Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - ADVANCED ENERGY INDUSTRIES INC | d76945e8vk.htm |
| EX-99.2 - EX-99.2 - ADVANCED ENERGY INDUSTRIES INC | d76945exv99w2.htm |
Exhibit 99.1
ADVANCED ENERGY INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION
On October 15, 2010, Advanced Energy Industries, Inc. (“Advanced Energy”) completed the
previously reported sale of its gas flow control business, which includes the Aera® mass flow
control and related product lines (the “Assets”), to Hitachi Metals, Ltd., pursuant to the Asset
Purchase Agreement dated July 21, 2010 between Advanced Energy and Hitachi (the “Purchase
Agreement”). The cash proceeds from the sale of the Assets were approximately $44.9 million, after
adjustments of approximately $1.2 million for inventory as of the closing date and deduction of
approximately $352,000 for certain assets retained by Advanced Energy (the “Asset Disposition”).
The Assets include, without limitation, inventory, real property in Hachioji, Japan, equipment,
certain contracts and intellectual property rights related to the gas flow control business.
In connection with the closing of the Asset Disposition, Advanced Energy entered into a Master
Services Agreement and a Supplemental Transition Services Agreement pursuant to which Advanced
Energy will provide certain transition services and Advanced Energy became an authorized service
provider for Hitachi in all countries other than Japan.
The Unaudited Pro Forma Condensed Consolidated Statement of Operations for the fiscal year ended
December 31, 2009 assumes that the Asset Disposition took place on January 1, 2009, the first day
of Advanced Energy’s fiscal year 2009.
Advanced Energy has not presented the unaudited Pro Forma Condensed Consolidated Statement of
Operations for the six months ended June 30, 2010, as the results of operations of its gas flow
control business were reported as discontinued operations in the Company’s Quarterly Report on Form
10-Q for the quarter ended June 30, 2010, filed with the Securities and Exchange Commission (the
“SEC”) on August 4, 2010.
The Unaudited Pro Forma Condensed Consolidated Balance Sheet assumes that the Asset Disposition
took place on June 30, 2010.
The historical Condensed Consolidated Financial Statements of Advanced Energy have been adjusted in
the Unaudited Pro Forma Condensed Consolidated Financial Statements to give effect to pro forma
events that are (1) directly attributable to the Asset Disposition, (2) factually supportable, and
(3) with respect to the Condensed Consolidated Statement of Operations, expected to have a
continuing impact on the consolidated results.
The Unaudited Pro Forma Condensed Consolidated Financial Statements have been presented for
informational purposes only and is not necessarily indicative of what the Company’s Consolidated
Statements of Financial Position or Results of Operations actually would have been had the Asset
Disposition been completed as of the dates indicated. In addition, the
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Unaudited Pro Forma Condensed Consolidated Financial Statements does not purport to project the
future financial position or operating results of the consolidated Company. Unaudited Pro Forma
Condensed Consolidated Financial Statements, including the notes thereto, should be read in
conjunction with the historical Consolidated Financial Statements of the Company included in its
Annual Report on Form 10-K for the year ended December 31, 2009, filed with the SEC on February 26,
2010 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2010, filed with the SEC
on August 4, 2010. The Unaudited Pro Forma Condensed Consolidated Financial Statements included
herein do not include the operations acquired from PV Powered, Inc. on May 3, 2010. The Company
filed an 8-K on July 12, 2010 that describes the PV Powered, Inc. acquisition, including pro forma
financial statements that present the effect of the acquisition on the historical financial
statements of the Company.
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ADVANCED ENERGY INDUSTRIES, INC. AND SUBSIDIARIES
Pro Forma Condensed Consolidated Statement of Operations (Unaudited)
Year Ended December 31, 2009
(In thousands, except per share amounts)
Pro Forma Condensed Consolidated Statement of Operations (Unaudited)
Year Ended December 31, 2009
(In thousands, except per share amounts)
| Pro Forma | ||||||||||||
| As Reported | Adjustments (a) | Pro Forma | ||||||||||
SALES |
$ | 186,395 | $ | (24,549 | ) | $ | 161,846 | |||||
COST OF SALES |
132,028 | (19,972 | ) | 112,056 | ||||||||
GROSS PROFIT |
54,367 | (4,577 | ) | 49,790 | ||||||||
OPERATING EXPENSES: |
||||||||||||
Research and development |
43,262 | (2,130 | ) | 41,132 | ||||||||
Selling, general and administrative |
41,484 | (3,444 | ) | 38,040 | ||||||||
Impairment of goodwill |
63,260 | — | 63,260 | |||||||||
Amortization of intangible assets |
613 | (491 | ) | 122 | ||||||||
Restructuring charges |
4,376 | — | 4,376 | |||||||||
Total operating expenses |
152,995 | (6,065 | ) | 146,930 | ||||||||
INCOME (LOSS) FROM OPERATIONS |
(98,628 | ) | 1,488 | (97,140 | ) | |||||||
OTHER INCOME (EXPENSE), NET |
1,910 | — | 1,910 | |||||||||
Income (loss) from operations
before income taxes |
(96,718 | ) | 1,488 | (95,230 | ) | |||||||
PROVISION FOR INCOME TAXES |
5,987 | 595 | (b) | 6,582 | ||||||||
NET INCOME (LOSS) |
$ | (102,705 | ) | $ | 893 | $ | (101,812 | ) | ||||
BASIC WEIGHTED-AVERAGE COMMON SHARES
OUTSTANDING |
41,966 | 41,966 | ||||||||||
DILUTED WEIGHTED-AVERAGE COMMON SHARES
OUTSTANDING |
41,966 | 41,966 | ||||||||||
EARNINGS PER SHARE: |
||||||||||||
NET INCOME (LOSS): |
||||||||||||
BASIC EARNINGS PER SHARE |
$ | (2.45 | ) | $ | (2.43 | ) | ||||||
DILUTED EARNINGS PER SHARE |
$ | (2.45 | ) | $ | (2.43 | ) | ||||||
The accompanying notes are an integral part of these Pro Forma Condensed Consolidated Financial Statements.
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ADVANCED ENERGY INDUSTRIES, INC. AND SUBSIDIARIES
Pro Forma Condensed Consolidated Balance Sheet (Unaudited)
As of June 30, 2010
(In thousands)
Pro Forma Condensed Consolidated Balance Sheet (Unaudited)
As of June 30, 2010
(In thousands)
| Pro Forma | ||||||||||||
| As Reported | Adjustments | Pro Forma | ||||||||||
ASSETS |
||||||||||||
CURRENT ASSETS: |
||||||||||||
Cash and cash equivalents |
$ | 116,795 | $ | 44,885 | (c) | $ | 161,680 | |||||
Marketable securities |
12,066 | — | 12,066 | |||||||||
Accounts receivable, net |
75,175 | — | 75,175 | |||||||||
Inventories, net |
56,611 | 2,763 | (d) | 59,374 | ||||||||
Deferred income tax assets |
9,183 | — | 9,183 | |||||||||
Income taxes receivable |
3,245 | — | 3,245 | |||||||||
Assets of business held for sale |
30,180 | (30,180 | )(d) | — | ||||||||
Other current assets |
7,533 | — | 7,533 | |||||||||
Total current assets |
310,788 | 17,468 | 328,256 | |||||||||
PROPERTY AND EQUIPMENT, net |
22,244 | (1,007 | )(d) | 21,237 | ||||||||
OTHER ASSETS: |
||||||||||||
Deposits and other |
8,814 | — | 8,814 | |||||||||
Goodwill |
47,920 | — | 47,920 | |||||||||
Other intangible assets, net |
50,219 | — | 50,219 | |||||||||
Deferred income tax assets |
20,268 | — | 20,268 | |||||||||
Total assets |
$ | 460,253 | $ | 16,461 | $ | 476,714 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||||||
CURRENT LIABILITIES: |
||||||||||||
Accounts payable |
$ | 35,549 | $ | — | $ | 35,549 | ||||||
Income taxes payable |
— | 6,853 | (f) | 6,853 | ||||||||
Accrued payroll and employee benefits |
11,583 | — | 11,583 | |||||||||
Accrued warranty expense |
5,818 | (499 | )(d) | 5,319 | ||||||||
Other accrued expenses |
7,604 | 1,319 | (e) | 8,923 | ||||||||
Customer deposits and deferred revenue |
5,746 | — | 5,746 | |||||||||
Acquisition related contingent liability |
38,967 | — | 38,967 | |||||||||
Liabilities of business held for sale |
1,493 | (1,493 | )(d) | — | ||||||||
Total current liabilities |
106,760 | 6,180 | 112,940 | |||||||||
LONG-TERM LIABILITIES |
||||||||||||
Deferred income tax liabilities |
18,746 | — | 18,746 | |||||||||
Uncertain tax positions |
15,519 | — | 15,519 | |||||||||
Accrued warranty expense |
3,815 | — | 3,815 | |||||||||
Other long-term liabilities |
4,780 | — | 4,780 | |||||||||
Total liabilities |
149,620 | 6,180 | 155,800 | |||||||||
Commitments and contingencies |
||||||||||||
STOCKHOLDERS’ EQUITY: |
||||||||||||
Total stockholders’ equity |
310,633 | 10,281 | (g) | 320,914 | ||||||||
Total liabilities and stockholders’ equity |
$ | 460,253 | $ | 16,461 | $ | 476,714 | ||||||
The accompanying notes are an integral part of these Pro Forma Condensed Consolidated
Financial Statements.
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ADVANCED ENERGY INDUSTRIES, INC. AND SUBSIDARIES
Notes to Pro Forma Condensed Consolidated Financial Statements (Unaudited)
Notes to Pro Forma Condensed Consolidated Financial Statements (Unaudited)
NOTE 1. PRO FORMA ADJUSTMENTS AND ASSUMPTIONS:
| (a) | Reflects the elimination of the results of operations of the gas flow control business. | |
| (b) | A combined income tax rate of 40% has been assumed for the purposes of these Unaudited Pro Forma Condensed Consolidated Financial Statements. | |
| (c) | Represents cash proceeds received from the Purchaser on October 15, 2010. | |
| (d) | Represents the elimination of assets and liabilities transferred to the Purchaser in the Asset Disposition, including revisions to estimates made as of June 30, 2010 of the assets and liabilities to be included in the sale | |
| (e) | Represents estimated transaction costs incurred in connection with the Asset Disposition. | |
| (f) | Represents accrued income taxes on gain on the Asset Disposition. | |
| (g) | Represents estimated gain on the Asset Disposition net of income taxes. |
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