EX-99.1 7 ex99p1.txt CONSOLIDATING CONDENSED FINANCIAL STATEMENTS EXHIBIT 99.1 CONDENSED CONSOLIDATING FINANCIAL INFORMATION These statements are provided to comply with the reporting requirements under the indenture for the 8 3/4% Senior Subordinated Notes due in 2008. The following condensed consolidating financial information illustrates the composition of the Parent Guarantor, Issuer, Guarantor Subsidiaries and non-guarantor subsidiaries. The Issuer, the Guarantor Subsidiaries and the non-guarantor subsidiaries comprise all of the direct and indirect subsidiaries of the Parent Guarantor. Management has determined that separate complete financial statements would not provide additional material information that would be useful in assessing the financial composition of the Guarantor Subsidiaries. In December 1998, Mail-Well I Corporation ("Issuer" or "MWI"), the Company's wholly-owned subsidiary, and the only direct subsidiary of the Company, issued $300.0 million aggregate principal amount of 8 3/4% Senior Subordinated Notes ("Senior Notes") due in 2008. The Senior Notes are guaranteed by the majority of the U.S. subsidiaries (the "Guarantor Subsidiaries") of MWI, all of which are wholly owned, and by Mail-Well, Inc. ("Parent Guarantor"). The guarantees are joint and several, full, complete and unconditional. There are no material restrictions on the ability of the Guarantor Subsidiaries to transfer funds to MWI in the form of cash dividends, loans or advances, other than ordinary legal restrictions under corporate law, fraudulent transfer and bankruptcy laws. Investments in subsidiaries are accounted for under the equity method, wherein the investor company's share of earnings and income taxes applicable to the assumed distribution of such earnings are included in net income. In addition, investments increase in the amount of permanent contributions to subsidiaries and decrease in the amount of distributions from subsidiaries. The elimination entries eliminate the equity method investment in subsidiaries and the equity in earnings of subsidiaries, intercompany payables and receivables and other transactions between subsidiaries. CONSOLIDATING CONDENSED STATEMENT OF FINANCIAL POSITION June 30, 2001 (in thousands)
Combined Combined Parent Guarantor Nonguarantor Guarantor Issuer Subsidiaries Subsidiaries Eliminations Consolidated --------- ------ ------------ ------------ ------------ ------------ Current assets: Cash and cash equivalents $ - $ - $ (626) $ 902 $ - $ 276 Receivables, net - 2,399 138,825 38,213 - 179,437 Investment in accounts receivable securitization - - - 122,974 - 122,974 Accounts receivable - other - 141,355 (123,105) 1,566 - 19,816 Inventories, net - 51,399 89,626 22,071 - 163,096 Note receivable from Issuer 147,436 - - - (147,436) - Other current assets 87 24,851 36,130 2,717 (10,506) 53,279 -------- ----------- ----------- ----------- ----------- ------------ Total current assets 147,523 220,004 140,850 188,443 (157,942) 538,878 Investment in subsidiaries 295,627 284,190 74,926 - (654,743) - Property, Plant and Equipment, net - 130,454 338,256 84,062 - 552,772 Intangible assets, net - 47,735 420,890 82,870 - 551,495 Notes receivable from subsidiaries - 784,400 - - (784,400) - Other assets, net 1,425 25,625 55,664 4,412 (41,500) 45,626 -------- ----------- ----------- ----------- ----------- ------------ Total assets $444,575 $ 1,492,408 $ 1,030,586 $ 359,787 $(1,638,585) $ 1,688,771 ======== =========== =========== =========== =========== ============ Current liabilities: Accounts payable $ - $ 53,098 $ 122,842 $ 19,195 $ - $ 195,135 Accrued compensation - 23,491 89,652 6,679 - 119,822 Other current liabilities 10,922 181,398 (331,377) 185,262 (10,506) 35,699 Note payable to Parent - 147,436 - - (147,436) - Current portion of long-term debt - 32,994 2,590 5,960 - 41,544 -------- ---------- ----------- ----------- ----------- ------------ Total current liabilities 10,922 438,417 (116,293) 217,096 (157,942) 392,200 Long-term debt 139,063 704,015 13,879 12,658 - 869,615 Note payable to Issuer - - 784,400 - (784,400) - Deferred income taxes - 28,287 82,735 15,795 (21,508) 105,309 Other long-term liabilities - 26,062 20,924 63 (19,992) 27,057 -------- ----------- ---------- ----------- ----------- ------------ Total liabilities 149,985 1,198,781 785,645 245,612 (983,842) 1,394,181 Shareholders' equity 294,590 295,627 244,941 114,175 (654,743) 294,590 -------- ----------- ----------- ----------- ----------- ------------ Total liabilities and shareholders' equity $444,575 $ 1,492,408 $ 1,030,586 $ 359,787 $(1,638,585) $ 1,688,771 ======== =========== =========== =========== =========== ============
CONSOLIDATING CONDENSED STATEMENT OF FINANCIAL POSITION December 31, 2000 (in thousands)
COMBINED COMBINED PARENT GUARANTOR NONGUARANTOR GUARANTOR ISSUER SUBSIDIARIES SUBSIDIARIES ELIM. CONSOLIDATED --------- ------ ------------ ------------ ----- ------------ Current assets: Cash and cash equivalents $ - $ 9,596 $ (9,846) $ 712 $ - $ 462 Receivables, net - 8,669 151,978 41,883 - 202,530 Investment in accounts receivable Securitization - - - 75,427 - 75,427 Accounts receivable - other - 13,499 5,615 1,063 - 20,177 Inventories, net - 51,359 91,815 23,259 - 166,433 Note receivable from Issuer 147,436 - - - (147,436) - -------- Other current assets 262 25,741 24,399 3,786 (181) 54,007 -------- ---------- ----------- -------- ----------- ---------- Total current assets 147,698 108,864 263,961 146,130 (147,617) 519,036 -------- Investment in subsidiaries 385,505 357,592 64,348 - (807,445) - Property, plant and equipment, net - 132,522 350,964 86,536 - 570,022 Intangible assets, net - 49,455 483,515 86,245 - 619,215 Note receivable from Subsidiaries - 784,400 - - (784,400) - Other assets, net 3,481 55,581 1,101 4,001 (18,882) 45,282 -------- ---------- ----------- -------- ----------- ---------- Total assets $536,684 $1,488,414 $ 1,163,889 $322,912 $(1,758,344) $1,753,555 ======== ========== =========== ======== =========== ========== Current liabilities: Accounts payable $ - $ 32,446 $ 107,569 $ 17,700 $ - $ 157,715 Accrued compensation - 24,556 31,144 7,486 - 63,186 Other current liabilities 11,768 100,773 (184,734) 155,374 (181) 83,000 Note payable to Parent - 147,436 - - (147,436) - Current portion of long-term debt - 30,767 2,662 7,113 - 40,542 -------- ---------- ----------- -------- ----------- ---------- Total current liabilities 11,768 335,978 (43,359) 187,673 (147,617) 344,443 -------- Long-term debt 139,063 718,147 18,471 12,921 - 888,602 -------- Note payable to issuer - - 784,400 - (784,400) - Deferred income taxes - 28,288 66,688 13,469 - 108,445 Other long-term liabilities - 20,496 23,992 606 (18,882) 26,212 -------- ---------- ----------- -------- ----------- ---------- Total liabilities 150,831 1,102,909 850,192 214,669 (950,899) 1,367,702 -------- Shareholders' equity 385,853 385,505 313,697 108,243 (807,445) 385,853 -------- ---------- ----------- -------- ----------- ---------- Total liabilities and shareholders' equity $536,684 $1,488,414 $ 1,163,889 $322,912 $(1,758,344) $1,753,555 ======== ========== =========== ======== =========== ==========
CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS Three-months ended June 30, 2001 (in thousands)
Combined Combined Parent Guarantor Nonguarantor Guarantor Issuer Subsidiaries Subsidiaries Eliminations Consolidated --------- ------ ------------ ------------ ------------ ------------ NET SALES $ - $ 117,231 $ 391,286 $ 62,933 $ - $ 571,450 COST OF SALES - 94,770 302,712 46,865 - 444,347 -------- --------- --------- -------- --------- --------- GROSS PROFIT - 22,461 88,574 16,068 - 127,103 OTHER OPERATING COSTS 92 17,765 74,473 7,182 - 99,512 -------- RESTRUCTURING AND OTHER UNUSUAL CHARGES - 15,725 11,756 1 - 27,482 -------- --------- --------- -------- --------- --------- OPERATING INCOME (LOSS) (92) (11,029) 2,345 8,885 - 109 OTHER (INCOME) EXPENSE Interest expense 1,739 19,476 20,064 800 (19,980) 22,099 Other (income) expense (1,978) (17,625) (606) 453 19,980 224 -------- --------- --------- -------- --------- --------- INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES AND LOSS ON DISPOSAL 147 (12,880) (17,113) 7,632 - (22,214) PROVISION (BENEFIT) FOR INCOME TAXES - (1,775) (7,315) 3,436 - (5,654) -------- --------- --------- -------- --------- --------- INCOME (LOSS) BEFORE EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES AND LOSS ON DISPOSAL 147 (11,105) (9,798) 4,196 - (16,560) --------- EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES (92,672) (81,567) 4,623 - 169,616 - -------- --------- --------- -------- --------- --------- INCOME (LOSS) BEFORE LOSS ON DISPOSAL (92,525) (92,672) (5,175) 4,196 169,616 (16,560) LOSS ON DISPOSAL - - (75,965) - - (75,965) -------- --------- --------- -------- --------- --------- NET INCOME $(92,525) $ (92,672) $ (81,140) $ 4,196 $ 169,616 $ (92,525) ======== ========= ========= ======== ========= =========
CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS Three-months Ended June 30, 2000 (in thousands)
Combined Combined Parent Guarantor Nonguarantor Guarantor Issuer Subsidiaries Subsidiaries Eliminations Consolidated --------- ------ ------------ ------------ ------------ ------------ NET SALES $ - $ 110,180 $ 414,191 $ 60,531 $ - $ 584,902 COST OF SALES - 88,856 313,326 45,617 - 447,799 -------- --------- --------- -------- -------- --------- GROSS PROFIT - 21,324 100,865 14,914 - 137,103 OTHER OPERATING COSTS 59 17,822 70,970 7,321 - 96,172 -------- --------- --------- -------- -------- --------- OPERATING INCOME (LOSS) (59) 3,502 29,895 7,593 - 40,931 OTHER (INCOME) EXPENSE Interest expense 1,972 22,152 8,582 (1,190) (7,572) 23,944 Other (income) expense (2,211) (5,261) (510) 203 7,572 (207) -------- --------- --------- -------- -------- --------- INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES 180 (13,389) 21,823 8,580 - 17,194 PROVISION (BENEFIT) FOR INCOME TAXES - (4,935) 8,116 3,155 - 6,336 -------- --------- --------- -------- -------- --------- INCOME (LOSS) BEFORE EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES 180 (8,454) 13,707 5,425 - 10,858 EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES 11,064 21,141 4,590 - (36,795) - -------- --------- --------- -------- -------- --------- INCOME FROM CONTINUING OPERATIONS 11,244 12,687 18,297 5,425 (36,795) 10,858 DISCONTINUED OPERATIONS - (1,623) 2,009 - - 386 -------- --------- --------- -------- -------- --------- NET INCOME $ 11,244 $ 11,064 $ 20,306 $ 5,425 $(36,795) $ 11,244 ======== ========= ========= ======== ======== =========
CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS Six-months Ended June 30, 2001 (in thousands)
Combined Combined Parent Guarantor Nonguarantor Guarantor Issuer Subsidiaries Subsidiaries Eliminations Consolidated --------- ------ ------------ ------------ ------------ ------------ NET SALES $ - $ 230,054 $ 800,095 $ 131,188 $ - $ 1,161,337 COST OF SALES - 184,931 620,134 98,000 - 903,065 -------- --------- --------- --------- --------- ----------- GROSS PROFIT - 45,123 179,961 33,188 - 258,272 OTHER OPERATING COSTS 183 35,716 150,862 15,460 - 202,221 RESTRUCTURING & OTHER UNUSUAL CHARGES - 15,876 11,759 (153) - 27,482 -------- --------- --------- --------- --------- ----------- OPERATING INCOME (LOSS) (183) (6,469) 17,340 17,881 - 28,569 OTHER (INCOME) EXPENSE Interest expense 3,477 38,244 39,432 2,452 (39,960) 43,645 Other (income) expense (3,954) (34,907) (840) 525 39,960 784 -------- --------- --------- --------- --------- ----------- INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES AND LOSS ON DISPOSAL 294 (9,806) (21,252) 14,904 - (15,860) PROVISION (BENEFIT) FOR INCOME TAXES - (429) (9,353) 6,860 - (2,922) -------- --------- --------- --------- --------- ----------- INCOME (LOSS) BEFORE EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES AND LOSS ON DISPOSAL 294 (9,377) (11,899) 8,044 - (12,938) EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES (89,196) (79,819) 12,956 - 156,059 - -------- --------- --------- --------- --------- ----------- INCOME (LOSS) BEFORE LOSS ON DISPOSAL (88,902) (89,196) 1,057 8,044 156,059 (12,938) --------- LOSS ON DISPOSAL - - (75,965) - - (75,965) -------- --------- --------- --------- --------- ----------- NET INCOME $(88,902) $ (89,196) $ (74,908) $ 8,044 $ 156,059 $ (88,903) ======== ========= ========= ========= ========= ===========
CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS Six-months Ended June 30, 2000 (in thousands)
Combined Combined Parent Guarantor Nonguarantor Guarantor Issuer Subsidiaries Subsidiaries Eliminations Consolidated --------- ------ ------------ ------------ ------------ ------------ NET SALES $ - $ 225,878 $ 737,399 $ 171,267 $ - $ 1,134,544 COST OF SALES - 180,978 561,665 124,741 - 867,384 -------- --------- --------- --------- -------- ----------- GROSS PROFIT - 44,900 175,734 46,526 - 267,160 OTHER OPERATING COSTS 101 34,707 120,114 25,840 - 180,762 -------- --------- --------- --------- -------- ----------- OPERATING INCOME (LOSS) (101) 10,193 55,620 20,686 - 86,398 OTHER (INCOME) EXPENSE Interest expense 4,088 39,164 15,678 (851) (15,143) 42,936 Other (income) expense (4,423) (10,865) (542) 358 15,143 (329) -------- --------- --------- --------- -------- ----------- INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES 234 (18,106) 40,484 21,179 - 43,791 PROVISION (BENEFIT) FOR INCOME TAXES - (6,896) 15,789 8,376 - 17,269 -------- --------- --------- --------- -------- ----------- INCOME (LOSS) BEFORE EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES 234 (11,210) 24,695 12,803 - 26,522 EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES 26,955 40,863 8,749 - (76,567) - -------- --------- --------- --------- -------- ----------- INCOME FROM CONTINUING OPERATIONS 27,189 29,653 33,444 12,803 (76,567) 26,522 DISCONTINUED OPERATIONS - (2,307) 2,009 1,356 - 1,058 -------- --------- --------- --------- -------- ----------- INCOME BEFORE EXTRAORDINARY ITEM 27,189 27,346 35,453 14,159 (76,567) 27,580 EXTRAORDINARY ITEM 1,838 (391) - - - 1,447 -------- --------- --------- --------- -------- ----------- NET INCOME $ 29,027 $ 26,955 $ 35,453 $ 14,159 $(76,567) $ 29,027 ======== ========= ========= ========= ======== ===========