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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

For the Fiscal Year Ended: February 28, 2005

Commission File No. 1-12777

AZZ incorporated

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (817) 810-0095

Securities registered pursuant to section 12(b) of the act:

Securities registered pursuant to section 12(g) of the act: None

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

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

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

The aggregate market value of the Common Stock based on the closing price of $14.25 per share on the New York Stock Exchange as of August 31, 2004 (the last business day of its most recently completed second fiscal quarter), held by nonaffiliates of the Registrant on that date was approximately $74,776,049. (For purposes of determining the above stated amount, only the directors, executive officers and 10% or greater shareholders of the Registrant have been deemed to be affiliates; however, this does not represent a conclusion by the Registrant that any or all of such persons are affiliates of the Registrant.)

As of May 16, 2005, there were 5,515,822 shares of AZZ incorporated Common Stock $1.00 par value outstanding.

Documents Incorporated By Reference

Part III incorporates information by reference from the Proxy Statement for the 2005 Annual Meeting of Shareholders of AZZ.

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AZZ incorporated

YEAR ENDED FEBRUARY 28, 2005

INDEX TO FORM 10-K

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Forward Looking Statements

This Report may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are generally identified by the use of words such as “anticipate,” “expect,” “estimate,” “intend,” “should,” “may,” “believe,” and terms with similar meanings. Although the Company believes that the current views and expectations reflected in these forward-looking statements are reasonable, those views and expectations, and the related statements, are inherently subject to risks, uncertainties, and other factors, many of which are not under the Company’s control. Those risks, uncertainties, and other factors could cause the actual results to differ materially from these in the forward-looking statements. Those risks, uncertainties, and factors include, but are not limited to: the level of customer demand for and response to products and services offered by the Company, including demand by the power generation markets, electrical transmission and distribution markets, the general industrial market, and the hot dip galvanizing markets; prices and raw material cost, including cost of zinc and natural gas which are used in the hot dip galvanizing process; changes in economic conditions of the various markets the Company serves, foreign and domestic, customer requested delays of shipments, acquisition opportunities, adequacy of financing, and availability of experienced management employees to implement the Company’s growth strategy. The Company expressly disclaims any obligations to release publicly any updates or revisions to these forward-looking statements to reflect any change in its views or expectations. The Company can give no assurances that such forward-looking statements will prove to be correct.

PART I

Item 1. Business

AZZ incorporated (“AZZ”, the “Company” or “we”) was established in 1956 and incorporated under the laws of the State of Texas. We are an electrical equipment and components manufacturer, serving the global markets of power generation, transmission and distribution, and the general industrial markets, and a leading provider of hot dip galvanizing services to the steel fabrication market nationwide.

We offer products through two distinct business segments, the Electrical and Industrial Products Segment and the Galvanizing Services Segment.

Electrical and Industrial Products Segment

Our Electrical and Industrial Products Segment produces highly engineered specialty electrical products as well as industrial lighting and tubular products, all of which we market and sell both domestically and in international markets. Our electrical products are designed, manufactured and configured to distribute electrical power to and from generators, transformers, switching devices and other electrical configurations and are supplied to the power generation, power transmission and power distribution markets as well as the general industrial market. Our industrial products include industrial lighting and tubular products used for petro-chemical and industrial applications. We provide lighting products to the petroleum, food processing, and power generation industries and to industries with unique lighting challenges and tubular products to the petroleum industry.

The markets for our Electrical and Industrial Products Segment are highly competitive and consist of a few large multi-national companies, as well as numerous small independent companies. Competition is based primarily on product quality, range of product line, price and service. While some of our competitors are much larger and better financed than us, we believe that we can compete favorably with them.

Copper, aluminum and steel are the primary raw materials used by this segment. All of these raw materials are readily available.

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We sell this segment’s products through manufacturers’ representatives, distributors, agents and our internal sales force. We are not dependent on any single customer for this segment, and the loss of any single customer would not have a material adverse effect on our consolidated revenues or net income.

Backlog of orders was approximately $64.8 million at February 28, 2005, $53.1 million at February 29, 2004, and $49.1 million at February 28, 2003. All of the backlog at our fiscal 2005 year end should be delivered during the next 18 months. We believe that the contracts and purchase orders included in the backlog are firm.

We employ a total of 546 persons in this segment.

Galvanizing Services Segment

The Galvanizing Services Segment provides hot dip galvanizing to the steel fabrication industry through facilities located throughout the South and Southwest United States. Hot dip galvanizing is a metallurgical process in which molten zinc is applied to a customer’s material. The zinc bonding renders a corrosion protection of fabricated steel for extended periods of up to 50 years. We operate eleven galvanizing plants, which are located in Texas, Louisiana, Alabama, Mississippi, Arkansas, and Arizona.

Galvanizing is a highly competitive business, and we compete with other galvanizing companies, captive galvanizing facilities operated by manufacturers, and alternate forms of corrosion protection such as paint. Our galvanizing market is generally limited to areas within a relatively close proximity of our galvanizing plants due to freight cost.

Zinc, the principal raw material used in the galvanizing process, is readily available, but has volatile pricing. We manage our exposure to commodity pricing of zinc by utilizing agreements with zinc suppliers that include protective caps to guard against rising commodity prices.

We typically serve fabricators and/or manufacturers involved in the highway construction, electrical utility, transportation, water treatment, agriculture, petrochemical and chemical, pulp and paper industries, as well as numerous OEM’s. We do not depend on any single customer for our galvanizing services, and the loss of any customer would not have a material adverse effect on our consolidated revenues or net income.

The backlog of galvanizing orders generally is nominal due to the short time requirement involved in the process.

We employ a total of 419 persons.

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Executive Officers of the Registrant

Each executive officer was elected by the Board of Directors to hold office until the next Annual Meeting or until his successor is elected. There are no family relationships between Executive Officers of the Registrant.

Available Information

We are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, and its rules and regulations. The Exchange Act requires us to file reports, proxy statements and other information with the SEC. Copies of these reports, proxy statements and other information can be inspected and copied at:

SEC Public Reference Room

450 Fifth Street, N.W.

Room 1024

Washington, D.C. 20549

You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. You may also obtain copies of any material we have filed with the SEC by mail at prescribed rates from:

Public Reference Section

Securities and Exchange Commission

450 Fifth Street N.W.

Washington, D.C. 20549-0004

You may obtain these materials electronically by accessing the SEC’s Website on the Internet at:

http://www.sec.gov

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In addition, we make available, free of charge, on our internet Website, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file this material with, or furnish it to, the SEC. You may review these documents, under the heading “Investor Relations,” subheading “SEC Filings,” by accessing our Website:

http://www.azz.com

Also, reports and other information concerning us are available for inspection and copying at:

New York Stock Exchange

20 Broad Street

New York, New York 10005

Corporate Governance

The Company’s Board of Directors, with the assistance of its Nominating and Corporate Governance Committee, has adopted Corporate Governance Guidelines that set forth the Board’s policies regarding corporate governance.

In connection with the Board of Directors’ responsibility to oversee our legal compliance and conduct, the board has adopted a Code of Ethics which applies to the Company’s officers, directors and employees.

The Board of Directors has adopted charters for each of its Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee. You may review the Corporate Governance Guidelines, our Code of Ethics and our Committee charters under the Heading “Investor Relations,” subheading “Corporate Governance,” by accessing our Website:

http://www.azz.com

You may also obtain a copy of these documents by mailing a request to:

AZZ incorporated

Investor Relations

University Centre I, Suite 200

1300 South University Drive

Fort Worth, TX 76107

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Item 2. Properties

The following table sets forth information about the Company’s principal facilities owned or leased on February 28, 2005:

Item 3. Legal Proceedings

Environmental Proceedings

We are subject to various environmental protection reviews by state and federal government agencies. We cannot presently determine the ultimate liability, if any, that might result from these reviews or additional clean-up and remediation expenses. However, as a result of an internal analysis and prior clean-up efforts, we believe that the reviews and any required mediation will not have a material impact on the Company and that the recorded reserves for estimated losses are adequate. We had reserved $505,000 as of February 28, 2005 and February 29, 2004 for estimated cost related to environmental compliance. In order to maintain permits to operate certain of our facilities, we may need to make future capital expenditures for equipment in order to meet new or existing environmental regulations.

Other Proceedings

We are is involved from time to time in various suits and claims arising in the normal course of business. In management’s opinion, the ultimate resolution of these matters will not have a material effect on our financial position or results of operations.

Item 4. Submission of Matters to a Vote of Security Holders

No matter was submitted to a vote of security holders through the solicitation of proxies or otherwise during the fourth quarter of the fiscal year ended February 28, 2005.

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PART II

Item 5. Market for Registrant’s Common Equity and Related Stockholder Matters

Our common stock, $1.00 par value, (“Common Stock”) is traded on the New York Stock Exchange and under the symbol “AZZ”. The following table sets forth the high and low sales prices of our Common Stock on the New York Stock Exchange on a quarterly basis for each of the two fiscal years ended February 28, 2005 and February 29, 2004. No dividends were declared during that period.

The payment of dividends is within the discretion of our Board of Directors and will depend on our earnings, capital requirements, operating and financial condition and other factors. We expect for the foreseeable future to invest substantially all of our earnings to expand our business.

The approximate number of holders of record of our common stock at May 16, 2005 was 648.

See Item 12 of this Report for information regarding securities authorized for issuance under equity compensation plans.

Item 6. Selected Financial Data

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

We operate two distinct segments, the Electrical and Industrial Products Segment and the Galvanizing Services Segment. The Electrical and Industrial Products Segment serves the power generation, transmission and distribution markets as well as the general industrial market. The Galvanizing Services Segment consists of eleven hot dip galvanizing facilities located throughout the South and Southwest United States that provides galvanizing service to the steel fabrication industry.

For the fiscal year-ended February 28, 2005, we recorded revenues of $152.4 million compared to the prior year’s revenues of $136.2 million. Approximately 66% of our revenues were generated from the Electrical and Industrial Products Segment and approximately 34% were generated from the Galvanizing Services Segment. Net income for fiscal 2005 was $4.8 million compared to $4.3 million in the fiscal 2004. Net income as a percentage of sales was 3.2% for fiscal 2005 as compared to 3.1% for fiscal 2004. Earnings per share increased by 10% to $.87 per share for fiscal 2005 compared to $.79 per share in fiscal 2004, on a diluted basis.

Results of Operations

Year ended February 28, 2005 (2005) compared with year ended February 29, 2004 (2004)

Management believes that analyzing our revenue and operating income by segment is the most meaningful analysis of our results of operations. Segment operating income consists of net sales less cost of sales, specifically identifiable selling, general and administrative expenses, and other (income) expense items that are specifically identifiable to a segment. The other (income) expense items included in segment operating income are generally insignificant. For a reconciliation of segment operating income to pretax income, see note 11 to Notes to Consolidated Financial Statements.

Revenues

The following table reflects the breakdown of revenue by segment:

Our consolidated net revenues for fiscal 2005 increased by $16.2 million or 12%, as compared to fiscal 2004.

The Electrical and Industrial Products Segment produces highly engineered specialty products supplied to the power generation, power transmission, power distribution and general industrial markets as well as lighting and tubular products to the industrial and petroleum markets. The segment recorded revenues for fiscal 2005 of $100.5 million, an increase of 13% above the fiscal 2004 results of $88.9 million. The increased revenue resulted primarily from increased demand for our products in the power distribution and petroleum markets. While these markets showed improvement, the revenue contribution from the industrial market was below expectations due to extreme pricing pressure that caused us to decline certain projects due to unacceptable pricing levels. We believe that market indicators and quotation levels continue to suggest that our markets have stabilized and in some areas showed improvement. We continue to see a higher level of international quotations, particularly in our power generation and high voltage transmission products.

The Electrical and Industrial Products Segment ended fiscal 2005 with a backlog of $64.8 million, an increase of 22% as compared to fiscal 2004 backlog of $53.1 million. The segment recorded a book-to-ship ratio

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of 1.08 to 1 for fiscal 2005 as compared to 1.03 to 1 in the prior year. In fiscal 2005, we continued our efforts to improve our market coverage and expand our served markets. Competition in the segment remains intense due to the imbalance between supply and demand, and we continue to see aggressive price initiatives from our competitors. Our concern going into fiscal 2006 is whether we will see a slowdown in the domestic economy and that competitors will continue to strive to maintain market share and increase capacity utilization using price as the primary vehicle. The following table reflects bookings and shipments for fiscal 2005 and 2004.

Backlog Table

(In thousands)

Our Galvanizing Services Segment, which is made up of eleven hot dip galvanizing facilities, generated revenues of $51.9 million, a 10% increase from the prior year’s revenues of $47.3 million. The increased revenue resulted from a slight improvement in pricing and an 8% increase in the pounds of steel produced in fiscal 2005 as compared to fiscal 2004. The increase in volume was due to the improved geographical markets in which our facilities are located and the resurgence of galvanizing for the telecommunication markets. Revenues for this segment have historically followed the condition of the general industrial economy. Any sustained improvement of the general industrial economy should produce improved results for this segment.

Segment Operating Income

The following table reflects the breakdown of total operating income by segment:

Our consolidated operating income (see note 11 to Notes to Consolidated Financial Statements) increased 12% to $16.8 million in fiscal 2005 as compared to $15 million in fiscal 2004. Consolidated operating margins as a percentage of sales were consistent for the compared periods at 11%. We continue to place emphasis on systems and procedures and the sharing of best practices among our operations to further enhance operating efficiency. We are in the process of implementing Oracle’s Enterprise Resource Planning (ERP) system which should provide numerous efficiencies once the conversion is completed in fiscal 2006. The Electrical and Industrial Products Segment generated 43% of the operating income for fiscal 2005, while the Galvanizing Services Segment produced the remaining 57%.

Operating income for the Electrical and Industrial Products Segment increased $919,000 or 14% for fiscal 2005, to $7.3 million as compared to $6.4 million for fiscal 2004. Operating margins for this segment were unchanged at 7.2% for the compared periods. Operating efficiencies and leverage obtained from increased revenues during fiscal 2005 were offset by increased material costs, primarily copper, aluminum, and steel. As result of competitive pricing pressure in this segment’s markets, we were unable to recoup these costs through price increases to our customers. We continue to align and consolidate resources to match current market conditions, while still maintaining its ability to capitalize on opportunities that arise. Despite improved market conditions, we believe that we will continue to see very competitive pricing in fiscal 2006 due to excess capacity.

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Operating income for the Galvanizing Service Segment increased $914,000 or 11% for fiscal 2005, to $9.5 million as compared to $8.6 million for the prior year. The operating income improvement is attributable to a 10% increase in revenues. This segment continues to benefit from the sizing of its operations to match market conditions. Operating margins were consistent at 18% for fiscal 2005 and 2004. The additional margin obtained from the resizing of the organization and the leverage achieved from increased revenue were offset by the increased commodity cost of zinc. The recent metal commodity pricing, including the cost of zinc, continues to be a concern. The increase in zinc costs could have a significant impact on margins if economic factors inhibit our ability to pass this increased cost on to our customers. It is difficult to determine at this time what the overall customer reaction will be to our attempted recovery of the increased cost of zinc. The increasing cost of zinc is a critical factor that impacts all participants in the hot dip galvanizing business.

General Corporate Expense

General corporate expenses were $7.7 million for fiscal 2005 and $5.9 million for fiscal 2004. As a percentage of sales, general corporate expenses were 5.1% for fiscal 2005 as compared to 4.3% in fiscal 2004. The percentage increase results in part from implementation cost of Oracle’s ERP system that could not be capitalized and Sarbanes Oxley compliance cost, which combined totaled $775,000 for fiscal 2005.

Interest expense for fiscal 2005 was $1.6 million, a decrease of 32% as compared to $2.4 million in fiscal 2004. The decrease in interest expense resulted from significant reductions of our average outstanding debt throughout fiscal 2005. Our total outstanding bank debt of $29.4 million at the end of 2005 was $1.5 million less than the $30.9 million outstanding at the end of fiscal 2004. Our long-term debt to equity ratio improved to .32 to 1 for fiscal 2005 as compared to .37 to 1 for fiscal 2004.

Other (Income) Expense

For fiscal 2005 the amounts in other (income) expense (see Note 11 of Notes to Consolidated Financial Statements) were insignificant. Fiscal 2004 included the amount of $298,000 for gain on the sale of vacant land, which was not specifically identifiable to a segment.

Provision For Income Taxes

The provision for income taxes reflects an effective tax rate of 35% for fiscal 2005 and 38% for fiscal 2004. The decrease in the effective tax resulted from a difference in the mix of profits generated from our operating facilities located in varying tax jurisdictions, which impacted our effective tax rate for current and deferred taxes.

Year ended February 29, 2004 (2004) compared with year ended February 28, 2003 (2003)

Revenues

The following table reflects the breakdown of revenue by segment:

Our consolidated net revenues for fiscal 2004 decreased by $47.2 million or 26%, as compared to fiscal 2003.

The Electrical and Industrial Products Segment recorded revenues for fiscal 2004 of $88.9 million, a decrease of 34% below our fiscal 2003 results of $134.9 million. The reduced revenues result primarily from

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lower demand from the domestic power generation market in fiscal 2004 as compared to fiscal 2003. During this period, this segment worked through the backlog that was related to the domestic power generation projects. In addition to the lack of new domestic power generation projects, the low capital spending levels in the industrial market in fiscal 2004 had a negative impact on this segment’s revenues. We continued in fiscal 2004 to intensify our efforts to increase our presence in international markets and improve our position in industrial and utility markets through improvements in this segment’s distribution networks. As a result of the increased efforts in the international market, a co-branding and co-operative agreement with Jiangsu Changjiang Electric Group Co., Ltd. of China was signed in fiscal 2004.

The Electrical and Industrial Products Segment ended fiscal 2004 with a backlog of $53.1 million, an increase of 8% as compared to fiscal 2003 backlog of $49.1 million. The backlog continued to be heavily weighted towards the distribution market in fiscal 2004. The backlog was aided by bookings for this segment’s high voltage bus duct product during fiscal 2004. The following table reflects bookings and shipments for the compared periods of fiscal 2004 and 2003.

Backlog Table

(In thousands)

Our Galvanizing Services Segment generated revenues of $47.3 million, a 3% decrease from the prior year’s revenues of $48.5 million. The decline in revenue for fiscal 2004 was created by the increase in steel prices during the fourth quarter, which impacted many of our steel fabrication customers and delayed some scheduled projects. Due to this segment’s broad customer base, and multiple locations, we were able to minimize the impact of the increased steel prices on segment operations.

Segment Operating Income

The following table reflects the breakdown of total operating income by segment:

Our consolidated operating income decreased 37% to $15 million in fiscal 2004 as compared to $23.8 million in fiscal 2003. Consolidated operating margins as a percent of sales declined in fiscal 2004 to 11% as compared to fiscal 2003 operating margins of 13%. The decline in operating income and margins was the direct result of lower revenues, primarily in the Electrical and Industrial Products Segment, as well as intense competition in both of our segments. We resized our operations in both operating segments to reflect the extremely competitive conditions facing each. The Electrical and Industrial Products Segment generated 42% of the operating income for fiscal 2004, while the Galvanizing Services Segment produced the remaining 58%.

Operating income for the Electrical and Industrial Products Segment declined $8.5 million or 57% for fiscal 2004, to $6.4 million as compared to $14.9 million for fiscal 2003. Operating margins for this segment declined

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to 7.2% for the current year as compared to 11% for fiscal 2003. The operating profits and margins were significantly impacted by a 34% reductions in revenues coupled with continued price competition within the markets in which these products are sold. While we continued to implement operational efficiencies and cost reductions we could not offset the dramatic reductions in revenues.

Operating income for the Galvanizing Service Segment declined $321,000 or 4% for fiscal 2004, to $8.6 million as compared to $9 million for the prior year. Operating margins were consistent at 18% for the compared periods of fiscal 2004 and 2003. The operating income decline is attributable to a slight reduction in revenues and increased cost for natural gas.

General Corporate Expense

General corporate expenses were $5.9 million for fiscal 2004 and fiscal 2003. As a percentage of sales, general corporate expenses were 4.3% for fiscal 2004 as compared to 3.2% in fiscal 2003. The percentage increase results from a 26% reduction in revenues for fiscal 2004.

Interest expense for fiscal 2004 was $2.4 million, a decrease of 39% as compared to $3.9 million in fiscal 2003. The decrease in interest expense resulted from significant reductions of outstanding debt and record low interest rates on our variable debt instruments. We ended fiscal 2004 with outstanding bank debt of $30.9 million, a decrease of 31% or $13.7 million as compared to the $44.6 million outstanding at the end of fiscal 2003. Our long-term debt to equity ratio improved to .37 to 1 for fiscal 2004 as compared to .60 to 1 for fiscal 2003.

Other (Income) Expense

Other income was recorded in the amount of $193,000 for fiscal 2004 as compared to other expense that was recorded in the amount of $122,000 for fiscal 2003. The other income in 2004 related to gains that were recorded in the amount of $298,000 for the sale of vacant land, which was not specifically identifiable to a segment.

Provision For Income Taxes

The provision for income taxes reflects an effective tax rate of 38% for fiscal 2004 and 2003.

Liquidity and Capital Resources

We have historically met cash needs through a combination of cash flows from operating activities and bank borrowings. Our cash requirements are generally for operating activities, capital improvements, debt repayment and acquisitions. We believe that working capital, borrowing capabilities, and funds generated from operations should be sufficient to finance anticipated operational activities, capital improvements, debt repayment and possible future acquisitions.

Our operating activities generated cash flows of approximately $6.4 million, $15 million, and $22.9 million during fiscal 2005, 2004, and 2003, respectively. Cash flow from operations in fiscal 2005 included net income in the amount of $4.8 million, depreciation and amortization of intangibles and debt issue costs in the amount of $5.9 million, and net changes in operating assets and liabilities and other increases in cash flows from operations of a negative $4.3 million. Due to increased business levels in both our segments, our working capital requirements were increased in fiscal 2005 as compared to fiscal 2004. As a result of the increased levels of business accounts receivable, inventories, revenues in excess of billings, and prepaid and other assets balances increased by $4.5 million, $1.9 million, $2.1 million, and $200,000, respectively in fiscal 2005 over 2004. Accounts receivable days outstanding for fiscal 2005 were 57 days as compared to 58 days in fiscal 2004. Inventory turns were 7.5 times for fiscal 2005 as compared to 7 times in fiscal 2004. The decrease in cash flow from increases in accounts receivable, inventories, and revenue in excess of billings was partially offset by increases in accounts payable and accrued

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liabilities, and prepaid and other assets in the amount of $2.5 million and $600,000, respectively. Increases in cash flows from changes in deferred tax liabilities, provision for bad debt, and other non-cash transactions accounted for the remaining $1.4 million net change in operating assets and liabilities.

During fiscal 2005, cash flow from operations was used to make capital improvements of $6.6 million and to reduce debt by $1.5 million. The breakdown of capital spending by segment for fiscal 2005, 2004, and 2003 can be found in Note 11 of the Notes to Consolidated Financial Statements. In the fourth quarter of fiscal 2004, we began the implementation of a new ERP system, which is scheduled for completion in fiscal 2006. The capital expenditures in fiscal 2005 were $2.1 million for the ERP system as compared with $860,000 for fiscal 2004, and it is estimated that additional capital outlay of approximately $600,000 will be incurred in fiscal 2006 to complete the implementation. We received proceeds from the sale of property and equipment and proceeds from the exercise of stock options in the total amount of $816,000. There were no cash dividends declared or paid in fiscal 2005, and no resumption of a cash dividend is currently anticipated.

On November 1, 2001, we entered into an Amended and Restated Revolving and Term Loan Credit Agreement (the “2001 Credit Agreement”), which replaced the previous term notes and revolving line of credit. The new agreement included a $40 million term facility and a $45 million revolving credit facility. Since November 1, 2001, the Company amended the 2001 Credit Agreement to reduce the number of banks participating from five to three banks, reduce the Company’s revolving credit facility from $45 million to $20 million, extend the maturity of the revolving line of credit to June 30, 2008, extend the maturity and amortization of the term facility to March 31, 2008, and revise the provisions of various financial covenants. These financial covenants consist of 1) Minimum Consolidated Net Worth 2) Maximum Leverage Ratio and 3) Minimum Fixed Charge Coverage Ratio. As of February 28, 2005, we were in compliance with all debt covenants. The availability under the revolving credit facility is contingent on asset-based collateral of inventories and accounts receivable. At February 28, 2005, we had $17.9 million outstanding under the term note and $11.5 million outstanding under the revolving credit facility. The remaining balance outstanding on the term-loan is payable in quarterly installments of $1.375 million through March 2008. At February 28, 2005, we had approximately $6.8 million of additional credit available under our revolving credit facility.

Borrowings under the term note and revolving line of credit bear interest at a rate per annum equal to the lesser of the base rate plus the applicable margin for the base rate borrowings for the applicable facility, or the adjusted Eurodollar rate plus the applicable margin for Eurodollar rate borrowings for the applicable facility. The applicable margin is based on the leverage ratio, which was 1.5% at February 28, 2005, and correlated to an interest rate of 4.95% on the hedged portion of the note and 4.30% on the variable portion of the note at February 28, 2005. Additionally, we are obligated to pay a commitment fee based on the leverage ratio at a rate ranging from .25% to .5% on the unused revolving credit facility

We use interest rate protection agreements to moderate the effects of increases, if any, in interest rates by swapping debt from a variable rate to a fixed rate. As of February 28, 2005 we have two outstanding interest rate swaps. Under the first swap agreement (the “1999 Swap Agreement”) which matures in February 2006, we pay a fixed rate of 6.8% in exchange for a variable 30-day LIBOR rate plus 1.25% (3.84% at February 28, 2005). The notional amount of the swap was originally designed to correspond to the maturities of our term debt that was outstanding in 1999, and at February 28, 2005, the remaining notional amount was $1.4 million. Prior to November 2001, this swap was treated as a cash flow hedge of our variable interest rate exposure. However, we refinanced our credit agreement in November 2001 and chose to cease the hedge designation for the 1999 Swap Agreement while keeping it in effect. Since that time, we have been recognizing changes in the fair value of this swap directly in earnings, while amortizing the pretax amount included in accumulated other comprehensive income as additional interest expense. For the fiscal years 2005 and 2004, we amortized $73,000 as additional interest expense for each year and recognized mark to market gains of $102,000 and $130,000, respectively, for subsequent changes in the fair value of this swap. At February 28, 2005, the fair value of the 1999 Swap Agreement was a liability of $19,000, and a loss of $42,000, net of tax, remains in accumulated other comprehensive income to be amortized as additional interest expense.

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In conjunction with our debt refinancing in November 2001, we entered into a new interest rate swap (the “2001 Swap Agreement”) as a cash flow hedge of our variable interest expense related to the term note. Under the 2001 Swap Agreement we exchanged interest rate obligations from November 2001 through November 2005, of a fixed rate of 4.95% for a variable 30-day LIBOR rate plus 1.50% (4.25% at February 28, 2005). The notional amount of this swap matures in stages and as of February 28, 2005, the remaining notional amount was $7.5 million and the swap matures in November 2005. To date there has been no ineffectiveness related to the 2001 Swap Agreement. At February 28, 2005, the fair value of the 2001 Swap Agreement was a liability of $21,000, and a loss of $13,000, net of tax, is included in accumulated other comprehensive income.

Given the maturity dates of the interest rate swaps, all amounts included in accumulated other comprehensive income are expected to flow through earnings by the end of fiscal 2006.

Subsequent to February 28, 2005, we entered into a new interest rate protection agreement (the “2005 Swap Agreement”) as a cash flow hedge of the variable interest expense related to the term note. Under the 2005 Swap Agreement we exchange interest rate obligations from March 31, 2005 through March 31, 2008 whereby we pay a fixed rate of 5.95% for a variable 30-day LIBOR plus 1.50% (4.35% at March 31, 2005). The notional amount of the swap matures in stages. The notional amount was $9 million at Mach 31, 2005 and matures on March 31, 2008.

Our current ratio (current assets/current liabilities) was 1.94 to 1 at the end of fiscal 2005, as compared to 1.86 to 1 at the end of fiscal 2004. Shareholder equity grew 9% during fiscal 2005 to $75.3 million or $13.84 (shareholders’ equity/weighted average shares outstanding at February 28, 2005) per share. Long-term debt as a percentage of shareholders’ equity was 32% at the end of fiscal 2005 as compared to 37% at the end of fiscal 2004. The decrease in long-term debt as a percentage of shareholders’ equity was the result of a reduction in debt of $1.5 million and increased shareholders’ equity of $6 million. The funds used for debt repayment came from cash flows generated from operations.

We have not experienced significant impacts on our operations from increases in general inflation other than for specific commodities and employee health care costs. We have exposure to commodity price increases in both segments of our business, primarily zinc in the Galvanizing Services Segment and copper, aluminum and steel in the Electrical and Industrial Products Segment. We attempt to minimize these increases through protective caps purchased on zinc and escalation clauses in customer contracts for copper, aluminum and steel, when market conditions allow. In addition to these measures, we attempt to recover other cost increases through improvements to our manufacturing process and through increases in prices where competitively feasible.

Off Balance Sheet Transactions and Related Matters

There are no off-balance sheet transactions, arrangements, obligations (including contingent obligations), or other relationships of the Company with unconsolidated entities or other persons that have, or may have, a material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Contractual Commitments

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Long-term debt and letters of credit

As of February 28, 2005, we had outstanding debt in the amount of $29.4 million, which consisted of a $17.9 million term note and $11.5 million outstanding under the revolving credit facility. For further information regarding our long-term debt obligations and interest rate protection agreements see “Liquidity and Capital Resources” above and footnote 10 of the Notes to the Consolidated Financial Statements found on page 38. Maturities of long-term debt and the related interest, which are based on rates as of February 28, 2005, are summarized in the above table.

At November 30, 2004, we had outstanding letters of credit in the amount of $1.7 million. These letters of credit are issued to some customers to cover any potential warranty costs that the customer might incur. In addition, as of February 28, 2005, a warranty reserve in the amount of $1 million has been established to offset any future warranty claims.

Leases

We lease various facilities under non-cancelable operating leases with an initial term in excess of one year. The future minimum payments required under these operating leases as of February 28, 2005 are summarized in the above table. Rental expense for real estate and personal property was approximately $2,071,000, $2,060,000, and $2,150,000 for fiscal years ended 2005, 2004 and 2003, respectively, and includes all short-term as well as long-term rental agreements.

Commodity pricing

We manage our exposure to commodity prices in both of our business segments. In the Galvanizing Services Segment, we utilize agreements with zinc suppliers that include protective caps. These agreements typically are negotiated in December of each year and normally are for a twelve-month period of time. We also secure firm pricing for natural gas supplies with individual utilities when possible. There are no contracted volume purchase commitments associated with the zinc or natural gas agreements. Management believes these agreements ensure adequate supplies and partially offset exposure to commodity price swings. In the Electrical and Industrial Products Segment, we have exposure to commodity pricing for copper, aluminum, and steel. Because the Electrical and Industrial Products Segment does not commit contractually to minimum volumes, increases in price for these items are normally managed through escalation clauses in our customer’s contracts, although during difficult market conditions these escalation clauses may not be readily obtainable. We do not have contracted purchase commitments for any other commodity items including steel, aluminum, natural gas, zinc, or copper or other commodities.

Critical Accounting Policies and Estimates

The preparation of the consolidated financial statements requires us to make estimates that affect the reported value of assets, liabilities, revenues and expenses. Our estimates are based on historical experience and various other factors that we believe reasonable under the circumstances, and form the basis for our conclusions. We continually evaluate the information used to make these estimates as business and economic conditions change. Accounting policies and estimates considered most critical are allowances for doubtful accounts, accruals for contingent liabilities, revenue recognition and impairment of long-lived assets, identifiable intangible assets and goodwill. Actual results may differ from these estimates under different assumptions or conditions. The development and selection of the critical accounting policies and the related disclosures below have been reviewed with the Audit Committee of the Board of Directors. More information regarding significant accounting policies can be found in Note 1 of the Notes to Consolidated Financial Statements

Allowance for Doubtful Accounts- The carrying value of our accounts receivable is continually evaluated based on the likelihood of collection. An allowance is maintained for estimated losses resulting from our

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customer’s inability to make required payments. The allowance is determined by historical experience of uncollected accounts, the level of past due accounts, overall level of outstanding accounts receivables, information about specific customers with respect of their inability to make payments and future expectations of conditions that might impact the collectibility of accounts receivables. If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required.

Accruals for Contingent Liabilities- The amounts we record for estimated claims, such as self insurance programs, warranty and other contingent liabilities, requires us to make judgments regarding the amount of expenses that will ultimately be incurred. We use past history and experience, as well as other specific circumstances surrounding these claims in evaluating the amount of liability that should be recorded. Actual results may be different than we estimate.

Revenue Recognition- We recognize revenue for the Galvanizing Services Segment upon completion of the galvanizing process performed on the customers’ material or shipment of this material. Revenue is recognized for the Electrical and Industrial Products Segment upon transfer of title and risk to customers, or based upon the percentage of completion method of accounting for electrical products built to customer specifications under long term contracts. Deferred revenue presented in the balance sheet arises from advanced payments received from our customers prior to shipment of the product and are not related to revenue recognized under the percentage of completion method. The extent of progress for revenue recognized using the percentage of completion method is measured by the ratio of contract costs incurred to date to estimated total contract costs at completion. Contract costs include direct labor and material, and certain indirect costs. Selling, general and administrative costs are charged to expense as incurred. Provisions for estimated losses, if any, on uncompleted contracts are made in the period in which such losses are able to be determined. The assumptions made in determining the estimated cost could differ from actual performance resulting in a different outcome for profits or losses than anticipated.

Impairment of Long-Lived Assets, Identifiable Intangible Assets and Goodwill- We record impairment losses on long-lived assets, including identifiable intangible assets, when events and circumstances indicate that the assets might be impaired and the undiscounted projected cash flows associated with those assets are less than the carrying amounts of those assets. In those situations, impairment losses on a long-lived assets are measured based on the excess of the carrying amount over the asset’s fair value, generally determined based upon discounted estimates of future cash flows. A significant change in events, circumstances or projected cash flows could result in an impairment of long-lived assets, including identifiable intangible assets.

Due to depressed cyclical demand, certain operations of the Electrical and Industrial Products Segment have been operating at approximately break-even levels. We believe our operating plans to increase market share and improve operating efficiencies, and a recovery in the cyclical demand for products will improve these operations performance. However, should demand deteriorate further, we could be required to recognize an impairment.

An annual impairment test of goodwill is performed in the fourth quarter of each year. The test is calculated using the anticipated future cash flows from our operating segments. Based on the present value of the future cash flow, we will determine whether impairment may exist. A significant change in projected cash flows or cost of capital for future years could result in an impairment of goodwill in future years.

Variables impacting future cash flows include, but are not limited to, the level of customer demand for and response to products and services we offer to the power generation market, the electrical transmission and distribution markets, the general industrial market and the hot dip galvanizing market; changes in economic conditions of these various markets; raw material and natural gas costs; and availability of experienced labor and management to implement our growth strategies.

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Recent Accounting Pronouncements

In December 2004, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 123R, Share-Based Payment, which will revise FASB Statement No. 123, Accounting for Stock-based Compensation and supersedes APB No. 25 Accounting for Stock Issued to Employees. FAS 123R will be effective for the Company’s first quarter of fiscal 2007. FAS 123R will require that compensation cost be recognized in the financial statements not only for new awards but for previously granted awards that are not fully vested on the adoption date. We are still evaluating the provisions of FAS 123R; however, we believe the effects should be relatively consistent with the pro forma net income and earnings per share data we have disclosed on page 31 of Note 1 to the consolidated financial statements

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market risk affecting our operations results primarily from changes in interest rates and commodity prices. We have only limited involvement with derivative financial instruments and are not a party to any leveraged derivatives.

We manage our exposures to changes in interest rates by optimizing the use of variable and fixed rate debt. We had approximately $21.875 million of variable rate borrowings at February 28, 2005 after hedges. On our variable interest rate borrowings, a one percent upward or downward change in interest rates would equate to an approximate $219,000 increase or decrease to interest expense. In February 1999, we entered into an interest rate protection agreement, (the “1999 Swap Agreement”) which matures in February 2006, whereby we pay a fixed rate of 6.8% in exchange for a variable 30-day LIBOR rate plus 1.25% (3.84% at February 28, 2005). The notional amount of the swap was originally designed to correspond to the maturities of our term debt that was outstanding in 1999, and at February 28, 2005, the remaining notional amount was $1.4 million. Prior to November 2001, this swap was treated as a cash flow hedge of our variable interest rate exposure. However, we refinanced our credit agreement in November 2001 and chose to cease its hedge designation for the 1999 Swap Agreement while not terminating the swap agreement. Since that time, we have been recognizing changes in the fair value of this swap directly in earnings, while amortizing the pretax amount included in accumulated other comprehensive income as additional interest expense. For the fiscal years 2005 and 2004, we amortized $73,000 as additional interest expense for each year and recognized mark-to-market gains of $102,000 and $130,000, respectively, for subsequent changes in the fair value of this swap. At February 28, 2005, the fair value of the 1999 Swap Agreement was a liability of $19,000, and a loss of $42,000, net of tax, remains in accumulated other comprehensive income to be amortized as additional interest expense.

In conjunction with the debt refinancing in November 2001, we entered into a new interest rate swap (the “2001 Swap Agreement”) as a cash flow hedge of variable interest expense related to the term note. Under the 2001 Swap Agreement we exchanged interest rate obligations from November 2001 through November 2005, of a fixed rate of 4.95% for a variable 30-day LIBOR rate plus 1.50% (4.25% at February 28, 2005). The notional amount of this swap matures in stages and as of February 28, 2005, the remaining notional amount was $7.5 million and matures in November 2005. To date there has been no ineffectiveness related to the 2001 Swap Agreement. At February 28, 2005, the fair value of the 2001 Swap Agreement was a liability of $21,000, and a loss of $13,000, net of tax, is included in accumulated other comprehensive income.

Given the maturity dates of these two interest rate swaps, all amounts included in accumulated other comprehensive income are expected to flow through earnings by the end of fiscal 2006.

Subsequent to February 28, 2005, we entered into a new interest rate protection agreement (the “2005 Swap Agreement”) as a cash flow hedge of variable interest expense related to our term note. Under the 2005 Swap Agreement we exchanged interest rate obligations from March 31, 2005 through March 31, 2008 of a fixed rate of 5.95% for a variable 30-day LIBOR plus 1.50% (4.35% at March 31, 2005). The notional amount of the swap matures in stages. The notional amount was $9 million at March 31, 2005 and matures on March 31, 2008.

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We manage our exposures to commodity prices, primarily zinc used in its Galvanizing Services Segment, by utilizing agreements with zinc suppliers that include protective caps to guard against rising commodity prices. We believe these agreements ensure adequate supplies and partially offset exposure to commodity price swings. In the Electrical and Industrial Segment, we have exposure to commodity pricing for copper, aluminum, and steel. Increases in price for these items are normally managed through escalation clauses to our customer’s contracts, although during difficult market conditions these escalation clauses may not be readily obtainable.

We do not believe that a hypothetical change of 10% of the interest rate currently in effect or a change of 10% of commodity prices would have a significantly adverse effect on our results of operations, financial position, or cash flows. However, there can be no assurance that either interest rates or commodity prices will not change in excess of that hypothetical amount.

Item 8. Financial Statements and Supplementary Data

The index to our Consolidated Financial Statements is found on page 22. Our Financial Statements and Notes to these Consolidated Financial Statements follow the index.

Item 9. Disagreements on Accounting and Financial Disclosure

No changes in accountants or disagreements with accountants on accounting and/or financial disclosure have arisen.

Item 9a. Controls and Procedures

As of February 28, 2005, an evaluation was performed by management under the supervision and with the participation of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) of the effectiveness of the Company’s disclosure controls and procedures. Management necessarily applied its judgement in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding management’s control objectives. Based on that evaluation, our CEO and CFO concluded that the Company’s disclosures controls and procedures were effective in timely alerting them to material information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act and in assuring the Company that such information is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms.

We are in the process of implementing an enterprise resource system (“ERP” system) developed by Oracle to replace our legacy computer system and are making appropriate changes to internal controls and procedures as the implementation progresses. Other than the changes required by the implementation of the Oracle ERP system, none of which materially impaired or significantly altered the effectiveness of our internal controls and procedures over financial reporting, there were no material changes in our internal controls over financial reporting that occurred during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

While we believe that its existing disclosure controls and procedures have been effective to accomplish their objectives, we intend to continue to examine, refine and document its disclosures controls and procedures and to monitor ongoing developments in this area. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company has been detected.

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PART III

Item 10. Directors and Executive Officers

The information required by this item with regard to executive officers is included in Part I, Item 1 of this report under the heading “Executive Officers of the Registrant.”

Information regarding directors of AZZ required by this Item is incorporated be reference to the section entitled “Election of Directors” set forth in our Proxy Statement for our 2005 Annual Meeting of Shareholders.

The information regarding compliance with Section 16(a) of the Securities Exchange Act of 1934 required by this Item is incorporated by reference to the section entitled “Section 16(a) Beneficial Ownership Reporting Compliance” set forth in our Proxy Statement for its 2005 Annual Meeting of Shareholders.

Information regarding our audit committee financial experts and code of ethics and business conduct required by this item is incorporated by reference to the section entitled “Matters Relating to Corporate Governance, Board Structure, Director Compensation and Stock Ownership” set forth in our Proxy Statement for its 2005 Annual Meeting of Shareholders.

No director or nominee for director has any family relationship with any other director or nominee or with any executive officer of our company.

Item 11. Executive Compensation

The information required by this Item is incorporated herein by reference to the section entitled “Executive Compensation” and the section entitled “Matters Relating to Corporate Governance, Board Structure, Director Compensation and Stock Ownership—Fees Paid to Directors” set forth in our Proxy Statement for its 2005 Annual Meeting of Shareholders.

Item 12. Security Ownership of Certain Beneficial Owners and Management

The information required by this Item is incorporated herein by reference to the section entitled “Executive Compensation” and the section entitled “Matters Relating to Corporate Governance, Board Structure, Director Compensation and Stock Ownership—Security Ownership of Management” set forth in our Proxy Statement for its 2005 Annual Meeting of Shareholders.

Equity Compensation Plans

The following table provides a summary of information as of February 28, 2005, relating to our equity compensation plans in which our common stock is authorized for issuance.

Equity Compensation Plan Information

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Description of Other Plans for the Grant of Equity Compensation

The following are plans under which shares of our Common Stock have been reserved for issuance as compensation to our Independent Directors and Advisory Directors. The shares covered by those plans are not included in the table above on equity compensation plans because they do not provide for options, warrants or rights.

1999 Independent Director Share Ownership Plan

On January 19, 1999, the Board of Directors established the 1999 Independent Director Share Ownership Plan (as amended, the “Independent Director Plan”). Each independent Directors was granted 500 shares of our Common Stock after each annual meeting of the shareholders, beginning with the 1999 Annual Meeting and continuing until the 2004 Annual Meeting, at which time the number of shares granted increased to 1,000 shares, after which he continued to serve as director. Also, under the Plan, each newly elected independent Director who has not previously served on the Board is granted such number of shares as the Board of Directors may deem appropriate, but not less than 1,000 shares of Common Stock or, if less, Common Stock having a value of $15,000. Grants under the Independent Director Plan terminate as to each Independent Director when a total of 5,000 shares have been granted to him or her. During their tenure on the Board of Directors, each Director is to retain a number of shares equal to at least one-half the number of shares granted pursuant to the Independent Director Plan. A total of 50,000 shares were covered by the Plan, of which 21,000 shares remain available under the Plan at February 28, 2005.

2000 Advisory Director Share Ownership Plan

On March 28, 2000, the Board of Directors established the 2000 Advisory Director Share Ownership Plan (the “Advisory Director Plan”). Under that Plan, Advisory Directors receive a grant of 500 shares of Common Stock of the Company after each annual shareholders meeting after which they continue to serve as an Advisory Director until they receive a total of 5,000 shares, including shares received while serving as an active member of the Board of Directors. A total of 10,000 shares were covered by the Plan, of which, 6,500 shares remain available under the Plan at February 28, 2005. The Board has no Advisory Directors at the present time and has no plans to add Advisory Directors in the future.

Item 13. Certain Relationships and Related Transactions

The information required by this Item is incorporated by reference to the section entitled “Certain Relationships and Related Party Transactions” set forth in our Proxy Statement for our 2005 Annual Meeting of Shareholders.

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PART IV

Item 14. Principal Accounting Fees and Services

Information required by this Item is incorporated by reference to the sections entitled “Other Business—Independent Auditor Fees” and “Other Business—Pre-approval of Nonaudit Fees” set forth in our Proxy Statement for our 2005 Annual Meeting of Shareholders.

Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K

A. Financial Statements

1. The financial statements filed as a part of this report are listed in the “Index to Consolidated Financial Statements” on page 22.

2. Financial Statements Schedules

Schedule II—Valuation and Qualifying Accounts and Reserves filed as a part of this report is listed in the “Index to Consolidated Financial Statements” on page 22.

Schedules and compliance information other than those referred to above have been omitted since the required information is not present or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the consolidated financial statements and the notes thereto.

B. Exhibits Required by Item 601 of Regulation S-K

A list of the exhibits required by Item 601 of Regulation S-K and filed as part of this report is set forth in the Index to Exhibits beginning on page 44, which immediately precedes such exhibits.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, AZZ has duly caused this report to be signed on our behalf by the undersigned thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of AZZ and in the capacities and on the dates indicated.

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I ndex to Consolidated Financial Statements and Schedules

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Report of Independent Registered Public Accounting Firm

Board of Directors and Shareholders

AZZ incorporated

We have audited the accompanying consolidated balance sheets of AZZ incorporated as of February 28, 2005 and February 29, 2004, and the related consolidated statements of income, shareholders’ equity, and cash flows for each of the three years in the period ended February 28, 2005. Our audits also included the financial statement schedule listed in the Index at Item 15A.2. These financial statements and financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of AZZ incorporated at February 28, 2005 and February 29, 2004, and the consolidated results of its operations and its cash flows for each of the three years in the period ended February 28, 2005, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the financial statement schedule, referred to above, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

/s/ Ernst & Young LLP

Fort Worth, Texas

March 31, 2005

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AZZ incorporated

CONSOLIDATED STATEMENTS OF INCOME

Years ended February 28, 2005, February 29, 2004 and February 28, 2003

See accompanying notes.

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AZZ incorporated

CONSOLIDATED BALANCE SHEETS

February 28, 2005 and February 29, 2004

See accompanying notes.

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AZZ incorporated

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years ended February 28, 2005, February 29, 2004 and February 28, 2003

See accompanying notes.

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AZZ incorporated

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

Years ended February 28, 2005, February 29, 2004 and February 28, 2003