Attached files
| file | filename |
|---|---|
| 8-K - 8-K - RENTECH, INC. | d152794d8k.htm |
| EX-10.1 - EX-10.1 - RENTECH, INC. | d152794dex101.htm |
| EX-10.2 - EX-10.2 - RENTECH, INC. | d152794dex102.htm |
Exhibit 99.1
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
On March 14, 2016, Rentech, Inc. (the “Company”) completed the sale of Rentech Nitrogen Pasadena Holdings, LLC (“Pasadena Holdings”) to Pasadena Commodities International, LLC, an affiliate of Interoceanic Corporation. The transaction calls for an initial cash payment to the Partnership of $5.0 million and a cash working capital adjustment, which is expected to be approximately $6.0 million, after confirmation of the amount within ninety days of the closing of the transaction. The purchase agreement also includes a milestone payment which would be paid to Rentech Nitrogen Partners, L.P. (the “Partnership”) unitholders equal to 50% of the facility’s EBITDA, as defined in the purchase agreement, in excess of $8.0 million cumulatively earned over the next two years.
The following unaudited pro forma condensed consolidated financial statements have been derived by the application of adjustments to the Company’s historical consolidated financial statements. The unaudited pro forma condensed consolidated statements of operations for the three years ended December 31, 2015 are presented as if the disposition had occurred as of January 1, 2013. The unaudited pro forma condensed consolidated balance sheet as of December 31, 2015 is presented as if the disposition had occurred on December 31, 2015.
The unaudited pro forma condensed consolidated financial statements are being provided for informational purposes only and are not necessarily indicative of the results of operations or financial position that would have resulted if the disposition had actually occurred on the dates indicated and are not intended to project the Company’s results of operations or financial position for any future period. The unaudited adjustments are based on estimates, available information, and certain assumptions that the Company believes are reasonable, as described in the accompanying notes. The pro forma adjustments reflect the impact of events directly attributable to the sale of Pasadena Holdings and related transaction agreements that are factually supportable, and for purposes of the statements of operations, are expected to have a continuing impact on the Company. The pro forma financial statements do not reflect any assumed proceeds from the milestone payment. The unaudited pro forma condensed consolidated financial statements and the accompanying notes should be read in conjunction with the historical consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 filed with the Securities and Exchange Commission on March 15, 2016.
RENTECH, INC.
Unaudited Pro Forma Condensed Consolidated Balance Sheet
As of December 31, 2015
(Amounts in thousands)
| Pro Forma Adjustments | ||||||||||||||||
| Company Historical |
Adjustment to Eliminate Pasadena Holdings (1) |
Adj. (2) | Pro Forma | |||||||||||||
| Current Assets |
||||||||||||||||
| Cash |
$ | 41,708 | $ | (8,589 | ) | $ | 6,118 | $ | 39,237 | |||||||
| Accounts receivable, net |
11,945 | (2,450 | ) | — | 9,495 | |||||||||||
| Inventories |
45,529 | (21,758 | ) | — | 23,771 | |||||||||||
| Prepaid expenses and other current assets |
7,296 | (3,512 | ) | — | 3,784 | |||||||||||
| Other receivables, net |
3,450 | (344 | ) | — | 3,106 | |||||||||||
| Assets of discontinued operations |
27,201 | — | — | 27,201 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total current assets |
137,129 | (36,653 | ) | 6,118 | 106,594 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Property, plant and equipment, net |
242,510 | (1,810 | ) | — | 240,700 | |||||||||||
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|
|
|
|
|
|
|
|
|||||||||
| Construction in progress |
5,134 | (895 | ) | — | 4,239 | |||||||||||
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|
|
|||||||||
| Other assets |
||||||||||||||||
| Goodwill |
40,255 | — | — | 40,255 | ||||||||||||
| Intangible assets |
36,084 | — | — | 36,084 | ||||||||||||
| Deposits and other assets |
4,530 | (71 | ) | — | 4,459 | |||||||||||
| Property held for sale |
2,359 | — | — | 2,359 | ||||||||||||
| Assets of discontinued operations |
182,290 | — | — | 182,290 | ||||||||||||
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|
|
|
|
|
|
|
|
|||||||||
| Total other assets |
265,518 | (71 | ) | — | 265,447 | |||||||||||
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|
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|
|||||||||
| Total assets |
$ | 650,291 | $ | (39,429 | ) | $ | 6,118 | $ | 616,980 | |||||||
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|
|
|
|
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|
|
|||||||||
| Current liabilities |
||||||||||||||||
| Accounts payable |
$ | 17,281 | (5,015 | ) | — | $ | 12,266 | |||||||||
| Accrued payroll and benefits |
6,858 | (1,518 | ) | — | 5,340 | |||||||||||
| Accrued liabilities |
22,802 | (4,126 | ) | — | 18,676 | |||||||||||
| Deferred revenue |
12,187 | (10,786 | ) | — | 1,401 | |||||||||||
| Current portion of long-term debt |
18,744 | — | — | 18,744 | ||||||||||||
| Accrued interest |
337 | — | — | 337 | ||||||||||||
| Other |
2,554 | (377 | ) | — | 2,177 | |||||||||||
| Liabilities of discontinued operations |
32,606 | — | — | 32,606 | ||||||||||||
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|
|||||||||
| Total current liabilities |
113,369 | (21,822 | ) | — | 91,547 | |||||||||||
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|
|||||||||
| Long-term liabilities |
||||||||||||||||
| Debt |
157,268 | — | — | 157,268 | ||||||||||||
| Earn-out consideration |
871 | — | — | 871 | ||||||||||||
| Asset retirement obligation |
4,270 | (4,047 | ) | — | 223 | |||||||||||
| Deferred income taxes |
7,301 | — | — | 7,301 | ||||||||||||
| Other |
3,216 | (1,541 | ) | — | 1,675 | |||||||||||
| Liabilities of discontinued operations |
348,576 | — | — | 348,576 | ||||||||||||
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|
|||||||||
| Total long-term liabilities |
521,502 | (5,588 | ) | — | 515,914 | |||||||||||
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|
|||||||||
| Total liabilities |
634,871 | (27,410 | ) | — | 607,461 | |||||||||||
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|
|||||||||
| Mezzanine equity |
||||||||||||||||
| Series E convertible preferred stock |
95,840 | — | — | 95,840 | ||||||||||||
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|
|||||||||
| Stockholders’ equity (deficit) |
||||||||||||||||
| Common stock |
230 | — | — | 230 | ||||||||||||
| Additional paid-in capital |
543,724 | (160,991 | ) | — | 382,733 | |||||||||||
| Accumulated deficit |
(531,971 | ) | 153,995 | 6,118 | (371,858 | ) | ||||||||||
| Accumulated other comprehensive loss |
(27,204 | ) | (172 | ) | — | (27,376 | ) | |||||||||
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|||||||||
| Total Rentech stockholders’ equity (deficit) |
(15,221 | ) | (7,168 | ) | 6,118 | (16,271 | ) | |||||||||
| Noncontrolling interests |
(65,199 | ) | (4,851 | ) | — | (70,050 | ) | |||||||||
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|
|||||||||
| Total equity (deficit) |
(80,420 | ) | (12,019 | ) | 6,118 | (86,321 | ) | |||||||||
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|
|||||||||
| Total liabilities and stockholders’ equity (deficit) |
$ | 650,291 | $ | (39,429 | ) | $ | 6,118 | $ | 616,980 | |||||||
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|||||||||
RENTECH, INC.
Unaudited Pro Forma Condensed Consolidated Statement of Operations
For the year ended December 31, 2015
(Amounts in thousands, except per share data)
| Pro Forma Adjustments | ||||||||||||||||
| Company Historical |
Adjustment to Eliminate Pasadena Holdings (1) |
Adj. (2) | Pro Forma | |||||||||||||
| Revenues |
||||||||||||||||
| Product sales |
$ | 222,856 | $ | (137,040 | ) | $ | — | $ | 85,816 | |||||||
| Service revenues |
70,569 | — | — | 70,569 | ||||||||||||
| Other revenues |
2,419 | (2,347 | ) | — | 72 | |||||||||||
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|||||||||
| Total revenues |
295,844 | (139,387 | ) | — | 156,457 | |||||||||||
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|||||||||
| Cost of sales |
||||||||||||||||
| Product |
219,318 | (134,731 | ) | — | 84,587 | |||||||||||
| Service |
53,879 | — | — | 53,879 | ||||||||||||
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|
|||||||||
| Total cost of sales |
273,197 | (134,731 | ) | — | 138,466 | |||||||||||
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|||||||||
| Gross profit |
22,647 | (4,656 | ) | — | 17,991 | |||||||||||
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|||||||||
| Operating expenses |
||||||||||||||||
| Selling, general and administrative expense |
56,262 | (3,937 | ) | — | 52,325 | |||||||||||
| Depreciation and amortization |
5,930 | (755 | ) | — | 5,175 | |||||||||||
| Asset impairment |
171,878 | (160,622 | ) | — | 11,256 | |||||||||||
| Other expense, net |
3,395 | — | — | 3,395 | ||||||||||||
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|||||||||
| Total operating expenses |
237,465 | (165,314 | ) | — | 72,151 | |||||||||||
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|||||||||
| Operating loss |
(214,818 | ) | 160,658 | — | (54,160 | ) | ||||||||||
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|
|||||||||
| Other income (expense), net |
||||||||||||||||
| Interest expense |
(10,746 | ) | — | — | (10,746 | ) | ||||||||||
| Gain on fair value adjustment to earn-out consideration |
230 | — | — | 230 | ||||||||||||
| Other income, net |
2,372 | (1,425 | ) | — | 947 | |||||||||||
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|
|||||||||
| Total other expenses, net |
(8,144 | ) | (1,425 | ) | — | (9,569 | ) | |||||||||
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|
|||||||||
| Loss from continuing operations before income taxes and equity in loss of investee |
(222,962 | ) | 159,233 | — | (63,729 | ) | ||||||||||
| Income tax benefit |
(12,417 | ) | (45 | ) | — | (12,462 | ) | |||||||||
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|||||||||
| Loss from continuing operations before equity in loss of investee |
(210,545 | ) | 159,278 | — | (51,267 | ) | ||||||||||
| Equity in loss of investee |
473 | — | — | 473 | ||||||||||||
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|
|||||||||
| Loss from continuing operations |
(211,018 | ) | 159,278 | — | (51,740 | ) | ||||||||||
| Income from discontinued operations, net of tax |
57,987 | — | — | 57,987 | ||||||||||||
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|
|||||||||
| Net income (loss) |
(153,031 | ) | 159,278 | — | 6,247 | |||||||||||
| Net (income) loss attributable to noncontrolling interests |
38,422 | — | (64,285 | ) | (25,863 | ) | ||||||||||
| Preferred stock dividends |
(5,280 | ) | — | — | (5,280 | ) | ||||||||||
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|||||||||
| Net loss attributable to Rentech common shareholders |
$ | (119,889 | ) | $ | 159,278 | $ | (64,285 | ) | $ | (24,896 | ) | |||||
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|||||||||
| Net loss per common share allocated to Rentech common shareholders: |
||||||||||||||||
| Basic and diluted: |
||||||||||||||||
| Continuing operations |
$ | (6.50 | ) | $ | (2.48 | ) | ||||||||||
| Net loss |
$ | (5.22 | ) | $ | (1.08 | ) | ||||||||||
| Weighted-average shares used to compute loss per common share: |
||||||||||||||||
| Basic and diluted |
22,981 | 22,981 | ||||||||||||||
RENTECH, INC.
Unaudited Pro Forma Condensed Consolidated Statement of Operations
For the year ended December 31, 2014
(Amounts in thousands, except per share data)
| Pro Forma Adjustments | ||||||||||||||||
| Company Historical |
Pro Forma Adjustment to Eliminate Pasadena Holdings (1) |
Adj. (2) | Pro Forma | |||||||||||||
| Revenues |
||||||||||||||||
| Product sales |
$ | 196,802 | $ | (136,171 | ) | $ | — | $ | 60,631 | |||||||
| Service revenues |
70,317 | — | — | 70,317 | ||||||||||||
| Other revenues |
2,062 | (2,062 | ) | — | — | |||||||||||
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|
|||||||||
| Total revenues |
269,181 | (138,233 | ) | — | 130,948 | |||||||||||
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|
|||||||||
| Cost of sales |
||||||||||||||||
| Product |
206,849 | (152,541 | ) | — | 54,308 | |||||||||||
| Service |
57,443 | — | — | 57,443 | ||||||||||||
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|
|
|
|
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|
|
|||||||||
| Total cost of sales |
264,292 | (152,541 | ) | — | 111,751 | |||||||||||
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| Gross profit |
4,889 | 14,308 | — | 19,197 | ||||||||||||
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| Operating expenses |
||||||||||||||||
| Selling, general and administrative expense |
61,718 | (5,078 | ) | — | 56,640 | |||||||||||
| Depreciation and amortization |
4,202 | (1,315 | ) | — | 2,887 | |||||||||||
| Pasadena goodwill impairment |
27,202 | (27,202 | ) | — | — | |||||||||||
| Other expense, net |
(293 | ) | (5 | ) | — | (298 | ) | |||||||||
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|
|||||||||
| Total operating expenses |
92,829 | (33,600 | ) | — | 59,229 | |||||||||||
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|||||||||
| Operating loss |
(87,940 | ) | 47,908 | — | (40,032 | ) | ||||||||||
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| Other income (expense), net |
||||||||||||||||
| Interest expense |
(3,277 | ) | — | — | (3,277 | ) | ||||||||||
| Loss on debt estinguishment |
(850 | ) | — | — | (850 | ) | ||||||||||
| Gain on fair value adjustment to earn-out consideration |
(1,033 | ) | — | — | (1,033 | ) | ||||||||||
| Other income, net |
618 | — | — | 618 | ||||||||||||
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|
|
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|
|||||||||
| Total other expenses, net |
(4,542 | ) | — | — | (4,542 | ) | ||||||||||
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|
|
|
|
|
|
|
|
|||||||||
| Loss from continuing operations before income taxes and equity in loss of investee |
(92,482 | ) | 47,908 | — | (44,574 | ) | ||||||||||
| Income tax benefit |
(12,316 | ) | (18 | ) | — | (12,334 | ) | |||||||||
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|
|||||||||
| Loss from continuing operations before equity in loss of investee |
(80,166 | ) | 47,926 | — | (32,240 | ) | ||||||||||
| Equity in loss of investee |
393 | — | — | 393 | ||||||||||||
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|
|
|
|||||||||
| Loss from continuing operations |
(80,559 | ) | 47,926 | — | (32,633 | ) | ||||||||||
| Income from discontinued operations, net of tax |
48,055 | — | — | 48,055 | ||||||||||||
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|
|
|
|
|
|
|
|||||||||
| Net income (loss) |
(32,504 | ) | 47,926 | — | 15,422 | |||||||||||
| Net income (loss) attributable to noncontrolling interests |
494 | — | (19,290 | ) | (18,796 | ) | ||||||||||
| Preferred stock dividends |
(3,840 | ) | — | — | (3,840 | ) | ||||||||||
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|||||||||
| Net loss attributable to Rentech common shareholders |
$ | (35,850 | ) | $ | 47,926 | $ | (19,290 | ) | $ | (7,214 | ) | |||||
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|||||||||
| Net loss per common share allocated to Rentech common shareholders: |
||||||||||||||||
| Basic and diluted: |
||||||||||||||||
| Continuing operations |
$ | (2.71 | ) | $ | (1.60 | ) | ||||||||||
| Net loss |
$ | (1.57 | ) | $ | (0.32 | ) | ||||||||||
| Weighted-average shares used to compute loss per common share: |
||||||||||||||||
| Basic and diluted |
22,856 | 22,856 | ||||||||||||||
RENTECH, INC.
Unaudited Pro Forma Condensed Consolidated Statement of Operations
For the year ended December 31, 2013
(Amounts in thousands, except per share data)
| Pro Forma Adjustments | ||||||||||||||||||||
| Adjustment | ||||||||||||||||||||
| to Eliminate | ||||||||||||||||||||
| Company Historical |
Pasadena Holdings (1) |
Adj. (2) | Adj. (3) | Pro Forma | ||||||||||||||||
| Revenues |
||||||||||||||||||||
| Product sales |
$ | 141,262 | $ | (131,170 | ) | — | $ | — | $ | 10,092 | ||||||||||
| Service revenues |
48,192 | — | — | — | 48,192 | |||||||||||||||
| Other revenues |
2,505 | (2,505 | ) | — | — | — | ||||||||||||||
|
|
|
|
|
|
|
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|
|
|||||||||||
| Total revenues |
191,959 | (133,675 | ) | — | — | 58,284 | ||||||||||||||
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|
|
|
|
|
|
|
|
|
|||||||||||
| Cost of sales |
||||||||||||||||||||
| Product |
152,864 | (143,204 | ) | — | — | 9,660 | ||||||||||||||
| Service |
36,592 | — | — | — | 36,592 | |||||||||||||||
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|
|
|
|
|
|
|
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|
|||||||||||
| Total cost of sales |
189,456 | (143,204 | ) | — | — | 46,252 | ||||||||||||||
|
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|
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|
|
|
|||||||||||
| Gross profit |
2,503 | 9,529 | — | — | 12,032 | |||||||||||||||
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|
|||||||||||
| Operating expenses |
||||||||||||||||||||
| Selling, general and administrative expense |
46,529 | (4,764 | ) | — | — | 41,765 | ||||||||||||||
| Depreciation and amortization |
2,800 | (3,886 | ) | — | — | (1,086 | ) | |||||||||||||
| Goodwill impairment |
30,029 | (30,029 | ) | — | — | — | ||||||||||||||
| Loss on sale of Pasadena Holdings |
— | — | — | 148,157 | 148,157 | |||||||||||||||
| Other (income) expense |
71 | — | — | — | 71 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total operating expenses |
79,429 | (38,679 | ) | — | 148,157 | 188,907 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Operating loss |
(76,926 | ) | 48,208 | — | (148,157 | ) | (176,875 | ) | ||||||||||||
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|
|||||||||||
| Other income (expense), net |
||||||||||||||||||||
| Interest expense |
(2,295 | ) | — | — | — | (2,295 | ) | |||||||||||||
| Loss on debt extinguishment |
— | — | — | — | — | |||||||||||||||
| Gain on fair value adjustment to earn-out consideration |
5,122 | — | — | — | 5,122 | |||||||||||||||
| Other expense, net |
(271 | ) | 9 | — | — | (262 | ) | |||||||||||||
|
|
|
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|
|
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|
|
|
|
|||||||||||
| Total other expenses, net |
2,556 | 9 | — | — | 2,565 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Loss from continuing operations before income taxes and equity in loss of investee |
(74,370 | ) | 48,217 | — | (148,157 | ) | (174,310 | ) | ||||||||||||
| Income tax benefit |
(35,758 | ) | (141 | ) | — | — | (35,899 | ) | ||||||||||||
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|
|
|
|
|
|
|
|
|
|||||||||||
| Loss from continuing operations before equity in loss of investee |
(38,612 | ) | 48,358 | — | (148,157 | ) | (138,411 | ) | ||||||||||||
| Equity in loss of investee |
242 | — | — | — | 242 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Loss from continuing operations |
(38,854 | ) | 48,358 | — | (148,157 | ) | (138,653 | ) | ||||||||||||
| Income from discontinued operations, net of tax |
38,892 | — | — | — | 38,892 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net income (loss) |
38 | 48,358 | — | (148,157 | ) | (99,761 | ) | |||||||||||||
| Net (income) loss attributable to noncontrolling interests |
(1,570 | ) | — | (19,416 | ) | 59,485 | 38,499 | |||||||||||||
| Preferred stock dividends |
— | — | — | — | — | |||||||||||||||
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| Net loss attributable to Rentech common shareholders |
$ | (1,532 | ) | $ | 48,358 | $ | (19,416 | ) | $ | (88,672 | ) | $ | (61,262 | ) | ||||||
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| Net loss per common share allocated to Rentech common shareholders: |
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| Basic and diluted: |
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| Continuing operations |
$ | (0.72 | ) | $ | (6.13 | ) | ||||||||||||||
| Net loss |
$ | (0.07 | ) | $ | (2.71 | ) | ||||||||||||||
| Weighted-average shares used to compute loss per common share: |
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| Basic and diluted |
22,614 | 22,614 | ||||||||||||||||||
RENTECH, INC.
Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements
The unaudited pro forma condensed consolidated financial statements give effect to the sale of Pasadena Holdings’ related assets and liabilities. The unaudited pro forma condensed consolidated statements of operations for the three years ended December 31, 2015 are presented as if the sale occurred on January 1, 2013. The unaudited pro forma condensed consolidated balance sheet as of December 31, 2015 is presented as if the sale occurred on that date.
Pro Forma Adjustments to the Unaudited Pro Forma Consolidated Balance Sheet
| (1) | Reflects the deconsolidation of Pasadena Holdings’ assets and liabilities as if the disposition occurred on December 31, 2015. All amounts are derived from the Company’s historical consolidated financial statements. |
| (2) | Reflects the Company’s estimated 60% share of the distributions of net proceeds to the Partnership unitholders, which is comprised of an initial cash payment of $5.0 million, less transaction costs of $0.7 million, plus a working capital payment of $6.0 million. The working capital payment will be based off actual working capital as of March 14, 2016 pursuant to the Purchase Agreement, but for purposes of the pro forma balance sheet the adjustment has been applied to working capital as of December 31, 2015. |
Pro Forma Adjustments to the Unaudited Pro Forma Consolidated Statements of Operations
| (1) | Reflects the deconsolidation of Pasadena Holdings’ results of operations as if the disposition occurred on January 1, 2013. All amounts are derived from the Company’s historical consolidated financial statements. |
| (2) | Reflects adjustment to net (income) loss attributable to noncontrolling interests for approximately 40% of earnings relating to Pasadena Holdings. |
| (3) | Reflects loss on sale of Pasadena Holdings, net of allocation of loss to noncontrolling interests, which is comprised of $11.0 million of gross proceeds, less $0.7 million of estimated transactions costs, compared to Pasadena Holdings’ net book value of $158.5 million as of January 1, 2013. |