SEC Filing | Valmont Industries, Inc.

SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE THE SECURITIES EXCHANGE ACT OF 1934 [Fee Required] For the Fiscal Year Ended December 30, 1995 Commission File No. 0-3701 Valmont Industries, Inc. ------------------------ (Exact Name of Registrant as Specified in its Charter) Delaware 47-0351813 -------- ---------- (State or Other Jurisdiction (I.R.S. Employer of Incorporation or Organization) Identification Number) Valley, Nebraska 68064 ---------------- (Address of Principal Executive Offices) (Zip Code) Registrant's Phone Number, Including Area Code: (402) 359-2201 Securities Registered Pursuant to Section 12(g) of the Act: Valmont Industries, Inc. Common Stock ------------------------------------- $1.00 Par Value - Traded NASDAQ Stock Market (Symbol VALM) ---------------------------------------------------------- (Title of Class) ---------------- Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve 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 ninety days. Yes X No --- --- At March 1, 1996 there were outstanding 13,577,422 common shares of the Company. The aggregate market value of the voting stock held by non- affiliates of the Company on March 1, 1996 was $244,349,000. 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 definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ X ] Documents Incorporated by Reference ----------------------------------- Portions of the Company's annual report to shareholders for the fiscal year ended December 30, 1995 (the "Annual Report") are incorporated by reference in Parts I and II, and portions of the Company's proxy statement for its annual meeting of stockholders to be held on April 22, 1996 (the "Proxy Statement") are incorporated by reference in Part III. Page 1 of 67 ----- Index to Exhibits, Page 14 ----- PART I Item 1. Business. (a) General Description of Business Valmont Industries, Inc., a Delaware Corporation, (together with its subsidiaries the "Company") is engaged in industrial products and irrigation products businesses. The Industrial Products segment involves the manufacture and distribution of engineered metal structures and other fabricated products for industrial and commercial applications. The Irrigation Products segment involves the manufacture and distribution of agricultural irrigation equipment and related products. The description of Valmont's businesses set forth on pages 6 through 11 of the Company's Annual Report is incorporated herein by reference. The Company entered the Irrigation Products market in 1953 from its manufacturing location in Valley, Nebraska. The Industrial Products segment began producing and marketing engineered metal structures as a result of manufacturing support efforts for the irrigation business. Valmont has grown internally and by acquisition. Valmont has also divested certain businesses. Valmont's acquisitions include (i) an expansion into the French steel and aluminum structures market in 1989 with the acquisition of Sermeto, (ii) the acquisition in 1991 of Valmont Nederland B.V. (formerly Nolte Mastenfabriek B.V.), a Dutch manufacturer of steel poles structures, (iii) the acquisition in 1991 of an 80% interest in Lampadaires Feralux, Inc., a Canadian producer of aluminum pole structures, (iv) the acquisition in 1994 of the assets of Energy Steel Corporation of Tulsa, Oklahoma, a manufacturer of utility products, and (v) the acquisition of Microflect Company, Inc. in 1995, a manufacturer and installer of microwave communication structures. Divestitures include (i) the sale in 1994 of the assets of Good-All Electric, Inc., a Colorado producer of cathodic protection rectifiers, (ii) the 1993 sale of its investment in Inacom Corp., a national microcomputer reseller business initially established as a division of the Company, (iii) the 1993 exit of the Gate City Steel steel reinforcing bar business, and (iv) the 1989 divestiture of the Gate City Steel service center business. (b) Industry Segments The Company classifies its operations into two business segments: Industrial Products - The manufacture and distribution of engineered metal structures and other fabricated products. Irrigation Products - The manufacture and distribution of agricultural irrigation equipment and related products. The amounts of revenues, operating income and identifiable assets attributable to each segment for each of the last three years are set forth on page 30 of the Annual Report and incorporated herein by reference. (c) Narrative Description of Business Principal Products Produced and Services Rendered. -------------------------------------------------- The information called for by this item is hereby incorporated by reference to pages 6 through 11 in the Company's Annual Report. 2 Suppliers and Availability of Raw Materials. -------------------------------------------- Hot rolled steel coil and other carbon steel products are the primary raw materials utilized in the manufacture of finished products for the Industrial Products and Irrigation Products segments. These essential items are purchased from steel mills and steel service centers and are readily available. In addition to steel, key elements of the ballast manufacturing process are copper and aluminum wire. These items are obtained from wire mills and are also readily available. It is not likely that key raw materials would be unavailable for extended periods. Patents, Licenses, Franchises and Concessions. ---------------------------------------------- Valmont has a number of patents for its irrigation and ballast designs. The Company also has a number of registered trademarks. Management believes the loss of any individual patent would not have a material adverse affect on the financial condition of the Company. Seasonal Factors in Business. ----------------------------- Sales in the Company's irrigation segment can be somewhat seasonal based upon the agricultural growing season. Customers. ---------- The Company is not dependent for a material part of its business upon a single customer, or upon very few customers, the loss of any one of which would have a material adverse effect on the financial condition of the Company. Backlog. -------- The backlog of orders for the principal products manufactured and marketed was approximately $109.6 million at the end of the 1995 fiscal year and $111.1 million at the close of 1994. It is anticipated that most of the backlog of orders will be filled during fiscal year 1996. At year end, the backlog by segment was as follows (dollar amounts in millions): Dec. 30, Dec. 31, 1995 1994 --------- --------- Industrial Products $84.3 87.8 Irrigation Products 25.3 23.3 --------- --------- $109.6 111.1 ====== ====== Competitive Conditions. ----------------------- In the Industrial Products segment, Valmont is a major manufacturer and supplier of engineered metal structures to the lighting, utility and communication industries; the Company delivers a broad line of custom steel tubing products and manufactures and distributes lighting ballasts, fasteners and grating. The Irrigation Products segment involves the manufacture and distribution of mechanized irrigation equipment for both the U.S. and international markets. The Company believes it is the world's leading manufacturer of mechanized irrigation systems. The key competitive strategy used by the Company in each segment is one of high quality and service. 3 Research Activities. -------------------- The information called for by this item is hereby incorporated by reference to the following captioned paragraph (at the page indicated) in the Company's Annual Report: Page In Annual Paragraph Caption in Annual Report Report ---------------------------------- ------ RESEARCH AND DEVELOPMENT 28 Environmental Disclosure. ------------------------- The Company is subject to various federal, state and local laws and regulations pertaining to environmental protection and the discharge of materials into the environment. Although the Company continues to incur expenses and to make capital expenditures related to environmental protection, it does not anticipate that future expenditures will materially impact the financial condition of the Company. Number of Employees. -------------------- At December 30, 1995, the number of employees was 4,166. Financial Information about Foreign Operations and Export Sales. ---------------------------------------------------------------- Valmont's international sales activity encompasses approximately seventy foreign countries. The information called for by this item is hereby incorporated by reference to "Business Segment Information-Summary by Geographical Area" on page 30 of the Company's Annual Report. Item 2. Properties. The Company's primary plant and offices are located on a 352 acre site near Valley, Nebraska, which is approximately twenty miles west of Omaha, Nebraska. 336 of the acres are owned in fee. The other 16 acres are leased on a yearly basis from the Union Pacific Railroad Company, which serves the Company's primary plant, and which is entitled to terminate the lease on a one-year notice in the event that the land is required for railroad operations. The Valley, Nebraska location is used in common as the primary facilities by Irrigation Products and certain Industrial Products administrative and operating personnel. The Industrial Products segment's other significant properties are three locations in France, a newly constructed plant in Shanghai, China, and two locations for Valmont Electric. Valmont Electric leases plant and office facilities in El Paso, Texas under a long-term agreement. Valmont Electric also owns a plant and office facilities in Juarez, Mexico which are located on land held in trust under a long-term agreement. The Company's Microflect subsidiary leases office and plant facilities in Salem, Oregon under long-term leases. The Company operates other facilities as set forth on pages 2 and 3 of the Company's Annual Report, which information is incorporated herein by reference. Item 3. Pending Legal Proceedings. -------------------------- The Company is involved in a limited number of legal actions. Management believes that the ultimate resolution of all pending litigation will not have a material adverse effect on the Company's financial condition. Item 4. Submission of Matters to a Vote of Security Holders. ---------------------------------------------------- Not applicable. 4 Executive Officers of the Company - --------------------------------- The executive officers of the Company, their ages, positions held, and the business experience of each during the past five years are, as follows: Robert B. Daugherty, Age 74, Chairman of the Board and Director of the Company continuously since March 1947. Mogens C. Bay, Age 47, President and Chief Executive Officer of the Company since August 1993 and Director of the Company since October 1993. From 1991 to August 1993 served as President and Chief Operating Officer of the Irrigation Division of the Company. Gary L. Cavey, Age 47, President and Chief Operating Officer, Industrial Products Division since June 1995. President, North American Operations - Industrial and Construction Products of the Company from July 1994 to June 1995. From 1985 to July 1994 served as Vice President Marketing of Industrial and Construction Products of the Company. Vincent T. Corso, Age 48, Vice President - Operations since June 1994. Previously served as Vice President - Corporate Manufacturing, Emerson Electric from 1992 to June 1994 and Vice President of Operations for Appleton Electric (a wholly owned subsidiary of Emerson Electric) from 1987 to 1992. Thomas P. Egan, Jr., Age 47, Vice President, Corporate Counsel and Secretary of the Company since 1984. Joseph M. Goecke, Age 58, President and Chief Operating Officer - Valmont Irrigation since August 1993. Vice President -Operations of the Company's Irrigation Division from 1991 to August 1993. Lewis P. Hays, Age 54, President, Valmont Europe since January 1996. Corporate Vice President from June 1995 until January 1996. President and Chief Operating Officer, Industrial and Construction Products of the Company from 1985 to June 1995. Terry J. McClain, Age 48, Vice President and Chief Financial Officer of the Company since January 1994. Vice President-Finance and Accounting of the Irrigation Division of the Company from 1990 to January 1994. E. Robert Meaney, Age 48, President and Chief Operating Officer - Valmont International since February 1994. Previously served as President Directeur General, Continental Can France, S.A. from 1989 to February 1994. Howard G. Sachs, Age 53, President and Chief Operating Officer - Valmont Electric, Inc. since October 1993. Previously Honeywell Keyboard Division Vice President and General Manager from 1991 to October 1993. Mark E. Treinen Age 40, Vice President - Business Development since January 1994. Director of Business Development of the Company from 1991 until January 1994. Brian C. Stanley, Age 53, Vice President - Investor Relations and Controller of the Company since January 1994. Vice President and Treasurer of the Company since 1990. Tom L. Whalen, Age 48, Vice President, Human Resources of the Company since 1982. 5 PART II Item 5. Market for the Registrant's Common Stock and Related Stockholder ------------------------------------------------------------------ Matters. ------- Item 6. Selected Financial Data. ------------------------ Item 7. Management's Discussion and Analysis of Financial Condition and --------------------------------------------------------------- Results of Operations --------------------- The information called for by items 5, 6 and 7 is hereby incorporated by reference to the following captioned paragraphs (at the pages indicated) in the Company's Annual Report: Page(s) In Annual Item Caption in Annual Report Report ---- ------------------------ ------ 5 Stock Trading Inside back cover 5 Stock Market Price and Dividends Declared 31 5 Approximate Number of Shareholders 18 - 19 5&6 Selected Eleven Year Financial Data 18 - 19 7 Management's Discussion and Analysis 12 - 17 Item 8. Financial Statements and Supplementary Data. -------------------------------------------- The financial statements called for by this item are hereby incorporated by reference to the Company's Annual Report as set forth on pages 20 through 30, together with the independent auditors' report on page 32. The supplemental quarterly financial information is incorporated herein by reference to page 31 of the Company's Annual Report. Item 9. Changes in and Disagreements with Accountants on Accounting and ------------------------------------------------------------------ Financial Disclosure. --------------------- The Company filed a Form 8-K dated February 28, 1996 reporting the change in its independent public accountants to Deloitte & Touche LLP from KPMG Peat Marwick LLP. The information in the 8-K report is incorporated herein by reference. PART III -------- Item 10. Directors and Executive Officers of the Registrant. --------------------------------------------------- Item 11. Executive Compensation. ----------------------- Item 12. Security Ownership of Certain Beneficial Owners and Management. --------------------------------------------------------------- Item 13. Certain Relationships and Related Transactions. ----------------------------------------------- Except for the information relating to the executive officers of the Company set forth in Part I of this 10-K Report, the information called for by items 10, 11, 12 and 13 is hereby incorporated by reference to pages 4 through 11 of the Company's Proxy Statement. 6 PART IV ------- Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K. ---------------------------------------------------------------- (a)(1)(2) Financial Statements. See index to financial statement --------------------- schedules on page F-2. (a)(3) Exhibits. See exhibit index, incorporated herein by reference. --------- (b) Reports on Form 8-K. The Company filed a Form 8-K dated -------------------- December 19, 1995 reporting the adoption of a Shareholder Rights Plan with the declaration of a dividend of one preferred share purchase right for each outstanding share of common stock, payable January 8, 1996 to stockholders of record on such date. The Company filed a Form 8-K dated February 28, 1996 reporting a change in the Company's independent public accountants. 7 VALMONT INDUSTRIES, INC. AND SUBSIDIARIES Consolidated Financial Statement Schedules Supporting Consolidated Financial Statements for Inclusion in Annual Report (Form 10-K) December 30, 1995, December 31, 1994 and December 25, 1993 (With Independent Auditors' Report Thereon) 8 INDEPENDENT AUDITORS' REPORT ---------------------------- The Board of Directors and Shareholders Valmont Industries, Inc.: Under date of February 16, 1996, we reported on the consolidated balance sheets of Valmont Industries, Inc. and subsidiaries as of December 30, 1995 and December 31, 1994, and the related consolidated statements of operations, shareholders' equity and cash flows for each of the years in the three-year period ended December 30, 1995, as contained in the 1995 Annual Report to Shareholders. These consolidated financial statements and our report thereon are incorporated by reference in the Annual Report on Form 10-K for the year 1995. In connection with our audits of the aforementioned consolidated financial statements, we also have audited the related supplementary notes and consolidated financial statement schedules as listed in the accompanying index. These supplementary notes and consolidated financial statement schedules are the responsibility of the Company's management. Our responsibility is to express an opinion on these supplementary notes and consolidated financial statement schedules based on our audits. In our opinion, such supplementary notes and consolidated financial statement schedules, when considered in relation to the consolidated financial statements taken as a whole, present fairly in all material respects the information set forth therein. As described in Note 1 to the consolidated financial statements, the Company adopted the provisions of the Statement of Financial Accounting Standards No. 109, Accounting for Income Taxes, in fiscal 1993. KPMG PEAT MARWICK LLP Omaha, Nebraska February 16, 1996 9 F-1 VALMONT INDUSTRIES, INC. AND SUBSIDIARIES Index to Consolidated Financial Statements and Consolidated Financial Statement Schedules Consolidated Financial Statements The following consolidated financial statements of Valmont Industries, Inc. and subsidiaries have been incorporated by reference to pages 20 to 30 of the Company's Annual Report to Shareholders for the year ended December 30, 1995: Independent Auditors' Report Consolidated Balance Sheets - December 30, 1995 and December 31, 1994 Consolidated Statements of Operations - Three-Year Period Ended December 30, 1995 Consolidated Statements of Shareholders' Equity - Three-Year Period Ended December 30, 1995 Consolidated Statements of Cash Flows - Three-Year Period Ended December 30, 1995 Notes to Consolidated Financial Statements - Three- Year Period Ended December 30, 1995 Page ---- Consolidated Financial Statement Schedules Supporting Consolidated Financial Statements SCHEDULE II - Valuation and Qualifying Accounts F-3 SCHEDULE XI - Statement Re: Computation of Per Share Earnings F-4 All other schedules have been omitted as the required information is inapplicable or the information is included in the consolidated financial statements or related notes. Separate financial statements of the Registrant have been omitted because the Registrant meets the requirements which permit omission. F-2 10 Schedule II VALMONT INDUSTRIES, INC. AND SUBSIDIARIES Valuation and Qualifying Accounts (Dollars in thousands) Balance at Charged to Deductions Balance at beginning profit and from close of period loss reserves* of period --------- ---- --------- --------- Fifty-two weeks ended December 30, 1995 - Reserve deducted in balance sheet from the asset to which it applies - Allowance for doubtful receivables $ 2,798 684 541 2,941 ===== ===== ===== ===== Fifty-three weeks ended December 31, 1994 - Reserve deducted in balance sheet from the asset to which it applies - Allowance for doubtful receivables $ 2,605 908 715 2,798 ======= ===== ===== ===== Fifty-two weeks ended December 25, 1993 - Reserve deducted in balance sheet from the asset to which it applies - Allowance for doubtful receivables $ 3,070 1,043 1,508 2,605 ======= ===== ===== ===== *The deductions from reserves are net of recoveries. F-3 11 Schedule XI VALMONT INDUSTRIES, INC. AND SUBSIDIARIES Statement Re: Computation of Per Share Earnings (Dollars in thousands, except per share amounts) 1995 1994 1993 ---- ---- ---- Net earnings $ 24,759 18,887 7,278 ======== ====== ===== Average number of shares outstanding: Primary 13,733,286 13,615,004 13,620,299 Fully diluted 13,815,191 13,628,950 13,644,828 ========== ========== ========== Earnings per share: Primary $ 1.80 1.39 0.53 Fully diluted 1.79 1.39 0.53 ====== ==== ==== Earnings per share are determined by dividing net earnings by the weighted number of shares outstanding and equivalent common shares from dilutive stock options. F-4 12 SIGNATURES The Registrant. Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Omaha, State of Nebraska, on the 22nd day of March, 1996. Valmont Industries, Inc. /S/Mogens C. Bay By ___________________________ Mogens C. Bay Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of Valmont Industries, Inc. and in the capacities indicated on the dates indicated. /S/ Mogens C. Bay March 22, 1996 - -------------------------- Director, President and -------------- Mogens C. Bay Chief Executive Officer Date (Principal Executive Officer) /S/ Terry J. McClain March 22, 1996 - -------------------------- Vice President and -------------- Terry J. McClain Chief Financial Officer Date (Principal Financial Officer) /S/ Brian C. Stanley March 22, 1996 - -------------------------- Vice President - Investor -------------- Brian C. Stanley Relations & Controller Date (Principal Accounting Officer) Robert B. Daugherty* John E. Jones* Charles M. Harper* Thomas F. Madison* Allen F. Jacobson* Walter Scott, Jr.* Lloyd P. Johnson* Robert G. Wallace* *Mogens C. Bay, by signing his name hereto, signs the Annual Report on behalf of each of the directors indicated on this 22nd day of March, 1996. A Power of Attorney authorizing Mogens C. Bay to sign the Annual Report of Form 10-K on behalf of each of the indicated directors of Valmont Industries, Inc. has been filed herein as Exhibit 24. /S/ Mogens C. Bay By ------------------------- Mogens C. Bay Attorney-in-Fact 13 INDEX TO EXHIBITS This Exhibit Index relates to exhibits filed as a part of this Report. Numbers are assigned to exhibits in accordance with Item 601 of Regulation S-K. Page numbers relate to the pages in the sequential numbering system where the exhibits can be found (for those exhibits which are not incorporated by reference). Exhibit 2 - Agreement and Plan of Merger dated July 9, 1995 among the Company and Microflect Company, Inc. This document was filed with the Company's Current Report on Form 8-K dated July 31, 1995 and is incorporated herein by reference. Exhibit 3(a) - The Company's Certificate of Incorporation, as amended. This document was filed with the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1994 and is incorporated herein by reference. Exhibit 3(b) - The Company's By-Laws, as amended. This document was filed with the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1995 and is incorporated herein by reference. Exhibit 4 - Rights Agreement dated as of December 19, 1995 between the Company and First National Bank of Omaha as Rights Agent. This document was filed with the Company's Current Report on Form 8-K dated December 19, 1995 and is incorporated herein by reference. Exhibit 10(a) - The Company's 1983 Stock Option Plan. This document was filed as Exhibit 10(a) to the Company's Annual Report on Form 10-K for the fiscal year ended December 26, 1992 and is incorporated herein by reference. Exhibit 10(b) - The Company's 1988 Stock Plan and certain amendments. This document was filed as Exhibit 10(b) to the Company's Annual Report on Form 10-K for the fiscal year ended December 26, 1992 and is incorporated herein by reference. Exhibit 10(c) - Fourth Amendment to the Company's 1988 Stock Plan.....Page 15 Exhibit 10(d) - Valmont Industries, Inc. 1994 Incentive Bonus Plan. This document was filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 24, 1994 and is incorporated herein by reference. Exhibit 10(e) - The Company's 1996 Stock Plan.........................Page 16 Exhibit 10(f) - The Valmont Executive Incentive Plan..................Page 26 Exhibit 11 - Statement re: Computation of Per Share Earnings included as Schedule XI of the Consolidated Supporting Schedules herein. Exhibit 13 - The Company's Annual Report to Shareholders for its fiscal year ended December 30, 1995...........Page 28 Exhibit 21 - Subsidiaries of the Company...........................Page 64 Exhibit 23 - Consent of KPMG Peat Marwick LLP......................Page 65 Exhibit 24 - Power of Attorney.....................................Page 66 Exhibit 27 - Financial Data Schedule...............................Page 67 Pursuant to Item 601(b)(4) of Regulation S-K, certain instruments with respect to Valmont Industries' long-term debt are not filed with this Form 10-K. Valmont will furnish a copy of such long-term debt agreements to the Securities and Exchange Commission upon request. Management contracts and compensatory plans are set forth as exhibits 10(a) through 10(f). 14

Exhibit 10(c) FOURTH AMENDMENT TO THE VALMONT 1988 STOCK PLAN The Valmont 1988 Stock Plan (as previously amended, the "Plan") is hereby further amended as follows: A. Section 3.3 is amended by adding the following sentences immediately preceding the last sentence of Section 3.3: In addition, each director who is not an Employee of the Company shall receive a non-discretionary award of a Nonqualified Stock Option for 2,000 shares of Company Stock exercisable at the closing price of the Company's common stock on the date of grant; such award shall be made (i) on the third business day following the public release by the Company of its quarterly earnings for the second quarter of fiscal 1995, and (ii) annually thereafter on the date of and following completion of the Company's annual stockholders' meeting (commencing with the 1996 annual stockholders' meeting). The number of nonqualified options awarded to a director shall be appropriately adjusted in the event of any stock changes as described in Article XI. B. This Fourth Amendment to the Plan shall be effective upon its approval by the stockholders of the Company, and any grant of Nonqualified Stock Options pursuant to the Fourth Amendment shall be expressly conditioned upon such stockholder approval. 15

Exhibit 10(e) VALMONT 1996 STOCK PLAN SECTION 1 NAME AND PURPOSE 1.1 Name. The name of the plan shall be the Valmont 1996 Stock Plan (the "Plan"). 1.2. Purpose of Plan. The purpose of the Plan is to foster and promote the long-term financial success of the Company and increase stockholder value by (a) motivating superior performance by means of stock incentives, (b) encouraging and providing for the acquisition of an ownership interest in the Company by Employees and (c) enabling the Company to attract and retain the services of a management team responsible for the long-term financial success of the Company. SECTION 2 DEFINITIONS 2.1 Definitions. Whenever used herein, the following terms shall have the respective meanings set forth below: (a) "Act" means the Securities Exchange Act of 1934, as amended. (b) "Award" means any Option, Stock Appreciation Right, Restricted Stock, Stock Bonus, or any combination thereof, including Awards combining two or more types of Awards in a single grant. (c) "Board" means the Board of Directors of the Company. (d) "Code" means the Internal Revenue Code of 1986, as amended. (e) "Committee" means the Compensation Committee of the Board, which shall consist of two or more members, each of whom shall be "disinterested persons" within the meaning of Rule 16b-3 as promulgated under the Act. (f) "Company" means Valmont Industries, Inc., a Delaware corporation (and any successor thereto) and its Subsidiaries. (g) "Director Award" means an award of Stock and an annual Award of a Nonstatutory Stock Option granted to each Eligible Director pursuant to Section 7.1 without any action by the Board or the Committee. 16 (h) "Eligible Director" means a person who is serving as a member of the Board and who is not an Employee. (i) "Employee" means any employee of the Company or any of its Subsidiaries. (j) "Fair Market Value" means, on any date, the average of the high and low sales prices of the Stock as reported on the National Association of Securities Dealers Automated Quotation system (or on such other recognized market or quotation system on which the trading prices of the Stock are traded or quoted at the relevant time) on such date. In the event that there are no Stock transactions reported on such system (or such other system) on such date, Fair Market Value shall mean the average of the high and low sale prices on the immediately preceding date on which Stock transactions were so reported. (k) "Option" means the right to purchase Stock at a stated price for a specified period of time. For purposes of the Plan, an Option may be either (i) an Incentive Stock Option within the meaning of Section 422 of the Code or (ii) a Nonstatutory Stock Option. (l) "Participant" means any Employee designated by the Committee to participate in the Plan. (m) "Plan" means the Valmont 1996 Stock Plan, as in effect from time to time. (n) "Restricted Stock" shall mean a share of Stock granted to a Participant subject to such restrictions as the Committee may determine. (o) "Stock" means the Common Stock of the Company, par value $1.00 per share. (p) "Stock Appreciation Right" means the right, subject to such terms and conditions as the Committee may determine, to receive an amount in cash or Stock, as determined by the Committee, equal to the excess of (i) the Fair Market Value, as of the date such Stock Appreciation Right is exercised, of the number shares of Stock covered by the Stock Appreciation Right being exercised over (ii) the aggregate exercise price of such Stock Appreciation Right. (q) "Stock Bonus" means the grant of Stock as compensation from the Company, which may be in lieu of cash salary or bonuses otherwise payable to the Participant or in addition to such cash compensation. 17 (r) "Subsidiary" means any corporation or partnership in which the Company owns, directly or indirectly, 50% or more of the total combined voting power of all classes of stock of such corporation or of the capital interest or profits interest of such partnership. 2.2 Gender and Number. Except when otherwise indicated by the context, words in the masculine gender used in the Plan shall include the feminine gender, the singular shall include the plural, and the plural shall include the singular. SECTION 3 ELIGIBILITY AND PARTICIPATION Except as otherwise provided in Section 7.1, the only persons eligible to participate in the Plan shall be those Employees selected by the Committee as Participants. SECTION 4 POWERS OF THE COMMITTEE 4.1 Power to Grant. The Committee shall determine the Participants to whom Awards shall be granted, the type or types of Awards to be granted, and the terms and conditions of any and all such Awards. The Committee may establish different terms and conditions for different types of Awards, for different Participants receiving the same type of Awards, and for the same Participant for each Award such Participant may receive, whether or not granted at different times. 4.2 Administration. The Committee shall be responsible for the administration of the Plan. The Committee, by majority action thereof, is authorized to prescribe, amend, and rescind rules and regulations relating to the Plan, to provide for conditions deemed necessary or advisable to protect the interests of the Company, and to make all other determinations necessary or advisable for the administration and interpretation of the Plan in order to carry out its provisions and purposes. Determinations, interpretations, or other actions made or taken by the Committee pursuant to the provisions of the Plan shall be final, binding, and conclusive for all purposes and upon all persons. Notwithstanding anything else contained in the Plan to the contrary, neither the Committee nor the Board shall have any discretion regarding whether an Eligible Director receives a Director Award pursuant to Section 7.1 or regarding the terms of any such Director Award, including, without limitation, the number of shares subject to any such Director Award. 18 SECTION 5 STOCK SUBJECT TO PLAN 5.1 Number. Subject to the provisions of Section 5.3, the number of shares of Stock subject to Awards (including Director Awards) under the Plan may not exceed 800,000 shares of Stock. The shares to be delivered under the Plan may consist, in whole or in part, of treasury Stock or authorized but unissued Stock, not reserved for any other purpose. The maximum number of shares of Stock with respect to which Awards may be granted to any one Employee under the Plan is 40% of the aggregate number of shares of Stock available for Awards under Section 5.1. 5.2 Cancelled, Terminated or Forfeited Awards. Any shares of Stock subject to an Award which for any reason are cancelled, terminated or otherwise settled without the issuance of any Stock shall again be available for Awards under the Plan. 5.3 Adjustment in Capitalization. In the event of any Stock dividend or Stock split, recapitalization (including, without limitation, the payment of an extraordinary dividend), merger, consolidation, combination, spin-off, distribution of assets to stockholders, exchange of shares, or other similar corporate change, (i) the aggregate number of shares of Stock available for Awards under Section 5.1 and (ii) the number of shares and exercise price with respect to Options and the number, prices and dollar value of other Awards, may be appropriately adjusted by the Committee, whose determination shall be conclusive. If, pursuant to the preceding sentence, an adjustment is made to the number of shares of Stock authorized for issuance under the Plan, a corresponding adjustment shall be made with respect to Director Awards granted pursuant to Section 7.1. SECTION 6 STOCK OPTIONS 6.1 Grant of Options. Options may be granted to Participants at such time or times as shall be determined by the Committee. Options granted under the Plan may be of two types: (i) Incentive Stock Options and (ii) Nonstatutory Stock Options. The Committee shall have complete discretion in determining the number of Options, if any, to be granted to a Participant. Each Option shall be evidenced by an Option agreement that shall specify the type of Option granted, the exercise price, the duration of the Option, the number of shares of Stock to which the Option pertains, the exercisability (if any) of the Option in the event of death, retirement, disability or termination of employment, and such other terms and conditions not inconsistent with the Plan as the Committee shall determine. 19 6.2 Option Price. Nonstatutory Stock Options and Incentive Stock Options granted pursuant to the Plan shall have an exercise price which is not less than the Fair Market Value on the date the Option is granted. 6.3 Exercise of Options. Options awarded to a Participant under the Plan shall be exercisable at such times and shall be subject to such restrictions and conditions as the Committee may impose, subject to the Committee's right to accelerate the exercisability of such Option in its discretion. Notwithstanding the foregoing, no Option shall be exercisable for more than ten years after the date on which it is granted. 6.4 Payment. The Committee shall establish procedures governing the exercise of Options, which shall require that written notice of exercise be given and that the Option price be paid in full in cash or cash equivalents, including by personal check, at the time of exercise or pursuant to any arrangement that the Committee shall approve. The Committee may, in its discretion, permit a Participant to make payment (i) in Stock already owned by the Participant valued at its Fair Market Value on the date of exercise (if such Stock has been owned by the Participant for at least six months) or (ii) by electing to have the Company retain Stock which would otherwise be issued on exercise of the Option, valued at its Fair Market Value on the date of exercise. As soon as practicable after receipt of a written exercise notice and full payment of the exercise price, the Company shall deliver to the Participant a certificate or certificates representing the acquired shares of Stock. 6.5 Incentive Stock Options. Notwithstanding anything in the Plan to the contrary, no term of this Plan relating to Incentive Stock Options shall be interpreted, amended or altered, nor shall any discretion or authority granted under the Plan be so exercised, so as to disqualify the Plan under Section 422 of the Code, or, without the consent of any Participant affected thereby, to cause any Incentive Stock Option previously granted to fail to qualify for the Federal income tax treatment afforded under Section 421 of the Code. In furtherance of the foregoing, (i) the aggregate Fair Market Value of shares of Stock (determined at the time of grant of each Option) with respect to which Incentive Stock Options are exercisable for the first time by an Employee during any calendar year shall not exceed $100,000 or such other amount as may be required by the Code, (ii) an Incentive Stock Option may not be exercised more than three months following termination of employment (except as the Committee may otherwise determine in the event of death or disability), and (iii) if the Employee receiving an Incentive Stock Option owns Stock possessing more than 10% of the total combined voting power of all classes of Stock of the Company, the exercise price of the Option shall be at least 110% of Fair Market Value and the Option shall not be exercisable after the expiration of five years from the date of grant. 20 6.6 Replacement Options. The Committee may grant a replacement option (a "Replacement Option") to any Employee who exercises all or part of an option granted under this Plan using Qualifying Stock (as herein defined) as payment for the purchase price. A Replacement Option shall grant to the Employee the right to purchase, at the Fair Market Value as of the date of said exercise and grant, the number of shares of stock equal to the sum of the number of whole shares (i) used by the Employee in payment of the purchase price for the option which was exercised and (ii) used by the Employee in connection with applicable withholding taxes on such transaction. A Replacement Option may not be exercised for six months following the date of grant, and shall expire on the same date as the option which it replaces. Qualifying Stock is stock which has been owned by the Employee for at least six months prior to the date of exercise and has not been used in a stock-for-stock swap transaction within the preceding six months. SECTION 7 DIRECTOR AWARDS 7.1 Amount of Award. Each Eligible Director shall receive a non-discretionary Award of 1,000 shares of stock each year; such Award shall be made annually on the date of and following completion of the Company's annual stockholders' meeting (commencing with the 1996 annual stockholders' meeting). Each Eligible Director shall be issued a common stock certificate for such number of shares. Termination of the director's services for any reason other than (i) death, (ii) retirement from the Board at mandatory retirement age, or (iii) resignation or failure to stand for re-election, in any such case with the prior approval of the Board, will result in forfeiture of the Stock. If the Stock is forfeited, the director shall return the number of forfeited shares of Stock, or equivalent value, to the Company. The number of shares of Stock awarded to an Eligible Director annually shall be appropriately adjusted in the event of any stock changes as described in Section 5.3. In addition, each Eligible Director shall receive a non-discretionary Award of a Nonqualified Stock Option for 2,000 shares of Stock exercisable at the Fair Market Value of the Company's common stock on the date of grant; such Award shall be made annually on the date of and following completion of the Company's annual stockholders' meeting (commencing with the 1996 annual stockholders' meeting). The number of nonqualified options awarded to a director shall be appropriately adjusted in the event of any stock changes as described in Section 5.3. 7.2 No Other Awards. An Eligible Director shall not receive any other Award under the Plan. 21 SECTION 8 STOCK APPRECIATION RIGHTS 8.1 SAR's In Tandem with Options. Stock Appreciation Rights may be granted to Participants in tandem with any Option granted under the Plan, either at or after the time of the grant of such Option, subject to such terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine. Each Stock Appreciation Right shall only be exercisable to the extent that the corresponding Option is exercisable, and shall terminate upon termination or exercise of the corresponding Option. Upon the exercise of any Stock Appreciation Right, the corresponding Option shall terminate. 8.2 Other Stock Appreciation Rights. Stock Appreciation Rights may also be granted to Participants separately from any Option, subject to such terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine. SECTION 9 RESTRICTED STOCK 9.1 Grant of Restricted Stock. The Committee may grant Restricted Stock to Participants at such times and in such amounts, and subject to such other terms and conditions not inconsistent with the Plan as it shall determine. Each grant of Restricted Stock shall be subject to such restrictions, which may relate to continued employment with the Company, performance of the Company, or other restrictions, as the Committee may determine. Each grant of Restricted Stock shall be evidenced by a written agreement setting forth the terms of such Award. 9.2 Removal of Restrictions. The Committee may accelerate or waive such restrictions in whole or in part at any time in its discretion. SECTION 10 STOCK BONUSES 10.1 Grant of Stock Bonuses. The Committee may grant a Stock Bonus to a Participant at such times and in such amounts, and subject to such other terms and conditions not inconsistent with the Plan, as it shall determine. 22 SECTION 11 AMENDMENT, MODIFICATION, AND TERMINATION OF PLAN 11.1 General. The Board may from time to time amend, modify or terminate any or all of the provisions of the Plan, subject to the provisions of this Section 11.1. The Board may not change the Plan in a manner which would prevent outstanding Incentive Stock Options granted under the Plan from being Incentive Stock Options without the consent of the optionees concerned. Furthermore, the Board may not make any amendment which would (i) materially modify the requirements for participation in the Plan, (ii) increase the number of shares of Stock subject to Awards under the Plan pursuant to Section 5.1, (iii) materially increase the benefits accruing to Participants under the Plan, or (iv) make any other amendments which would cause the Plan not to comply with Rule 16b- 3 under the Act, in each case without the approval of the Company's stockholders. No amendment or modification shall affect the rights of any Employee with respect to a previously granted Award, nor shall any amendment or modification affect the rights of any Eligible Director pursuant to a previously granted Director Award. 11.2 Termination of Plan. No further Options shall be granted under the Plan subsequent to December 31, 2005, or such earlier date as may be determined by the Board. SECTION 12 MISCELLANEOUS PROVISIONS 12.1 Nontransferability of Awards. No Awards granted under the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. All rights with respect to Awards granted to a Participant under the Plan shall be exercisable during the Participant's lifetime only by such Participant and all rights with respect to any Director Awards granted to an Eligible Director shall be exercisable during the Director's lifetime only by such Eligible Director. 12.2 Beneficiary Designation. Each Participant under the Plan may from time to time name any beneficiary or beneficiaries (who may be named contingent or successively) to whom any benefit under the Plan is to be paid or by whom any right under the Plan is to be exercised in case of his death. Each designation will revoke all prior designations by the same Participant shall be in a form prescribed by the Committee, and will be effective only when filed in writing with the Company. In the absence of any such designation, Awards outstanding at death may be exercised by the Participant's surviving spouse, if any, or otherwise by his estate. 23 12.3 No Guarantee of Employment or Participation. Nothing in the Plan shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate any Participant's employment at any time, nor confer upon any Participant any right to continue in the employ of the Company or any Subsidiary. No Employee shall have a right to be selected as a Participant, or, having been so selected, to receive any future Awards. 12.4 Tax Withholding. The Company shall have the power to withhold, or require a Participant or Eligible Director to remit to the Company, an amount sufficient to satisfy federal, state, and local withholding tax requirements on any Award under the Plan, and the Company may defer issuance of Stock until such requirements are satisfied. The Committee may, in its discretion, permit a Participant to elect, subject to such conditions as the Committee shall impose, (i) to have shares of Stock otherwise issuable under the Plan withheld by the Company or (ii) to deliver to the Company previously acquired shares of Stock, in each case having a Fair Market Value sufficient to satisfy all or part of the Participant's estimated total federal, state and local tax obligation associated with the transaction. 12.5 Change of Control. On the date of a Change of Control, all outstanding options and stock appreciation rights shall become immediately exercisable and all restrictions with respect to Restricted Stock shall lapse. "Change of Control" shall mean: (i) The acquisition (other than from the Company) by any person, entity or "group", within the meaning of Section 13(d)(3) or 14(d)(2) of the Act (excluding any acquisition or holding by (i) the Company or its subsidiaries, (ii) any employee benefit plan of the Company or its subsidiaries which acquires beneficial ownership of voting securities of the Company and (iii) Robert B. Daugherty, his successors and assigns and any tax-exempt entity established by him) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Act) of 50% or more of either the then outstanding shares of common stock or the combined voting power of the Company's then outstanding voting securities entitled to vote generally in the election of directors; or (ii) Individuals who, as of the date hereof, constitute the Board (as of the date hereof the "Incumbent Board") cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director subsequent to the date hereof whose election, or nomination for the election by the Company's stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be, for purposes of this Plan, considered as though such person were a member of the Incumbent Board; or 24 (iii) Approval by the stockholders of the Company of a reorganization, merger or consolidation, in each case, with respect to which persons who were the stockholders of the Company immediately prior to such reorganization, merger or consolidation do not, immediately thereafter, own more than 50% of the combined voting power entitled to vote generally in the election of directors of the reorganized, merged or consolidated company's then outstanding voting securities, or a liquidation or dissolution of the Company or of the sale of all or substantially all of the assets of the Company. 12.6 Company Intent. The Company intends that the Plan comply in all respects with Rule 16b-3 under the Act, and any ambiguities or inconsistencies in the construction of the Plan shall be interpreted to give effect to such intention. 12.7 Requirements of Law. The granting of Awards and the issuance of shares of Stock shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or securities exchanges as may be required. 12.8 Effective Date. The Plan shall be effective upon its adoption by the Board subject to approval by the Company's stockholders at the 1996 annual stockholders' meeting. 12.9 Governing Law. The Plan, and all agreements hereunder, shall be construed in accordance with and governed by the laws of the State of Delaware. 25

Exhibit 10(f) VALMONT EXECUTIVE INCENTIVE PLAN 1. Purpose. The principal purpose of the Valmont Industries, Inc. Executive Incentive Plan (the "Plan") is to provide incentives to executive officers of Valmont ("Valmont") who have significant responsibility for the success and growth of Valmont and to assist Valmont in attracting, motivating and retaining executive officers on a competitive basis. 2. Administration of the Plan. The Plan shall be administered by the Compensation Committee of the Board of Directors (the "Committee"). The Committee shall have the sole discretion to interpret the Plan; approve a pre-established objective performance measure or measures annually; certify the level to which each performance measure was attained prior to any payment under the Plan; approve the amount of awards made under the Plan; and determine who shall receive any payment under the Plan. The Committee shall have full power and authority to administer and interpret the Plan and to adopt such rules, regulations and guidelines for the administration of the Plan and for the conduct of its business as the Committee deems necessary or advisable. The Committee's interpretations of the Plan, and all actions taken and determinations made by the Committee pursuant to the powers vested in it hereunder, shall be conclusive and binding on all parties concerned, including Valmont, its stockholders and any person receiving an award under the Plan. 3. Eligibility. Executive officers and other key management personnel of Valmont shall be eligible to receive awards under the Plan. The Committee shall designate the executive officers and other key management personnel who will participate in the Plan each year. 4. Awards. The Committee shall establish annual and/or long-term incentive award targets for participants. If an individual becomes an executive officer during the year, such individual may be granted eligibility for an incentive award for that year upon such individual becoming an executive officer. The Committee shall also establish annual and/or long-term performance targets which must be achieved in order for an award to be earned under the Plan. Such targets shall be based on earnings, earnings per share, growth in earnings per share, achievement of annual operating profit plans, return on equity performance, or similar financial performance measures as may be determined by the Committee. The specific performance targets for each participant shall be established in writing by the Committee within ninety days after the commencement of the fiscal year (or within such other time period as may be required by Section 162(m) of the Internal Revenue Code) to which the performance target relates. The performance target shall be established in such a manner than a third party having knowledge of the relevant facts could determine whether the performance goal has been met. 26 Awards shall be payable following the completion of the applicable fiscal year upon certification by the Committee that Valmont achieved the specified performance target established for the participant. Notwithstanding the attainment by Valmont of the specified performance targets, the Committee has the discretion, for each participant, to reduce some or all of an award that would otherwise be paid. However, in no event may a participant receive an award of more than 400% of such participant's base salary under the Plan in any fiscal year; for this purpose, a participant's base salary shall be the base salary in effect at the time the Committee establishes the performance targets for a fiscal year or period. 5. Miscellaneous Provisions. Valmont shall have the right to deduct from all awards hereunder paid in cash any federal, state, local or foreign taxes required by law to be withheld with respect to such awards. Neither the Plan nor any action taken hereunder shall be construed as giving any employee any right to be retained in the employ of Valmont. The costs and expenses of administering the Plan shall be borne by Valmont and shall not be charged to any award or to any participant receiving an award. 6. Effective Date, Amendments and Termination. The Plan shall become effective on December 19, 1995 subject to approval by the stockholders of Valmont at the 1996 Annual Meeting of Stockholders. The Committee may at any time terminate or from time to time amend the Plan in whole or in part, but no such action shall adversely affect any rights or obligations with respect to any awards theretofore made under the Plan. However, unless the stockholders of Valmont shall have first approved thereof, no amendment of the Plan shall be effective which would increase the maximum amount which can be paid to any one executive officer under the Plan in any fiscal year, which would change the specified performance goals for payment of awards, or which would modify the requirement as to eligibility for participation in the Plan. 27

CONTENTS Exhibit 13 THE FIRST FIFTY YEARS This year marks the 50th anniversary of the founding of Valmont Industries. Following World War II, a former Marine named Robert B. Daugherty took his life savings and started a small farm equipment manufacturing company just west of Omaha. The company soon began to grow and prosper, adding new products and developing innovative manufacturing techniques. Through the years, Valmont has taken new ideas and turned them into products that meet the growing needs of its customers. The most revolutionary of these ideas was the center pivot irrigation system, a mechanized system to irrigate crops that forever changed agriculture. From this small acorn, a mighty oak has grown. Because the center pivot required a great deal of pipe, the Company began to manufacture its own. This, in turn, led Valmont into the tapered pole business, which now supports markets in lighting, traffic signals, electrical transmission and distribution, and wireless communication. Today, Valmont sells its mechanized irrigation systems and engineered metal structures across the United States and around the world. During its first five decades, the Company continuously sought the best ways to apply advancing technology to products and processes alike. And, at each step along the way, it was Valmont's people that made the difference . . . a team of smart, hard working pioneers in the truest sense of the word . . . dedicated to helping improve life around the globe. 4 LETTER TO SHAREHOLDERS 6 ABOUT VALMONT 6 Industrial Products 8 Irrigation Products 10 International 12 FINANCIAL REVIEW 12 Management's Discussion and Analysis 18 Selected Eleven-Year Financial Data 20 Consolidated Statements of Operations 21 Consolidated Balance Sheets 22 Consolidated Statements of Cash Flows 23 Consolidated Statements of Shareholders' Equity 24 Notes to Consolidated Financial Statements 30 Business Segment Information 31 Quarterly Financial Data 32 Independent Auditors' Report 33 Management's Report 34 Directors and Officers 28

1995 ANNUAL REPORT 1 VALMONT'S GLOBAL MARKETS FINANCIAL HIGHLIGHTS Valmont Industries, Inc. - ------------------------------------------------------------------------------- (Dollar amounts in millions, except per share data. Amounts and graphs are from continuing operations, before 1993 restructuring charge.) 1995 1994 1993 - ------------------------------------------------------------------------------ OPERATING RESULTS Net sales $ 544.6 501.7 464.3 Net earnings 24.8 18.9 14.7 Earnings per share 1.80 1.39 1.07 Dividends per share .30 .30 .29 FINANCIAL POSITION Shareholders' equity $ 159.3 137.6 121.8 Shareholders' equity per share 11.74 10.20 9.03 Long-term debt as a % of invested capital 17.3% 22.4% 24.7% OPERATING RATIOS Gross profit as a % of sales 26.6% 24.2% 23.6% Operating income as a % of sales 7.7% 6.3% 6.0% Net earnings as a % of sales 4.5% 3.8% 3.2% Return on beginning equity 18.0% 15.5% 12.4% YEAR END DATA Shares outstanding (000) 13,560 13,495 13,486 Approximate number of shareholders 3,900 3,800 3,800 Number of employees 4,166 3,946 4,152 (GRAPH) (GRAPH) (GRAPH) (GRAPH) 29

1995 ANNUAL REPORT 2 GROWING GLOBAL MARKETS - -------------------------------------------------------------------------------- Shanghai, China (MAP) CORPORATE HEADQUARTERS Valley, Nebraska USA Brenham, Texas, USA El Paso, Texas, USA Elkhart, Indiana, USA Juarez, Mexico Salem, Oregon, USA A World Leader... We aggressively participate in specific markets within two major global economies: Food Production and Infrastructure Development. First, we are the world leader in manufacturing EFFICIENT IRRIGATION EQUIPMENT for agriculture...increasing crop yields and conserving scarce water resources. Second, we are the world's leading producer of ENGINEERED METAL STRUCTURES and 30

VALMONT INDUSTRIES 3 (MAP) - -------------------------------------------------------------------------------- Salt Lake City, Utah, USA St. Hubert, Quebec, Canada Tulsa, Oklahoma, USA Valley, Nebraska, USA Charmeil, France Cusset, France Lempdes, France Maarheeze, The Netherlands Madrid, Spain Rive-de-Gier, France provide other products and components to various industries including communication, lighting, and utility...improving the world's infrastructure. In the future, we will grow by leveraging our strengths. We will take new products and technologies into existing markets and leverage our current products and technologies in new markets. This is how we plan to create value for all Valmont shareholders. 31

1995 ANNUAL REPORT 4 LETTER TO SHAREHOLDERS - -------------------------------------------------------------------------------- RECORD YEAR 1995 was a record year. Net earnings hit an all-time high of $24.8 million, topping 1994 earnings by 31.1%. Earnings per share were $1.80, also a Valmont record. Sales for the year climbed to $545 million, an 8.6% increase over the previous year. STICKING TO BASICS 1995 was a year in which our business strategy was further focused and refined. Valmont operates inside two world economies: infrastructure development and food production. Within these very large economies, we have carved out leadership positions in specific markets. In infrastructure development, we have focused our efforts on highly engineered structures that are used in a wide variety of applications. We are the single, largest worldwide supplier with a full product line. We design and produce steel and aluminum poles for use in lighting, traffic signals and signs, as well as transmission and distribution of electrical power. We also have established a significant presence by producing metal poles and towers for the wireless communication industry. These markets will continue to expand as the industrialized world upgrades its infrastructure and emerging countries develop theirs. Within food production, our focus is on mechanized irrigation for agriculture. Over the next 35 years, the world must more than double its food production to satisfy the need for better diets for a growing global population. In meeting this major global challenge, there are two primary issues that must be resolved: crop yields and effective management of limited fresh water supplies. For the producer, these are very real challenges; for Valmont, they represent the markets of tomorrow. Our center pivot and linear move irrigation systems provide solutions for these issues. INDUSTRIAL PRODUCTS The industrial products segment reported a 52.0% increase in operating income, from $23.6 million in 1994 to $35.9 million in 1995, on a 13.1% increase in revenues. The strongest revenue gains came from the sale of metal poles to the lighting markets in Europe and North America and products for the wireless communication markets in the United States. Operating income grew as a result of this volume increase and excellent cost reductions and productivity improvements in our ballast operations. During 1995, we acquired the Microflect Company of Salem, Oregon. Because we had already created an important market position in the fast growing communication market, we felt this acquisition would be a perfect fit...and it is. Microflect brought additional high-quality product lines, such as towers and components, which complemented our existing products. We are extremely pleased Microflect is a part of the Valmont team. To meet growing demand for our engineered poles and towers, we substantially increased our manufacturing capacity in North America and Europe during 1995 and made our first investment in Asia with the construction of a new plant in Shanghai, China. We selected China because it is the largest and fastest growing economy in Asia. A key to doing well in China is "staying power" and a total commitment to success. We have made that commitment and we believe China represents an excellent long-term investment with tremendous potential. ROBERT B. DAUGHERTY MOGENS C. BAY - ------------------- " We will remain focused on what we do best not only in our day-to-day operations but also in our approach to growing the business. " 32

VALMONT INDUSTRIES 5 While we are still not satisfied with the returns on our investment in the ballast operation, we are delighted with the improvements made in 1995. We focused on quality, manufacturing techniques that resulted in this business now operating at a profit. The future demand for our engineered poles and structures looks excellent in the U.S. and solid overseas. Lifestyles continue to improve around the world. Safety and quality of life upgrades remain a top priority for governments and the people they serve. We believe these trends will continue well into the future. (PICTURE) IRRIGATION PRODUCTS Operating income in this segment was up 5.6% for the year. Sales finished about equal to 1994's record performance in spite of a very wet spring and early summer in North America. Stronger international sales nearly made up for the shortfall in North America. Valmont has been the leader in mechanized irrigation for agriculture for over 40 years. We have set the industry standard and will continue to do so as we move into the next century. To meet the world's food production requirements in the years ahead, growers must use limited water resources very efficiently. Water conservation and the need to eliminate contaminating runoff will cause producers to practice "precision farming," the practice of applying water and chemicals only where and when needed. We intend to be a major player in the development and introduction of this technology to irrigated agriculture. Our mechanized irrigation systems can also increase crop yields, reduce labor costs and energy consumption, and are environmentally sensitive. It is not uncommon for a grower to see a complete payback on the cost of a new center pivot irrigation system in two to three growing seasons. The conversion from less efficient forms of irrigation to center pivots continues to grow as does the replacement of older systems that were installed 15-20 years ago. The outlook for U. S. and world agriculture is good. Feed grain inventories are at an all time low. Demand for farm products remains high and is accelerating as people around the world improve their diets....a situation not likely to change for some time. STAYING FOCUSED We will remain focused on what we do best not only in our day-to-day operations but also in our approach to growing the business. We will leverage technology we know and understand into new markets or we will expand present markets by bringing in new technology. We see ample opportunities to expand our businesses in North America and, over time, we expect our investments around the world to further accelerate our growth. Looking toward the future, the drivers for our core businesses remain strong. This, together with our significant investments in our people, production equipment, and manufacturing processes, should enable us to continue our progress in 1996. Our performance is the direct result of the skills and dedication of each member of the Valmont team and we thank them for their contributions to our Company. /s/ Mogens C. Bay - -------------------------------------- Mogens C. Bay President and Chief Executive Officer /s/ Robert B. Daugherty - -------------------------------------- Robert B. Daugherty Chairman of the Board 33

1995 ANNUAL REPORT 6 INDUSTRIAL PRODUCTS - -------------------------------------------------------------------------------- RECORD SALES Valmont designs and manufactures quality engineered metal structures and other fabricated products with high performance coatings for a wide range of industrial and commercial applications. The success of this business unit is built upon its commitment to top quality production through the use of the latest engineering and manufacturing technology. From its automated high-speed production equipment to its computer-linked distribution network, the Valmont team has the talent and skill necessary to satisfy the most demanding customer requirements. The customer is always the top priority and, whether the order is for standard or a custom-designed product, Valmont is committed to just-in-time delivery of properly designed, quality products. COMMUNICATION TOWERS The rapidly growing use of cellular phones, together with other forms of wireless communication, has created one of Valmont's most exciting opportunities. At the end of 1995, it was estimated that cellular companies were adding new subscribers at the rate of over 30,000 each day... which translates into a growing demand for new communication towers. This business is expected to continue to be Valmont's fastest growing product line. The 1995 acquisition of Microflect means Valmont has become a single-source supplier for communication structures, passive repeaters, wave guide supporting systems, components, installation, engineering, technical services, and maintenance. Internationally, the Company recently purchased a majority interest in Telec Centre, a small French manufacturer of communication towers, which will position Valmont to expand in the European segment of the market. LIGHTING AND TRAFFIC SIGNAL STRUCTURES Valmont is a leading manufacturer of pole structures for lighting and traffic signal standards. Sales are divided between public infrastructure development and private spending for a wide variety of outdoor lighting applications. Manufacturing and engineering flexibility to meet precise specifications and delivery deadlines are the keys to Valmont's success in all of its product lines. The outlook for lighting and traffic signal structures continues favorable. New construction and redevelopment of cities and highways remain among the most important demand factors. Crime prevention and the growing need for safe and secure outdoor areas are also important contributors to the increase in demand. (PICTURE) Infrastructure development continues at a rapid rate across the United States. Each day over 30,000 people are starting cellular phone service. Engineered poles and towers are absolutely essential in these markets... markets in which Valmont stands as the only worldwide integrated manufacturer. 34

VALMONT INDUSTRIES 7 Top left: A busy test bench at Valmont Electric helps ensure quality ballast products. Far left, left, and below: Traffic signal, electrical transmission, and wireless communication poles are just a few of the many Valmont products used to improve and modernize the nation's infrastructure. Right: Aluminum reflector panels on passive repeaters must meet rigid flatness tolerances required for microwave frequencies. (GRAPH) (GRAPH) (PICTURES) UTILITY PRODUCTS Growth in the utility pole structures market is expected to come from increased distribution and consumption of electric energy, replacement of wooden and metal lattice structures, and deregulation of the utility industry. Valmont's tapered steel transmission monopole designs offer better appearance, greater reliability, and more efficient use of space. At the same time, approximately 3% of the smaller wooden distribution poles found along most city streets are being replaced each year...which amounts to in excess of two and a half million poles annually. This represents potentially large demand as utilities begin to replace a portion of their wooden poles with metal ones. Valmont also serves the utility industry by producing components for the electrical sub-station market. OTHER PRODUCTS Ballasts - Valmont Electric produces a broad line of magnetic and electronic ballasts for the fluorescent lighting industry. During the past several years, this business unit has been repositioned to be one of the lowest-cost producers in the industry and it has focused its resources on new technology, high quality production and profitable niche markets. Newer, more reliable, cost-efficient electronic models are the growth vehicles for the lighting ballast industry. Sales of electronic ballasts are expected to continue to grow rapidly. Custom Tubing - Valmont designs and manufactures to customer specification a wide variety of shapes and sizes of tubular steel. Its custom tubing products are used in a number of automotive, industrial and agricultural products, including such diverse items as automotive starter motor housings, fire extinguishers, and grain spouting. The Company's extensive manufacturing capabilities allow just-in-time deliveries of custom-engineered products. Fasteners, Grating, and Pressure Vessels - Valmont produces and distributes a full line of fasteners, including mechanically galvanized screws, bolts, washers, and springs. In addition, the Company offers a full complement of hardware and accessories for towers, including fasteners, safety climb equipment, lighting kits, beacon mounts and grounding kits. Valmont's metal grating and fiberglass hand rails can be found in such diverse structures as water treatment plants, paper mills, and oil wells on Alaska's North Slope. The Company also produces pressure vessels for use in petroleum and chemical processes. These products support Valmont's major product lines and meet the total needs of its customers from initial order to complete installation and follow-up. 35

1995 ANNUAL REPORT 8 Below: Center pivot systems deliver a uniform application of water, chemicals and fertilizer in the exact quantities needed. Right: By placing spray nozzles close to the crop, evaporation is greatly reduced. Far right: Corner systems allow irrigation of square, rectangular and odd shaped fields. Bottom right: Automated controls assist growers with precise application and help reduce labor and energy costs. IRRIGATION PRODUCTS - -------------------------------------------------------------------------------- INDUSTRY LEADER Through the years, Valmont has built and supported the most extensive dealer network in the irrigation industry. Valmont offers extensive training on a continuous basis for its dealers who, in turn, provide world-class service in the form of system design, installation, and replacement parts. It is Valmont's dealer network and distribution system that has helped make the Company the industry leader. Valmont pioneered the development of large-scale mechanized agricultural irrigation equipment and today remains the worldwide industry leader. The use of irrigation was initially begun as a means to increase the amount of land available for food production and to increase crop yields from that land. Surface or gravity flow methods of irrigation that simply flood the fields became the predominant means of irrigation. Later, center pivot and linear move irrigation systems were introduced that use less water, produce more consistent yields and retain the chemicals in the root zone. [PICTURES] [GRAPH] 36

VALMONT INDUSTRIES 9 "VALLEY...THE MOST TRUSTED NAME IN IRRIGATION"(TM) Today the emphasis in agriculture is on water conservation and water quality while continuing to increase crop yields. Mechanized irrigation systems, such as the center pivots and linear move systems manufactured by Valmont, offer growers both economic and environmental benefits. Computerized controls and precise water application enable mechanized irrigation systems to reduce water usage by as much as 50% compared with field flooding. The systems can be programmed to deliver the exact amount of water needed on a timely basis, which eliminates excess water runoff and improves crop yields. Valmont's systems can also be operated by a computer from the grower's home or other remote location, thus reducing time and labor costs. Long-term demand for irrigation systems in the U.S. is also impacted by replacement of older systems. Many systems were installed during the 1970s and are nearing the time when they will need replacing. With the economical, environmental, and technological benefits of the newer systems as an added incentive, it is expected that many growers will replace their older systems during the next five to ten years. [PICTURES] Just 2% of the world's water supply is fresh water available for human use. Of the total fresh water available, agriculture uses about 65%. Valmont's mechanized irrigation systems efficiently use this water and are the solution to meeting the growing demand for increased food production, which must double over the next 35 years. Center pivot and linear move systems conserve precious water, increase crop yields and reduce chemical runoff. 37

1995 ANNUAL REPORT 10 INTERNATIONAL - -------------------------------------------------------------------------------- GLOBAL GROWTH Valmont sells full lines of engineered metal pole structures and mechanized irrigation systems in countries that span the globe. The Company has pole manufacturing facilities located in France, The Netherlands, Canada and China, an irrigation plant in Spain, and a ballast production plant in Mexico. The breadth of its sales networks and the geographic coverage of its manufacturing facilities are two key strengths of the Company's international business. IRRIGATION SYSTEMS Most of the factors affecting demand for irrigation systems in the U.S. are also present on a worldwide basis. As diets improve around the world, food production must increase to satisfy growing demand. At the same time, water available for agricultural irrigation is in short supply. It is estimated that about 2% of the world's water is fresh water. Of this amount, 65% is used in agriculture with about two-thirds of that wasted due to inefficient flood irrigation techniques. The combination of increased need for food supplies and demand for water conservation has created attractive worldwide long-term growth opportunities for Valmont's irrigation systems. Major agricultural areas in South America, Australia, Europe, Africa and Asia are possible growth areas for modern irrigation systems. These areas of opportunity are potential additions to the over 10 million acres that are now irrigated by Valmont mechanized irrigation systems in the U.S. and some 90 other countries around the world. 38

VALMONT INDUSTRIES 11 Left: The Singapore skyline is framed by one of Valmont's decorative poles made in France. Bottom left: Valmont lighting poles line a street in downtown Shanghai, China. Right: Linear move systems can irrigate rectangular fields from 10 to 1,000 acres. Lower right: The new China plant, completed in December, is producing tapered poles for lighting. [PICTURE] ENGINEERED METAL STRUCTURES The worldwide demand for lighting standards remains strong throughout world markets. Infrastructure development, road construction and commercial expansion in both developed and developing countries are creating excellent demand for a wide variety of pole structures. Valmont's strategy for developing markets has been consistent for many years. Marketing and engineering people initially serve the market. Then, manufacturing facilities and distribution channels are established throughout the region. This focused process has been highly successful in North America because it ensures the timely delivery of quality products and superior customer service. In Europe, Valmont entered the lighting market during 1989 and is now growing into the utility and communication structures areas. The Company has expanded its market to include many other countries while, at the same time, adding a manufacturing facility in the Netherlands and increasing capacity in France. The same approach is working in Asia. Valmont initially supplied these new markets from the United States and existing French facilities. By the time the Shanghai manufacturing plant was completed in China in late 1995, four sales offices were already open in the region...at Beijing, Guangzhou, Qingdao, and Shanghai. Additional facilities are planned in the next several years. The opportunities in Asia are tremendous as large numbers of people increase their standard of living and the region's economy expands. Diverse customer requirements for irrigation systems and engineered metal structures are promptly satisfied through Valmont's worldwide sales and distribution networks and its manufacturing facilities located in seven countries. 39

1995 ANNUAL REPORT 12 MANAGEMENT'S DISCUSSION AND ANALYSIS Valmont Industries, Inc. - -------------------------------------------------------------------------------- FINANCIAL REVIEW The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of the Company's consolidated results of operations and financial condition. This discussion should be read in conjunction with the Consolidated Financial Statements and related Notes. The Company acquired Microflect Company, Inc. (Microflect) on July 31, 1995. This acquisition was accounted for as a pooling of interests and accordingly, all financial results included in this annual report have been restated to reflect the combined operations of the companies. Microflect designs, fabricates and installs microwave communication antenna support structures, passive repeaters and waveguide support systems. FISCAL 1995 COMPARED TO FISCAL 1994 (Dollars in thousands, except per share amounts) 1995 CHANGE 1994 - -------------------------------------------------------------------------------------------------- Net sales $544,642 8.6 % $501,740 Cost of sales 399,691 5.1 % 380,254 Gross profit 144,951 19.3 % 121,486 Selling, general and administrative expenses 103,120 14.8 % 89,807 Operating income 41,831 32.0 % 31,679 Interest expense, net 3,511 (8.4)% 3,832 Miscellaneous income 139 (91.9)% 1,723 Income tax expense 13,700 28.2 % 10,683 Net earnings 24,759 31.1 % 18,887 Earnings per share 1.80 29.5 % 1.39 Valmont's net sales in 1995 increased $42.9 million over its sales for 1994. Industrial products segment revenues rose 13.1% primarily as a result of strong sales growth of pole and tower structures to the U.S. communications markets and the lighting markets in the United States, Canada, and Europe. Structures for the wireless communication market was the fastest growing product line with the acquisition of Microflect substantially improving the Company's position in this expanding market. The ballast business experienced sales similar to 1994 sales. Irrigation products segment sales declined slightly to $162.7 million in 1995 from $164.0 million as unfavorable weather conditions during the spring and summer in the U.S. markets slowed demand. Sales to international markets, primarily Europe, South America and Africa, rose to offset much of the domestic market decline. Gross profit increased $23.5 million in 1995 to $145.0 million, and as a percent of sales increased from 40

VALMONT INDUSTRIES 13 - -------------------------------------------------------------------------------- 24.2% in 1994 to 26.6% in 1995. The Irrigation Products segment gross profit increased despite lower sales as a result of productivity improvements and lower steel prices. Industrial Products segment gross profit also increased from sales increases in engineered metal structures and productivity increases in the ballast operation. A shift in the mix of products sold also impacted gross profit as a percent of sales. Selling, general and administrative (SG&A) expenses in 1995 were $103.1 million compared to $89.8 million in 1994. In 1995, SG&A as a percent of gross profit was 71.1% compared to the prior year's 73.9%. The SG&A expense increase was to support the sales volume growth, for incentive accruals and for the development of various international markets to foster future sales. For 1995 and 1994, net interest expense was $3.5 million and $3.8 million, respectively. The decrease results from lower debt levels and lower interest rates on variable rate debt. At the end of 1995, long-term debt had decreased by $6.8 million from the debt level at 1994 year-end. Miscellaneous income of $1.7 million in 1994 decreased to $0.1 million in 1995. The figure for 1994 included non-recurring gains from the sale and disposal of excess property of $1.2 million. In 1995, the effective tax rate of 35.6% decreased from the 1994 effective rate of 36.1% primarily due to reduced state income taxes as a result of relocation of businesses to states with lower tax rates and state tax incentives. For the reasons discussed above, the Company's earnings in 1995 were $24.8 million compared to $18.9 million for 1994. Earnings per share increased $0.41 per share in 1995 to $1.80 per share. (GRAPH) (GRAPH) (GRAPH) 41

1995 ANNUAL REPORT 14 MANAGEMENT'S DISCUSSION AND ANALYSIS CONTINUED Valmont Industries, Inc. - -------------------------------------------------------------------------------- FISCAL 1994 COMPARED TO 1993 (Dollars in thousands, except per share amounts) 1994 CHANGE 1993 - -------------------------------------------------------------------------------- Net sales $501,740 8.1 % $464,274 Cost of sales 380,254 7.3 % 354,502 Gross profit 121,486 10.7 % 109,772 Selling, general and administrative expenses 89,807 9.5 % 82,043 Restructuring charge - - 10,961 Operating income 31,679 88.9 % 16,768 Interest expense, net 3,832 24.9)% 5,105 Miscellaneous income 1,723 724.4 % 209 Income tax expense 10,683 147.2 % 4,321 Earnings from continuing operations 18,887 150.1 % 7,551 Earnings from discontinued operations - - 4,637 Cumulative effect of accounting change - - (4,910) Net earnings 18,887 159.5 % 7,278 Earnings per share 1.39 162.3 % .53 Net sales in 1994 increased $37.5 million over 1993 sales. Sales for the Industrial Products segment increased 2.2% in 1994 to $337.8 million from $330.4 million in 1993. The Industrial Products segment reported significant sales growth for United States and Canadian engineered metal structures. These sales gains, to a great extent, were offset by the absence of sales from the steel reinforcing bar operations exited in 1993 and divestiture of the cathodic protection operation. Sales in the ballast product line were managed lower for margin improvement. European metal structure sales in 1994 were slightly higher than the levels attained in 1993 as economic conditions in Europe improved in the second half of 1994. Sales for the Irrigation Products segment for 1994 of $164.0 million were up 22.2% over 1993, as record (graph) (graph) (graph) - ------------------------------------------------------------------------------- 42

VALMONT INDUSTRIES 15 - -------------------------------------------------------------------------------- North American sales more than offset weaker export shipments. Improved demand was driven by an increased focus on water conservation and replacement of older center pivots. Sales to the international markets for 1994 declined mainly from the reduction of sales to the Saudi Arabian market and the absence in 1994 of large project shipments. Gross profit improved $11.7 million in 1994 over 1993's performance, as sales volume increased. As a percent of sales, gross profit was 24.2% for 1994 compared to 23.6% in 1993. For the year 1994, gross profit improved in the engineered metal structures businesses compared to 1993 as a result of operating improvements. The lighting ballast product line and the Irrigation Products segment experienced lower gross profit percentages due to lower market prices in the last half of 1994. As a percent of gross profit, SG&A was 73.9% in 1994 compared to 74.7% in 1993. The increase in SG&A of $7.8 million in 1994 over 1993 resulted from increased sales commissions and incentives and expanded marketing efforts internationally. Operating income for 1993 was reduced by a restructuring charge of $11.0 million incurred for moving the lighting ballast product line operation from Illinois to Texas. Net interest expense decreased in 1994 by $1.3 million as a result of lower debt levels and lower interest rates on variable rate debt. The miscellaneous caption of other income (deductions) in the consolidated statements of operations contains gains and losses which were of an unusual or infrequent nature. Included in the $1.7 million in 1994 were gains of $1.2 million from the sale and disposal of excess property. The effective tax rate of 36.1% for 1994 was lower than the 36.4% effective tax rate of 1993 due to increased nontaxable interest income and foreign sales corporation tax benefits. As a result of the aforementioned operating factors and general business conditions, earnings from continuing operations increased by $11.3 million in 1994 over 1993 levels. Earnings per share from continuing operations were $1.39 for 1994 and $0.55 for 1993. For the year 1993, the Company reported earnings from discontinued operations of $4.6 million or $0.34 per share and an accounting charge of $4.9 million or $0.36 per share. As a result, the Company's 1993 net earnings of $7.3 million or $0.53 per share differed from its earnings from continuing operations. LIQUIDITY AND CAPITAL RESOURCES Net working capital of $81.0 million at the end of 1995 was less than the $88.3 million of working capital at the end of 1994. The net change results from using cash and cash equivalents to fund additions to property, plant, and equipment and principal payments on long-term debt. As a result, the ratio of current assets to current liabilities was 1.8:1 at the end of 1995 compared to 1.9:1 at the end of 1994. Available short-term credit facilities through bank lines of credit were $54.6 million at the end of 1995 compared to $49.8 million at the end of 1994. At the end of 1995, $51.1 million was unused. The Company's growth has been financed through a combination of cash provided from operations and the sale of Inacom Corp. stock in 1993, and to a lesser extent through long-term financing. Cash provided from 43

1995 ANNUAL REPORT 16 MANAGEMENT'S DISCUSSION AND ANALYSIS CONTINUED Valmont Industries, Inc. - ------------------------------------------------------------------------------- operating activities is the primary source of liquidity and amounted to $28.6 million in 1995 and $48.7 million in 1994. The Company's objective is to maintain long-term debt as a percent of invested capital in the range of 32% to 40%. However, occasionally business conditions or opportunities may warrant being temporarily outside this range. The Company is below the lower limit of the range due to the sale of its investment in Inacom Corp. in 1993 and subsequent principal payments on long-term debt. At the end of 1995 long-term debt as a percent of invested capital was 17.3% as compared to 22.4% at the end of 1994, due to payment of scheduled installments. The Company believes cash flow from operations, credit facilities available and the capital structure now in place will be adequate for 1996 planned capital expenditures, dividends and other financial commitments, and will allow the Company to pursue opportunities to expand its markets and businesses. CAPITAL EXPENDITURES In 1995, the Company expended $34.8 million in property, plant and equipment, an $11.3 million increase from the $23.5 million invested in 1994. Major additions included new facilities in Salt Lake City, Utah and Shanghai, China, and expansion of manufacturing capabilities and capacities at the Brenham, Texas plant. All three of these investments were made to increase capacity for manufacturing of engineered metal structures. These capital expenditures will enable the Company to reach new markets and customers, enhance capacity and productivity, and maintain up-to-date equipment and facilities. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS The Financial Accounting Standards Board (FASB) issued statement No. 123, "Accounting for Stock-Based Compensation" in October 1995. This statement is effective for fiscal years beginning after December 15, 1995 and requires that an employer's financial statements include certain disclosures about stock-based employee compensation arrangements regardless of the method used to account for them. The Company expects to comply with SFAS 123 in fiscal year 1996 by footnote disclosure of the pro forma amounts required by an employer that continues to apply the provisions of Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees." OUTLOOK FOR 1996 As the Company begins 1996, order backlogs are at approximately the same levels as at the beginning of 1995, $110.0 million for 1996 compared to $111.1 million a year ago. The markets for the Company's irrigation products are expected to continue favorable in 1996. The long-term driving forces of conversion from less efficient methods of irrigation and replacement of aging equipment account for more than 75% of the segment's sales. The conversion market is based on the need to conserve the world's fresh water supply and reduce runoff of unused chemicals. The replacement market is driven by the need to upgrade aging systems. The short-term market forces for irrigation products are farm income, commodity prices, interest rates and weather. While the weather is difficult to predict, management believes that the remainder of these forces are favorable entering 1996. 44

VALMONT INDUSTRIES 17 - ------------------------------------------------------------------------------- International markets also present an opportunity for the Company's Irrigation Products segment. In 1995, sales to markets in Europe, South America and Africa grew over 1994 levels. Management expects continued export growth in 1996 in order to meet the world's needs for food production. For the Industrial Products segment, the various markets are driven by infrastructure development. The Company supplies products to the communication, lighting and utility markets. In 1995, sales of poles and towers to the communication industry was the Company's fastest growing product line and management expects this growth to continue into 1996. These volume increases are supported by consumer demand for cellular phones and other wireless communication equipment. Expansion and upgrading of the world's streets and highways is a major element of the Company's sales of engineered metal pole structures to the lighting and traffic markets, along with parking lot lighting for commercial developments. The Company participates in the world markets for these products with manufacturing plants in North America, Europe and Asia. Entering 1996, management has some concerns about the European economy in general, and France in particular, but feels confident that worldwide markets will continue to grow. The Company supplies electrical transmission and distribution structures to the utility industry; this industry is currently facing possible changes due to deregulation. Management feels that the Company is well positioned to take advantage of the ultimate structure of the industry through new products and meeting the specific requirements of customers. The Company also participates in the lighting market by producing ballasts for fluorescent lamps. Management expects the electronic side of this market to grow in 1996, while the demand for magnetic products is expected to continue to decline. Overall, the Company's performance can be influenced by developments in national and world economies, however, management feels that the markets the Company serves provide ample opportunities for growth in the future. (graph) (graph) (graph) - ------------------------------------------------------------------------------- 45

1995 ANNUAL REPORT 18 SELECTED ELEVEN-YEAR FINANCIAL DATA Valmont Industries, Inc. - ----------------------------------------------------------------------------- (Dollars in thousands, except per share amounts) 1995 1994 1993 - ----------------------------------------------------------------------------- OPERATING DATA Net sales $544,642 501,740 464,274 Earnings (loss) from continuing operations 24,759 18,887 7,551 Earnings from discontinued operations - - 4,637 Cumulative effect of accounting change - - (4,910) -------------------------- Net earnings (loss) $ 24,759 18,887 7,278 ========================== Depreciation and amortization $ 12,361 11,018 10,907 Capital expenditures 34,772 23,535 17,089 PER SHARE DATA Earnings (loss): Continuing operations $ 1.80 1.39 0.55 Discontinued operations - - 0.34 Cumulative effect of accounting change - - (0.36) -------------------------- Net earnings (loss) $ 1.80 1.39 0.53 ========================== Cash dividends $ 0.30 0.30 0.29 Shareholders' equity 11.74 10.20 9.03 FINANCIAL POSITION Working capital $ 80,993 88,278 87,793 Property, plant and equipment, net 113,532 89,201 75,501 Total assets 308,710 283,443 261,275 Long-term debt, including current installments 36,687 43,242 44,076 Shareholders' equity 159,256 137,582 121,841 Invested capital 212,198 193,261 178,719 KEY FINANCIAL MEASURES Return on beginning shareholders' equity 18.0% 15.5% 6.1% Return on invested capital 11.7% 9.8% 4.1% Long-term debt as a percent of invested capital 17.3% 22.4% 24.7% YEAR-END DATA Shares outstanding (000) 13,560 13,495 13,486 Approximate number of shareholders 3,900 3,800 3,800 Number of employees 4,166 3,946 4,152 Per share amounts and number of shares reflect the two-for-one stock splits in 1988 and 1989. Prior periods have been restated to include the acquisition of Microflect using the pooling of interests method of accounting. 46

VALMONT INDUSTRIES 19 - ----------------------------------------------------------------------- 1992 1991 1990 1989 1988 1987 1986 1985 - ----------------------------------------------------------------------- 445,481 446,543 461,789 443,444 439,569 291,350 217,511 239,076 11,671 (8,822) 11,373 16,818 12,301 5,672 67 (1,453) 3,564 2,134 5,474 4,602 3,639 3,172 2,321 1,467 - - - - - - - - - ----------------------------------------------------------------------- 15,235 (6,688) 16,847 21,420 15,940 8,844 2,388 14 ======================================================================= 12,585 11,285 9,887 7,608 7,788 7,057 5,970 5,984 8,353 11,539 20,607 17,470 9,750 7,432 6,733 6,196 0.87 (0.65) 0.84 1.24 0.94 0.45 0.01 (0.12) 0.26 0.15 0.40 0.34 0.28 0.25 0.18 0.12 - - - - - - - - - ----------------------------------------------------------------------- 1.13 (0.50) 1.24 1.58 1.22 0.70 0.19 0.00 ======================================================================= 0.26 0.26 0.26 0.22 0.17 0.15 0.15 0.15 8.85 8.12 8.85 7.88 6.52 5.54 4.96 4.90 68,551 69,143 66,302 72,811 58,786 44,986 25,718 25,966 78,150 84,144 81,675 71,872 53,135 53,785 41,726 41,415 286,076 291,041 291,163 268,216 225,461 203,674 137,799 137,843 69,735 81,698 63,003 66,774 47,337 52,780 25,798 29,164 118,428 108,142 117,200 104,069 84,163 68,591 61,209 60,058 198,521 200,650 191,255 180,464 138,392 128,561 91,836 93,171 14.1% (5.7%) 16.2% 25.5% 23.2% 14.4% 4.0% 0.0% 7.7% (3.3%) 8.8% 11.9% 11.5% 6.9% 2.6% 0.0% 35.1% 40.7% 32.9% 37.0% 34.2% 41.1% 28.1% 31.3% 13,375 13,310 13,247 13,206 12,914 12,374 12,346 12,258 3,500 3,500 2,800 1,600 1,500 1,100 1,150 1,360 4,532 4,478 4,524 4,255 3,569 3,598 1,746 1,880 47

1995 ANNUAL REPORT 20 CONSOLIDATED STATEMENTS OF OPERATIONS Valmont Industries, Inc. - ----------------------------------------------------------------------------------------------------------------- THREE-YEAR PERIOD ENDED DECEMBER 30, 1995 (Dollars in thousands, except per share amounts) 1995 1994 1993 - ----------------------------------------------------------------------------------------------------------------- Net sales $544,642 501,740 464,274 Cost of sales 399,691 380,254 354,502 ------------------------------------------------ Gross profit 144,951 121,486 109,772 Selling, general and administrative expenses 103,120 89,807 82,043 Restructuring charge - - 10,961 ------------------------------------------------ Operating income 41,831 31,679 16,768 ------------------------------------------------ Other income (deductions): Interest expense (4,331) (4,711) (5,910) Interest income 820 879 805 Miscellaneous 139 1,723 209 ------------------------------------------------ (3,372) (2,109) (4,896) ------------------------------------------------ Earnings from continuing operations before income taxes 38,459 29,570 11,872 ------------------------------------------------ Income tax expense (benefit): Current 13,713 7,405 6,202 Deferred (13) 3,278 (1,881) ------------------------------------------------ 13,700 10,683 4,321 ------------------------------------------------ Earnings from continuing operations 24,759 18,887 7,551 Earnings from discontinued operations, net of tax - - 4,637 Cumulative effect of accounting change - - (4,910) ------------------------------------------------ Net earnings $ 24,759 18,887 7,278 ================================================ Earnings (loss) per share: Continuing operations $ 1.80 1.39 0.55 Discontinued operations - - 0.34 Cumulative effect of accounting change - - (0.36) ------------------------------------------------ Net earnings $ 1.80 1.39 0.53 ================================================ Cash dividends per share $ 0.30 0.30 0.29 ================================================ Weighted average number of common and common equivalent shares outstanding (000) 13,733 13,615 13,620 ================================================ See accompanying notes to consolidated financial statements. 48

1995 ANNUAL REPORT 21 CONSOLIDATED BALANCE SHEETS Valmont Industries, Inc. - ----------------------------------------------------------------------------------------------------------------------- DECEMBER 30, 1995 AND DECEMBER 31, 1994 (Dollars in thousands) 1995 1994 - ----------------------------------------------------------------------------------------------------------------------- ASSETS Current assets: Cash and cash equivalents $ 16,996 30,128 Receivables, less allowance for doubtful receivables of $2,941 in 1995 and $2,798 in 1994 82,211 78,160 Deferred income taxes 8,524 7,363 Inventories 76,426 66,031 Prepaid expenses 1,670 1,894 -------------------------------- Total current assets 185,827 183,576 -------------------------------- Other assets: Investments in nonconsolidated affiliates 1,375 991 Other 7,976 9,675 -------------------------------- Total other assets 9,351 10,666 -------------------------------- Property, plant and equipment, at cost 222,255 187,168 Less accumulated depreciation and amortization 108,723 97,967 -------------------------------- Net property, plant and equipment 113,532 89,201 -------------------------------- Total assets $308,710 283,443 ================================ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Current installments of long-term debt $ 7,950 7,753 Notes payable to banks 3,492 1,693 Accounts payable 46,900 44,505 Accrued expenses 45,475 40,481 Dividends payable 1,017 866 -------------------------------- Total current liabilities 104,834 95,298 -------------------------------- Deferred income taxes 10,543 10,243 Long-term debt, excluding current installments 28,737 35,489 Minority interest in consolidated subsidiaries 2,220 501 Other noncurrent liabilities 3,120 4,330 Shareholders' equity: Preferred stock of $1 par value. Authorized 500,000 shares; none issued - - Common stock of $1 par value. Authorized 36,000,000 shares; issued 13,950,000 shares 13,950 13,950 Additional paid-in capital 4,694 4,285 Retained earnings 137,009 118,076 Currency translation adjustment 3,689 2,001 -------------------------------- 159,342 138,312 Less: Cost of common shares in treasury - 389,798 in 1995 (454,745 in 1994) 24 648 Unearned restricted stock 62 82 -------------------------------- Total shareholders' equity 159,256 137,582 -------------------------------- Total liabilities and shareholders' equity $308,710 283,443 ================================ See accompanying notes to consolidated financial statements. 49

1995 ANNUAL REPORT 22 CONSOLIDATED STATEMENTS OF CASH FLOWS Valmont Industries, Inc. - ------------------------------------------------------------------------------------------------------------ THREE-YEAR PERIOD ENDED DECEMBER 30, 1995 (Dollars in thousands) 1995 1994 1993 - ------------------------------------------------------------------------------------------------------------ CASH FLOWS FROM OPERATIONS: Net earnings $24,759 18,887 7,278 --------------------------------------- Adjustments to reconcile net earnings to net cash provided (used) by operations: Depreciation and amortization 12,361 11,018 10,907 Restructuring charge - - 10,380 Earnings from discontinued operations - - (4,637) Cumulative effect of accounting change - - 4,910 Other adjustments (102) (198) 302 Changes in assets and liabilities, net of acquisitions: Receivables (2,681) (2,083) (7,307) Inventories (9,742) 11,195 (11,804) Prepaid expenses 261 169 303 Accounts payable 1,486 6,001 156 Accrued expenses 3,444 (2,151) (283) Other noncurrent liabilities (1,226) 2,088 3 Income taxes 64 3,735 (11,035) --------------------------------------- Total adjustments 3,865 29,774 (8,105) --------------------------------------- Net cash provided (used) by operations 28,624 48,661 (827) --------------------------------------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property, plant and equipment (34,772) (23,535) (17,089) Acquisitions - (2,034) - Proceeds from investment by minority shareholder 1,677 - - Proceeds from sale of Inacom - - 47,557 Change in other assets 1,461 (1,638) (1,505) Proceeds from sale, net of gain, of property and equipment 212 2,334 2,524 Other, net 418 334 650 --------------------------------------- Net cash provided (used) by investment activities (31,004) (24,539) 32,137 --------------------------------------- CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings (repayments) under short-term agreements 1,754 (1,688) (1,980) Proceeds from long-term borrowings - 3,845 - Principal payments on long-term obligations (7,489) (5,802) (24,894) Dividends paid (3,612) (3,467) (3,214) Distributions of pooled company (2,063) (1,102) (946) Proceeds from exercises under employee stock plans 1,193 663 1,410 Purchase of common treasury shares (535) (996) (938) --------------------------------------- Net cash used in financing activities (10,752) (8,547) (30,562) --------------------------------------- Net increase (decrease) in cash and cash equivalents (13,132) 15,575 748 Cash and cash equivalents - beginning of year 30,128 14,553 13,805 --------------------------------------- Cash and cash equivalents - end of year $16,996 30,128 14,553 ======================================= See accompanying notes to consolidated financial statements. 50

VALMONT INDUSTRIES 23 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY Valmont Industries, Inc. - -------------------------------------------------------------------------------- THREE-YEAR PERIOD ENDED DECEMBER 30, 1995 (Dollars in thousands, except per share amounts) Additional Unearned Total Common paid-in Retained Currency Treasury restricted shareholders' stock capital earnings translation stock stock equity - ------------------------------------------------------------------------------------------------------------------------------------ BALANCE AT DECEMBER 26, 1992 $12,000 - 98,224 1,439 (145) (200) 111,318 Adjustments for pooling of interests with pooled company 1,950 850 4,310 - - - 7,110 ----------------------------------------------------------------------------------- BALANCE AT DECEMBER 26, 1992, AS RESTATED 13,950 850 102,534 1,439 (145) (200) 118,428 Net earnings - - 7,278 - - - 7,278 Cash dividends ($.29 per share) - - (3,337) - - - (3,337) Cash distributions of pooled company - - (946) - - - (946) Currency translation adjustment - - - (882) - - (882) Purchase of 52,504 common shares - - - - (938) - (938) Stock options exercised; 157,299 shares issued - 356 - - 1,054 - 1,410 Tax benefit from exercise of stock options - 600 - - - - 600 Stock awards; 7,000 shares issued - 145 - - - 83 228 ----------------------------------------------------------------------------------- BALANCE AT DECEMBER 25, 1993 13,950 1,951 105,529 557 (29) (117) 121,841 Net earnings - - 18,887 - - - 18,887 Cash dividends ($.30 per share) - - (3,467) - - - (3,467) Cash distributions of pooled company - - (1,102) - - - (1,102) Reclassification of retained earnings, pooled company - 1,771 (1,771) - - - - Currency translation adjustment - - - 1,444 - - 1,444 Purchase of 62,718 common shares - - - - (996) - (996) Stock options exercised; 64,575 shares issued - 286 - - 377 - 663 Tax benefit from exercise of stock options - 173 - - - - 173 Stock awards; 7,000 shares issued - 104 - - - 35 139 ----------------------------------------------------------------------------------- BALANCE AT DECEMBER 31, 1994 $13,950 4,285 118,076 2,001 (648) (82) 137,582 Net earnings - - 24,759 - - - 24,759 Cash dividends ($.30 per share) - - (3,763) - - - (3,763) Cash distributions of pooled company - - (2,063) - - - (2,063) Currency translation adjustment - - - 1,688 - - 1,688 Purchase of 21,249 common shares - - - - (535) - (535) Stock options exercised; 79,196 shares issued - 34 - - 1,159 - 1,193 Tax benefit from exercise of stock options - 338 - - - - 338 Stock awards; 7,000 shares issued - 37 - - - 20 57 ----------------------------------------------------------------------------------- BALANCE AT DECEMBER 30, 1995 $13,950 4,694 137,009 3,689 (24) (62) 159,256 =================================================================================== See accompanying notes to consolidated financial statements. 51

1995 ANNUAL REPORT 24 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Valmont Industries, Inc. - -------------------------------------------------------------------------------- THREE-YEAR PERIOD ENDED DECEMBER 30, 1995 (Dollars in thousands, except per share amounts.) (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The consolidated financial statements include the accounts of Valmont Industries, Inc. (the Company) and its wholly and majority-owned subsidiaries. All significant intercompany items have been eliminated. The consolidated financial statements have been restated for the July 31, 1995 acquisition of Microflect Company, Inc., (Microflect), which has been accounted for as a pooling of interests. The financial statements and notes reflect amounts related to the consolidated results of the Company and Microflect. In 1994, the Company acquired the assets of Energy Steel Corporation of Tulsa, Oklahoma, a manufacturer of utility products. Pro forma consolidated financial information is not considered significant and has been omitted. Fiscal Year The Company operates on a 52/53 week fiscal year basis which ends on the last Saturday in December, except for certain foreign subsidiaries which operate on a fiscal year which ends on November 30. Accordingly, the Company's fiscal years 1995, 1994 and 1993 ended on December 30, December 31 and December 25, respectively and contained 52 weeks, 53 weeks and 52 weeks respectively. Inventories At December 30, 1995 approximately 46% of inventory is valued at the lower of cost on the basis of the last-in, first-out (LIFO) dollar value method under the natural business unit concept or market (net realizable value). As a result, it is not possible to segregate inventory into its component values of raw material, work in process and finished goods. All other inventory is valued at the lower of first-in, first-out (FIFO) cost or market (net realizable value). During 1994, the method of determining the cost of inventories for the lighting ballast product line was changed from the LIFO method to the FIFO method because the Company has experienced deflationary material and labor cost components of inventory. The effect of this change was immaterial for all years presented. The excess of replacement cost of inventories over the LIFO value is approximately $10,200 and $10,600 at December 30, 1995 and December 31, 1994, respectively. Property, Plant and Equipment Property, plant and equipment are stated at historical cost. Depreciation and amortization are provided on the straight-line method over the estimated useful lives of the respective assets. Income Taxes Effective the beginning of fiscal 1993, the Company adopted Statement of Financial Accounting Standards No. 109 (SFAS 109), "Accounting for Income Taxes." Under SFAS 109, the asset and liability method is used to calculate deferred income taxes. Deferred tax assets and liabilities are recognized on temporary differences between financial statement and tax bases of assets and liabilities using enacted tax rates. The effect that a change in tax rates has on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The cumulative effect of adopting SFAS 109 decreased 1993 net earnings by $4,910 ($.36 per share). Foreign Currency Translations Results of operations for foreign subsidiaries are translated using the average exchange rates during the period. The assets and liabilities are translated at the exchange rates in effect on the balance sheet date. Cumulative translation adjustments are included as a separate component of shareholders' equity. Earnings Per Share Earnings per share are based on the weighted average number of common shares outstanding and equivalent common shares from in-the-money stock options. The difference between primary and fully-diluted earnings per share is not material. 52

VALMONT INDUSTRIES 25 - ------------------------------------------------------------------------------- Miscellaneous The miscellaneous caption of "Other income (deductions)" in the consolidated statements of operations contains gains and losses which are of an unusual or infrequent nature. Pretax gains from disposal of excess property amounting to $1,183 were included in 1994. Use of Estimates Management of the Company has made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these financial statements in conformity with generally accepted accounting principles. Actual results could differ from those estimates. (2) CASH FLOW SUPPLEMENTARY INFORMATION The Company considers all highly liquid temporary cash investments purchased with a maturity of three months or less to be cash equivalents. Cash payments for interest and income taxes (net of refunds) were as follows: 1995 1994 1993 ------------------------ Interest $ 4,456 $4,792 $ 6,192 Income taxes 11,591 4,819 14,514 (3) DISCONTINUED OPERATIONS AND INVESTMENT IN NONCONSOLIDATED AFFILIATES The Company's investment in Inacom Corp., which was previously accounted for under the equity method of accounting as an investment in nonconsolidated affiliate, was sold in 1993 in an underwritten public offering. The Company received net cash proceeds of $47,557 and realized a net gain after tax of $3,950. The Company's share of Inacom net earnings prior to the public offering were $687 in 1993. All other nonconsolidated affiliates are not material. (4) PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment, at cost, consists of the following: 1995 1994 ----------------- Land and improvements $ 9,503 8,101 Buildings and improvements 54,959 48,686 Machinery and equipment 106,890 95,933 Transportation equipment 3,319 3,118 Office furniture and equipment 20,581 18,350 Construction in progress 27,003 12,980 ----------------- $222,255 187,168 ================= The Company also leases certain facilities, machinery, computer equipment and transportation equipment under operating leases with unexpired terms ranging from one to eight years. Rental expense for operating leases amounted to $4,638, $3,807 and $3,399 for fiscal 1995, 1994 and 1993, respectively. Minimum lease payments under operating leases expiring subsequent to December 30, 1995 are: Fiscal year ending 1996 $ 2,940 1997 2,360 1998 1,936 1999 1,558 2000 1,378 Subsequent 1,692 ------- Total minimum lease payments $11,864 ======= 53

1995 ANNUAL REPORT 26 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS CONTINUED Valmont Industries, Inc. - ------------------------------------------------------------------------------- (5) BANK CREDIT ARRANGEMENTS The Company maintains various lines of credit for short-term borrowings totaling $54,595. The interest rates charged on these lines of credit relate to the banks' cost of funds. The unused borrowings under the lines of credit were $51,103 at December 30, 1995. The lines of credit can be modified at any time at the option of the banks. The Company pays facility fees of 1/8 to 3/8 of 1% (or equivalent balances) in connection with $28,000 of its lines of credit, and pays no fees in connection with the remaining lines of credit. The weighted average interest rate on short-term borrowings was 8.9% at December 30, 1995 and 8.5% at December 31, 1994. (6) INCOME TAXES Total income tax expense was allocated as follows: 1995 1994 1993 ------------------------------------- Continuing operations $13,700 10,683 4,321 Discontinued operations - - 2,780 ------------------------------------- $13,700 10,683 7,101 ===================================== Income tax expense (benefit) attributable to income from continuing operations consists of: 1995 1994 1993 ------------------------------------- Current: Federal $10,919 5,454 5,064 State 954 682 609 Foreign 1,840 1,269 529 ------------------------------------- 13,713 7,405 6,202 Deferred: ------------------------------------- Federal (11) 3,428 (1,453) State (2) 278 (186) Foreign - (428) (242) ------------------------------------- (13) 3,278 (1,881) ------------------------------------- $13,700 10,683 4,321 ===================================== The reconciliations of the statutory Federal income tax rate and the effective tax rates follow: 1995 1994 1993 ------------------------------------- Statutory Federal income tax rate 35.0 % 35.0 % 35.0 % State income taxes, net of Federal benefit 1.6 % 2.4 % 3.0 % Other (1.0) % (1.3) % (1.6) % ------------------------------------- 35.6 % 36.1 % 36.4 % ===================================== 54

VALMONT INDUSTRIES 27 - -------------------------------------------------------------------------------- The tax effects of temporary differences that give rise to deferred tax assets and liabilities at December 30, 1995 and December 31, 1994 are presented below: 1995 1994 --------------------- Deferred tax assets: Accrued expenses and allowances $13,008 11,480 Allowance for doubtful receivables 400 384 Inventory capitalization 979 869 --------------------- Total deferred tax assets 14,387 12,733 --------------------- Deferred tax liabilities: Plant and equipment, primarily due to depreciation 5,448 4,604 Lease transactions 1,769 1,850 Warranty accrual 1,373 1,373 Business combination adjustments 3,439 3,439 Other 4,377 4,347 --------------------- Total deferred tax liabilities 16,406 15,613 --------------------- Net deferred tax liabilities $(2,019) (2,880) ===================== No valuation allowance for deferred tax assets has been provided since all tax benefits are more likely than not to be used to offset future taxable income. (7) LONG-TERM DEBT 1995 1994 --------------------- 9.40% to 12.77% promissory notes, unsecured (a) $23,750 28,250 Promissory note, secured (b) 7,714 9,606 6.0% to 9.34% notes 5,223 5,386 --------------------- Total long-term debt 36,687 43,242 Less current installments of long-term debt 7,950 7,753 --------------------- Long-term debt, excluding current installments $28,737 35,489 ===================== (a) The promissory notes payable are due in varying annual principal installments through 2001. The notes are subject to prepayment in whole or in part with or without premium as specified in the agreements. (b) The promissory note totaling 38.6 million French francs is due in three equal annual principal installments through 1998. The interest rate on the note is variable based on 6-month PIBOR (Paris Interbank Offering Rate), or can be fixed at the Company's option. At December 30, 1995 the effective interest rate was 5.03%. The note is secured by the common stock of Sermeto. The agreements place certain restrictions on working capital, capital expenditures, payment of dividends, purchase of Company stock and additional borrowings. The amount of retained earnings at December 30, 1995 not restricted as to payment of cash dividends and purchase of the Company's capital stock under the most restrictive provisions of the agreements was approximately $42,000. The minimum aggregate maturities of long-term debt for each of the four years following 1996 are: $7,645, $7,538, $4,943 and $3,760. 55

1995 ANNUAL REPORT 28 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS CONTINUED Valmont Industries, Inc. - -------------------------------------------------------------------------------- (8) STOCK PLANS Stock plans approved by the shareholders provide that the Compensation Committee of the Board of Directors may grant incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock awards and bonuses of common stock. Options granted are exercisable at the market price of the common stock on the grant date, generally are exercisable in three to six equal annual installments and expire from six to ten years after issuance. The optioned shares are subject to changes in capitalization. The changes in the outstanding stock options during the three years ended December 30, 1995 are summarized below: Option price Shares per share range ------------------------------------- Balance at December 26, 1992 1,090,740 $ 3.91 - 24.25 Granted 15,000 14.75 - 19.50 Exercised (157,299) 3.91 - 18.50 Canceled (170,234) 5.91 - 24.25 --------- Balance at December 25, 1993 778,207 5.41 - 24.25 Granted 152,000 14.75 - 18.25 Exercised (64,575) 5.41 - 12.00 Canceled (81,858) 10.56 - 24.25 --------- Balance at December 31, 1994 783,774 5.91 - 18.50 Granted 201,500 19.25 - 23.75 Exercised (79,196) 5.91 - 19.63 Canceled (11,057) 10.56 - 19.63 --------- BALANCE AT DECEMBER 30, 1995 895,021 $ 5.91 - 23.75 ========= OPTIONS EXERCISABLE AT DECEMBER 30, 1995 378,188 $ 5.91 - 18.50 ========= (9) EMPLOYEE RETIREMENT SAVINGS PLAN Established under Internal Revenue Code Section 401(k), the Valmont Employee Retirement Savings Plan is available to all eligible employees. The Company makes an annual basic contribution equal to $.25 on the dollar of the first 3% of each participant's annual pay. In addition, participants can elect to contribute up to 15% of annual pay, on a pretax and/or after-tax basis. The Company will match $.50 to $.75 on the dollar of the first 6% of the employee pretax contribution. The Company, at the discretion of the Board of Directors, may also pay a supplemental contribution of up to $.50 on the dollar of the first 6% of the participants' pretax contributions. In addition, the Company has a defined contribution plan covering the employees of Microflect; contributions under this plan are based primarily on the performance of the business unit and employee compensation. The 1995, 1994 and 1993 Company contributions to these plans amounted to approximately $4,700, $3,000 and $3,100, respectively. (10) RESEARCH AND DEVELOPMENT The Company's accounting system does not accumulate all costs incidental to research and development for new products or improvements to existing products. It is estimated that the research and development costs charged against earnings were approximately $2,800 in 1995, $2,700 in 1994 and $2,700 in 1993. (11) RESTRUCTURING CHARGES During 1993, the Company incurred a $10,961 nonrecurring restructuring charge ($7,125 or 52 cents per share after tax) related to its lighting ballast subsidiary, Valmont Electric, Inc. The charge was the result of finalizing the move of ballast operations from Illinois to Texas as well as changes in the ballast market. Write-offs of equipment no longer necessary, severance accruals and other related costs were included in the charge. 56

VALMONT INDUSTRIES 29 - -------------------------------------------------------------------------------- (12) DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying amount of cash and cash equivalents, receivables, accounts payable, notes payable to banks and accrued expenses approximates fair value because of the short maturity of these instruments. The fair values of each of the Company's long-term debt instruments are based on the amount of future cash flows associated with each instrument discounted using the Company's current borrowing rate for similar debt instruments of comparable maturity. The fair value estimates are made at a specific point in time and the underlying assumptions are subject to change based on market conditions. At December 30, 1995, the carrying amount of the Company's long-term debt is $36,687 with an estimated fair value of approximately $39,000. (13) STOCKHOLDERS' RIGHT PLAN In December 1995, the Company's Board of Directors declared a dividend of one preferred stock purchase right ("Right") for each outstanding share of common stock. The Rights become exercisable ten days after a person (other than Robert B. Daugherty and his related persons and entities) acquires or commences a tender offer for 15% or more of the Company's common stock. Each Right entitles the holder to purchase one one-thousandth of a share of a new series of preferred stock at an exercise price of $100, subject to adjustment. The Rights expire on December 19, 2005 and may be redeemed at the option of the Company at $.01 per Right, subject to adjustment. Under certain circumstances, if (i) any person becomes an Acquiring Person or (ii) the Company is acquired in a merger or other business combination, each holder of a Right (other than the Acquiring Person) will have the right to receive, upon exercise of the Right, shares of common stock (of the Company under (i) and of the acquiring company under (ii)) having a value of twice the exercise price of the Right. (14) ACQUISITION On July 31, 1995, Microflect Company, Inc. was merged with and became a wholly-owned subsidiary of the Company pursuant to the terms of an agreement and Plan of Merger under which the Company exchanged 1,950,000 shares of its common stock for all of the outstanding common stock of Microflect. The merger qualifies as a tax-free reorganization and was accounted for as a pooling of interests. Accordingly, the Company's consolidated financial statements have been restated to include the results of Microflect for all periods presented. The combined financial results presented include adjustments made to conform accounting policies of the two companies. The only adjustment impacting net income was the recording of income taxes, as prescribed by SFAS No. 109, for Microflect as it was a subchapter S corporation prior to the merger. All other adjustments are reclassifications to conform with the financial statement presentation. Combined and separate results of the Company and Microflect during the periods preceding the merger were as follows: Six months ended July 1, 1995 (Unaudited) The Company Microflect Adjustments Combined ------------------------------------------------ Net revenues $258,298 $18,068 $ (725) $275,641 Net income 10,628 2,768 (1,011) 12,385 Fiscal year ended December 31, 1994 The Company Microflect Adjustments Combined ------------------------------------------------ Net revenues $471,745 $30,616 $ (621) $501,740 Net income 16,119 4,630 (1,862) 18,887 Microflect designs, manufactures and installs communication structures, passive repeaters, waveguide supporting systems and components for the wireless communication market. In addition to its microwave tower business, it operates a grating division and an industrial fasteners division. (15) BUSINESS SEGMENTS The Company's business activities are currently classified into the following industry segments: Industrial Products - The manufacture and distribution of engineered metal structures and lighting ballasts. Irrigation Products - The manufacture and distribution of agricultural irrigation equipment and related products. Financial information concerning the Company's business segments is summarized on the following page and is considered an integral part of this note. 57

1995 ANNUAL REPORT 30 BUSINESS SEGMENT INFORMATION Valmont Industries, Inc. - --------------------------------------------------------------------------------------- (Dollars in thousands) 1995 1994 1993 - --------------------------------------------------------------------------------------- SUMMARY BY BUSINESS SEGMENTS: NET SALES: Industrial Products $381,898 337,810 330,447 Irrigation Products 162,744 164,030 134,219 Less intersegment sales - (100) (392) ----------------------------------- Total $544,642 501,740 464,274 =================================== OPERATING INCOME: Industrial Products 35,924 23,638 7,715 Irrigation Products 18,736 17,742 14,059 ----------------------------------- Total 54,660 41,380 21,774 GENERAL CORPORATE EXPENSE, NET (12,829) (9,701) (5,006) INTEREST EXPENSE, NET (3,511) (3,832) (5,105) MISCELLANEOUS 139 1,723 209 ----------------------------------- Earnings from continuing operations before income taxes $ 38,459 29,570 11,872 =================================== IDENTIFIABLE ASSETS: Industrial Products 234,818 197,856 195,312 Irrigation Products 51,792 46,554 43,299 Corporate 22,100 39,033 22,664 ----------------------------------- Total $308,710 283,443 261,275 =================================== CAPITAL EXPENDITURES: Industrial Products 30,200 16,011 12,425 Irrigation Products 4,204 7,191 4,504 Corporate 368 333 160 ----------------------------------- Total $ 34,772 23,535 17,089 =================================== DEPRECIATION AND AMORTIZATION: Industrial Products 8,727 8,044 7,983 Irrigation Products 2,923 2,173 1,903 Corporate 711 801 1,021 ----------------------------------- Total $ 12,361 11,018 10,907 =================================== Summary by Geographical Area: NET SALES: United States $447,685 424,666 384,526 Europe 64,745 51,018 49,876 Other 32,212 26,056 29,872 ----------------------------------- Total $544,642 501,740 464,274 =================================== OPERATING INCOME: United States 47,543 34,830 16,065 Europe 4,936 3,248 3,004 Other 2,181 3,302 2,705 ----------------------------------- Total $ 54,660 41,380 21,774 =================================== IDENTIFIABLE ASSETS: United States 228,681 216,320 202,413 Europe 64,790 62,334 54,270 Other 15,239 4,789 4,592 ----------------------------------- Total $308,710 283,443 261,275 =================================== Total sales by business segment are to unaffiliated customers. Net sales by geographical area are based on destination of sales. Operating income by business segment is based on net sales, less identifiable operating expenses and restructuring charge. Operating income by geographical area is based on destination of sales less appropriate expense allocations. Corporate assets consist of cash, deferred income taxes, investment in nonconsolidated affiliates, and administrative buildings and equipment. Identifiable assets by geographical area are based on location of facilities. 58

VALMONT INDUSTRIES 31 QUARTERLY FINANCIAL DATA (UNAUDITED) Valmont Industries, Inc. - ------------------------------------------------------------------------------------------------------ (Dollars in thousands, except per share amounts) Net Earnings (Loss) from Continuing Operations Earnings Stock Price Net Gross ------------------- ---------------- -------------- Dividends Sales Profit Amount Per Share Amount Per Share High Low Declared - ------------------------------------------------------------------------------------------------------- 1995 FIRST $142,223 34,877 5,694 0.42 5,694 0.42 21.50 16.25 0.075 SECOND 133,418 34,948 6,691 0.49 6,691 0.49 22.00 19.50 0.075 THIRD 128,269 35,099 5,271 0.38 5,271 0.38 24.25 20.75 0.075 FOURTH 140,732 40,027 7,103 0.51 7,103 0.51 26.00 23.50 0.075 - ------------------------------------------------------------------------------------------------------ YEAR $544,642 144,951 24,759 1.80 24,759 1.80 26.00 16.25 0.300 - ------------------------------------------------------------------------------------------------------ 1994 First $117,671 26,756 3,583 0.26 3,583 0.26 20.50 14.50 0.075 Second 128,656 30,092 4,893 0.36 4,893 0.36 17.00 13.50 0.075 Third 118,500 29,420 4,647 0.34 4,647 0.34 16.75 14.50 0.075 Fourth 136,913 35,218 5,764 0.42 5,764 0.42 17.50 15.75 0.075 - ------------------------------------------------------------------------------------------------------ Year $501,740 121,486 18,887 1.39 18,887 1.39 20.50 13.50 0.300 - ------------------------------------------------------------------------------------------------------ 1993 First $111,523 27,106 3,099 0.23 (1,124) (0.08) 22.75 16.50 0.065 Second 122,165 28,884 4,446 0.33 8,729 0.64 21.75 14.75 0.075 Third 115,016 26,754 3,495 0.25 3,162 0.23 17.63 13.00 0.075 Fourth 115,570 27,028 (3,489) (0.26) (3,489) (0.26) 20.25 14.00 0.075 - ------------------------------------------------------------------------------------------------------ Year $464,274 109,772 7,551 0.55 7,278 0.53 22.75 13.00 0.290 - ------------------------------------------------------------------------------------------------------ Earnings per share are computed independently for each of the quarters. Therefore, the sum of the quarterly earnings per share may not equal the total for the year. 59

1995 ANNUAL REPORT 32 INDEPENDENT AUDITORS' REPORT Valmont Industries, Inc. - -------------------------------------------------------------------------------- THE BOARD OF DIRECTORS VALMONT INDUSTRIES, INC.: We have audited the consolidated balance sheets of Valmont Industries, Inc. and Subsidiaries as of December 30, 1995 and December 31, 1994 and the related consolidated statements of operations, shareholders' equity and cash flows for each of the years in the three-year period ended December 30, 1995. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Valmont Industries, Inc. and Subsidiaries as of December 30, 1995 and December 31, 1994, and the results of their operations and their cash flows for each of the years in the three-year period ended December 30, 1995, in conformity with generally accepted accounting principles. As described in Note 1 to the consolidated financial statements, the Company adopted the provisions of Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes," in fiscal 1993. /s/ KPMG Peat Marwick, LLP Omaha, Nebraska February 16, 1996 60

VALMONT INDUSTRIES 33 MANAGEMENT'S REPORT Valmont Industries, Inc. - -------------------------------------------------------------------------------- The consolidated financial statements of Valmont Industries, Inc. and Subsidiaries and the other information contained in the Annual Report were prepared by and are the responsibility of management. The statements have been prepared in accordance with generally accepted accounting principles and necessarily include amounts based on management's best estimates and judgments. In fulfilling its responsibilities, management relies on a system of internal controls which provide reasonable assurance that the financial records are reliable for preparing financial statements and for maintaining accountability of assets. Internal controls are designed to reduce the risk that material errors or irregularities in the financial statements may occur and not be timely detected. These systems are augmented by written policies, careful selection and training of qualified personnel, an organizational structure providing division of responsibilities and a program of financial, operational and systems audits. The Company also has a business ethics policy which requires employees to maintain high ethical standards in the conduct of Company business. The Audit Committee, composed of non-employee directors is responsible for recommending to the Board of Directors, subject to ratification by shareholders, the independent accounting firm to be retained each year. The Audit Committee meets regularly, and when appropriate separately, with the independent certified public accountants, management and the internal auditors to review Company performance. The independent certified public accountants, internal auditors, and the Audit Committee have unrestricted access to each other in the discharge of their responsibilities. /s/ Mogens C. Bay - ------------------------------------------- Mogens C. Bay President and Chief Executive Officer /s/ Terry J. McClain - ------------------------------------------- Terry J. McClain Vice President and Chief Financial Officer 61

1995 ANNUAL REPORT 34 BOARD OF DIRECTORS AND OFFICERS - -------------------------------------------------------------------------------- Valmont Industries, Inc. BOARD OF DIRECTORS ROBERT B. DAUGHERTY THOMAS F. MADISON 1 MOGENS C. BAY WALTER SCOTT, JR. 2 Chairman of the Board President, MLM Partners President and CEO Chairman and President Valmont Industries, Inc. Retired President - Markets Valmont Industries, Inc. Peter Kiewit Sons', Inc. Director since 1947 U S WEST Communications Director since 1993 Director since 1981 Director since 1987 CHARLES M. HARPER 1 JOHN E. JONES 2 1 Compensation Committee Chairman of the Board ALLEN F. JACOBSON 1 Retired Chairman, President 2 Audit Committee RJR Nabisco Holdings Corp. and Retired Chairman and CEO and CEO CBI Industries, Inc. Chairman of the Board 3M Company Director since 1993 Nabisco Holdings Corp. Director since 1976 Director since 1979 LLOYD P. JOHNSON 1 Retired Chairman of the Board Norwest Corporation [PICTURE] Director since 1991 ROBERT G. WALLACE 2 Retired Executive Vice President Phillips Petroleum Co. Director since 1984 from left to right) back row, Robert B. Daugherty, Walter Scott, Jr., Mogens C. Bay, John E. Jones, Allen F. Jacobson; front row, Robert G. Wallace, Lloyd P. Johnson, Charles M. Harper, and Thomas F. Madison ---------------------------------------------------------- CORPORATE OFFICERS ROBERT B. DAUGHERTY TERRY J. MCCLAIN THOMAS P. EGAN, JR. MARK E. TREINEN Chairman of the Board Vice President and Vice President - Corporate Vice President - Chief Financial Officer Counsel and Secretary Business Development MOGENS C. BAY VINCENT T. CORSO BRIAN C. STANLEY TOMMY L. WHALEN President and Vice President - Operations Vice President - Investor Vice President - Chief Executive Officer Relations and Controller Human Resources DIVISION AND SUBSIDIARY OFFICERS GARY L. CAVEY LEWIS P. HAYS HOWARD G. SACHS President and President President and Chief Operating Officer Valmont Europe Chief Operating Officer Industrial Products Division Valmont Electric, Inc. E. ROBERT MEANEY JOSEPH M. GOECKE President and President and Chief Operating Officer Chief Operating Officer Valmont International Valmont Irrigation 62

SHAREHOLDER INFORMATION ________________________________________________________________________________ CORPORATE HEADQUARTERS Valmont Industries, Inc. P.O. Box 358 Valley, Nebraska 68064 U.S.A. (402) 359-2201 INDEPENDENT PUBLIC ACCOUNTANTS KPMG Peat Marwick LLP Omaha, Nebraska LEGAL COUNSEL McGrath, North, Mullin & Kratz, P.C. Omaha, Nebraska STOCK TRANSFER AGENT AND REGISTRAR First National Bank of Omaha Trust Department One First National Center Omaha, Nebraska 68102-1596 (402) 341-0500 Notices regarding changes of address and inquiries regarding lost dividend checks, lost or stolen certificates and transfers of stock, should be directed to the transfer agent. ANNUAL MEETING The annual meeting of Valmont's shareholders will be held at 2:00 p.m. on Monday, April 22, 1996, at Joslyn Art Museum, 2200 Dodge Street, Omaha, Nebraska. STOCK TRADING Valmont's common stock trades on The Nasdaq Stock Market under the symbol VALM. Current share price and related information can be found in the financial section of many daily newspapers. AVAILABILITY OF 10-K REPORT A copy of Valmont's 1995 Annual Report on Form 10-K may be obtained by calling or writing the Investor Relations Department, Valmont Industries, Inc., P.O. Box 358, Valley, Nebraska 68064 U.S.A. Phone: (402) 359-2201; Fax: (402) 359-2848 STOCK HELD IN "STREET NAME" Valmont maintains a direct mailing list to ensure that shareholders with stock held in broker accounts receive information on a timely basis. If you would like your name added to this list, please direct your request to: Investor Relations Department, Valmont Industries, Inc., P.O. Box 358, Valley, Nebraska 68064 U.S.A. Phone: (402) 359-2201; Fax (402) 359-2848 SHAREHOLDER AND INVESTOR RELATIONS Valmont maintains an active investor relations program to keep shareholders and potential investors informed about the company. Comments and inquiries are welcome and should be directed to the Investor Relations Department, Valmont Industries, Inc., P.O. Box 358, Valley, Nebraska 68064 U.S.A. Phone: (402) 359-2201; Fax: (402) 359-2848 MARKET MAKERS The following firms make a market in Valmont Industries, Inc. common stock as of February 21, 1996: Dain Bosworth Inc. Herzog, Heine, Geduld, Inc. Huntleigh Securities Corporation Kirkpatrick Pettis Inc. Lehman Brothers Inc. Merrill Lynch, Pierce, Fenner & Smith Inc. 63

Exhibit 21 SUBSIDIARIES OF VALMONT INDUSTRIES, INC. State or Country Name of Subsidiary of Incorporation ------------------ ---------------- American Lighting Standards Corp. d/b/a Valmont/ALS Texas Best-All Electric, Inc. Nebraska CCC de Mexico, S.A. de C.V. Mexico Gate City Steel Corporation Delaware Lampadaires Feralux, Inc. Canada Microflect Company, Inc. Oregon NEUVALCO S.A. France SERMETO S.A. France SERMETO Iberica S.A. Spain Shanghai Valmont SST, Co. Ltd. China TUBALCO S.A. France VBT, Inc. Delaware Valmont DeEspana, S.A. Spain Valmont Electric, Inc. Delaware Valmont S.A. Spain Valmont Industries (Asia-Pacific) Ltd. Hong Kong Valmont Industries Holland B.V. The Netherlands Valmont International, L.L.C. Delaware Valmont International Corp. Texas Valmont International Inc. U. S. Virgin Islands Valmont Nederlands B.V. The Netherlands Valmont Northwest, Inc. Nebraska Valmont Polska Sp. zo.o Poland Valmont Service Centers, Inc. Nebraska Valmont World Trade, N.V. Netherlands Antilles 64

Exhibit 23 KPMG Peat Marwick LLP (letterhead) Two Central Park Plaza Telephone 402-348-1450 Telefax 402-348-0152 Suite 1501 Omaha, NE 68102 233 South 13th Street Telephone 402-476-1216 Telefax 402-476-1944 Suite 1600 Lincoln, NE 68508-2041 ACCOUNTANTS' CONSENT -------------------- The Board of Directors Valmont Industries, Inc. We consent to incorporation by reference in this Registration Statement (No. 33-21680) on Form S-8 and Registration Statement (No. 2-88663) on Form S-8 of Valmont Industries, Inc. of our reports dated February 16, 1996 relating to the consolidated balance sheets of Valmont Industries, Inc. and subsidiaries as of December 30, 1995 and December 31, 1994, and the related consolidated statements of operations, shareholders' equity and cash flows and all related consolidated financial schedules for each of the years in the three-year period ended December 30, 1995 which report appears in or is incorporated by reference in the December 30, 1995 Annual Report on Form 10- K of Valmont Industries, Inc. Our report refers to the Company's adoption of Financial Accounting Standards No. 109, Accounting for Income Taxes, in fiscal 1993. KPMG PEAT MARWICK LLP 65 Omaha, Nebraska March 22, 1996

Exhibit 24 POWER OF ATTORNEY ----------------- The undersigned Directors of Valmont Industries, Inc., a Delaware corporation, hereby constitute and appoint Mogens C. Bay as attorney-in-fact in their name, place and stead to execute Valmont's Annual Report on Form 10-K for the fiscal year ended December 30, 1995, together with any and all subsequent amendments thereof in their capacity as Director and hereby ratify all that said attorney-in-fact may do by virtue thereof. DATED this 28th day of February, 1996. /S/Robert B. Daugherty /S/John E. Jones ------------------------------ --------------------------- Robert B. Daugherty, Director John E. Jones, Director /S/Charles M. Harper /S/Thomas F. Madison ------------------------------ --------------------------- Charles M. Harper, Director Thomas F. Madison, Director /S/Allen F. Jacobson /S/Walter Scott, Jr. ------------------------------ --------------------------- Allen F. Jacobson, Director Walter Scott, Jr., Director /S/Lloyd P. Johnson /S/Robert G. Wallace ------------------------------ --------------------------- Lloyd P. Johnson, Director Robert G. Wallace, Director 66

5 This schedule contains summary financial information extracted from SEC Form 10-K and is qualified in its entirety by reference to such financial statements. Exhibit 27 1000 YEAR DEC-30-1995 DEC-30-1995 16,996 0 85,152 2,941 76,426 185,827 222,255 108,723 308,710 104,834 0 0 0 13,950 145,306 308,710 544,642 544,642 399,691 399,691 103,120 0 4,331 38,459 13,700 24,759 0 0 0 24,759 1.80 0 Cash and cash equivalents 67