Attached files
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8-K - FORM 8-K - Solo Cup CO | d8k.htm |
Exhibit 99.1
Solo Cup Company and Subsidiaries
Consolidated Statements of Operations
(In millions)
Q4 2009 | Q4 2008 | YTD 2009 |
YTD 2008 |
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Net sales |
$ | 387.0 | $ | 404.3 | $ | 1,502.6 | $ | 1,847.0 | ||||||||
Cost of goods sold |
336.1 | 360.8 | 1,296.2 | 1,599.2 | ||||||||||||
Gross profit |
50.9 | 43.5 | 206.4 | 247.8 | ||||||||||||
Selling, general and administrative expenses |
37.5 | 29.2 | 150.1 | 159.6 | ||||||||||||
Impairment of goodwill |
| | 17.2 | | ||||||||||||
Loss on asset disposals |
1.5 | 4.0 | 9.0 | 22.6 | ||||||||||||
Operating income |
11.9 | 10.3 | 30.1 | 65.6 | ||||||||||||
Interest expense, net |
17.7 | 15.3 | 63.1 | 61.6 | ||||||||||||
Reclassification of unrealized loss on cash flow hedges to interest expense |
| | 9.1 | | ||||||||||||
Loss on debt extinguishment |
| | 2.5 | | ||||||||||||
Foreign currency exchange (gain) loss, net |
(0.2 | ) | 10.9 | (2.6 | ) | 14.1 | ||||||||||
Loss from continuing operations before income taxes |
(5.6 | ) | (15.9 | ) | (42.0 | ) | (10.1 | ) | ||||||||
Income tax (benefit) provision |
(1.1 | ) | (2.4 | ) | (6.3 | ) | 2.1 | |||||||||
Loss from continuing operations |
(4.5 | ) | (13.5 | ) | (35.7 | ) | (12.2 | ) | ||||||||
Loss from discontinued operations, net of income taxes |
| (0.1 | ) | | (0.7 | ) | ||||||||||
Gain on sale of discontinued operations, net of income taxes |
| 0.8 | | 0.8 | ||||||||||||
Net loss |
$ | (4.5 | ) | $ | (12.8 | ) | $ | (35.7 | ) | $ | (12.1 | ) | ||||
Reconciliation of net loss to EBITDA (non-GAAP measure) | Q4 2009 | Q4 2008 | YTD 2009 |
YTD 2008 |
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Net loss(1) |
$ | (4.5 | ) | $ | (12.8 | ) | $ | (35.7 | ) | $ | (12.1 | ) | ||||
Interest expense, net (includes reclassification of unrealized loss on cash flow hedges and debt extinguishment) |
17.7 | 15.3 | 74.7 | 61.6 | ||||||||||||
Income tax (benefit) provision |
(1.1 | ) | (2.4 | ) | (6.3 | ) | 2.1 | |||||||||
Depreciation and amortization |
18.1 | 18.0 | 70.0 | 77.7 | ||||||||||||
EBITDA (non-GAAP measure) |
$ | 30.2 | $ | 18.1 | $ | 102.7 | $ | 129.3 | ||||||||
(1) | Net loss includes the following items, which are listed here to provide information for purposes of additional analysis. |
Q4 2009 | Q4 2008 | YTD 2009 |
YTD 2008 | ||||||||||||
Plant closure expenses and severance costs |
$ | 1.8 | $ | 3.7 | $ | 13.3 | $ | 11.1 | |||||||
Closed plant inefficiencies |
| 2.3 | 1.0 | 6.5 | |||||||||||
Impairment of goodwill |
| | 17.2 | | |||||||||||
Asset impairment |
| 0.6 | | 0.6 | |||||||||||
Loss on asset disposals |
1.5 | 4.0 | 9.0 | 22.6 | |||||||||||
Foreign currency exchange (gain) loss, net |
(0.2 | ) | 10.9 | (2.6 | ) | 14.1 | |||||||||
Long-term incentive plan |
| (1.1 | ) | 0.4 | 1.2 | ||||||||||
Contractual resolution charge |
| | 3.9 | |
STATEMENT REGARDING USE OF NON-GAAP MEASURES
EBITDA, defined as net income (loss) before interest, taxes, depreciation and amortization, is a non-GAAP financial measure, and should not be considered as an alternative to net income (loss) as a measure of financial or operating performance, as an alternative to cash flows provided by operating, investing and financing activities as a measure of liquidity, or as an alternative to any other financial measure calculated in accordance with generally accepted accounting principles. EBITDA is presented to provide additional information regarding the Companys current financial and operating performance by excluding certain items that may not be indicative of the Companys core operating results. Management believes that EBITDA provides useful information to the Company and its investors, and is frequently utilized by security analysts, lenders and other interested parties to evaluate companies in our industry. In addition, because the Company has historically provided EBITDA measures to investors and other interested parties as required under certain of our previous financing arrangements, management believes that EBITDA provides consistency in the Companys financial reporting and is a useful supplemental measure in comparing the Companys general operating performance from period to period.
Solo Cup Company and Subsidiaries
Consolidated Condensed Balance Sheets
(In millions)
December 27, 2009 | December 28, 2008 | |||||
Assets |
||||||
Cash and cash equivalents |
$ | 30.0 | $ | 57.5 | ||
Accounts receivable, net |
124.9 | 124.0 | ||||
Inventories |
233.0 | 283.3 | ||||
Deferred income taxes |
19.1 | 21.9 | ||||
Other current assets |
29.4 | 38.9 | ||||
Total current assets |
436.4 | 525.6 | ||||
Property, plant and equipment, net |
509.0 | 511.1 | ||||
Other assets |
42.0 | 37.1 | ||||
Total assets |
$ | 987.4 | $ | 1,073.8 | ||
Liabilities and Shareholders Equity |
||||||
Accounts payable |
$ | 82.0 | $ | 74.8 | ||
Accrued expenses |
29.8 | 57.5 | ||||
Current maturities of long-term debt |
0.8 | 1.4 | ||||
Other current liabilities |
72.9 | 45.5 | ||||
Total current liabilities |
185.5 | 179.2 | ||||
Long-term debt, net of current maturities |
635.3 | 716.8 | ||||
Deferred income taxes |
22.7 | 30.9 | ||||
Other liabilities |
125.7 | 115.6 | ||||
Total liabilities |
969.2 | 1,042.5 | ||||
Total shareholders equity |
18.2 | 31.3 | ||||
Total liabilities and shareholders equity |
$ | 987.4 | $ | 1,073.8 | ||
Solo Cup Company and Subsidiaries
Consolidated Condensed Statements of Cash Flows
(In millions)
YTD 2009 |
YTD 2008 |
|||||||
Cash flows from operating activities |
||||||||
Net loss |
$ | (35.7 | ) | $ | (12.1 | ) | ||
Loss from discontinued operations, net of income taxes |
| 0.6 | ||||||
Gain on sale of discontinued operations, net of income taxes |
| (0.7 | ) | |||||
Loss from continuing operations |
(35.7 | ) | (12.2 | ) | ||||
Adjustments to reconcile loss from continuing operations to net cash provided by operating activities: |
||||||||
Depreciation and amortization |
70.0 | 77.7 | ||||||
Deferred financing fee amortization |
6.0 | 4.5 | ||||||
Impairment of goodwill |
17.2 | | ||||||
Asset impairment |
| 0.6 | ||||||
Loss on asset disposals |
9.0 | 22.6 | ||||||
Loss on debt extinguishment |
2.5 | | ||||||
Reclassification of unrealized loss on cash flow hedges |
9.1 | | ||||||
Deferred income taxes |
(8.6 | ) | (0.8 | ) | ||||
Foreign currency exchange (gain) loss, net |
(2.6 | ) | 14.1 | |||||
Changes in operating assets and liabilities |
68.7 | 26.7 | ||||||
Other, net |
2.3 | (0.7 | ) | |||||
Net cash provided by operating activities-continuing operations |
137.9 | 132.5 | ||||||
Net cash used in operating activities-discontinued operations |
| (0.6 | ) | |||||
Net cash provided by operating activities |
137.9 | 131.9 | ||||||
Cash flows from investing activities |
||||||||
Purchase of property, plant and equipment |
(71.8 | ) | (79.7 | ) | ||||
Proceeds from sale of discontinued operations |
| 0.8 | ||||||
Proceeds from sale of property, plant and equipment |
16.6 | 10.5 | ||||||
Increase in restricted cash |
(10.4 | ) | | |||||
Net cash used in investing activities |
(65.6 | ) | (68.4 | ) | ||||
Cash flows from financing activities |
||||||||
Net repayments under revolving credit facilities |
(13.0 | ) | (2.1 | ) | ||||
Borrowings under the 10.5% Senior Secured Notes |
293.8 | | ||||||
Repayment of term notes |
(363.2 | ) | (38.1 | ) | ||||
Repayment of other debt |
(0.3 | ) | (0.1 | ) | ||||
Debt issuance costs |
(18.3 | ) | | |||||
Net cash used in financing activities |
(101.0 | ) | (40.3 | ) | ||||
Effect of exchange rate changes on cash |
1.2 | 0.7 | ||||||
Net (decrease) increase in cash and cash equivalents |
(27.5 | ) | 23.9 | |||||
Cash and cash equivalents, beginning of period |
57.5 | 33.6 | ||||||
Cash and cash equivalents, end of period |
$ | 30.0 | $ | 57.5 | ||||