Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K 10-7-2013 - CTS CORP | form8k.htm |
| EX-99.1 - EXHIBIT 99.1 10-7-2013 - CTS CORP | exhibit99_1.htm |
|
CTS CORPORATION AND SUBSIDIARIES
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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF (LOSS) / EARNINGS
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SIX MONTHS ENDED JUNE 30, 2013
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(In thousands, except per share amounts)
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Historical (1)
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EMS (2)
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Pro Forma Adjustments
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Pro Forma CTS
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Net sales
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$ | 301,073 | $ | 97,630 | $ | - | $ | 203,443 | ||||||||
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Costs and expenses:
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Cost of goods sold
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234,404 | 90,147 | - | 144,257 | ||||||||||||
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Insurance recovery for business interruption - casualties
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- | - | - | - | ||||||||||||
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Selling, general and administrative expenses
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42,156 | 7,323 | - | 34,833 | ||||||||||||
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Research and development expenses
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12,023 | - | - | 12,023 | ||||||||||||
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Insurance recovery for property damage - casualties
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- | - | - | - | ||||||||||||
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Restructuring and impairment charge
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7,802 | 596 | - | 7,206 | ||||||||||||
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Gain on sale-leaseback
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- | - | - | - | ||||||||||||
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Operating earnings/(loss)
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4,688 | (436 | ) | - | 5,124 | |||||||||||
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Other (expense)/income:
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Interest expense, net
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(1,135 | ) | (30 | ) | - | (1,105 | ) | |||||||||
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Other (expense)/income
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(12 | ) | 97 | - | (109 | ) | ||||||||||
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Total other (expense)/income
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(1,147 | ) | 67 | - | (1,214 | ) | ||||||||||
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Earnings/(loss) before income taxes
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3,541 | (369 | ) | - | 3,910 | |||||||||||
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Income tax expense
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11,308 | 692 | - | 10,616 | ||||||||||||
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Net (loss)/earnings
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$ | (7,767 | ) | $ | (1,061 | ) | $ | - | $ | (6,706 | ) | |||||
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Net (loss) / earnings per share:
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Basic
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$ | (0.23 | ) | $ | (0.20 | ) | ||||||||||
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Diluted
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$ | (0.23 | ) | $ | (0.20 | ) | ||||||||||
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Average common shares outstanding:
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Basic
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33,589 | 33,589 | ||||||||||||||
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Diluted
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33,589 | 33,589 | ||||||||||||||
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(1) As reported in CTS Corporation and Subsidiaries unaudited financial statements contained in its Quarterly Report on Form 10-Q for the Six Months Ended June 30, 2013.
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(2) Derived from EMS Segment reported numbers contained in CTS Corporation and Subsidiaries Quarterly Report on Form 10-Q for the Six Months Ended June 30, 2013 adjusted by $2,753 for certain corporate charges that could not
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| be supportable and directly attributable to the transaction. | ||||||||||||||||
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CTS CORPORATION AND SUBSIDIARIES
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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
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YEAR ENDED DECEMBER 31, 2012
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(In thousands, except per share amounts)
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Historical (1)
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EMS (2)
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Pro Forma Adjustments
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Pro Forma CTS
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Net sales
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$ | 576,918 | $ | 272,437 | $ | - | $ | 304,481 | ||||||||
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Costs and expenses:
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Cost of goods sold
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475,536 | 262,571 | - | 212,965 | ||||||||||||
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Insurance recovery for business interruption - casualties
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(20,893 | ) | (20,256 | ) | - | (637 | ) | |||||||||
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Selling, general and administrative expenses
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80,386 | 17,315 | - | 63,071 | ||||||||||||
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Research and development expenses
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20,918 | - | - | 20,918 | ||||||||||||
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Insurance recovery for property damage - casualties
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(1,769 | ) | (1,769 | ) | - | - | ||||||||||
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Restructuring and impairment charge
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6,386 | 2,949 | - | 3,437 | ||||||||||||
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Gain on sale-leaseback
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(10,334 | ) | - | - | (10,334 | ) | ||||||||||
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Operating earnings/(loss)
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26,688 | 11,627 | - | 15,061 | ||||||||||||
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Other (expense)/income:
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Interest (expense)/income, net
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(839 | ) | 10 | - | (849 | ) | ||||||||||
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Other income
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1,093 | 861 | - | 232 | ||||||||||||
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Total other (expense)/income
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254 | 871 | - | (617 | ) | |||||||||||
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Earnings before income taxes
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26,942 | 12,498 | - | 14,444 | ||||||||||||
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Income tax expense
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6,609 | 4,254 | - | 2,355 | ||||||||||||
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Net earnings
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$ | 20,333 | $ | 8,244 | $ | - | $ | 12,089 | ||||||||
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Net earnings per share:
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Basic
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$ | 0.60 | $ | 0.36 | ||||||||||||
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Diluted
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$ | 0.59 | $ | 0.35 | ||||||||||||
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Average common shares outstanding:
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Basic
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33,922 | 33,922 | ||||||||||||||
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Diluted
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34,523 | 34,523 | ||||||||||||||
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(1) As reported in CTS Corporation and Subsidiaries audited financial statements contained in its Annual Report on Form 10-K for the Year Ended December 31, 2012.
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(2) Derived from EMS Segment reported numbers contained in CTS Corporation and Subsidiaries Annual Report on Form 10-K for the Year Ended December 31, 2012 adjusted by $6,566 for certain corporate charges that could not be supportable and directly attributable to the transaction.
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CTS CORPORATION AND SUBSIDIARIES
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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
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YEAR ENDED DECEMBER 31, 2011
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(In thousands, except per share amounts)
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Historical (1)
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EMS (2)
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Pro Forma Adjustments
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Pro Forma CTS
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Net sales
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$ | 588,506 | $ | 308,649 | $ | - | $ | 279,857 | ||||||||
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Costs and expenses:
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Cost of goods sold
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478,657 | 288,023 | - | 190,634 | ||||||||||||
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Insurance recovery for business interruption - casualties
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(4,082 | ) | (4,082 | ) | - | - | ||||||||||
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Selling, general and administrative expenses
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71,890 | 17,754 | - | 54,136 | ||||||||||||
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Research and development expenses
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19,990 | - | - | 19,990 | ||||||||||||
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Insurance recovery for property damage - casualties
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(6,067 | ) | (6,067 | ) | - | - | ||||||||||
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Restructuring and impairment charge
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2,878 | 489 | - | 2,389 | ||||||||||||
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Gain on sale-leaseback
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- | - | - | - | ||||||||||||
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Operating earnings
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25,240 | 12,532 | - | 12,708 | ||||||||||||
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Other (expense)/income:
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Interest expense, net
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(862 | ) | (11 | ) | - | (851 | ) | |||||||||
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Other income
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1,959 | 1,500 | - | 459 | ||||||||||||
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Total other (expense)/income
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1,097 | 1,489 | - | (392 | ) | |||||||||||
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Earnings before income taxes
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26,337 | 14,021 | - | 12,316 | ||||||||||||
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Income tax expense
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5,370 | 2,707 | - | 2,663 | ||||||||||||
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Net earnings
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$ | 20,967 | $ | 11,314 | $ | - | $ | 9,653 | ||||||||
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Net earnings per share:
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Basic
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$ | 0.61 | $ | 0.28 | ||||||||||||
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Diluted
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$ | 0.60 | $ | 0.28 | ||||||||||||
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Average common shares outstanding:
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Basic
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34,321 | 34,321 | ||||||||||||||
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Diluted
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35,006 | 35,006 | ||||||||||||||
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(1) As reported in CTS Corporation and Subsidiaries audited financial statements contained in its Annual Report on Form 10-K for the Year Ended December 31, 2011.
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(2) Derived from EMS Segment reported numbers contained in CTS Corporation and Subsidiaries Annual Report on Form 10-K for the Year Ended December 31, 2011 adjusted by $5,998 for certain corporate charges that could not be supportable and directly attributable to the transaction.
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CTS CORPORATION AND SUBSIDIARIES
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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
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YEAR ENDED DECEMBER 31, 2010
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(In thousands, except per share amounts)
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Historical (1)
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EMS (2)
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Pro Forma Adjustments
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Pro Forma CTS
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Net sales
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$ | 552,641 | $ | 269,781 | $ | - | $ | 282,860 | ||||||||
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Costs and expenses:
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Cost of goods sold
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432,731 | 247,126 | - | 185,605 | ||||||||||||
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Insurance recovery for business interruption - casualties
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- | - | - | - | ||||||||||||
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Selling, general and administrative expenses
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72,310 | 17,679 | - | 54,631 | ||||||||||||
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Research and development expenses
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18,313 | - | - | 18,313 | ||||||||||||
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Insurance recovery for property damage - casualties
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- | - | - | - | ||||||||||||
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Restructuring and impairment charge
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1,444 | 434 | - | 1,010 | ||||||||||||
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Gain on sale-leaseback
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- | - | - | - | ||||||||||||
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Operating earnings/(loss)
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27,843 | 4,542 | - | 23,301 | ||||||||||||
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Other (expense)/income:
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Interest expense, net
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(689 | ) | (58 | ) | - | (631 | ) | |||||||||
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Other income/(expense)
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872 | 1,651 | - | (779 | ) | |||||||||||
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Total other income/(expense)
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183 | 1,593 | - | (1,410 | ) | |||||||||||
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Earnings before income taxes
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28,026 | 6,135 | - | 21,891 | ||||||||||||
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Income tax expense
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5,988 | 539 | - | 5,449 | ||||||||||||
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Net earnings
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$ | 22,038 | $ | 5,596 | $ | - | $ | 16,442 | ||||||||
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Net earnings per share:
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Basic
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$ | 0.65 | $ | 0.48 | ||||||||||||
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Diluted
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$ | 0.63 | $ | 0.47 | ||||||||||||
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Average common shares outstanding:
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Basic
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34,090 | 34,090 | ||||||||||||||
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Diluted
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34,849 | 34,849 | ||||||||||||||
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(1) As reported in CTS Corporation and Subsidiaries audited financial statements contained in its Annual Report on Form 10-K for the Year Ended December 31, 2010.
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(2) Derived from EMS Segment reported numbers contained in CTS Corporation and Subsidiaries Annual Report on Form 10-K for the Year Ended December 31, 2010 adjusted by $7,042 for certain corporate charges that could not be supportable and directly attributable to the transaction.
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CTS CORPORATION AND SUBSIDIARIES
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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
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AS OF JUNE 30, 2013
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(In thousands of dollars)
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Historical (1)
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EMS (2)
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Pro Forma Adjustments
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Pro Forma CTS
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Assets
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Current Assets
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Cash and cash equivalents
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$ 86,044
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$ -
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$ 73,100
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(a)
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$ 159,144
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Accounts receivable, net
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93,908
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28,339
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-
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65,569
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Inventories
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85,160
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51,778
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-
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33,382
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Other current assets
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28,955
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6,824
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-
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22,131
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Total current assets
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294,067
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86,941
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73,100
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280,226
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Property, plant & equipment, net
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91,068
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14,640
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-
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76,428
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Deferred income taxes
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61,209
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219
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-
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60,990
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Other assets
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82,329
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5,132
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-
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77,197
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Total Assets
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$ 528,673
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$ 106,932
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$ 73,100
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$ |
494,841
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Liabilities and Shareholders' Equity
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Current Liabilities
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Accounts payable
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70,694
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26,068
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-
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44,626
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Other accrued liabilities
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46,786
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11,847
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2,338
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(b)
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37,277
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Total current liabilities
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117,480
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37,915
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2,338
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81,903
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Long-term debt
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129,500
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-
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-
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129,500
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|||
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Other obligations
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20,066
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17
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-
|
20,049
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Shareholders' Equity
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Preferred stock - authorized 25,000,000 shares without par value; non issued
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-
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-
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-
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-
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Common stock - authorized 75,000,000 shares without par value; 55,672,410
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shares issued at June 30, 2013
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296,102
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28
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28
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296,102
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Additional contributed capital
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38,952
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63,623
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63,623
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38,952
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Retained earnings
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357,681
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5,349
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7,111
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359,443
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Accumulated other comprehensive loss
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(118,657)
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-
|
-
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(118,657)
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|||
|
574,078
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69,000
|
70,762
|
575,840
|
||||
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Cost of common stock held in treasury (2013 - 21,980,159)
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(312,451)
|
-
|
-
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(312,451)
|
|||
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Total shareholders' equity
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261,627
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69,000
|
70,762
|
(b)
|
263,389
|
||
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Total Liabilities and Shareholders' Equity
|
$ 528,673
|
$ 106,932
|
$ 73,100
|
$ |
494,841
|
||
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(1) As reported in CTS Corporation and Subsidiaries unaudited financial statements contained in its Quarterly Report on Form 10-Q as of June 30, 2013.
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(2) Derived from EMS Segment reported numbers contained in CTS Corporation and Subsidiaries Quarterly Report on Form 10-Q as of June 30, 2013 adjusted for assets and liabilities excluded from the stock purchase agreement.
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UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
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NOTES TO UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS
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Pro forma adjustments reflect only those adjustments which are supportable and directly attributable to the transaction
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and do not include the impact of contingencies. Pro forma adjustments include the following ($ in thousands):
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(a) To record cash proceeds of $75,000 net of transaction costs of $1,900 for the sale of the EMS business.
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(b) Adjustment to Equity of $73,100 consists of net assets of EMS sold to Benchmark Electronics, Inc. of
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$69,000 and the estimated gain on sale of net assets of $4,100 (net of taxes of $2,338). The gain is derived from
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the June 30, 2013 pro forma statements, the most recently available financial information.
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