EX-99.1 3 dex991.htm RECONCILIATION OF NON-GAAP FINANCIAL MEASURES Reconciliation of non-GAAP financial measures

Exhibit 99.1

ARAMARK CORPORATION AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP MEASURES

(Unaudited)

(In thousands)

Although ARAMARK Corporation continued as the same legal entity after the going-private transaction (the “Transaction”), the consolidated statements of income are presented for two periods: Predecessor and Successor, which relate to the period preceding the Transaction and the period succeeding the Transaction, respectively. The Company refers to the operations of ARAMARK Corporation and subsidiaries for both the Predecessor and Successor periods. We have prepared our discussion of the results of operations for the fiscal year ended September 28, 2007 by comparing the mathematical combination of the Successor and Predecessor periods in the fiscal year ended September 28, 2007 to the Predecessor fiscal year ended September 29, 2006. Although this presentation does not comply with U.S. generally accepted accounting principles (GAAP), we believe that it provides a meaningful method of comparison. The combined operating results have not been prepared as pro forma results under applicable regulations and may not reflect the actual results we would have achieved absent the Transaction and may not be predictive of future results of operations.

ADJUSTED SALES GROWTH

Management believes that presentation of sales growth, adjusted to eliminate the effects of acquisitions, divestitures, the impact of currency translation and conforming the fiscal reporting period of a subsidiary to that of ARAMARK Corporation, provides useful information to investors because it enhances comparability between the current year and prior year reporting periods. Elimination of the currency translation effect provides constant currency comparisons without the distortion of currency rate fluctuations.

 

     Fiscal Year Ended    

%

Change

 
     September 28, 2007     September 29, 2006    

ARAMARK Corporation Consolidated Sales (as reported)

   $ 12,384,316     $ 11,621,173     7 %

Effect of Currency Translation

     —         152,801    

Effect of Acquisitions and Divestitures

     (79,646 )     (54,662 )  

Conforming the Fiscal Reporting Period of a Subsidiary to that of ARAMARK Corporation

     (25,223 )     —      
                  

ARAMARK Corporation Consolidated Sales (as adjusted)

   $ 12,279,447     $ 11,719,312     5 %
                  

 

     Fiscal Year Ended    

%

Change

 
     September 28, 2007     September 29, 2006    

Food and Support Services—Domestic Sales (as reported)

   $ 8,433,387     $ 8,001,908     5 %

Effect of Currency Translation

     —         13,607    

Effect of Acquisitions and Divestitures

     (29,366 )     (15,138 )  
                  

Food and Support Services—Domestic Sales (as adjusted)

   $ 8,404,021     $ 8,000,377     5 %
                  

 

     Fiscal Year Ended    

%

Change

 
     September 29, 2006     September 30, 2005    

ARAMARK Corporation Consolidated Sales (as reported)

   $ 11,621,173     $ 10,963,360     6 %

Effect of Currency Translation

     —         19,049    

Effect of Acquisitions and Divestitures

     (137,344 )     (95,558 )  
                  

ARAMARK Corporation Consolidated Sales (as adjusted)

   $ 11,483,829     $ 10,886,851     5 %
                  

 

     Fiscal Year Ended    

%

Change

 
     September 29, 2006     September 30, 2005    

Food and Support Services—Domestic Sales (as reported)

   $ 8,001,908     $ 7,596,050     5 %

Effect of Currency Translation

     —         32,025    

Effect of Acquisitions and Divestitures

     (15,499 )     (62,650 )  
                  

Food and Support Services—Domestic Sales (as adjusted)

   $ 7,986,409     $ 7,565,425     6 %
                  


ADJUSTED OPERATING INCOME

Management believes that presentation of operating income adjusted to eliminate the effects of acquisitions, divestitures, the impact of currency translation, for fiscal 2006, the effects of SFAS No. 123R stock option expense ($16.0 million), the goodwill impairment and adjustments to asset and liability carrying values in the Uniform and Career Apparel segment (approximately $43.0 million), and proposed merger transaction costs ($6.4 million), and for fiscal 2005, the effects of the gain from a real estate sale by an equity affiliate ($9.7 million) and the charge for the exit of the West Africa oil services business and UK severance costs ($7.4 million), provides useful information to investors because it enhances comparability between the current year and prior year reporting periods. Elimination of the currency translation effect provides constant currency comparisons without the distortion of currency rate fluctuations.

 

     Fiscal Year Ended    

%

Change

 
     September 29, 2006     September 30, 2005    

ARAMARK Corporation Consolidated Operating Income (as reported)

   $ 530,531     $ 580,172     -9 %

SFAS No. 123R Stock Option Expense

     16,041       —      

Goodwill Impairment and Adjustments to Asset and Liability Carrying Values in the Uniform and Career Apparel Segment

     42,937       —      

Proposed Merger Transaction Costs

     6,428       —      

Gain from Real Estate Sale by Equity Affiliate

     —         (9,737 )  

Charge for Exit of West Africa Oil Services Business and UK Severance Costs

     —         7,403    

Effect of Currency Translation

     —         716    

Effect of Acquisitions and Divestitures

     (7,955 )     (5,338 )  
                  

ARAMARK Corporation Consolidated Operating Income (as adjusted)

   $ 587,982     $ 573,216     3 %
                  

 

     Fiscal Year Ended    

%

Change

 
     September 29, 2006    September 30, 2005    

Food and Support Services—Domestic Operating Income (as reported)

   $ 433,855    $ 428,028     1 %

Gain from Real Estate Sale by Equity Affiliate

     —        (9,737 )  
                 

Food and Support Services—Domestic Operating Income (as adjusted)

   $ 433,855    $ 418,291     4 %
                 

 

     Fiscal Year Ended   

%

Change

 
     September 29, 2006    September 30, 2005   

Food and Support Services—International Operating Income (as reported)

   $ 73,440    $ 53,009    39 %

Charge for Exit of West Africa Oil Services Business and UK Severance Costs

     —        7,403   
                

Food and Support Services—International Operating Income (as adjusted)

   $ 73,440    $ 60,412    22 %