Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - OM GROUP INC | d516781d8k.htm |
| EX-99.1 - EX-99.1 - OM GROUP INC | d516781dex991.htm |
Exhibit 99.2
OM Group, Inc.
Proforma Condensed Consolidated Balance Sheet
As of December 31, 2012
(Unaudited)
| Disposition of | Proforma | Proforma | ||||||||||||||
| (in thousands) | Dec 31, 2012 | AM (1) | Adjustments (2) | Dec 31, 2012 | ||||||||||||
| ASSETS |
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| Current assets |
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| Cash and cash equivalents |
$ | 227,612 | (11,573 | ) | — | A | 216,039 | |||||||||
| Restricted cash on deposit |
22,793 | (22,793 | ) | — | — | |||||||||||
| Accounts receivable, less allowance of $4,971 in 2012 |
174,613 | (37,248 | ) | — | 137,365 | |||||||||||
| Inventories |
463,093 | (189,222 | ) | — | 273,871 | |||||||||||
| Refundable and prepaid income taxes |
3,207 | (4,697 | ) | — | (1,490 | ) | ||||||||||
| Other current assets |
48,258 | (21,174 | ) | — | 27,084 | |||||||||||
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| Total current assets |
939,576 | (286,708 | ) | — | 652,868 | |||||||||||
| Property, plant and equipment, net |
496,755 | (141,335 | ) | — | 355,420 | |||||||||||
| Goodwill |
543,269 | (103,326 | ) | — | 439,943 | |||||||||||
| Intangible assets, net |
429,672 | (621 | ) | — | 429,051 | |||||||||||
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Notes receivable from joint venture partner, |
16,015 | — | (16,015 | ) B | — | |||||||||||
| Other non-current assets |
74,140 | (5,817 | ) | (10,680 | ) C | 57,643 | ||||||||||
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| Total assets |
$ | 2,499,427 | (537,806 | ) | (26,695 | ) | 1,934,926 | |||||||||
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| LIABILITIES AND STOCKHOLDERS’ EQUITY |
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| Current liabilities |
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| Current portion of long-term debt |
$ | 13,309 | — | — | 13,309 | |||||||||||
| Accounts payable |
128,381 | (51,388 | ) | — | 76,993 | |||||||||||
| Liability related to joint venture partner injunction |
22,793 | (22,793 | ) | — | — | |||||||||||
| Accrued income taxes |
23,913 | (796 | ) | — | 23,117 | |||||||||||
| Accrued employee costs |
41,762 | (8,828 | ) | — | 32,934 | |||||||||||
| Deferred income taxes |
4,724 | — | — | 4,724 | ||||||||||||
| Purchase price of VAC payable to seller |
75,351 | — | — | 75,351 | ||||||||||||
| Other current liabilities |
69,012 | (3,750 | ) | — | 65,262 | |||||||||||
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| Total current liabilities |
379,245 | (87,555 | ) | — | 291,690 | |||||||||||
| Long-term debt |
454,054 | — | (342,153 | ) A | 111,901 | |||||||||||
| Deferred income taxes |
121,451 | (9,574 | ) | — | 111,877 | |||||||||||
| Pension liabilities |
233,823 | — | — | 233,823 | ||||||||||||
| Purchase price of VAC payable to seller |
11,259 | — | — | 11,259 | ||||||||||||
| Other non-current liabilities |
55,446 | (5,555 | ) | — | 49,891 | |||||||||||
| Total OM Group, Inc. stockholders’ equity |
1,206,710 | (397,683 | ) | 315,458 | D | 1,124,485 | ||||||||||
| Noncontrolling interests |
37,439 | (37,439 | ) | — | (0 | ) | ||||||||||
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| Total liabilities and equity |
$ | 2,499,427 | $ | (537,806 | ) | $ | (26,695 | ) | $ | 1,934,926 | ||||||
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OM Group, Inc.
Proforma Condensed Statement of Consolidated Operations
Year Ended December 31, 2012
(Unaudited)
| Disposition of | Proforma | Proforma | ||||||||||||||
| (in thousands, except per share data) | 2012 | AM (3) | Adjustments (4) | 2012 | ||||||||||||
| Net sales |
$ | 1,637,791 | (447,050 | ) | 143,391 | 1,334,132 | ||||||||||
| Cost of goods sold |
1,381,441 | (408,172 | ) | 145,510 | 1,118,779 | |||||||||||
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| Gross profit |
256,350 | (38,879 | ) | (2,119 | ) E | 215,353 | ||||||||||
| Selling, general and administrative expenses |
260,519 | (32,452 | ) | — | 228,067 | |||||||||||
| Gain on sale of property |
(2,857 | ) | — | — | (2,857 | ) | ||||||||||
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| Operating profit (loss) |
(1,312 | ) | (6,427 | ) | (2,119 | ) | (9,857 | ) | ||||||||
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| Total other income (expense) |
(47,137 | ) | (150 | ) | 22,052 | F | (25,235 | ) | ||||||||
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| Income (loss) from continuing operations before income tax expense |
(48,449 | ) | (6,576 | ) | 19,933 | (35,092 | ) | |||||||||
| Income tax (expense) benefit |
2,771 | 14,936 | — | 17,707 | ||||||||||||
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| Income (loss) from continuing operations, net of tax |
(45,678 | ) | 8,360 | 19,933 | (17,386 | ) | ||||||||||
| Income (loss) from discontinued operations, net of tax |
(266 | ) | — | — | (266 | ) | ||||||||||
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| Consolidated net income (loss) |
(45,944 | ) | 8,360 | 19,933 | (17,652 | ) | ||||||||||
| Net (income) loss attributable to noncontrolling interests |
7,063 | (7,063 | ) | — | — | |||||||||||
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| Net income (loss) attributable to OM Group, Inc. common stockholders |
$ | (38,881 | ) | $ | 1,297 | $ | 19,933 | $ | (17,652 | ) | ||||||
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| Earnings per common share — basic: |
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| Income (loss) from continuing operations attributable to OM Group, Inc. common stockholders |
$ | (1.21 | ) | 0.04 | 0.63 | (0.54 | ) | |||||||||
| Income from discontinued operations attributable to OM Group, Inc. common stockholders |
(0.01 | ) | — | — | (0.01 | ) | ||||||||||
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| Net income (loss) attributable to OM Group, Inc. common stockholders |
$ | (1.22 | ) | $ | 0.04 | $ | 0.63 | $ | (0.55 | ) | ||||||
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| Weighted average shares outstanding |
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| Basic |
31,885 | — | — | 31,885 | ||||||||||||
| Assuming dilution |
31,885 | — | — | 31,885 | ||||||||||||
| Amounts attributable to OM Group, Inc. common stockholders: |
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| Income (loss) from continuing operations, net of tax |
$ | (38,615 | ) | $ | 1,297 | $ | 19,933 | $ | (17,386 | ) | ||||||
| Income (loss) from discontinued operations, net of tax |
(266 | ) | — | — | (266 | ) | ||||||||||
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| Net income (loss) |
$ | (38,881 | ) | $ | 1,297 | $ | 19,933 | $ | (17,652 | ) | ||||||
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OM Group, Inc
Notes to Proforma Condensed Consolidated Financial Statements
(Unaudited)
| (1) | Elimination of the Advanced Materials segment assets and liabilities from OM Group’s historical net assets as a result of the sale of its cobalt-based business and the transfer of its equity interest in DRC-based joint venture, GTL. |
| (2) | A) Net cash proceeds as follows used to make required debt prepayment: |
| Cash proceeds from sale |
336,600 | |||
| Transaction costs |
(9,800 | ) | ||
| Estimated working capital adjustment (i) |
15,353 | |||
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| Net cash proceeds |
342,153 | |||
| Less: Required debt prepayment |
(342,153 | ) | ||
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| Net change in cash |
— |
| (i) | Net cash proceeds will be affected by the final working capital adjustment. |
| B) | Reserve for notes due from joint venture partner as a result of the transaction |
| C) | Write-off of deferred financing fees related to required debt prepayments made with net cash proceeds |
| D) | Calculation of estimated loss on disposition (i): |
| Net cash proceeds from sale |
342,153 | |||
| Net assets of Advanced Materials segment |
(397,683 | ) | ||
| Reserve for notes due from joint venture partner |
(16,015 | ) | ||
| Write-off of deferred financing fees |
(10,680 | ) | ||
| Valuation of potential future cash consideration (ii) |
— | |||
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| Estimated net loss on disposition |
(82,225 | ) |
| (i) | The actual loss will be determined as of the closing date, March 29, 2013, and could be materially different than the estimate. |
| (ii) | Based on current cobalt prices and volumes, the Company does not believe that the revenue targets on which the potential future cash consideration is based are probable of being met. |
| (3) | Elimination of the Advanced Materials segment revenues and expenses from OM Group’s historical results as a result of the sale of its cobalt-based business and the transfer of its equity interest in DRC-based joint venture. |
| (4) | Reflects other effects of the disposition including: E) a minimal net loss due to our role as i) intermediary for the ongoing supply agreement between GTL and the Kokkola refinery primarily in back-to-back arrangements for a period of at least two years and the obligation to pay certain royalties and taxes on by-product exports, and as ii) the U.S. distributor for refined cobalt products in primarily back-to-back arrangements for a period of one year (actual results could be materially different than these estimates), and F) interest savings on debt prepayments required to be made with net cash proceeds at an estimated interest rate of 5.75% and lower amortization of deferred financing fees written off due to the prepayment of debt. |