Delaware | 001-11442 | 34-1712937 |
(State of other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification No.) |
3055 Torrington Drive, Ball Ground, Georgia | 30107 | |
(Address of principal executive offices) | (ZIP Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit No. | Description |
99.1 |
Chart Industries, Inc. | |
Date: December 21, 2018 | |
By: /s/ Jillian C. Evanko Jillian C. Evanko, Chief Executive Officer, President and Chief Financial Officer | |
September 30, 2018 | ||||||||||||||||
Historical (As Reported) | CAIRE Business (a) | Pro Forma Adjustments | Pro Forma | |||||||||||||
ASSETS | ||||||||||||||||
Current Assets | ||||||||||||||||
Cash and cash equivalents | $ | 157.2 | $ | — | $ | 133.5 | (b) | $ | 290.7 | |||||||
Accounts receivable, net | 177.3 | — | — | 177.3 | ||||||||||||
Inventories, net | 188.2 | — | — | 188.2 | ||||||||||||
Unbilled contract revenue | 34.2 | — | — | 34.2 | ||||||||||||
Prepaid expenses | 10.2 | — | — | 10.2 | ||||||||||||
Other current assets | 14.0 | — | — | 14.0 | ||||||||||||
Current assets of discontinued operations | 86.7 | 86.7 | — | — | ||||||||||||
Total Current Assets | 667.8 | 86.7 | 133.5 | 714.6 | ||||||||||||
Property, plant, and equipment, net | 288.4 | — | — | 288.4 | ||||||||||||
Goodwill | 457.2 | — | — | 457.2 | ||||||||||||
Identifiable intangible assets, net | 270.3 | — | — | 270.3 | ||||||||||||
Other assets | 18.1 | — | — | 18.1 | ||||||||||||
Non-current assets of discontinued operations | 36.7 | 36.7 | — | — | ||||||||||||
TOTAL ASSETS | $ | 1,738.5 | $ | 123.4 | $ | 133.5 | $ | 1,748.6 | ||||||||
LIABILITIES AND EQUITY | ||||||||||||||||
Current Liabilities | ||||||||||||||||
Accounts payable | $ | 94.8 | $ | — | $ | — | $ | 94.8 | ||||||||
Customer advances and billing in excess of contract revenue | 94.5 | — | — | 94.5 | ||||||||||||
Accrued salaries, wages, and benefits | 34.3 | — | — | 34.3 | ||||||||||||
Current portion of warranty reserve | 8.6 | — | — | 8.6 | ||||||||||||
Short-term debt and current portion of long-term debt | 9.7 | — | — | 9.7 | ||||||||||||
Other current liabilities | 39.5 | — | 6.1 | (b) (c) (d) | 45.6 | |||||||||||
Current liabilities of discontinued operations | 31.4 | 31.4 | — | — | ||||||||||||
Total Current Liabilities | 312.8 | 31.4 | 6.1 | 287.5 | ||||||||||||
Long-term debt | 500.5 | 500.5 | ||||||||||||||
Long-term deferred tax liabilities | 55.3 | — | 55.3 | |||||||||||||
Accrued pension liabilities | 8.4 | — | 8.4 | |||||||||||||
Other long-term liabilities | 17.1 | — | 17.1 | |||||||||||||
Non-current liabilities of discontinued operations | 3.4 | 3.4 | — | — | ||||||||||||
Total Liabilities | 897.5 | 34.8 | 6.1 | 868.8 | ||||||||||||
Total Equity | 841.0 | 88.6 | 127.4 | (e) | 879.8 | |||||||||||
TOTAL LIABILITIES AND EQUITY | $ | 1,738.5 | $ | 123.4 | $ | 133.5 | $ | 1,748.6 |
Nine Months Ended September 30, 2018 | ||||||||||||||||
Historical (As Reported) | CAIRE Business (f) | Pro Forma Adjustments | Pro Forma | |||||||||||||
Sales | $ | 794.2 | $ | — | $ | — | $ | 794.2 | ||||||||
Cost of sales | 572.2 | — | — | 572.2 | ||||||||||||
Gross profit | 222.0 | — | — | 222.0 | ||||||||||||
Selling, general, and administrative expenses | 140.5 | — | (0.9 | ) | (g) | 139.6 | ||||||||||
Amortization expense | 15.7 | — | — | 15.7 | ||||||||||||
Operating expenses | 156.2 | — | (0.9 | ) | 155.3 | |||||||||||
Operating income | 65.8 | — | 0.9 | 66.7 | ||||||||||||
Other expenses: | ||||||||||||||||
Interest expense, net | 17.9 | — | — | 17.9 | ||||||||||||
Financing costs amortization | 1.0 | — | — | 1.0 | ||||||||||||
Foreign currency gain and other | (0.2 | ) | — | — | (0.2 | ) | ||||||||||
Other expenses, net | 18.7 | — | — | 18.7 | ||||||||||||
Income from continuing operations before income taxes | 47.1 | — | 0.9 | 48.0 | ||||||||||||
Income tax expense | 9.7 | — | 0.2 | (h) | 9.9 | |||||||||||
Net income from continuing operations | 37.4 | — | 0.7 | 38.1 | ||||||||||||
Income from discontinued operations, net of tax | 4.7 | 4.7 | — | — | ||||||||||||
Net income | 42.1 | 4.7 | 0.7 | 38.1 | ||||||||||||
Less: Income attributable to noncontrolling interests, net of taxes | 1.8 | — | — | 1.8 | ||||||||||||
Net income attributable to Chart Industries, Inc. | $ | 40.3 | $ | 4.7 | $ | 0.7 | $ | 36.3 | ||||||||
Net income attributable to Chart Industries, Inc. per common share: | ||||||||||||||||
Basic | $ | 1.30 | $ | 1.17 | ||||||||||||
Diluted | $ | 1.25 | $ | 1.13 | ||||||||||||
Weighted average number of common shares outstanding: | ||||||||||||||||
Basic | 30.97 | 30.97 | ||||||||||||||
Diluted | 32.14 | 32.14 |
Year Ended December 31, 2017 | ||||||||||||||||
Historical (As Reported) | CAIRE Business (f) | Pro Forma Adjustments | Pro Forma | |||||||||||||
Sales | $ | 988.8 | $ | 145.9 | $ | — | $ | 842.9 | ||||||||
Cost of sales | 716.7 | 105.4 | — | 611.3 | ||||||||||||
Gross profit | 272.1 | 40.5 | — | 231.6 | ||||||||||||
Selling, general, and administrative expenses | 215.1 | 31.8 | (1.2 | ) | (g) | 182.1 | ||||||||||
Amortization expense | 15.0 | 2.9 | — | 12.1 | ||||||||||||
Operating expenses | 230.1 | 34.7 | (1.2 | ) | 194.2 | |||||||||||
Operating income | 42.0 | 5.8 | 1.2 | 37.4 | ||||||||||||
Other expenses: | ||||||||||||||||
Interest expense, net | 19.4 | — | — | 19.4 | ||||||||||||
Loss on extinguishment of debt | 4.9 | — | — | 4.9 | ||||||||||||
Financing costs amortization | 1.3 | — | — | 1.3 | ||||||||||||
Foreign currency loss (gain) | 2.8 | (1.1 | ) | — | 3.9 | |||||||||||
Other expenses, net | 28.4 | (1.1 | ) | — | 29.5 | |||||||||||
Income before income taxes | 13.6 | 6.9 | 1.2 | 7.9 | ||||||||||||
Income tax (benefit) expense, net | (15.9 | ) | 2.0 | 0.4 | (h) | (17.5 | ) | |||||||||
Net income | 29.5 | 4.9 | 0.8 | 25.4 | ||||||||||||
Less: Income attributable to noncontrolling interests, net of taxes | 1.5 | — | — | 1.5 | ||||||||||||
Net income attributable to Chart Industries, Inc. | $ | 28.0 | $ | 4.9 | $ | 0.8 | $ | 23.9 | ||||||||
Net income attributable to Chart Industries, Inc. per common share: | ||||||||||||||||
Basic | $ | 0.91 | $ | 0.78 | ||||||||||||
Diluted | $ | 0.89 | $ | 0.76 | ||||||||||||
Weighted average number of common shares outstanding: | ||||||||||||||||
Basic | 30.74 | 30.74 | ||||||||||||||
Diluted | 31.31 | 31.31 |
Year Ended December 31, 2016 | ||||||||||||||||
Historical (As Reported) | CAIRE Business (f) | Pro Forma Adjustments | Pro Forma | |||||||||||||
Sales | $ | 859.2 | $ | 137.2 | $ | — | $ | 722.0 | ||||||||
Cost of sales | 592.8 | 80.5 | — | 512.3 | ||||||||||||
Gross profit | 266.4 | 56.7 | — | 209.7 | ||||||||||||
Selling, general, and administrative expenses | 195.9 | 35.0 | (1.2 | ) | (g) | 159.7 | ||||||||||
Amortization expense | 11.9 | 3.1 | — | 8.8 | ||||||||||||
Asset impairments | 1.2 | — | — | 1.2 | ||||||||||||
Operating expenses | 209.0 | 38.1 | (1.2 | ) | 169.7 | |||||||||||
Operating income | 57.4 | 18.6 | 1.2 | 40.0 | ||||||||||||
Other expenses: | ||||||||||||||||
Interest expense, net | 17.3 | — | — | 17.3 | ||||||||||||
Financing costs amortization | 1.3 | — | — | 1.3 | ||||||||||||
Foreign currency loss (gain) | 0.4 | (0.1 | ) | — | 0.5 | |||||||||||
Other expenses, net | 19.0 | (0.1 | ) | — | 19.1 | |||||||||||
Income before income taxes | 38.4 | 18.7 | 1.2 | 20.9 | ||||||||||||
Income tax expense, net | 13.7 | 4.1 | 0.4 | (h) | 10.0 | |||||||||||
Net income | 24.7 | 14.6 | 0.8 | 10.9 | ||||||||||||
Less: Income attributable to noncontrolling interests, net of taxes | (3.5 | ) | — | — | (3.5 | ) | ||||||||||
Net income attributable to Chart Industries, Inc. | $ | 28.2 | $ | 14.6 | $ | 0.8 | $ | 14.4 | ||||||||
Net income attributable to Chart Industries, Inc. per common share: | ||||||||||||||||
Basic | $ | 0.92 | $ | 0.47 | ||||||||||||
Diluted | $ | 0.91 | $ | 0.46 | ||||||||||||
Weighted average number of common shares outstanding: | ||||||||||||||||
Basic | 30.58 | 30.58 | ||||||||||||||
Diluted | 30.99 | 30.99 |
Year Ended December 31, 2015 | ||||||||||||||||
Historical (As Reported) | CAIRE Business (f) | Pro Forma Adjustments | Pro Forma | |||||||||||||
Sales | $ | 1,040.2 | $ | 157.0 | $ | — | $ | 883.2 | ||||||||
Cost of sales | 751.7 | 120.6 | — | 631.1 | ||||||||||||
Gross profit | 288.5 | 36.4 | — | 252.1 | ||||||||||||
Selling, general, and administrative expenses | 200.8 | 33.0 | (1.2 | ) | (g) | 166.6 | ||||||||||
Amortization expense | 17.3 | 8.2 | — | 9.1 | ||||||||||||
Asset impairments | 253.6 | 101.8 | — | 151.8 | ||||||||||||
Operating expenses | 471.7 | 143.0 | (1.2 | ) | 327.5 | |||||||||||
Operating (loss) income | (183.2 | ) | (106.6 | ) | 1.2 | (75.4 | ) | |||||||||
Other expenses: | ||||||||||||||||
Interest expense, net | 16.0 | — | — | 16.0 | ||||||||||||
Financing costs amortization | 1.3 | — | — | 1.3 | ||||||||||||
Foreign currency loss | 1.3 | 0.6 | — | 0.7 | ||||||||||||
Other expenses, net | 18.6 | 0.6 | — | 18.0 | ||||||||||||
(Loss) income before income taxes | (201.8 | ) | (107.2 | ) | 1.2 | (93.4 | ) | |||||||||
Income tax expense (benefit), net | 2.7 | (5.4 | ) | 0.4 | (h) | 8.5 | ||||||||||
Net (loss) income | (204.5 | ) | (101.8 | ) | 0.8 | (101.9 | ) | |||||||||
Less: Loss attributable to noncontrolling interests, net of taxes | (1.5 | ) | — | — | (1.5 | ) | ||||||||||
Net (loss) income attributable to Chart Industries, Inc. | $ | (203.0 | ) | $ | (101.8 | ) | $ | 0.8 | $ | (100.4 | ) | |||||
Net loss attributable to Chart Industries, Inc. per common share: | ||||||||||||||||
Basic | $ | (6.66 | ) | $ | (3.29 | ) | ||||||||||
Diluted | $ | (6.66 | ) | $ | (3.29 | ) | ||||||||||
Weighted average number of common shares outstanding: | ||||||||||||||||
Basic | 30.49 | 30.49 | ||||||||||||||
Diluted | 30.49 | 30.49 |
(a) | Represents the disposition of the CAIRE business assets and liabilities which had been reported as “held for sale” as of September 30, 2018. |
(b) | Represents the impact of the $133.5 in cash proceeds received from the Divestiture and an estimated increase to accrued income taxes of $2.6. |
(c) | Represents estimated transaction advisory costs of $2.3, net of taxes. |
(d) | Represents estimated employee-related incentive costs of $1.2, net of taxes. |
(e) | Reflects the impact to Chart’s retained earnings from pro forma adjustments described above. |
(f) | Represents the elimination of the operating results of the CAIRE business in the unaudited statements of operations for the CAIRE business for the periods presented. |
(g) | Reflects costs associated with certain financial and information technology services to be provided on a transitional basis for up to twelve months commencing immediately following the Divestiture subject to the terms and conditions with the Transition Services Agreement. These costs will be reimbursed by the Buyer during the transition period and no longer exist after the transition period. Therefore, this adjustment removes the costs associated with these transition services from the historical financial statements. |
(h) | Reflects the income tax effect of pro forma adjustments based on the estimated blended U.S. federal and state tax rate of 23% for the nine months ended September 30, 2018 and 36% for the years ended December 31, 2017, 2016 and 2015. |