14. Condensed Consolidating Financial Statements of Guarantors

The Notes were issued by NBTY and are guaranteed by each of its current and future direct and indirect 100% owned subsidiaries, subject to certain exceptions. These guarantees are full, unconditional and joint and several. The following condensed consolidating financial information presents:

1.

Condensed consolidating financial statements as of December 31, 2013 and September 30, 2013 and for the three months ended December 31, 2013 and 2012 of (a) NBTY, the parent and issuer, (b) the guarantor subsidiaries, (c) the non-guarantor subsidiaries and (d) the Company on a consolidated basis; and

2.

Elimination entries necessary to consolidate NBTY, the parent, with guarantor and non-guarantor subsidiaries.

The condensed consolidating financial statements are presented using the equity method of accounting for investments in wholly owned subsidiaries. Under this method, the investments in subsidiaries are recorded at cost and adjusted for our share of the subsidiaries' cumulative results of operations, capital contributions, distributions and other equity changes. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions. This financial information should be read in conjunction with the financial statements and other notes related thereto.

In the first quarter of fiscal 2014, we revised the presentation of certain amounts related to the application of push-down accounting in connection with the acquisition of the Company by Carlyle on October 1, 2010 which resulted in a revised presentation of a debt balance and the associated intercompany interest between the parent and guarantors and the presentation of certain transactions previously reflected as intercompany activities as equity transactions. In addition, we revised the cash flow presentation for dividends remitted from the non-guarantor subsidiaries as well as funds remitted from the guarantor to the parent. These revisions impacted the consolidating balance sheet as of September 30, 2013 and the consolidating statements of income and comprehensive income and cash flows for the three months ended December 31, 2012. The revisions to this supplemental information did not impact any amounts reported in our previously issued Consolidated Financial Statements. In accordance with SEC Staff Accounting Bulletin Nos. 99 and 108, we assessed the materiality of these revisions and concluded that the revisions were not material to any of our previously issued consolidated financial statements. As comparative prior period supplemental guarantor subsidiaries financial information is presented in future filings, we will similarly revise such prior period information.

Condensed Consolidating Balance Sheet
As of December 31, 2013

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated

Assets
Current assets:
Cash and cash equivalents	$	19,151		$	1,994		$	95,605	$	—		$	116,750
Accounts receivable, net		—			164,418			39,775		—			204,193
Intercompany		19,202			—			—		(19,202	)		—
Inventories		—			651,323			185,326		—			836,649
Deferred income taxes		—			23,838			659		—			24,497
Other current assets		19,254			22,461			34,382					76,097

Total current assets		57,607			864,034			355,747		(19,202	)		1,258,186
Property, plant and equipment, net		89,000			311,861			180,062		—			580,923
Goodwill		—			813,688			452,433		—			1,266,121
Other intangible assets, net		—			1,591,317			363,857		—			1,955,174
Other assets		56,313			5,909			78		—			62,300
Intercompany		2,487,880			1,015,578			42,082		(3,545,540	)		—
Investments in subsidiaries		2,253,491			—			—		(2,253,491	)		—

Total assets	$	4,944,291		$	4,602,387		$	1,394,259	$	(5,818,233	)	$	5,122,704


Liabilities and Stockholder's Equity
Current liabilities:
Current portion of long-term debt	$	—		$	—		$	325	$	—		$	325
Accounts payable		—			215,424			76,567		—			291,991
Intercompany					19,202			—		(19,202	)		—
Accrued expenses and other current liabilities		23,442			109,349			54,816		—			187,607

Total current liabilities		23,442			343,975			131,708		(19,202	)		479,923
Intercompany		1,057,660			2,157,500			330,380		(3,545,540	)		0
Long-term debt, net of current portion		2,157,500			—			849		—			2,158,349
Deferred income taxes		10,322			637,726			99,583		—			747,631
Other liabilities		23,119			15,388			26,046		—			64,553

Total liabilities		3,272,043			3,154,589			588,566		(3,564,742	)		3,450,456
Commitments and contingencies
Stockholder's Equity:
Common stock		—			—			—		—			—
Capital in excess of par		1,558,546			1,211,581			733,411		(1,944,992	)		1,558,546
Retained earnings		114,005			239,034			61,136		(300,170	)		114,005
Accumulated other comprehensive income (loss)		(303	)		(2,817	)		11,146		(8,329	)		(303	)

Total stockholder's equity		1,672,248			1,447,798			805,693		(2,253,491	)		1,672,248

Total liabilities and stockholder's equity	$	4,944,291		$	4,602,387		$	1,394,259	$	(5,818,233	)	$	5,122,704

Condensed Consolidating Balance Sheet
As of September 30, 2013

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated

Assets
Current assets:
Cash and cash equivalents	$	81,356		$	35,357		$	81,848	$	—		$	198,561
Accounts receivable, net		—			127,894			43,776		—			171,670
Intercompany		34,549			—			—		(34,549	)		—
Inventories		—			561,276			178,676		—			739,952
Deferred income taxes		—			23,004			633		—			23,637
Other current assets		19,033			24,104			35,442		—			78,579

Total current assets		134,938			771,635			340,375		(34,549	)		1,212,399
Property, plant and equipment, net		88,612			308,852			174,065		—			571,529
Goodwill		—			813,688			447,114		—			1,260,802
Other intangible assets, net		—			1,601,964			358,388		—			1,960,352
Other assets		61,218			6,937			79		—			68,234
Intercompany		2,480,760			1,062,900			29,082		(3,572,742	)		—
Investments in subsidiaries		2,180,814			—			—		(2,180,814	)		—

Total assets	$	4,946,342		$	4,565,976		$	1,349,103	$	5,788,105		$	5,073,316


Liabilities and Stockholder's Equity
Current liabilities:
Current portion of long-term debt	$	—		$	—		$	376	$	—		$	376
Accounts payable		—			195,712			63,348		—			259,060
Intercompany		—			34,549			—		(34,549	)		—
Accrued expenses and other current liabilities		38,407			109,865			71,494		—			219,766

Total current liabilities		38,407			340,126			135,218		(34,549	)		479,202
Intercompany		1,091,982			2,157,500			323,260		(3,572,742	)		0
Long-term debt, net of current portion		2,157,500			—			905		—			2,158,405
Deferred income taxes		14,151			637,726			99,542		—			751,419
Other liabilities		19,463			14,650			25,338		—			59,451

Total liabilities		3,321,503			3,150,002			584,263		(3,607,291	)		3,448,477
Commitments and contingencies
Stockholder's Equity:
Common stock		—			—			—		—			—
Capital in excess of par		1,556,926			1,211,581			733,411		(1,944,992	)		1,556,926
Retained earnings		81,497			208,295			30,198		(238,493	)		81,497
Accumulated other comprehensive income (loss)		(13,584	)		(3,902	)		1,231		2,671			(13,584	)

Total stockholder's equity		1,624,839			1,415,974			764,840		(2,180,814	)		1,624,839

Total liabilities and stockholder's equity	$	4,946,342		$	4,565,976		$	1,349,103	$	5,788,105		$	5,073,316

Condensed Consolidating Statement of Income
Three Months Ended December 31, 2013

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated

Net sales	$	—		$	571,066		$	285,141		$	(29,102	)	$	827,105

Costs and expenses:
Cost of sales		—			341,868			128,952			(29,102	)		441,718
Advertising, promotion and catalog		—			29,114			9,408			—			38,522
Selling, general and administrative		22,273			116,880			93,531			—			232,684

		22,273			487,862			231,891			(29,102	)		712,924

(Loss) income from operations		(22,273	)		83,204			53,250			—			114,181

Other income (expense):
Intercompany interest		39,708			(34,798	)		(4,910	)		—			—
Interest		(34,798	)		—			(20	)		—			(34,818	)
Miscellaneous, net		910			951			(871	)		—			990

		5,820			(33,847	)		(5,801	)		—			(33,828	)

Income before income taxes		(16,453	)		49,357			47,449			—			80,353
Provision for income taxes		(5,369	)		18,615			13,286			—			26,532
Equity in income of subsidiaries		64,905			—			—			(64,905	)		—

Net income		53,821			30,742			34,163			(64,905	)		53,821


Other comprehensive income, net of tax:
Foreign currency translation adjustment, net of taxes		12,196			—			9,915			(9,915	)		12,196
Change in fair value of interest rate swaps, net of taxes		1,085			1,085			—			(1,085	)		1,085

Comprehensive income	$	67,102		$	31,827		$	44,078		$	(75,905	)	$	67,102

Condensed Consolidating Statement of Income and Comprehensive Income
Three Months Ended December 31, 2012

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated

Net sales	$	—		$	563,570		$	251,341		$	(25,684	)	$	789,227

Costs and expenses:
Cost of sales		—			342,474			111,959			(25,684	)		428,749
Advertising, promotion and catalog		—			28,716			7,128			—			35,844
Selling, general and administrative		22,837			109,882			86,790			—			219,509

		22,837			481,072			205,877			(25,684	)		684,102

(Loss) income from operations		(22,837	)		82,498			45,464			—			105,125

Other income (expense):
Intercompany interest		39,658			(37,133	)		(2,525	)		—			—
Interest		(37,133	)		—			—			—			(37,133	)
Miscellaneous, net		74			2,097			(1,723	)		—			448

		2,599			(35,036	)		(4,248	)		—			(36,685	)

Income from operations before income taxes		(20,238	)		47,462			41,216			—			68,440
(Benefit)/provision for income taxes		(6,128	)		17,857			11,540			—			23,269
Equity in income of subsidiaries		59,281			—			—			(59,281	)		—

Net income		45,171			29,605			29,676			(59,281	)		45,171

Other comprehensive income:
Foreign currency translation adjustment, net of taxes		(1,279	)		—			2,803			(2,803	)		(1,279	)
Change in fair value of interest rate swaps, net of taxes		1,308			1,308			—			(1,308	)		1,308

Comprehensive income	$	45,200		$	30,913		$	32,479		$	(63,392	)	$	45,200

Condensed Consolidating Statement of Cash Flows
Three Months Ended December 31, 2013

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated

Cash (used in) provided by operating activities	$	(6,378	)	$	(54,362	)	$	23,876		$	(3,225	)	$	(40,089	)

Cash flows from investing activities:
Purchase of property, plant and equipment		(1,127	)		(12,388	)		(7,732	)		—			(21,247	)

Cash used in investing activities		(1,127	)		(12,388	)		(7,732	)		—			(21,247	)

Cash flows from financing activities:
Principal payments under long-term agreements		—			—			(132	)		—			(132	)
Intercompay		(33,387	)		33,387			—			—			—
Dividends paid		(21,313	)					(3,225	)		3,225			(21,313	)

Cash used in financing activities		(54,700	)		33,387			(3,357	)		3,225			(21,445	)

Effect of exchange rate changes on cash		—			—			970			—			970

Net (decrease) increase in cash and cash equivalents		(62,205	)		(33,363	)		13,757			—			(81,811	)
Cash and cash equivalents at beginning of period		81,356			35,357			81,848			—			198,561

Cash and cash equivalents at end of period	$	19,151		$	1,994		$	95,605		$	—		$	116,750

Condensed Consolidating Statement of Cash Flows
Three Months Ended December 31, 2012

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated

Net cash provided by (used in) operating activities	$	82,020		$	(17,526	)	$	(11,991	)	$	(12,862	)	$	39,641

Cash flows from investing activities:
Purchase of property, plant and equipment		(10,225	)		(17,094	)		(6,199	)		—			(33,518	)
Proceeds from sale of building		7,548			—			—			—			7,548
Cash paid for acquisitions, net of cash acquired		(78,089	)		—			—			—			(78,089	)

Net cash used in investing activities		(80,766	)		(17,094	)		(6,199	)		—			(104,059	)

Cash flows from financing activities:
Proceeds from borrowings under the revolver		80,000			—			—			—			80,000
Paydowns of borrowings under the revolver		(10,000	)		—			—			—			(10,000	)
Payments for financing fees		(6,121	)		—			—			—			(6,121	)
Intercompany		(23,111	)		23,111			—			—			—
Dividends paid		(193,956	)		—			(12,862	)		12,862			(193,956	)

Net cash used in financing activities		(153,188	)		23,111			(12,862	)		12,862			(130,077	)

Effect of exchange rate changes on cash and cash equivalents		—			—			(53	)		—			(53	)

Net decrease in cash and cash equivalents		(151,934	)		(11,509	)		(31,105	)		—			(194,548	)
Cash and cash equivalents at beginning of period		183,661			14,589			116,886			—			315,136

Cash and cash equivalents at end of period	$	31,727		$	3,080		$	85,781		$	—		$	120,588

The table below presents, for each line item of the Condensed Financial Statements as of September 30, 2013 and for the three months ended December 31, 2012 that we corrected, a comparison of the revised balance with the originally reported balance.

	Parent Company						Guarantor Subsidiaries					Non-Guarantor Subsidiaries						Eliminations

($ in millions)	As Reported			As Revised			As Reported		As Revised			As Reported			As Revised			As Reported			As Revised
Balance Sheet
Current Assets
Intercompany	$	857.7		$	34.5		$	—	$	—		$	264.1		$	—		$	(1,121.8	)	$	(34.5	)
Other current assets	$	—		$	19.0		$	43.1	$	24.1		$	35.4		$	35.4		$	—		$	—
Total current assets	$	939.0		$	134.9		$	790.7	$	771.6		$	604.4		$	340.4		$	(1,121.8	)	$	(34.5	)
Other assets	$	—		$	61.2		$	68.2	$	6.9		$	0.1		$	0.1		$	—		$	—
Intercompany	$	323.3		$	2,480.8		$	—	$	1,062.9		$	—		$	29.1		$	(323.3	)	$	(3,572.7	)
Investments in subsidiaries	$	3,211.1		$	2,180.8		$	—	$	—		$	—		$	—		$	(3,211.1	)	$	(2,180.8	)
Total assets	$	4,562.0		$	4,946.3		$	3,583.3	$	4,566.0		$	1,584.1		$	1,349.1		$	(4,656.1	)	$	(5,788.1	)
Liabilities and Stockholder's Equity
Current liabilities:
Intercompany	$	—		$	—		$	1,121.8	$	34.5		$	—		$	—		$	(1,121.8	)	$	(34.5	)
Total current liabilities	$	38.4		$	38.4		$	1,424.3	$	340.1		$	135.2		$	135.2		$	(1,121.8	)	$	(34.5	)
Intercompany	$	—		$	1,092.0		$	—	$	2,157.5		$	323.3		$	323.3		$	(323.3	)	$	(3,572.7	)
Deferred income taxes	$	721.8		$	14.2		$	22.0	$	637.7		$	7.5		$	99.5		$	—		$	—
Total liabilities	$	2,937.2		$	3,321.5		$	1,464.0	$	3,150.0		$	492.3		$	584.3		$	(1,445.0	)	$	(3,607.3	)
Stockholder's Equity:
Capital in excess of par	$	1,556.9		$	1,556.9		$	352.0	$	1,211.6		$	301.3		$	733.4		$	(653.3	)	$	(1,945.0	)
Retained earnings	$	81.5		$	81.5		$	1,767.3	$	208.3		$	789.3		$	30.2		$	(2,556.6	)	$	(238.5	)
Accumulated other comprehensive income (loss)	$	(13.6	)	$	(13.6	)	$	—	$	(3.9	)	$	1.2		$	1.2		$	(1.2	)	$	2.7
Total stockholder's equity	$	1,624.8		$	1,624.8		$	2,119.3	$	1,416.0		$	1,091.8		$	764.8		$	(3,211.1	)	$	(2,180.8	)
Total liabilities and stockholder's equity	$	4,562.0		$	4,946.3		$	3,583.3	$	4,566.0		$	1,584.1		$	1,349.1		$	(4,656.1	)	$	(5,788.1	)
Statement of income and comprehensive income
Intercompany interest	$	2.5		$	39.7		$	—	$	(37.1	)	$	(2.5	)	$	(2.5	)	$	—		$	—
Total other income (expense)	$	(34.5	)	$	2.6		$	2.1	$	(35.0	)	$	(4.2	)	$	(4.2	)	$	—		$	—
Income before income taxes	$	(57.4	)	$	(20.2	)	$	84.6	$	47.5		$	41.2		$	41.2		$	—		$	—
Provision for income taxes	$	(17.9	)	$	(6.1	)	$	29.6	$	17.9		$	11.5		$	11.5		$	—		$	—
Equity in income of subsidiaries	$	84.7		$	59.3		$	—	$	—		$	—		$	—		$	(84.7	)	$	(59.3	)
Net income	$	45.2		$	45.2		$	55.0	$	29.6		$	29.7		$	29.7		$	(84.7	)	$	(59.3	)
Change in fair value of interest rate swap, net of taxes	$	1.3		$	1.3		$	—	$	1.3		$	—		$	—		$	—		$	(1.3	)
Comprehensive income	$	45.2		$	45.2		$	55.0	$	30.9		$	29.7		$	29.7		$	(84.7	)	$	(63.4	)
Statement of cash flows
Cash (used in) provided by operating activities	$	58.9		$	82.0		$	5.6	$	(17.5	)	$	(24.9	)	$	(12.0	)	$	—		$	(12.9	)
Dividends paid	$	(194.0	)	$	(194.0	)	$	—	$	—		$	—		$	(12.9	)	$	—		$	12.9
Intercompany	$	—		$	(23.1	)	$	—	$	23.1		$	—		$	—		$	—		$	—
Cash used in financing activities	$	(130.1	)	$	(153.2	)	$	—	$	23.1		$	—		$	(12.9	)	$	—		$	12.9