Guarantor Financial Information

The Company's Senior Secured Notes are guaranteed by certain 100% directly owned subsidiaries of the Company (the "Guarantors"). As of December 31, 2015, the Guarantors included Total Plastics, Inc., Advanced Fabricating Technology, LLC, Keystone Tube Company, LLC and Paramont Machine Company, LLC, each of which fully and unconditionally guarantee the Senior Secured Notes on a joint and several basis.

The accompanying financial statements have been prepared and presented pursuant to Rule 3-10 of SEC Regulation S-X “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.” The financial statements present condensed consolidating financial information for A. M. Castle & Co. (the "Parent"), the Guarantors, the non-guarantor subsidiaries (all other subsidiaries) and an elimination column for adjustments to arrive at the information for the Parent, Guarantors, and non-guarantors on a consolidated basis. The condensed consolidating financial information has been prepared on the same basis as the consolidated statements of the Parent. The equity method of accounting is followed within this financial information.

During the fourth quarter of 2015, the Company changed its method of accounting for U.S metals inventories, which were previously accounted for under LIFO method, to the average cost method. The change was applied retrospectively to the prior year financial information presented. See Note 1 - Basis of Presentation and Significant Accounting Policies in the consolidated financial statements for discussion of this accounting change and its related impact.

Condensed Consolidating Balance Sheet As of December 31, 2015

	Parent		Guarantors		Non-Guarantors			Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	1,220	$	46	$	9,834		$	—		$	11,100
Accounts receivable, less allowance for doubtful accounts	39,448		16,697		33,734			—			89,879
Receivables from affiliates	759		36		—			(795		)	—
Inventories	150,809		19,353		65,349			(68		)	235,443
Prepaid expenses and other current assets	3,996		1,099		6,774			—			11,869
Total current assets	196,232		37,231		115,691			(863		)	348,291
Investment in joint venture	35,690		—		—			—			35,690
Goodwill	—		12,973		—			—			12,973
Intangible assets, net	10,116		—		134			—			10,250
Other non-current assets	15,789		—		4,622			(1,355		)	19,056
Investment in subsidiaries	33,941		—		—			(33,941		)	—
Receivables from affiliates	118,478		69,359		—			(187,837		)	—
Property, plant and equipment, net	52,770		6,833		11,790			—			71,393
Total assets	$	463,016	$	126,396	$	132,237		$	(223,996	)	$	497,653
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	32,707	$	10,666	$	12,899		$	—		$	56,272
Payables due to affiliates	759		—		36			(795		)	—
Other current liabilities	21,121		1,904		5,578			—			28,603
Current portion of long-term debt	6,980		—		32			—			7,012
Total current liabilities	61,567		12,570		18,545			(795		)	91,887
Long-term debt, less current portion	314,746		—		15			—			314,761
Payables due to affiliates	—		14,123		173,715			(187,838		)	—
Deferred income taxes	—		5,524		—			(1,355		)	4,169
Other non-current liabilities	39,715		—		133			—			39,848
Stockholders’ equity (deficit)	46,988		94,179		(60,171		)	(34,008		)	46,988
Total liabilities and stockholders’ equity	$	463,016	$	126,396	$	132,237		$	(223,996	)	$	497,653

Condensed Consolidating Balance Sheet As of December 31, 2014 (as adjusted)

	Parent		Guarantors		Non-Guarantors			Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	511	$	977	$	6,966		$	—		$	8,454
Accounts receivable, less allowance for doubtful accounts	66,178		19,303		45,522			—			131,003
Receivables from affiliates	2,071		81		—			(2,152		)	—
Inventories	265,012		19,320		75,366			(68		)	359,630
Prepaid expenses and other current assets	2,805		1,033		8,506			—			12,344
Total current assets	336,577		40,714		136,360			(2,220		)	511,431
Investment in joint venture	37,443		—		—			—			37,443
Goodwill	—		12,973		—			—			12,973
Intangible assets, net	42,772		—		13,783			—			56,555
Other non-current assets	18,441		—		996			—			19,437
Investment in subsidiaries	70,274		—		—			(70,274		)	—
Receivables from affiliates	113,188		36,607		2,157			(151,952		)	—
Property, plant and equipment, net	46,094		12,184		14,557			—			72,835
Total assets	$	664,789	$	102,478	$	167,853		$	(224,446	)	$	710,674
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	41,613	$	8,055	$	19,114		$	—		$	68,782
Payables due to affiliates	2,071		—		81			(2,152		)	—
Other current liabilities	18,841		3,065		6,092			—			27,998
Current portion of long-term debt	691		—		46			—			737
Total current liabilities	63,216		11,120		25,333			(2,152		)	97,517
Long-term debt, less current portion	307,327		—		2,050			—			309,377
Payables due to affiliates	—		5,581		146,371			(151,952		)	—
Deferred income taxes	19,359		5,524		3,846			—			28,729
Other non-current liabilities	22,238		—		164			—			22,402
Stockholders’ equity	252,649		80,253		(9,911		)	(70,342		)	252,649
Total liabilities and stockholders’ equity	$	664,789	$	102,478	$	167,853		$	(224,446	)	$	710,674

Condensed Consolidating Statement of Operations and Comprehensive (Loss) Income For the year ended December 31, 2015

	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net Sales	$	435,736		$	132,821		$	215,815		$	(13,614	)	$	770,758
Costs and expenses:
Cost of materials (exclusive of depreciation and amortization)	408,400			93,405			186,424			(13,614		)	674,615
Warehouse, processing and delivery expense	77,283			11,838			25,613			—			114,734
Sales, general and administrative expense	64,112			17,629			13,738			—			95,479
Restructuring expense (income)	21,953			(14,325		)	1,380			—			9,008
Depreciation and amortization expense	19,035			1,812			4,007			—			24,854
Impairment of intangible assets	23,491			—			10,251			—			33,742
Total costs and expenses	614,274			110,359			241,413			(13,614		)	952,432
Operating (loss) income	(178,538		)	22,462			(25,598		)	—			(181,674		)
Interest expense, net	25,712			—			16,268			—			41,980
Other expense, net	—			—			6,306			—			6,306
(Loss) income before income taxes and equity in earnings (losses) of subsidiaries and joint venture	(204,250		)	22,462			(48,172		)	—			(229,960		)
Income tax (benefit) expense	(25,594		)	8,535			(4,562		)	—			(21,621		)
Equity in losses of subsidiaries	(29,683		)	—			—			29,683			—
Equity in losses of joint venture	(1,426		)	—			—			—			(1,426		)
Net (loss) income	(209,765		)	13,927			(43,610		)	29,683			(209,765		)

Comprehensive (loss) income:
Foreign currency translation adjustments	(6,642		)	—			(6,642		)	6,642			(6,642		)
Change in unrecognized pension and postretirement benefit costs, net of tax	9,937			—			—			—			9,937
Other comprehensive (loss) income	3,295			—			(6,642		)	6,642			3,295
Net (loss) income	(209,765		)	13,927			(43,610		)	29,683			(209,765		)
Comprehensive (loss) income	$	(206,470	)	$	13,927		$	(50,252	)	$	36,325		$	(206,470	)

Condensed Consolidating Statement of Operations and Comprehensive (Loss) Income For the year ended December 31, 2014 (as adjusted)

	Parent			Guarantors		Non-Guarantors			Eliminations			Consolidated
Net Sales	$	609,507		$	138,165	$	243,658		$	(11,493	)	$	979,837
Costs and expenses:
Cost of materials (exclusive of depreciation and amortization)	464,069			97,981		199,851			(11,493		)	750,408
Warehouse, processing and delivery expense	101,473			11,772		27,314			—			140,559
Sales, general and administrative expense	71,659			18,303		22,503			—			112,465
Restructuring expense (income)	(3,184		)	—		224			—			(2,960		)
Depreciation and amortization expense	19,592			2,201		4,251			—			26,044
Impairment of goodwill	41,308			—		14,852			—			56,160
Total costs and expenses	694,917			130,257		268,995			(11,493		)	1,082,676
Operating (loss) income	(85,410		)	7,908		(25,337		)	—			(102,839		)
Interest expense, net	25,658			—		14,890			—			40,548
Other expense, net	—			—		4,323			—			4,323
(Loss) income before income taxes and equity in earnings (losses) of subsidiaries and joint venture	(111,068		)	7,908		(44,550		)	—			(147,710		)
Income tax (benefit) expense	(27,411		)	2,662		4,323			(205		)	(20,631		)
Equity in losses of subsidiaries	(43,422		)	—		—			43,422			—
Equity in earnings of joint venture	7,691			—		—			—			7,691
Net (loss) income	(119,388		)	5,246		(48,873		)	43,627			(119,388		)

Comprehensive (loss) income:
Foreign currency translation adjustments	(5,377		)	—		(5,377		)	5,377			(5,377		)
Change in unrecognized pension and postretirement benefit costs, net of tax	(12,996		)	—		—			—			(12,996		)
Other comprehensive loss	(18,373		)	—		(5,377		)	5,377			(18,373		)
Net (loss) income	(119,388		)	5,246		(48,873		)	43,627			(119,388		)
Comprehensive (loss) income	$	(137,761	)	$	5,246	$	(54,250	)	$	49,004		$	(137,761	)

Condensed Consolidating Statement of Operations and Comprehensive (Loss) Income For the year ended December 31, 2013 (as adjusted)

	Parent			Guarantors		Non-Guarantors			Eliminations			Consolidated
Net Sales	$	711,942		$	134,768	$	236,714		$	(30,358	)	$	1,053,066
Costs and expenses:
Cost of materials (exclusive of depreciation and amortization)	536,926			95,953		185,605			(30,358		)	788,126
Warehouse, processing and delivery expense	104,897			12,104		23,933			—			140,934
Sales, general and administrative expense	72,060			18,195		23,150			—			113,405
Restructuring expense (income)	7,006			—		1,997			—			9,003
Depreciation and amortization expense	19,977			2,154		4,057			—			26,188
Total costs and expenses	740,866			128,406		238,742			(30,358		)	1,077,656
Operating income (loss)	(28,924		)	6,362		(2,028		)	—			(24,590		)
Interest expense, net	25,760			—		14,782			—			40,542
Loss on extinguishment of debt	2,606			—		—			—			2,606
Other expense, net	—			—		1,924			—			1,924
(Loss) income before income taxes and equity in earnings (losses) of subsidiaries and joint venture	(57,290		)	6,362		(18,734		)	—			(69,662		)
Income tax (benefit) expense	(19,708		)	2,349		(5,783		)	—			(23,142		)
Equity in losses of subsidiaries	(8,938		)	—		—			8,938			—
Equity in earnings of joint venture	6,987			—		—			—			6,987
Net (loss) income	(39,533		)	4,013		(12,951		)	8,938			(39,533		)

Comprehensive (loss) income:
Foreign currency translation adjustments	(2,295		)	—		(2,295		)	2,295			(2,295		)
Change in unrecognized pension and postretirement benefit costs, net of tax	4,623			—		—			—			4,623
Other comprehensive (loss) income	2,328			—		(2,295		)	2,295			2,328
Net (loss) income	(39,533		)	4,013		(12,951		)	8,938			(39,533		)
Comprehensive (loss) income	$	(37,205	)	$	4,013	$	(15,246	)	$	11,233		$	(37,205	)

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2015

	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating activities:
Net (loss) income	$	(209,765	)	$	13,927		$	(43,610	)	$	29,683		$	(209,765	)
Equity in losses of subsidiaries	29,683			—			—			(29,683		)	—
Adjustments to reconcile net (loss) income to cash (used in) from operating activities	174,217			(8,590		)	22,005			—			187,632
Net cash (used in) from operating activities	(5,865		)	5,337			(21,605		)	—			(22,133		)
Investing activities:
Capital expenditures	(4,274		)	(2,158		)	(1,818		)	—			(8,250		)
Proceeds from sale of property, plant and equipment	8,520			20,100			11			—			28,631
Net advances to subsidiaries	(5,291		)	—			—			5,291			—
Net cash from (used in) investing activities	(1,045		)	17,942			(1,807		)	5,291			20,381
Financing activities:
Proceeds from long-term debt	967,035			—			—			—			967,035
Repayments of long-term debt	(958,916		)	—			(2,046		)	—			(960,962		)
Net intercompany (repayments) borrowings	—			(24,210		)	29,501			(5,291		)	—
Other financing activities, net	(500		)	—			—			—			(500		)
Net cash from (used in) financing activities	7,619			(24,210		)	27,455			(5,291		)	5,573
Effect of exchange rate changes on cash and cash equivalents	—			—			(1,175		)	—			(1,175		)
Net change in cash and cash equivalents	709			(931		)	2,868			—			2,646
Cash and cash equivalents - beginning of year	511			977			6,966			—			8,454
Cash and cash equivalents - end of year	$	1,220		$	46		$	9,834		$	—		$	11,100

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2014 (as adjusted)

	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating activities:
Net (loss) income	$	(119,388	)	$	5,246		$	(48,873	)	$	43,627		$	(119,388	)
Equity in losses of subsidiaries	43,422			—			—			(43,422		)	—
Adjustments to reconcile net (loss) income to cash from (used in) operating activities	35,682			(266		)	9,100			(205		)	44,311
Net cash (used in) from operating activities	(40,284		)	4,980			(39,773		)	—			(75,077		)
Investing activities:
Capital expenditures	(5,642		)	(1,530		)	(5,179		)	—			(12,351		)
Proceeds from sale of property, plant and equipment	7,464			—			—			—			7,464
Net advances to subsidiaries	(25,941		)	—			—			25,941			—
Net cash used in investing activities	(24,119		)	(1,530		)	(5,179		)	25,941			(4,887		)
Financing activities:
Proceeds from long-term debt	459,406			—			2,998			—			462,404
Repayments of long-term debt	(402,774		)	—			(1,037		)	—			(403,811		)
Net intercompany (repayments) borrowings	—			(2,968		)	28,909			(25,941		)	—
Other financing activities, net	(393		)	—			—			—			(393		)
Net cash from (used in) financing activities	56,239			(2,968		)	30,870			(25,941		)	58,200
Effect of exchange rate changes on cash and cash equivalents	—			—			(611		)	—			(611		)
Net change in cash and cash equivalents	(8,164		)	482			(14,693		)	—			(22,375		)
Cash and cash equivalents - beginning of year	8,675			495			21,659			—			30,829
Cash and cash equivalents - end of year	$	511		$	977		$	6,966		$	—		$	8,454

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2013 (as adjusted)

	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating activities:
Net (loss) income	$	(39,533	)	$	4,013		$	(12,951	)	$	8,938		$	(39,533	)
Equity in earnings of subsidiaries	8,938			—			—			(8,938		)	—
Adjustments to reconcile net (loss) income to cash from operating activities	92,236			1,298			20,384			—			113,918
Net cash from operating activities	61,641			5,311			7,433			—			74,385
Investing activities:
Capital expenditures	(6,700		)	(1,466		)	(3,438		)	—			(11,604		)
Proceeds from sale of property, plant and equipment	778			9			7			—			794
Net cash used in investing activities	(5,922		)	(1,457		)	(3,431		)	—			(10,810		)
Financing activities:
Proceeds from long-term debt	115,300			—			—			—			115,300
Repayments of long-term debt	(166,190		)	—			(4,155		)	—			(170,345		)
Net intercompany (repayments) borrowings	(1,896		)	(4,262		)	6,158			—			—
Other financing activities, net	1,636			—			(496		)	—			1,140
Net cash from (used in) financing activities	(51,150		)	(4,262		)	1,507			—			(53,905		)
Effect of exchange rate changes on cash and cash equivalents	—			—			(448		)	—			(448		)
Net change in cash and cash equivalents	4,569			(408		)	5,061			—			9,222
Cash and cash equivalents - beginning of year	4,106			903			16,598			—			21,607
Cash and cash equivalents - end of year	$	8,675		$	495		$	21,659		$	—		$	30,829