Attached files

file filename
8-K - FORM 8-K - DJO Finance LLCd188457d8k.htm

Exhibit 99.1

Unaudited Quarterly Consolidated Financial Data (Net Sales and Adjusted EBITDA by quarter)

The tables below provide the Company’s unaudited net loss and Adjusted EBITDA for each of the four fiscal quarters of 2015 and 2014, excluding the financial results of the Empi business which are reflected in discontinued operations in the Company’s Statement of Operations, together with a reconciliation between net loss and Adjusted EBITDA for each fiscal quarter for 2015 and for 2014. For a more detailed description of the individual line items in the reconciliation below, refer to the reconciliation contained in “Management’s Discussion and Analysis of Financial Condition and Results from Operations” in our Annual Report on Form 10-K for the year ended December 31, 2015 filed on March 25, 2016 with the Securities and Exchange Commission. Our SEC documents are readily available on our website at www.DJOglobal.com.

Adjusted EBITDA is defined as net income (loss) attributable to DJOFL plus interest expense, net, income tax provision (benefit), and depreciation and amortization, further adjusted for certain non-cash items, non-recurring items and other adjustment items as permitted in calculating covenant compliance and other ratios under our $1,055.0 million term loan facility and $150.0 million revolving credit facility (“Credit Facilities”) and the Indentures governing our $1,015.0 million of 8.125% second lien notes and $298.5 million of 10.75% third lien notes (collectively, the “notes”). We believe that the presentation of Adjusted EBITDA is appropriate to provide additional information to investors about the calculation of, and compliance with, certain financial covenants and other ratios in our Credit Facilities and the Indentures governing the notes. Adjusted EBITDA is a material component of these calculations.

Adjusted EBITDA should not be considered as an alternative to net income (loss) or other performance measures presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”), or as an alternative to cash flow from operations as a measure of our liquidity. Adjusted EBITDA does not represent net income (loss) or cash flow from operations as those terms are defined by GAAP and does not necessarily indicate whether cash flows will be sufficient to fund cash needs. In particular, the definition of Adjusted EBITDA under our Credit Facilities and the Indentures governing the notes allows us to add back certain non-cash, extraordinary, unusual or non-recurring charges that are deducted in calculating net income (loss). However, these are expenses that may recur, vary greatly and are difficult to predict. While Adjusted EBITDA and similar measures are frequently used as measures of operations and the ability to meet debt service requirements, Adjusted EBITDA is not necessarily comparable to other similarly titled captions of other companies due to the potential inconsistencies in the method of calculation.

 

     Twelve Months Ended     Three Months Ended  
     12/31/15     03/28/15     06/27/15     09/26/15     12/31/15  

Net loss attributable to DJO Finance LLC

   $ (340,927   $ (35,526   $ (77,977   $ (177,838   $ (49,586

Loss (income) from discontinued operations, net

     157,580        (3,992     (14,873     152,536        23,909   

Interest expense, net

     172,290        42,866        44,564        42,127        42,733   

Income tax expense, net

     12,256        1,945        5,911        2,124        2,276   

Depreciation and amortization

     117,455        28,042        28,441        28,904        32,068   

Stock-based compensation expense

     1,805        613        539        298        355   

Loss (gain) on disposal of assets

     777        (225     40        396        566   

Purchase accounting adjustments

     821        287        —          382        152   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total non-cash items

     3,403        675        579        1,076        1,073   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Global business unit reorganization and integration

     8,596        3,162        1,330        2,486        1,618   

Acquisition related expenses and integration

     8,635        499        556        2,927        4,653   

Litigation, regulatory and settlements, net

     8,864        944        1,642        1,304        4,974   

Other non-recurring

     4,247        711        1,114        1,343        1,079   

ERP Implementation and other automation projects

     3,634        728        830        1,080        996   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total non-recurring and integration charges

     33,976        6,044        5,472        9,140        13,320   

Blackstone monitoring fees

     7,000        1,750        1,750        1,750        1,750   

Noncontrolling interests

     840        301        165        140        234   

Loss on debt modification and extinguishment

     68,474        —          67,967        335        172   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total other

     7,594        4,228        (681     3,131        916   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total other adjustment items

     83,908        6,279        69,201        5,356        3,072   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA (Pre LTM Adjustments)

     239,941        46,333        61,318        63,425        68,865   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Future cost savings (LTM only)

     9,050           
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 248,991      $ 46,333      $ 61,318      $ 63,425      $ 68,865   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 


     Twelve Months Ended     Three Months Ended  
     12/31/14     03/29/14     06/28/14     09/27/14     12/31/14  

Net loss attributable to DJO Finance LLC

   $ (90,534   $ (36,522   $ (25,434   $ (21,206   $ (7,372

Income from discontinued operations, net

     (21,742     (2,242     (1,135     (7,383     (10,982

Interest expense, net

     174,325        43,676        43,593        43,287        43,769   

Income tax benefit, net

     (4,720     (1,055     (2,230     (1,257     (178

Depreciation and amortization

     119,157        29,625        29,847        29,943        29,742   

Stock-based compensation expense

     1,869        444        487        343        595   

Loss on disposal of assets

     (761     (452     (875     198        368   

Purchase accounting adjustments

     (1,250     207        25        —          (1,482
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total non-cash items

     (142     199        (363     541        (519
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Global business unit reorganization and integration

     9,753        4,275        3,551        655        1,272   

Acquisition related expenses and integration

     331        420        (121     23        9   

CFO transition

     227        107        121        (1     —     

Litigation, regulatory and settlements, net

     5,752        1,065        1,606        1,824        1,257   

Other non-recurring

     18,610        5,220        4,182        5,372        3,836   

ERP Implementation and other automation projects

     5,867        1,709        2,023        924        1,211   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total non-recurring and integration charges

     40,540        12,796        11,362        8,797        7,585   

Blackstone monitoring fees

     7,000        1,750        1,750        1,750        1,750   

Noncontrolling interests

     972        349        226        74        323   

Loss on debt modification and extinguishment

     938        —          1,019        —          (81
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total other

     5,476        150        (531     3,526        2,331   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total other adjustment items

     14,386        2,249        2,464        5,350        4,323   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 231,270      $ 48,726      $ 58,104      $ 58,072      $ 66,368