the Company, but with an equally unswerving holding to his own convictions, he served the interests of the Company well. Every shareholder, every employee, is indebted to Mr. Weir.

CHARLES DREIFUS - Mr. Dreifus was elected to the Board of Directors in 1933. He was one of the most active of the Company directors until ill health forced him to miss many meetings. He gave to Copperweld the benefit of his very large knowledge of industry generally, and, specifically, of certain fundamentals of the steel industry. When his health no longer permitted him to give the time to his duties as a director which he thought should be given, he resigned - February 18, 1948.

THOMAS F. TROXELL - Mr. Troxell, on August 1, 1941, came with Copperweld as its Treasurer and was elected to the Board of Directors shortly thereafter. He had a thorough knowledge of finances gained from many years of experience in the financial field. On July 31, 1943, he resigned his position as Treasurer of Copperweld to return to his chosen field - investment banking and related activities. Claims on his time became so heavy that he was unable to continue an active part in the affairs of Copperweld. He resigned from the directorate and his resignation was accepted December 16, 1947. His fellow directors appreciate the valuable services which Mr. Troxell gave to the Company and hope and believe that his interest in the Company will continue.

FRANK R. S. KAPLAN - Copperweld Steel Company was organized August 16, 1915 and Mr. Kaplan was one of the organizers. He has served the Company continuously from that date and has seen it grow from a company with a $250,000 capitalization and first year's sales of some $200,000 to a company with more than $20,000,000 in total assets and 1947 sales of over $50,000,000. During the more than 30 years that he has been with the Company, he has served continuously as its Secretary and General Counsel. For many years he held the position of Treasurer. On December 16, 1947, Mr. Kaplan was elected First Vice President.

C. WALTER HOLMQUIST -- Mr. Holmquist came with Copperweld in 1932. With a background of experience in the basic steel industry, he became Chief Engineer for the Company's wire and cable plant. Later he became General Superintendent of this plant, in which capacity he served for several years. After the Steel Division was acquired and operating, Mr. Holmquist became increasingly active in its operation, serving in the capacity of Vice President and Assistant to the President on Operations. On August 15, 1947, he was appointed Executive Vice President, in charge of the Steel Division.

OUTLOOK

So far as can be predicted from factors under control of Management, Copperweld's outlook for 1948 is favorable. Both divisions have a large volume of orders to be filled in 1948. Employee relations are highly satisfactory. All indications are that first quarter operations, now nearly completed, will show favorable results.

However, any attempt on the part of Management to predict results for the full year are believed to be unwise. In the case of Copperweld, as with all industry, there are too many factors, presently not determinable, which may arise and which, in substantial degree, would be beyond the control of Management.

By Order of the Board of Directors.

S. E. BRAMER, President.

Glassport, Pennsylvania,
March 21, 1948.

Proxies for the Annual Meeting of Shareholders to be held April 28, 1948 will be requested by the Management prior to that meeting and it is expected that Notice of Meeting and Proxy Statement will be sent to shareholders about April 5, 1948.

Financial Review

EARNINGS

1947 showed a reversal of the downward trend in earnings. Starting from 1941, in which year the Company earned $2.61 per common share, this downward trend continued uninterruptedly through 1946.

Net earnings for 1947, after allowance for dividends on preferred stock, amounted to $1,464,859, equivalent to $2.85 per common share. (The earnings before preferred dividends amounted to $1,546,711). The 1947 earnings compare with 69 cents per common share earned in 1946.

In appraising these earnings, however, four precautions should be observed:

First, recognizing the abnormality of the times and the existing inflation, the Company's Board of Directors took action to appropriate $300,000 from earned surplus to provide a reserve against losses in inventories which must be anticipated when the "break" in the inflationary spiral comes. Because of the gravity of the situation, further reserves will be provided during 1948.

Second, in 1947 only 2.9 per cent of sales ($2.90 per $100 of sales) was realized as net earnings. This contrasts with 4.3 per cent ($4.30 per $100 of sales) realized in 1941 and 1942 and 8.6 per cent in the pre-war years 1935-1939, inclusive. Thus, even in a good year, the margin of profit was very narrow for any business in the heavy or durable goods industry.

Third, common shareholders in 1947 received as dividends less than 8/10 of one cent out of each sales dollar. Furthermore, these dividends were paid in the deflated dollars of today with their reduced purchasing power. 8/10 of one cent from each sales dollar, representing the payment to the owners of the business the cost of using the tools of production -- is entirely too low to attract investment of the savings of individuals. The investment of these savings, providing a constant flow of funds into business enterprise, is essential to the future prosperity of the Country.

Fourth, it must be recognized that the income statement, both with respect to sales and earnings, reflects deflated dollars. Tools - the mechanical equipment which enables the employees to produce at a high level -'do wear out or become obsolete, and must be replaced if the business is to continue. The cost of replacing these tools, which replacement is continuous, is very much higher than the cost at which they were acquired.

In other words, sales and net earnings are stated in terms of deflated dollars, whereas one very important item of cost which produces these sales and earnings - the cost of the tools wearing out or becoming obsolete - is being stated at the value which the dollar represented in years long past. It must be realized that corporations have higher costs which must be met if they are to continue operations the corporations' "higher cost of living" --- just as individuals have higher living, costs.

WORK STOPPAGES

In appraising the earnings of 1947, one further factor should be taken into consideration. After getting off to a good start in January 1947, the wire and cable plant was closed down, or operations were greatly curtailed, from the beginning of February to May 8. This was occasioned, in part, by the gas shortage from which the Pittsburgh industrial district suffered (total 23 working days lost) and, in part, by an unauthorized strike (26 days lost). In addition to these 49 days lost, the plant, on several occasions during this period, was in only partial operation due to shortage of gas.

Thus, the Wire and Cable Division had less than nine months of full operation. No work stoppages occurred in the Steel Division plant.

SALES VOLUME

Sales volume in dollars was very large in 1947 - $53,303,245 against the previous high of $35,396,142 in 1944 and more than double the sales of $25,388,894 made in 1946. Much of this increased dollar volume, however, is attributable to increased costs of certain raw materials which were reflected in increased selling prices.

In the Wire and Cable Division (Glassport, Pennsylvania), for example, the sales prices of the wire and cable products always have been adjusted to reflect changes in the cost of copper. From viewpoint of cost, copper is the most important item of raw material which is used. Purchases of this metal in 1947 were at an average cost of 21.72 cents a pound as compared with 13.86 cents a pound in 1946. This is an increase of 7.86 cents a pound, equivalent to 56.7 per cent. Other items of increased cost, including wage increases which were substantial, were absorbed without increasing selling prices, thus decreasing the margin of profit.

The sales volume of the Wire and Cable Division in tonnage was the second highest in the Company's history, being slightly less (1.66 per cent) than the 1941 volume, which was the largest. However, shipments during the last quarter of 1947 were by far the largest of any equivalent period in the past. This large increase was made possible by the new and improved equipment which was being installed and placed in operation during 1947.

In the Steel Division (Warren, Ohio) the situation was somewhat similar with respect to the dollar sales volume. In this division the most important item of raw material cost is the steel scrap which is used in the electric melting furnaces. The cost of scrap purchased and consumed in 1947 averaged $41.18 a ton as against $24.96 a ton in 1946 an increase of $16.22 a ton, equivalent to 65 per cent. Since selling prices on a substantial part of our orders were adjusted to reflect this increased cost, increased sales dollars were received which were not occasioned by increased tonnage and did not result in increased profit margin. As in the case of the Wire and Cable Division, many other items of increased cost were absorbed without change in selling prices.

Although the total tonnage shipped by the Steel Division during 1947 was the highest in the division's history, any comparison with previous years loses much of its significance due to the material change in the nature of the products manufactured and sold. Until the last quarter of 1946 the business of the division was largely confined to the alloy steel field - characterized by relatively low tonnages sold at relatively high prices.

Because of the critical shortage of carbon steel the Steel Division, in the last quarter of 1946, entered the carbon steel field - characterized by relatively high tonnages sold at relatively low prices. Sales in 1947 were predominantly of carbon steel. Hence, the lack of significance of any comparison with prior years.

Extracts from 1948 Annual Report

PROPOSED JOINT SALE OF STEEL FACILITIES (WARREN, OHIO)

A portion of the Warren, Ohio steel plant consists of facilities owned by the Federal Government (Reconstruction Finance Corporation through the War Assets Administrator) which are operated by the Company under rental agreements. The Company entered into an agreement with the Government whereby the Company's entire Warren steel plant, together with the Reconstruction Finance Corporation facilities, would be offered for sale. At a special meeting of the Company's shareholders held on January 14, 1949, the agreement was approved by an overwhelming vote. Of the 543,744 shares of capital stock, 4_51,_564 shares were voted --- 83 per cent of the total. Of the shares voted, 99 per cent were in favor of the resolution. However, no satisfactory bid was received by the War Assets Administrator, and accordingly no sale was consummated.

IN MEMORIAM

WILLIAM B. KLEE

With profound regret we report the death of Mr. William B. Klee on October 27, 1948. Mr. Klee was elected a member of the Board of Directors of Copperweld in 1934 in which capacity he served continuously until his death. He served the interests of the Company well and his extensive knowledge of industry was of great benefit to Copperweld. We are indeed grateful for having had the services of Mr. Klee.

T. G. COUNCILOR

With deep sorrow we record the death on March 3, 1949 of Mr. T. G. Councilor, Vice President, Director and Controller. Associated with our Company since 1937, he was appointed Controller on June 1, 1938 and shortly thereafter was elected a member of the Board of Directors and became Assistant to the President. In 1941 he was appointed Vice President.

Mr. Councilor was a beloved member of the organization. He will be remembered for his brilliant analytical mind, his devotion to the interests of the Company and his thoughtful consideration of the welfare of all employees.

PERSONNEL

The Management is proud to pay proper tribute to the employees of the Company for their splendid effort and achievement during 1948 which showed new production records being established in both the Steel Division and the Wire and Cable Division. This success could be accomplished only through the loyalty and diligence of all the employees, rank and file, department heads, their assistants, and executives. A fine relationship existed throughout the year with the United Steel Workers of America, C.I.O. There were no work stoppages to interrupt the steady flow of products from our plants.

PROSPECTS

The record breaking operations in both divisions have continued through the first two months of 1949; however, the high volume of production in the Steel Division (Warren, Ohio) is related definitely to the unusual conditions existing in the carbon steel field.

Demand for the products of the Wire and Cable Division (Glassport, Pennsylvania) continues at a high level and capacity operations for the Wire and Cable plant seem probable for the balance of 1949. It would be unwise to predict results for the full year, since, in the case of Copperweld, as with all industry, there are too many factors which may arise and which are beyond the control of Management.

By Order of the Board of Directors.

S. E. BRAMER, President.

Glassport, Pennsylvania,
March 22, 1949.

Proxies for the Annual Meeting of Shareholders to be held April 27, 1949, will be requested by the Management prior to the meeting and it is expected that Notice of Meeting and Proxy Statement will be sent to shareholders about April 1, 1949.

WITH deep sorrow we announce the death on March 24, 1949, of Mr. Samuel Eugene Bramer, our beloved President, Director and General Manager. Mr. Bramer was one of the founders of Copperweld Steel Company in 1915 and was its principal administrative officer since that time. His keen business sense, excellent judgment and leadership contributed immeasurably to the growth and success of the Company. His associates pay tribute to his great human traits-as a man and as a friend --his breadth of vision, his benevolence, and kindly consideration for the welfare of others. The memory of Mr. Bramer's fine character and love for his fellow men will continue to be an inspiration and guiding light to all who knew him.

Extracts from 1953 Annual Report

PRESIDENT'S LETTER TO

Shareholders and Employees

OF COPPERWELD STEEL COMPANY

Copperweld's sales volume in 1953 attained a new record high, exceeding that of 1951, the previous record year. During the latter part of the year the rate of operations at our four manufacturing divisions declined, following the general economic trend of durable goods industries. Because of the lessening of demand in both civilian and Governmental markets, sales volume for the second half of the year was substantially lower than that for the first six months.

Net earnings for the year were the second highest in the Company's history. After deduction for dividends paid to the owners of preferred stock, earnings applicable to the common stock amounted to $5.05 per share of which $2.00 per share was distributed to the owners of the common stock and $3.05 per share was retained in the business to provide funds for the continuing improvement and growth of the Company.

Important changes in the national industrial economy occurred in 1953 when the expanded production capacity caught up with demand, thus terminating the era of material shortages and controlled production induced by emergency conditions. After 14 years of economic controls and an upward spiral of inflation stimulated by war and national defense requirements, industry commenced its adjustment to an economy relatively free from Government control of prices, wages, and materials.

The transition toward a more normal economy has emphasized the importance of keeping abreast of technological improvements in products and manufacturing methods to maintain a competitive position in the markets served. The Company made extensive progress in its plant modernization program to assure production of materials at a reduced cost. The expansion and improvement program inaugurated in 1951 at the Ohio Seamless Tube Division prior to acquisition by Copperweld was substantially completed in January, 1954, when the first tube was run in the new Assel mill.

The acquisition of the Ohio Seamless Tube Mill at Shelby, Ohio and earlier acquisition of the Flexo wire plant at Oswego, New York, were steps toward the Company's objective to diversify further its products and markets as well as to acquire facilities for processing additional tonnage of electric furnace steel produced at the Warren Steel Division.

The adjustment necessary in the industrial economy to meet the return to full competitive conditions has not as yet run its course, thereby precluding an accurate forecast for the entire year 1954. Nevertheless, it is encouraging to note that early indications in the first quarter of 1954 show an upward trend as compared with the latter months of 1953. Barring unforeseeable conditions, this present improvement is expected to continue.

It is with reasoned confidence that we can anticipate a year of satisfactory operations, prepared as we are to provide our customers with better service, improved quality, and a greater range of useful products. The Management looks forward to obtaining a fair share of the markets we serve.

Pittsburgh, Pa.
March 18, 1954.

F. R. S. Kaplan

PRESIDENT

PLANT FACILITIES

The Company operates four manufacturing divisions and a wholly owned subsidiary functioning as an export agency. The manufacturing divisions are:

(1) Steel Division at Warren, Ohio. This plant has an annual rated capacity to produce 618,380 tons of ingots in its 7 electric arc furnaces. Ingots are processed in the form of special high quality alloy and carbon bars and billets - plain hot rolled, forged, annealed, heat-treated, normalized, cold-drawn, machine-turned, and centerless ground, or any desirable combination of these conditions. Rolling and finishing facilities enable this division to furnish rounds, squares, hexagons and octagons in a range of commercial sizes. During 1953, the Steel Division furnished 85 per cent of the steel consumed by the Ohio Seamless Tube Division and all of the steel used by the Wire and Cable Division in the manufacture of Copperweld - copper-covered steel - products. Thus these divisions are assured of a steady source for their basic steel requirements.

(2) Ohio Seamless Tube Division at Shelby, Ohio. This plant has an annual rated capacity of 43,000 tons of seamless carbon and alloy mechanical tubing, seamless mechanical tubing for aircraft uses and forged and fabricated tubing and 8,400 tons of electric resistant welded steel tubing.

(3) Wire and Cable Division at Glassport, Pennsylvania. This plant has an annual rated capacity of 55,000 tons of Copperweld (copper-covered steel) rods, wire, strand, Copperweld-copper conductors and other wire mill products, which combine the electrical conductivity and corrosion resistance of copper with the mechanical strength and durability of steel. The Copperweld ingot is made by the molten welding of copper and steel, a process exclusive with this Company. The Copperweld ingot is hot rolled to a rod, which in turn is cold-drawn to the desired wire sizes, maintaining a uniform relative thickness of the copper exterior to the steel core. The newly developed Copperweld brake drum is also produced at this plant.

(4) Flexo Fine Wire Division at Oswego, New York. This plant has an annual capacity to produce 6,000,000 pounds of flexible cables, fine wire and fine wire products. This division has facilities for wire drawing, stranding, braiding, bunching, annealing and tinning of products for use in the electrical and electronic industries. Copper and bronze wire as well as Copperweld wire and cable are produced in many sizes and types.

The Copperweld Steel International Company, a wholly owned subsidiary, organized in 1944, has 15 foreign fabricators and 51 exclusive sales representatives throughout the world developing foreign markets for the products of the Wire and Cable Division. In 1953, export shipments of wire and cable products were made to 64 foreign countries and reached a new all-time high of 17 per cent of the total shipments of the Wire and Cable Division. Currently, this subsidiary is expanding its activities in foreign markets to promote the sale of steel, tubing and fine wire products produced at the Company's other manufacturing divisions.

Extracts from 1955 Annual Report

Review of Operations of the Wire and Cable Division

The Wire and Cable Division located at Glassport, Pennsylvania, constituted the entire operation of the Company from its inception in 1915 to June, 1940, when the newly constructed Steel plant at Warren, Ohio, produced its first ingot. The annual capacity of this Division is approximately 55,000 tons of copper-covered steel rod and wire used singly or stranded in cable form or stranded with solid copper wire to form composite cable. The portion of the Modernization and Expansion Program applicable to this Division is estimated to cost $1,100,000 and consists principally of improvements in the rolling mill department which will make possible lower processing and handling costs of copper-covered steel billets. The efficiency of the heat treating, wire drawing, and testing operations will also be improved. The Program is expected to be completed during the second half of 1956, with the anticipated benefits being realized shortly thereafter.

Net sales of the Wire and Cable Division for 1955 aggregated $23,285,000, including interdivisional sales to the Flexo Fine Wire Division, an increase of 22 per cent over 1954. Approximately 23 per cent of the sales of this division were sold through the Copperweld Steel International Company - a wholly owned subsidiary - for shipment to foreign countries.

The unprecedented world-wide demand for copper, combined with industry-wide strikes in the principal copper-producing countries - Chile, Rhodesia, and the United States - created a tight world supply situation which is continuing into 1956.

As the amount of copper produced in the United States is insufficient to meet domestic consumption, many fabricators are dependent upon foreign copper to maintain operations. This situation was further aggravated in 1955 by higher prices being paid for copper in foreign countries which directed the flow of available copper away from the United States. A more favorable outlook for expanded production in 1956 is expected to contribute to a better relationship between supply and demand.

The primary producers' price of copper increased steadily throughout 1955, from 30 cents per pound at the beginning of the year to 43 cents per pound at the close of the year. As the copper available from primary producers was insufficient to satisfy the demand, it was necessary to purchase a quantity of copper from secondary domestic producers and from foreign sources at varying prices up to 52 cents per pound. Generally, the Company follows the practice of relating its selling prices of wire and cable products to the primary producers' market prices of copper in effect at the time of shipment of products to its customers.

Extracts from 1957 Annual Report

COPPERWELD STEEL COMPANY

Board of Directors

Henry G.,Riter, 3rd
Honorary Chairman
James M. Darbaker
President
Carl I. Collins
William W. Ege
Lee B. Foster
C. Walter Holmquist
Irving M. J. Kaplan
Joseph W. Kennedy, Jr.
Livingston B. Keplinger
John H. Lucas
William B. McFall
Meyer B. Mervis
Charles A. Taylor
Clyde M. Whittaker
Executive Committee
Lee B. Foster
Chairman
Livingston B. Keplinger
Vice Chairman
James M. Darbaker
John H. Lucas
Meyer B. Mervis
Henry G. Riter, 3rd

Officers

James M. Darbaker
Carl I. Collins
William W. Ege
Lee B. Foster
C. Walter Holmquist
Irving M. J. Kaplan
Joseph W. Kennedy, Jr
Meyer B. Mervis
Charles A. Taylor
Phillip A. Terrell
Paul Van Wagner
Maurice J. Mahoney
William E. Cooper
William J. Davis, Jr.
David Ferguson
Richard P. Fierst
John Hoak
Merle Hoffman
Norman F. Yount
President and Chief Executive Officer
Vice President - In Charge of Superior Steel Division
Vice President - In Charge of Wire and Cable Division
Vice President
Executive Vice President - In Charge of Aristoloy Steel Division
Vice President
Vice President - In Charge of Ohio Seamless Tube Division
Vice President
Vice President, Treasurer and Controller
Vice President
Vice President
Secretary
Assistant Secretary and Division Controller
Assistant Treasurer
Assistant Controller
Assistant Treasurer
Assistant Treasurer
Assistant Secretary and Division Controller
Assistant Secretary and Division Controller


TO THE SHAREHOLDERS AND EMPLOYEES OF COPPERWELD STEEL COMPANY

The year 1957 was one of great significance, highlighted by the substantial completion late in the year of the modernization and expansion program started in 1955 and the merger with the Superior Steel Corporation on November 30, 1957. With the new facilities in operation, Copperweld can produce the stainless, alloy, and high carbon steel billets and slabs required by its newly acquired Superior Steel Division for the production of hot rolled and cold rolled strip steel and special products. The manufacturing facilities of Superior complement those of Copperweld and will create a more integrated operation as well as greater diversification of products.

Copperweld's sales volume for 1957 declined from the record volume of the previous year, reflecting the downward trend in evidence throughout the Steel industry during the latter part of the year. The decline resulted mainly from customer inventory liquidation and from curtailment of Government defense expenditures. Earnings for the year were lower in part because of the reduced sales volume and the extraordinary costs incurred during the breaking-in of extensive new facilities. Production difficulties, common to the starting-up of new facilities, delayed the realization of a substantial portion of the benefits anticipated from the expansion program. This situation is being overcome as personnel becomes more proficient in the operation and maintenance of the new equipment.

A continuous program of engineering and metallurgical research is being conducted at each of the Company's divisions. Progress has been made in the development of an aluminum-covered steel rod which can be redrawn into wire. It is expected that this product will be introduced to the trade on a commercial basis during the current year. In a research program begun during 1957, the feasibility of using direct-reduced iron ore in the metallic charge for the electric melting furnaces is being studied. The Company's metallurgists and engineers are continuing their experiments with new alloys and new techniques in the manufacture of steel tubing. At the Superior Steel Division efforts are being directed toward increased participation in the growing field of special materials such as boron stainless, zirconium, zircaloy and beryllium copper.

We feel confident that we are now in a more favorable position to take advantage of any improvement in general industrial activity. It is a pleasure to welcome into Copperweld's growing family the former Superior shareholders acquiring Copperweld stock through the merger and to acknowledge the continued support and confidence of all shareholders and employees of the Company.

J. M. Darbaker

President

February 26, 1958

During the the 1950s, Copperweld was in a period of expansion. All of the acquisitions of this expansion were outside of Glassport. The Glassport plant was becoming less important to Copperweld as a whole. This trend was not only true of Copperweld, but in all of the major corporations in the Pittsburgh area. In hindsight, these changes were laying the ground work for the death of the Glassport plant in the 1980s.

To establish its own source of steel, the Steel Division was established in Warren, Ohio in 1940. In 1951, the markets for wire product were broadend through the acquisition of a plant at Oswego, NY, later to be known as the Flexo Fine Wire Division. In 1952, the company acquired facilities at Shelby, Ohio, known as the Ohio Seamless Tube Division. The executive offices were moved from Glassport to Pittsburgh.

In 1959, Alumoweld (R) (aluminum-covered steel) wire and strand became the second bimetallic product line manufactured by Copperweld's Wire and Cable Division in Glassport. Produced through a powder metallurgy process, the Alumoweld product met a growing need in the electric power industry for another strong, corrosion resistant material for both electrical and mechanical applications. Copperweld Steel Company, in recognition of its new corporate nature, changed its name in 1973 to Copperweld Corporation. At the same time, the Wire and Cable Division in Glassport became Copperweld Bimetallics Division, a name which also more accurately reflects its expanded manufacturing capabilities.

The corporation is now a diversified manufacturer of specialty metal products, including specialty tubing, alloy steels, and bimetallic rod, wire and strand.

One of the significant reasons for the Company's progress in recent years has been the development of foreign markets. The Company's sales activities outside the United States are conducted by Copperweld Industries International, Inc., a wholly-owned subsidiary of Copperweld Corporation. As a result of these sales efforts, Copperweld and Alumoweld bimetallic wire products, made in Glassport by many Glassporters, are used in industrialized and developing countries around the world.

Extracts from 1963 Annual Report

WIRE AND CABLE DIVISION

This division, located at Glassport, Pennsylvania, manufactures and sells copper-covered steel wire, rod and strand under the trade name "Copperweld," and aluminum-covered steel rod, wire and strand under the trade name "Alumoweld." The present annual capacity of the plant is approximately 40,000 net tons of "Copperweld" and 18,000 net tons of "Alumoweld."

"Copperweld" is made by pouring molten copper around a heated steel billet under such controlled conditions as to effect a weld between the copper and the steel. The billet is then hot-rolled into rod and cold drawn into wire. "Alumoweld" is made by a controlled atomic-weld process with the use of powdered aluminum.

A significant portion of the output of this division is exported to foreign customers as a result of the marketing activities of Copperweld Steel International Company.

Net sales of this division, excluding sales to the Flexo Wire Division, were approximately 25 percent of the Company's net sales for 1963 and were 8 percent higher than in 1962. The improvement in sales was due primarily to the 15 percent increase in shipment of Alumoweld wire and strand as compared with the preceding year. In both domestic and foreign markets, this division continues to experience aggressive competition from other products. In addition, constantly increasing labor costs have intensified the cost-price squeeze. However, a small increase in selling prices in October, 1963, is expected to improve the profit margin.

On October 15, 1963, an agreement with the United Steelworkers of America was executed at this division which provided for additional vacations, increased pensions and group insurance benefits. These benefits were in lieu of the steel industry's 13-week Extended Vacation Plan which would have been very difficult to administer in this fabricating plant. The Savings and Vacation Plan agreement previously executed on July 1, 1962, was eliminated and terminated. The agreement with respect to vacations, pensions and insurance will continue in effect without change to January 13, 1969. The Agreement also provided for reopening on other issues on or after January 9, 1967.

On August 3, 1963, a tornado-like storm struck this plant causing physical property damage in excess of one million dollars. Fortunately the plant was shut down for its annual three-week summer vacation period and no company employees were injured. Property repairs were rushed to permit the plant to resume operations following the vacation period with practically no loss of production. Insurance coverage was adequate to cover the damage.

Extracts from 1967 Annual Report

Management's Letter to the Shareholders

For Copperweld, the year 1967 can be best characterized as a year of adjustment and transition.

Factors beyond the Company's control significantly affected sales and earnings in 1967. During the first half of the year, inventory liquidation in the durable goods sector of the economy affected shipments of steel products. Work stoppages in customers' plants, the prolonged strike of the steel haulers, and the extended strike in the domestic copper industry all affected the Company's operations during the second half.

In 1967, the Ohio Seamless Tube Division established new records in sales and earnings for the second consecutive year, confirming the continuing growth in demand for the Company's steel tubing and tubing products. At the Aristoloy Steel Division, difficulties in bringing new facilities up to design levels of production were to a significant degree resolved in 1967 and the operating rates and sales and earnings performance attained in the fourth quarter reflect the substantial progress that has been made at that division. Both the Ohio Seamless Tube and Aristoloy Steel Divisions experienced unauthorized work stoppages. As mentioned earlier, the prolonged strike in the domestic copper industry materially affected the Wire and Cable Division and to a lesser extent, the Flexo Wire Division.

Notwithstanding these unfavorable influences, the Company's sales declined less than four percent from 1966 levels. Net earnings for the year 1967 were 33 percent lower than those of the prior year, reflecting reduced sales volume, increases in production costs and a lower investment credit.

The broad problems which the economy currently faces obscure the outlook for 1968. Developments in international affairs, action to be taken by the Congress on the proposed income tax increase, and fiscal and credit policies that may be followed by the Federal government will be of considerable importance.

Also, collective bargaining agreements will be negotiated in a number of major industries, including the steel industry. There is an increasing awareness of the problems created by an uncertain labor situation-problems which have a longterm effect upon all parties involved in the collective bargaining process. It is to be hoped, therefore, that agreements will be reached promptly and without suspension of operations and further, that such agreements will recognize that increases in employment costs in the absence of compensating increases in productivity result in higher labor costs per unit of production which ultimately work to the disadvantage of all.

Copperweld is looking forward to significant improvement in 1968 over 1967. The Company's steel and tube producing plants are expected to operate at high levels during the first half of the year, in part, in response to inventory accumulation stimulated by the possibility of a strike in the steel industry. After agreements have been reached, operations may be affected by customers' inventory liquidation policies. The Company's wire and strand producing plants expect demand for their products to increase after the labor situation in the domestic copper producing industry has been resolved and a stable supply of copper is assured. Aggressive cost control programs at all divisions are being continued to protect profit margins.

1968 presents challenges and opportunities. With the continued support of shareholders, customers, suppliers, and employees, Copperweld is confident of its ability to meet challenge successfully and to make the most of opportunity.

C. A. Taylor
Chairman of the Board
P. H. Smith
President
February 12, 1968

Report on Operations

...Operations at the Wire and Cable Division declined from the prior year's level, due primarily to lower shipments of the division's "Copperweld"-copper- covered steel wire and strand. Contributing to this decline was the strike in the domestic plants of primary copper producers which began in July 1967 and continued into 1968. In addition, the Federal government, aware of the need to conserve the supply of copper, has requested governmental agencies to substitute other materials for copper where possible. This policy together with the price structure and the uncertainty of supply have caused some customers to defer construction of projects on which "Copperweld" wire and strand would have been used.

Sales of "Alumoweld"-aluminumcovered steel wire and strand-also were affected by reduced construction activity. However, customer acceptance of "Alumoweld" and AWAC-"Alumoweld" stranded with one or more aluminum wires-continues to grow and the backlog of orders for future shipment of these products was at a very high level, exceeding that of the prior year-end. "Alumoweld" has proven very successful in use as overhead ground wire, guy and messenger strand, and telephone and signal line wire. AWAC is a composite power conductor that is highly regarded by engineers and line designers because of its unique strength-toweight characteristics, its conductance and excellent corrosion resistance.

Since being first introduced to the market, aluminum-covered products have each year accounted for an increasingly larger portion of the total shipments of this division. In 1967, on a weight basis, shipments of "Alumoweld" and AWAC represented in excess of 40 percent of the division's shipments. Earnings at the Wire and Cable Division in 1967 were sharply lower than in 1966, largely as a result of lower operating levels and higher employment costs that became effective during the year under the current bargaining agreement.

Extracts from 1970 Annual Report

President's Message to Shareholders

1970 proved to be one of the most interesting and challenging business years Copperweld has faced in the past decade. The Company experienced the worst of two worlds-continuing rises in the costs of purchased goods and services, and an economic recession affecting the markets served by its operating Divisions.

Sales volume for the year declined 8% from the prior year. Net earnings for the year, before extraordinary charges to income, were $1.51 per share, down from $2.03 per share before nonrecurring income in 1969. The First Half of 1970 was characterized by good business levels, although raw material prices, and a severe trucking industry strike adversely affected earnings. In the Third and Fourth Quarters, however, the effect of an economic recession, and the strike against General Motors severely affected sales and earnings. During this period, the Company took firm cost reduction steps and the earnings performance in the Fourth Quarter showed marked improvement. The year ended on a firm note.

Throughout the year, the Company carefully monitored its working capital and liquidity position, with the result that working capital at year-end stood at $32,492,147, the highest level in the Company's history. Because of the Company's Third Quarter loss, and the business and economic uncertainties prevailing in the Fourth Quarter, the Board of Directors reduced the dividend rate for the Fourth Quarter to 15¢ per share. In January 1971, at the quarterly dividend meeting of the Board, the Directors of the Company authorized an increase of the dividend to 25¢ per share.

At the end of 1970, the Company wrote off the 14" Rolling Mill purchased from the Ford Motor Company in 1964. The applicability of this Mill, which had not been installed, but is in storage condition, was carefully studied by management and consulting Rolling Mill experts throughout the year, and on the basis of the joint recommendation, the unit was written off. Similarly, the Kocks Mill at the Steel Bar Division was written off at yearend following a careful study of its operating cost and product profit factors. The write-off of these two units resulted in a non-recurring charge to income of $.65 per share in 1970. Throughout all four Divisions, management is eliminating unprofitable products and operations so that the Company's future sales volume will be more profitable.

In the Third Quarter of 1970, the Company completed and brought into production the thermal treating and bar-finishing complex at the Steel Bar Division. These units, the most modern in the United States today, will provide the availability of more profitable product lines for the Division.

The cost of raw materials moderated slightly during the year 1970. By the end of the Second Quarter, the Company was able to secure adequate nickel for its needs in alloy steel production. Copper costs, which were high during the First Half, moderated sharply during the Third and Fourth Quarters, and are now at the lowest levels in two years. Ferrous scrap, while peaking during the year, moderated towards year end, but still remains appreciably above levels experienced in 1967-68.

The Japan Alumoweld Company, "JAC", in which the Company holds a 45% interest, enjoyed an excellent year of sales and earnings, and established another record year. Throughout 1970, Copperweld dividends from JAC, and its royalty earnings, were included in the consolidated financial reports.

During 1970, the Company took steps to strengthen its management group. D. H. Deichmann joined the Company as Vice President of Finance. G. S. Parker was appointed Vice President and General Manager of the Copperweld Steel International Company. Bennett Sack was appointed Vice President of Operations of the Steel Bar Division. Norman F. Yount, Vice President and General Manager of the Wire & Cable Division, and President of the Copperweld Steel International Company, was elected to the Board in April. Also, Glen J. Hartman, Vice President and General Manager of the Ohio Steel Tube Division was elected to the Board in June, filling the vacancy caused by Arthur L. Wadsworth's untimely death.

The Company's capital spending plans slowed in late 1970, after completion of the thermal treating plant at Warren. Plans are being readied for an expansion at the Ohio Steel Tube Division, both for heavy wall welded tubing in larger diameter than presently produced, and stainless welded tubing. These plans, in addition to internal plant relocation and modernization, will predominate the Company's spending during 1971.

As the year 1971 begins, the business outlook at all operating Divisions is improving, and it appears 1971 will see an improvement in sales and earnings, due partially to steel stockpiling in the First Half. With continued emphasis on cost reduction and profit improvement, the Company is looking forward to a restoration of earlier profitability levels.

To our Shareholders, to my fellow Copperweld employees, and the Board of Directors, I express my appreciation for your support during the entire year of 1970.

Phillip H. Smith President


Wire and Cable Division Operations

The year 1970 showed continuing improvement in operations effectiveness at the Wire and Cable Division in Glassport, Pennsylvania. This Division, which produces and markets copperclad and aluminum-clad steel rod, wire, and strand under the tradenames of Copperweld and Alumoweld, experienced a reduced demand for its products during the year. This decline in demand reflected the lower level of activity in the economy in general and the high cost of money that prevailed during most of the year.

Although the volume of shipments in 1970 was about 5% lower than in 1969, net sales increased by 5% over the prior year. Selling prices were increased generally in February 1970 in response to known increases in costs and revised on a selective basis during the year as the price of copper from primary producers was changed.

Profit margins at the Division were improved during 1970 despite continuing increases in employment and other costs, including raw materials, operating supplies, and outside services. Consistent with provisions of existing collective bargaining agreements, wages and salaries for bargaining employees were increased on August 1, 1970. Improved group insurance benefits also became effective on that same date. Contributing to better profit were cost reductions effected by revised operating practices and facility improvements.

Further progress was made during 1970 on the design of water anti-pollution equipment. The planning studies for this project are under review by the appropriate State authorities and the current schedule provides for completion by the end of 1971. No air pollution problem exists at the Wire and Cable Division inasmuch as discharges into the atmosphere are well below limits permitted under existing regulations.

The outlook for 1971 is encouraging. Expansionistic economic policies espoused by the Federal government, significant reductions in interest rates, and the increasingly optimistic tone evidenced in important sectors of the economy are all factors favorable to the outlook for the markets served by the Division. However, the year will not be without challenges. Collective bargaining agreements expire in November 1971 (or later if there should be a strike in the steel industry) and public news media indicates that demands will be made by the Unions for substantial increases in rates of pay and increasingly costly benefit programs. It is expected that costs of other services, raw materials, and operating supplies will also continue to increase. Profit margins so essential to the future growth of the Division can only be maintained through a combination of higher selling prices-which involves the risk of unfavorable customer reactions-and by continuation and intensification of cost reduction programs which proved to be effective in 1970.

Copperweld Corporation's reputation for good management, made world news for Glassport on August 29, 1976, when it was announced that a foreign firm had indicated a desire to discuss the possibility of making an offer for all of the outstanding shares of Copperweld Corporation stock As a result of this disclosure, the Securities and Exchange Commission temporarily halted trading in Copperweld stock.

On September 2, 1975, the name of the company was revealed as Societe Imetal, a foreign holding company based in Paris, France, owned by the Rothschild family.

Glassport made front page news also in the September issue of the Wall Street Journal with the headlines - "Baron de Rothschild Kindly Rejects Offer to Visit Glassport, Pa. His Bid for Copperweld Stirs A Franco-American Storm." The story continued, "Baron Guy de Rothschild, 1 Rue de Courcelles, Paris is kindly invited to appear in the fire halls Reliance Hose Co. No. 2 Glassport at 10 o'clock in the morning. Also invited were the Subcommittee on Labor Standards for a congressional hearing on the proposed take-over by the French company. In responding to the invitation, Mr. Rothschild, the French financier graciously declined because he did not receive the invitation in sufficient time, but added that he would be pleased to discuss an appropriate time and place for his testimony." (He later came to Pittsburgh for this meeting).

The Wall Street Journal noted it was rather original, inviting a Paris Rothschild to a grimy Pittsburgh-area factory town for a hearing in a fire station.

The members of the House of Representatives of the Congress of the United States who attended this public hearing, a first for Glassport, on Friday, September 12, 1975 at 10:00 a.m. in the Reliance Hose Co. No. 2 were: The Honorable John H. Dent, Chairman of the Subcommittee, The Honorable Joseph Gaydos, The Honorable John P. Martha, The Honorable H. John Heinz III, The Honorable Charles J. Carney. Also attending were Phillip H. Smith, President and Chairman of Copperweld Corporation, representatives of the United Steel Workers Union, local officials and employees of Copperweld along with interested members of the community.

About 300 devoted Copperwelders from the Bimetallics Division were given a community sendoff early in September when they traveled overnight by bus to New York to demonstrate in Rockefeller Center against the take-over by the French company. While Copperweld through employee demonstrations and legal action, evidenced a fierce determination to keep the Company independent, Imetal was successful in acquiring 69 percent of Copperweld's shares through its tender

In the 1975 annual report of the Copperweld Corporation, the management reports that the outlook for Copperweld and the future, which affects Glassport's future, also, is that Imetal's investment will be beneficial to Copperweld's growth and profitability in the future. A very encouraging fact is that after the conclusion of the Imetal tender offer Copperweld still has some 5,300 investors who own Copperweld shares, many of whom are Copperweld employees and many of whom also are "Glassporters" who long ago had faith in the idea that was born in 1915 in the minds of those five American men.

The company no longer has a site in Glassport.


Page last updated February 27, 2003