(State or Other Jurisdiction of Incorporation or Organization) | (Commission File Number) | (I.R.S. Employer Identification No.) |
(Address of Principal Executive Offices) | (Zip Code) |
Title of each class | Trading Symbol | Name of each exchange on which registered |
Press release issued by Masco, dated February 18, 2020, announcing the completion of the Cabinetry sale | |||
Unaudited pro forma condensed consolidated balance sheet of Masco Corporation dated as of December 31, 2019 and the unaudited pro forma condensed consolidated statement of operations of Masco Corporation for the year ended December 31, 2019. | |||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
MASCO CORPORATION | ||
By: | /s/ John G. Sznewajs | |
Name: | John G. Sznewajs | |
Title: | Vice President, Chief Financial Officer | |
Masco Historical | Cabinetry Business' Separation (A) (B) | Notes | Pro Forma Masco Continuing Operations | |||||||||||
Net Sales | $ | 6,707 | $ | — | $ | 6,707 | ||||||||
Cost of sales | 4,336 | — | 4,336 | |||||||||||
Gross profit | 2,371 | — | 2,371 | |||||||||||
Selling, general and administrative expenses | 1,274 | — | 1,274 | |||||||||||
Impairment charge for other intangible assets | 9 | — | 9 | |||||||||||
Operating profit | 1,088 | — | 1,088 | |||||||||||
Interest expense | (159 | ) | — | (159 | ) | |||||||||
Other, net | (15 | ) | — | (15 | ) | |||||||||
Income from continuing operations before income taxes | 914 | — | 914 | |||||||||||
Income tax expense | 230 | — | 230 | |||||||||||
Income from continuing operations | $ | 684 | $ | — | $ | 684 | ||||||||
Income from continuing operations attributable to Masco Corporation | $ | 639 | $ | — | $ | 639 | ||||||||
Basic income per common share attributable to Masco Corporation: | ||||||||||||||
Income from continuing operations | $ | 2.21 | $ | 2.21 | ||||||||||
Weighted average shares outstanding | 287 | 287 | ||||||||||||
Diluted income per common share attributable to Masco Corporation: | ||||||||||||||
Income from continuing operations | $ | 2.20 | $ | 2.20 | ||||||||||
Weighted average shares outstanding | 288 | 288 |
Masco Historical | Cabinetry Business' Separation (A) | Pro Forma Adjustments | Notes | Pro Forma Masco Continuing Operations | ||||||||||||||
ASSETS | ||||||||||||||||||
Current assets: | ||||||||||||||||||
Cash and cash investments | $ | 697 | $ | 850 | $ | — | $ | 1,547 | ||||||||||
Receivables | 997 | — | — | 997 | ||||||||||||||
Inventories | 754 | — | — | 754 | ||||||||||||||
Prepaid expenses and other | 90 | — | — | 90 | ||||||||||||||
Assets held for sale | 173 | (173 | ) | — | — | |||||||||||||
Total current assets | 2,711 | 677 | — | 3,388 | ||||||||||||||
Property and equipment, net | 878 | — | — | 878 | ||||||||||||||
Operating lease right-of-use assets | 176 | — | — | 176 | ||||||||||||||
Goodwill | 509 | — | — | 509 | ||||||||||||||
Other intangible assets, net | 259 | — | — | 259 | ||||||||||||||
Other assets | 139 | 150 | — | 289 | ||||||||||||||
Assets held for sale | 355 | (355 | ) | — | — | |||||||||||||
Total assets | $ | 5,027 | $ | 472 | $ | — | $ | 5,499 | ||||||||||
LIABILITIES AND EQUITY | ||||||||||||||||||
Current liabilities: | ||||||||||||||||||
Accounts payable | $ | 697 | $ | — | $ | — | $ | 697 | ||||||||||
Notes payable | 2 | — | — | 2 | ||||||||||||||
Accrued liabilities | 700 | — | 16 | (C) | 716 | |||||||||||||
Liabilities held for sale | 149 | (149 | ) | — | — | |||||||||||||
Total current liabilities | 1,548 | (149 | ) | 16 | 1,415 | |||||||||||||
Long-term debt | 2,771 | — | — | 2,771 | ||||||||||||||
Other liabilities | 751 | — | — | 751 | ||||||||||||||
Liabilities held for sale | 13 | (13 | ) | — | — | |||||||||||||
Total liabilities | 5,083 | (162 | ) | 16 | 4,937 | |||||||||||||
Equity: | ||||||||||||||||||
Common shares - $1 par value; Authorized shares: 1,400,000,000; Issued and outstanding: 275,600,000 | 276 | — | — | 276 | ||||||||||||||
Preferred shares authorized: 1,000,000; Issued and outstanding – None | — | — | — | — | ||||||||||||||
Paid-in capital | — | — | — | — | ||||||||||||||
Retained (deficit) equity | (332 | ) | 634 | (16 | ) | (D) | 286 | |||||||||||
Accumulated other comprehensive loss | (179 | ) | — | — | (179 | ) | ||||||||||||
Total Masco Corporation’s shareholders’ (deficit) equity | (235 | ) | 634 | (16 | ) | 383 | ||||||||||||
Noncontrolling interest | 179 | — | — | 179 | ||||||||||||||
Total equity | (56 | ) | 634 | (16 | ) | 562 | ||||||||||||
Total liabilities and equity | $ | 5,027 | $ | 472 | $ | — | $ | 5,499 |
(A) | The information in the Cabinetry Business' Separation column of the unaudited pro forma condensed consolidated statement of operations was derived from Masco’s audited financial statements for the year ended December 31, 2019, adjusted to include certain costs that are directly attributable to the Cabinetry business and are factually supportable, and to exclude corporate overhead costs that were previously allocated to the Cabinetry business. The information in the Cabinetry Business' Separation column of the unaudited pro forma condensed consolidated balance sheet was derived from Masco’s audited financial statements as of December 31, 2019, adjusted to include certain assets and liabilities that are directly attributable to the Cabinetry business and are factually supportable. The Cabinetry Business' Separation column also reflects the $850 million cash proceeds and $150 million of preferred stock based on the liquidation preference received in conjunction with the sale of Cabinetry. |
(B) | Amounts reported in Masco's Annual Report on Form 10-K for the year ended December 31, 2019, as filed with the Securities and Exchange Commission on February 11, 2020, which presents the results of operations of the Cabinetry business as discontinued operations. Therefore, no adjustments for this business are necessary. |
(C) | Reflects additional one-time transaction costs of $16 million expected to be incurred subsequent to December 31, 2019. One-time transaction costs incurred by Masco for the year ended December 31, 2019 was $8 million. Masco expects to incur and pay an aggregate of approximately $24 million of one-time transaction costs associated with the Separation, including legal and advisory costs. |
(D) | Shareholders’ (deficit) equity was adjusted for the pro forma adjustments specified in Notes (A) and (C), including the $850 million of cash and $150 million of preferred stock based on the liquidation preference received in conjunction with the sale of Cabinetry. |
&%P+S$N,"\ /#]X
M<&%C:V5T(&)E9VEN/2?ON[\G(&ED/2=7-4TP37!#96AI2'IR95-Z3E1C>FMC
M.60G/SX-"CQX.GAM<&UE=&$@>&UL;G,Z>#TB861O8F4Z;G,Z;65T82\B('@Z
M>&UP=&L](EA-4"!T;V]L:VET(#,N,"TR."P@9G)A;65W;W)K(#$N-B(^#0H)
M/')D9CI21$8@>&UL;G,ZE&![)GD5DD5[>&)ID&5[^4IRCMI\DR]C
MCC5]?@I^D!]_P,LZFN*$_;=FF".#YZ,!E9F"_(WZDTV"2W@KD4.!V&%\CW6!
MFDE^C?>!@2YYC5>!XPG/CIN#",G3F=^.K;8DSB^YJK"@11RSJ#&39P;(I4:$E@ @QR
M .8?=G!S&- ;=TMS\;F >!]TS*(J>.IUKXHD>;)VH7%C>G]WHU>&>T]XGSLO
M?#%YEA:=?2%YZ.0/=(=^:,YK=8E^&[?Z=GQ]Y:#+=V5]RHC=>$M]S7 N>3-]
MY%9;>A5]^3H'>N]^$A4@>U1]P>(Q