Affinia Group Intermediate Holdings Inc. - FORM 8-K/A - EX-99.1

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8-K/A - 8-K/A - Affinia Group Intermediate Holdings Inc.	d81415d8ka.htm

Exhibit 99.1

Unaudited Pro Forma Financial Statements

The following unaudited pro forma financial statements of Affinia Group Intermediate Holdings Inc. (the “Company”) give effect to the disposition of the Company’s Affinia South America (“ASA”) segment, which is accounted for as a discontinued operation under Accounting Standards Codification 205, “Presentation of Financial Statements” (“ASC 205”), and include the operations of Pellegrino Distribuidora de Autopecas Ltda. (“Pellegrino”). The Company’s ASA segment is comprised of its operations in Brazil, Argentina and Uruguay. ASA’s operations in Brazil consist of Pellegrino and Affinia Automotiva Ltda. (“Automotiva”), which are collectively referred to as “ASA Brazil.” In the second quarter of 2015, the ASA Brazil operations met the criteria for assets held-for-sale under ASC 205 and were classified as a component of discontinued operations in the Company’s Form 10-Q for the period ended June 30, 2015. The operations of Argentina and Uruguay did not meet the held-for-sale criteria; thus, the results of operations of those businesses were included within continuing operations. Subsequent to June 30, 2015, the Company completed the disposal of all of ASA’s operations to multiple buyers. The pro forma financial information contained herein reflects the entire ASA segment as discontinued operations for all periods presented. The unaudited pro forma condensed balance sheet assumes the of the Company’s ASA segment on December 31, 2014. Such pro forma information is based upon the historical balance sheet data of the Company as of that date. The unaudited pro forma condensed statement of operations gives effect to the of the Company’s ASA segment for the year ended December 31, 2014 as if the disposition occurred on January 1, 2014. These unaudited pro forma financial statements should be read in conjunction with the historical financial statements and notes thereto contained within the Company’s Form 10-K for the year ended December 31, 2014 and Form 10-Q for the quarterly period ended June 30, 2015.


	Six Months Ended June 30,
(Dollars in millions)	2015 - As Filed			ASA Adjustments			2015 Pro Forma
Net sales	$	465		$	(21	)	$	444
Cost of sales		(352	)		15			(337	)

Gross profit		113			(6	)		107
Selling, general and administrative expenses		(70	)		3			(67	)

Operating profit		43			(3	)		40
Other income and expense, net		(1	)		1			(2	)
Interest expense		(26	)		—			(26	)

Income from continuing operations before, income tax provision, and noncontrolling interest		16			(4	)		12
Income tax provision		(9	)		1			(8	)

Net income from continuing operations	$	7		$	(3	)	$	4


	Year Ended December 31,
(Dollars in millions)	2014 - As Filed			ASA Adjustments			2014 Pro Forma
Net sales	$	1,396		$	(421	)	$	975
Cost of sales		(1,056	)		338			(718	)

Gross profit		340			(83	)		257
Selling, general and administrative expenses		(199	)		52			(147	)

Operating profit		141			(31	)		110
Other income and expense, net		(13	)		—			(13	)
Interest expense		(56	)		—			(56	)

Income from continuing operations before, income tax provision, and noncontrolling interest		72			(31	)		41
Income tax provision		(19	)		10			(9	)

Net income from continuing operations	$	53		$	(21	)	$	32


(Dollars in millions)	June 30, 2015 As Filed			ASA Adjustments			June 30, 2015 Pro Forma
Assets
Current assets:
Cash and cash equivalents	$	59		$	78	(a)	$	137
Restricted cash		10			—			10
Trade accounts receivable, less allowances of $4 million at June 30, 2015 and $4 million at December 31, 2014		96			(6	)		90
Inventories, net		178			(9	)		169
Current deferred taxes		12			—			12
Prepaid taxes		14			(1	)		13
Other current assets		14			—			14
Current assets of discontinued operations		157			(157	)(b)		—

Total current assets		540			(95	)		445
Property, plant, and equipment, net		109			(2	)		107
Goodwill		3			—			3
Other intangible assets, net		49			—			49
Deferred financing costs		12			—			12
Deferred income taxes		103			(1	)		102
Investments and other assets		6			—			6

Total assets	$	822		$	(98	)	$	724

Liabilities and shareholder’s deficit
Current liabilities:
Accounts payable	$	107		$	(3	)	$	104
Notes payable		206			—			206
Other accrued expenses		55			2			57
Accrued payroll and employee benefits		15			(1	)		14
Current liabilities of discontinued operations		46			(46	)(b)		—

Total current liabilities		429			(48	)		381
Long-term debt		616			—			616
Deferred employee benefits and other noncurrent liabilities		14			—			14

Total liabilities		1,059			(48	)		1,011

Contingencies and commitments
Shareholder’s deficit:
Common stock, $.01 par value, 1,000 shares authorized, issued and outstanding		—			—			—
Additional paid-in capital		456			—			456
Accumulated deficit		(616	)		(50	)(c)		(666	)
Accumulated other comprehensive loss		(78	)		—			(78	)

Total shareholder’s deficit of the Company		(238	)		(50	)		(288	)
Noncontrolling interest in consolidated subsidiaries		1			—			1

Total shareholder’s deficit		(237	)		(50	)		(287	)

Total liabilities and shareholder’s deficit	$	822		$	(98	)	$	724

(a)	Includes proceeds on sale of $63 million

(b)	Current assets and current liabilities of discontinued operations adjusted out as pro forma effects of the disposition taking place are already reflected.

(c)	Includes loss on sale of ASA businesses of $50 million

Affinia Group Intermediate Holdings Inc. - FORM 8-K/A - EX-99.1 - November 6, 2015

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Affinia Group Intermediate Holdings Inc. Reports