Louisiana
|
001-32360
|
72-0717400
|
(State or other
Jurisdiction of
Incorporation)
|
(Commission
File Number)
|
(I.R.S. Employer
Identification No.)
|
Exhibit No.
|
Description.
|
|
23.1
|
Consent of S. R. Batliboi & Co., independent registered public accounting firm.
|
|
99.1
|
Audited consolidated financial statements of the business acquired through the Kilitch Acquisition as of and for the nine months ended December 31, 2011.
|
|
99.2
|
Unaudited pro forma condensed combined statements of income for the year ended December 31, 2011 and six months ended June 30, 2012.
|
Akorn, Inc.
|
||
By:
|
/s/ Timothy A. Dick
|
|
Timothy A. Dick
|
||
Chief Financial Officer
|
||
S. R. BATLIBOI & CO.
Chartered Accountants
|
14th Floor, the Ruby
29 Senapati Bapat Marg
Dadar (West)
Mumbai-400 028, India
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
|||||||
Balance Sheet as at December 31, 2011
|
|||||||
Particulars
|
Notes
|
Amount (INR)
|
|||||
LIABILITIES
|
|||||||
Head Office Account
|
4 | 861,110,828 | |||||
Non-Current Liabilities
|
|||||||
Long Term Provisions
|
6 | 1,429,000 | |||||
Current Liabilities
|
|||||||
Short-Term Borrowings
|
7 | 49,283,241 | |||||
Trade Payables
|
8 | 191,767,907 | |||||
Other Current Liabilities
|
9 | 12,645,223 | |||||
Short-Term Provisions
|
6 | 31,111,958 | |||||
Total
|
1,147,348,157 | ||||||
ASSETS
|
|||||||
Non-Current Assets
|
|||||||
Fixed Assets
|
|||||||
Tangible Assets
|
10 | 260,108,239 | |||||
Capital Work in Progress
|
25 | 599,233,183 | |||||
Long term loans and advances
|
11 | 6,206,911 | |||||
Deferred Tax Assets
|
5 | 8,007,994 | |||||
Current Assets
|
|||||||
Inventories
|
12 | 105,902,761 | |||||
Trade receivables
|
13 | 144,085,505 | |||||
Cash and cash equivalents
|
14 | 601,316 | |||||
Short-term loans and advances
|
15 | 23,159,717 | |||||
Other Current Assets
|
16 | 42,531 | |||||
Total
|
1,147,348,157 | ||||||
Summary of significant accounting policies
|
3 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
|||||||
Carved out statement of Profit & Loss for the Period from April 1, 2011 to December 31, 2011
|
|||||||
Particulars
|
Notes
|
Amount (INR)
|
|||||
Revenue from operations
|
|||||||
Sale of Goods
|
837,717,086 | ||||||
Sale of Services
|
52,046,813 | ||||||
Other Operating Revenue
|
1,843,763 | ||||||
891,607,662 | |||||||
Other Income
|
17 | 3,026,798 | |||||
Total Revenue
|
894,634,460 | ||||||
Expenses:
|
|||||||
Cost of materials consumed
|
18 | 554,229,244 | |||||
Changes in inventories of finished goods and work-in-progress
|
19 | 7,764,732 | |||||
Employee Benefit Expense
|
20 | 44,714,000 | |||||
Other Expenses
|
21 | 119,328,510 | |||||
Financial Expenses
|
22 | 4,518,995 | |||||
Depreciation
|
23 | 27,539,300 | |||||
Total Expenses
|
758,094,781 | ||||||
Profit before Prior period item and tax
|
136,539,679 | ||||||
Prior Period Items
|
24 | 96,571,557 | |||||
Profit before tax
|
39,968,122 | ||||||
Tax expense:
|
|||||||
Current tax
|
29,869,958 | ||||||
Deferred tax
|
(13,313,671 | ) | |||||
Profit for the period
|
23,411,835 | ||||||
Summary of significant accounting policies
|
3 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
||||
Carved out statement of Cash Flow for the Period from April 1, 2011 to December 31, 2011
|
||||
Particulars
|
Amount (INR)
|
|||
CASH FLOW FROM OPERATING ACTIVITIES
|
||||
Net Profit Before Tax
|
39,968,122 | |||
Adjustments for:
|
||||
Depreciation
|
25,447,922 | |||
Write-off of Fixed Assets/Capital Work in Progress
|
83,884,731 | |||
Sundry Balances written-off
|
1,456,120 | |||
Interest
|
4,154,554 | |||
Provision for Gratuity & Leave Encashment
|
2,671,000 | |||
Operating Profit before Working Capital Changes
|
157,582,449 | |||
Adjustments for:
|
||||
Decrease/(Increase) in Receivables
|
(41,291,778 | ) | ||
Decrease/(Increase) in Short Term Loans & Advances
|
(14,393,369 | ) | ||
Decrease/(Increase) in Inventories
|
24,962,629 | |||
Decrease/(Increase) in Other Current Assets
|
(42,531 | ) | ||
Increase/(Decrease) in Short Term Provisions
|
29,869,958 | |||
Increase/(Decrease) in Other Current Liabilities
|
5,522,364 | |||
Increase/(Decrease) in Payables
|
77,374,906 | |||
Cash generated from operations
|
239,584,628 | |||
Net Cash flow from Operating activities
|
(A) | 239,584,628 | ||
CASH FLOW FROM INVESTING ACTIVITIES
|
||||
Additions to Fixed Assets & Capital Work in Progress
|
(211,158,120 | ) | ||
Decrease/(Increase) in Capital Advances
|
(6,206,911 | ) | ||
Net Cash used in Investing activities
|
(B) | (217,365,031 | ) | |
CASH FLOW FROM FINANCING ACTIVITIES
|
||||
Decrease/(Increase) in Head Office Account
|
(40,058,935 | ) | ||
Increase/(Decrease) in Short Term Borrowings
|
19,518,460 | |||
Interest paid
|
(4,154,554 | ) | ||
Net Cash used in financing activities
|
(C) | (24,695,029 | ) | |
Net increase in cash & Cash Equivalents
|
(A+B+C) | (2,475,432 | ) | |
Cash and Cash equivalents as at 01.04.2011
|
3,076,748 | |||
Cash and Cash equivalents as at 31.12.2011
|
601,316 |
Components of Cash & Cash Equivalents
|
As on
|
|||||||
01.04.2011 | 31.12.2011 | |||||||
Cash in Hand
|
31,639 | 361,241 | ||||||
Cash at Bank
|
3,045,109 | 240,075 | ||||||
Cash & Cash equivalents as stated ( Note 14)
|
3,076,748 | 601,316 | ||||||
Summary of significant accounting policies
|
3 | |||||||
The accompanying notes are an integral part of carved out statement of cash flows.
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
Notes forming part of the Carved-out Balance Sheet, Carved-out Statement of Profit and Loss and Carved-out Statement of Cash Flows
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
Notes forming part of the Carved-out Balance Sheet, Carved-out Statement of Profit and Loss and Carved-out Statement of Cash Flows
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
Notes forming part of the Carved-out Balance Sheet, Carved-out Statement of Profit and Loss and Carved-out Statement of Cash Flows
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
Notes forming part of the Carved-out Balance Sheet, Carved-out Statement of Profit and Loss and Carved-out Statement of Cash Flows
|
Asset Item
|
Rates (WDV)
|
|||
Factory Building
|
10.00 | % | ||
Plant and Machinery
|
13.91 | % | ||
Electric Equipments
|
13.91 | % | ||
Vehicles
|
25.89 | % | ||
Furniture and Fixture
|
18.10 | % | ||
Computer
|
40.00 | % | ||
Lab Equipments
|
13.91 | % | ||
Office Equipments (other than Mobile)
|
18.10 | % | ||
Mobile (included in office equipments)
|
40.00 | % |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
Notes forming part of the Carved-out Balance Sheet, Carved-out Statement of Profit and Loss and Carved-out Statement of Cash Flows
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
Notes forming part of the Carved-out Balance Sheet, Carved-out Statement of Profit and Loss and Carved-out Statement of Cash Flows
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
Notes forming part of the Carved-out Balance Sheet, Carved-out Statement of Profit and Loss and Carved-out Statement of Cash Flows
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
4. Head Office Account
|
||||
Particulars
|
As at December 31, 2011
Amount (INR)
|
|||
Head Office Account (this represents net assets of the Carved out business attibutable to KDL & NBZ (Refer Note 2.B)).
|
861,110,828 | |||
5. Deferred Tax Asset
|
||||
Particulars
|
As at December 31, 2011
Amount (INR)
|
|||
Fixed assets: Impact of difference between tax depreciation and depreciation/ amortization charged for the financial reporting
|
7,141,388 | |||
Provision for Employee Benefits
|
866,606 | |||
Deferred tax Asset
|
8,007,994 |
6. Provisions
|
||||||||
Particulars
|
As at December 31, 2011
Amount (INR)
|
|||||||
Long Term
|
Short Term
|
|||||||
Provision for Earned Leave
|
- | 1,190,000 | ||||||
Provision for Gratuity (Refer Note 28)
|
1,429,000 | 52,000 | ||||||
Provision for Income Tax
|
- | 29,869,958 | ||||||
Total
|
1,429,000 | 31,111,958 |
7. Short Term Borrowings
|
||||
Particulars
|
As at December 31, 2011
Amount (INR)
|
|||
Bank Overdraft
|
49,283,241 | |||
Total
|
49,283,241 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
8. Trade Payables
|
||||
Particulars
|
AS at December 31, 2011
Amount (INR)
|
|||
Dues for Trade Materials
|
134,138,909 | |||
Dues for Others
|
57,628,998 | |||
Total
|
191,767,907 | |||
9. Other Current Liabilities
|
||||
Particulars
|
AS at December 31, 2011
Amount (INR)
|
|||
Advances from Customers
|
4,121,035 | |||
Provision for Expenses
|
2,883,358 | |||
Statutory Dues
|
544,108 | |||
Dues to Employees
|
5,096,722 | |||
Total
|
12,645,223 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
10. Fixed Assets
|
||||||||||||||||
Particulars
|
GROSS BLOCK
|
|||||||||||||||
As at
01.04.2011
|
Additions
|
Adjustments
(Refer Note 24)
|
As at
31.12.2011
|
|||||||||||||
Land
|
19,685,629 | - | 1,722,991 | 17,962,638 | ||||||||||||
Factory Building
|
206,685,864 | - | 38,990,011 | 167,695,853 | ||||||||||||
Plant and Machinery
|
263,491,349 | - | 19,181,141 | 244,310,208 | ||||||||||||
Electric Equipments
|
19,543,043 | - | 1,913,362 | 17,629,681 | ||||||||||||
Vehicles
|
4,004,466 | - | 329,675 | 3,674,791 | ||||||||||||
Furniture and Fixture
|
13,120,250 | 69,375 | 2,554,492 | 10,635,133 | ||||||||||||
Computer
|
5,204,607 | 106,139 | 363,609 | 4,947,137 | ||||||||||||
Lab Equipments
|
3,044,857 | - | 348,893 | 2,695,964 | ||||||||||||
Office Equipments
|
6,746,314 | 100,600 | 740,222 | 6,106,692 | ||||||||||||
Total
|
541,526,379 | 276,114 | 66,144,396 | 475,658,097 | ||||||||||||
Particulars
|
DEPRECIATION
|
|||||||||||||||
Up to
|
For the
|
Adjustments
|
Up to
|
|||||||||||||
01.04.2011 |
Period
|
(Refer Note 24) | 31.12.2011 | |||||||||||||
Land
|
- | - | - | - | ||||||||||||
Factory Building
|
75,673,087 | 7,847,103 | 12,605,278 | 70,914,912 | ||||||||||||
Plant and Machinery
|
111,559,489 | 14,816,866 | 9,275,315 | 117,101,040 | ||||||||||||
Electric Equipments
|
9,355,791 | 959,699 | 925,233 | 9,390,258 | ||||||||||||
Vehicles
|
2,752,077 | 223,023 | 241,302 | 2,736,798 | ||||||||||||
Furniture and Fixture
|
6,908,918 | 700,174 | 1,458,147 | 6,150,945 | ||||||||||||
Computer
|
3,926,589 | 386,803 | 324,593 | 3,988,799 | ||||||||||||
Lab Equipments
|
1,472,196 | 145,270 | 168,712 | 1,448,753 | ||||||||||||
Office Equipments
|
3,885,479 | 365,984 | 433,110 | 3,818,353 | ||||||||||||
Total
|
215,533,626 | 25,447,923 | 25,431,690 | 215,549,858 | ||||||||||||
Particulars
|
NET BLOCK
|
|||||||||||||||
As at
31.12.2011
|
As at
01.04.2011
|
|||||||||||||||
Land
|
17,962,638 | 19,685,629 | ||||||||||||||
Factory Building
|
96,780,941 | 131,012,777 | ||||||||||||||
Plant and Machinery
|
127,209,168 | 151,931,860 | ||||||||||||||
Electric Equipments
|
8,239,424 | 10,187,252 | ||||||||||||||
Vehicles
|
937,993 | 1,252,389 | ||||||||||||||
Furniture and Fixture
|
4,484,188 | 6,211,332 | ||||||||||||||
Computer
|
958,338 | 1,278,018 | ||||||||||||||
Lab Equipments
|
1,247,210 | 1,572,661 | ||||||||||||||
Office Equipments
|
2,288,339 | 2,860,835 | ||||||||||||||
Total
|
260,108,239 | 325,992,753 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
11. Long Term Loans & Advances
|
||||
Particulars
|
As at December 31, 2011
Amount (INR)
|
|||
Capital Advances
|
||||
(Unsecured, Considered Good)
|
6,206,911 | |||
Total
|
6,206,911 | |||
12. Inventories (valued at lower of cost or NRV)
|
||||
Particulars
|
As at December 31, 2011
Amount (INR)
|
|||
Raw Materials
|
55,108,654 | |||
Work in Progress
|
12,797,539 | |||
Finished Goods
|
14,431,238 | |||
Consumables
|
6,052,500 | |||
Packing Materials
|
17,512,830 | |||
Total
|
105,902,761 |
Particulars
|
As at December 31, 2011
Amount (INR)
|
|||
Outstanding for more than six months from the due date
|
14,036,668 | |||
Others
|
130,048,837 | |||
Total
|
144,085,505 |
Particulars
|
As at December 31, 2011
Amount (INR)
|
|||
Cash-in-Hand
|
||||
Cash Balance
|
361,241 | |||
Bank Balance
|
||||
On Current Accounts
|
140,075 | |||
Fixed Deposits (pledged with the Sales Tax Authorities)
|
100,000 | |||
Total
|
601,316 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
Particulars
|
As at December 31, 2011
Amount (INR)
|
|||
Advance to Suppliers
|
22,378,028 | |||
Advances to Staff
|
33,451 | |||
Advances to others
|
748,238 | |||
Total
|
23,159,717 |
Particulars
|
As at December 31, 2011
Amount (INR)
|
|||
Interest Accrued but not received on Fixed Deposits
|
42,531 | |||
Total
|
42,531 |
17. Other Income
|
||||
Particulars
|
For period April 1, 2011 to December 31, 2011
Amount (INR)
|
|||
Foreign Currency Exchange Gain (Net)
|
2,984,267 | |||
Interest Income on Fixed deposits
|
42,531 | |||
Total
|
3,026,798 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
18. Cost of Materials Consumed
|
||||||||
Particulars
|
For period April 1, 2011 to December 31, 2011
Amount (INR)
|
|||||||
Raw Materials
|
||||||||
Opening Stock
|
97,378,801 | |||||||
Add: Purchases
|
438,167,040 | |||||||
Less Closing Stock
|
55,108,654 | 480,437,187 | ||||||
Packing Materials
|
||||||||
Opening Stock
|
15,150,368 | |||||||
Add: Purchases
|
76,154,519 | |||||||
Less Closing Stock
|
17,512,830 | 73,792,057 | ||||||
Total
|
554,229,244 |
19. Change in Inventories of finished goods and work-in
|
||||
Particulars
|
For period April 1, 2011 to December 31, 2011
Amount (INR)
|
|||
Inventories at the end of the year
|
||||
Finished Goods
|
14,431,238 | |||
Work in progress
|
12,797,539 | |||
Consumables
|
6,052,500 | |||
33,281,277 | ||||
Inventories at the beginning of the year
|
||||
Finished Goods
|
12,771,270 | |||
Work in progress
|
26,624,739 | |||
Consumables
|
1,650,000 | |||
41,046,009 | ||||
7,764,732 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
For period April 1, 2011 to
|
||||
Particulars
|
December 31, 2011
|
|||
Amount (INR)
|
||||
Salary, Wages & Bonus
|
27,623,499 | |||
Contribution to Provident & Other Funds
|
1,102,072 | |||
Labour Charges
|
14,625,141 | |||
Staff Welfare
|
890,288 | |||
Gratuity (Refer Note 28)
|
284,000 | |||
Leave Encashment
|
189,000 | |||
Total
|
44,714,000 |
For period April 1, 2011 to
|
||||
Particulars
|
December 31, 2011
|
|||
Amount (INR)
|
||||
Factory Consumables
|
10,684,974 | |||
Processing Charges
|
6,089,052 | |||
Lab Consumable/Analytical Charges
|
4,729,402 | |||
Packing Charges
|
16,294,032 | |||
Power & Fuel Expenses
|
50,418,426 | |||
Repair & Maintenance Expenses
|
5,693,273 | |||
Travelling Expenses
|
3,407,794 | |||
Consultancy Charges
|
4,318,092 | |||
Director's Remuneration
|
632,250 | |||
Advertisement Expenses
|
365,818 | |||
Business & Promotion and other selling expenses
|
1,953,019 | |||
Freight Outward expenses
|
464,368 | |||
Sundry Balances written off
|
1,456,120 | |||
Miscellaneous Expenses
|
12,821,890 | |||
Total
|
119,328,510 |
For period April 1, 2011 to
|
||||
Particulars
|
December 31, 2011
|
|||
Amount (INR)
|
||||
Interest on Overdraft
|
4,154,554 | |||
Bank Charges / Commission
|
364,441 | |||
Total
|
4,518,995 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
23. Depreciation
|
||||
Particulars
|
For period April 1, 2011 to December 31, 2011
Amount (INR)
|
|||
Depreciation on Tangible Assets :
|
||||
On Fixed assets Pertaining to unit of Paonta Sahib ( Refer Note - 10)
|
25,447,922 | |||
Allocation of Depreciation for Mumbai division of KDL & NBZ
|
2,091,378 | |||
Total
|
27,539,300 |
24. Prior Period Items
|
||||
Particulars
|
For period April 1, 2011 to December 31, 2011
Amount (INR)
|
|||
Fixed Assets and Capital Work-in-Progress Written Off (Refer Note - 1 below)
|
83,884,731 | |||
Opening Inventory Adjustment (Refer Note - 2 below)
|
8,734,205 | |||
Provision for Employee Benefits (Refer Note - 3 below)
|
2,198,000 | |||
Other Prior Period Expenses (Refer Note - 4 below)
|
1,754,621 | |||
Total
|
96,571,557 |
Note :
|
|||
1. During the current year, the Management has decided to write off certain items of fixed assets (which has written down value of Rs. 40,712,706) and capital work-in-progress (of Rs. 43,172,025) which had been capitalized earlier due to lack of adequate supporting documents/working available as of date. Hence, the expenses incurred have been charged to the profit and loss statement at the written down values of these assets as at April 01, 2011 and shown as prior period items.
|
|||
2. During the current year, the management has observed few errors in valuation of opening inventory of work in progress and finished goods as of April 1, 2011. The Company has corrected these errors and revalued this to INR 3,93,96,009 as against INR 4,81,30,214 as valued earlier, based on principles of Accounting Standard 2 - "Valuation of Inventories". The difference of INR 87,34,205 is shown as Prior Period Expenses.
|
|||
3. Prior to April 1, 2011 the carved out business used to account for employee benefits as and when these were paid. This practice has been changed w.e.f April 1, 2011 to provide for these employee benefit obligations as per actuarial valuation as required by Accounting Standard 15 - "Employee Benefits". Provision made for opening liability as on April 1, 2011 has been shown as a Prior Period Expense.
|
|||
4. Other prior period expenses consist of expenses pertaining to prior period booked in the current period from April 1, 2011 to December 31, 2011.
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
25. Capital Work in Progress ('CWIP')
|
||||||||||||||
Opening Balance (INR) as at
April 1, 2011
|
Additions during the
period (INR)
|
Adjustment
(Refer Note 24 (1))
|
Closing Balance (INR)
as at December 31, 2011
|
|||||||||||
431,523,202 | 210,882,006 | (43,172,025 | ) | 599,233,183 |
Particulars
|
As at
December 31, 2011
Amount (INR)
|
|||
Consumption of stores and spares
|
8,021,104 | |||
Miscellaneous Expenses
|
9,378,036 | |||
Total
|
17,399,140 |
26. Capital Commitments
|
||||
As at December 31, 2011 an amount of INR 78,587,225 is remaining to be executed on Capital Account. These Capital Commitments relate to Plant & Machinery and Building expansion.
|
||||
27. Contingent Liabilities
|
||||
1. The Paonta Sahib Unit part of carved out business imports Plant & Machinery at a concessional rate of duty against EPCG licenses. However, the carved out business needs to export a minimum value of goods within eight years in order to continue enjoying the benefit of concessional duty. If this minimum value of goods is not exported within the specified period, the carved out business will have to pay the amount of duty saved to the government, along with interest and penalty. The carved out business so far has 26 Licenses against which imports have been made but export commitments have not been fulfilled. The total amount of duty saved on these licenses is INR 146,017,742.
|
||||
The export commitments of 3 of these 26 licenses, on which duty worth INR 39,051,351 has been saved have been fulfilled in January, 2012 and the submission to the authorities were made in January, 2012. The management is confident of fulfilling these obligations and hence these obligations are not considered as probable.
|
||||
2. There are three court cases which the carved out business is involved in. In case of full liabilities mature, these would amount to INR 1,307,525. The nature of these cases is as below :
|
||||
(i) Civil Suite for recovery amounting to INR 1,199,175 pending at High court.
|
||||
(ii) Two workmen compensation cases amounting to INR 108,350 pending at District divisional court and State Labour court respectively.
|
||||
The management believes that it is possible, but not probable, the action will succeed and accordingly no provision has been recognized in the financial statements.
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
28. Gratuity
|
The company operates a defined plan, viz., gratuity, for its employees. Under the gratuity plan, every employee who has completed at least five years of service gets a gratuity on departure as 15 days of last drawn salary for each completed year of service. The scheme is not funded.
|
Under the leave encashment scheme, the company allows its employees to carry forward up to a maximum of 30 earned leaves to the next financial year, while the remaining leaves are paid in cash to the employee at the year end. The plan is not funded by the company.
|
The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the respective plans.
|
GRATUITY
|
Statement of profit and loss
|
||||
Net employee benefit expense recognized in the employee cost
|
||||
Amount (INR)
|
||||
Current service cost
|
458,000 | |||
Interest cost on benefit obligation
|
72,000 | |||
Expected return on plan assets
|
- | |||
Net actuarial( gain) / loss recognized in the year
|
(246,000 | ) | ||
Net benefit expense
|
284,000 | |||
Actual return on plan assets
|
- | |||
Balance sheet
|
||||
Benefit asset/ liability
|
||||
Amount (INR)
|
||||
Present value of defined benefit obligation
|
1,481,000 | |||
Fair Value of plan assets
|
- | |||
Net Assets / (Liability) recognized in the Balance Sheet
|
(1,481,000 | ) | ||
Changes in the present value of the defined benefit obligation are as follows:
|
||||
Amount (INR)
|
||||
Opening defined benefit obligation
|
1,197,000 | |||
Current service cost
|
458,000 | |||
Interest cost
|
72,000 | |||
Actuarial (gains) / losses on obligation
|
(246,000 | ) | ||
Closing defined benefit obligation
|
1,481,000 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
The principal assumptions used in determining gratuity and post-employment medical benefit obligations for the company’s plans are shown below:
|
||||
Amount
|
||||
Discount rate as on April 01, 2011
|
8.00 | % | ||
Discount rate as on December 31, 2011
|
8.50 | % | ||
Expected rate of return on assets
|
NA
|
|||
Salary Escalation Rate
|
12.00 | % | ||
Mortality Rate
|
LIC (1994-96)
|
|||
Ultimate | ||||
Withdrawal Rate
|
10.00 | % |
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.
|
29. Related party disclosures
|
|
(a) Names of related parties and related party relationship
|
|
I. Significant Control exists
|
|
Subsidiary of KDL
|
Eyecare Kilitch Limited
|
II. Other
|
|
Entity having significant influence on KDL
|
NBZ Pharma Limited
|
Director of KDL
|
Mr. Paresh Mehta
|
Director of KDL
|
Mr. Mukund Mehta
|
Enterprises owned or significantly influenced by key management personnel of KDL or their relatives
|
J.D.Enterprises
|
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
(b) Related party transactions
|
||||||||||||||||
The following table provides the total amount of transactions that have been entered into with related
|
||||||||||||||||
parties during the period April 1, 2011 to December 31, 2011.
|
||||||||||||||||
Sale/ purchase of goods and services
|
(INR) | |||||||||||||||
Sale of
services
|
Purchase of
goods
|
Amount owed by related parties
|
Amount owed
to related parties
|
|||||||||||||
Eyecare Kilitch Limited
|
5,383,627 | - | 982,030 | - | ||||||||||||
NBZ Pharma Limited
|
- | 5,567,876 | - | - | ||||||||||||
J.D.Enterprises
|
- | 69,409,251 | - | 16,607,080 | ||||||||||||
Other - Directors Remunerations
|
(INR)
|
|||||||||||||||
Mr. Paresh Mehta
|
316,125 | |||||||||||||||
Mr. Bhavin Mehta
|
316,125 |
An amount of INR 446,170 is payable to the Mr Paresh Mehta on account of routine business expenses incurred by him.
|
30. Segment
|
The operations of the Carved out business represent a single primary business segment relating to pharmaceuticals.
|
31. Un-hedged Foreign Currency Exposure :
|
The Carved out business have not entered any of the derivative instrument for hedging of future receivable or payable.
|
Particulars of un-hedged foreign Currency exposure as at Balance sheet date
|
Particulars
|
Foreign
|
Amount
|
Amount
|
||||||
Currency |
Foreign Currency
|
INR
|
|||||||
Trade Payables
|
USD
|
117,416 | 6,254,272 | ||||||
Advance to Suppliers
|
USD
|
250,334 | 13,335,284 | ||||||
Advance from customers
|
USD
|
83,539 | 4,450,104 | ||||||
Trade Receivables
|
USD
|
211,602 | 11,272,013 | ||||||
Trade Receivables
|
Euro
|
191,073 | 13,164,931 |
Carved-out business of Kilitch Drugs (India) Limited & NBZ Pharma Limited
|
AKORN, INC. & SUBSIDIARIES
|
|||||||||||||||||||||
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME
|
|||||||||||||||||||||
YEAR ENDED DECEMBER 31, 2011
|
|||||||||||||||||||||
(IN THOUSANDS, EXCEPT PER SHARE DATA)
|
|||||||||||||||||||||
Akorn Inc. &
|
Kilitch Carve-out
|
Pro Forma
|
|||||||||||||||||||
Subsidiaries
|
Business (a)
|
Adjustments
|
Notes
|
Pro Forma
|
|||||||||||||||||
Revenues
|
$ | 136,920 | $ | 25,507 | $ | - | $ | 162,427 | |||||||||||||
Cost of sales
|
57,231 | 16,077 | - | 73,308 | |||||||||||||||||
GROSS PROFIT
|
79,689 | 9,429 | - | 89,118 | |||||||||||||||||
Selling, general and administrative expenses
|
33,135 | 5,491 | (190 | ) | (1) | 38,436 | |||||||||||||||
Acquisition-related costs
|
- | - | 9,141 | (2) | 9,141 | ||||||||||||||||
Research and development expense
|
11,555 | - | - | 11,555 | |||||||||||||||||
Amortization of intangible assets
|
1,733 | - | 1,384 | (3) | 3,117 | ||||||||||||||||
TOTAL OPERATING EXPENSES
|
46,423 | 5,491 | 10,335 | 62,249 | |||||||||||||||||
OPERATING INCOME
|
33,266 | 3,938 | (10,335 | ) | 26,870 | ||||||||||||||||
Amortization of deferred financing costs
|
(1,948 | ) | - | (282 | ) | (4) | (2,230 | ) | |||||||||||||
Non-cash interest expense
|
(2,109 | ) | - | (1,562 | ) | (4) | (3,671 | ) | |||||||||||||
Interest expense, net
|
(2,283 | ) | (119 | ) | (1,750 | ) | (4) | (4,152 | ) | ||||||||||||
Equity in earnings of unconsolidated joint venture
|
14,550 | - | - | 14,550 | |||||||||||||||||
Other non-operating expenses
|
(170 | ) | (2,676 | ) | 2,072 | (5) | (774 | ) | |||||||||||||
INOCOME (LOSS) BEFORE INCOME TAXES
|
41,306 | 1,143 | (11,857 | ) | 30,593 | ||||||||||||||||
Income tax (benefit) provision
|
(1,707 | ) | 474 | (2,280 | ) | (6) | (3,514 | ) | |||||||||||||
NET INCOME (LOSS)
|
$ | 43,013 | 670 | (9,577 | ) | 34,106 | |||||||||||||||
NET INCOME (LOSS) PER SHARE:
|
|||||||||||||||||||||
BASIC
|
$ | 0.45 | $ | 0.36 | |||||||||||||||||
DILUTED
|
$ | 0.41 | $ | 0.33 | |||||||||||||||||
SHARES USED IN COMPUTING NET INCOME (LOSS)
|
|||||||||||||||||||||
PER COMMON SHARE:
|
|||||||||||||||||||||
BASIC
|
94,549 | 94,549 | |||||||||||||||||||
DILUTED
|
103,912 | 103,912 | |||||||||||||||||||
(a)
|
The Kilitch Carve-out Business income statement figures for the year ended December 31, 2011 were derived by annualizing its nine-month results for the nine month period ended December 31, 2011.
|
||||||||||||||||||||
See notes to the unaudited pro forma condensed combined statements of income.
|
AKORN, INC. & SUBSIDIARIES
|
|||||||||||||||||||||
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME
|
|||||||||||||||||||||
SIX MONTHS ENDED JUNE 30, 2012
|
|||||||||||||||||||||
(IN THOUSANDS, EXCEPT PER SHARE DATA)
|
|||||||||||||||||||||
Akorn Inc. &
|
Kilitch Carve-out
|
Pro Forma
|
|||||||||||||||||||
Subsidiaries
|
Business (a)
|
Adjustments
|
Notes
|
Pro Forma
|
|||||||||||||||||
Revenues
|
$ | 115,004 | $ | 3,401 | $ | - | $ | 118,405 | |||||||||||||
Cost of sales
|
48,376 | 1,804 | - | 50,180 | |||||||||||||||||
GROSS PROFIT
|
66,628 | 1,597 | - | 68,225 | |||||||||||||||||
Selling, general and administrative expenses
|
21,279 | 266 | - | 21,545 | |||||||||||||||||
Acquisition-related costs
|
8,644 | - | (8,324 | ) | (2) | 320 | |||||||||||||||
Research and development expense
|
6,950 | - | - | 6,950 | |||||||||||||||||
Amortization of intangible assets
|
3,317 | 204 | - | 3,521 | |||||||||||||||||
TOTAL OPERATING EXPENSES
|
40,190 | 471 | (8,324 | ) | 32,337 | ||||||||||||||||
OPERATING INCOME
|
26,438 | 1,126 | 8,324 | 35,888 | |||||||||||||||||
Amortization of deferred financing costs
|
(388 | ) | - | (10 | ) | (4) | (398 | ) | |||||||||||||
Non-cash interest expense
|
(2,387 | ) | - | (57 | ) | (4) | (2,444 | ) | |||||||||||||
Interest expense, net
|
(2,050 | ) | 22 | (35 | ) | (4) | (2,063 | ) | |||||||||||||
Other non-operating expenses
|
- | 2 | - | 2 | |||||||||||||||||
INOCOME (LOSS) BEFORE INCOME TAXES
|
21,613 | 1,150 | 8,222 | 30,985 | |||||||||||||||||
Income tax (benefit) provision
|
8,799 | 261 | 2,528 | 11,589 | |||||||||||||||||
NET INCOME (LOSS)
|
$ | 12,814 | 889 | 5,694 | 19,397 | ||||||||||||||||
NET INCOME (LOSS) PER SHARE:
|
|||||||||||||||||||||
BASIC
|
$ | 0.13 | $ | 0.20 | |||||||||||||||||
DILUTED
|
$ | 0.12 | $ | 0.18 | |||||||||||||||||
SHARES USED IN COMPUTING NET INCOME (LOSS)
|
|||||||||||||||||||||
PER COMMON SHARE:
|
|||||||||||||||||||||
BASIC
|
95,096 | 95,096 | |||||||||||||||||||
DILUTED
|
110,513 | 110,513 | |||||||||||||||||||
(a)
|
Represents January & February 2012 pro forma operating results for the Kilitch Carve-out Business as estimated based on its actual results for the four months ended June 30, 2012, net of certain pro forma adjustments related to acquisition-related costs.
|
||||||||||||||||||||
See notes to the unaudited pro forma condensed combined statements of income.
|
1.
|
BASIS OF PRESENTATION
|
2.
|
NOTES TO UNAUDITED PRO FORMA ADJUSTMENTS
|
Year ended
December 31, 2011
|
Six months ended
June 30, 2012
|
|||||||||||||||||||||||
Akorn Inc
and Subs
|
Pro forma
adjustments
|
Pro forma
|
Akorn Inc
and Subs
|
Pro forma
adjustment
|
Pro forma
|
|||||||||||||||||||
Amortization of deferred financing costs
|
$ | 382 | $ | 282 | $ | 664 | $ | 340 | $ | 10 | $ | 350 | ||||||||||||
Non-cash interest expense
|
$ | 2,109 | $ | 1,562 | $ | 3,671 | $ | 1,880 | $ | 57 | $ | 1,937 | ||||||||||||
Interest expense, net
|
$ | 2,450 | $ | 1,750 | $ | 4,200 | $ | 2,100 | $ | — | $ | 2,100 |