SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 - For the fiscal year ended December 31, 2003

Commission file number 1-13905

COMPX INTERNATIONAL INC.
(Exact name of registrant as specified in its charter)

Delaware                                            57-0981653     
-------------------------------                           --------------------
(State or other jurisdiction of                              (IRS Employer
incorporation or organization)                            Identification No.)

5430 LBJ Freeway, Suite 1700, Dallas, Texas                     75240-2697    
-----------------------------------------------           --------------------
(Address of principal executive offices)                     (Zip Code)

Registrant's telephone number, including area code:          (972) 448-1400   
--------------------

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

Name of each exchange on
Title of each class                           which registered
-------------------                        ------------------------
Class A common stock                       New York Stock Exchange
($.01 par value per share)

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 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.

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 4.7 million  shares of voting stock held by
nonaffiliates of CompX International Inc. as of June 30, 2003 approximated $26.1
million.

As of  January  30,  2004,  5,124,780  shares  of  Class  A  common  stock  were
outstanding.

Documents incorporated by reference
-----------------------------------

The  information  required by Part III is  incorporated  by  reference  from the
Registrant's definitive proxy statement to be filed with the Commission pursuant
to  Regulation  14A not later  than 120 days  after the end of the  fiscal  year
covered by this report.

PART I

ITEM 1.   BUSINESS

General

CompX International Inc. (NYSE: CIX) is a leading manufacturer of precision
ball bearing slides,  security  products and ergonomic  computer support systems
used in office furniture,  computer-related  applications and a variety of other
industries. The Company's products are principally designed for use in medium to
high-end product applications, where design, quality and durability are critical
to the Company's  customers.  The Company  believes that it is among the world's
largest producers of precision ball bearing slides, security products consisting
of cabinet locks and other locking  mechanisms  and ergonomic  computer  support
systems. In 2003, precision ball bearing slides, security products and ergonomic
computer  support systems  accounted for  approximately  45%, 37% and 14% of net
sales,  respectively.  The remaining  sales were  generated  from sales of other
products.

Valhi,  Inc.  and  Valhi's  wholly-owned   subsidiary  Valcor,  Inc.  owned
approximately  69% of the  Company's  outstanding  common  stock at December 31,
2003.  At December  31,  2003,  Contran  Corporation  held,  directly or through
subsidiaries,   approximately   90%  of  Valhi's   outstanding   common   stock.
Substantially  all of  Contran's  outstanding  voting  stock  is held by  trusts
established for the benefit of certain  children and  grandchildren of Harold C.
Simmons,  of which Mr.  Simmons is sole trustee.  Mr. Simmons is Chairman of the
Board of each of Contran,  Valhi and Valcor and may be deemed to control each of
such companies and CompX.

The Company was  incorporated  in Delaware in 1993 under the name  National
Cabinet Lock Inc. At that time, Valhi contributed the assets of its Cabinet Lock
Division and the stock of Waterloo Furniture  Components Limited to the Company.
In 1996, the Company changed its name to CompX  International  Inc. In 1998, the
Company issued  approximately 6 million shares of its common stock in an initial
public offering and CompX acquired two additional  security products  producers.
CompX acquired two more slide  producers in 1999 and another  security  products
producer in January 2000.

The  Company  maintains  a website  on the  internet  with the  address  of
www.compxnet.com.  Copies of this Annual  Report on Form 10-K for the year ended
December 31, 2003 and copies of the Company's Quarterly Reports on Form 10-Q for
2003 and 2004 and any  Current  Reports  on Form 8-K for 2003 and 2004,  and any
amendments  thereto,  are or  will  be  available  free  of  charge  as  soon as
reasonably  practical  after they are filed  with the  Securities  and  Exchange
Commission  ("SEC") at such website.  The general  public may also read and copy
any materials the Company files with the SEC at the SEC's Public  Reference Room
at 450 Fifth Street, NW, Washington, DC 20549, and may obtain information on the
operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The
Company is an electronic  filer,  and the SEC  maintains an internet  website at
www.sec.gov that contains reports, proxy and information  statements,  and other
information regarding issuers that file electronically with the SEC.

As  provided  by the  safe  harbor  provisions  of the  Private  Securities
Litigation  Reform Act of 1995, the Company cautions that the statements in this
Annual  Report on Form 10-K relating to matters that are not  historical  facts,
including,  but not limited to,  statements  found in this Item 1 -  "Business,"
Item 3 - "Legal Proceedings," Item 7 - "Management's  Discussion and Analysis of
Financial  Condition and Results of Operations" and Item 7A - "Quantitative  and
Qualitative Disclosures About Market Risk," are forward-looking  statements that
represent  management's  beliefs and  assumptions  based on currently  available
information.  Forward-looking  statements  can be identified by the use of words
such as "believes,"  "intends,"  "may,"  "should,"  "anticipates,"  "expects" or
comparable  terminology or by discussions of strategies or trends.  Although the
Company  believes  that  the  expectations  reflected  in  such  forward-looking
statements are reasonable, it cannot give any assurances that these expectations
will prove to be correct.  Such  statements by their nature involve  substantial
risks and uncertainties that could  significantly  impact expected results,  and
actual  future  results  could differ  materially  from those  described in such
forward-looking  statements.  Among the factors that could cause  actual  future
results to differ materially are the risks and  uncertainties  discussed in this
Annual Report and those  described from time to time in materials filed with the
Company's  other filings with the SEC.  While it is not possible to identify all
factors,  the Company continues to face many risks and uncertainties  including,
but not limited to, the following:

o    Future supply and demand for the Company's products,
o    Changes in costs of raw materials and other operating costs (such as energy
costs),
o    General global economic and political conditions,
o    Demand for office furniture,
o    Service industry employment levels,
o    The possibility of labor disruptions,
o    The ability to implement  headcount  reductions in a cost effective  manner
within the constraints of non-U.S. governmental regulations, and the timing
and amount of any cost savings,
o    Competitive  products  and prices,  including  increased  competition  from
low-cost manufacturing sources (such as China),
o    Substitute products,
o    Customer and competitor strategies,
o    The introduction of trade barriers,
o    The impact of pricing and production decisions,
o    Fluctuations in the value of the U.S.  dollar relative to other  currencies
(such as the euro, Canadian dollar and New Taiwan dollar),
o    Potential difficulties in integrating completed or future acquisitions,
o    Uncertainties associated with new product development,
o    Environmental  matters  (such as those  requiring  emission  and  discharge
standards for existing and new facilities),
o    The ultimate outcome of income tax audits,
o    The impact of current or future government regulations,
o    Possible future litigation and
o    Other risks and uncertainties.

Should one or more of these risks  materialize  (or the  consequences  of such a
development worsen) or should the underlying assumptions prove incorrect, actual
results could differ  materially from those forecasted or expected.  The Company
disclaims  any  intention  or  obligation  to update  publicly  or  revise  such
statements whether as a result of new information, future events or otherwise.

Industry Overview

Historically,  approximately  three-fourths of the Company's  products were
sold to the office furniture  manufacturing  industry.  As a result of strategic
acquisitions  in the  security  products  industry  in 1998  and 2000 and in the
precision  ball  bearing  slide  industry in 1999,  the Company has expanded its
product  offering and reduced its  percentage  of sales to the office  furniture
market.  Currently,  approximately 57% of the Company's products are sold to the
office furniture  manufacturing industry while the remainder are sold for use in
other  products,  such  as  vending  equipment,   electromechanical  enclosures,
transportation,  computers and related equipment, and other non-office furniture
applications.  Beginning  in 2001 and  continuing  throughout  2003,  the office
furniture  industry has  experienced a contraction  with  consistently  negative
growth rates.  Consequently,  CompX's sales growth has been negatively affected.
See Item 6 - "Selected Financial Data" and Item 7 - "Management's Discussion and
Analysis of Financial  Condition and Results of  Operations."  However,  CompX's
management believes that its emphasis on new product  development,  sales of its
ergonomic  computer support systems as well as slide and security  products used
in computer and other non-office  furniture  markets result in the potential for
higher  rates of growth and  diversification  of risk than the office  furniture
industry as a whole.

Products

CompX  manufactures  and sells  components  in three major  product  lines:
precision ball bearing slides,  security products and ergonomic computer support
systems.

Sales  for the  respective  product  lines  in  2001,  2002 and 2003 are as
follows:

Years ended December 31       
-----------------------------------------------
2001                2002                 2003
----                ----                 ----
($ in thousands)

Precision ball bearing slides                                  $ 91,822            $ 84,446             $ 92,816
Security products                                                74,071              73,358               76,155
Ergonomic computer support systems                               36,383              29,945               28,102
Other products                                                    9,146               8,352               10,470
--------            --------             --------

$211,422            $196,101             $207,543
========            ========             ========

The Company's  precision ball bearing slides and ergonomic computer support
systems are sold under the CompX Waterloo, Waterloo Furniture Components, Thomas
Regout and Dynaslide  brand names and the Company's  security  products are sold
under the CompX Security Products,  National Cabinet Lock, Fort Lock, Timberline
Lock,  Chicago  Lock,  STOCK  LOCKS,  KeSet and TuBar brand  names.  The Company
believes that its brand names are well recognized in the industry.

Precision  ball  bearing  slides.  CompX  manufactures  a complete  line of
precision  ball  bearing  slides for use in office  furniture,  computer-related
equipment,  tool  storage  cabinets,  imaging  equipment,  file  cabinets,  desk
drawers,  automated  teller  machines,  and other  applications.  These products
include  CompX's  patented  Integrated  Slide  Lock  in  which  a  file  cabinet
manufacturer  can reduce the possibility of multiple drawers being opened at the
same  time,  the  adjustable  patented  Ball  Lock  which  reduces  the  risk of
heavily-filled  drawers, such as auto mechanic tool boxes, from opening while in
movement,  and the  Butterfly  Take Apart  System,  which is  designed to easily
disengage drawers from cabinets.  Precision ball bearing slides are manufactured
to stringent  industry  standards and are designed in conjunction  with original
equipment  manufacturers ("OEMs") to meet the needs of end users with respect to
weight support capabilities, ease of movement and durability.

Security products.  The Company believes that it is a North American market
leader  in  the  manufacture  and  sale  of  cabinet  locks  and  other  locking
mechanisms.  CompX provides  security products to various  industries  including
institutional furniture,  banking,  industrial equipment,  vehicles, vending and
computer.  The  Company's  products  can also be found in  various  applications
including  ignition  systems,  office  furniture,  vending and gaming  machines,
parking  meters,  electrical  circuit  panels,  storage  compartments,  security
devices for laptop and desktop  computers as well as mechanical  and  electronic
locks for the toolbox industry. Some of these products may include CompX's KeSet
high  security  system,  which has the  ability to change the keying on a single
lock 64 times without removing the lock from its enclosure and its patented high
security TuBar locking system.

The Company  manufactures  disc tumbler  locking  mechanisms  at all of its
security  products  facilities,  which mechanisms  provide moderate security and
generally represent the lowest cost lock to produce. CompX also manufactures pin
tumbler locking  mechanisms,  including its KeSet, ACE II and TuBar brand locks,
which  mechanisms  are more  costly  to  produce  and are  used in  applications
requiring  higher  levels of security.  A  substantial  portion of the Company's
sales  consist  of  products   with   specialized   adaptations   to  individual
manufacturers'  specifications.  CompX, however, also has a standardized product
line  suitable for many  customers.  This  standardized  product line is offered
through a North American  distribution network through the Company's STOCK LOCKS
distribution program as well as to factory centers and to large OEMs.

Ergonomic  computer  support systems.  CompX is a leading  manufacturer and
innovator in ergonomic computer support systems and accessories.  Unlike similar
products targeting the residential  market,  which are more price sensitive with
less  emphasis on the  overall  value of products  and  service,  the CompX line
consists  of more  highly  engineered  products  designed  to provide  ergonomic
benefits for business and other sophisticated users.

Ergonomic computer support systems include  articulating  computer keyboard
support  arms  (designed  to attach to desks in the  workplace  and home  office
environments  to  alleviate  possible  strains  and stress and  maximize  usable
workspace),  CPU storage  devices (which  minimize  adverse  effects of dust and
moisture) and a number of complementary  accessories,  including ergonomic wrist
rest aids,  mouse pad supports and computer monitor support arms. These products
include  CompX's  Leverlock,  which is  designed  to make the  adjustment  of an
ergonomic  keyboard arm easier. In addition,  the Company offers its engineering
and  design  capabilities  for the  design  and  manufacture  of  products  on a
proprietary basis for key customers.

Other. CompX also manufactures, markets, and/or distributes a complete line
of  window  furnishings  hardware  in  European  markets  in  addition  to other
furniture products.

Sales, Marketing and Distribution

CompX  sells  components  to OEMs and to  distributors  through a dedicated
sales force.  The majority of the Company's sales are to OEMs, while the balance
represents standardized products sold through distribution channels.

Sales to large OEM customers are made through the efforts of  factory-based
sales and marketing  professionals  and engineers  working in concert with field
salespeople  and  independent  manufacturers'  representatives.   Manufacturers'
representatives  are  selected  based on special  skills in  certain  markets or
relationships with current or potential customers.

A significant portion of the Company's sales are made through distributors.
The  Company  has a  significant  market  share  of  cabinet  lock  sales to the
locksmith distribution channel. CompX supports its distributor sales with a line
of standardized products used by the largest segments of the marketplace.  These
products are packaged and  merchandised  for easy  availability  and handling by
distributors  and the end user.  Based on the Company's  successful  STOCK LOCKS
inventory program,  similar programs have been implemented for distributor sales
of  ergonomic  computer  support  systems and, to some  extent,  precision  ball
bearing  slides.  The  Company  also  operates  a  small  tractor/trailer  fleet
associated with its Canadian  facilities to provide an  industry-unique  service
response to major customers.

The Company does not believe it is dependent  upon one or a few  customers,
the loss of which would have a material  adverse  effect on its  operations.  In
2001, 2002 and 2003, sales to the Company's ten largest customers  accounted for
approximately 36%, 30% and 38% of sales,  respectively.  In 2001, 2002 and 2003,
sales to the  Company's  largest  customer  were less than 10% of the  Company's
total sales.  In 2001,  2002 and 2003,  eight of the Company's top ten customers
were located in the United States.

Manufacturing and Operations

At December 31, 2003, CompX operated eight manufacturing  facilities:  five
in North America (two in Illinois and one in each of Canada,  South Carolina and
Michigan),  one in the  Netherlands  and two in Taiwan.  Precision  ball bearing
slides are  manufactured in the facilities  located in Canada,  the Netherlands,
Michigan  and Taiwan.  Security  products  are  manufactured  in the  facilities
located in South Carolina and Illinois.  Ergonomic  products are manufactured in
the facility located in Canada.  The Company owns all of these facilities except
for one of the Taiwan facilities and the Netherlands facility, which are leased.
See also Item 2 -  "Properties."  CompX  also  leases a  distribution  center in
California and a warehouse in Taiwan.  CompX believes that all of its facilities
are well maintained and satisfactory for their intended purposes.

Raw Materials

Coiled steel is the major raw material used in the manufacture of precision
ball bearing slides and ergonomic  computer support systems.  Plastic resins for
injection molded plastics are also an integral  material for ergonomic  computer
support systems.  Purchased  components and zinc are the principal raw materials
used in the manufacture of security products.  These raw materials are purchased
from several suppliers and are readily available from numerous sources.

The Company occasionally enters into raw material  arrangements to mitigate
the short-term  impact of future  increases in raw material  costs.  While these
arrangements  do not commit the Company to a minimum  volume of purchases,  they
generally  provide for stated unit prices  based upon  achievement  of specified
volume  purchase  levels.  This allows the  Company to  stabilize  raw  material
purchase prices, provided that the specified minimum monthly purchase quantities
are met. Materials purchased outside of these arrangements are sometimes subject
to unanticipated and sudden price increases such as rapidly increasing worldwide
steel  prices in 2002 and 2003.  Due to the  competitive  nature of the  markets
served  by the  Company's  products,  it is  often  difficult  to  recover  such
increases  in raw material  costs  through  increased  product  selling  prices.
Consequently,  overall  operating  margins can be affected by such raw  material
cost pressures.

Competition

The markets in which CompX participates are highly competitive. The Company
competes  primarily  on the basis of product  design,  including  ergonomic  and
aesthetic  factors,  product quality and durability,  price,  on-time  delivery,
service and technical support. The Company focuses its efforts on the middle and
high-end segments of the market, where product design,  quality,  durability and
service are placed at a premium.

The Company  competes in the precision ball bearing slide market  primarily
on the basis of product  quality  and price with two large  manufacturers  and a
number of smaller  domestic and foreign  manufacturers.  The Company's  security
products  compete  with a variety  of  relatively  small  domestic  and  foreign
competitors.  The Company  competes in the ergonomic  computer  support  systems
market  primarily on the basis of product  quality,  features and price with one
major producer and a number of smaller domestic  manufacturers  and primarily on
the basis of price with a number of foreign manufacturers.  Although the Company
believes that it has been able to compete  successfully  in its markets to date,
price  competition from  foreign-sourced  product has intensified in the current
economic  market and there can be no assurance  that the Company will be able to
continue to successfully compete in all existing markets in the future.

Patents and Trademarks

The Company holds a number of patents  relating to its component  products,
certain  of which are  believed  to be  important  to CompX  and its  continuing
business  activity.  CompX's major trademarks and brand names,  including CompX,
CompX Security  Products,  CompX Waterloo,  National Cabinet Lock,  KeSet,  Fort
Lock,  Timberline Lock, Chicago Lock, ACE II, TuBar, Thomas Regout, STOCK LOCKS,
ShipFast,  Waterloo Furniture Components Limited and Dynaslide, are protected by
registration  in the United  States and  elsewhere  with respect to the products
CompX  manufactures  and sells.  The Company  believes such  trademarks are well
recognized in the component products industry.

Foreign Operations

The Company  has  substantial  operations  and assets  located  outside the
United States,  principally slide and/or ergonomic product operations in Canada,
the  Netherlands and Taiwan.  The majority of the Company's 2003 non-U.S.  sales
are to customers  located in Canada and Europe.  Foreign  operations are subject
to, among other  things,  currency  exchange  rate  fluctuations.  The Company's
results  of  operations  have in the past been both  favorably  and  unfavorably
affected by  fluctuations  in currency  exchange  rates.  Political and economic
uncertainties  in certain of the  countries  in which the Company  operates  may
expose the Company to risk of loss.  The Company  does not believe that there is
currently  any  likelihood  of  material  loss  through  political  or  economic
instability,  seizure,  nationalization  or similar  event.  The Company  cannot
predict,  however,  whether  events  of this  type in the  future  could  have a
material  effect on its operations.  See Item 7 -  "Management's  Discussion and
Analysis  of  Financial   Condition  and  Results  of  Operations,"  Item  7A  -
"Quantitative  and Qualitative  Disclosures About Market Risk" and Note 1 to the
Consolidated Financial Statements.

Environmental Matters

The Company's  operations are subject to federal,  state, local and foreign
laws  and  regulations  relating  to the  use,  storage,  handling,  generation,
transportation,  treatment, emission, discharge, disposal and remediation of and
exposure  to  hazardous  and  non-hazardous  substances,  materials  and  wastes
("Environmental  Laws").  The Company's  operations also are subject to federal,
state,  local and foreign  laws and  regulations  relating to worker  health and
safety. The Company believes that it is in substantial  compliance with all such
laws and  regulations.  The costs of maintaining  compliance  with such laws and
regulations have not significantly impacted the Company to date, and the Company
has no significant planned costs or expenses relating to such matters. There can
be no assurance,  however,  that  compliance with future  Environmental  Laws or
future laws and regulations  governing worker health and safety will not require
the Company to incur significant additional expenditures or that such additional
costs  would  not have a  material  adverse  effect on the  Company's  business,
consolidated financial condition, results of operations or liquidity.

Employees

As  of  December  31,  2003,  the  Company  employed   approximately  1,700
employees,  including  655 in the  United  States,  570  in  Canada,  300 in the
Netherlands and 175 in Taiwan.  Approximately 77% of the Company's  employees in
Canada are  represented  by a labor  union  covered by a  collective  bargaining
agreement which provides for annual wage increases from 1% to 2.5% over the life
of the contract.  Wage increases for these Canadian employees  historically have
also been in line with overall  inflation  indices.  The  collective  bargaining
agreement expires in January 2006. The Company believes that its labor relations
are satisfactory.

ITEM 2.   PROPERTIES

The  Company's  principal  executive  offices are located in  approximately
1,000 square feet of leased space at 5430 LBJ Freeway,  Dallas, Texas 75240. The
following table sets forth the location,  size,  business  operating segment and
general product types produced for each of the Company's facilities.

Size
Business                                      (square
Facility Name            Segment              Location                 feet)              Products Produced

Owned Facilities:
-----------------

Manitou                          CW      Kitchener, Ontario               276,000           Slides/ergonomic
products

Trillium                         CW      Kitchener, Ontario               110,000           N/A

Byron Center                     CW      Byron Center, MI                 143,000           Slides

National                        CSP      Mauldin, SC                      198,000           Security products

Fort                            CSP      River Grove, IL                  100,000           Security products

Timberline                      CSP      Lake Bluff, IL                    16,000           Security products

Dynaslide                        CW      Taipei, Taiwan                    48,000           Slides

Leased Facilities:
------------------
Thomas Regout                    TR      Maastricht,
the Netherlands                 270,000           Slides

Dynaslide                        CW      Taipei, Taiwan                    25,000           Slides

Dynaslide                        CW      Taipei, Taiwan                    11,000           Product distribution/
Warehouse

Distribution Center             CSP      Rancho Cucamonga, CA              12,000           Product distribution

CW  - CompX Waterloo business segment
TR  - Thomas Regout business segment
CSP - CompX Security Products business segment

The Manitou,  Thomas  Regout,  Byron Center,  National and Fort  facilities  are
ISO-9001 registered.  The Dynaslide-owned  facility is ISO-9002 registered.  The
Company  believes that all its facilities are well  maintained and  satisfactory
for their intended purposes. The Trillum facility is held for sale.

A sale/leaseback  transaction was executed on the Netherlands facility with
the municipality of Maastricht in December 2001. See Note 10 to the Consolidated
Financial Statements and see also Item 7 - "Management's Discussion and Analysis
of Financial Condition and Results of Operations."

ITEM 3.   LEGAL PROCEEDINGS

The  Company is  involved,  from time to time,  in  various  environmental,
contractual,  product  liability,  patent (or  intellectual  property) and other
claims  and  disputes   incidental  to  its  business.   Currently  no  material
environmental  or other  material  litigation is pending or, to the knowledge of
the Company,  threatened. The Company currently believes that the disposition of
all claims and disputes,  individually  or in the  aggregate,  should not have a
material  adverse  effect on the  Company's  consolidated  financial  condition,
results of operations or liquidity.

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

No matters were submitted to a vote of security  holders during the quarter
ended December 31, 2003.

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The  Company's  Class A common  stock is listed  and traded on the New York
Stock Exchange (symbol:  CIX). As of January 30, 2004, there were  approximately
26 holders of record of CompX Class A common  stock.  The  following  table sets
forth the high and low closing  sales  prices per share for CompX Class A common
stock for 2002 and 2003 and  dividends  paid per share during such  periods.  On
January 30, 2004 the closing  price per share of CompX Class A common  stock was
$7.53.

Dividends
High             Low              paid
--------         -------          ---------
Year ended December 31, 2002

First Quarter                                                     $14.00           $11.00               $.125
Second Quarter                                                     14.40            11.72                .125
Third Quarter                                                      14.00             8.78                .125
Fourth Quarter                                                      9.55             7.61                .125

Year ended December 31, 2003

First Quarter                                                     $ 8.38           $ 5.93               $.125
Second Quarter                                                      6.39             4.95                  - 
Third Quarter                                                       6.90             5.11                  - 
Fourth Quarter                                                      7.10             5.80                  - 

The Company  suspended  its regular  quarterly  dividend  during the second
quarter of 2003. The declaration and payment of future  dividends and the amount
thereof,  if any, will be dependent  upon the Company's  results of  operations,
financial   condition,   cash  requirements  for  its  businesses,   contractual
requirements  and restrictions and other factors deemed relevant by the Board of
Directors.

ITEM 6.   SELECTED FINANCIAL DATA

The following  selected  financial data should be read in conjunction  with
the  Company's  Consolidated  Financial  Statements  and Item 7 -  "Management's
Discussion and Analysis of Financial Condition and Results of Operations."

The Company's operations are comprised of a 52 or 53-week fiscal year. Each
of the years 1999  through  2003  consisted  of a 52-week  year.  2004 will be a
53-week year.

Years ended December 31,
-----------------------------------------
1999         2000         2001          2002          2003
----         ----         ----          ----          ----
($ in millions, except per share data)
Income Statement Data

Net sales                                            $225.9       $253.3       $211.4       $196.1        $207.5

Operating income                                     $ 40.0       $ 37.3       $ 12.5       $  6.2        $  4.1

Income before income taxes and
minority interest                                  $ 39.2       $ 35.5       $ 12.9       $  3.4        $  2.3
Income taxes                                           14.1         13.4          5.8          2.8           1.0
Minority interest in losses                             (.1)         -            -            -             -
------       ------       ------       ------        ----

Net income                                         $ 25.2       $ 22.1       $  7.1       $   .6        $  1.3
======       ======       ======       ======        ======

Net income per basic and
diluted share                                       $ 1.56       $ 1.37       $  .47       $  .04        $  .08
Cash dividends per share                             $ .125       $  .50       $  .50       $  .50        $ .125
Weighted average common shares
outstanding                                           16.1         16.1         15.1         15.1          15.1

Balance Sheet Data
(at year end):

Cash and other current assets                      $ 72.5       $ 83.0       $ 94.9       $ 71.3        $ 80.2
Total assets                                        200.4        223.7        222.9        200.1         209.5
Current liabilities                                  26.8         28.9         24.5         22.2          24.5
Long-term debt, including
current maturities                                  22.3         40.6         49.1         31.0          26.0
Stockholders' equity                                149.4        151.0        143.0        142.0         154.4

ITEM 7. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Executive Summary

The Company reported net income of $1.3 million, or $.08 per diluted share,
in 2003  compared to net income of $.6 million,  or $.04 per diluted  share,  in
2002 and $7.1  million,  or $.47  per  diluted  share,  in 2001.  As more  fully
described below, the Company's diluted earnings per share increased from 2002 to
2003 due  primarily  to the net effects of (i) lower  operating  income in 2003,
(ii) lower interest  expense in 2003 and (iii) a lower effective income tax rate
in 2003. The Company's  diluted  earnings per share  decreased from 2001 to 2002
due primarily to the net effects of (i) lower  operating  income in 2002, (ii) a
gain on the sale of a plant facility in 2001,  (iii) lower  interest  expense in
2002 and (iv) a higher effective income tax rate in 2002.

Fluctuations  in  currency  exchange  rates as  compared  to the prior year
positively  impacted sales by $8.9 million but negatively impacted cost of goods
sold by $10.9  million and operating  profit by $3.8 million.  The impact on net
sales is primarily due to the weakening U.S.  dollar in relation to the euro and
Canadian dollar.  The impact on operating income is primarily from the Company's
Canadian  operations,  where the majority of net sales are  denominated  in U.S.
dollars  while the majority of expenses  are  denominated  in Canadian  dollars.
Fluctuations in foreign currency exchange rates did not significantly affect the
Company's results in 2002 as compared to 2001.

CompX  is  continuing  its  focus  on  opportunities  to  improve  its cost
structure.

o    In the fourth quarter of 2002, the Company  retooled its Byron Center,
Michigan  precision  slide  facility  to  improve  the  efficiency  of
manufacturing  several product lines. The Company began to realize the
favorable  benefit of this  retooling in its operating  results in the
first  quarter of 2003,  and expects  the  improvement  will  continue
during 2004 resulting  from higher volumes and improved  manufacturing
efficiency.
o    In the first half of 2003, the Company  consolidated  its two Canadian
plants  into a single  facility.  The  Company  began to  realize  the
favorable  benefit of this  consolidation  and resulting  reduced cost
structure in its operating results in the fourth quarter of 2003.
o    During the third quarter of 2003,  CompX initiated a restructuring  of
its Regout  subsidiary  in Europe and incurred a $3.3 million  charge.
The Company  expects to begin  realizing the  favorable  benefits from
restructuring  actions in its operating  results by the second quarter
of 2004.

Cash  provided by operating  activities  improved to $24.4  million in 2003
from  $16.9  million  in 2002.  Working  capital  management  was a  significant
contributor to the improvement in cash flow. Specifically, the Company continues
to implement lean manufacturing initiatives which have reduced days in inventory
from 63 at the  beginning  of 2003 to 52 at the end of the year,  resulting in a
positive  cash flow from  inventory  of $5.1  million.  This  along  with  other
measures  have enabled the Company to pay down $5 million of debt in 2003 and an
additional $12 million in January 2004.

Critical Accounting Policies and Estimates

The  accompanying   "Management's  Discussion  and  Analysis  of  Financial
Condition and Results of Operations"  are based upon the Company's  consolidated
financial  statements,  which have been prepared in accordance  with  accounting
principles  generally  accepted in the United  States of America  ("GAAP").  The
preparation of these financial statements requires the Company to make estimates
and judgments  that affect the reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements, and the reported amount of revenues and expenses during the reported
period.  On an on-going basis,  the Company  evaluates its estimates,  including
those related to bad debts,  inventory  reserves,  the  recoverability  of other
long-lived  assets  (including  goodwill  and other  intangible  assets) and the
realization  of deferred  income tax assets.  The Company bases its estimates on
historical  experience and on various other  assumptions that are believed to be
reasonable  under the  circumstances,  the  results  of which form the basis for
making judgments about the reported amounts of assets, liabilities, revenues and
expenses.  Actual  results may differ from  previously-estimated  amounts  under
different assumptions or conditions.

The Company believes the critical financial statement judgment risks of its
business are attributable to four primary areas:

o    Will  customer  accounts  receivable on the books be collected at full
book value?
o    Will inventory on hand be sold with a sufficient  mark up to cover the
cost to produce and ship the product?
o    Will future cash flows of the Company be sufficient to recover the net
book value of long-lived assets?
o    Will future taxable income be sufficient to utilize recorded  deferred
income tax assets?

The Company believes the following critical  accounting policies affect its
more  significant  judgments  and  estimates,   as  noted  above,  used  in  the
preparation of its consolidated  financial  statements and are applicable to all
of the Company's operating segments:

o    Allowance for uncollectible accounts receivable. The Company maintains
allowances for doubtful  accounts for estimated  losses resulting from
the inability of its customers to make required payments.  The Company
takes  into  consideration  the  current  financial  condition  of the
customers,  the age of outstanding  balances and the current  economic
environment  when  assessing  the adequacy of the  allowances.  If the
financial  condition of the Company's  customers were to  deteriorate,
resulting  in  an  impairment  of  their  ability  to  make  payments,
increased allowances may be required.
o    Inventory  reserves.  The  Company  provides  reserves  for  estimated
obsolescence or unmarketable inventory equal to the difference between
the cost of inventory  and the estimated  net  realizable  value using
assumptions   about   future   demand  for  its  products  and  market
conditions.  The Company  also  considers  the age and the quantity of
inventory  on  hand  in  estimating  the  reserve.  If  actual  market
conditions  are less  favorable  than those  projected by  management,
increased inventory reserves may be required.
o    Net  book  value of  long-lived  assets.  The  Company  recognizes  an
impairment  charge  associated with its long-lived  assets,  including
property and equipment, goodwill and other intangible assets, whenever
it determines  that recovery of the long-lived  asset is not probable.
The   determination   is  made  in  accordance  with  applicable  GAAP
requirements  associated with the long-lived asset, and is based upon,
among other  things,  estimates of the amount of future net cash flows
to be generated by the  long-lived  asset and estimates of the current
fair value of the asset.  Adverse  changes in  estimates of future net
cash flows or  estimates of fair value could result in an inability to
recover the carrying value of the long-lived  asset,  thereby possibly
requiring an impairment charge to be recognized in the future.

Under   applicable  GAAP  (SFAS  No.  144,   Accounting  for  the
Impairment or Disposal of Long-Lived  Assets),  property and equipment
is not assessed for impairment unless certain  impairment  indicators,
as defined,  are present.  During  2003,  impairment  indicators  were
present  only  with  respect  to  the  Company's  Thomas  Regout  B.V.
operations.  The Company  completed an  impairment  review of such net
property  and  equipment  and related net assets as of  September  30,
2003.  Such  analysis  indicated  no  impairment  was  present  as the
estimated future  undiscounted cash flows associated with such segment
exceeded the carrying value of such segment's net assets.  Significant
judgment is required in estimating such  undiscounted cash flows. Such
estimated  cash flows are  inherently  uncertain,  and there can be no
assurance  that such  operations  will  achieve  the future cash flows
reflected in its projections.

Based  on  the  Company's  latest  annual  impairment  review  of
goodwill of the  reporting  units during the third quarter of 2003, no
goodwill  impairments were deemed to exist.  Based on this review, the
estimated fair value of the CompX Security  Products  segment exceeded
the net carrying  value by 110%,  CompX  Waterloo by 133%,  and Thomas
Regout  by  14%.  See  Notes  1 and 4 to  the  Consolidated  Financial
Statements.  The estimated fair value of these three  reporting  units
are determined based on discounted cash flow projections.  Significant
judgment is required in  estimating  such cash flows.  Such  estimated
cash flows are  inherently  uncertain,  and there can be no  assurance
that such  operations  will achieve the future cash flows reflected in
its  projections.  In addition to its internal cash flow  projections,
the Company used a third-party  valuation  specialist in reviewing the
net assets of its Thomas Regout B.V.  operations,  including  goodwill
and net property and equipment, for impairment.

o    Deferred income tax assets. The Company records a valuation  allowance
to  reduce  its  deferred  income  tax  assets to the  amount  that is
believed to be realizable under the "more-likely-than-not" recognition
criteria. The Company has considered future taxable income and ongoing
prudent and feasible tax planning strategies in assessing the need for
a valuation  allowance.  It is possible that in the future the Company
may  change its  estimate  of the  amount of the  deferred  income tax
assets  that  would  "more-likely-than-not"  be  realized.  This would
result in an  adjustment  to the deferred  income tax asset  valuation
allowance  that would  either  increase or  decrease,  as  applicable,
reported net income in the period the change in estimate is made.

Results of Operations

The  Company's   operating  segments  are  defined  as  components  of  its
operations  about which  separate  financial  information  is available  that is
regularly  evaluated by the chief operating decision maker in determining how to
allocate resources and in assessing performance. The Company has three operating
segments - CompX Security Products,  CompX Waterloo and Thomas Regout. The CompX
Security Products segment,  with manufacturing  facilities in South Carolina and
Illinois,  manufactures  locking mechanisms and other security products for sale
to the office furniture,  banking, vending,  computer and other industries.  The
CompX Waterloo segment, with facilities in Canada,  Michigan and Taiwan, and the
Thomas Regout segment, with facilities in the Netherlands,  both manufacture and
distribute a complete  line of precision  ball bearing  slides for use in office
furniture,   computer-related   equipment,   tool  storage  cabinets  and  other
applications.   Additionally,   the  CompX  Waterloo  segment  manufactures  and
distributes   ergonomic   computer   support   systems  for  office   furniture.
Historically,  the Company has  aggregated  the CompX Waterloo and Thomas Regout
operating  segments into a single reportable segment because of similar economic
characteristics,   products,   customer   types,   production   processes,   and
distribution  methods.  Due to the  continued  weakness in the  European  office
furniture  market  and  the  divergence  in  operating  income  between  the two
segments,  the Company  has  determined  that these two  segments no longer have
similar  economic  characteristics,   and  accordingly  the  Company  no  longer
aggregates the CompX Waterloo and Thomas Regout operating  segments.  Aggregated
segment amounts  reported for CompX  Waterloo/Thomas  Regout in previous periods
have been  reclassified  to conform to the  current  presentation.  Intersegment
sales are intercompany shipments from Thomas Regout to CompX Waterloo.

Net sales and operating income

Years ended December 31,                      % Change
--------------------------              ------------------------
2001         2002        2003        2001 - 2002         2002 - 2003
----         ----        ----        -----------         -----------
(In millions)

Net sales:

CompX Waterloo                        $105.1       $ 93.1      $ 97.5          -11%                  5%
CompX Security Products                 74.1         73.4        76.2           -1%                  4%
Thomas Regout                           33.3         31.2        35.3           -6%                 13%
Intersegment sales                      (1.1)        (1.6)       (1.5)          45%                 -6%
------       ------      ------

Total net sales                     $211.4       $196.1      $207.5           -7%                  6%
======       ======      ======

Operating income (loss):
CompX Waterloo                        $  8.6       $ (1.2)     $   .4         -114%                 n.m.
CompX Security Products                  7.3          8.1         9.7           10%                 21%
Thomas Regout                           (3.4)        (0.7)       (6.0)          80%                 n.m.
------       ------      ------
Total operating
income                             $ 12.5       $  6.2      $  4.1          -50%                -34%
======       ======      ======

Operating income (loss)
margin:
CompX Waterloo                           8%          -1%           0%
CompX Security Products                 10%          11%          13%
Thomas Regout                          -10%          -2%         -17%
Total operating income
margin                                  6%           3%           2%

n.m. - not meaningful

Year ended December 31, 2003 compared to year ended December 31, 2002

Currency.  CompX has substantial  operations and assets located outside the
United  States (in Canada,  the  Netherlands  and Taiwan).  A portion of CompX's
sales generated from its non-U.S. operations are denominated in currencies other
than the U.S.  dollar,  principally  the Canadian  dollar,  the euro and the New
Taiwan  dollar.  In  addition,  a portion of CompX's  sales  generated  from its
non-U.S.  operations (principally in Canada) are denominated in the U.S. dollar.
Most  raw  materials,  labor  and  other  production  costs  for  such  non-U.S.
operations are  denominated  primarily in local  currencies.  Consequently,  the
translated U.S. dollar values of CompX's foreign sales and operating results are
subject  to  currency  exchange  rate   fluctuations   which  may  favorably  or
unfavorably   impact  reported   earnings  and  may  affect   comparability   of
period-to-period  operating  results.  The effects of  fluctuations  in currency
exchange rates affect the CompX Waterloo and Thomas Regout segments,  and do not
materially  affect the CompX Security Products  segment.  During 2003,  currency
exchange  rate  fluctuations  of the  Canadian  dollar  and the euro  positively
impacted the Company's sales  comparisons with 2002 (principally with respect to
slide  products),   and  negatively  impacted  the  Company's  operating  income
comparisons.

Net sales were positively  impacted while  operating  income was negatively
impacted  by  currency  exchange  rates in the  following  amounts by segment as
compared to the currency exchange rates in effect during 2002:

CompX
CompX          Security         Thomas
Waterloo        Products         Regout           Total
--------        --------         ------           -----

Impact on net sales                                      $ 3,275          $  -            $5,600          $ 8,875
Impact on operating income                                (3,057)            -              (754)          (3,811)

Net Sales.  Net sales increased  $11.4 million,  or 6%, in 2003 compared to
2002  principally  due to the  strengthening  of the euro and Canadian dollar in
relation to the U.S. dollar,  combined with a strong fourth quarter for Security
Products.  In addition to the  favorable  impact of changes in foreign  currency
exchange  rates,  net sales  increased in 2003 as compared to 2002 due to higher
sales  volumes of  security  products,  and  precision  slide  products in North
America partially offset by lower sales volumes of ergonomic  products and lower
sales volumes of precision slide products in Europe.

Net sales of slide  products  in 2003  increased  10% as  compared to 2002,
while net sales of security  products  increased  4% and net sales of  ergonomic
products  decreased 6% during the same period.  The percentage  changes in slide
and ergonomic  products  includes the impact  resulting  from changes in foreign
currency exchange rates. Sales of security products are generally denominated in
U.S. dollars.

Costs of Goods Sold.  The Company's cost of goods sold increased 6% in 2003
compared to 2002 in line with the  increase in net sales during the same period.
Cost of  goods  sold as a  percent  of net  sales  was  even  with  2002 as cost
improvement initiatives,  such as improving facility efficiency, offset expenses
of approximately $900,000 to consolidate the two Kitchener,  Ontario plants into
a single facility during 2003, the negative impact of the aforementioned changes
in currency  exchange rates and increases in the cost of steel,  the primary raw
material for the Company's products.

Selling,   general  and  administrative  expense.   Selling,   general  and
administrative   expenses  consists  primarily  of  salaries,   commissions  and
advertising  expenses  directly related to product sales. As a percentage of net
sales, selling, general and administrative expense declined slightly from 14% of
net sales in 2002 to 13% in 2003.

2003  Restructuring  Charge.  Due  to  continued  operating  losses  at the
Company's  Thomas  Regout  subsidiary  in Europe  resulting  from the  continued
downturn in the  European  office  furniture  market,  the  Company  commenced a
strategic  analysis of the Thomas  Regout  segment  during the third  quarter of
2003.  As  part  of the  ongoing  analysis  of  these  operations,  the  Company
determined that it should  significantly  reduce  headcount in the operations in
order to be competitive.  Prior to the end of September,  the Company  finalized
and  communicated  to the employees a  restructuring  plan detailing the cost to
terminate   approximately  100  employees,   and  accordingly  the  Company  has
recognized  a  $3.3  million  restructuring  charge  related  to  the  headcount
reduction.  The $3.3 million  represents  severance to be paid to the terminated
employees, which is expected to be paid through the end of the second quarter of
2004. The Company expects the  restructuring to result in annual cost savings of
approximately  $3.5  million  to $4  million  which  is  expected  to  begin  to
positively impact financial results in the second quarter of 2004.

2002 Charges.  The Company  recorded a pre-tax charge in the fourth quarter
of 2002 of $1.6  million,  the  majority of which was  non-cash  in nature.  The
fourth  quarter 2002 charge  relates to a retooling of the  Company's  precision
slide  manufacturing  facility in Byron  Center,  Michigan  and  includes a $1.0
million  loss on disposal of  equipment,  reflected in other  general  corporate
income (expense), net in the consolidated statements of income. The remainder of
the charge is  reflected in cost of goods sold.  An  additional  fourth  quarter
pre-tax charge of approximately  $1.9 million was recorded to cost of goods sold
to adjust for  various  changes  in  estimates  with  respect  to  obsolete  and
slow-moving  inventory,  inventory  overhead  absorption  rates and other items.
Approximately  $1.3 million of this charge related to the CompX Waterloo segment
with the remaining $.6 million relating to the CompX Security Products segment.

Operating Income.  Operating income for 2003 decreased $2.1 million, or 34%
compared to 2002 and  operating  margins  decreased to 2% in 2003 compared to 3%
for 2002.  Continued  reductions  in  manufacturing,  fixed  overhead  and other
overhead  costs  combined  with the impact of the  fourth  quarter  2002  charge
partially offset the effects of the changes in currency exchange rates,  changes
in product mix, the cost of the European restructuring, and increases in certain
raw material costs (primarily steel).

Year ended December 31, 2002 compared to year ended December 31, 2001

Currency.  The effect of changes in  currency  exchange  rates from 2001 to
2002 was not material to sales or operating  income of the Company or any of its
segments.

Net Sales.  Net sales decreased  $15.3 million,  or 7%, in 2002 compared to
2001  principally  due to  continued  weak  demand for the  Company's  component
products sold to the office  furniture  market  resulting  from  continued  weak
economic conditions in the manufacturing sector in North America and Europe. Net
sales of slide  products in 2002  decreased  8% as  compared to 2001,  while net
sales of security  products  decreased  1% and net sales of  ergonomic  products
decreased 18% during the same period.

Cost of Goods Sold.  The Company's  cost of goods sold decreased only 3% in
2002  compared to 2001  despite  the 7%  decrease  in net sales  during the same
period. Therefore, the Company's gross margin percentage decreased significantly
from 21% in 2001 to 17% in 2002.  The  disproportionate  change in cost of goods
sold and its effect on gross margins was  primarily  due to lower  revenues from
sales of slide and  ergonomic  products  and the  resulting  impact of spreading
fixed  factory  costs over  lower  volume.  In  addition,  steel cost  increases
following the steel tariff imposed by the United States government increased the
Company's  raw  material  cost,  most of which was not  immediately  recoverable
through sales price  increases in 2002.  Such steel cost  increases  resulted in
additional  2002 raw  material  costs to CompX  of  approximately  $1.2  million
compared to 2001 steel raw material pricing. The CompX Waterloo segment was most
significantly  impacted  by the steel cost  increases,  while the effects on the
CompX Security Products segment were minimal.

Selling,   general  and  administrative  expense.   Selling,   general  and
administrative   expense  consists   primarily  of  salaries,   commissions  and
advertising  expenses  directly related to product sales. As a percentage of net
sales,  selling,  general and administrative  expense was 13% in 2001 and 14% in
2002.

2001 Charges.  In the fourth quarter of 2001,  the Company  incurred a $2.7
million  charge  for  headcount  reductions  of about 35  employees  in  CompX's
European operations  substantially all of which had been implemented by December
31,  2001.  Of the $2.7  million  charge,  as  adjusted  for changes in currency
exchange  rates,  approximately  $.4 million was paid in 2001,  $2.0 million was
paid  in  2002  and  $.6  million  was  paid  in  January   2003.  In  addition,
approximately  $3.0  million  in pre-tax  charges  were  recorded  in the fourth
quarter of 2001.  These  charges are  predominately  comprised  of $2.6  million
related to various  changes in  estimates  with respect to reserves for obsolete
and slow-moving  inventory,  approximately $.1 million related to allowances for
doubtful  accounts,  with the  remainder  related  to other  items.  Of the $3.0
million  charges,  approximately  $2.1  million  related  to the CompX  Security
Products segment,  $750,000 related to the CompX Waterloo segment,  and $150,000
related to the Thomas Regout segment.

Operating Income.  Operating income for 2002 decreased $6.3 million, or 50%
compared to 2001 and  operating  margins  decreased to 3% in 2002 compared to 6%
for 2001.  Continued  reductions  in  manufacturing,  fixed  overhead  and other
overhead costs partially  offset the effects of the decline in net sales in 2002
and the impact of the fourth quarter 2002 charge previously discussed.  However,
operating  margins in 2002 continued to be adversely  impacted by the decline in
volume levels,  unfavorable  changes in the sales mix,  increases in certain raw
material costs (primarily steel) and general competitive pricing pressures.

Through  December 31, 2001,  goodwill  was  amortized by the  straight-line
method over not more than 20 years.  Upon  adoption of  Statement  of  Financial
Accounting  Standards  ("SFAS") No. 142,  Goodwill and Other Intangible  Assets,
effective   January  1,  2002,   goodwill  is  no  longer  subject  to  periodic
amortization.  The Company would have reported operating income of approximately
$14.7  million in 2001 if the goodwill  amortization  included in the  Company's
reported operating income had not been recognized.

General

The Company's profitability primarily depends on its ability to utilize its
production capacity  effectively,  which is affected by, among other things, the
demand for its  products  and its  ability to control its  manufacturing  costs,
primarily  comprised  of labor  costs and raw  materials  such as zinc,  copper,
coiled steel and plastic resins. Raw material costs represent  approximately 48%
of the  Company's  total cost of sales.  During 2002 and 2003,  worldwide  steel
prices  increased  following  the steel  tariff  imposed  by the  United  States
government.   The  Company   occasionally   enters  into  raw  material   supply
arrangements  to  mitigate  the  short-term  impact of future  increases  in raw
material costs.  While these arrangements do not commit the Company to a minimum
volume of purchases,  they  generally  provide for stated unit prices based upon
achievement  of specified  volume  purchase  levels.  This allows the Company to
stabilize  raw  material  purchase  prices to a  certain  extent,  provided  the
specified  minimum monthly purchase  quantities are met. The Company enters into
such  arrangements  for zinc,  coiled steel and plastic  resins and  anticipates
further  significant  changes in the cost of these  materials,  primarily coiled
steel, from their current levels for the next year.  Materials  purchased on the
spot market are sometimes  subject to unanticipated  and sudden price increases.
Due to the competitive  nature of the markets served by the Company's  products,
it is often  difficult to recover such  increases in raw material  costs through
increased product selling prices. Consequently, overall operating margins may be
affected by such raw material cost pressures.

Other general corporate income (expense), net

As summarized in Note 11 to the Consolidated  Financial Statements,  "other
general  corporate income  (expense),  net" primarily  includes interest income,
losses  on  disposal  of  property  and  equipment  and  net  foreign   currency
transaction  gain and loss. In 2002,  loss on disposal of property and equipment
included  approximately  $1.0 million  related to the retooling of the Company's
precision slide manufacturing facility in Byron Center,  Michigan. The remainder
of the pre-tax  charge,  $.6  million,  is  reflected  in cost of goods sold and
related to the cost of moving and installing  machinery and equipment as well as
the disposal of obsolete  inventory.  Interest income decreased in 2002 compared
to 2001 due  primarily to lower  interest  rates earned on funds  available  for
investment  combined with a lower level of funds  available for  investment.  In
2001,  a  curtailment  gain of  approximately  $.1 million was included in other
general  corporate  income,  net. This curtailment gain, more fully described in
Note 7 to the  Consolidated  Financial  Statements,  relates to the cessation of
benefits provided under CompX's defined benefit plan which covered substantially
all full-time  employees of Thomas Regout  International B.V. As of December 31,
2001, certain  obligations related to the terminated plan had not yet been fully
settled and are reflected in accrued pension costs.  In 2002,  such  obligations
were settled and the Company reported a $.7 million settlement gain.

Interest expense

Interest  expense  declined  $.6  million  in 2003  compared  to  2002  due
primarily to lower average levels of borrowing on CompX's  revolving bank credit
facility,  partially offset by higher interest rates.  Interest expense declined
$1.0 million in 2002  compared to 2001 due to lower average  interest  rates and
lower levels of outstanding  indebtedness.  Interest expense in 2004 is expected
to  be  lower  compared  to  2003  due  to  the  reduction  in  the  outstanding
indebtedness.

Provision for income taxes

The principal  reasons for the difference  between CompX's effective income
tax rates and the U.S. federal  statutory income tax rates are explained in Note
8  to  the  Consolidated   Financial  Statements.   Income  tax  rates  vary  by
jurisdiction  (country and/or state), and relative changes in the geographic mix
of CompX's pre-tax  earnings can result in fluctuations in the effective  income
tax rate.  Net income in 2002 was  negatively  impacted  by an  increase  in the
effective  income tax rate  primarily as a result of lower income  levels and an
increased  proportion  of  foreign-sourced  dividend  income  taxed  at a higher
effective tax rate.

As discussed in Note 1 to the Consolidated Financial Statements,  effective
January 1, 2002,  the  Company no longer  recognizes  periodic  amortization  of
goodwill.  Under GAAP,  generally there is no income tax benefit  recognized for
financial reporting purposes attributable to goodwill amortization. Accordingly,
ceasing to  periodically  amortize  goodwill  beginning  in 2002  resulted  in a
reduction in the Company's overall effective income tax rate in 2002 as compared
to  2001,   partially   offsetting   the   increased   effective   tax  rate  on
foreign-sourced income.

Other

Reflected in the 2001 results of  operations  is a $2.2 million gain on the
sale/leaseback of the Company's manufacturing facility in the Netherlands, which
is  discussed  more  fully  below and in Note 10 to the  Consolidated  Financial
Statements.

Related party transactions

CompX is a party to certain  transactions with related parties. See Note 12
to the Consolidated Financial Statements.

Outlook

The Company expects that weak market conditions will continue in the office
furniture  market,  the primary  end-market for the Company's  products,  during
2004. While the Business and Institutional Furniture Manufacturer's  Association
(BIFMA) International has predicted a 6% growth in furniture shipments for 2004,
the total  volume of  shipments  is expected to be 33% below the highest  annual
volume set in 2000. If the  prediction is correct,  2004 would be the first year
of office furniture  industry growth since 2000.  However,  competitive  pricing
pressures  are expected to continue to be a challenge as foreign  manufacturing,
particularly in China,  gains market share.  The Company expects steel prices to
continue  to rise in 2004 as much  as 20% to  30%,  or  more.  The  Company  has
initiated  price increases on certain of its products and will continue to focus
on cost improvement  initiatives,  utilizing lean  manufacturing  techniques and
prudent balance sheet  management in order to minimize the impact of lower sales
to  the  office  furniture   industry  and  to  develop   value-added   customer
relationships  with  additional  focus on sales of the  Company's  higher-margin
ergonomic  computer support systems to improve  operating  results.  The Company
currently  expects to realize  annual cost  savings of $3.5 to $4 million as the
result of the current Thomas Regout headcount  reduction.  However,  the Company
continues with its ongoing strategic analysis of the operations,  and additional
actions  could be taken in the  future  that could  result in charges  for asset
impairment,  including  goodwill,  and  other  costs in  future  periods.  These
actions,  along with other activities to eliminate excess capacity, are designed
to position the Company to more effectively  concentrate on both new product and
new customer opportunities to improve Company profitability.

Liquidity and Capital Resources

Summary.

The Company's  primary  source of liquidity on an ongoing basis is its cash
flow from  operating  activities,  which is  generally  used to (i) fund capital
expenditures,  (ii) repay short-term indebtedness incurred primarily for working
capital  purposes and (iii) provide for the payment of dividends (if  declared).
From time-to-time, the Company will incur indebtedness, primarily for short-term
working capital needs or to fund capital  expenditures.  From time-to-time,  the
Company  may also sell assets  outside  the  ordinary  course of  business,  the
proceeds  of  which  are  generally  used  to  repay   indebtedness   (including
indebtedness  which may have been  collateralized by the assets sold) or to fund
capital expenditures.

At December 31, 2003,  the Company's  indebtedness  aggregated $26 million,
all of which matures in January 2006.  In January 2004,  the Company  repaid $12
million  of such  indebtedness,  using  available  funds  on hand.  Because  the
maturity date of the indebtedness  isn't until 2006, the Company does not expect
it will be  required  to use any of its  cash  flow  from  operating  activities
generated during 2004 to repay indebtedness, although it may chose to do so.

Cash  provided by operating  activities  improved to $24.4  million in 2003
from  $16.9  million  in 2002.  Working  capital  management  was a  significant
contributor to the improvement in cash flow. Specifically, the Company continues
to implement lean manufacturing initiatives which have reduced days in inventory
from 63 at the  beginning  of 2003 to 52 at the end of the year,  resulting in a
positive  cash flow from  inventory  of $5.1  million.  This  along  with  other
measures  have enabled the Company to pay down $5 million of debt in 2003 and an
additional $12 million in January 2004.

Consolidated cash flows

Operating  activities.  Trends in cash  flows  from  operating  activities,
excluding  changes  in assets  and  liabilities,  for  2001,  2002 and 2003 have
generally been similar to the trend in the Company's earnings.  Depreciation and
amortization  expense  increased  in 2003  compared to 2002 due to an  increased
amount of assets  put into  service  over the past year and a half  relating  to
specific  customer  volume  combined  with the  impact of  changes  in  currency
exchange  rates but  decreased  in 2002  compared to 2001 due  primarily  to the
cessation of amortization of goodwill. See Notes 1 and 4.

Changes  in assets  and  liabilities  result  primarily  from the timing of
production,  sales  and  purchases.  Such  changes  in  assets  and  liabilities
generally tend to even out over time. However,  year-to-year relative changes in
assets and liabilities can significantly  affect the comparability of cash flows
from operating activities. In 2001, accounts receivable, inventory, and accounts
payable all declined as a result of the decline in sales  volume.  In 2002,  the
declines in accounts receivable and accounts payable are again the result of the
lower sales volumes,  but the inventory  decrease is relatively more significant
as the Company  began to realize  some of the benefit of its lean  manufacturing
initiatives. For 2003, the increase in sales volumes resulted in higher accounts
receivable and accounts payable balances while the Company continued to actively
reduce inventory levels.

Investing  activities.  Net cash used by investing  activities totaled $2.7
million,  $12.7 million, and $8.2 million for the years ended December 31, 2001,
2002 and 2003,  respectively.  In 2001,  $10.0 million in cash was provided from
the  sale/leaseback  of the Company's plant facility in the  Netherlands.  Other
cash flows from  investing  activities  in each of the past three years  related
principally  to capital  expenditures.  Capital  expenditures  in the past three
years  emphasized  manufacturing  equipment which utilizes new  technologies and
increases  automation  of the  manufacturing  process to provide  for  increased
productivity  and efficiency.  Capital  expenditures in 2001 through 2003 relate
primarily to general equipment upgrades,  modernization,  and capacity increases
relating to specific customer volume.

Pursuant  to  the   sale/leaseback  of  the  Company's  plant  facility  in
Maastricht,  the Netherlands,  CompX sold the  manufacturing  facility for $10.0
million cash  consideration in December 2001, and CompX  simultaneously  entered
into a leaseback of the facility  with a nominal  monthly  rental for between 36
and 48  months  depending  on when the  alternative  location  has  cleared  all
regulatory  hurdles.  See  Note  10 to the  Consolidated  Financial  Statements.
Pursuant to the  agreement,  CompX is also  obligated  to acquire up to 10 acres
from the municipality for approximately $2.5 million within the next four years.
Acquisition  at this  property is subject to the  municipality  meeting  certain
conditions which have not yet been met.

Capital  expenditures for 2004 are estimated at approximately  $11 million,
the  majority of which relate to projects  that  emphasize  improved  production
efficiency.  Firm  purchase  commitments  for  capital  projects  in  process at
December 31, 2003 approximated $.6 million.

Financing  activities.  Net cash used by financing  activities totaled $1.8
million,  $25.5 million, and $7.3 million in 2001, 2002 and 2003,  respectively.
Total cash  dividends  paid in each of 2001 and 2002 were $7.6 million ($.50 per
share) and in 2003 was $1.9 million ($.125 per share). The Company suspended its
regular quarterly dividend in the second quarter of 2003. The Company borrowed a
net $8.4 million under its revolving bank credit  facility in 2001, and repaid a
net $18.1  million and $5.0 million  under such  facility  during 2002 and 2003,
respectively.  In  addition,  in January  2004 the Company  further  reduced the
outstanding balance under the revolving bank credit facility by $12 million.

The  Company's  $47.5 million  secured  revolving  bank credit  facility is
collateralized by substantially all of the Company's United States assets and at
least 65% of the  ownership  interests in the  Company's  first-tier  non-United
States subsidiaries. Provisions contained in the Revolving Bank Credit Agreement
could  result  in the  acceleration  of the  indebtedness  prior  to its  stated
maturity  for reasons  other than  defaults  from failing to comply with typical
financial  covenants.  For example,  the Company's  Credit  Agreement allows the
lender to accelerate the maturity of the  indebtedness  upon a change of control
(as defined) of the borrower.  The terms of the Credit Agreement could result in
the  acceleration  of all or a portion of the  indebtedness  following a sale of
assets  outside  of  the  ordinary  course  of  business.  See  Note  6  to  the
Consolidated Financial Statements. Other than certain operating leases discussed
in Note 13 to the Consolidated  Financial  Statements,  neither CompX nor any of
its  subsidiaries or affiliates are parties to any  off-balance  sheet financing
arrangements.

Other

Management  believes  that cash  generated  from  operations  and borrowing
availability  under the Credit  Agreement,  together with cash on hand,  will be
sufficient to meet the Company's  liquidity needs for working  capital,  capital
expenditures and debt service. To the extent that the Company's actual operating
results or other developments  differ from the Company's  expectations,  CompX's
liquidity could be adversely affected.

The Company periodically evaluates its liquidity requirements,  alternative
uses of capital,  capital needs and available  resources in view of, among other
things,  its capital  expenditure  requirements,  dividend  policy and estimated
future operating cash flows. As a result of this process, the Company has in the
past  and may in the  future  seek to raise  additional  capital,  refinance  or
restructure indebtedness, issue additional securities,  repurchase shares of its
common stock,  modify its dividend policy or take a combination of such steps to
manage its  liquidity and capital  resources.  In the normal course of business,
the Company may review  opportunities for acquisitions,  joint ventures or other
business  combinations in the component products  industry.  In the event of any
such  transaction,  the Company  may  consider  using  available  cash,  issuing
additional  equity  securities or increasing the  indebtedness of the Company or
its subsidiaries.

Contractual  obligations.  As more  fully  described  in the  notes  to the
Consolidated  Financial  Statements,  the  Company is  obligated  to make future
payments  under  certain  debt  and  lease  agreements,  and is a party to other
commitments. The following table summarizes these obligations as of December 31,
2003.

Payments due by period
-----------------------------------
Less than       1 - 3        4 - 5
Total        1 year        years        years
---------    ----------      -----        -----
(In thousands)

Long-term debt                                                 $26,000       $  -         $26,000      $  -
Capital lease obligations and other                               -             -            -            -
Operating leases                                                 2,072           851        1,049          172
Purchase obligations                                            11,763        11,435          328         -
Fixed asset acquisitions                                         3,070           570         -           2,500
-------       -------      -------      -------

Total contractual cash obligations                             $42,905       $12,856      $27,377      $ 2,672
=======       =======      =======      =======

The  purchase   obligations   consist  of  all  open  purchase  orders  and
contractual obligations,  primarily commitments to purchase raw materials. Fixed
asset  acquisitions  include firm purchase  commitments for capital projects and
the  obligation to purchase up to 10 acres from the  municipality  of Maastricht
within the next four years.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

General.  The  Company is exposed  to market  risk from  changes in foreign
currency  exchange  rates and  interest  rates.  The Company  periodically  uses
currency  forward  contracts to manage a portion of foreign  exchange  rate risk
associated  with  receivables,  or similar  exchange rate risk  associated  with
future  sales,  denominated  in a currency  other than the  holder's  functional
currency. Otherwise, the Company does not generally enter into forward or option
contracts to manage such market risks,  nor does the Company enter into any such
contract  or other type of  derivative  instrument  for  trading or  speculative
purposes.  Other than the contracts discussed below, the Company was not a party
to any forward or derivative  option contract  related to foreign exchange rates
or interest rates at December 31, 2002 and 2003. See Note 1 to the  Consolidated
Financial Statements.

Interest  rates.  The  Company is exposed  to market  risk from  changes in
interest rates, primarily related to indebtedness.

At  December  31,  2002  and  2003,  substantially  all  of  the  Company's
outstanding  indebtedness  were variable  rate  borrowings.  Such  borrowings at
December  31, 2003 related  principally  to $26 million ($31 million at December
31,  2002) in  borrowings  under the  Company's  secured  Revolving  Bank Credit
Agreement.  The  outstanding  balances  at  December  31,  2002 and 2003  (which
approximate fair value) had a  weighted-average  interest rate of 2.5% and 3.2%,
respectively.  Amounts  outstanding under the credit facility are due in January
2006.  The remaining  indebtedness  outstanding at December 31, 2002 and 2003 is
not material.

Foreign  currency  exchange  rates.  The  Company is exposed to market risk
arising  from  changes  in  foreign  currency  exchange  rates  as a  result  of
manufacturing  and selling its products  outside the United States  (principally
Canada,  Western Europe and Taiwan).  A portion of CompX's sales  generated from
its  non-U.S.  operations  are  denominated  in  currencies  other than the U.S.
dollar,  principally the Canadian dollar, the euro and the New Taiwan dollar. In
addition,  a portion of CompX's  sales  generated  from its non-U.S.  operations
(principally in Canada) are denominated in the U.S. dollar.  Most raw materials,
labor and other  production  costs for such non-U.S.  operations are denominated
primarily in local currencies. Consequently, the translated U.S. dollar value of
CompX's  foreign  sales and operating  results are subject to currency  exchange
rate  fluctuations  which may favorably or unfavorably  impact reported earnings
and may affect comparability of period-to-period operating results.

Certain  of  CompX's  sales  generated  by  its  Canadian   operations  are
denominated in U.S.  dollars.  To manage a portion of the foreign  exchange rate
market  risk  associated  with  receivables,   or  similar  exchange  rate  risk
associated  with  future  sales,  at  December  31,  2003 CompX held a series of
short-term forward exchange contracts maturing through February 2004 to exchange
an  aggregate of $4.2 million for an  equivalent  amount of Canadian  dollars at
exchange rates of Cdn. $1.30 to Cdn. 1.33 per U.S. dollar. At each balance sheet
date,  outstanding  currency  forward  contracts are  marked-to-market  with any
resulting gain or loss recognized in income  currently.  The difference  between
the  estimated  fair  value and the face value of all such  outstanding  forward
contracts at December 31, 2003 is not material. At December 31, 2003, the actual
exchange  rate was Cdn.  $1.31 per U.S.  dollar.  At December 31, 2002 CompX had
entered into a series of short-term  forward exchange contracts maturing through
January 2003 to exchange an aggregate of $2.5 million for an  equivalent  amount
of Canadian dollars at an exchange rate of Cdn. $1.57 per U.S. dollar.

Other. The above discussion includes  forward-looking  statements of market
risk which assume  hypothetical  changes in market prices.  Actual future market
conditions  will likely differ  materially from such  assumptions.  Accordingly,
such  forward-looking  statements  should not be considered to be projections by
the Company of future  events or losses.  Such  forward-looking  statements  are
subject  to  certain  risks  and  uncertainties  some of  which  are  listed  in
"Business-General."

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information  called for by this Item is contained in a separate section
of this Annual Report.  See "Index of Financial  Statements and Schedule"  (page
F-1).

ITEM  9.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

The Company maintains a system of disclosure  controls and procedures.  The
term  "disclosure  controls and  procedures,"  as defined by  regulations of the
Securities  and  Exchange  Commission  (the  "SEC"),  means  controls  and other
procedures that are designed to ensure that information required to be disclosed
in the reports that the Company files or submits to the SEC under the Securities
Exchange Act of 1934, as amended (the "Act"), is recorded, processed, summarized
and  reported,  within the time periods  specified in the SEC's rules and forms.
Disclosure  controls and procedures include,  without  limitation,  controls and
procedures  designed to ensure that information  required to be disclosed by the
Company  in the  reports  that it files or  submits  to the SEC under the Act is
accumulated  and  communicated  to  the  Company's  management,   including  its
principal  executive  officer and its principal  financial  officer,  or persons
performing  similar  functions,  as appropriate to allow timely  decisions to be
made regarding required disclosure.  Each of David A. Bowers, the Company's Vice
Chairman of the Board,  President  and Chief  Executive  Officer,  and Darryl R.
Halbert,  the Company's Vice President,  Chief Financial Officer and Controller,
have evaluated the Company's  disclosure  controls and procedures as of December
31, 2003. Based upon their evaluation,  these executive  officers have concluded
that the Company's  disclosure  controls and  procedures are effective as of the
date of such evaluation.

The Company also  maintains a system of internal  controls  over  financial
reporting.  The term "internal control over financial  reporting," as defined by
regulations  of the SEC, means a process  designed by, or under the  supervision
of, the  Company's  principal  executive and principal  financial  officers,  or
persons  performing  similar  functions,  and effected by the Company's board of
directors,  management  and other  personnel,  to provide  reasonable  assurance
regarding  the  reliability  of  financial  reporting  and  the  preparation  of
financial  statements  for  external  purposes  in  accordance  with  accounting
principles  generally  accepted in the United  States of America  ("GAAP"),  and
includes those policies and procedures that:

o    Pertain  to the  maintenance  of  records  that in  reasonable  detail
accurately and fairly reflect the transactions and dispositions of the
assets of the Company.
o    Provide  reasonable   assurance  that  transactions  are  recorded  as
necessary to permit preparation of financial  statements in accordance
with GAAP, and that receipts and expenditures of the Company are being
made  only  in  accordance  with   authorizations  of  management  and
directors of the Company, and
o    Provide reasonable  assurance regarding prevention or timely detection
of  unauthorized  acquisition,  use or  disposition  of the  Company's
assets that could have a material effect on the Company's consolidated
financial statements.

There has been no change to the  Company's  system  of  internal  controls  over
financial  reporting  during  the  quarter  ended  December  31,  2003  that has
materially affected, or is reasonably likely to materially affect, the Company's
system of internal controls over financial reporting.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The  information  required by this Item is  incorporated  by  reference  to
CompX's  definitive Proxy Statement to be filed with the Securities and Exchange
Commission  pursuant  to  Regulation  14A  within  120 days after the end of the
fiscal year covered by this report (the "CompX Proxy Statement").

ITEM 11. EXECUTIVE COMPENSATION

The  information  required by this Item is incorporated by reference to the
CompX Proxy Statement.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The  information  required by this Item is incorporated by reference to the
CompX Proxy Statement.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The  information  required by this Item is incorporated by reference to the
CompX  Proxy  Statement.   See  also  Note  12  to  the  Consolidated  Financial
Statements.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

The  information  required by this Item is incorporated by reference to the
CompX Proxy Statement.

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)  and (d) Financial Statements and Schedule

The Registrant

The  consolidated  financial  statements  and schedules  listed on the
accompanying  Index of Financial  Statements  and Schedules  (see page
F-1) are filed as part of this Annual Report.

(b)  Reports on Form 8-K

Reports on Form 8-K for the quarter ended  December 31, 2003:  
October 30, 2003 - Reported items 9 and 12.

(c)  Exhibits

Included as exhibits are the items listed in the Exhibit Index.  CompX
will furnish a copy of any of the  exhibits  listed below upon payment
of $4.00 per  exhibit  to cover the costs to CompX of  furnishing  the
exhibits. Instruments defining the rights of holders of long-term debt
issues  which do not exceed 10% of  consolidated  total assets will be
furnished to the  Commission  upon  request.  CompX will also furnish,
without charge, a copy of its Code of Business Conduct and Ethics,  as
adopted by the Board of Directors on February 24, 2004,  upon request.
Such requests should be directed to the attention of CompX's Corporate
Secretary at CompX's  corporate  offices  located at 5430 LBJ Freeway,
Suite 1700, Dallas, Texas 75240.

Item No.      Exhibit Item
--------      ------------

3.1            Restated   Certificate   of   Incorporation   of   Registrant   -
incorporated  by  reference  to Exhibit  3.1 of the  Registrant's
Registration Statement on Form S-1 (File No. 333-42643).

3.2            Amended and Restated  Bylaws of Registrant,  adopted by the Board
of  Directors  August 31, 2002 -  incorporated  by  reference  to
Exhibit 3.2 of the  Registrant's  Annual  Report on Form 10-K for
the year ended December 31, 2002.

10.1           Intercorporate  Services  Agreement  between the  Registrant  and
Contran   Corporation   effective   as  of   January  1,  2003  -
incorporated  by reference  to Exhibit  10.1 of the  Registrant's
Quarterly  Report on Form  10-Q for the  quarter  ended  June 30,
2003.

10.2           Intercorporate  Services  Agreement  between the  Registrant  and
Contran Corporation effective as of January 1, 2004.

10.3*          CompX   International  Inc.  1997  Long-Term   Incentive  Plan  -
incorporated  by reference  to Exhibit  10.2 of the  Registrant's
Registration Statement on Form S-1 (File No. 333-42643).

10.4*          CompX International Inc. Variable  Compensation Plan effective as
of January 1, 1999 - incorporated by reference to Exhibit 10.4 of
the  Registrant's  Annual  Report on Form 10-K for the year ended
December 31, 1998.

10.5           Agreement   between   Haworth,   Inc.  and   Waterloo   Furniture
Components,   Ltd.  and  Waterloo  Furniture   Components,   Inc.
effective  October 1, 1992 - incorporated by reference to Exhibit
10.3 of the Registrant's Registration Statement on Form S-1 (File
No. 333-42643).

Item No.      Exhibit Item
--------      ------------

10.6           Tax Sharing  Agreement  among the  Registrant,  Valcor,  Inc. and
Valhi,  Inc.  dated  as of  January  2,  1998 -  incorporated  by
reference  to  Exhibit  10.4  of  the  Registrant's  Registration
Statement on Form S-1 (File No. 333-42643).

10.7           $47,500,000  Credit  Agreement  between the Registrant,  Wachovia
Bank,  National   Association,   as  Agent  and  various  lending
institutions  dated January 22, 2003 - incorporated  by reference
to Exhibit 10.9 of the  Registrant's  Annual  Report on Form 10-K
for the year ended December 31, 2002.

10.8           First Amendment to Credit Agreement between Registrant,  Wachovia
Bank,  and  National  Association,  as Agent and various  lending
institutions  dated October 20, 2003 - incorporated  by reference
to Exhibit 10.1 at the Registrant's Quarterly Report on Form 10-Q
for the quarter ended September 30, 2003.

10.9           Asset    sale/leaseback    agreement    between   Thomas   Regout
International  BV  and  the   municipality  of  Maastricht,   the
Netherlands  dated  December 21, 2001 (English  translation  from
Dutch language  document) - incorporated  by reference to Exhibit
10.12 of the Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001.

10.10*         Agreement and General Release between the Registrant and Brent A.
Hagenbuch,  effective May 22, 2002 - incorporated by reference to
Exhibit 10.12 of the  Registrant's  Annual Form 10-K for the year
ended December 31, 2002.

10.11*         Agreement and General  Release  between the Registrant and Stuart
M. Bitting,  effective July 31, 2002 - incorporated  by reference
to Exhibit  10.12 of the  Registrant's  Annual  Form 10-K for the
year ended December 31, 2002.

10.12          Agreement  Regarding  Shared  Insurance  between the  Registrant,
Contran  Corporation,  Keystone  Consolidated  Industries,  Inc.,
Kronos  Worldwide,  Inc., NL Industries,  Inc.,  Titanium  Metals
Corp., and Valhi, Inc. dated October 30, 2003.

21.1           Subsidiaries of the Registrant.

23.1           Consent of PricewaterhouseCoopers LLP.

31.1           Certification

31.2           Certification

32.1           Certification

32.2           Certification

99.1           Annual  Report of the CompX  Contributory  Retirement  Plan (Form
11-K) to be filed under Form 10-K to this  Annual  Report on Form
10-K within 180 days after December 31, 2003.

* Management contract, compensatory plan or agreement.

SIGNATURES

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.

COMPX INTERNATIONAL INC.

By:      /s/ David A. Bowers                         
------------------------------------------------
David A. Bowers
Vice Chairman of the Board,
President and Chief Executive Officer
(Principal Executive Officer)

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

Signature                          Title                  Date

/s/ Glenn R. Simmons              Chairman of the Board           March 3, 2004
-----------------------------
Glenn R. Simmons

/s/ David A. Bowers               Vice Chairman of the Board,     March 3, 2004
-----------------------------     President and Chief Executive
David A. Bowers                   Officer (Principal Executive
Officer)

/s/ Darryl R. Halbert             Vice President,                 March 3, 2004
-----------------------------     Chief Financial Officer
Darryl R. Halbert                 and Controller
(Principal Financial and
Accounting Officer)

/s/ Paul M. Bass, Jr.             Director                        March 3, 2004
-----------------------------
Paul M. Bass, Jr.

/s/ Keith R. Coogan               Director                        March 3, 2004
-----------------------------
Keith R. Coogan

/s/ Edward J. Hardin              Director                        March 3, 2004
-----------------------------
Edward J. Hardin

/s/ Ann Manix                     Director                        March 3, 2004
-----------------------------
Ann Manix

/s/ Steven L. Watson              Director                        March 3, 2004
-----------------------------
Steven L. Watson

Annual Report on Form 10-K

Items 8, 14(a) and 14(d)

Index of Financial Statements and Schedule

Financial Statements                                                 Page No.
--------

Report of Independent Auditors                                       F-2

Consolidated Balance Sheets - December 31, 2002 and 2003             F-3

Consolidated Statements of Income -
Years ended December 31, 2001, 2002 and 2003                        F-5

Consolidated Statements of Comprehensive Income -
Years ended December 31, 2001, 2002 and 2003                        F-6

Consolidated Statements of Cash Flows -
Years ended December 31, 2001, 2002 and 2003                        F-7

Consolidated Statements of Stockholders' Equity -
Years ended December 31, 2001, 2002 and 2003                        F-9

Notes to Consolidated Financial Statements                           F-10

Financial Statement Schedule

Report of Independent Auditors                                       S-1

Schedule II - Valuation and Qualifying Accounts                      S-2

Schedules I, III and IV are omitted because they are not applicable.

F-1

REPORT OF INDEPENDENT AUDITORS

To the Stockholders and Board of Directors of CompX International Inc.:

In our  opinion,  the  accompanying  consolidated  balance  sheets  and the
related consolidated statements of income,  comprehensive income, cash flows and
stockholders' equity present fairly, in all material respects,  the consolidated
financial  position of CompX  International Inc. and Subsidiaries as of December
31, 2002 and 2003, and the  consolidated  results of their  operations and their
cash flows for each of the three years in the period ended December 31, 2003, in
conformity with accounting principles generally accepted in the United States of
America.  These  financial  statements are the  responsibility  of the Company's
management;  our  responsibility  is to express  an  opinion on these  financial
statements  based on our  audits.  We  conducted  our audits of these  financial
statements  in  accordance  with auditing  standards  generally  accepted in the
United  States of America,  which  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,  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.

As discussed in Note 1 to the consolidated financial statements,  effective
January 1, 2002 the Company  changed its method of  accounting  for goodwill and
other intangible assets.

PricewaterhouseCoopers LLP

Dallas, Texas
February 23, 2004

F-2

COMPX INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

December 31, 2002 and 2003

(In thousands, except share data)

ASSETS                                                                     2002            2003
----            ----

Current assets:

Cash and cash equivalents                                                               $ 12,407      $  21,726
Accounts receivable, less allowance for
doubtful accounts of $812 and $1,075                                                     22,924         25,737
Income taxes receivable from affiliates                                                      352            306
Refundable income taxes                                                                    1,378          2,376
Inventories                                                                               28,876         26,317
Prepaid expenses and other current assets                                                  3,422          1,840
Deferred income taxes                                                                      1,983          1,920
--------       --------

Total current assets                                                                  71,342         80,222
--------       --------

Other assets:
Goodwill                                                                                  40,729         43,325
Other intangible assets                                                                    2,183          1,945
Prepaid rent                                                                                 426              -
Deferred income taxes                                                                          -            351
Other                                                                                        233            422
--------       --------

Total other assets                                                                    43,571         46,043
--------       --------

Property and equipment:
Land                                                                                       4,344          4,746
Buildings                                                                                 29,452         28,605
Equipment                                                                                102,347        121,142
Construction in progress                                                                   3,548            636
--------       --------
139,691        155,129
Less accumulated depreciation                                                             54,512         71,940
--------       --------

Net property and equipment                                                            85,179         83,189
--------       --------

$200,092       $209,454
========       ========

F-3

COMPX INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (CONTINUED)

December 31, 2002 and 2003

(In thousands, except share data)

LIABILITIES AND STOCKHOLDERS' EQUITY                                                  2002           2003
----           ----

Current liabilities:

Current maturities of long-term debt                                                    $      6      $   -   
Accounts payable and accrued liabilities                                                  21,318        24,019
Income taxes                                                                                 419             -
Deferred income taxes                                                                        408           505
--------      --------

Total current liabilities                                                             22,151        24,524
--------      --------

Noncurrent liabilities:
Long-term debt                                                                            31,000        26,000
Deferred income taxes                                                                      4,469         4,550
Deferred gain on sale/leaseback                                                              493            21
--------      --------

Total noncurrent liabilities                                                          35,962        30,571
--------      --------

Stockholders' equity:
Preferred stock, $.01 par value; 1,000 shares
authorized, none issued                                                                       -             -
Class A common stock, $.01 par value;
20,000,000 shares authorized; 6,219,680 and
6,228,680 shares issued                                                                      62            62
Class B common stock, $.01 par value;
10,000,000 shares authorized, issued and outstanding                                        100           100
Additional paid-in capital                                                               119,387       119,437
Retained earnings                                                                         44,049        43,433
Accumulated other comprehensive income -
currency translation                                                                    (10,304)        2,642
Treasury stock, at cost - 1,103,900 shares                                               (11,315)      (11,315)
--------      -------- 

Total stockholders' equity                                                           141,979       154,359
--------      --------

$200,092      $209,454
========      ========

Commitments and contingencies (Notes 1, 10 and 13)

See accompanying notes to consolidated financial statements.
F-4

COMPX INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

Years ended December 31, 2001, 2002 and 2003

(In thousands, except per share data)

2001          2002            2003
----          ----            ----

Net sales                                                               $211,422      $196,101       $207,543
Cost of goods sold                                                       167,884       163,181        172,843
--------      --------       --------

Gross margin                                                        43,538        32,920         34,700

Selling, general and administrative expense                               28,310        26,713         27,288
Restructuring charge                                                       2,742          -             3,303
--------      --------       --------

Operating income                                                    12,486         6,207          4,109

Gain on sale of plant facility                                             2,246          -              -
Other general corporate income (expense), net                              1,009          (910)          (532)
Interest expense                                                          (2,859)       (1,888)        (1,301)
--------      --------       -------- 

Income before income taxes                                          12,882         3,409          2,276

Provision for income taxes                                                 5,758         2,771          1,003
--------      --------       --------

Net income                                                        $  7,124      $    638       $  1,273
========      ========       ========

Basic and diluted earnings per common share                             $    .47      $    .04       $    .08
========      ========       ========

Cash dividends per share                                                $    .50      $    .50       $   .125
========      ========       ========

Shares used in the calculation of earnings per share amounts for:
Basic earnings per share                                                15,144        15,110         15,121
Dilutive impact of stock options                                             6             8           -
--------      --------       -----

Diluted earnings per share                                              15,150        15,118         15,121
========      ========       ========

See accompanying notes to consolidated financial statements.
F-5

COMPX INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Years ended December 31, 2001, 2002 and 2003

(In thousands)

2001              2002             2003
----              ----             ----

Net income                                                        $ 7,124          $   638           $ 1,273
-------          -------           -------

Other comprehensive income - currency translation adjustment:
Pre-tax amount                                                 (5,097)           5,643            13,080
Less income taxes (benefit)                                      (207)             (66)              134
-------          -------           -------

Total other comprehensive income                               (4,890)           5,709            12,946
-------          -------           -------

Comprehensive income                                        $ 2,234          $ 6,347           $14,219
=======          =======           =======

See accompanying notes to consolidated financial statements.
F-6

COMPX INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years ended December 31, 2001, 2002 and 2003

(In thousands)

2001          2002           2003
----          ----           ----

Cash flows from operating activities:

Net income                                                                   $  7,124      $    638      $  1,273
Depreciation and amortization                                                  14,769        13,004        14,780
Deferred income taxes                                                           1,355          (750)         (444)
Gain on sale of plant facility                                                 (2,246)            -             -
Other, net                                                                        465           604         1,068
Change in assets and liabilities:
Accounts receivable                                                           6,112         1,301          (721)
Inventories                                                                   4,075         3,052         5,103
Accounts payable and accrued liabilities                                     (3,983)       (2,798)          874
Accounts with affiliates                                                        (38)          (16)           46
Income taxes                                                                    202         1,561           668
Other, net                                                                     (172)          342         1,798
--------      --------      --------

Net cash provided by operating activities                                  27,663        16,938        24,445
--------      --------      --------

Cash flows from investing activities:
Capital expenditures                                                          (13,283)      (12,703)       (8,908)
Proceeds from sale of plant facility                                           10,000             -             -
Other, net                                                                        605            32           671
--------      --------      --------

Net cash used by investing activities                                      (2,678)      (12,671)       (8,237)
--------      --------      -------- 

Cash flows from financing activities:
Long-term debt:
Borrowings                                                                   14,919         1,000         1,000
Principal payments                                                           (6,511)      (19,050)       (6,006)
Issuance of common stock                                                            -           120             -
Dividends paid                                                                 (7,553)       (7,555)       (1,889)
Common stock reacquired                                                        (2,650)            -             -
Other                                                                            -             -             (426)
--------      --------      -------- 

Net cash used in financing activities                                      (1,795)      (25,485)       (7,321)
--------      --------      -------- 

Net increase (decrease)                                                        $ 23,190      $(21,218)     $  8,887
========      ========      ========

F-7

COMPX INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

Years ended December 31, 2001, 2002 and 2003

(In thousands)

2001          2002          2003
----          ----          ----

Cash and cash equivalents:
Net increase (decrease) from:
Operating, investing and financing

activities                                                               $23,190       $(21,218)     $ 8,887
Currency translation                                                          299            316          432
Balance at beginning of year                                                  9,820         33,309       12,407
-------       --------      -------

Balance at end of year                                                      $33,309       $ 12,407      $21,726
=======       ========      =======

Supplemental disclosures:
Cash paid for:
Interest                                                                  $ 3,238       $  1,877      $ 1,722
Income taxes                                                                4,126          2,788        2,675

See accompanying notes to consolidated financial statements.
F-8

COMPX INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

Years ended December 31, 2001, 2002 and 2003

(In thousands)

Accumulated
other
comprehensive
Common stock  Additional             income -    ned           Total
------------   paid-in   Retained    currency    Treasury   stockholders'
Class A  Class B capital   Earnings   translation    stock       equity
-------  ------- -------   --------   -----------  --------    ----------

Balance at December 31, 2000   $62   $100   $119,194   $ 51,395    $(11,123)   $ (8,665)   $ 150,963

Net income .................    --    --        --        7,124        --          --          7,124
Other comprehensive income .    --    --        --         --        (4,890)       --         (4,890)
Cash dividends .............    --    --        --       (7,553)       --          --         (7,553)
Issuance of common stock ...    --    --          30       --          --          --             30
Common stock reacquired ....    --    --        --         --          --        (2,650)      (2,650)
---   ----   --------   --------    --------    --------    ---------

Balance at December 31, 2001    62    100    119,224     50,966     (16,013)    (11,315)     143,024

Net income .................    --    --        --          638        --          --            638
Other comprehensive income .    --    --        --         --         5,709        --          5,709
Cash dividends .............    --    --        --       (7,555)       --          --         (7,555)
Issuance of common stock ...    --    --         156       --          --          --            156
Other ......................    --    --           7       --          --          --              7
---   ----   --------   --------    --------    --------    ---------

Balance at December 31, 2002    62    100    119,387     44,049     (10,304)    (11,315)     141,979

Net income .................    --    --        --        1,273        --          --          1,273
Other comprehensive income .    --    --        --         --        12,946        --         12,946
Cash dividends .............    --    --        --       (1,889)       --          --         (1,889)
Issuance of common stock ...    --    --          50       --          --          --             50
---   ----   --------   --------    --------    --------    ---------

Balance at December 31, 2003   $62   $100   $119,437   $ 43,433    $  2,642    $(11,315)   $ 154,359
===   ====   ========   ========    ========    ========    =========

See accompanying notes to consolidated financial statements.
F-9

COMPX INTERNATIONAL INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - Summary of significant accounting policies:

Organization.  CompX  International Inc. (NYSE: CIX) is 69% owned by Valhi,
Inc. (NYSE: VHI) and Valhi's  wholly-owned  subsidiary Valcor,  Inc. at December
31, 2003. The Company  manufactures and sells component products (precision ball
bearing slides,  security products and ergonomic  computer support systems).  At
December 31, 2003, Contran Corporation holds,  directly or through subsidiaries,
approximately  90% of Valhi's  outstanding  common stock.  Substantially  all of
Contran's outstanding voting stock is held by trusts established for the benefit
of certain children and grandchildren of Harold C. Simmons, of which Mr. Simmons
is sole  trustee.  Mr.  Simmons,  the  Chairman of the Board of each of Contran,
Valhi and  Valcor,  may be  deemed to  control  each of such  companies  and the
Company.

Management estimates. The preparation of financial statements in conformity
with accounting  principles  generally  accepted in the United States of America
("GAAP")  requires  management to make estimates and assumptions that affect the
reported  amounts of assets and liabilities and disclosure of contingent  assets
and liabilities at the date of the financial statements, and the reported amount
of revenues and expenses during the reporting period.  Actual results may differ
from previously-estimated amounts under different assumptions or conditions.

Principles  of  consolidation.   The  accompanying  consolidated  financial
statements   include  the   accounts  of  CompX   International   Inc.  and  its
majority-owned  subsidiaries.  All material  intercompany  accounts and balances
have been  eliminated.  Certain  prior year  amounts have been  reclassified  to
conform to the current year  presentation.  The Company has no involvement  with
any variable  interest  entity covered by the scope of FASB  Interpretation  No.
46R, Consolidation of Variable Interest Entities.

Fiscal  year.  The  Company's  operations  are  reported on a 52 or 53-week
fiscal year. The years ended December 31, 2001,  2002 and 2003 each consisted of
52 weeks, and the year ended December 31, 2004 will be a 53-week year.

Translation of foreign  currencies.  Assets and liabilities of subsidiaries
whose  functional  currency  is other  than the U.S.  dollar are  translated  at
year-end rates of exchange and resulting translation adjustments are accumulated
in stockholders'  equity as part of accumulated other comprehensive  income, net
of  related  applicable  deferred  income  taxes.   Revenues  and  expenses  are
translated  at average  exchange  rates  prevailing  during  the year.  Currency
transaction gains and losses are recognized in income currently.

Cash and cash  equivalents.  Cash equivalents  consist  principally of bank
time deposits and government and  commercial  notes with original  maturities of
three months or less.

Net sales. Sales are recorded when products are shipped and title and other
risks and rewards of ownership  have passed to the customer.  Shipping terms are
generally F.O.B. shipping point, although in some instances,  shipping terms are
F.O.B.  destination  point (for which sales are  recognized  when the product is
received  by the  customer).  Amounts  charged to  customers  for  shipping  and
handling  are not  material.  Sales are stated net of price,  early  payment and
distributor discounts and volume rebates.

Accounts  receivable.  The  Company  provides  an  allowance  for  doubtful
accounts for known and potential  losses rising from sales to customers based on
a periodic review of these accounts.

F-10

Inventories and cost of sales.  Inventories are stated at the lower of cost
or  market,   net  of  allowance  for  obsolete  and  slow-moving   inventories.
Inventories are based on average cost or the first-in, first-out method. Cost of
sales  includes  costs  for  materials,  packing  and  finishing,  shipping  and
handling, utilities, salary and benefits, maintenance and depreciation.

Selling,  general  and  administrative   expenses.   Selling,  general  and
administrative expenses include costs related to marketing, sales, distribution,
and  administrative  functions  such as  accounting,  treasury and finance,  and
includes costs for salaries and benefits, travel and entertainment,  promotional
materials and professional fees.

Goodwill and other  intangible  assets.  Goodwill  represents the excess of
cost over fair value of individual net assets acquired in business  combinations
accounted for by the purchase method.  Through  December 31, 2001,  goodwill was
amortized by the straight-line method over not more than 20 years. Upon adoption
of Statement of Financial  Accounting  Standards  ("SFAS") No. 142, Goodwill and
Other  Intangible  Assets,  effective  January 1, 2002,  goodwill  was no longer
subject to  periodic  amortization.  Goodwill  and other  intangible  assets are
stated net of accumulated amortization. See Note 4.

Other intangible assets,  consisting of the estimated fair value of certain
patents acquired,  are amortized by the  straight-line  method over the lives of
such patents  (approximately  10 years remaining at December 31, 2003),  with no
assumed  residual value at the end of the life of the patents.  Other intangible
assets are stated net of  accumulated  amortization  of $1.2 million at December
31,  2002 and $1.5  million  at  December  31,  2003.  Amortization  expense  of
intangible  assets was $229,000 in 2001,  $240,000 in 2002 and $234,000 in 2003,
and is expected to be approximately $250,000 in each of 2004 through 2008.

Through  December  31,  2001,  when  events  or  changes  in  circumstances
indicated  that  goodwill  or  other  intangible  assets  may  be  impaired,  an
evaluation was performed to determine if an impairment  existed.  Such events or
circumstances  included,  among other  things,  (i) a  prolonged  period of time
during which the Company's net carrying value of its investment in  subsidiaries
whose common  stocks are publicly  traded was greater than quoted  market prices
for such stocks and (ii)  significant  current and prior  periods or current and
projected periods with operating losses related to the applicable business unit.
All relevant  factors  were  considered  in  determining  whether an  impairment
existed. If an impairment was determined to exist, goodwill and, if appropriate,
the underlying long-lived assets associated with the goodwill, were written down
to reflect the estimated  future  discounted cash flows expected to be generated
by the underlying  business.  Effective  January 1, 2002, the Company  commenced
assessing  impairment of goodwill and other intangible assets in accordance with
SFAS No. 142. See Note 4.

Property,  equipment and  depreciation.  Property and equipment,  including
purchased  computer software for internal use, are stated at cost.  Expenditures
for maintenance, repairs and minor renewals are expensed; expenditures for major
improvements are capitalized.  Depreciation for financial  reporting purposes is
computed principally by the straight-line method over the estimated useful lives
of 15 to 40  years  for  buildings  and  three  to 10 years  for  equipment  and
software.  Accelerated depreciation methods are used for income tax purposes, as
permitted. Upon sale or retirement of an asset, the related cost and accumulated
depreciation are removed from the accounts and any gain or loss is recognized in
income currently.

When  events or  changes  in  circumstances  indicate  that  assets  may be
impaired,  an evaluation is performed to determine if an impairment exists. Such
events or changes in circumstances  include, among other things, (i) significant
current  and prior  periods or current  and  projected  periods  with  operating

F-11

losses,  (ii) a significant  decrease in the market value of an asset or (iii) a
significant  change  in the  extent  or  manner  in which an asset is used.  All
relevant  factors  are  considered.  The test for  impairment  is  performed  by
comparing the estimated  future  undiscounted  cash flows (exclusive of interest
expense)  associated  with  the  asset  to the  asset's  net  carrying  value to
determine  if a  write-down  to market  value or  discounted  cash flow value is
required.  Through  December 31, 2001, if the asset being tested for  impairment
was acquired in a business combination accounted for by the purchase method, any
goodwill which arose out of that business combination was also considered in the
impairment test if the goodwill  related  specifically to the acquired asset and
not to other  aspects of the acquired  business,  such as the  customer  base or
product lines. Effective January 1, 2002, the Company began assessing impairment
of goodwill in  accordance  with SFAS No. 142, and the Company  began  assessing
impairment  of other  long-lived  assets  (such as property  and  equipment)  in
accordance  with SFAS No. 144  Accounting  for the  Impairment  or  Disposal  of
Long-Lived Assets. SFAS No. 144 retains the fundamental provisions of prior GAAP
with respect to the recognition and measurement of long-lived  asset  impairment
contained in SFAS No. 121,  Accounting for the  Impairment of Long-Lived  Assets
and for Lived-Lived Assets to be Disposed Of. However, SFAS No. 144 provides new
guidance intended to address certain  implementation issues associated with SFAS
No. 121,  including  expanded guidance with respect to appropriate cash flows to
be used to determine  whether  recognition of any long-lived asset impairment is
required, and if required how to measure the amount of the impairment.  SFAS No.
144  also  requires  that any net  assets  to be  disposed  of by sale are to be
reported  at the lower of  carrying  value or fair value less cost to sell,  and
expands the reporting of discontinued  operations to include any component of an
entity with operations and cash flows that can be clearly distinguished from the
rest of the entity.  Adoption of SFAS No. 144 did not have a significant  effect
on the Company as of January 1, 2002. See Note 4.

Self-insurance.   The  Company  is  partially   self-insured  for  workers'
compensation  and certain  employee health benefits and is self-insured for most
environmental issues. Stop-loss coverage is purchased by the Company in order to
limit its  exposure  to any  significant  levels  of  workers'  compensation  or
employee  health  benefit  claims.  Self-insured  losses are accrued  based upon
estimates of the aggregate liability for uninsured claims incurred using certain
actuarial  assumptions  followed in the insurance industry and the Company's own
historical claims experience.

Derivatives  and  hedging  activities.   Certain  of  the  Company's  sales
generated  by its non-U.S.  operations  are  denominated  in U.S.  dollars.  The
Company  periodically  uses currency forward  contracts to manage a very nominal
portion of foreign exchange rate risk associated with receivables denominated in
a currency other than the holder's  functional currency or similar exchange rate
risk  associated  with future  sales.  The  Company  has not entered  into these
contracts for trading or speculative  purposes in the past, nor does the Company
currently  anticipate  entering into such  contracts for trading or  speculative
purposes  in the  future.  At each  balance  sheet  date,  any such  outstanding
currency  forward contract is  marked-to-market  with any resulting gain or loss
recognized in income currently as part of net currency  transactions.  To manage
such  exchange  rate risk,  at December 31,  2003,  the Company held a series of
contracts to exchange an aggregate of U.S. $4.2 million for an equivalent amount
of  Canadian  dollars at  exchange  rates of Cdn.  $1.30 to Cdn.  $1.33 per U.S.
dollar. Such contracts mature through February 2004. The exchange rate was $1.31
per U.S.  dollar at December  31,  2003.  At December  31, 2002 the Company held
contracts  maturing  through  January 2003 to exchange an aggregate of U.S. $2.5
million for an equivalent amount of Canadian dollars at an exchange rate of Cdn.
$1.57 per U.S.  dollar.  At December 31, 2002, the actual exchange rate was Cdn.
$1.57 per U.S. dollar.

F-12

Income  taxes.  The  Company is a separate  United  States  federal  income
taxpayer and is not a member of Contran's  consolidated  United  States  federal
income tax group.  The  Company is however a part of  consolidated  tax  returns
filed  by  Contran  in  certain  United  States  state  jurisdictions.  For such
consolidated state tax returns, intercompany allocations of state tax provisions
are computed on a separate company basis. Payments are made to, or received from
Contran  in the  amounts  that  would  have  been paid to or  received  from the
respective  state tax  authority  had CompX not been a part of the  consolidated
state tax return.

Deferred  income tax assets and liabilities are recognized for the expected
future tax  consequences  of  temporary  differences  between the income tax and
financial  reporting  carrying  amounts  of assets  and  liabilities,  including
undistributed  earnings  of  foreign  subsidiaries  which  are not  deemed to be
permanently  reinvested.  The Company  periodically  evaluates  its deferred tax
assets in the various taxing  jurisdictions in which it operates and adjusts any
related valuation allowance based on the estimate of the amount of such deferred
tax assets which the Company  believes does not meet the  "more-likely-than-not"
recognition criteria.  Earnings of foreign subsidiaries deemed to be permanently
reinvested  aggregated  $45  million at December  31, 2002 and $43.1  million at
December 31, 2003.

Earnings per share.  Basic earnings per share of common stock is based upon
the weighted  average number of common shares actually  outstanding  during each
period.  Diluted  earnings  per share of common  stock  includes  the  impact of
outstanding  dilutive stock options.  The weighted average number of outstanding
stock  options  excluded  from the  calculation  of diluted  earnings  per share
because  their  impact  would have been  antidilutive  aggregated  approximately
746,000 in 2001, 819,000 in 2002 and 713,000 in 2003.

Stock options. At December 31, 2003, the Company has a stock-based employee
compensation plan, which is described more fully in Note 9. The Company accounts
for  stock-based  employee  compensation  related  to stock  options  using  the
intrinsic value method in accordance with  Accounting  Principles  Board Opinion
("APBO")  No. 25,  Accounting  for Stock  Issued to  Employees,  and its various
interpretations. Under APBO No. 25, no compensation cost is generally recognized
for fixed stock options in which the exercise  price is greater than or equal to
the market price on the grant date.  Compensation cost recognized by the Company
related to stock options in accordance with APBO No. 25 has not been significant
in any of the past three years.  The following  table  illustrates the effect on
net income and  earnings  per share if the  Company  had  applied the fair value
recognition provisions of SFAS No. 123, Accounting for Stock-Based  Compensation
to stock-based  employee  compensation  related to stock options for all options
granted on or after January 1, 1995.

F-13

Years ended December 31,
2001          2002          2003
----          ----          ----
(In thousands,
except per share data)

Net income, as reported                                                    $ 7,124       $   638       $1,273
Deduct:  Total stock-based employee
compensation expense related to stock options
determined under fair value based method
for all awards, net of related tax effects                                (1,486)       (1,572)        (875)
-------       -------       ------ 

Pro forma net income (loss)                                                $ 5,638       $  (934)      $  398
=======       =======       ======

Earnings (loss) per share - basic and diluted:
As reported                                                              $   .47       $   .04       $  .08
=======       =======       ======

Pro forma                                                                $   .37       $  (.06)      $  .03
=======       =======       ======

Fair value of  financial  instruments.  The  carrying  amounts of  accounts
receivable and accounts payable  approximates fair value due to their short-term
nature.  The carrying amount of indebtedness  approximates fair value due to the
stated  interest rate  approximating  a market rate.  These estimated fair value
amounts  have  been  determined  using  available  market  information  or other
appropriate valuation methodologies.

Other.  Advertising costs,  expensed as incurred,  were $1,026,000 in 2001,
$879,000 in 2002 and $588,000 in 2003. Research and development costs,  expensed
as incurred, were $510,000 in 2001, $659,000 in 2002, and $469,000 in 2003.

Note 2 - Business and geographic segments:

The  Company's   operating  segments  are  defined  as  components  of  its
operations  about which  separate  financial  information  is available  that is
regularly  evaluated by the chief operating decision maker in determining how to
allocate resources and in assessing  performance.  The Company's chief operating
decision maker is Mr. David Bowers, president and chief executive officer of the
Company.  The Company has three  operating  segments - CompX Security  Products,
CompX Waterloo and Thomas  Regout.  The CompX Security  Products  segment,  with
manufacturing  facilities in South Carolina and Illinois,  manufactures  locking
mechanisms  and  other  security  products  for  sale to the  office  furniture,
banking,  vending,  computer and other  industries.  The CompX Waterloo segment,
with facilities in Canada,  Michigan and Taiwan,  and the Thomas Regout segment,
with facilities in the  Netherlands,  both manufacture and distribute a complete
line  of   precision   ball  bearing   slides  for  use  in  office   furniture,
computer-related  equipment,  tool  storage  cabinets  and  other  applications.
Additionally, the CompX Waterloo segment manufacturers and distributes ergonomic
computer  support  systems  for office  furniture.  Previously,  the Company had
aggregated the CompX Waterloo and Thomas Regout operating segments into a single
reportable  segment  because  of  similar  economic  characteristics,  products,
customer types,  production  processes,  and  distribution  methods.  Due to the
continued weakness in the European office furniture market and the divergence in
operating income between the two segments,  the Company  determined in the third
quarter  of 2003  that  these  two  segments  no longer  have  similar  economic
characteristics,  and  accordingly  the Company no longer  aggregates  the CompX
Waterloo  and Thomas  Regout  operating  segments.  Aggregated  segment  amounts
reported  for  CompX  Waterloo/Thomas  Regout  in  previous  periods  have  been
reclassified  to conform to the  current  presentation.  Intersegment  sales are
intercompany shipments from Thomas Regout to CompX Waterloo.

F-14

The chief operating  decision maker evaluates segment  performance based on
segment  operating  income,  which is defined as income before income taxes, and
interest  expense,  exclusive of certain  general  corporate  income and expense
items  (including  interest income and foreign  exchange  transaction  gains and
losses)  and  certain  non-recurring  items  (such  as gains  or  losses  on the
disposition of business units and other  long-lived  assets outside the ordinary
course of business).  All corporate office  operating  expenses are allocated to
the three reportable segments based upon the segments' net sales. The accounting
policies of the reportable operating segments are the same as those described in
Note 1. Capital  expenditures  include additions to property and equipment,  but
exclude  amounts  attributable  to business  combinations  accounted  for by the
purchase method.

Segment assets are comprised of all assets  attributable  to the reportable
segments.  Corporate assets are not  attributable to the operating  segments and
consist primarily of cash and cash equivalents.  For geographic information, net
sales are  attributable  to the place of  manufacture  (point of origin) and the
location of the customer  (point of  destination);  property and  equipment  are
attributable to their physical location.  At December 31, 2002 and 2003, the net
assets of non-U.S. subsidiaries included in consolidated net assets approximated
$82 million and $88 million, respectively.

Years ended December 31,
2001          2002           2003
----          ----           ----
(In thousands)

Net sales:

CompX Waterloo                                                            $105,135      $ 93,116       $ 97,518
CompX Security Products                                                     74,071        73,358         76,155
Thomas Regout                                                               33,303        31,278         35,331
Intersegment sales                                                          (1,087)       (1,651)        (1,461)
--------      --------       -------- 

Total net sales                                                         $211,422      $196,101       $207,543
========      ========       ========

Operating income (loss):
CompX Waterloo                                                            $  8,596      $ (1,213)      $    394
CompX Security Products                                                      7,320         8,076          9,743
Thomas Regout                                                               (3,430)         (656)        (6,028)
--------      --------       -------- 

Total operating income                                                    12,486         6,207          4,109

Interest expense                                                            (2,859)       (1,888)        (1,301)
Gain on sale of plant facility                                               2,246             -              -
Other general corporate income (expense), net                                1,009          (910)          (532)
--------      --------       -------- 

Income before income taxes                                              $ 12,882      $  3,409       $  2,276
========      ========       ========

Depreciation and amortization:
CompX Waterloo                                                            $  6,631      $  6,450       $  7,281
CompX Security Products                                                      5,633         4,769          4,843
Thomas Regout                                                                2,505         1,785          2,656
--------      --------       --------

$ 14,769      $ 13,004       $ 14,780
========      ========       ========

Capital expenditures:
CompX Waterloo                                                            $  5,891      $  8,601       $  6,446
CompX Security Products                                                      6,452         1,582          1,901
Thomas Regout                                                                  940         2,520            561
--------      --------       --------

$ 13,283      $ 12,703       $  8,908
========      ========       ========

F-15

Years ended December 31,
2001          2002           2003
----          ----           ----
(In thousands)

Net sales:
Point of origin:

Canada                                                                  $ 82,027      $ 71,462       $ 76,307
United States                                                             88,567        86,722         94,298
The Netherlands                                                           33,303        31,278         35,331
Taiwan                                                                    11,665        14,688         13,405
Eliminations                                                              (4,140)       (8,049)       (11,798)
--------      --------       -------- 

$211,422      $196,101       $207,543
========      ========       ========

Point of destination:
United States                                                           $130,534      $126,182       $127,032
Canada                                                                    35,475        29,601         32,363
Europe                                                                    37,097        33,115         37,483
Other                                                                      8,316         7,203         10,665
--------      --------       --------

$211,422      $196,101       $207,543
========      ========       ========

December 31,
2001          2002           2003
----          ----           ----
(In thousands)
Total assets:

CompX Waterloo                                                            $ 90,348      $ 73,411       $ 90,457
CompX Security Products                                                     92,503        87,795         79,619
Thomas Regout                                                               38,154        37,860         36,322
Corporate and eliminations                                                   1,871         1,026          3,056
--------      --------       --------

$222,876      $200,092       $209,454
========      ========       ========

Goodwill:
CompX Waterloo                                                            $  4,901      $  4,846       $  4,986
CompX Security Products                                                     23,743        23,743         23,743
Thomas Regout                                                               10,238        12,140         14,596
--------      --------       --------

$ 38,882      $ 40,729       $ 43,325
========      ========       ========

Net property and equipment:
United States                                                              $ 48,863      $ 46,251      $ 44,499
Canada                                                                       23,420        23,046        23,341
The Netherlands                                                               7,323        10,034         9,639
Taiwan                                                                        5,430         5,848         5,710
--------      --------      --------

$ 85,036      $ 85,179      $ 83,189
========      ========      ========

Note 3 - Inventories:

December 31,
2002           2003
----           ----
(In thousands)

Raw materials                                                                             $ 6,573        $ 6,170
Work in process                                                                            12,602         10,852
Finished products                                                                           9,532          9,166
Supplies                                                                                      169            129
-------        -------

$28,876        $26,317
=======        =======

F-16

Note 4 - Goodwill:

Goodwill.  The Company adopted SFAS No. 142,  Goodwill and Other Intangible
Assets,  effective  January 1, 2002.  Under SFAS No. 142,  goodwill is no longer
amortized on a periodic  basis.  Goodwill is subject to an impairment test to be
performed at least on an annual basis, and such impairment reviews may result in
future periodic write-downs charged to earnings. Under the transition provisions
of SFAS No.  142,  all  goodwill  existing  as of June  30,  2001  ceased  to be
periodically  amortized  as of January 1, 2002,  and all  goodwill  arising in a
purchase  business  combination  completed  on or  after  July 1,  2001  was not
periodically amortized from the date of such combination.

The Company has assigned its goodwill to the three reporting units (as that
term is  defined  in SFAS No.  142)  which  correspond  to the  three  operating
segments. Under SFAS No. 142, such goodwill will be deemed to not be impaired if
the estimated fair value of the applicable reporting unit exceeds the respective
net carrying value of such reporting unit, including the allocated goodwill.  If
the  fair  value of the  reporting  unit is less  than  carrying  value,  then a
goodwill impairment loss would be recognized equal to the excess, if any, of the
net carrying  value of the  reporting  unit goodwill over its implied fair value
(up to a maximum  impairment  equal to the carrying value of the goodwill).  The
implied fair value of reporting  unit goodwill  would be the amount equal to the
excess of the estimated  fair value of the  reporting  unit over the amount that
would be allocated to the tangible and  intangible  net assets of the  reporting
unit (including  unrecognized  intangible  assets) as if such reporting unit had
been  acquired in a purchase  business  combination  accounted for in accordance
with GAAP as of the date of the impairment testing.

In determining the estimated fair value of the reporting units, the Company
uses  appropriate  valuation  techniques,  such as  discounted  cash  flows,  to
estimate  the fair value of the  reporting  units.  The  Company  completed  its
initial,  transitional  goodwill  impairment  analysis  under SFAS No. 142 as of
January 1, 2002,  and no  goodwill  impairments  were deemed to exist as of such
date. Starting in 2002, in accordance with the requirements of SFAS No. 142, the
Company reviews  goodwill for impairment  during the third quarter of each year.
Goodwill  will also be reviewed for  impairment  at other times during each year
when events or changes in  circumstances  indicate that an  impairment  might be
present.  No  goodwill  impairments  were  deemed  to exist  as a result  of the
Company's impairment review completed during 2002 or 2003.

F-17

The following  table presents what the Company's  consolidated  net income,
and  related  per  share  amounts,  would  have  been in  2001  if the  goodwill
amortization  included in the Company's reported consolidated net income had not
been recognized.

Years ended December 31,
2001            2002           2003
----            ----           ----
(In millions,
except per share data)

Net income, as reported                                                 $7.1           $ .6            $1.3
Goodwill amortization                                                    2.3             -               -
Incremental income taxes                                                  -              -               -
----           ----            ---
Adjusted net income                                                   $9.4           $ .6            $1.3
====           ====            ====

Basic and diluted net income per share,
as reported                                                            $.47           $.04            $.08

Goodwill amortization                                                    .15             -               -
Incremental income taxes                                                  -              -               -
----           ----            ---
Adjusted basic and diluted net
income per share                                                     $.62           $.04            $.08
====           ====            ====

Changes in the carrying  amount of goodwill  during the past three years is
presented  in  the  table  below.   Goodwill  was  generated   principally  from
acquisitions of certain business units during 1998, 1999 and 2000.

CompX
CompX          Security         Thomas
Waterloo         Products         Regout          Total
(In millions)

Balance at December 31, 2000                               $ 5.4            $25.1          $11.7            $42.2

Changes in currency
exchange rates                                              (.2)             -              (.8)            (1.0)
Periodic amortization                                        (.3)            (1.4)           (.6)            (2.3)
-----            -----          -----            -----

Balance at December 31, 2001                                 4.9             23.7           10.3             38.9

Changes in currency
exchange rates                                              -                -              1.8              1.8
-----            -----          -----            -----

Balance at December 31, 2002                                 4.9             23.7           12.1             40.7

Changes in currency
exchange rates                                               .1              -              2.5              2.6
-----            -----          -----            -----

Balance at December 31, 2003                               $ 5.0            $23.7          $14.6            $43.3
=====            =====          =====            =====

F-18

Note 5 -       Accounts payable and accrued liabilities:

December 31,
2002           2003
----           ----
(In thousands)

Accounts payable ...............................         $ 9,106         $ 8,597
Accrued liabilities:
Employee benefits ............................           7,065           7,660
Insurance ....................................             478             374
Royalties ....................................             246             243
Restructuring ................................             540           3,223
Sales rebates ................................             845             805
Deferred gain on sale/leaseback ..............             805             485
Other ........................................           2,233           2,632
-------         -------

$21,318         $24,019
=======         =======

Due to continued operating losses at the Company's Thomas Regout subsidiary
in Europe resulting from the continued downturn in the European office furniture
market,  the Company commenced a strategic analysis of the Thomas Regout segment
during  the  third  quarter  of 2003.  As part of the  ongoing  analysis  of the
operations, the Company determined that it should significantly reduce headcount
in the operations in order to be competitive. Prior to the end of September, the
Company  finalized  and  communicated  to the  employees  a  restructuring  plan
detailing the cost to terminate approximately 100 employees, and accordingly the
Company recognized a $3.5 million  restructuring  charge in the third quarter of
2003 related to the headcount  reduction.  The charge represents severance to be
paid to the terminated  employees,  which is expected to be paid through the end
of the second  quarter  of 2004.  In the fourth  quarter  of 2003,  the  Company
lowered the charge by $225,000 as the result of changes in estimates  and timing
of  individual  severance  benefits,  and the Company paid $487,000 in severance
benefits.  Also in the fourth quarter of 2003,  changes in the currency exchange
rate between the U.S.  dollar and the euro increased the translated  U.S. dollar
liability by $407,000.  Substantially all of the remaining severance is expected
to be paid during 2004.

In 2001, the Company also  recognized a charge of $2.7 million related to a
consolidation  and   rationalization  of  CompX's  European   operations.   This
restructuring  effort  included  headcount  reductions  of  about  35  employees
substantially  all of which had been  implemented  by December 31, 2001.  Due to
adjustments  for changes in currency  exchange  rates,  through January 31, 2003
approximately  $3.0 million has been paid (including  approximately  $.6 million
during January 2003), and no amounts remain to be paid.

Note 6 - Indebtedness:

December 31,
2002           2003
----           ----
(In thousands)

Revolving bank credit facility .................         $31,000         $26,000
Other ..........................................               6            --
-------         -------
31,006          26,000
Less current portion ...........................               6            --
-------         -------

$31,000         $26,000

F-19

At December 31, 2003,  the Company has a $47.5  million  secured  revolving
bank credit  facility  maturing in January  2006 which  bears  interest,  at the
Company's option, at rates based on either the prime rate or LIBOR (resulting in
a  weighted-average  interest  rate of 3.2% at December  31,  2003).  The credit
facility is  collateralized  by substantially all of the Company's United States
tangible  assets and a pledge of at least 65% of the ownership  interests in the
Company's  first-tier  foreign  subsidiaries.   The  facility  contains  certain
covenants and restrictions customary in lending transactions of this type, which
among other things, restricts the ability of CompX and its subsidiaries to incur
debt, incur liens, pay dividends,  merge or consolidate with, or transfer all or
substantially all of their assets to another entity.  The facility also requires
maintenance  of specified  levels of net worth (as  defined).  In the event of a
change of control of CompX,  as  defined,  the  lenders  would have the right to
accelerate  the  maturity of the  facility.  CompX would also be required  under
certain  conditions to use the net proceeds from the sale of assets  outside the
ordinary course of business to reduce outstanding borrowings under the facility,
and such a transaction would also result in a permanent reduction of the size of
the  facility.  At December 31, 2003,  $21.5 million was available for borrowing
under the terms of the  facility.  In  January  2004,  the  Company  repaid  $12
million, using available cash on hand.

The credit facility permits the Company to pay dividends and/or  repurchase
its common  stock in an amount  equal to the sum of (i) a dividend  of $.125 per
share in any calendar quarter,  not to exceed $8.0 million in any calendar year,
plus (ii) $6.0  million  plus 50% of  aggregate  net income over the term of the
credit facility.  At December 31, 2003, $7.6 million was available for dividends
and/or  repurchases  of the  Company's  common  stock  under  the  terms  of the
facility.

Amounts  outstanding  at  December  31, 2002 under a prior  unsecured  bank
credit facility, which matured in February 2003, were classified as a noncurrent
liability  because those  borrowings  were refinanced on a long-term basis under
the terms of the new secured bank credit facility.

Note 7 - Employee benefit plans:

Defined   contribution   plans.  The  Company   maintains  various  defined
contribution  plans  with  Company  contributions  based  on  matching  or other
formulas.  Defined  contribution plan expense  approximated  $1,720,000 in 2001,
$1,748,000 in 2002 and $1,832,000 in 2003.

Defined benefit plans.  Through  January 1, 2001, the Company  maintained a
defined benefit pension plan covering  substantially all full-time  employees of
Thomas Regout B.V. As of January 1, 2001,  the Company ceased  providing  future
benefits under the plan, thus reducing certain pension benefit  obligations.  In
connection with this curtailment,  the Company  recognized a curtailment gain of
approximately  $116,000 in 2001. Certain  obligations  related to the terminated
plan were not fully  settled  until 2002.  At December 31, 2001,  the  projected
benefit  obligation for this plan was approximately  $1.3 million,  and the fair
value of plan assets was approximately $1.0 million. During 2002, plan assets of
approximately $1.3 million (including  employer  contributions of $240,000) were
used to fully  settle  the  remaining  benefit  obligations,  at which  time the
Company  recognized a settlement  gain of  $677,000.  Net periodic  pension cost
(benefit)  related to this plan, other than the curtailment and settlement gains
discussed above, were not material during the past three years. See Note 11.

F-20

Note 8 - Income taxes:

The  components of pre-tax  income and the provision for income taxes,  the
difference  between the  provision for income taxes and the amount that would be
expected  using  the  U.S.  federal  statutory  income  tax  rate of 35% and the
comprehensive provision for income taxes are presented below.

Years ended December 31,
2001          2002           2003
----          ----           ----
(In thousands)
Components of pre-tax income (loss):

United States                                                              $  (998)     $ (1,913)       $ 6,258
Non-U.S.                                                                    13,880         5,322         (3,982)
-------      --------        ------- 

$12,882      $  3,409        $ 2,276
=======      ========        =======

Years ended December 31,
2001          2002           2003
----          ----           ----
(In thousands)

Provision for income taxes:
Currently payable (refundable):

U.S. federal and state                                                   $  (844)      $ 1,128        $   121
Foreign                                                                    5,247         2,394          1,326
-------       -------        -------

4,403         3,522          1,447
-------       -------        -------
Deferred income taxes (benefit):
U.S.                                                                       1,941          (114)         2,061
Foreign                                                                     (586)         (637)        (2,505)
-------       -------        ------- 

1,355          (751)          (444)
-------       -------        ------- 

$ 5,758       $ 2,771        $ 1,003
=======       =======        =======

Expected tax expense, at the U.S. federal
statutory income tax rate of 35%                                            $ 4,509       $ 1,193        $   797
Non-U.S. tax rates                                                              (353)         (290)          (123)
Incremental U.S. tax on earnings of
foreign subsidiary                                                              330         1,099            562
No tax benefit for goodwill amortization                                         693             -              -
State income taxes and other, net                                                579           769           (233)
-------       -------        ------- 

$ 5,758       $ 2,771        $ 1,003
=======       =======        =======

Comprehensive provision (benefit) for income tax benefit allocable to:
Pre-tax income                                                             $ 5,758       $ 2,771        $ 1,003
Other comprehensive income -
currency translation                                                         (207)          (66)           134
-------       -------        -------

$ 5,551       $ 2,705        $ 1,137
=======       =======        =======

F-21

The  components  of net deferred tax assets  (liabilities)  are  summarized
below.

December 31,
2002           2003
----           ----
(In thousands)

Tax effect of temporary differences related to:

Inventories                                                                               $   575        $    430
Property and equipment                                                                     (8,510)        (10,562)
Accrued liabilities and other deductible differences                                        2,087           1,252
Tax loss and credit carryforwards                                                           5,769           8,953
Other taxable differences                                                                  (2,815)         (2,857)
Valuation allowance                                                                          -               -
-------        -----

$(2,894)       $ (2,784)
=======        ======== 

Net current deferred tax assets                                                             $ 1,983        $  1,920
Net noncurrent deferred tax assets                                                                -             351
Net current deferred tax liabilities                                                           (408)           (505)
Net noncurrent deferred tax liabilities                                                      (4,469)         (4,550)
--------       -------- 

$(2,894)       $ (2,784)
========       ======== 

At  December  31,  2003,   the  Company  has  net  operating  loss  ("NOL")
carryforwards,  which expire in 2007 through 2018, of approximately $8.4 million
for U.S.  federal  income tax  purposes.  The NOL  carryforwards  arose from the
acquisition  of Thomas Regout USA, Inc.  These losses may only be used to offset
future taxable income of the acquired subsidiary and are not available to offset
taxable income of other subsidiaries. Utilization of certain portions of the NOL
carryforward is limited to approximately $400,000 annually. The Company utilized
none of such NOL  carryforward  in 2001, 2002 or 2003. At December 31, 2003, the
Company  also has the  equivalent  of  approximately  $16.2  million of tax loss
carryforwards  in the Netherlands  with no expiration date. The Company believes
that it is  more-likely-than-not  that all such NOLs will be  utilized to reduce
future income tax  liabilities.  Consequently,  no valuation  allowance has been
recorded to offset the deferred tax asset related to these NOLs.

Note 9 - Stockholders' equity:

Shares of common stock
---------------------------------------------------
Class A                    Class B
------------------------------------    -----------
Issued and
Issued       Treasury    Outstanding   outstanding
---------     --------    -----------   -----------

Balance at December 31, 2000    6,204,680     (844,300)    5,360,380    10,000,000

Issued .....................        2,500         --           2,500          --
Reacquired .................         --       (259,600)     (259,600)         --
----------   ----------    ----------    ----------

Balance at December 31, 2001    6,207,180   (1,103,900)    5,103,280    10,000,000

Issued .....................       12,500         --          12,500          --
----------   ----------    ----------    ----------

Balance at December 31, 2002    6,219,680   (1,103,900)    5,115,780    10,000,000

Issued .....................        9,000         --           9,000          --
----------   ----------    ----------    ----------

Balance at December 31, 2003    6,228,680   (1,103,900)    5,124,780    10,000,000
==========   ==========    ==========    ==========

F-22

Class A and Class B common  stock.  The shares of Class A Common  Stock and
Class B Common Stock are  identical in all respects,  except for certain  voting
rights  and  certain  conversion  rights in respect of the shares of the Class B
Common  Stock.  Holders  of Class A Common  Stock are  entitled  to one vote per
share.  Valcor,  which  holds  all of the  outstanding  shares of Class B Common
Stock,  is entitled to one vote per share in all matters  except for election of
directors,  for which Valcor is entitled to ten votes per share.  Holders of all
classes of common stock entitled to vote will vote together as a single class on
all matters presented to the stockholders for their vote or approval,  except as
otherwise  required by  applicable  law.  Each share of Class A Common Stock and
Class B Common Stock have an equal and ratable right to receive  dividends to be
paid from the Company's  assets when, and if declared by the Board of Directors.
In the event of the dissolution,  liquidation or winding up of the Company,  the
holders of Class A Common  Stock and Class B Common  Stock will be  entitled  to
share  equally  and  ratably  in the assets  available  for  distribution  after
payments are made to the Company's creditors and to the holders of any preferred
stock of the Company that may be outstanding at the time.  Shares of the Class A
Common Stock have no  conversion  rights.  Under certain  conditions,  shares of
Class B Common Stock will convert,  on a  share-for-share  basis, into shares of
Class A Common Stock.

Incentive  compensation  plan. The CompX  International Inc. 1997 Long-Term
Incentive  Plan  provides  for the  award  or  grant  of  stock  options,  stock
appreciation rights,  performance grants and other awards to employees and other
individuals providing services to the Company. Up to 1.5 million shares of Class
A Common Stock may be issued  pursuant to the plan.  Generally,  employee  stock
options  are granted at prices not less than the market  price of the  Company's
stock on the date of grant,  vest over five  years and expire ten years from the
date of grant.

The following  table sets forth changes in  outstanding  options during the
past three years.

Amount
Exercise           payable
price per             upon
Shares            share            exercise
------         ----------          --------
(In thousands, except
per share amounts)

Outstanding at December 31, 2000                                      722     $12.50 -$20.00             $13,781

Granted                                                               330      10.00 - 13.00               4,181
Canceled                                                             (196)      13.00 - 20.00             (3,691)
----      --------------            -------

Outstanding at December 31, 2001                                      856      10.00 - 20.00              14,271

Granted                                                                25      11.00 - 14.30                 328
Exercised                                                             (10)         12.06                    (120)
Canceled                                                             (107)     11.59 - 20.00              (1,484)
----     --------------             -------

Outstanding at December 31, 2002                                      764     $10.00 -$20.00             $12,995

Canceled                                                             (145)     11.00 - 20.00              (2,311)
----     --------------             -------
Outstanding at December 31, 2003                                      619     $10.00 -$20.00             $10,684
===     ==============             =======

Outstanding options at December 31, 2003 represent  approximately 4% of the
Company's  total  outstanding  shares of common  shares at that date and  expire
through 2012 with a weighted-average  remaining term of 6 years. At December 31,
2003,  options to purchase  452,000 of the Company's  shares were exercisable at
prices ranging from $10.00 to $20.00 per share,  or an aggregate  amount payable
upon exercise of $8.2 million, with a weighted-average  exercise price of $18.21
per share. These exercisable  options are exercisable  through 2012. All of such
exercisable options are exercisable at prices higher than the Company's December
31,  2003 market  price of $6.40 per share.  At December  31,  2003,  options to

F-23

purchase  73,000  shares  are  scheduled  to become  exercisable  in 2004 and an
aggregate of 633,000 shares were available for future grants.

Other. The pro forma  information  included in Note 1, required by SFAS No.
123, Accounting for Stock-Based  Compensation,  is based on an estimation of the
fair value of CompX options issued subsequent to January 1, 1998 (the first time
the Company granted stock options).  The  weighted-average  fair values of CompX
options  granted  during  2001 and 2002 were $4.53 and $5.05,  respectively  (no
options were granted in 2003).  The fair values of such options were  calculated
using  the  Black-Scholes  stock  option  valuation  model  with  the  following
weighted-average  assumptions:  stock price volatility of 37% to 45%,  risk-free
rates of return of 5.1% to 6.9%,  dividend yields of nil to 5.0% and an expected
term of 10 years. The  Black-Scholes  model was not developed for use in valuing
employee stock  options,  but was developed for use in estimating the fair value
of traded options that have no vesting  restrictions and are fully transferable.
In  addition,   it  requires  the  use  of  subjective   assumptions   including
expectations of future  dividends and stock price  volatility.  Such assumptions
are only used for making the  required  fair  value  estimate  and should not be
considered as indicators of future dividend policy or stock price  appreciation.
Because  changes in the subjective  assumptions  can materially  affect the fair
value  estimate  and  because   employee  stock  options  have   characteristics
significantly   different  from  those  of  traded  options,   the  use  of  the
Black-Scholes  stock option valuation model may not provide a reliable  estimate
of the fair value of employee stock options.

For  purposes of this pro forma  disclosure,  the  estimated  fair value of
options is amortized to expense over the options' vesting period. Such pro forma
impact  on  net  income  and  basic  and  dilutive  earnings  per  share  is not
necessarily indicative of future effects on net income or earnings per share.

Note 10 - Gain on sale of plant facility:

In 2001,  the Company  recorded a $2.2 million  pre-tax gain related to the
sale/leaseback of its manufacturing facility in the Netherlands. Pursuant to the
sale/leaseback,  CompX sold the manufacturing facility with a net carrying value
of $8.2 million for $10.0 million cash consideration in December 2001, and CompX
simultaneously  entered into a leaseback of the facility with a nominal  monthly
rental for between 36 and 48 months  depending on when the alternative  location
has cleared all regulatory hurdles. CompX has the option to extend the leaseback
period  for up to an  additional  two years with  monthly  rentals of $40,000 to
$100,000.  CompX may  terminate the  leaseback at any time without  penalty.  In
addition to the cash received up front,  CompX  included an estimate of the fair
market value of the monthly rental during the nominal-rental leaseback period as
part of the sale  proceeds.  A portion of the gain from the sale of the facility
after transaction  costs, equal to the present value of the monthly rentals over
the expected  leaseback  period  (including the fair market value of the monthly
rental during the nominal-rental  leaseback  period),  was deferred and is being
amortized into income over the expected  leaseback period.  CompX is recognizing
rental expense over the leaseback period,  including amortization of the prepaid
rent  consisting of the estimated fair market value of the monthly rental during
the nominal-rental  leaseback period.  Pursuant to the agreement,  CompX is also
obligated  to acquire up to 10 acres from the  municipality  of  Maastricht  for
approximately  $2.5  million  within the next four  years.  Acquisition  of this
property is subject to the  municipality  meeting certain  conditions which have
not yet been met.

F-24

Note 11 - Other general corporate income (expense), net:

Years ended December 31,
2001          2002           2003
----          ----           ----
(In thousands)

Net foreign currency transaction gain (loss)                                 $  636        $ (865)        $ (667)
Interest income                                                                 574           381            188
Defined benefit plan curtailment gain                                           116             -              -
Defined benefit plan settlement gain                                            -             677              -
Loss on disposal of property and equipment                                     (126)       (1,193)          (166)
Other income (expense), net                                                    (191)           90            113
------        ------         ------

$1,009        $ (910)        $ (532)
======        ======         ====== 

In 2002,  net losses on  disposal  of property  and  equipment  included $1
million  loss  related  to  the  retooling  of  the  Company's  precision  slide
manufacturing  facility in Byron Center,  Michigan. The remainder of the charges
for  retooling  are  recorded  as cost of goods  sold and  relate to the cost of
moving  and  installing  machinery  and  equipment  as well as the  disposal  of
obsolete inventory.

Note 12 -      Related party transactions:

The Company may be deemed to be controlled  by Harold C. Simmons.  See Note
1.  Corporations  that may be deemed to be controlled by or affiliated  with Mr.
Simmons sometimes engage in (a) intercorporate  transactions such as guarantees,
management and expense  sharing  arrangements,  shared fee  arrangements,  joint
ventures,  partnerships,  loans, options, advances of funds on open account, and
sales,  leases and  exchanges  of assets,  including  securities  issued by both
related  and  unrelated  parties  and  (b)  common  investment  and  acquisition
strategies,   business   combinations,    reorganizations,    recapitalizations,
securities  repurchases,  and  purchases and sales (and other  acquisitions  and
dispositions)  of  subsidiaries,   divisions  or  other  business  units,  which
transactions  have involved both related and unrelated parties and have included
transactions  which  resulted  in the  acquisition  by one  related  party  of a
publicly-held  minority equity  interest in another  related party.  The Company
continuously considers,  reviews and evaluates, and understands that Contran and
related entities consider, review and evaluate such transactions. Depending upon
the business,  tax and other  objectives then relevant,  it is possible that the
Company might be a party to one or more such transactions in the future.

It is the policy of the  Company  to engage in  transactions  with  related
parties  on terms,  in the  opinion of the  Company,  no less  favorable  to the
Company than could be obtained from unrelated parties.

Under the terms of various  Intercorporate Service Agreements ("ISAs") with
Contran,  Valhi and NL Industries,  Inc., a majority-owned  subsidiary of Valhi,
Contran, Valhi and NL have performed certain management, tax planning, financial
and  administrative  services for the Company on a fee basis over the past three
years.  Such fees are based upon estimates of time devoted to the affairs of the
Company by individual  Contran,  Valhi or NL employees and the  compensation  of
such persons.  Because of the large number of companies affiliated with Contran,
the Company believes it benefits from cost savings and economies of scale gained
by not having certain management, financial and administrative staffs duplicated
at each  entity,  thus  allowing  certain  individuals  to provide  services  to
multiple  companies  but  only be  compensated  by one  entity.  These  ISAs are
reviewed and approved by the applicable  independent  directors of the companies
that are parties to the agreement.  In addition,  certain  occupancy and related
office services are provided based upon square footage  occupied.  Fees pursuant
to  these  agreements  aggregated  $1,245,000  in 2001,  $1,744,000  in 2002 and
$2,138,000 in 2003.

F-25

Tall Pines Insurance  Company,  Valmont  Insurance Company and EWI RE, Inc.
provide for or broker certain insurance  policies for Contran and certain of its
subsidiaries and affiliates,  including the Company.  Tall Pines and Valmont are
wholly-owned  subsidiaries of Valhi, and EWI is a wholly-owned subsidiary of NL.
Prior to  January  2002,  an entity  controlled  by one of  Harold  C.  Simmons'
daughters  owned a majority of EWI, and Contran  owned the  remainder of EWI. In
January  2002,  NL  purchased  EWI from its  previous  owners.  Consistent  with
insurance industry  practices,  Tall Pines,  Valmont and EWI receive commissions
from the  insurance  and  reinsurance  underwriters  for the policies  that they
provide or broker.  The aggregate  premiums paid to Tall Pines,  Valmont and EWI
were $889,000 in 2001,  $1,094,000 in 2002 and $1,029,000 in 2003. These amounts
principally  included  payments for insurance and  reinsurance  premiums paid to
third parties,  but also included  commissions  paid to Tall Pines,  Valmont and
EWI.  In the  Company's  opinion,  the amounts  that the Company  paid for these
insurance  policies and the  allocation  among the Company and its affiliates of
relative  insurance premiums are reasonable and similar to those they could have
obtained  through  unrelated  insurance  companies  and/or brokers.  The Company
expects that these relationships with Tall Pines,  Valmont and EWI will continue
in 2004.

Contran and  certain of its  subsidiaries  and  affiliates,  including  the
Company, purchase certain of their insurance policies as a group, with the costs
of  the  jointly-owned   policies  being  apportioned  among  the  participating
companies.  With  respect to  certain  of such  policies,  it is  possible  that
unusually  large losses  incurred by one or more insureds  during a given policy
period could leave the other  participating  companies without adequate coverage
under that policy for the balance of the policy period. As a result, Contran and
certain of its subsidiaries and affiliates,  including the Company, have entered
into a loss sharing  agreement under which any uninsured loss is shared by those
entities  who have  submitted  claims  under the  relevant  policy.  The Company
believes  the  benefits in the form of reduced  premiums  and  broader  coverage
associated  with  the  group  coverage  for  such  policies  justifies  the risk
associated with the potential for any uninsured loss.

Note 13 -      Commitments and contingencies:

Legal proceedings.  The Company is involved,  from time to time, in various
contractual,  product liability,  patent (or intellectual property),  employment
and other claims and disputes incidental to its business.  The Company currently
believes that the disposition of all claims and disputes, individually or in the
aggregate,  if any,  should not have a material  adverse effect on the Company's
consolidated financial condition, results of operations or liquidity.

Environmental matters and litigation. The Company's operations are governed
by various federal, state, local and foreign environmental laws and regulations.
The Company's policy is to comply with environmental laws and regulations at all
of its plants and to continually strive to improve environmental  performance in
association with applicable industry initiatives.  The Company believes that its
operations  are  in  substantial  compliance  with  applicable  requirements  of
environmental   laws.  From  time  to  time,  the  Company  may  be  subject  to
environmental regulatory enforcement under various statutes, resolution of which
typically involves the establishment of compliance programs.

Income  taxes.  The Company is  undergoing  examinations  of certain of its
income tax returns,  and tax authorities  have or may propose tax  deficiencies.
The Company  believes that it has  adequately  provided  accruals for additional
income taxes and related interest expense which may ultimately  result from such
examinations and believes that the ultimate disposition of all such examinations
should  not  have  a  material  adverse  effect  on its  consolidated  financial
position, results of operations or liquidity.

F-26

Concentration of credit risk. The Company's  products are sold primarily in
North America and Europe to original  equipment  manufacturers.  The ten largest
customers  accounted for  approximately  36%, 30% and 38% of sales in 2001, 2002
and 2003, respectively,  with no single customer accounting for more than 10% of
sales.

Other.  Royalty expense was $672,000 in 2001, $708,000 in 2002 and $450,000
in 2003. Royalties relate principally to certain products manufactured in Canada
and sold in the United  States under the terms of a third-party  patent  license
agreement that expired during 2003.

Rent expense, principally for equipment, was $1,861,000 in 2001, $1,009,000
in 2002 and $792,000 in 2003. At December 31, 2003, future minimum rentals under
noncancellable  operating leases are approximately $851,000 in 2004, $632,000 in
2005, $417,000 in 2006, $172,000 in 2007 and none in 2008.

Firm purchase  commitments for capital  projects in process at December 31,
2003 approximated $.6 million.

Note 14 - Quarterly results of operations (unaudited):

Quarter ended
---------------------------------------------------
March 31       June 30      Sept. 30        Dec. 31
--------       -------      --------        -------
(In millions, except per share amounts)

2002:

Net sales                                                    $48.6          $51.0        $48.8         $47.7
Operating income (loss)                                        2.5            2.7          1.3           (.3)
Net income (loss)                                              1.3             .8           .2          (1.8)

Basic and diluted earnings (loss)
per share                                                   $ .09          $ .05        $ .02         $(.12)

2003:
Net sales                                                    $51.0          $49.7        $52.5         $54.3
Operating income (loss)                                        1.8             .9          (.3)          1.7
Net income (loss)                                               .6             .3          (.4)           .8

Basic and diluted earnings (loss)
per share                                                   $ .04          $ .02        $(.03)        $ .05

The sum of the  quarterly  per share  amounts  may not equal the annual per
share amounts due to relative changes in the  weighted-average  number of shares
used in the per share computations.

During the fourth  quarter of 2002,  the  Company  recorded  the  following
significant adjustments:

o    A $1.6 million pre-tax charge related to a re-tooling of the Company's
precision slide manufacturing facility in Byron Center, Michigan. $1.0
million of such  charge was  non-cash  in nature and is  reflected  in
other general  corporate  income  (expenses),  net, with the remainder
reflected in cost of goods sold.

o    A $1.9 million pre-tax charge, recorded as cost of goods sold, related
to  various   changes  in  estimates  with  respect  to  obsolete  and
slow-moving  inventory,  inventory overhead absorption rates and other
items.  Approximately $1.3 million of this charge related to the CompX
Waterloo segment, with the remaining $.6 million relating to the CompX
Security Products segment.

F-27

The aggregate effect of these fourth quarter 2002 adjustments was a pre-tax
charge of $3.5 million ($2.3 million,  or $.15 per diluted share,  net of income
taxes).

During  the third  quarter of 2003,  the  Company  recorded a $3.5  million
restructuring  charge as an  operating  expense as  discussed  in Note 5. In the
fourth  quarter  of 2003,  the  Company  reduced  the  amount  of the  charge by
approximately  $225,000 to the same line item on the  Statement  of  Operations,
resulting in a net charge of $3.3 million in 2003.

F-28

REPORT OF INDEPENDENT AUDITORS
ON FINANCIAL STATEMENT SCHEDULE

To the Stockholders and Board of Directors of CompX International Inc.:

Our audits of the  consolidated  financial  statements  referred  to in our
report dated February 23, 2004, appearing on page F-2 of this 2003 Annual Report
on Form  10-K of  CompX  International  Inc.,  also  included  an  audit  of the
financial  statement schedule listed in the index on page F-1 of this Form 10-K.
In our opinion,  this  financial  statement  schedule  presents  fairly,  in all
material  respects,  the  information set forth therein when read in conjunction
with the related consolidated financial statements.

PricewaterhouseCoopers LLP

Dallas, Texas
February 23, 2004

S-1

COMPX INTERNATIONAL INC. AND SUBSIDIARIES

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

(In thousands)

Additions
Balance at charged to                        Balance
beginning  costs and     Net      Currency   at end
Description                    of year    expenses  deductions translation of year
------------------                ---------  ---------- ---------- ----------- -------

Year ended December 31, 2001:

Allowance for doubtful accounts .......   $  487   $   636   $  (296)    $   14     $  841
======   =======   =======     ======     ======

Amortization of goodwill ..............   $5,065   $ 2,304   $  --       $  (75)    $7,294
======   =======   =======     ======     ======

Amortization of other intangible assets   $  785   $   229   $  --       $   (4)    $1,010
======   =======   =======     ======     ======

Year ended December 31, 2002:

Allowance for doubtful accounts .......   $  841   $   458   $  (541)    $   54     $  812
======   =======   =======     ======     ======

Amortization of goodwill ..............   $7,294   $  --     $  --       $  332     $7,626
======   =======   =======     ======     ======

Amortization of other intangible assets   $1,010   $   240   $  --       $   (1)    $1,249
======   =======   =======     ======     ======

Year ended December 31, 2003:

Allowance for doubtful accounts .......   $  812   $   257   $   (98)    $  104     $1,075
======   =======   =======     ======     ======

Amortization of goodwill ..............   $7,626   $  --     $  --       $  407     $8,033
======   =======   =======     ======     ======

Amortization of other intangible assets   $1,249   $   234   $  --       $   19     $1,502
======   =======   =======     ======     ======

S-2

INTERCORPORATE SERVICES AGREEMENT

BETWEEN

CONTRAN CORPORATION

AND

COMPX INTERNATIONAL INC.

Dated as of January 1, 2004

TABLE OF CONTENTS
Page

ARTICLE I.  AMENDS AND SUPERSEDES PRIOR AGREEMENT.........................1

ARTICLE II.  RETENTION OF CONTRAN.........................................1

Section 2.1.  Performance of Services............................1
Section 2.2.  Director Services Not Included.....................2
Section 2.3.  Outside Services...................................2
Section 2.4.  Disclaimer, Limited Liability; Indemnification.....2

ARTICLE III.  COMPENSATION................................................3

Section 3.1.  Compensation for Services..........................3
Section 3.2.  Out-of-Pocket Costs................................3

ARTICLE IV.  CONFIDENTIALITY..............................................3

Section 4.1.  Confidentiality....................................3

ARTICLE V.  MISCELLANEOUS.................................................3

Section 5.1.  Maintenance and Inspection of Records..............3
Section 5.2.  Notices............................................4
Section 5.3.  Term; Renewal......................................4
Section 5.4.  Independent Contractor.............................4
Section 5.5.  Force Majeure......................................4
Section 5.6.  Entire Agreement...................................5
Section 5.7.  Amendments.........................................5
Section 5.8.  Severability.......................................5
Section 5.9.  Counterparts.......................................5
Section 5.10.  Successors and Assigns............................5
Section 5.11.  Governing Law.....................................5
Section 5.12.  Submission to Jurisdiction; Service; Waivers......5
Section 5.13.  No Third-Party Beneficiaries......................6
Section 5.14.  Titles and Headings...............................6

INTERCORPORATE SERVICES AGREEMENT

This  Intercorporate  Services  Agreement  ("Agreement")  is  entered  into
effective  as of  January  1,  2004  (the  "Effective  Date"),  between  Contran
Corporation, a Delaware corporation ("Contran"), and CompX International Inc., a
Delaware corporation ("CompX")

Recitals

A. CompX is an indirectly held subsidiary of Contran.

B..CompX has and will have the need for executive,  management,  financial,
audit, accounting, tax, legal, insurance, risk management,  treasury, technical,
consulting,  administrative  and other services as required from time to time in
the ordinary course of CompX's business (collectively,  the "Services"), but has
determined  that it is not cost effective to obtain and separately  maintain the
infrastructure  associated with the Services,  particularly the costs associated
with  attracting  and  maintaining  on its  payroll  on a full time basis a full
complement of skilled employees.

C..Contran is able and willing to provide the Services to CompX,  and CompX
desires to engage Contran as an  independent  contractor to provide the Services
in accordance with the terms set forth in this Agreement.

Agreement

For  and in  consideration  of the  mutual  promises,  representations  and
covenants contained in this Agreement, the parties agree as follows.

ARTICLE I.
AMENDS AND SUPERSEDES PRIOR AGREEMENT

This  Agreement   amends  and  supersedes  in  its  entirety  that  certain
Intercorporate Services Agreement effective as of January 1, 2003 by and between
Contran and CompX.

ARTICLE II.
RETENTION OF CONTRAN

Section 2.1. Performance of Services.

(a) CompX hereby  engages and retains  Contran to perform the Services
and Contran  hereby  accepts and agrees to provide  such  Services to CompX
upon the terms and conditions set forth in this Agreement.  All Services to
be  provided by Contran  hereunder  shall be  performed  at the request and
under the  direction of CompX,  and Contran shall not have any power to act
independently  on behalf of CompX  other  than as  specifically  authorized
under this  Agreement or from time to time by CompX.  Contran shall provide
Services  in  connection  with  routine  functions  related to the  ongoing
ordinary course of CompX's  business.  The Services  rendered in connection
with the conduct of CompX's  business  will be on a scale  compared to that
existing on the  effective  date of this  Agreement,  adjusted for internal
corporate growth or contraction,  but not for major corporate  acquisitions
or divestitures,  and that adjustments may be required to the terms of this
Agreement in the event of such major corporate  acquisitions,  divestitures
or special projects.

(b) Contran shall  determine  the  corporate  facilities to be used in
rendering the Services and the individuals who will render such Services.

(c) Contran will use reasonable efforts to make the Services available
with  substantially the same degree of care as it employs in making similar
services available for its own operations.

(d) Those employees or agents of Contran who perform similar  services
for Contran or for other  affiliates of Contran,  or both, will perform the
Services.

(e) Nothing  herein  shall be deemed to restrict  either  party or its
directors,  officers, employees or agents from engaging in any business, or
from contracting with other parties, including,  without limitation,  other
affiliates of Contran, for similar or different services.

Section 2.2.  Director  Services Not Included.  The Services do not include
any  services  that  employees of Contran may provide to CompX in their roles as
members of CompX's  board of  directors  or any other  activity  related to such
board of directors.

Section 2.3. Outside Services.  CompX will continue to bear all other costs
required  for  outside  services  including,  but not  limited  to, the  outside
services of attorneys,  auditors,  trustees,  consultants,  transfer  agents and
registrars, and it is expressly understood that Contran assumes no liability for
any expenses or services other than those stated in this Article.

Section 2.4. Disclaimer, Limited Liability; Indemnification.

(a) Except as expressly provided elsewhere in this Agreement,  Contran
makes no express  or  implied  representations,  warranties  or  guarantees
relating to the  Services  or the quality or results of the  Services to be
performed under this Agreement.

(b) Contran,  its  directors,  officers,  employees,  stockholders  or
agents  shall  not be liable to CompX or any  third  party,  including  any
governmental agency, for any claims, demands, losses, liabilities, damages,
costs or expenses,  including  attorneys' and expert witness fees,  arising
from or in connection  with the Services,  other than those arising from or
in connection with the gross negligence or willful misconduct of Contran or
its directors,  officers, employees,  stockholders or agents (collectively,
"No Liability Claims").

(c) CompX assumes all liability  for, and agrees to defend,  indemnify
and hold Contran harmless from and against all No Liability  Claims.  CompX
assumes  all  liability  for,  and  agrees to  defend,  indemnify  and hold
Contran's directors,  officers, employees,  stockholders or agents harmless
from, No Liability Claims to the same extent that Contran could assume such
liability  for,  or defend,  indemnify  and hold  harmless,  such entity or
person.  CompX shall promptly  advance  expenses as incurred by Contran its
directors,  officers, employees,  stockholders or agents in connection with
CompX's obligations under this Section.

ARTICLE III.
COMPENSATION

Section 3.1. Compensation for Services.

(a) Contran and CompX shall agree on the aggregate  annual amount that
CompX shall pay Contran for the Services for a particular year.

(b) CompX  shall pay to Contran  one  fourth of the  annual  amount in
advance quarterly around the first business day of each quarter.

(c)  From  time to time  upon a  change  to the  annual  amount  for a
particular  year,  Contran or CompX,  as  applicable,  shall  promptly make
appropriate payments to the other party to reflect such change.

(d) All charges  from Contran to CompX are intended to be equal to the
actual cost of such expenses without premium or mark-up to Contran.

Section 3.2. Out-of-Pocket Costs. In addition to the fee paid to Contran by
CompX for the  Services,  CompX  will  promptly  pay to  Contran  the  amount of
out-of-pocket costs incurred by Contran in rendering such Services.

ARTICLE IV.
CONFIDENTIALITY

Section  4.1.  Confidentiality.  Each party  shall hold and shall cause its
directors,    officers,    employees,    agents,    consultants   and   advisors
("Representatives")  to hold in strict confidence all information concerning the
other party unless (i) such party is compelled to disclose such  information  by
judicial or administrative  process or, in the opinion of its counsel,  by other
requirements  of law or (ii) such  information  can be shown to have been (A) in
the public domain  through no fault of such party or (B) lawfully  acquired on a
non-confidential basis from other sources.  Notwithstanding the foregoing,  such
party may  disclose  such  information  to its  Representatives  so long as such
persons  are  informed  by  such  party  of  the  confidential  nature  of  such
information   and  are  directed  by  such  party  to  treat  such   information
confidentially.  If such  party or any of its  Representatives  becomes  legally
compelled to disclose any documents or information subject to this Section, such
party will  promptly  notify the other  party so that the other party may seek a
protective  order or other  remedy or waive such  party's  compliance  with this
Section.  If no such  protective  order or other  remedy is  obtained  or waiver
granted, such party will furnish only that portion of the information that it is
advised by counsel is legally required and will exercise its reasonable  efforts
to obtain adequate  assurance that confidential  treatment will be accorded such
information.  Such party agrees to be responsible for any breach of this Section
by it and its Representatives.

ARTICLE V.
MISCELLANEOUS

Section 5.1.  Maintenance  and  Inspection  of Records.  Contran shall keep
accurate books, accounts and records regarding the Services as may be reasonably
necessary  for purposes of this  Agreement.  CompX shall be permitted to inspect
such books, accounts and records at any reasonable time.

Section 5.2. Notices. All notices and other communications  hereunder shall
be in  writing,  and  shall be  delivered  by hand or mailed  by  registered  or
certified  mail (return  receipt  requested) or  transmitted by facsimile to the
parties at the following  addresses  (or at such other  addresses for a party as
shall be  specified  by like  notice)  and shall be deemed  given on the date on
which such notice is received:

If to Contran:             Contran Corporation.
Three Lincoln Centre
5430 LBJ Freeway, Suite 1700
Dallas, Texas   75240-2697
Attention:  General Counsel
Phone:  972.450.4251
Fax:  972.448.1445

If to CompX:               CompX International Inc.
Three Lincoln Centre
5430 LBJ Freeway, Suite 1700
Dallas, Texas   75240-2697
Attention:  General Counsel
Phone:  972.450.4251
Fax:  972.448.1445

Section  5.3.  Term;  Renewal.  The initial  term of this  Agreement  shall
commence as of the  Effective  Date and end on December 31,  2004,  but shall be
automatically renewed on a quarter-to-quarter  basis after the expiration of the
initial term. Either party may terminate this Agreement by giving written notice
of  termination  to the other party not less than thirty (30) days in advance of
the  first  day of each  successive  quarter.  In  addition,  in the  event of a
material default  hereunder by a party, the  non-defaulting  party may terminate
this  Agreement  upon  thirty  (30) days prior  written  notice if such  default
remains  uncured and is  continuing  for twenty  (20) days after  receipt by the
defaulting  party  of such  written  notice  of  intent  to  terminate.  A final
accounting  and  payment  by one  party  to the  other  of all  amounts  payable
hereunder  shall be made  pursuant to the terms hereof  within  thirty (30) days
following such termination.

Section  5.4.  Independent  Contractor.  Contran  shall  be an  independent
contractor and not an employee of, or partner or joint venturer with, CompX.

Section 5.5. Force Majeure.  No party shall be in default of this Agreement
or liable to the other  party for any  delay or  default  in  performance  where
occasioned by any cause of any kind or extent beyond its control,  including but
not limited to,  armed  conflict or economic  dislocation  resulting  therefrom;
embargoes;   shortages  of  labor,  raw  materials,   production  facilities  or
transportation;  labor difficulties;  civil disorders of any kind; action of any
civil or military authorities  (including,  priorities and allocations);  fires;
floods and accidents.  The dates on which the obligations of the party are to be
fulfilled shall be extended for a period equal to the time lost by reason of any
delay arising, directly or indirectly from:

(a) Any of the foregoing causes, or

(b) Inability of a party,  as a result of causes beyond its reasonable
control,  to obtain instruction or information from the other party in time
to perform its obligations by such dates.

Section  5.6.  Entire  Agreement.  This  Agreement  constitutes  the entire
understanding  between the parties with respect to the subject matter hereof and
all prior  agreements  or  understandings  shall be  deemed  merged  herein.  No
representations,  warranties and if  certifications,  express or implied,  shall
exist as between the parties except as stated herein.

Section 5.7.  Amendments.  No amendments,  waivers or modifications  hereof
shall be made or deemed to have been made  unless in  writing,  executed  by the
party to be bound thereby.

Section  5.8.  Severability.  If any  provision  in this  Agreement  or the
application  of such provision to any person or  circumstance  shall be invalid,
illegal or unenforceable,  the remainder of this Agreement or the application of
such provision to persons or circumstances  other than those to which it is held
invalid, illegal or unenforceable shall not be affected thereby.

Section 5.9. Counterparts.  This Agreement may be executed in any number of
counterparts,  each of which when so executed  shall be deemed to be an original
and all of which when taken together shall constitute this Agreement.

Section  5.10.   Successors  and  Assigns.  This  Agreement  shall  not  be
assignable,  in whole or in part,  directly or  indirectly,  by any party hereto
without the prior written consent of the other party hereto,  and any attempt to
assign any rights or  obligations  arising,  under this  Agreement  without such
consent shall be void.  This Agreement  shall be binding,  upon and inure to the
benefit of the parties  hereto and their  respective  successors  and  permitted
assigns.

Section  5.11.  Governing  Law.  This  Agreement  shall be  governed by and
construed in accordance  with the domestic  laws of the state of Texas,  without
giving effect to any choice of law or conflict of law provision or rule (whether
of  the  state  of  Texas  or any  other  jurisdiction)  that  would  cause  the
application of the laws of any jurisdiction other than the state of Texas.

Section 5.12. Submission to Jurisdiction; Service; Waivers. WITH RESPECT TO
ANY CLAIM ARISING OUT OF THIS AGREEMENT, EACH PARTY (A) IRREVOCABLY SUBMITS, FOR
ITSELF AND ITS  PROPERTY,  TO THE  JURISDICTION  OF THE FEDERAL OR STATE  COURTS
LOCATED IN DALLAS COUNTY,  TEXAS (B) AGREES THAT THE VENUE FOR ANY SUIT,  ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE EXCLUSIVE TO
SUCH COURTS, AND (C) IRREVOCABLY WAIVES ANY OBJECTION IT MAY HAVE AT ANY TIME TO
THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT BROUGHT IN ANY SUCH COURT,  IRREVOCABLY  WAIVES ANY CLAIM THAT
ANY SUCH SUIT,  ACTION OR PROCEEDING  BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT
IN AN  INCONVENIENT  FORUM AND FURTHER  IRREVOCABLY  WAIVES THE RIGHT TO OBJECT,
WITH RESPECT TO SUCH CLAIM, SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT
THAT  SUCH  COURT  DOES  NOT  HAVE  JURISDICTION  OVER  IT.  EACH  PARTY  HEREBY
IRREVOCABLY  CONSENTS  TO THE  SERVICE OF  PROCESS  IN ANY SUCH SUIT,  ACTION OR
PROCEEDING  IN ANY OF THE  AFORESAID  COURTS  BY THE  MAILING  OF COPIES OF SUCH
PROCESS TO THE PARTY, BY CERTIFIED OR REGISTERED  MAIL AT THE ADDRESS  SPECIFIED
IN SECTION 5.2.

Section 5.13. No  Third-Party  Beneficiaries.  This Agreement is solely for
the benefit of the parties  hereto and should not be deemed to confer upon third
parties any remedy, claim,  liability,  reimbursement,  claim of action or other
right in excess of those existing without reference to this Agreement.

Section 5.14.  Titles and Headings.  Titles and headings to sections herein
are inserted for convenience of reference only and are not intended to be a part
of or to affect the meaning or interpretation of this Agreement.

Executed as of the Effective Date.

CONTRAN CORPORATION

By:  /s/Bobby D. O'Brien
---------------------------------------------
Bobby D. O'Brien, Vice President

COMPX INTERNATIONAL INC.

By:   /s/David A. Bowers
---------------------------------------------
David A. Bowers,
Vice Chairman of the Board,
President and Chief Executive Officer

EXECUTION COPY                                                     CONFIDENTIAL

AGREEMENT REGARDING SHARED INSURANCE
------------------------------------

This Agreement Regarding Shared Insurance  (hereinafter the "Agreement") is made
as of the 30th day of October 2003, by and between

CompX International Inc. ("CompX")
Contran Corporation ("Contran");
Keystone Consolidated Industries, Inc. ("Keystone");
Kronos Worldwide, Inc. ("KI")
NL Industries, Inc. ("NL");
Titanium Metals Corp. ("Titanium Metals");
and
Valhi, Inc. ("Valhi");

(For  convenience,  each of the above entities  and/or its  subsidiaries  may be
referred  to as a  "Party,"  and  collectively  they may be  referred  to as the
"Parties").

WITNESSETH THAT:

WHEREAS,  the Parties are affiliated  companies that have been,  are, and in the
future may be insured under a number of shared  insurance  policies that provide
shared limits of available insurance; and

WHEREAS,  although as of the date of this  Agreement the Parties  separately and
collectively  never  have  exhausted  the  total  limits of  insurance  coverage
available under any shared insurance agreement,  the Parties wish to ensure that
claims asserted under any of the shared insurance policies by any one Party will
not  unreasonably  deprive other  Parties of insurance  that may be available to
them.

AGREEMENTS:

NOW,  THEREFORE,  in  full  consideration  of the  foregoing  and of the  mutual
agreements  herein  contained,  and intending to be legally  bound,  the Parties
agree as follows:

1. Definitions

The following  definitions  will apply to the listed terms  wherever those terms
appear  throughout  the  Agreement  as well as in any  exhibits  or  attachments
thereto. Moreover, each defined term stated in a singular form shall include the
plural form,  each defined term stated in plural form shall include the singular
form, and each defined term stated in the masculine form or in the feminine form
shall include the other.

A.    "Shared  Insurance  Policy"  shall  mean  any  one or more of the
insurance  policies listed on Exhibit "A" hereto,  as well as any
past, present or future insurance policies that provide insurance
coverage  to all of the Parties to this  Agreement  and where the
policy  provides for an aggregate limit for all claims during the
policy period.

B.    "Covered Claim" shall mean any claim for insurance  coverage that
any Party  may  assert at any time  under  any  Shared  Insurance
Policy  that is  covered  in whole or in part under the terms and
conditions of the Shared  Insurance  Policy in question,  or that
would be covered  but for the fact that all  available  limits of
insurance  coverage under the Shared Insurance Policy in question
already  have been  exhausted  by another  claim or claims of any
Party.

C.    "Reimbursed Covered Claim" shall mean any Covered Claim for which
any Party  actually  has  received a total or  partial  insurance
coverage under any Shared Insurance Policy.

D.    "Remaining Covered Claim" shall mean any Covered Claim or portion
of a Covered Claim of any Party for which the available limits of
insurance  coverage under the Shared Insurance Policy in question
already  have been  exhausted by a  Reimbursed  Covered  Claim or
Reimbursed Covered Claims of any Party or Parties.

2. Agreement

Whenever the available  limits of insurance  under any Shared  Insurance  Policy
have been exhausted by a Reimbursed  Covered Claim or Reimbursed  Covered Claims
submitted by one or more of the Parties, this Agreement will provide a mechanism
by which the  Parties  will share  financial  responsibility  for all  Remaining
Covered Claims.

Financial responsibility for each Remaining Covered Claim shall be divided among
those  Parties  with Covered  Claims for that policy.  Each Party other than the
holder of a particular Remaining Covered Claim shall indemnify and reimburse the
holder of that  Remaining  Covered  Claim  for a  percentage  of that  Remaining
Covered  Claim equal to the  percentage  of Covered  Claims of the  Indemnifying
Party bears to the sum of all Parties' Covered Claims for the particular policy.

Any  indemnification  obligation required by this Agreement shall be paid within
60 days after a Party requests in writing  indemnification from another Party or
Parties  with  respect  to a  Remaining  Covered  Claim  and  provides  a  brief
description of the Remaining  Covered Claim,  as well as  identification  of the
Shared  Insurance  Policy  that would,  but for  exhaustion  of limits,  provide
coverage for the  Remaining  Covered  Claim.  If the insurer  issuing the Shared
Insurance  Policy in  question  has taken the  position  that the claim would be
covered and payable but for prior  exhaustion  of available  limits of coverage,
the claim  conclusively  will be  considered  by the  Parties to be a  Remaining
Covered Claim.  If the insurer issuing the Shared  Insurance  Policy in question
has not or will not  expressly  state that a claim  would be covered and payable
but for  exhaustion,  the Parties will attempt in good faith to agree whether or
not the claim is a Remaining  Covered Claim. If the Parties cannot agree whether
a claim is a Remaining  Covered Claim,  the question will be settled pursuant to
the "Dispute Resolution" provisions of this Agreement.

3. Confidentiality

The  Parties  agree that all  matters  relating  to the terms,  negotiation  and
implementation of this Agreement,  including documents and information exchanged
during  negotiations or relating to indemnification  obligations and claims made
hereunder,  shall be confidential and are not to be disclosed except as required
by law or regulation or by order of court or by  agreement,  in writing,  of the
Parties,  except  that,  provided  recipients  agree  to keep  such  information
confidential, the Agreement may be disclosed to any officer, director, or parent
corporation  of any Party and any  outside  counsel,  consultants,  auditors  or
accountants of any Party.

In the event a private  litigant,  by way of  document  request,  interrogatory,
subpoena,  or questioning at deposition or trial,  attempts to compel disclosure
of anything protected by this Section,  the Party from whom disclosure is sought
shall  decline to provide  the  requested  information  on the ground  that this
Agreement prevents such disclosure.  In the event such private litigant seeks an
Order from any court or governmental  body to compel such disclosure,  or in the
event that a court,  government  official,  or governmental body (other than the
Inland  Revenue or Internal  Revenue  Service or other  similar  U.S. or foreign
governmental  taxation  authorities) requests or requires disclosure of anything
protected  by this  Agreement,  the Party from whom  disclosure  is sought shall
promptly give written notice by facsimile or  hand-delivery  to the other Party,
and shall  promptly  provide copies of all notice  papers,  orders,  requests or
other  documents in order to allow each Party to take such  protective  steps as
may be appropriate in order to preserve the confidentiality of such information.
Notice  shall be made under this  Paragraph  to the persons  identified  in this
Agreement.

4. No Modification

No change or  modification of this Agreement shall be valid unless it is made in
writing and signed by each of the Parties.

5. Execution

There will be two signed  originals of this  Agreement.  This  Agreement  may be
executed  and  delivered  in  counterparts,  each of which when so executed  and
delivered  shall be deemed an original and shall  together  constitute an entire
Agreement.  This  Agreement may be executed and delivered by facsimile,  each of
which when so executed and delivered shall be deemed an original.

6. Governing Law

This  Agreement  shall be governed by and shall be construed in accordance  with
the laws of the State of Texas  without  giving  effect to any  choice of law or
conflict of law provision or rule.

7. Dispute Resolution

A.    The  Parties  agree to use their best  efforts to resolve  claims
relating  to this  Agreement  prior  to  instituting  arbitration
proceedings  as set forth  below.  In the event such  efforts are
unsuccessful,  the Parties  agree that any  controversy  or claim
arising  out of or  relating  to  this  Agreement  or any  breach
thereof,  including without  limitation,  any disputes concerning
the  calculation of any settlement  payment under this Agreement,
shall be  submitted  to final and  binding  arbitration  before a
single  arbitrator,  who shall be a former  judge or an  attorney
licensed  to  practice  law in  Texas  with at least  ten  years'
experience,  and whom the Parties  shall  choose.  If the Parties
cannot agree on the arbitrator,  the arbitrator shall be selected
in  accordance  with  the  Commercial  Arbitration  Rules  of the
American  Arbitration  Association that are in effect at the time
the dispute is submitted to arbitration.

B.    To the extent the  Parties  are unable to agree,  the  commercial
rules and procedures of the American Arbitration Association that
were in effect on the date of execution of this  Agreement  shall
apply to the arbitration. Texas law shall govern any arbitration.

C.    Any arbitration conducted in accordance with this Agreement shall
be conducted  in Texas or such other  location as the Parties may
agree.  The Parties shall abide by the  arbitrator's  award,  and
judgment  on that award may be  entered  by a court of  competent
jurisdiction in Texas , in accordance with Texas law.

8. Notices

Unless  another  person is  designated,  in  writing,  for  receipt  of  notices
hereunder,  notices to the  respective  Parties  shall be sent to the  following
person by facsimile transmission or overnight courier:

CompX International Inc.:                  Darryl R. Halbert
Three Lincoln Centre
5430 LBJ Freeway
Suite 1700
Dallas, Texas  75240
(972) 233-1700 phone
(972) 448-1419 fax

Contran Corporation:                       J. Mark Hollingsworth
Three Lincoln Centre
5430 LBJ Freeway
Suite 1700
Dallas, Texas  75240
(972) 233-1700 phone
(972) 448-1445 fax

Keystone Consolidated Industries, Inc.     Bert D. Downing, Jr.
Three Lincoln Centre
5430 LBJ Freeway
Suite 1700
Dallas, Texas  75240
(972) 233-1700 phone
(972) 448-1408 fax

Kronos Worldwide, Inc.                     Robert D. Graham
Three Lincoln Centre
5430 LBJ Freeway
Suite 1700
Dallas, Texas  75240
(972) 233-1700 phone
(972) 448-1445 fax

NL Industries, Inc.                        Robert D. Graham
Three Lincoln Centre
5430 LBJ Freeway
Suite 1700
Dallas, Texas  75240
(972) 233-1700 phone
(972) 448-1445 fax

Titanium Metals Corporation:               Joan Prusse
1999 Broadway
Suite 4300
Denver, Colorado  80202
303-296-5600 phone
303-291-1990 fax

Valhi, Inc.:                               J. Mark Hollingsworth
Three Lincoln Centre
5430 LBJ Freeway
Suite 1700
Dallas, Texas  75240
(972) 233-1700 phone
(972) 448-1445 fax

9. Integration

This Agreement constitutes the entire Agreement between the Parties with respect
to the subject matter hereof,  and  supersedes all  discussions,  agreements and
understandings, both written and oral, among the Parties with respect thereto.

10. Severability

This Agreement shall be binding upon and inure to the benefit of the Parties
hereto. In case any one or more of the provisions contained in this Agreement
shall be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired hereby.

11. Term

This  Agreement  may be  terminated  by each of the Parties  upon one (1) year's
written notice to the other Parties.

12. Assignment

This  Agreement  shall not be  assignable by any Party without the prior written
consent  of the other  except  that any  successor  to the Party may  assume the
rights  and  obligations  of the Party  under  this  Agreement.  Nothing in this
Agreement,  expressed or implied,  is intended to confer upon any person,  other
than the Parties hereto and their successors and assigns, any rights or remedies
under or by reason of this Agreement.

IN WITNESS  WHEREOF,  the Parties  have  executed  this  Agreement by their duly
authorized representatives.

CompX International Inc.

By: /s/ Darryl Halbert

Its:    Chief Financial Officer

Date:   October 31, 2003

Contran Corporation

By:     /s/ J. Mark Hollingsworth

Its:    Vice President, General Counsel

Date:   November 10, 2003

Keystone Consolidated Industries, Inc.

By:     /s/ Bert Downing, Jr.

Its:    Vice President, CFO

Date:   October 28, 2003

Kronos Worldwide, Inc.

By:     /s/ Robert D. Graham

Its:    Vice President, General Counsel

Date:   November 7, 2003

NL Industries, Inc.

By:     /s/ Robert D. Graham

Its:    Vice President, General Counsel

Date:   November 7, 2003

Titanium Metals Corporation.

By:    /s/ Joan H. Prusse

Its:   Vice President, General Counsel

Date:  November 7, 2003

Valhi, Inc.

By:     /s/ J. Mark Hollingsworth

Its:    Vice President, General Counsel

Date:   November 10, 2003

EXHIBIT A

Shared Insurance Policies

1. Directors and Officers Liability (Primary and Excess)

2. Fiduciary liability

3. General Liability (U.S)

4. General Liability (Canada)

5. Excess Liability

6. Property

7. Deductible Buydown

EXHIBIT 21.1     SUBSIDIARIES OF THE REGISTRANT

% of Voting
Securities
Jurisdiction of        Held at December
Incorporation or              31,
Name of Corporation                                                          Organization               2003
-----------------------------------                                        ----------------          ------------

Waterloo Furniture Components Limited                                  Canada                             100

CompX Security Products Inc.                                           Delaware                           100

CompX Europe B.V.                                                      the Netherlands                    100
Thomas Regout Holding B.V.                                           the Netherlands                    100
Thomas Regout Nederland B.V.                                       the Netherlands                    100
Thomas Regout B.V.                                                 the Netherlands                    100
Thomas Regout International B.V.                                   the Netherlands                    100

Thomas Regout U.S.A., Inc.                                             Michigan                           100

CompX Asia Holding Corporation                                         Malaysia                           100
Dynaslide Corporation                                                Taiwan                             100
CompX (H.K.) Corp.                                                 British Virgin                     100
Islands
CompX SFC, Inc.                                                        Delaware                           100

Exhibit 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the (i) Registration
Statement  (Form S-8 No.  333-47539)  and related  Prospectus  pertaining to the
CompX  International  Inc. 1997 Long-Term  Incentive Plan and (ii)  Registration
Statement  (Form S-8 No.  333-56163)  and related  Prospectus  pertaining to the
CompX  Contributory  Retirement Plan of CompX  International  Inc. of our report
dated  February 23, 2004 relating to the financial  statements  which appears in
the Annual Report to  Shareholders,  which is incorporated in this Annual Report
on Form 10-K.  We also consent to the  incorporation  by reference of our report
dated  February 23, 2004 relating to the  financial  statement  schedule,  which
appears in this Form 10-K.

PricewaterhouseCoopers LLP

Dallas, Texas
March 3, 2004

Exhibit 31.1

CERTIFICATION

I,  David A.  Bowers,  the Vice  Chairman  of the  Board,  President  and  Chief
Executive Officer of CompX International Inc., certify that:

1)   I have  reviewed  this  annual  report on Form 10-K of CompX  International
Inc.;

2)   Based on my knowledge, this report does not contain any untrue statement of
a material  fact or omit to state a  material  fact  necessary  to make the
statements made, in light of the circumstances  under which such statements
were made,  not  misleading  with  respect  to the  period  covered by this
report;

3)   Based on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in  this  report,  fairly  present  in all  material
respects the financial  condition,  results of operations and cash flows of
the registrant as of, and for, the periods presented in this report;

4)   The  registrant's  other  certifying  officer  and  I are  responsible  for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules  13a-15(e) and 15d - 15(e)) for the registrant and we
have:

a)   Designed  such  disclosure  controls  and  procedures,  or caused such
disclosure   controls  and   procedures  to  be  designed   under  our
supervision,  to ensure  that  material  information  relating  to the
registrant,  including its consolidated subsidiaries, is made known to
us by others within those entities,  particularly during the period in
which this report is being prepared; 

b)   Evaluated the  effectiveness of the registrant's  disclosure  controls
and procedures and presented in this report our conclusions  about the
effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and

c)   Disclosed  in this  report  any  change in the  registrant's  internal
control over financial reporting that occurred during the registrant's
most recent fiscal quarter (the registrant's  fourth fiscal quarter in
the case of an annual  report)  that has  materially  affected,  or is
reasonably  likely to materially  affect,  the  registrant's  internal
control over financial reporting; and

5)   The registrant's  other certifying  officer and I have disclosed,  based on
our most recent evaluation of internal control over financial reporting, to
the registrant's  auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent function):

a)   All  significant  deficiencies  in the design or operation of internal
control  over  financial  reporting  which  are  reasonably  likely to
adversely  affect  the  registrant's   ability  to  record,   process,
summarize and report financial information;  and 
b)   Any fraud, whether or not material,  that involves management or other
employees who have a  significant  role in the  registrant's  internal
control over financial reporting.

Date:  March 3, 2004

/s/David A. Bowers
-------------------------------------
David A. Bowers
Vice Chairman of the Board, President
and Chief Executive Officer

Exhibit 31.2

CERTIFICATION

I, Darryl R. Halbert, the Vice President, Chief Financial Officer and Controller
of CompX International Inc., certify that:

1)   I have  reviewed  this  annual  report on Form 10-K of CompX  International
Inc.;

2)   Based on my knowledge, this report does not contain any untrue statement of
a material  fact or omit to state a  material  fact  necessary  to make the
statements made, in light of the circumstances  under which such statements
were made,  not  misleading  with  respect  to the  period  covered by this
report;

3)   Based on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in  this  report,  fairly  present  in all  material
respects the financial  condition,  results of operations and cash flows of
the registrant as of, and for, the periods presented in this report;

4)   The  registrant's  other  certifying  officer  and  I are  responsible  for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules  13a-15(e) and  15d-15(e))  for the registrant and we
have:

a)   Designed  such  disclosure  controls  and  procedures,  or caused such
disclosure   controls  and   procedures  to  be  designed   under  our
supervision,  to ensure  that  material  information  relating  to the
registrant,  including its consolidated subsidiaries, is made known to
us by others within those entities,  particularly during the period in
which this report is being prepared;
b)   Evaluated the  effectiveness of the registrant's  disclosure  controls
and procedures and presented in this report our conclusions  about the
effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and
c)   Disclosed  in this  report  any  change in the  registrant's  internal
control over financial reporting that occurred during the registrant's
most recent fiscal quarter (the registrant's  fourth fiscal quarter in
the case of an annual  report)  that has  materially  affected,  or is
reasonably  likely to materially  affect,  the  registrant's  internal
control over financial reporting; and

5)   The registrant's  other certifying  officer and I have disclosed,  based on
our most recent evaluation of internal control over financial reporting, to
the registrant's  auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent function):

a)   All  significant  deficiencies  in the design or operation of internal
control over financial  reporting which are reasonably likely to could
adversely  affect  the  registrant's   ability  to  record,   process,
summarize and report financial information; and

b)   Any fraud, whether or not material,  that involves management or other
employees who have a  significant  role in the  registrant's  internal
control over financial reporting.

Date:  March 3, 2004

/s/Darryl R. Halbert
---------------------------------------
Darryl R. Halbert
Vice President, Chief Financial Officer
and Controller

Exhibit 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of CompX  International  Inc. (the Company)
on Form  10-K  for the  period  ending  December  31,  2003 as  filed  with  the
Securities and Exchange  Commission on the date hereof (the Report), I, David A.
Bowers, Vice Chairman of the Board, President and Chief Executive Officer of the
Company, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906
of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully  complies  with the  requirements  of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

(2)  The  information  contained  in the  Report  fairly  presents,  in all
material  respects,  the  financial  condition  and result of  operations of the
Company.

/s/David A. Bowers
--------------------------
David A. Bowers
Vice Chairman of the Board, President and Chief Executive Officer
March 3, 2004

Note: The certification  the registrant  furnishes in this exhibit is not deemed
"filed" for purposes of Section 18 of the  Securities  Exchange Act of 1934,  as
amended,  or otherwise subject to the liabilities of that Section.  Registration
Statements or other documents filed with the Securities and Exchange  Commission
shall not incorporate this exhibit by reference,  except as otherwise  expressly
stated in such filing.

Exhibit 32.2

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of CompX  International  Inc. (the Company)
on Form  10-K  for the  period  ending  December  31,  2003 as  filed  with  the
Securities and Exchange Commission on the date hereof (the Report), I, Darryl R.
Halbert, Vice President,  Chief Financial Officer and Controller of the Company,
certify,  pursuant to 18 U.S.C.  ss.1350,  as adopted  pursuant to ss.906 of the
Sarbanes-Oxley Act of 2002, that:

(1) The Report fully  complies  with the  requirements  of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

(2)  The  information  contained  in the  Report  fairly  presents,  in all
material  respects,  the  financial  condition  and result of  operations of the
Company.

/s/Darryl R. Halbert
---------------------------------------
Darryl R. Halbert
Vice President, Chief Financial Officer
and Controller
March 3, 2004

Note: The certification  the registrant  furnishes in this exhibit is not deemed
"filed" for purposes of Section 18 of the  Securities  Exchange Act of 1934,  as
amended,  or otherwise subject to the liabilities of that Section.  Registration
Statements or other documents filed with the Securities and Exchange  Commission
shall not incorporate this exhibit by reference,  except as otherwise  expressly
stated in such filing.