Missouri | 1-15401 | 43-1863181 |
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employee Identification No.) |
Exhibit No. | Description |
99.1 | Unaudited Pro Forma Condensed Consolidated Financial Statements |
Exhibit No. | Description |
99.1 | Unaudited Pro Forma Condensed Consolidated Financial Statements |
• | the contribution by the Company to New Energizer, pursuant to the Separation, of all the assets and liabilities that comprised the Household Products business of the historical combined company; |
• | costs incurred in connection with the Separation; |
• | the impact of debt transactions entered into in connection with the Separation; and |
• | the impact of the separation and distribution, tax matters, transition services, employee matters and other agreements entered into by Edgewell and New Energizer as a result of the Separation, and the provisions contained therein. |
Historical | Separation of New Energizer (1) | Pro Forma Adjustments | Pro Forma for the Separation | ||||||||||||||
Net sales | $ | 2,046.4 | $ | (858.2 | ) | $ | — | $ | 1,188.2 | ||||||||
Cost of products sold | 1,055.7 | (458.2 | ) | — | 597.5 | ||||||||||||
Gross profit | 990.7 | (400.0 | ) | — | 590.7 | ||||||||||||
Selling, general and administrative expense | 442.3 | (127.3 | ) | (89.1 | ) | (2 | ) | 225.9 | |||||||||
Advertising and sales promotion expense | 193.0 | (63.9 | ) | — | 129.1 | ||||||||||||
Research and development expense | 44.3 | (12.6 | ) | — | 31.7 | ||||||||||||
Venezuela deconsolidation charge | 144.5 | (65.2 | ) | — | 79.3 | ||||||||||||
Spin restructuring | 48.3 | — | (48.3 | ) | (2 | ) | — | ||||||||||
2013 restructuring | 6.4 | 9.4 | — | 15.8 | |||||||||||||
Interest expense | 57.6 | — | (26.4 | ) | (3 | ) | 31.2 | ||||||||||
Other financing items, net | (8.7 | ) | 7.3 | — | (1.4 | ) | |||||||||||
Earnings before income taxes | 63.0 | (147.7 | ) | 163.8 | 79.1 | ||||||||||||
Income tax provision | 46.4 | (62.7 | ) | 61.1 | (4 | ) | 44.8 | ||||||||||
Net earnings from continuing operations | $ | 16.6 | $ | (85.0 | ) | $ | 102.7 | $ | 34.3 | ||||||||
Basic earnings per share from continuing operations | $ | 0.27 | $ | 0.55 | |||||||||||||
Diluted earnings per share from continuing operations | $ | 0.27 | $ | 0.55 | |||||||||||||
Basic weighted-average number of shares outstanding | 62.1 | 62.1 | |||||||||||||||
Diluted weighted-average number of shares outstanding | 62.5 | 62.5 |
Historical | Separation of New Energizer (1) | Pro Forma Adjustments | Pro Forma for the Separation | ||||||||||||||
Net sales | $ | 4,447.7 | $ | (1,835.5 | ) | $ | — | $ | 2,612.2 | ||||||||
Cost of products sold | 2,312.5 | (990.1 | ) | — | 1,322.4 | ||||||||||||
Gross profit | 2,135.2 | (845.4 | ) | — | 1,289.8 | ||||||||||||
Selling, general and administrative expense | 859.9 | (305.0 | ) | (44.7 | ) | (2 | ) | 510.2 | |||||||||
Advertising and sales promotion expense | 492.9 | (121.7 | ) | — | 371.2 | ||||||||||||
Research and development expense | 94.8 | (25.3 | ) | — | 69.5 | ||||||||||||
2013 restructuring | 92.6 | (42.7 | ) | — | 49.9 | ||||||||||||
Net pension and post-retirement gains | (1.1 | ) | — | — | (1.1 | ) | |||||||||||
Interest expense | 122.6 | — | (52.7 | ) | (3 | ) | 69.9 | ||||||||||
Other financing items, net | — | 0.8 | — | 0.8 | |||||||||||||
Earnings before income taxes | 473.5 | (351.5 | ) | 97.4 | 219.4 | ||||||||||||
Income tax provision | 117.4 | (101.6 | ) | 36.3 | (4 | ) | 52.1 | ||||||||||
Net earnings from continuing operations | $ | 356.1 | $ | (249.9 | ) | $ | 61.1 | $ | 167.3 | ||||||||
Basic earnings per share from continuing operations | $ | 5.74 | $ | 2.70 | |||||||||||||
Diluted earnings per share from continuing operations | $ | 5.69 | $ | 2.67 | |||||||||||||
Basic weighted-average number of shares outstanding | 62.0 | 62.0 | |||||||||||||||
Diluted weighted-average number of shares outstanding | 62.6 | 62.6 |
Historical | Separation of New Energizer (1) | Pro Forma Adjustments | Pro Forma for the Separation | ||||||||||||||
Net sales | $ | 4,466.0 | $ | (2,017.1 | ) | $ | — | $ | 2,448.9 | ||||||||
Cost of products sold | 2,361.7 | (1,112.2 | ) | — | 1,249.5 | ||||||||||||
Gross profit | 2,104.3 | (904.9 | ) | — | 1,199.4 | ||||||||||||
Selling, general and administrative expense | 825.0 | (326.6 | ) | — | 498.4 | ||||||||||||
Advertising and sales promotion expense | 439.9 | (127.4 | ) | — | 312.5 | ||||||||||||
Research and development expense | 99.0 | (29.7 | ) | — | 69.3 | ||||||||||||
2013 restructuring | 139.3 | (121.3 | ) | — | 18.0 | ||||||||||||
Net pension and post-retirement gains | (107.6 | ) | 68.3 | — | (39.3 | ) | |||||||||||
Interest expense | 130.5 | — | (51.9 | ) | (3 | ) | 78.6 | ||||||||||
Other financing items, net | 10.3 | (1.9 | ) | — | 8.4 | ||||||||||||
Earnings before income taxes | 567.9 | (366.3 | ) | 51.9 | 253.5 | ||||||||||||
Income tax provision | 160.9 | (116.3 | ) | 19.3 | (4 | ) | 63.9 | ||||||||||
Net earnings from continuing operations | $ | 407.0 | $ | (250.0 | ) | $ | 32.6 | $ | 189.6 | ||||||||
Basic earnings per share from continuing operations | $ | 6.55 | $ | 3.05 | |||||||||||||
Diluted earnings per share from continuing operations | $ | 6.47 | $ | 3.01 | |||||||||||||
Basic weighted-average number of shares outstanding | 62.1 | 62.1 | |||||||||||||||
Diluted weighted-average number of shares outstanding | 62.9 | 62.9 |
Historical | Separation of New Energizer (1) | Pro Forma Adjustments | Pro Forma for the Separation | ||||||||||||||
Net sales | $ | 4,567.2 | $ | (2,087.7 | ) | $ | — | $ | 2,479.5 | ||||||||
Cost of products sold | 2,429.3 | (1,192.1 | ) | — | 1,237.2 | ||||||||||||
Gross profit | 2,137.9 | (895.6 | ) | — | 1,242.3 | ||||||||||||
Selling, general and administrative expense | 887.8 | (341.2 | ) | — | 546.6 | ||||||||||||
Advertising and sales promotion expense | 449.5 | (109.8 | ) | — | 339.7 | ||||||||||||
Research and development expense | 112.5 | (41.8 | ) | — | 70.7 | ||||||||||||
2013 restructuring | 7.3 | (6.4 | ) | — | 0.9 | ||||||||||||
Net pension and post-retirement gains | (6.8 | ) | 6.8 | — | — | ||||||||||||
Interest expense | 127.3 | — | (48.3 | ) | (3 | ) | 79.0 | ||||||||||
Other financing items, net | (5.1 | ) | 1.3 | — | (3.8 | ) | |||||||||||
Earnings before income taxes | 565.4 | (404.5 | ) | 48.3 | 209.2 | ||||||||||||
Income tax provision | 156.5 | (124.3 | ) | 18.0 | (4 | ) | 50.2 | ||||||||||
Net earnings from continuing operations | $ | 408.9 | $ | (280.2 | ) | $ | 30.3 | $ | 159.0 | ||||||||
Basic earnings per share from continuing operations | $ | 6.30 | $ | 2.45 | |||||||||||||
Diluted earnings per share from continuing operations | $ | 6.22 | $ | 2.42 | |||||||||||||
Basic weighted-average number of shares outstanding | 64.9 | 64.9 | |||||||||||||||
Diluted weighted-average number of shares outstanding | 65.7 | 65.7 |
Historical | Separation of New Energizer (1) | Pro Forma Adjustments | Pro Forma for the Separation | ||||||||||||||
Assets | |||||||||||||||||
Current assets | |||||||||||||||||
Cash and cash equivalents | $ | 1,114.3 | $ | (413.2 | ) | $ | — | $ | 701.1 | ||||||||
Trade receivables, net | 448.9 | (160.0 | ) | — | 288.9 | ||||||||||||
Inventories | 657.9 | (271.6 | ) | — | 386.3 | ||||||||||||
Other current assets | 490.2 | (81.3 | ) | — | 408.9 | ||||||||||||
Total current assets | 2,711.3 | (926.1 | ) | — | 1,785.2 | ||||||||||||
Property, plant and equipment, net | 714.6 | (225.6 | ) | — | 489.0 | ||||||||||||
Goodwill | 1,458.8 | (38.0 | ) | — | 1,420.8 | ||||||||||||
Other intangible assets, net | 1,817.5 | (78.0 | ) | — | 1,739.5 | ||||||||||||
Other assets | 105.3 | (56.7 | ) | — | 48.6 | ||||||||||||
Total assets | $ | 6,807.5 | $ | (1,324.4 | ) | $ | — | $ | 5,483.1 | ||||||||
Liabilities and Equity | |||||||||||||||||
Current liabilities | |||||||||||||||||
Current maturities of long-term debt | $ | 220.0 | $ | — | $ | (220.0 | ) | (3 | ) | $ | — | ||||||
Notes payable | 513.2 | (6.2 | ) | (75.0 | ) | (3 | ) | 432.0 | |||||||||
Accounts payable | 364.4 | (111.1 | ) | — | 253.3 | ||||||||||||
Other current liabilities | 603.8 | (151.4 | ) | — | 452.4 | ||||||||||||
Total current liabilities | 1,701.4 | (268.7 | ) | (295.0 | ) | 1,137.7 | |||||||||||
Long-term debt | 1,699.0 | — | (599.0 | ) | (3 | ) | 1,100.0 | ||||||||||
Deferred income tax liabilities | 485.7 | 106.0 | — | 591.7 | |||||||||||||
Other liabilities | 558.1 | (16.6 | ) | — | 541.5 | ||||||||||||
Total liabilities | $ | 4,444.2 | $ | (179.3 | ) | $ | (894.0 | ) | $ | 3,370.9 | |||||||
Total equity | $ | 2,363.3 | $ | (1,145.1 | ) | $ | 894.0 | $ | 2,112.2 | ||||||||
Total liabilities and equity | $ | 6,807.5 | $ | (1,324.4 | ) | $ | — | $ | 5,483.1 |
(1) | Reflects amounts representing the revenues, expenses, assets, liabilities and equity attributable to New Energizer, which were included in the Company's historical financial statements. In addition to amounts included in the Company's Household Products segment, the "Separation of New Energizer" amounts include certain assets and liabilities related to New Energizer that were previously reported in the Company's unallocated corporate amounts. Certain corporate expenses previously allocated to the Company's Household Products segment that were not specifically related to New Energizer have been excluded, as such general corporate expenses do not meet the requirements to be presented in discontinued operations. |
(2) | Reflects the removal of separation costs of $89.1 million and $48.3 million recorded in Selling, general and administrative expense and Spin restructuring, respectively, for the six months ended March 31, 2015, and $44.7 million in Selling, general and administrative expense for the fiscal year ended September 30, 2014, related to the Separation. These costs primarily related to restructuring and legal, tax, accounting and other professional services. |
(3) | In connection with the Separation, the Company entered into certain transactions to establish the debt structure of Edgewell and New Energizer. Debt transactions entered into since March 31, 2015 and prior to the Separation included a $1.0 billion bridge loan facility used to prepay the Company's Private Placement notes for $890.5 million (which included a make-whole premium of $61.4 million and accrued interest of $9.1 million). Remaining proceeds from the bridge loan facility, along with a draw down from the existing U.S. revolver, were used to repay outstanding advances under the Company's receivables securitization program. Debt transactions entered into since March 31, 2015 and prior to the Separation also included borrowings from New Energizer debt facilities of $600.0 million 5.5% senior notes and a $400.0 million term loan facility, both of which will remain with New Energizer. Following the Separation, the Company has approximately $1.5 billion in outstanding long-term debt and notes payable, consisting of $1.1 billion existing public notes due in 2021 and 2022, approximately $270.0 million outstanding on a short-term facility in the Netherlands, approximately $145.0 million outstanding on a new revolving credit facility in the U.S. and other short term international borrowings of approximately $17.0 million. The pro forma adjustments on the Unaudited Pro Forma Condensed Consolidated Statements of Earnings reflect interest of $26.4 million, $52.7 million, $51.9 million and $48.3 million for the six months ended March 31, 2015 and the fiscal years ended September 30, 2014, September 30, 2013 and September 30, 2012, respectively, that would not have been incurred had these transactions occurred at the beginning of the first period presented. The pro forma adjustments for interest expense were computed using the historical average debt outstanding over the period and the historical weighted average interest rates of 5.9%, 5.9%, 5.8% and 5.4% for the six months ended March 31, 2015 and the fiscal years ended September 30, 2014, September 30, 2013 and September 30, 2012, respectively. The pro forma adjustment on the Unaudited Pro Forma Condensed Consolidated Balance Sheet reflects the appropriate classification of the Company's debt and the net reduction in long-term debt resulting from the transfer of debt to New Energizer, offset by increases in current borrowings. |
(4) | Represents an increase in the income tax provision associated with the tax effects of the pro forma adjustments described above at the applicable statutory income tax rates. |