Condensed Consolidating Financial Information

The Company is providing unaudited condensed consolidating financial information for its domestic subsidiaries that have guaranteed the 7 1/8% Notes, and for those subsidiaries that have not guaranteed the 7 1/8% Notes. These 100% owned subsidiary guarantors have, jointly and severally, fully and unconditionally guaranteed the 7 1/8% Notes subject to release under the following circumstances: (i) to enable the disposition of such property or assets to a party that is not the Company or a subsidiary guarantor to the extent permitted by and consummated in compliance with the indenture governing the 7 1/8% Notes; (ii) in case of a subsidiary guarantor that is released from its subsidiary guarantee, the release of the property and assets of such subsidiary guarantor; (iii) as permitted or required by the intercreditor agreement; (iv) with the consent of the holder of at least a majority in principal amount of the outstanding 7 1/8% Notes; or (v) when permitted or required by the indenture governing the 7 1/8% Notes. Prior to the consummation of the Acquisition and escrow release date, the 7 1/8% Notes were secured by a first priority security interest in the escrow account and all deposits and investment property therein. Following the consummation of the Acquisition and escrow release date on June 14, 2013, the subsidiary guarantees are a senior secured obligation of each subsidiary guarantor and rank (i) effectively junior to all of existing and future first-priority senior secured debt, including borrowings under the Senior Credit Facility, to the extent of the value of the assets securing such debt; (ii) effectively senior to all of the Company’s existing and future unsecured senior debt; (iii) senior in right of payment to all of the Company’s existing and future subordinated debt; and (iv) structurally subordinated to all existing and future liabilities of non-guarantor subsidiaries.

The Company has not presented separate financial and narrative information for each of the subsidiary guarantors, because it believes that such financial and narrative information would not provide investors with any additional information that would be material in evaluating the sufficiency of the guarantees. Therefore, the following condensed consolidating financial information summarizes the financial position, results of operations, and cash flows for the Company’s guarantor and non-guarantor subsidiaries.

The Company revised its unaudited condensed consolidating balance sheet as of November 30, 2013 and statement of cash flows for the nine months ended August 31, 2013 to correct for the misclassification of intercompany transactions between the Parent and the Guarantor Subsidiaries columns. The adjustments had no impact on the consolidated amounts previously reported.

The revision on the unaudited condensed consolidating balance sheet as of November 30, 2013 resulted in the following: (i) a decrease of $38.0 million in intercompany receivable to the Parent column and a corresponding decrease of $38.0 million in intercompany payable to the Guarantor Subsidiaries column; and (ii) a decrease of $38.0 million in other current liabilities to the Parent column and a corresponding increase of $38.0 million in other current liabilities to the Guarantor Subsidiaries column.

In addition, the revision on the unaudited condensed consolidating statement of cash flows resulted in a decrease of $9.4 million to “net cash provided by operating activities” to the Parent column for the nine months ended August 31, 2013, with a corresponding increase to “net cash provided by financing activities.” The Company also revised the Guarantor Subsidiaries column in the unaudited condensed consolidating statement of cash flows to increase “net cash provided by operating activities” by $9.4 million for the nine months ended August 31, 2013, with a corresponding decrease to “net cash provided by financing activities.”

These revisions, which the Company determined are not material to any period presented, had no impact on any financial statements or footnotes, except for the Parent and Guarantor Subsidiaries columns of the unaudited condensed consolidating balance sheet as of November 30, 2013 and the statement of cash flows for the nine months ended August 31, 2013.

Condensed Consolidating Statements of Operations and Comprehensive (Loss) Income

(Unaudited)



Three months ended August 31, 2014	Parent			Guarantor Subsidiaries		Non-guarantor Subsidiaries			Eliminations			Consolidated
	(In millions)
Net sales	$	—		$	413.7	$	5.8		$	—		$	419.5
Cost of sales (exclusive of items shown separately below)	—			369.4		4.9			(0.1		)	374.2
Selling, general and administrative	3.4			5.9		0.4			—			9.7
Depreciation and amortization	—			15.4		0.3			—			15.7
Interest expense	13.5			0.5		—			—			14.0
Other, net	9.8			7.2		(0.8		)	0.1			16.3
(Loss) income from continuing operations before income taxes	(26.7		)	15.3		1.0			—			(10.4		)
Income tax (benefit) provision	(6.2		)	4.7		0.8			—			(0.7		)
(Loss) income from continuing operations	(20.5		)	10.6		0.2			—			(9.7		)
Income from discontinued operations	0.2			—		—			—			0.2
(Loss) income before equity income of subsidiaries	(20.3		)	10.6		0.2			—			(9.5		)
Equity income of subsidiaries	10.8			—		—			(10.8		)	—
Net (loss) income	$	(9.5	)	$	10.6	$	0.2		$	(10.8	)	$	(9.5	)
Comprehensive (loss) income	$	(2.0	)	$	15.8	$	0.2		$	(16.0	)	$	(2.0	)



Three months ended August 31, 2013	Parent			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations			Consolidated
	(In millions)
Net sales	$	—		$	361.4		$	6.1		$	—		$	367.5
Cost of sales (exclusive of items shown separately below)	—			322.3			4.6			(0.2		)	326.7
Selling, general and administrative	6.6			7.1			0.4			—			14.1
Depreciation and amortization	0.1			14.8			0.3			—			15.2
Interest expense	11.8			0.6			—			—			12.4
Other, net	4.2			2.9			0.8			0.2			8.1
(Loss) income from continuing operations before income taxes	(22.7		)	13.7			—			—			(9.0		)
Income tax benefit	(63.2		)	(136.9		)	(6.5		)	—			(206.6		)
Income from continuing operations	40.5			150.6			6.5			—			197.6
Loss from discontinued operations	(0.2		)	—			—			—			(0.2		)
Income before equity income of subsidiaries	40.3			150.6			6.5			—			197.4
Equity income of subsidiaries	157.1			—			—			(157.1		)	—
Net income	$	197.4		$	150.6		$	6.5		$	(157.1	)	$	197.4
Comprehensive income	$	220.4		$	166.8		$	6.5		$	(173.3	)	$	220.4



Nine months ended August 31, 2014	Parent			Guarantor Subsidiaries		Non-guarantor Subsidiaries			Eliminations			Consolidated
	(In millions)
Net sales	$	—		$	1,133.1	$	19.2		$	—		$	1,152.3
Cost of sales (exclusive of items shown separately below)	—			1,009.8		17.8			(0.4		)	1,027.2
Selling, general and administrative	9.0			17.9		1.2			—			28.1
Depreciation and amortization	0.1			45.0		0.8			—			45.9
Interest expense	37.1			1.9		—			—			39.0
Other, net	59.3			14.4		(1.9		)	0.4			72.2
(Loss) income from continuing operations before income taxes	(105.5		)	44.1		1.3			—			(60.1		)
Income tax (benefit) provision	(16.0		)	16.2		0.9			—			1.1
(Loss) income from continuing operations	(89.5		)	27.9		0.4			—			(61.2		)
Loss from discontinued operations	(0.6		)	—		—			—			(0.6		)
(Loss) income before equity income of subsidiaries	(90.1		)	27.9		0.4			—			(61.8		)
Equity income of subsidiaries	28.3			—		—			(28.3		)	—
Net (loss) income	$	(61.8	)	$	27.9	$	0.4		$	(28.3	)	$	(61.8	)
Comprehensive (loss) income	$	(39.1	)	$	43.4	$	0.4		$	(43.8	)	$	(39.1	)



Nine months ended August 31, 2013	Parent			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations			Consolidated
	(In millions)
Net sales	$	—		$	878.8		$	19.0		$	—		$	897.8
Cost of sales (exclusive of items shown separately below)	—			784.5			14.6			(0.5		)	798.6
Selling, general and administrative	23.2			15.9			0.8			—			39.9
Depreciation and amortization	0.1			25.7			0.8			—			26.6
Interest expense	34.4			1.8			—			—			36.2
Other, net	26.9			(5.4		)	2.3			0.5			24.3
(Loss) income from continuing operations before income taxes	(84.6		)	56.3			0.5			—			(27.8		)
Income tax benefit	(75.3		)	(116.1		)	(8.2		)	—			(199.6		)
(Loss) income from continuing operations	(9.3		)	172.4			8.7			—			171.8
Loss from discontinued operations	(0.2		)	—			—			—			(0.2		)
(Loss) income before equity income of subsidiaries	(9.5		)	172.4			8.7			—			171.6
Equity income of subsidiaries	181.1			—			—			(181.1		)	—
Net income	$	171.6		$	172.4		$	8.7		$	(181.1	)	$	171.6
Comprehensive income	$	240.4		$	221.0		$	8.7		$	(229.7	)	$	240.4

Condensed Consolidating Balance Sheets

(Unaudited)



August 31, 2014	Parent			Guarantor Subsidiaries		Non-guarantor Subsidiaries		Eliminations			Consolidated
	(In millions)
Cash and cash equivalents	$	154.9		$	—	$	0.2	$	(0.2	)	$	154.9
Accounts receivable	—			213.1		1.6		—			214.7
Inventories	—			126.4		5.9		—			132.3
Recoverable from the U.S. government, Northrop, and other third parties for environmental remediation costs	0.1			26.0		—		—			26.1
Other receivables, prepaid expenses and other	3.7			22.1		0.9		—			26.7
Income taxes	25.1			—		0.4		(12.1		)	13.4
Deferred income taxes	9.1			—		—		(5.1		)	4.0
Total current assets	192.9			387.6		9.0		(17.4		)	572.1
Property, plant and equipment, net	4.7			360.1		5.8		—			370.6
Recoverable from the U.S. government and other third parties for environmental remediation costs	0.7			82.9		—		—			83.6
Deferred income taxes	52.5			108.4		19.1		—			180.0
Goodwill	—			164.4		—		—			164.4
Intercompany receivable	10.6			—		30.4		(41.0		)	—
Investments in subsidiaries	577.8			—		—		(577.8		)	—
Other noncurrent assets and intangibles, net	29.3			300.1		49.6		—			379.0
Total assets	$	868.5		$	1,403.5	$	113.9	$	(636.2	)	$	1,749.7
Short-term borrowings and current portion of long-term debt	$	5.2		$	0.3	$	—	$	—		$	5.5
Accounts payable	1.8			112.6		1.2		(0.2		)	115.4
Reserves for environmental remediation costs	2.0			33.0		—		—			35.0
Income taxes	—			12.1		—		(12.1		)	—
Other current liabilities and advance payments on contracts	41.9			298.7		3.3		(5.1		)	338.8
Postretirement medical and life insurance benefits	5.5			1.7		—		—			7.2
Total current liabilities	56.4			458.4		4.5		(17.4		)	501.9
Long-term debt	777.6			0.4		—		—			778.0
Reserves for environmental remediation costs	4.5			129.1		—		—			133.6
Pension benefits	21.3			227.0		—		—			248.3
Intercompany payable	—			41.0		—		(41.0		)	—
Postretirement medical and life insurance benefits	37.8			19.3		—		—			57.1
Other noncurrent liabilities	19.4			47.7		12.2		—			79.3
Total liabilities	917.0			922.9		16.7		(58.4		)	1,798.2
Commitments and contingencies (Note 8)
Redeemable common stock	0.2			—		—		—			0.2
Total shareholders’ (deficit) equity	(48.7		)	480.6		97.2		(577.8		)	(48.7		)
Total liabilities, redeemable common stock, and shareholders’ (deficit) equity	$	868.5		$	1,403.5	$	113.9	$	(636.2	)	$	1,749.7



November 30, 2013	Parent		Guarantor Subsidiaries		Non-guarantor Subsidiaries		Eliminations			Consolidated
	(In millions)
Cash and cash equivalents	$	192.7	$	4.9	$	—	$	—		$	197.6
Accounts receivable	—		211.4		2.7		—			214.1
Inventories	—		100.5		5.4		—			105.9
Recoverable from the U.S. government, Northrop, and other third parties for environmental remediation costs	0.4		26.0		—		—			26.4
Other receivables, prepaid expenses and other	2.6		18.8		1.0		—			22.4
Income taxes	30.1		—		—		(17.5		)	12.6
Deferred income taxes	10.9		4.9		1.2		—			17.0
Total current assets	236.7		366.5		10.3		(17.5		)	596.0
Property, plant and equipment, net	4.7		364.4		5.6		—			374.7
Recoverable from the U.S. government and other third parties for environmental remediation costs	0.4		88.3		—		—			88.7
Deferred income taxes	48.8		107.2		19.7		—			175.7
Goodwill	—		159.6		—		—			159.6
Intercompany receivable	33.5		—		32.2		(65.7		)	—
Investments in subsidiaries	534.5		—		—		(534.5		)	—
Other noncurrent assets and intangibles, net	27.7		289.0		43.9		—			360.6
Total assets	$	886.3	$	1,375.0	$	111.7	$	(617.7	)	$	1,755.3
Short-term borrowings and current portion of long-term debt	$	2.7	$	0.2	$	—	$	—		$	2.9
Accounts payable	2.2		119.1		1.2		—			122.5
Reserves for environmental remediation costs	3.8		32.8		—		—			36.6
Income taxes payable	—		16.9		0.6		(17.5		)	—
Postretirement medical and life insurance benefits	5.5		1.8		—		—			7.3
Other current liabilities and advance payments on contracts	41.7		265.9		2.8		—			310.4
Total current liabilities	55.9		436.7		4.6		(17.5		)	479.7
Long-term debt	695.7		0.6		—		—			696.3
Reserves for environmental remediation costs	4.3		130.4		—		—			134.7
Pension benefits	23.6		238.1		—		—			261.7
Intercompany payable	—		65.7		—		(65.7		)	—
Postretirement medical and life insurance benefits	39.8		19.5		—		—			59.3
Other noncurrent liabilities	17.2		45.1		11.5		—			73.8
Total liabilities	836.5		936.1		16.1		(83.2		)	1,705.5
Commitments and contingencies (Note 8)
Redeemable common stock	0.2		—		—		—			0.2
Total shareholders’ equity	49.6		438.9		95.6		(534.5		)	49.6
Total liabilities, redeemable common stock, and shareholders’ equity	$	886.3	$	1,375.0	$	111.7	$	(617.7	)	$	1,755.3

Condensed Consolidating Statements of Cash Flows

(Unaudited)



Nine months ended August 31, 2014	Parent			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations			Consolidated
	(In millions)
Net cash (used in) provided by operating activities	$	(15.9	)	$	51.2		$	(1.0	)	$	(0.2	)	$	34.1
Cash flows from investing activities:
Capital expenditures	(0.1		)	(31.2		)	(0.6		)	—			(31.9		)
Other investing activities	0.2			—			—			—			0.2
Net cash provided by (used in) investing activities	0.1			(31.2		)	(0.6		)	—			(31.7		)
Cash flows from financing activities:
Debt repayments / repurchases	(164.8		)	(0.2		)	—			—			(165.0		)
Proceeds from issuance of debt	189.0			—			—			—			189.0
Debt issuance costs	(4.2		)	—			—			—			(4.2		)
Net transfers from (to) parent	22.9			(24.7		)	1.8			—			—
Other financing activities	(64.9		)	—			—			—			(64.9		)
Net cash (used in) provided by financing activities	(22.0		)	(24.9		)	1.8			—			(45.1		)
Net (decrease) increase in cash and cash equivalents	(37.8		)	(4.9		)	0.2			(0.2		)	(42.7		)
Cash and cash equivalents at beginning of year	192.7			4.9			—			—			197.6
Cash and cash equivalents at end of period	$	154.9		$	—		$	0.2		$	(0.2	)	$	154.9



Nine months ended August 31, 2013	Parent			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations			Consolidated
	(In millions)
Net cash (used in) provided by operating activities	$	(7.3	)	$	25.7		$	(1.5	)	$	9.6		$	26.5
Cash flows from investing activities:
Purchase of Rocketdyne Business	—			(411.2		)	—			—			(411.2		)
Capital expenditures	—			(38.7		)	—			—			(38.7		)
Purchase of investments	—			(0.5		)	—			—			(0.5		)
Net cash used in investing activities	—			(450.4		)	—			—			(450.4		)
Cash flows from financing activities:
Debt repayments	(1.9		)	(0.1		)	—			—			(2.0		)
Proceeds from issuance of debt	460.0			—			—			—			460.0
Debt issuance costs	(14.7		)	—			—			—			(14.7		)
Net transfers (to) from parent	(426.3		)	424.8			1.5			—			—
Other financing activities	0.4			—			—			—			0.4
Net cash provided by financing activities	17.5			424.7			1.5			—			443.7
Net increase in cash and cash equivalents	10.2			—			—			9.6			19.8
Cash and cash equivalents at beginning of year	172.4			—			—			(10.3		)	162.1
Cash and cash equivalents at end of period	$	182.6		$	—		$	—		$	(0.7	)	$	181.9