Attached files
| file | filename |
|---|---|
| 8-K - REX AMERICAN RESOURCES Corp | c81584_8k.htm |
Exhibit 99.1
REX American Resources Corporation
Pro Forma Consolidated (unaudited) Financial Information
On June 1, 2015, Patriot Holdings, LLC (“Patriot”) and a subsidiary of CHS Inc. (“CHS”) completed a merger that resulted in CHS acquiring 100% of the ownership interest in Patriot. REX American Resources Corporation owned a 26.6% interest in Patriot.
The Company received a cash payment of approximately $45.5 million at the closing, representing its proportionate share of the merger proceeds. Assuming the full payment of escrow holdbacks, the Company would receive an additional amount of approximately $5.0 million within 18 months of the closing.
The data in the unaudited pro forma consolidated statements of operations for the year ended January 31, 2015 and the three months ended April 30, 2015 assumes that the merger was completed on February 1, 2014. The unaudited pro forma consolidated balance sheet as of April 30, 2015 gives effect to the merger as if it had occurred on April 30, 2015.
The unaudited pro forma consolidated financial information has been derived from the application of pro forma adjustments to the historical consolidated financial statements of the Company. The unaudited pro forma financial information is presented for illustrative purposes only and is not necessarily indicative of the financial position or results of operations that would have actually been reported had the merger occurred as of the beginning of the periods presented or at the balance sheet date presented, nor is it necessarily indicative of future financial position or results of operations. The pro forma adjustments give effect to the preliminary estimated classification of the escrow proceeds. The pro forma adjustments are based upon available information and certain assumptions we believe are reasonable.
The unaudited pro forma consolidated financial information includes historical financial information for the Company. The Company’s historical consolidated balance sheet as of April 30, 2015 and its historical consolidated statement of operations for the three months ended April 30, 2015 were taken from the unaudited consolidated condensed financial statements in the Company’s quarterly report on Form 10-Q for the quarter ended April 30, 2015. The Company’s historical consolidated statement of operations for the year ended January 31, 2015 was taken from the audited consolidated financial statements in the Company’s most recent annual report on Form 10-K for the year ended January 31, 2015.
The unaudited pro forma financial information should be read in conjunction with the historical consolidated financial statements and notes thereto of the Company included on Form 10-Q for the quarter ended April 30, 2015 and Form 10-K for the year ended January 31, 2015.
| PF-1 |
REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES
Unaudited Pro Forma Consolidated Condensed Balance Sheet
As of April 30, 2015
(Amounts in Thousands)
| Historical | Pro Forma Adjustments | Pro Forma Consolidated | ||||||||||
| Assets | ||||||||||||
| Current assets: | ||||||||||||
| Cash and cash equivalents | $ | 141,886 | $ | 45,476 | (1) | $ | 187,362 | |||||
| Accounts receivable | 9,928 | 2,886 | (1) | 12,814 | ||||||||
| Inventory | 19,566 | — | 19,566 | |||||||||
| Refundable income taxes | 843 | — | 843 | |||||||||
| Prepaid expenses and other | 6,116 | — | 6,116 | |||||||||
| Deferred taxes, net | 2,363 | — | 2,363 | |||||||||
| Total current assets | 180,702 | 48,362 | 229,064 | |||||||||
| Property and equipment, net | 190,310 | — | 190,310 | |||||||||
| Other assets | 6,155 | 2,114 | (1) | 8,269 | ||||||||
| Equity method investments | 78,200 | (37,005 | )(2) | 41,195 | ||||||||
| Total assets | $ | 455,367 | $ | 13,471 | $ | 468,838 | ||||||
| Liabilities and equity: | ||||||||||||
| Current liabilities: | ||||||||||||
| Accounts payable, trade | $ | 6,778 | $ | — | $ | 6,778 | ||||||
| Accrued expenses and other current liabilities | 6,746 | 5,119 | (3) | 11,865 | ||||||||
| Total current liabilities | 13,524 | 5,119 | 18,643 | |||||||||
| Long-term liabilities: | ||||||||||||
| Deferred taxes | 42,768 | — | 42,768 | |||||||||
| Other long-term liabilities | 1,672 | — | 1,672 | |||||||||
| Total long-term liabilities | 44,440 | — | 44,440 | |||||||||
| Equity: | ||||||||||||
| REX shareholders’ equity: | ||||||||||||
| Common stock | 299 | — | 299 | |||||||||
| Paid-in capital | 144,791 | — | 144,791 | |||||||||
| Retained earnings | 448,365 | 8,352 | (4) | 456,717 | ||||||||
| Treasury stock | (239,557 | ) | — | (239,557 | ) | |||||||
| Total REX shareholders’ equity | 353,898 | 8,352 | 362,250 | |||||||||
| Noncontrolling interests | 43,505 | — | 43,505 | |||||||||
| Total equity | 397,403 | 8,352 | 405,755 | |||||||||
| Total liabilities and equity | $ | 455,367 | $ | 13,471 | $ | 468,838 | ||||||
See notes to pro forma consolidated financial information.
| PF-2 |
REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES
Unaudited Pro Forma Consolidated Condensed Statements Of Operations
For the Three Months Ended April 30, 2015
(Amounts in Thousands)
| Historical | Pro Forma Adjustments | Pro Forma Consolidated | ||||||||||
| Net sales and revenue | $ | 105,197 | $ | — | $ | 105,197 | ||||||
| Cost of sales | 96,070 | — | 96,070 | |||||||||
| Gross profit | 9,127 | — | 9,127 | |||||||||
| Selling, general and administrative expenses | (4,453 | ) | — | (4,453 | ) | |||||||
| Equity in income of unconsolidated affiliates | 1,480 | (472 | )(5) | 1,008 | ||||||||
| Gain on disposal of property and equipment, net | 483 | — | 483 | |||||||||
| Interest and other income | 218 | — | 218 | |||||||||
| Interest expense | — | — | — | |||||||||
| Income from continuing operations before income taxes | 6,855 | (472 | ) | 6,383 | ||||||||
| Provision for income taxes | (2,416 | ) | 179 | (3) | (2,237 | ) | ||||||
| Income from continuing operations | 4,439 | (293 | ) | 4,146 | ||||||||
| Income from discontinued operations, net of tax | — | — | — | |||||||||
| Net income | 4,439 | (293 | ) | 4,146 | ||||||||
| Net income attributable to noncontrolling interests | (512 | ) | — | (512 | ) | |||||||
| Net income attributable to REX common shareholders | $ | 3,927 | $ | (293 | ) | $ | 3,634 | |||||
| Weighted average shares outstanding – basic | 7,900 | — | 7,900 | |||||||||
| Basic income per share from continuing operations attributable to REX common shareholders | $ | 0.50 | $ | (0.04 | ) | $ | 0.46 | |||||
| Basic income per share from discontinued operations attributable to REX common shareholders | — | — | — | |||||||||
| Basic net income per share attributable to REX common shareholders | $ | 0.50 | $ | (0.04 | ) | $ | 0.46 | |||||
| Weighted average shares outstanding – diluted | 7,900 | — | 7,900 | |||||||||
| Diluted income per share from continuing operations attributable to REX common shareholders | $ | 0.50 | $ | (0.04 | ) | $ | 0.46 | |||||
| Diluted income per share from discontinued operations attributable to REX common shareholders | — | — | — | |||||||||
| Diluted net income per share attributable to REX common shareholders | $ | 0.50 | $ | (0.04 | ) | $ | 0.46 | |||||
| Amounts attributable to REX common shareholders: | ||||||||||||
| Income from continuing operations, net of tax | $ | 3,927 | $ | (293 | ) | $ | 3,634 | |||||
| Income from discontinued operations, net of tax | — | — | — | |||||||||
| Net income | $ | 3,927 | $ | (293 | ) | $ | 3,634 | |||||
See notes to pro forma consolidated financial information.
| PF-3 |
REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES
Unaudited Pro Forma Consolidated Condensed Statements Of Operations
For the Year Ended January 31, 2015
(Amounts in Thousands)
| Historical | Pro Forma Adjustments | Pro Forma Consolidated | ||||||||||
| Net sales and revenue | $ | 572,230 | $ | — | $ | 572,230 | ||||||
| Cost of sales | 430,291 | — | 430,291 | |||||||||
| Gross profit | 141,939 | — | 141,939 | |||||||||
| Selling, general and administrative expenses | (19,422 | ) | — | (19,422 | ) | |||||||
| Equity in income of unconsolidated affiliates | 32,229 | (14,038 | )(5) | 18,191 | ||||||||
| Interest and other income | 369 | — | 369 | |||||||||
| Interest expense | (2,074 | ) | — | (2,074 | ) | |||||||
| Loss on disposal of real estate and property and equipment, net | (238 | ) | — | (238 | ) | |||||||
| Loss on derivative financial instruments | (1 | ) | — | (1 | ) | |||||||
| Income from continuing operations before income taxes | 152,802 | (14,038 | ) | 138,764 | ||||||||
| Provision for income taxes | (49,649 | ) | 5,334 | (3) | (44,315 | ) | ||||||
| Income from continuing operations | 103,153 | (8,704 | ) | 94,449 | ||||||||
| Income from discontinued operations, net of tax | 234 | — | 234 | |||||||||
| Gain on disposal of discontinued operations, net of tax | 327 | — | 327 | |||||||||
| Net income | 103,714 | (8,704 | ) | 95,010 | ||||||||
| Net income attributable to noncontrolling interests | (16,377 | ) | — | (16,377 | ) | |||||||
| Net income attributable to REX common shareholders | $ | 87,337 | $ | (8,704 | ) | $ | 78,633 | |||||
| Weighted average shares outstanding – basic | 8,109 | — | 8,109 | |||||||||
| Basic income per share from continuing operations attributable to REX common shareholders | $ | 10.70 | $ | (1.07 | ) | $ | 9.63 | |||||
| Basic income per share from discontinued operations attributable to REX common shareholders | 0.03 | — | 0.03 | |||||||||
| Basic income per share on disposal of discontinued operations attributable to REX common shareholders | 0.04 | — | 0.04 | |||||||||
| Basic net income per share attributable to REX common shareholders | $ | 10.77 | $ | (1.07 | ) | $ | 9.70 | |||||
| Weighted average shares outstanding – diluted | 8,118 | — | 8,118 | |||||||||
| Diluted income per share from continuing operations attributable to REX common shareholders | $ | 10.69 | $ | (1.07 | ) | $ | 9.62 | |||||
| Diluted income per share from discontinued operations attributable to REX common shareholders | 0.03 | — | 0.03 | |||||||||
| Diluted income per share on disposal of discontinued operations attributable to REX common shareholders | 0.04 | — | 0.04 | |||||||||
| Diluted net income per share attributable to REX common shareholders | $ | 10.76 | $ | (1.07 | ) | $ | 9.69 | |||||
| Amounts attributable to REX common shareholders: | ||||||||||||
| Income from continuing operations, net of tax | $ | 86,776 | $ | (8,704 | ) | $ | 78,072 | |||||
| Income from discontinued operations, net of tax | 561 | — | 561 | |||||||||
| Net income | $ | 87,337 | $ | (8,704 | ) | $ | 78,633 | |||||
See notes to pro forma consolidated financial information.
| PF-4 |
REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES
Notes to Pro Forma Consolidated Financial Information (unaudited)
(Amounts in Thousands)
Note 1 Represents cash proceeds of approximately $45.5 million received at the closing of the merger as well as estimated escrowed funds to be received within the next 18 months of approximately $5.0 million.
Note 2 Represents the carrying value of the investment in Patriot using the equity method of accounting.
Note 3 A tax rate of 38%, which approximates REX’s statutory rate for the year ended January 31, 2015 and for the three months ended April 30, 2015, was used to calculate related income tax effects of the pro forma adjustments.
Note 4 Represents the estimated gain, net of tax, from the sale of the Company’s interest in Patriot. It is estimated that approximately $5.0 million of the gain will be held in escrowed accounts for up to eighteen months.
Note 5 Equity in income of unconsolidated affiliates in the Consolidated Pro Forma Statements of Operations has been adjusted for historical amounts the Company reported as its share of Patriot’s earnings using the equity method of accounting.
| PF-5 |