SEALED AIR CORP/DE - FORM 8-K - EX-99.1

Attached files

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EX-99.2 - EX-99.2 - SEALED AIR CORP/DE	d451612dex992.htm
8-K - FORM 8-K - SEALED AIR CORP/DE	d451612d8k.htm

Exhibit 99.1

LOGO

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

On March 25, 2017, Sealed Air Corporation (the “Company”) entered into a Purchase Agreement (the “Purchase Agreement”) with Diamond (BC) B.V. (“Buyer”), an entity advised by Bain Capital Private Equity, providing for the sale of the Company’s Diversey Care division and the food hygiene and cleaning business within the Company’s Food Care division (collectively, “Diversey”). On September 6, 2017, the Company completed the sale of Diversey to Buyer for approximately $3.2 billion.

Beginning in the first quarter of fiscal year 2017, the historical financial results of Diversey were reflected in the Company’s condensed consolidated financial results as discontinued operations. To provide a better understanding of the impact of the sale of Diversey, the following unaudited pro forma condensed consolidated financial information is presented to reflect how the sale of Diversey might have affected the historical financial statements had the transaction been consummated at an earlier date. Gross proceeds of $3.2 billion from the sale of Diversey have not been applied to pay down debt or repurchase shares in the accompanying financial statements.

The following unaudited pro forma condensed consolidated statements of operations for the six months ended June 30, 2017 and the year ended December 31, 2016, as well as the pro forma condensed consolidated balance sheet as of June 30, 2017 (collectively, the “Pro Formas”), have been derived from the Company’s historical consolidated financial statements. The unaudited pro forma condensed consolidated statements of operations have been prepared as if the sale of Diversey had occurred on January 1, 2016 (the first day of fiscal year 2016), while the unaudited pro forma condensed consolidated balance sheet has been prepared as if the sale of Diversey occurred on June 30, 2017. The Pro Formas and the accompanying notes should be read together with the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, filed with the Securities and Exchange Commission (the “SEC”) on February 15, 2017 and the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, filed with the SEC on August 9, 2017.

The Pro Formas do not purport to represent what the Company’s financial position and results of operations would have been had the sale of Diversey occurred on the dates indicated or to project financial performance for any future period or as of a future date. In addition, the Pro Formas are based on currently available information and certain assumptions that the Company believes are reasonable, and are provided for illustrative and informational purposes only. The Pro Forms conform to Generally Accepted Accounting Principles in the United States of America (“U.S. GAAP”). The Pro Formas have been prepared to reflect adjustments to the Company’s historical annual and interim consolidated financial statements that are (1) directly attributable to the sale of Diversey; (2) factually supportable; and (3) with respect to the unaudited pro forma condensed consolidated statements of operations, expected to have a continuing impact on the Company’s results of operations.

SEALED AIR CORPORATION

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS


	Six Months Ended June 30, 2017
*(In millions, except per share data)*	As reported (a)			Pro Forma Adjustments			Pro Forma Revised
Net sales	$	2,102.5					$	2,102.5
Cost of sales		1,421.8						1,421.8

Gross profit		680.7						680.7
Selling, general and administrative expenses		397.6						397.6
Amortization expense of intangible assets acquired		6.1						6.1
Restructuring and other charges		3.9			(0.9	)(b)		3.0

Operating profit		273.1			(0.9	)		272.2
Interest expense		(99.7	)					(99.7	)
Other expense, net		(6.2	)					(6.2	)

Earnings from continuing operations before income tax provision		167.2			(0.9	)		166.3
Income tax provision		192.5			(0.3	)(b)		192.2

Net loss from continuing operations		(25.3	)		(0.6	)		(25.9	)
Net earnings from discontinued operations, net of tax		69.9			(69.9	)(c)		—

Net (loss) earnings available to common stockholders	$	44.6		$	(70.5	)	$	(25.9	)

Basic:
Continuing operations	$	(0.13	)	$	—		$	(0.13	)
Discontinued operations		0.36			(0.36	)		—

Net (loss) earnings per common share — basic	$	0.23		$	(0.36	)	$	(0.13	)

Diluted:
Continuing operations	$	(0.13	)	$	—		$	(0.13	)
Discontinued operations		0.36			(0.36	)		—

Net (loss) earnings per common share — diluted	$	0.23		$	(0.36	)	$	(0.13	)

Dividends per common share	$	0.32					$	0.32

Weighted average number of common shares outstanding:
Basic		192.9						192.9

Diluted		195.3						195.3

SEALED AIR CORPORATION

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS


	Year Ended December 31, 2016
*(In millions, except per share data)*	As reported (d)			Pro Forma Adjustments (e)			Pro Forma Revised
Net sales	$	6,778.3		$	(2,567.0	)	$	4,211.3
Cost of sales		4,246.7			(1,440.3	)		2,806.4

Gross profit		2,531.6			(1,126.7	)		1,404.9
Selling, general and administrative expenses		1,604.5			(848.8	)		755.7
Amortization expense of intangible assets acquired		94.9			(79.9	)		15.0
Restructuring and other charges		13.2			(10.4	)(b)		2.8

Operating profit		819.1			(187.6	)		631.4
Interest expense		(213.1	)		13.7			(199.4	)
Foreign currency exchange loss related to Venezuelan subsidiaries		(3.4	)		1.7			(1.7	)
Charge related to Venezuelan subsidiaries		(46.0	)		(1.3	)		(47.3	)
Loss on debt redemption and refinancing		(0.1	)		—			(0.1	)
Loss on sale of business, net		(1.8	)		—			(1.8	)
Other income, net		11.2			(4.4	)		6.8

Earnings before income tax provision		565.9			(177.9	)		387.9
Income tax provision		79.5			16.1	(b)		95.6

Net earnings available to common stockholders	$	486.4		$	(194.0	)	$	292.3

Net earnings per common share:
Net earnings per common share — basic	$	2.49					$	1.50

Net earnings per common share — diluted	$	2.46					$	1.48

Dividends per common share	$	0.61					$	0.61

Weighted average number of common shares outstanding:
Basic		194.3						194.3

Diluted		197.2						197.2

SEALED AIR CORPORATION

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET


	June 30, 2017
*(In millions)*	As Reported (a)		Pro Forma Adjustments			Pro Forma Revised
ASSETS
Current assets:
Cash and cash equivalents	$	243.0	$	3,036.3	(f)	$	3,279.3
Trade receivables, net		310.3					310.3
Income tax receivables		15.9					15.9
Other receivables		77.3					77.3
Inventories, net		532.1					532.1
Assets held for sale		3,016.4		(3,015.7	)(g)		0.7
Prepaid expenses and other current assets		251.9					251.9

Total current assets		4,446.9		20.6			4,467.5
Property and equipment, net		926.7					926.7
Goodwill		1,889.1					1,889.1
Intangible assets, net		41.0					41.0
Deferred taxes		129.7					129.7
Other non-current assets		193.5					193.5

Total assets	$	7,626.9	$	20.6		$	7,647.5

LIABILITIES AND INVESTED EQUITY
Current liabilities:
Short-term borrowings	$	358.0				$	358.0
Current portion of long-term debt		297.5					297.5
Accounts payable		646.7					646.7
Current liabilities held for sale		1,293.6		(1,293.6	)(g)		—
Accrued restructuring costs		29.7					29.7
Other current liabilities		444.5		0.3	(b)		444.8

Total current liabilities		3,070.0		(1,293.3	)		1,776.7
Long-term debt, less current portion		3,790.1					3,790.1
Deferred taxes		4.4					4.4
Other non-current liabilities		422.9					422.9

Total liabilities		7,287.4		(1,293.3	)		5,994.1

Equity:
Total equity		339.5		1,313.9	(h)		1,653.4

Total liabilities and invested equity	$	7,626.9	$	20.6		$	7,647.5

SEALED AIR CORPORATION

NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following is a summary of the pro forma adjustments reflected in the unaudited pro forma condensed consolidated financial statements:

(a)

Reflects the Company’s condensed consolidated statement of operations from continuing operations and condensed consolidated balance sheet as disclosed in the Company’s Quarterly Report on Form 10-Q filed with the SEC on August 9, 2017 for the quarter ended June 30, 2017.

(b)

Represents the reclassification of restructuring expenses from continuing operations to discontinued operations based on the most recently available information. For the six months ended June 30, 2017, the impact was $0.9 million (approximately $0.6 million net of taxes) and did not materially impact net earnings per common share. As of June 30, 2017 this increased other current liabilities by $0.3 million related to income tax payable. For the year ended December 31, 2016, the impact was $1.9 million (approximately $1.6 million net of taxes) and had an impact of $0.01 per share on basic and diluted net earnings per common share.

(c)

Represents the elimination of revenue and expenses associated with Diversey for the six months ended June 30, 2017.

(d)

Reflects the Company’s consolidated statement of operations as disclosed in the Company’s Annual Report on Form 10-K filed with the SEC on February 15, 2017 for the year ended December 31, 2016.

(e)

Represents the elimination of revenue and expenses associated with Diversey for the year ended December 31, 2016.

(f)

Represents the receipt of cash of $3.0 billion at the closing of the sale of Diversey on September 6, 2017, which was net of the Buyer’s assumption of debt and other liabilities of approximately $200 million.

(g)

Represents the elimination of assets and liabilities associated with Diversey as of June 30, 2017.

(h)

Reflects the net impact of items noted above. No adjustment has been made to the sale proceeds to give effect to any potential post-closing adjustments under the terms of the Purchase Agreement.

SEALED AIR CORP/DE - FORM 8-K - EX-99.1 - September 12, 2017

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SEALED AIR CORP/DE Reports