EX-99 3 sconso.txt EXHIBIT 99.4, 99.5 Exhibit 99.4 Unaudited Pro Forma Consolidated Statements of Income 2000 (Dollars in thousands)
Pro Pro Historical Forma Forma 1st Quarter Ended 3/31/00 IFF (1) BBA (2) Adjustments Combined ------------------------- -------------- ------------- ------------- ----------- Net sales $ 369,912 $117,341 $ (1,435)(3) $ 485,818 -------------- ------------- -------------- ------------- Cost of goods sold (8) 204,677 74,905 (1,496)(4) 278,086 Research and development expenses 26,812 7,105 33,917 Selling and administrative expenses (8) 61,749 24,430 86,179 Nonrecurring charges 9,354 - 9,354 Interest expense 2,137 536 16,250 (5) 18,923 Amortization - - 10,548 (6) 10,548 Other (income) expense, net (329) 653 324 -------------- ------------- -------------- ------------- 304,400 107,629 25,302 437,331 -------------- ------------- -------------- ------------- Income before taxes on income 65,512 9,712 (26,737) 48,487 Taxes on income 21,736 3,691 (6,664)(7) 18,763 -------------- ------------- -------------- ------------- Net income $ 43,776 $ 6,021 $ (20,073) $ 29,724 ============== ============= ============== =============
Pro Pro Historical Forma Forma 2nd Quarter Ended 6/30/00 IFF (1) BBA (2) Adjustments Combined ------------------------- -------------- ------------- --------------- --------------- Net sales $ 368,759 $123,565 $ (1,435)(3) $ 490,889 -------------- ------------- -------------- ------------- Cost of goods sold (8) 203,562 79,583 (1,496)(4) 281,649 Research and development expenses 26,945 6,886 33,831 Selling and administrative expenses (8) 61,754 24,435 86,189 Nonrecurring charges - - - Interest expense 3,074 465 16,250 (5) 19,789 Amortization - - 10,548 (6) 10,548 Other (income) expense, net 203 614 817 -------------- ------------- -------------- ------------- 295,538 111,983 25,302 432,823 -------------- ------------- -------------- ------------- Income before taxes on income 73,221 11,582 (26,737) 58,066 Taxes on income 24,305 4,401 (6,664)(7) 22,042 -------------- ------------- -------------- ------------- Net income $ 48,916 $ 7,181 $ (20,073) $ 36,024 ============== ============= ============== =============
Unaudited Pro Forma Consolidated Statements of Income 2000 (Dollars in thousands) Pro Pro Historical Forma Forma 3rd Quarter Ended 9/30/00 IFF (1) BBA (2) Adjustments Combined ------------------------- -------------- ------------- ----------------- -------------- Net sales $ 339,591 $121,648 $ (1,435)(3) $ 459,804 -------------- ------------- -------------- ------------- Cost of goods sold (8) 191,499 78,018 (1,496)(4) 268,021 Research and development expenses 28,666 6,769 35,435 Selling and administrative expenses (8) 62,181 22,519 84,700 Nonrecurring charges 7,685 - 7,685 Interest expense 4,195 433 16,250 (5) 20,878 Amortization - - 10,548 (6) 10,548 Other (income) expense, net 2,614 (1,380) 1,234 -------------- ------------- -------------- ------------- 296,840 106,359 25,302 428,501 -------------- ------------- -------------- ------------- Income before taxes on income 42,751 15,289 (26,737) 31,303 Taxes on income 13,824 5,088 (6,664)(7) 12,248 -------------- ------------- -------------- ------------- Net income $ 28,927 $ 10,201 $ (20,073) $ 19,055 ============== ============= ============== =============
Pro Pro Historical Forma Forma 4th Quarter Ended 12/31/00 IFF (1) BBA (2) Adjustments Combined -------------------------- -------------- ------------- ---------------- --------------- Net sales $ 384,533 $ 60,212 $ (644)(3) $ 444,101 -------------- ------------- -------------- ------------- Cost of goods sold 231,915 39,178 (849)(4) 270,244 Research and development expenses 30,248 3,073 - 33,321 Selling and administrative expenses 72,969 9,605 - 82,574 Nonrecurring charges 24,234 - - 24,234 Interest expense 15,666 252 5,650 (5) 21,568 Amortization 7,032 - 3,519 (6) 10,551 Other (income) expense, net (174) (118) - (292) -------------- ------------- -------------- ------------- 381,890 51,990 8,320 442,200 -------------- ------------- -------------- ------------- Income before taxes on income 2,643 8,222 (8,964) 1,901 Taxes on income 1,257 3,255 (1,206)(7) 3,306 -------------- ------------- -------------- ------------- Net income $ 1,386 $ 4,967 $ (7,758) $ (1,405) ============== ============= ============== =============
Exhibit 99.5
Unaudited Pro Forma Consolidated Statements of Income 2000 (Dollars in thousands) Pro Pro Historical Forma Forma Year Ended 12/31/00 IFF (1) BBA (2) Adjustments Combined ------------------- -------------- ------------- ---------------- --------------- Net sales $1,462,795 $422,766 $ (4,949)(3) $1,880,612 -------------- ------------- -------------- ------------- Cost of goods sold 831,653 271,684 (5,337)(4) 1,098,000 Research and development expenses 112,671 23,833 136,504 Selling and administrative expenses 258,653 80,989 339,642 Nonrecurring charges 41,273 - 41,273 Interest expense 25,072 1,686 54,400 (5) 81,158 Amortization 7,032 - 35,163 (6) 42,195 Other (income) expense, net 2,314 (231) 2,083 -------------- ------------- -------------- ------------- 1,278,668 377,961 84,226 1,740,855 -------------- ------------- -------------- ------------- Income before taxes on income 184,127 44,805 (89,175) 139,757 Taxes on income 61,122 16,435 (21,198)(7) 56,359 -------------- ------------- -------------- ------------- Net income $ 123,005 $ 28,370 $ (67,977) $ 83,398 ============== ============= ============== =============
Notes to Unaudited Pro Forma Consolidated Statements of Income: (1) IFF acquired Bush Boake Allen ("BBA"), effective November 3, 2000, and the BBA operating results are included in IFF's consolidated results from that date. (2) BBA results from the beginning of the year to November 3, 2000, the date of acquisition, are included in the respective periods. (3) To eliminate intercompany sales between IFF and BBA for the period from the beginning of the year to November 3, 2000, the date of acquisition. For purposes of computing the individual quarter eliminations, the full year amount was allocated on a pro rata basis. Post-acquisition, intercompany sales are eliminated in arriving at the IFF historical results. (4) To eliminate cost of goods sold relating to intercompany sales and account for related estimated profit that remains in inventory. For purposes of computing the individual quarter eliminations, the full year amount was allocated on a pro rata basis. (5) To reflect the recognition of incremental interest expense on additional borrowings of approximately $970.0 million, equal to the cash consideration exchanged in the acquisition. Interest expense was calculated using an average interest rate of 6.7%. The interest rate reflects IFF's average borrowing rate during the year. (6) To reflect the amortization of goodwill and other intangibles resulting from the preliminary allocation of the excess of consideration over the net assets of BBA. Other intangible assets include patents, trademarks and other intellectual property owned or developed by BBA, the value of which is being amortized over periods ranging from 10 to 20 years. Under current accounting rules, IFF would expect the amount of excess consideration allocated to goodwill to be amortized over 20 years. In December 2000, the Financial Accounting Standards Board (FASB) reached a tentative decision to use the nonamortization approach to account for purchased goodwill. Under the revised proposal, goodwill would not be amortized annually, but instead would be reviewed for impairment and written down (expensed against earnings) when the carrying value of the goodwill exceeds its fair value. The final standard has not been issued and the proposed approach may change. (7) To reflect the tax effect, as appropriate, of the pro forma adjustments. (8) Reflects the reclassification of shipping and handling costs from Selling expense to Cost of goods sold in accordance with guidance established by Emerging Issues Task Force No. 00-10, "Accounting for Shipping and Handling Fees and Costs." This change in classification was made by IFF in the 4th quarter 2000 and does not affect the reported BBA historical amounts.