Guarantor Subsidiaries (Tables)

3 Months Ended

Mar. 31, 2015

Summary Consolidating Statements of Income (Guaranteed Senior Notes Payable)

Summary Consolidating

Statements of Comprehensive Income (Loss)

(in thousands)



	Three months ended March 31,
2015:	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating / Eliminating Adjustments			Omnicare, Inc. and Subsidiaries
Net sales	$	—		$	1,627,819		$	32,023	$	—		$	1,659,842
Cost of sales	—			1,289,350			21,029		—			1,310,379
Gross profit	—			338,469			10,994		—			349,463
Selling, general and administrative expenses	828			162,577			4,018		—			167,423
Provision for doubtful accounts	—			18,892			299		—			19,191
Settlement, litigation and other related charges	—			9,820			—		—			9,820
Other charges	—			1,049			—		—			1,049
Operating (loss) income	(828		)	146,131			6,677		—			151,980
Interest expense, net of investment income	(27,422		)	(227		)	—		—			(27,649		)
(Loss) income before income taxes	(28,250		)	145,904			6,677		—			124,331
Income tax (benefit) expense	(10,859		)	55,234			2,567		—			46,942
(Loss) income from continuing operations	(17,391		)	90,670			4,110		—			77,389
Loss from discontinued operations	—			—			—		—			—
Equity of net income of subsidiaries	94,780			—			—		(94,780		)	—
Net income (loss)	$	77,389		$	90,670		$	4,110	$	(94,780	)	$	77,389
Comprehensive income (loss)	$	77,539		$	90,670		$	4,110	$	(94,780	)	$	77,539
2014:
Net sales	$	—		$	1,540,006		$	31,032	$	—		$	1,571,038
Cost of sales	—			1,194,399			18,185		—			1,212,584
Gross profit	—			345,607			12,847		—			358,454
Selling, general and administrative expenses	987			182,120			3,706		—			186,813
Provision for doubtful accounts	—			21,047			514		—			21,561
Settlement, litigation and other related charges	—			7,052			—		—			7,052
Other charges	—			10,276			—		—			10,276
Operating (loss) income	(987		)	125,112			8,627		—			132,752
Interest expense, net of investment income	(29,156		)	(285		)	—		—			(29,441		)
(Loss) income before income taxes	(30,143		)	124,827			8,627		—			103,311
Income tax (benefit) expense	(11,671		)	48,004			3,340		—			39,673
(Loss) income from continuing operations	(18,472		)	76,823			5,287		—			63,638
Income (loss) from discontinued operations	—			(267		)	403		—			136
Equity of net income (loss) of subsidiaries	88,246			—			—		(88,246		)	—
Net income (loss)	$	69,774		$	76,556		$	5,690	$	(88,246	)	$	63,774
Comprehensive income	$	63,997		$	82,556		$	5,690	$	(88,246	)	$	63,997

Condensed Consolidating Balance Sheets (Guaranteed Senior Notes Payable)

Condensed Consolidating Balance Sheets

(in thousands)



As of March 31, 2015	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating/Eliminating Adjustments			Omnicare, Inc. and Subsidiaries
ASSETS
Cash and cash equivalents	$	279,669	$	25,555	$	17,269	$	—		$	322,493
Accounts receivable, net (including intercompany)	—		631,476		160,678		(159,548		)	632,606
Inventories	—		457,174		6,738		—			463,912
Deferred income tax benefits, net-current	—		60,022		583		(378		)	60,227
Other current assets	2,956		167,394		31,334		—			201,684
Total current assets	282,625		1,341,621		216,602		(159,926		)	1,680,922
Properties and equipment, net	—		263,891		4,936		—			268,827
Goodwill	—		4,036,146		28,805		—			4,064,951
Identifiable intangible assets, net	—		95,972		1,118		—			97,090
Other noncurrent assets	21,742		53,069		36		—			74,847
Investment in subsidiaries	4,723,369		—		—		(4,723,369		)	—
Total assets	$	5,027,736	$	5,790,699	$	251,497	$	(4,883,295	)	$	6,186,637
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities (including intercompany)	$	55,635	$	634,187	$	34,371	$	(159,548	)	$	564,645
Current portion of long-term debt	443,300		5,454		—		—			448,754
Current liabilities of discontinued operations	—		—		—		—			—
Long-term debt, notes and convertible debentures	1,506,569		5,747		—		—			1,512,316
Deferred income tax liabilities	348,683		594,957		—		(378		)	943,262
Other noncurrent liabilities	—		42,382		1,729		—			44,111
Convertible debt	148,334		—		—		—			148,334
Stockholders’ equity	2,525,215		4,507,972		215,397		(4,723,369		)	2,525,215
Total liabilities and stockholders’ equity	$	5,027,736	$	5,790,699	$	251,497	$	(4,883,295	)	$	6,186,637
As of December 31, 2014
ASSETS
Cash and cash equivalents	$	113,072	$	26,865	$	13,862	$	—		$	153,799
Accounts receivable, net (including intercompany)	—		576,151		100,046		(97,436		)	578,761
Inventories	—		511,840		7,744		—			519,584
Deferred income tax benefits, net-current	—		58,988		432		(220		)	59,200
Other current assets	2,287		256,106		29,167		—			287,560
Total current assets	115,359		1,429,950		151,251		(97,656		)	1,598,904
Properties and equipment, net	—		262,689		5,064		—			267,753
Goodwill	—		4,033,001		28,805		—			4,061,806
Identifiable intangible assets, net	—		97,613		1,329		—			98,942
Other noncurrent assets	21,717		58,629		39		—			80,385
Investment in subsidiaries	4,931,821		—		—		(4,931,821		)	—
Total assets	$	5,068,897	$	5,881,882	$	186,488	$	(5,029,477	)	$	6,107,790
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities (including intercompany)	$	27,725	$	459,808	$	30,817	$	(97,436	)	$	420,914
Current portion of long-term debt	446,717		—		—		—			446,717
Long-term debt, notes and convertible debentures	1,510,212		7,347		—		—			1,517,559
Deferred income tax liabilities	343,816		592,651		—		(220		)	936,247
Other noncurrent liabilities	—		44,228		1,698		—			45,926
Convertible debt	151,706		—		—		—			151,706
Stockholders’ equity	2,588,721		4,777,848		153,973		(4,931,821		)	2,588,721
Total liabilities and stockholders’ equity	$	5,068,897	$	5,881,882	$	186,488	$	(5,029,477	)	$	6,107,790

Condensed Consolidating Statements of Cash Flows (Guaranteed Senior Notes Payable)

Condensed Consolidating Statements of Cash Flows

(in thousands)



	Three months ended March 31,
2015:	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Omnicare, Inc. and Subsidiaries
Cash flows from operating activities:
Net cash flows from operating activities	$	(1,299	)	$	334,047		$	3,508		$	336,256
Cash flows from investing activities:
Acquisition of businesses, net of cash received	—			(9,328		)	—			(9,328		)
Capital expenditures	—			(13,372		)	(101		)	(13,473		)
Net cash flows used in investing activities	—			(22,700		)	(101		)	(22,801		)
Cash flows from financing activities:
Payments on terms loans	(5,000		)	—			—			(5,000		)
Payments on long-term borrowings and obligations	(2,385		)	—			—			(2,385		)
Fees paid for financing activities	(1,977		)	—			—			(1,977		)
Decrease in cash overdraft balance	12,574			1,160			—			13,734
Payments for Omnicare common stock repurchase	(125,000		)	—			—			(125,000		)
Dividends paid	(21,171		)	—			—			(21,171		)
Other	310,855			(313,817		)	—			(2,962		)
Net cash flows from (used in) financing activities	167,896			(312,657		)	—			(144,761		)
Net increase (decrease) in cash and cash equivalents	166,597			(1,310		)	3,407			168,694
Increase (decrease) from discontinued operations	—			—			—			—
Net increase (decrease) from continuing operations	166,597			(1,310		)	3,407			168,694
Cash and cash equivalents at beginning of period	113,072			26,865			13,862			153,799
Cash and cash equivalents at end of period	$	279,669		$	25,555		$	17,269		$	322,493
2014:
Cash flows from operating activities:
Net cash flows (used in) from operating activities	$	(1,854	)	$	178,130		$	1,222		$	177,498
Cash flows from investing activities:
Divestiture of business, net	—			3,629			—			3,629
Capital expenditures	—			(25,702		)	(463		)	(26,165		)
Other	—			(5		)	(279		)	(284		)
Net cash flows used in investing activities	—			(22,078		)	(742		)	(22,820		)
Cash flows from financing activities:
Payments on term loans	(5,313		)	—			—			(5,313		)
Payments on long-term borrowings and obligations	(39,030		)	—			—			(39,030		)
Decrease in cash overdraft balance	(2,611		)	(926		)	—			(3,537		)
Payments for Omnicare common stock repurchases	(95,417		)	—			—			(95,417		)
Dividends paid	(19,596		)	—			—			(19,596		)
Other	172,321			(167,504		)	—			4,817
Net cash flows from (used in) financing activities	10,354			(168,430		)	—			(158,076		)
Net increase (decrease) in cash and cash equivalents	8,500			(12,378		)	480			(3,398		)
Increase (decrease) from discontinued operations	—			5,895			(279		)	5,616
Net increase (decrease) from continuing operations	8,500			(18,273		)	759			(9,014		)
Cash and cash equivalents at beginning of period	275,910			68,050			12,041			356,001
Cash and cash equivalents at end of period	$	284,410		$	49,777		$	12,800		$	346,987

Summary Consolidating Statements of Income (Guaranteed Convertible Senior Debentures)

Summary Consolidating

Statements of Comprehensive Income (Loss)

(in thousands)



	Three months ended March 31,
2015:	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Consolidating / Eliminating Adjustments			Omnicare, Inc. and Subsidiaries
Net sales	$	—		$	—		$	1,659,842		$	—		$	1,659,842
Cost of sales	—			—			1,310,379			—			1,310,379
Gross profit	—			—			349,463			—			349,463
Selling, general and administrative expenses	828			441			166,154			—			167,423
Provision for doubtful accounts	—			—			19,191			—			19,191
Settlement, litigation and other related charges	—			—			9,820			—			9,820
Other charges	—			—			1,049			—			1,049
Operating (loss) income	(828		)	(441		)	153,249			—			151,980
Interest expense, net of investment income	(27,422		)	—			(227		)	—			(27,649		)
(Loss) income before income taxes	(28,250		)	(441		)	153,022			—			124,331
Income tax (benefit) expense	(10,859		)	(170		)	57,971			—			46,942
(Loss) income from continuing operations	(17,391		)	(271		)	95,051			—			77,389
Loss from discontinued operations	—			—			—			—			—
Equity of net income of subsidiaries	94,780			—			—			(94,780		)	—
Net income (loss)	$	77,389		$	(271	)	$	95,051		$	(94,780	)	$	77,389
Comprehensive income (loss)	$	77,539		$	(271	)	$	95,051		$	(94,780	)	$	77,539
2014:
Net sales	$	—		$	—		$	1,571,038		$	—		$	1,571,038
Cost of sales	—			—			1,212,584			—			1,212,584
Gross profit	—			—			358,454			—			358,454
Selling, general and administrative expenses	987			436			185,390			—			186,813
Provision for doubtful accounts	—			—			21,561			—			21,561
Settlement, litigation and other related charges	—			—			7,052			—			7,052
Other charges	—			—			10,276			—			10,276
Operating (loss) income	(987		)	(436		)	134,175			—			132,752
Interest expense, net of investment income	(29,156		)	—			(285		)	—			(29,441		)
(Loss) income before income taxes	(30,143		)	(436		)	133,890			—			103,311
Income tax (benefit) expense	(11,671		)	(169		)	51,513			—			39,673
(Loss) income from continuing operations	(18,472		)	(267		)	82,377			—			63,638
Income from discontinued operations	—			—			136			—			136
Equity of net income of subsidiaries	88,246			—			—			(88,246		)	—
Net income (loss)	$	69,774		$	(267	)	$	82,513		$	(88,246	)	$	63,774
Comprehensive income (loss)	$	63,997		$	(267	)	$	88,513		$	(88,246	)	$	63,997

Condensed Consolidating Balance Sheets (Guaranteed Convertible Senior Debentures)

Condensed Consolidating Balance Sheets

(in thousands)



As of March 31, 2015	Parent		Guarantor Subsidiary		Non-Guarantor Subsidiaries		Consolidating/Eliminating Adjustments			Omnicare, Inc. and Subsidiaries
ASSETS
Cash and cash equivalents	$	279,669	$	—	$	42,824	$	—		$	322,493
Accounts receivable, net (including intercompany)	—		201		632,606		(201		)	632,606
Inventories	—		—		463,912		—			463,912
Deferred income tax benefits, net-current	—		—		60,227		—			60,227
Other current assets	2,956		13		198,715		—			201,684
Total current assets	282,625		214		1,398,284		(201		)	1,680,922
Properties and equipment, net	—		10		268,817		—			268,827
Goodwill	—		—		4,064,951		—			4,064,951
Identifiable intangible assets, net	—		—		97,090		—			97,090
Other noncurrent assets	21,742		19		53,086		—			74,847
Investment in subsidiaries	4,723,369		—		—		(4,723,369		)	—
Total assets	$	5,027,736	$	243	$	5,882,228	$	(4,723,570	)	$	6,186,637
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities (including intercompany)	$	55,635	$	4	$	509,207	$	(201	)	$	564,645
Current portion of long-term debt	443,300		—		5,454		—			448,754
Long-term debt, notes and convertible debentures	1,506,569		—		5,747		—			1,512,316
Deferred income tax liabilities	348,683		—		594,579		—			943,262
Other noncurrent liabilities	—		—		44,111		—			44,111
Convertible debt	148,334		—		—		—			148,334
Stockholders’ equity	2,525,215		239		4,723,130		(4,723,369		)	2,525,215
Total liabilities and stockholders’ equity	$	5,027,736	$	243	$	5,882,228	$	(4,723,570	)	$	6,186,637
As of December 31, 2014
ASSETS
Cash and cash equivalents	$	113,072	$	—	$	40,727	$	—		$	153,799
Accounts receivable, net (including intercompany)	—		203		578,761		(203		)	578,761
Inventories	—		—		519,584		—			519,584
Deferred income tax benefits, net-current	—		—		59,200		—			59,200
Other current assets	2,287		—		285,273		—			287,560
Total current assets	115,359		203		1,483,545		(203		)	1,598,904
Properties and equipment, net	—		12		267,741		—			267,753
Goodwill	—		—		4,061,806		—			4,061,806
Identifiable intangible assets, net	—		—		98,942		—			98,942
Other noncurrent assets	21,717		19		58,649		—			80,385
Investment in subsidiaries	4,931,821		—		—		(4,931,821		)	—
Total assets	$	5,068,897	$	234	$	5,970,683	$	(4,932,024	)	$	6,107,790
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities (including intercompany)	$	27,725	$	—	$	393,392	$	(203	)	$	420,914
Current portion of long-term debt	446,717		—		—		—			446,717
Long-term debt, notes and convertible debentures	1,510,212		—		7,347		—			1,517,559
Deferred income tax liabilities	343,816		—		592,431		—			936,247
Other noncurrent liabilities	—		—		45,926		—			45,926
Convertible debt	151,706		—		—		—			151,706
Stockholders’ equity	2,588,721		234		4,931,587		(4,931,821		)	2,588,721
Total liabilities and stockholders’ equity	$	5,068,897	$	234	$	5,970,683	$	(4,932,024	)	$	6,107,790

Condensed Consolidating Statements of Cash Flows (Guaranteed Convertible Senior Debentures)

Condensed Consolidating Statements of Cash Flows

(in thousands)



	Three months ended March 31,
2015:	Parent			Guarantor Subsidiary		Non-Guarantor Subsidiaries			Omnicare, Inc. and Subsidiaries
Cash flows from operating activities:
Net cash flows from operating activities	$	(1,299	)	$	—	$	337,555		$	336,256
Cash flows from investing activities:
Acquisition of businesses, net of cash received	—			—		(9,328		)	(9,328		)
Capital expenditures	—			—		(13,473		)	(13,473		)
Net cash flows used in investing activities	—			—		(22,801		)	(22,801		)
Cash flows from financing activities:
Payments on terms loans	(5,000		)	—		—			(5,000		)
Payments on long-term borrowings and obligations	(2,385		)	—		—			(2,385		)
Fees paid for financing activities	(1,977		)	—		—			(1,977		)
Decrease in cash overdraft balance	12,574			—		1,160			13,734
Payments for Omnicare common stock repurchase	(125,000		)	—		—			(125,000		)
Dividends paid	(21,171		)	—		—			(21,171		)
Other	310,855			—		(313,817		)	(2,962		)
Net cash flows from (used in) financing activities	167,896			—		(312,657		)	(144,761		)
Net increase in cash and cash equivalents	166,597			—		2,097			168,694
Less increase in cash and cash equivalents of discontinued operations	—			—		—			—
Increase in cash and cash equivalents of continuing operations	166,597			—		2,097			168,694
Cash and cash equivalents at beginning of period	113,072			—		40,727			153,799
Cash and cash equivalents at end of period	$	279,669		$	—	$	42,824		$	322,493
2014:
Cash flows from operating activities:
Net cash flows (used in) from operating activities	$	(1,854	)	$	—	$	179,352		$	177,498
Cash flows from investing activities:
Divestiture of business, net	—			—		3,629			3,629
Capital expenditures	—			—		(26,165		)	(26,165		)
Other	—			—		(284		)	(284		)
Net cash flows used in investing activities	—			—		(22,820		)	(22,820		)
Cash flows from financing activities:
Payments on term loans	(5,313		)	—		—			(5,313		)
Payments on long-term borrowings and obligations	(39,030		)	—		—			(39,030		)
Decrease in cash overdraft balance	(2,611		)	—		(926		)	(3,537		)
Payments for Omnicare common stock repurchases	(95,417		)	—		—			(95,417		)
Dividends paid	(19,596		)	—		—			(19,596		)
Other	172,321			—		(167,504		)	4,817
Net cash flows from (used in) financing activities	10,354			—		(168,430		)	(158,076		)
Net increase (decrease) in cash and cash equivalents	8,500			—		(11,898		)	(3,398		)
Less decrease in cash and cash equivalents of discontinued operations	—			—		5,616			5,616
Increase (decrease) in cash and cash equivalents of continuing operations	8,500			—		(17,514		)	(9,014		)
Cash and cash equivalents at beginning of period	275,910			—		80,091			356,001
Cash and cash equivalents at end of period	$	284,410		$	—	$	62,577		$	346,987