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United States
Securities and Exchange Commission
Washington, D.C. 20549

Form 10-Q

Commission File No. 0-13787

INTERMET Corporation
(Exact name of registrant as specified in its charter)

(248) 952-2500
(Registrant’s telephone number, including area code)

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

At November 8, 2002 there were 25,491,178 shares of common stock, $0.10 par value, outstanding.

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INDEX

INTERMET Corporation

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Part I — Financial Information

Item 1. Financial Statements

INTERMET Corporation

Interim Condensed Consolidated Statements of Income
(Unaudited)
(in thousands of dollars, except for per share data)

See accompanying notes.

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INTERMET Corporation

Interim Condensed Consolidated Balance Sheets

See accompanying notes.

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INTERMET Corporation

Interim Condensed Consolidated Balance Sheets

See accompanying notes.

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INTERMET Corporation

Interim Condensed Consolidated Statements of Cash Flows

See accompanying notes.

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INTERMET Corporation

Notes to Interim Condensed Consolidated Financial Statements

September 30, 2002 (Unaudited)

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine-month period ended September 30, 2002 are not necessarily indicative of the results that may be expected for the year ending December 31, 2002.

The balance sheet at December 31, 2001 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. Refer to our 2001 Annual Report and 10-K filing for complete financial statement and footnotes.

The data provided for the three and nine months ended September 30, 2001 vary from amounts previously reported on the INTERMET Form 10-Q for the quarter ended September 30, 2001. See note 13 to the audited financial statements contained in the INTERMET Form 10-K for the year ended December 31, 2001 for a reconciliation of the amounts given with those previously reported.

For further information, refer to the consolidated financial statements and footnotes thereto included in the INTERMET annual report on Form 10-K for the year ended December 31, 2001.

In April 2002, Statement of Financial Accounting Standards (“SFAS”) No. 145, “Rescission of FASB Statement 4, 44 and 64, Amendment of FASB Statement No. 13 and Technical Corrections,” was issued. For most companies, SFAS 145 will require gains and losses associated with the extinguishment of debt be classified as income or loss from continuing operations rather than as extraordinary items. We will be required to adopt SFAS 145 on January 1, 2003. Upon adoption, any gain or loss on extinguishment of debt previously classified as an extraordinary item in prior periods presented that does not meet the criteria for such classification will be reclassified to a component of continuing operations.

In June 2002, SFAS 146, “Accounting for Costs Associated with Exit or Disposal Activities,” was issued, which supersedes Emerging Issues Task Force Issue No. 94-3, “Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring).” SFAS 146 requires companies to recognize costs associated with exit or disposal activities when they are incurred rather than at the date of a commitment to an exit or disposal plan. In addition, SFAS 146 establishes that fair value is the objective for initial measurement of the liability. SFAS 146 will be effective for exit or disposal activities initiated after December 31, 2002.

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INTERMET Corporation

Notes to Interim Condensed Consolidated Financial Statements

September 30, 2002 (Unaudited)

2. Inventories

Net inventories consist of the following (in thousands of dollars):

3. Property, Plant and Equipment

Gross property, plant and equipment consist of the following (in thousands of dollars):

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INTERMET Corporation

Notes to Interim Condensed Consolidated Financial Statements (continued)

September 30, 2002 (Unaudited)

4. Adoption of Accounting Policy

We have goodwill consisting of costs in excess of net assets acquired of $217.0 million, which is net of accumulated amortization of $21.9 million at both September 30, 2002 and December 31, 2001. On January 1, 2002, we adopted SFAS 142, “Goodwill and Other Intangible Assets.” Under this statement, goodwill is no longer amortized but is subject to annual impairment tests (or more frequent tests if impairment indicators arise). As required under SFAS 142, we wrote off negative goodwill of $481,000, net of taxes, in the first quarter of 2002 as a cumulative effect of a change in accounting principle. In addition, we performed impairment tests of our goodwill as required and determined that no impairment of the goodwill existed at the effective date of adoption.

The following table is presented as if goodwill was no longer amortized as of January 1, 2001 (in thousands of dollars, except per share data):

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INTERMET Corporation

Notes to Interim Condensed Consolidated Financial Statements (continued)

September 30, 2002 (Unaudited)

5. Debt

In July of 2001 we entered into an agreement with our banks providing for a new term loan facility for $182.8 million, replacing an existing $200 million term loan and a $15 million unsecured note. At the same time, we renegotiated certain terms of our existing $300 million revolving credit facility. The interest rate on our revolving credit facility is currently LIBOR plus 3.00% (as of September 30, 2002 the rate was approximately 4.80%). The revolving credit facility expires in November, 2004.

On June 13, 2002, we completed a senior note offering of $175 million. The notes bear a fixed rate of interest at 9.75% and will mature on June 15, 2009. Interest is due June 15 and December 15, commencing December 15, 2002. The notes are unsecured and rank equally with all of our existing and future unsecured senior debt. The net proceeds of the senior note offering were used to pay the remaining balance on the bank term loan ($161.7 million) and for working capital purposes. Debt issuance costs of $5.9 million capitalized in connection with the debt offering are included in “other noncurrent assets” in the accompanying balance sheet and are being amortized over seven years. See note 12 for additional information regarding the senior unsecured notes.

Long term debt consists of the following (in thousands of dollars):

Maturities of long-term debt at September 30, 2002 and for each twelve-month period thereafter are as follows (in thousands of dollars):

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INTERMET Corporation

Notes to Interim Condensed Consolidated Financial Statements (continued)

September 30, 2002 (Unaudited)

6. Derivative Financial Instruments

We enter into various derivative transactions pursuant to our risk management policies. We do not use derivative financial instruments for trading purposes.

We have an interest rate swap agreement with notional amount of $50 million to manage our exposure to the interest rate risk associated with our debt. We have designated this swap transaction as a cash flow hedge. This hedge is considered to be perfectly effective. Therefore, the entire change in the fair value of the swap agreement has been recognized in Other Comprehensive Income, and no hedge ineffectiveness is recorded in earnings.

In addition, we have foreign currency forward contracts to hedge our exposure to Euro denominated loans from our European operation. We have designated these forward contracts as fair value hedges. At September 30, 2002, the face value of these foreign currency forward contracts was $12.2 million. The change in the fair value of such contracts was not material to our financial statements.

7. Comprehensive Income

Total comprehensive income consisted of the following (in thousands of dollars):

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INTERMET Corporation

Notes to Interim Condensed Consolidated Financial Statements (continued)

September 30, 2002 (Unaudited)

8. Reporting for Business Segments

We evaluate the operating performance of our business units individually. Under the provisions of SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information,” we have aggregated operating segments that have similar characteristics, including manufacturing processes and raw materials. The ferrous-metals segment consists of ferrous foundry operations and their related machining operations. The light-metals segment consists of aluminum, magnesium and zinc casting operations and their related machining operations. Corporate and other consists of operations that do not fall within the ferrous-metals or light-metals segments and has been combined with the corporate business unit and its related expenses and eliminations. This information is displayed in the following table:

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INTERMET Corporation

Notes to Interim Condensed Consolidated Financial Statements (continued)

September 30, 2002 (Unaudited)

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INTERMET Corporation

Notes to Interim Condensed Consolidated Financial Statements (continued)

September 30, 2002 (Unaudited)

9. Environmental and Legal Matters

On March 14, 2002, we entered into a Consent Order with the U.S. Environmental Protection Agency (“USEPA”), which will require investigation of the nature and extent of any hazardous waste disposed of at our Radford, Virginia facilities. We have entered into this Consent Order in connection with the USEPA’s Corrective Action Program. The Corrective Action Program is being undertaken on a nationwide basis by USEPA pursuant to the Resource Conservation and Recovery Act of 1976. The Corrective Action Program requires facilities that have historically generated or handled hazardous waste to determine whether those activities have or could adversely affect groundwater or adversely affect human health. We are in the early stages of this investigation. Because we historically disposed of waste material at this site, it is possible that fines or penalties could be assessed, or that remedial action could be required, with respect to that on-site disposal. At this time we cannot predict the amount of potential fines or penalties or the cost of remedial action, if any.

On March 5, 2000 we suffered a catastrophic accidental explosion and fire at our New River Foundry, located in Radford, Virginia. Three employees were fatally injured and others were injured, several seriously. On March 2, 2002 the representatives of the three deceased employees, and three of the injured employees, filed lawsuits seeking damages from us and others in the Circuit Court for the City of Radford, Virginia. It is also possible that one or more of the other defendants in these cases might assert cross-claims against us. We intend to defend these lawsuits on the ground that, among other things, the claims asserted against us are barred by the laws of Virginia governing workers compensation. We have both primary and excess liability insurance policies covering potential liability to employees and others and believe that we are adequately insured against any likely liability for the deaths or injuries arising out of this incident. However, if we were held to be liable in these cases, and if our insurance policies did not provide coverage for the damages, the amounts that could be incurred could be material.

We are also a party to a number of other legal proceedings in the ordinary course of business. We do not believe that such other pending or threatened legal proceedings to which we are a party, or to which any of our property is subject, will have a material adverse effect on our consolidated financial position, results of operations or liquidity taken as a whole.

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INTERMET Corporation

Notes to Interim Condensed Consolidated Financial Statements (continued)