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SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-K

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE  SECURITIES EXCHANGE ACT OF 1934

AMCAST INDUSTRIAL CORPORATION

(Exact name of registrant as specified in its charter)

(937) 291-7000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act:

Common Shares, without par value

Preferred Share Purchase Rights

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in the definitive proxy or in information statements incorporated by reference in Part III of this Form 10K or any amendment to this Form 10-K.    x

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).    Yes  ¨    No  x

Aggregate market value of common shares, no par value, held by non-affiliates of the registrant (assuming only for the purposes of this computation that directors and officers may be affiliates) as of March 2, 2003—$12,967,626.

Number of common shares outstanding, no par value, as of September 28, 2003—9,264,234 shares.

Documents Incorporated by Reference

Part III—Portions of Proxy Statement for the Annual Meeting of Shareholders to be held on December 17, 2003, definitive copies of which will be filed with the Commission within 120 days of the Company’s fiscal year end.

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AMCAST INDUSTRIAL CORPORATION

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PART I

ITEM 1—BUSINESS

Amcast Industrial Corporation, an Ohio corporation incorporated in 1869, and its subsidiaries (called collectively Amcast or the Company) are engaged in the business of manufacturing technology-intensive metal products in a variety of shapes, sizes, and metals for sale to end users, distributor and wholesaler organizations, and original equipment manufacturers and suppliers. The Company serves three major sectors of the economy: automotive, construction, and industrial. Manufacturing facilities are located in the United States of America, primarily in the Midwest.

The Company operates in two business segments – (1) Flow Control Products, a leading supplier of copper and brass fittings for the industrial, commercial, and residential construction markets, and (2) Engineered Components, a leading supplier of aluminum wheels and aluminum components for automotive original equipment manufacturers. Information concerning the net sales, operating profit, and identifiable assets of each segment and sales by product category for years 2001 through 2003 appears under “Business Segments” in the Notes to Consolidated Financial Statements.

STRATEGIC ACQUISITIONS AND DIVESTITURES

During 2003, the Company sold all the capital stock of its wholly-owned subsidiary, ASW International II, B.V., which owned all of the stock of Speedline S.r.l. (Speedline), to Crown Executive Aviation Limited, a private company organized under the laws of the United Kingdom. Principal products manufactured by Speedline, which was originally purchased by the Company in 1997, include aluminum wheels for passenger cars and trucks, as well as aluminum and magnesium racing wheels, aftermarket wheels, modular wheels, and hubcaps. Unless otherwise indicated, all financial information included in this Report presents the results of Speedline as a discontinued operation.

During 2001, the Company purchased the remaining 40% share in Casting Technology Company (CTC), from Izumi Industries, LTD, bringing Amcast’s total ownership to 100%. The acquisition of the Izumi partnership interest in CTC enabled the Company to continue to use proprietary squeeze casting technology in the production of aluminum vehicle suspension components.

FLOW CONTROL PRODUCTS

The Flow Control Products segment (Flow Control) includes the businesses of Elkhart Plumbing (Elkhart), Elkhart Industrial (Geneva), Lee Brass Company (Lee Brass), and Amcast Industrial Ltd. Elkhart produces a complete line of wrot copper fittings for use in residential, commercial, and industrial construction and markets brass pipe fittings and cast and fabricated metal products for sale to original equipment manufacturers in the transportation, construction, air conditioning and refrigeration industries. Geneva fabricates custom copper and aluminum tubular parts. Lee Brass manufactures cast brass products for residential, commercial, industrial, and marine plumbing systems as well as specific cast brass components unique to the application of original equipment manufacturers. Amcast Industrial Ltd. is the Canadian marketing channel for the Company’s Flow Control segment manufacturing units.

The Flow Control Products segment is one of three major suppliers of copper fittings to the North American industrial, commercial, and residential plumbing markets as well as a leading supplier of copper and brass fittings for the industrial, commercial, and residential construction markets. Products are sold through wholesalers, distributors, retail hardware stores and home centers, and to original equipment manufacturers and replacement parts distributors in the air conditioning and commercial refrigeration business. Shipments are primarily made by common carrier from Company locations directly to customers. The Company’s prime competitors in the plumbing markets are Mueller Industries, Inc., a publicly-owned company listed on the New York Stock

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Exchange, and NIBCO Inc., a privately-held company headquartered in Elkhart, Indiana. The competition in the construction market is comprised of a number of manufacturers of parts for air conditioning, refrigeration, and plumbing systems. The Company believes that competition is based on a number of factors including service levels, pricing, breadth of product offering, product quality, delivery, and value. Some of the Company’s competitors may have significantly greater financial resources than the Company.

The majority of the Flow Control Products segment’s business is based on customer purchase orders for their current product requirements. Such orders are filled from inventory positions maintained in the regional warehouse distribution network. In certain situations, longer-term supply arrangements are in place with major customers. Such arrangements are of the type that stipulate a certain percentage of the customer’s requirements to be delivered at a specific price over a set period of time. Such arrangements are beneficial to the Company in that they provide firm forecasts of demand that allow for efficient use of equipment and manpower.

See Properties at Item 2 of this report for information on the Company’s facilities that operate in this segment.

ENGINEERED COMPONENTS

The Engineered Components segment produces cast metal products for sale to global original equipment manufacturers and tier-one suppliers in the automotive industry. The Company’s manufacturing processes involve the melting of raw materials for casting into metal products having the configuration, flexibility, strength, weight, and finish required for the customers’ end use. Products manufactured by this segment include aluminum castings for suspension, air conditioning, brake systems, and cast aluminum wheels for use on automobiles and light trucks. Delivery is mostly by common carrier from Amcast locations directly to customers.

The Engineered Components segment is not solely dependent on a single customer; however, substantially all of the Engineered Components business is directly or indirectly dependent on the automobile manufacturing industry. Only one customer, the General Motors Corporation (GM), accounted for greater than 10% of the Company’s sales. Sales to various divisions of GM were $146.2 million, $142.4 million, and $117.9 million for 2003, 2002, and 2001, respectively.

Competition in the automotive components industry is global with numerous competitors. There are approximately 25 competitors in the aluminum automotive component business serving the North American market. Principal competitors include Alcoa; Hayes Lemmerz International, Inc.; Intermet Corporation; Stahl Specialty Company, a subsidiary of the Budd Co.; and Citation Corporation, some of which have significantly greater financial resources than the Company. The basis of competition is generally design and engineering capability, manufacturing and process capability, price, product quality, and delivery.

There are approximately 18 producers of aluminum wheels that service the North American market. The largest of these are Superior Industries International, Inc. and Hayes Lemmerz International, Inc. The next tier of suppliers includes the Company, Alcoa, and Enkei America Inc. Some of the Company’s competitors in the aluminum wheel business have significantly greater financial resources than the Company.

The Company operates on a “blanket” order basis and generally supplies all of the customers’ annual requirements for a particular part. Customers issue production releases and shipping schedules each month against their blanket orders depending on their current needs. As a result, order backlog varies from month to month and is not considered firm beyond a 30-day period.

See Properties at Item 2 of this report for information on the Company’s facilities that operate in this segment.

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GENERAL INFORMATION

Domestic export sales were $70.2 million, $38.6 million, and $20.1 million in 2003, 2002, and 2001, respectively.

Aluminum, copper, and brass, which are essential raw materials to the business, are commodity-based metals purchased from local sources of supply. Supplier selection is based upon quality, delivery, reliability, price, and terms. Availability of these materials is judged to be adequate. The Company does not anticipate any material shortage that will alter production schedules during the coming year.

Aluminum and copper are basic commodities traded in international markets. Changes in aluminum, copper, and brass costs are generally passed through to the customer. Changes in the cost of aluminum are currently passed through to the customer based on various formulas as is the custom in the automotive industry sector the Company serves. Copper and brass cost increases and decreases are generally passed through to the customer in the form of price changes as permitted by prevailing market conditions. The Company is unable to project whether these costs will increase or decrease in the future. The Company’s ability to pass through any increased costs to the customer in the future will be determined by, among other factors, market conditions at that time.

The Company owns a number of patents and patent applications relating to the design of its products. While the Company considers that in the aggregate these patents are important to its operations, it believes that the successful manufacture and sale of its products generally depend more on the Company’s technological know-how and manufacturing skills.

Net capital expenditures related to compliance with federal, state, and local environmental protection regulations for fiscal 2004 and 2005 are not expected to be material. Based on current information, management does not anticipate that operating costs related to environmental protection will have a materially adverse effect on future earnings or the Company’s competitive position in the industry.

The Company employed approximately 2,315, 2,633, and 2,550 associates at August 31, 2003, 2002, and 2001, respectively. As of August 31, 2003, 2002, and 2001, the percentage of the Company’s workforce covered under some form of a collective bargaining unit agreement was approximately 25%, 26%, and 22%, respectively.

In general, sales and production in the automotive industry are cyclical and vary based on the timing of consumer purchases of vehicles and overall economic strength. Production schedules can vary significantly from quarter to quarter to meet customer demands.

WEBSITE ACCESS TO REPORTS

The Company’s internet website is www.amcast.com. The Company’s annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act are available free of charge through the Company’s website (under News/Stock Information) as soon as reasonably practicable after they are electronically filed with, or furnished to, the Securities and Exchange Commission.

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Cautionary Statements Under the Private Securities Reform Act of 1995

Certain statements in this Report, in the Company’s press releases and in oral statements made by or with the approval of an authorized executive officer of the Company constitute “forward-looking statements” as that term is defined under the Private Securities Litigation Reform Act of 1995. These statements may, for example, state projections, forecasts, or estimates about Company performance and industry trends. The achievement of the projections, forecasts, or estimates is subject to certain risks and uncertainties. Due to circumstances beyond the Company’s control, actual results and events may differ materially from those projected, forecasted, or estimated. Factors which may cause actual results to differ materially from those contemplated by the forward-looking statement include, among others: general economic conditions less favorable than expected; fluctuating demand in the automotive and construction industries; less favorable than expected growth in sales and profit margins in the Company’s product lines; increased competitive pressures in the Company’s Engineered Components and Flow Control Products segments; effectiveness of production improvement plans; cost of raw materials; disposal of certain non-strategic assets; labor relations at the Company and its customers; the impact of homeland security measures; and the ability of the Company to satisfy obligations under, and to comply with the provisions of, its loan documents. This list of factors is not meant to be a complete list of items that may affect the accuracy of forward-looking statements, and as such all forward-looking statements should be analyzed with the understanding of their inherent uncertainty.

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ITEM 2—PROPERTIES

The following table provides certain information relating to the Company’s principal facilities.

The land and building in Burlington, Ontario, are leased under a five-year lease expiring in 2006. The land in Richmond and the land in Gas City, Indiana, are leased under 99-year leases, expiring in 2091. The Corporate offices are being leased for two years expiring in 2005, with an option for a five-year renewal. The Amcast Automotive offices in Southfield, Michigan, are being leased for five years expiring in the year 2004, with an option for a five-year renewal. The Amcast component and wheel plant storage building in Detroit, Michigan is leased until 2004, with an option for a three-year renewal. The Company owns all other properties.

The Company’s operating facilities are in good condition and are suitable for the Company’s purposes. Utilization of capacity is dependent upon customer demand. During 2003, total company-wide productive capacity utilization ranged from 69% to 84% and averaged 79% of the Company’s total capacity.

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ITEM 3 – LEGAL PROCEEDINGS

Certain legal matters are described at “Commitments and Contingencies” in the Notes to Consolidated Financial Statements.

A group of nine plaintiffs brought a superfund private cost recovery and contribution action against the Company and fifty-one other parties in the United States district Court for the Southern District of Ohio, Western Division, which is captioned, Cargill, Inc. et al. V. Abco construction, et al. (Case No. C-3-98-3601). The action involves the Valleycrest disposal site in Dayton, Ohio. The plaintiffs have taken the lead in investigating and remediating the site. The Company believes its responsibility with respect to this site is very limited due to the nature of the foundry sand waste it is alleged to have disposed at the site. The Company is defending this matter vigorously.

ITEM 4 – SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

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EXECUTIVE OFFICERS OF REGISTRANT

Byron O. Pond, age 67, has been Chairman of the Board since April, 2002. From April 2002 to July 2003, Mr. Pond was Chairman of the Board and Chief Executive Officer. From February 2001 to April 2002, Mr. Pond was President and Chief Executive Officer of the Company. From 1996 to 1998, Mr. Pond served as Chairman and CEO of Arvin Industries, Inc. (a leading manufacturer of automotive emission and ride control systems) and from 1993 to 1996 as President and CEO of Arvin. He became Arvin’s President and Chief Operating Officer in 1991.

Joseph R. Grewe, age 55, has been President and Chief Executive Officer since July 2003. From April 2002 to July 2003, Mr. Grewe was Chief Operating Officer and a director of the Company. Mr. Grewe was Group President, Film & Fabrics from 2001 to 2002 and Divisional Vice President, Fluid Systems from 1999 to 2001, of Saint-Gobain (a diversified, multi-national group of manufacturing companies headquartered in France, active in glass, high-performance materials and construction products). From 1998 to 1999 Mr. Grewe was Executive Vice President, Commercial Business and from 1996 to 1998 Vice President, Operations of Furon Company (a designer, developer, and manufacturer of engineered polymer products).

Dale A. Dieckbernd, age 52, has been Vice President of Manufacturing of Flow Control since April, 2002. From 1997 to 2002, Mr. Dieckbernd was Vice President of Manufacturing for Amcast’s Elkhart Products operation.

Francis J. Drew, age 58, has been Vice President-Finance and Chief Financial Officer of the Company since April 2001. From 1998 to 2001, Mr. Drew was involved in middle market mergers and acquisitions as Vice President of The Charter Group in Grand Rapids, Michigan. Prior to that, he served as Vice President and CFO for Benteler Automotive Corporation’s operations in the United States.

Dean Meridew, age 49, has been Vice President and General Manager of the North American Wheel Division since September 1999. From September 1997 to September 1999, he was Vice President, Amcast Europe. From June 1992 to September 1997, he was Division Manager for the Company’s North American wheel operations. Prior to that, Mr. Meridew was Operations Manager and Engineering Manager within the Company’s North American wheel operations since January 1985.

Ronald A. Page, age 58, has been Vice President and General Manager, Automotive Components, since June 2002. Mr. Page was Plant Manager of Amcast’s Wapakoneta, Ohio facility from 2000 to 2001. From 1998 to 2000, he was President of Pacific Baja Light Metals, Inc. located in Temecula, California. From 1994 to 1998, he was General Manager of Hayes Lemmerz. From 1990 to 1994, he was Executive Vice President of Contouring Technologies, Inc.

Michael R. Higgins, age 57, has been Treasurer since January 1987.

Jeffrey A. McWilliams, age 40, has been Vice President, Administration and Secretary of the Company since August, 2003. Mr. McWilliams was Director of Taxation of the Company from November, 1996 to August, 2003. From 1991 to 1996, he was Corporate Tax Manager for American Premier Underwriters.

Mark D. Mishler, age 45, has been Corporate Controller since April, 1998. From April 1995 to April 1998, he was International Controller for Witco. From April 1991 to April 1995, he was a Division Controller for Siemens. Mr. Mishler is a Certified Public Accountant and is a Certified Management Accountant.

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PART II

ITEM 5 – MARKET FOR THE REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Amcast common stock is traded on the OTC Bulletin Board, ticker symbol AICO.OB. As of August 31, 2003, there were 9,241,143 of the Company’s common shares outstanding, and there were approximately 5,614 shareholders of Amcast’s common stock, including shareholders of record and the Company’s estimate of beneficial holders.

Certain information concerning the payment of dividends is located at “Liquidity and Capital Resources” in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of this Report.

See Item 12 for the equity compensation plan information.

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ITEM 6 – SELECTED DATA

($ in thousands except per share amounts)

ITEM 7 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

($ in thousands except per share amounts)

Cautionary Statements Under the Private Securities Reform Act of 1995

Certain statements in this Report, in the Company’s press releases and in oral statements made by or with the approval of an authorized executive officer of the Company constitute “forward-looking statements” as that term is defined under the Private Securities Litigation Reform Act of 1995. These statements may, for example, state

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projections, forecasts, or estimates about Company performance and industry trends. The achievement of the projections, forecasts, or estimates is subject to certain risks and uncertainties. Due to circumstances beyond the Company’s control, actual results and events may differ materially from those projected, forecasted, or estimated. Factors which may cause actual results to differ materially from those contemplated by the forward-looking  statement include, among others: general economic conditions less favorable than expected; fluctuating demand in the automotive and construction industries; less favorable than expected growth in sales and profit margins in the Company’s product lines; increased competitive pressures in the Company’s Engineered Components and Flow Control Products segments; effectiveness of production improvement plans; cost of raw materials; disposal of certain non-strategic assets; labor relations at the Company and its customers; the impact of homeland security measures; and the ability of the Company to satisfy obligations under, and to comply with the provisions of, its loan documents. This list of factors is not meant to be a complete list of items that may affect the accuracy of forward-looking statements, and as such all forward-looking statements should be analyzed with the understanding of their inherent uncertainty.

The following discussion and analysis provides information which management believes is relevant to an understanding of the Company’s consolidated results of operations and financial condition. This discussion should be read in conjunction with the accompanying consolidated financial statements and notes.

Business Segments

Operating segments, in accordance with SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information”, are organized internally primarily by the type of products produced and markets served. The Company has aggregated similar operating segments into two reportable segments: Flow Control Products and Engineered Components. The Flow Control Products segment is a supplier of copper and brass plumbing fittings for the industrial, commercial, and residential construction markets, and cast and fabricated metal products for sale to original equipment manufacturers in the transportation, construction, air conditioning, and refrigeration industries. The Engineered Components segment is a supplier of aluminum wheels and aluminum components, primarily for automotive original equipment manufacturers.

Acquisitions and Divestitures

As described more fully in the notes to the consolidated financial statements, in March 2003 the Company sold Speedline S.r.l. (Speedline), its Italian manufacturing operation, which produced aluminum wheels for passenger cars and trucks, as well as aluminum and magnesium racing wheels. The Company determined that Speedline’s unfavorable cost structure would not allow it to maintain market position and generate adequate returns in a changing market environment that included heightened competition. The Company decided that it would be in the shareholders’ best interest to exit this business and focus its efforts and resources on its North American manufacturing operations. Unless otherwise indicated, all comparisons of results of operations in this Management’s Discussion and Analysis exclude the results of Speedline and relate solely to the Company’s continuing operations.

Effective June 5, 2001, the Company purchased the remaining 40% share in Casting Technologies Company (CTC), from Izumi Industries, LTD, bringing the Company’s total ownership to 100%. The financial results of CTC are included as part of the Engineered Components segment in the consolidated financial statements since the purchase of the remaining 40% share.

As part of its obligations under its Restructuring Agreements, the Company must, among other options, explore the possibility of selling off part or all of its assets to a qualified buyer, as that term is defined in the Restructuring Agreements (see “Liquidity and Capital Resources”).

Unusual Items in Fiscal 2001

In October 2000, the Company announced that it had hired financial advisors to assist the Company in exploring strategic alternatives for maximizing shareholder value. This process included evaluating the possible sale of the

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business, various business combinations, and several break-up scenarios. During the first half of 2001, the Company incurred legal and other professional fees for a strategic alternative review. After careful consideration, in early February 2001, the Company’s Board of Directors reached a decision that, even in the currently weakened market environment, a stronger pursuit of the Company’s fundamental strategy would, over the long term, better serve the shareholders. At the same time, the Company’s Board of Directors made several senior management changes that would provide the leadership needed to move the Company forward which resulted in additional expense for severance and related costs.

Due to operating losses incurred during the second fiscal quarter, on March 4, 2001, the Company was not in compliance with certain non-monetary covenants under its then-existing credit agreement (the Revolver Agreement). This resulted in a cross violation in the Company’s Senior Note Agreement (the Senior Notes). The Company incurred significant costs related to obtaining covenant waivers. Debt covenants are discussed further under “Liquidity and Capital Resources”.

In the last half of 2001, the new management of the Company initiated a strategic review of the Company in light of its weak markets and relatively poor operating performance. As a result, the Company disposed of certain under-utilized machinery, tooling and equipment; scrapped certain slow moving inventories; and increased the allowance for doubtful and disputed receivables. In addition to establishing reserves for these items, the unusual items also included increased workers compensation and certain other reserves for previously closed facilities, increased environmental reserves, and other accrual adjustments. Additionally, due to past operating results at the Company’s European operations, in compliance with SFAS No. 109, “Accounting for Income Taxes”, the Company increased its valuation allowance against certain foreign net operating loss carryforwards.

These unusual items, recorded in 2001, totaled $25,478 ($16,051 net of tax) for its North American operations. In addition, the Company’s share of CTC’s unusual charges prior to June 5, 2001, which are included in Other Income and Expense, was $1,267 ($803 net of tax). There were no significant additional charges of this nature in 2003 or 2002.

Transition From The New York Stock Exchange (NYSE) To The OTC Bulletin Board

The NYSE suspended trading of the Company’s stock at the opening of trading on April 1, 2003 because the Company no longer met the equity and market capitalization standards that requires a listed company to have an average market capitalization and net worth of not less than $50 million. The Company determined that it would not be able to achieve the NYSE listing requirements within the NYSE’s prescribed timeframe, and, on April 1, 2003, the Company transferred from the NYSE to the OTC Bulletin Board. The Company’s new stock symbol is AICO.OB.

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Results of Operations

Net Sales

In 2003, consolidated net sales increased $7,103 to $423,920. This increase was driven by an improved product mix and increased volume, partly offset by price. Increased global wheel and global aluminum component volume attributable to growth in new and existing products was mostly offset by lower Flow Control Products volume due to competitive market pressures. A favorable product mix was due to global wheel and Flow Control Products sales. Unfavorable pricing continued in the Flow Control Products segment due to competitive market conditions. In segments, Engineered Components sales increased by 6.2% due primarily to greater volume and secondarily to product mix, and Flow Control Products sales decreased by 7.6% primarily due to lower volume and secondarily to unfavorable pricing.

In 2002, consolidated net sales increased $38,900 to $416,817. The volume increase in 2002 was driven by global wheel and global aluminum component sales. The increase in wheel and component volume was partly offset by a decline in Flow Control Products volume. A favorable product mix, primarily reflected in global wheel sales, helped to offset lower prices from the pass-through price of lower aluminum costs to customers and the unfavorable pricing that continued in the Flow Control Products segment due to competitive market pricing. Consolidating CTC for all of 2002 also increased sales. In segments, Engineered Components sales increased by 23.8% due to higher and more profitable sales, and Flow Control Products sales decreased by 9.9%. If CTC were consolidated in the first nine months of 2001, consolidated net sales would have increased by 3.1% in 2002.

Gross Profit

Gross profit in 2003 increased $4,370 to $50,591, or 11.9% of sales compared with $46,221 or 11.1% of sales in 2002. This higher profitability came from the Engineered Component segment which benefited from higher sales and lower costs due to the Amcast Production System (APS) and a company-wide cost reduction program. APS, a more efficient manufacturing approach being implemented at the Company’s manufacturing facilities, helped to increase gross profit by improving productivity and reducing manufacturing costs. APS should continue to be a positive factor on gross profit as more of the Company’s workforce becomes certified. In the Flow Control Products segment, reduced sales volume and lower pricing in a highly competitive market were the primary reasons for a gross profit decline. The Flow Control gross profit decline was partly offset by lower costs due to the APS and cost reduction programs. In 2003, the Company also had liquidations of LIFO inventory layers due

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to lower inventory balances that increased gross profit by $1,461. As a result of certain policy changes in 2002, the Company reduced its employee vacation liability by $1,601, of which $1,175 improved cost of goods sold and $426 improved selling, general, and administrative expenses (SG&A).

The following table provides a reconciliation for 2002 gross profit and SG&A excluding the 2002 one-time impact of reducing the Company’s vacation liability and terminating postretirement life insurance:

For 2002, the $12,628 increase in gross profit was attributable to the Engineered Component segment of business. This segment experienced a higher gross profit due to new aluminum components and wheel products and improved manufacturing efficiencies, partly offset by $7 million in new product launch costs at the Richmond, Indiana facility. Wheel manufacturing benefited from higher sales volume and an improved price and product mix. In the Flow Control Products segment, lower pricing decreased gross profit. Excluding the unusual items recorded in 2001, gross profit increased by $7,854.

Selling, General, and Administrative Expenses

Selling, general, and administrative expenses decreased $1,790 in 2003 compared with 2002. In 2002, the Company discontinued offering postretirement life insurance for all retirees, except for certain bargaining unit employees, which lowered the postretirement obligation by $919. Excluding this amount and a reduction to the employee vacation liability of $426 discussed previously in the “Gross Profit” section, SG&A in 2002 would have been $40,455 or 9.7% of sales. The decrease in SG&A was a direct result of the Company’s continued focus on cost reduction. Also in 2002, the Flow Control Products segment incurred high information technology costs related to installing a new ERP system, and these expenses were not incurred in 2003.

Selling, general, and administrative expenses decreased $15,951 in 2002 compared with 2001. The decrease in SG&A is primarily due to expenses recorded of $19,410 in 2001 for the unusual items discussed under “Unusual Items” of the MD&A. Excluding unusual items, SG&A as a percentage of sales was 9.4% for 2001. SG&A in 2002 included CTC operating expenses for a full year; whereas in 2001, CTC operating expenses were only included for the fourth quarter.

Equity Earnings (Losses) of Joint Ventures

Prior to Amcast acquiring the remaining 40% ownership of CTC at the beginning of the fourth quarter of 2001, CTC was a joint venture with a Izumi Industries, LTD, and financial results were recorded using the equity method of accounting. The Company’s pretax share of losses from CTC while a joint venture, were $3,122 in 2001 and is included in other (income)/expense in the income statement.

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Interest Expense

Interest expense was $15,142 in 2003, $17,130 in 2002, and $16,159 in 2001. Interest expense declined in 2003 due to lower interest rates and reduced debt balances. Interest expense is further discussed under “Liquidity and Capital Resources.”

Effective Tax Rates

The effective tax rate from continuing operations for 2003, 2002, and 2001 was 40.8%, 53.1%, and 35.0%, respectively. The different tax rates are primarily due to the impact of state taxes and the relatively small level of pretax losses which amplify the percentage impact of a small dollar change in taxes. As of August 31, 2003, the Company has a valuation allowance against deferred tax assets of $47,448. Of the total allowances, $30,606 relates to the sale of Speedline, $7,155 relates to the net operating loss carryforwards associated with the Izumi, Inc. stock, and $9,687 relates to recording of the Company’s minimum pension liability. As for the $30,606 valuation allowance related to the sale of Speedline, the Company believes it may be able to recognize, at some point in future fiscal years, a substantial portion of the tax benefit currently limited by Statement of Financial Accounting Standards (SFAS) No. 109, “Accounting for Income Taxes”.

Cumulative Effect of Accounting Change in Fiscal 2003

In 2003, the Company was required to adopt SFAS No. 142, “Goodwill and Other Intangible Assets”. Under the adoption of SFAS No. 142, goodwill and certain other intangible assets are no longer amortized but will be reviewed annually for impairment. If, based on these reviews, the related assets are found to be impaired, their carrying value will be adjusted through a charge to earnings. Upon adoption of SFAS No. 142 in the first quarter of fiscal 2003, the Company completed its impairment review and determined that all of its goodwill, relating primarily to Speedline, was impaired. This impairment is reflected in the Company’s declining stock price and the weak financial performance of the reporting units related to the impaired goodwill. As such, the Company recorded a non-cash charge of $46,536, net of tax of $464, to reduce the carrying value of its goodwill to zero. This charge is recorded as a cumulative effect of an accounting change in the accompanying consolidated financial statements. See “Goodwill” in the Notes to Consolidated Financial Statements.

Business Segments

Flow Control Products    Net sales of the Flow Control Products segment were $125,912 in 2003, compared with $136,262 in 2002 and $151,216 in 2001. In 2003, the Flow Control Products segment continued to operate in an environment with strong competitive market pricing. This environment caused a sales decline in both volume and price, which reduced sales by 8.1% and 2.1%, respectively. This decline was partly offset by a favorable product mix. Operating income for the Flow Control Products Segment was $4,918 in 2003, compared with $5,700 in 2002 and $5,471 in 2001. This decrease in operating income was due to lower price and lower sales volume partly offset by improved manufacturing productivity due to APS and cost reduction programs. Residential construction has faired slightly better than anticipated, however the more profitable commercial and industrial markets remain weak.

In 2002, the Flow Control Products segment encountered strong competitive market pricing that produced a sales decline in both volume and price, which was offset slightly by a favorable product mix. Excluding unusual items in 2001, operating income decreased by $5,998 in 2002. This decrease in operating income was primarily due to the competitive pricing in the marketplace and higher information technology costs of $3 million from a new ERP system.

Engineered Components    Net sales of the Engineered Components segment were $298,008 in 2003, compared with $280,555 in 2002 and $226,701 in 2001. Higher sales volume in both aluminum component and wheel products increased sales by 4.3% in 2003. Sales were also higher due to a more favorable price and product mix.

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Engineered Components had operating income of $17,438 in 2003, compared with operating income of $6,777 in 2002 and an operating loss of $9,239 in 2001. The increase in operating income for 2003 is primarily due to higher sales volume, an improved product mix, productivity gains from APS and cost reduction programs, and abnormally high start up costs at the Company’s Richmond plant in 2002 which were not incurred in 2003.

In 2002, sales increased due to higher sales volume in both aluminum component and wheel products. Sales also increased due to a more favorable price and product mix and consolidating CTC for the full year. These positive factors more than offset the slight sales decline caused by a decrease in the price of aluminum which was “passed-through”, by contract, to many customers. The increase in operating income was primarily the result of the unusual items recorded in 2001, improved operating efficiencies and higher sales volume, which offset the slight decline in price and product mix, mostly caused by the reduction in aluminum prices.

Corporate expenses in 2003 increased compared with 2002 primarily due to the one-time benefit from ending post retirement life insurance recorded in 2002 and reduced pension income in 2003.

Liquidity and Capital Resources

The Company’s cash balance at August 31, 2003 was $5,697. An additional $7,078 of restricted cash existed for payment of principal and interest on the Company’s debt that is required under its debt agreements. Under the Company’s cash management system, issued checks that have not cleared the bank resulting in net overdraft bank balances for accounting purposes in the amounts of $5,271 in 2003 and $2,058 in 2002 are included in accounts payable.

Cash provided by operations in 2003 was $7,565, compared with $23,754 in 2002 and $3,888 in 2001. Operating cash flow from the income statement increased in 2003, however this increase was more than offset by unfavorable balance sheet changes:

The two main reasons for the balance sheet net cash usage in 2003 were the increase in restricted cash, mentioned above, and a decline in accounts payable caused by lower inventory levels and by accelerated vendors payment terms. With the new debt agreement signed at the end of fiscal 2003, the Company anticipates vendor payment terms returning to normal which, in turn, should return accounts payable to more normal levels. The debt extension is also discussed in the Notes to Consolidated Financial Statements and later in this section.

The balance sheet cash usage from restricted cash and accounts payable were partly offset by cash generated from lower inventory due to the Amcast Production System and from lower accounts receivable due to a focus on collecting past due accounts. The inventory and receivables reduction occurred during a period of increased sales. Reported income after adding back non-cash transactions of depreciation, amortization, the cumulative effect of the accounting change, and the loss on discontinued operations, show an increase in cash flow from the income statement.

Investing activities used net cash of $7,807 in 2003, compared with $14,233 in 2002 and $20,879 in 2001. Investing activities are primarily for capital expenditures, which totaled $9,369 in 2003 compared with $15,117 in 2002 and $21,596 in 2001. Capital expenditures decreased in 2003 from prior levels, as the Company conserved cash by limiting expansion spending. Capital expenditures in 2003 were primarily for equipment to expand plant capacity for volume growth and new product orders. At August 31, 2003, the Company had $1,197 of commitments for capital expenditures to be made in 2004, primarily for the Engineered Components segment.

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Financing activities used cash of $10,056 in 2003 compared with cash used of $3,509 in 2002 and cash provided of $28,293 in 2001. In 2003, the Company made debt payments of $3,895 for the bank debt and senior notes and $3,605 for the LIFO credit facility. CTC made debt payments of $3,000 on its term loan and had net borrowing activity on its revolver loan of $300. The Company also had net borrowing activity for its financed insurance coverage of $144. The Company did not declare dividends in 2003 and currently has no plans of declaring dividends in the immediate future.

In August of 2003, the Company successfully negotiated a restructuring of its credit facilities with its lender group and senior note holders (the Restructuring Agreements). This restructuring included the LIFO credit agreement (the LIFO Agreement). As restructured, the bank credit facilities, the senior notes, and the LIFO credit agreement have been continued to September 14, 2006. Outstanding debt balances as of August 31, 2003 were, $113,619 for the bank credit facilities, which includes $100,826 for revolving credit notes and $12,793 for lines of credit, $45,664 for the senior notes, and $11,395 for the LIFO credit agreement. The Company cannot borrow additional funds from its bank group, senior note holders, lines of credit, or LIFO credit agreement. These lenders have security interests in the assets of the Company and its subsidiaries.

The Restructuring Agreements initially arose from the Company becoming out of compliance with the debt-to-earnings and interest coverage ratios on March 4, 2001 under the then-existing Revolver Agreements. This event resulted from operating losses during the second fiscal quarter of 2001 and also caused a cross violation of the Company’s Senior Note Agreement (the Senior Notes).

Interest rates for outstanding borrowings are prime plus 2% for revolver borrowings, lines of credit, and the LIFO Agreement, and 9.09% plus 1% payment in kind for the senior notes.

The Company is required to make debt payments of $1,000 by February 28, 2004, and $300 by May 31, 2004. These payments will be applied first to the LIFO credit facility, and second to the bank facilities and the senior notes on a pro rata basis. In addition, the Company was required to reduce its LIFO debt by $1,000 upon the release of the restricted cash for the CTC debt. These payments are the only debt principal payments required by the Restructuring Agreements and the LIFO Agreement prior to maturity; however, the Company is required to pay debt fees of 75 basis points times the aggregate amount of outstanding borrowings under the Restructuring and LIFO Agreements on September 1, 2003, and 50 basis points times the aggregate amount of any outstanding borrowings on December 31, 2004 and December 31, 2005.

The Restructuring Agreements contain certain financial covenants regarding a fixed charge coverage ratio; quarterly earnings before interest, taxes, depreciation and amortization (EBITDA); and capital expenditures. At the end of any subsequent quarter, if the Company is not in compliance with any of the debt covenants, any outstanding balances become payable on demand by the Company’s lenders. Based on the Company’s forecasted ability to comply with the debt covenants, it continues to classify this debt as long term.

The Restructuring Agreements provide that financial covenants may be adjusted based on a final company plan approved by the lender group.

The Restructuring Agreements contain a covenant that requires the Company to use its good faith best efforts to refinance all of the Restructuring and LIFO Agreement debt on or before September 1, 2004, or sell substantially all of its assets before September 1, 2004. The Agreements contain eight milestones that specify that certain events be met by certain dates. The first event requires the retention of an investment advisor by August 31, 2003. This event has been satisfied. In the opinion of the Company, four of the seven remaining milestones are reasonably in the control of the Company. The other three are not. In the event of a missed event, a $200 fee must be paid for each missed occurrence.

In September 2003, CTC signed a credit agreement (the CTC Agreement) with the Provident Bank. This agreement provides for a three-year revolving line of credit of up to $5,000 and a five-year term loan of $3,000.

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At August 31, 2003, $3,400 was outstanding on the revolver and $2,856 was outstanding on the term loan, both with interest rates at prime plus 0.5% or LIBOR plus 2.75%. The revolver loan matures in September 2006 and the term loan matures in September 2008. As of August 31, 2003, $1,600 was available for borrowings under the revolving credit facility. Any default under the debt covenants established for the Restructuring Agreement and the LIFO Credit Agreement will result in a cross violation for the CTC Agreement.

The ratio of long-term debt as a percent of capital increased to 130.9% at August 31, 2003 from 67.3% at August 31, 2002. Book value per common share at August 31, 2003 was $(4.54), down from $10.52 at August 31, 2002. One million preferred shares and approximately 5.4 million common shares are authorized and available for future issuance. On December 17, 1998, the Company announced a plan to repurchase up to 750,000 of its outstanding common shares. As of August 31, 2003, 350,000 shares have been repurchased under this plan at an average cost of $15.53 per share. As of August 31, 2003, the Company had 9,241,143 common shares outstanding. Management believes the Company has adequate financial resources to meet its future obligations.

Critical Accounting Policies

The Company describes its significant accounting policies in the notes to the consolidated financial statements included in the Company’s Annual Report on Form 10-K. Since application of these accounting policies involves the exercise of judgement and use of estimates, actual results could differ from those estimates.

Revenue Recognition – Revenue is recognized at the time products are shipped to unaffiliated customers, legal title has passed, and all significant contractual obligations of the Company have been satisfied.

Inventory Valuation – Inventories are valued at the lower of cost or market using the last-in, first out (LIFO) and the first-in, first-out (FIFO) methods. Raw material inventories are primarily aluminum and copper, both of which have market prices subject to volatility.

Environmental Reserves – The Company recognizes an environmental liability when it is probable the liability exists and the amount can be reasonably estimated. The Company adjusts the environmental reserve when it is determined that circumstances warrant the change. Actual remediation obligations may differ from those estimated.

Pension Benefits and Costs – The Company has pension benefits and expenses that are developed from actuarial valuations. These valuations are based on assumptions including, among other things, interest rate fluctuations, discount rates, expected returns on plan assets, retirement ages, and years of service. Future changes affecting the assumptions will change the related pension benefit or expense.

Deferred Taxes – Deferred income taxes are provided for temporary differences between financial and tax reporting in accordance with the liability method under the provisions of SFAS No. 109, “Accounting for Income Taxes”. Significant factors considered by the Company in estimating the probability of the realization of deferred taxes include expectations of future earnings and taxable income, as well as application of tax laws in the jurisdictions in which the Company operates.

At August 31, 2003, the Company had valuation allowances against some of its deferred tax assets. Valuation allowances serve to reduce the recorded deferred tax assets to amounts reasonably expected to be realized as tax savings in the future. Establishing valuation allowances and their subsequent adjustment requires a significant amount of judgment because realizing deferred tax assets, particularly those assets related to net operating loss carryforwards, is generally contingent on generating taxable income, reversing deferred tax liabilities in the future, and the availability of qualified tax planning strategies.

Debt Covenants – For a substantial portion of its debt, the Company has certain financial covenants that it must maintain as part of its debt agreements. See “Liquidity and Capital Resources”. If the requirements of the covenants are not achieved, this debt becomes immediately payable, which would significantly impact the Company’s ability to maintain its current operations.

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The Company does not have off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “special purpose entities” (SPEs).

The Company is exposed to market risk from changing commodity prices and interest rates as part of its normal operations, as well as general risks and uncertainties which are inherent in any competitive industry.

Commodity Prices

The Company is exposed to market risk from price changes in commodity metals, which are raw materials used in its normal operations. When market conditions warrant, forward fixed-price commodity metal supply contracts may be entered into with certain suppliers. These purchase contracts cover normal metal usage in the ordinary course of business over a reasonable period of time. Lower-of-cost-or-market valuation adjustments on these contracts is reflected in earnings in the period incurred. At August 31, 2003, the Company had no forward fixed-price metal supply contracts.

Interest Rate Risk

The Company has both fixed and variable rate debt. At August 31, 2003 and 2002, the Company had $131,270 and $140,985 of debt obligations outstanding with variable interest rates with a weighted-average effective interest rate of 5.9% and 6.7%, respectively. A hypothetical 10% change in the effective interest rate for these borrowings, using the outstanding debt levels at August 31, 2003, and 2002, would change interest expense by approximately $778 and $949 respectively. The decrease in interest rate exposure is primarily due to lower effective interest rates.

Inflation

Inflation did not have a material impact on the Company’s results of operations or financial condition for 2003 or 2002.

Contingencies

See “Commitments and Contingencies” in the Notes to the Consolidated Financial Statements.

Impact of Recently Issued Accounting Standards

See “Impact of Recently Issued Accounting Standards” in Notes to the Consolidated Financial Statements.

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ITEM 8 – FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Amcast Industrial Corporation’s Responsibility for Consolidated Financial Statements

We are responsible for the preparation of the accompanying consolidated financial statements of Amcast Industrial Corporation (Amcast or the Company), as well as their integrity and objectivity. These financial statements were prepared in conformity with accounting principles generally accepted in the United States of America and include our best estimates and judgments.

We are also responsible for maintaining a comprehensive system of internal controls and establishing and maintaining disclosure controls and procedures. Our system of internal controls is designed to provide reasonable assurance that we can rely upon our accounting systems and the underlying books and records to prepare financial information presented in accordance with accounting principles generally accepted in the United States of America and that our associates follow established policies and procedures. Our disclosure controls and procedures are designed to timely alert our Chief Executive Officer and Chief Financial Officer to material information required to be included in our periodic Exchange Act filings. We continually review our system of internal controls and disclosure controls and procedures for effectiveness. We consider the recommendations of our internal auditors and independent auditors concerning internal controls and disclosure controls and procedures and take the necessary actions that are cost-effective in the circumstances.

The Audit Committee of our Board of Directors, comprised entirely of independent directors who are not Amcast associates, is responsible for assuring that we fulfilled our responsibilities in the preparation of the accompanying consolidated financial statements. The Audit Committee meets regularly with our internal auditors, the independent auditors and Amcast management to review their activities and ensure that each is properly discharging its responsibilities and assesses the effectiveness of our internal controls and disclosure controls and procedures. The Audit Committee is responsible for appointing the independent auditors and reviewing the scope of all audits and the accounting principles applied in our financial reporting. Ernst & Young LLP has been engaged as independent auditors to audit the accompanying consolidated financial statements and issue their report thereon, which appears on the following page.

To ensure complete independence, our internal auditors and Ernst & Young LLP have full and free access to meet with the Audit Committee, without Amcast management present, to discuss the results of their audits, the quality of our financial reporting and the adequacy of our internal controls and disclosure controls and procedures.

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REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

Shareholders and Board of Directors

Amcast Industrial Corporation, Dayton, Ohio

We have audited the accompanying consolidated statements of financial condition of Amcast Industrial Corporation and subsidiaries as of August 31, 2003 and 2002, and the related consolidated statements of operations, shareholders’ equity, and cash flows for each of the three years in the period ended August 31, 2003. Our audits also included the financial statement schedule listed in the Index at item 16 (a). These financial statements and schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Amcast Industrial Corporation and subsidiaries at August 31, 2003 and 2002, and the consolidated results of their operations and their cash flows for each of the three years in the period ended August 31, 2003, in conformity with accounting principles generally accepted in the United States. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed in “Accounting Policies” in the Notes to Consolidated Financial Statements, in 2003 the Company changed its method of accounting for goodwill and other intangible assets.

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CONSOLIDATED STATEMENTS OF OPERATIONS

($ in thousands except per share amounts)

See notes to consolidated financial statements

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CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

($ in thousands)

See notes to consolidated financial statements

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CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

($ in thousands, except per share amounts)