Williams Industrial Services Group Inc. - FORM 8-K - EX-99.2 - UNAUDITED PRO FORMA FINANCIAL STATEMENTS

Attached files

file	filename
8-K - FORM 8-K - Williams Industrial Services Group Inc.	d8k.htm
EX-99.1 - PRESS RELEASE - Williams Industrial Services Group Inc.	dex991.htm

Exhibit 99.2

Global Power Equipment Group Inc.

Unaudited Pro Forma Consolidated Financial Statements

The following unaudited pro forma consolidated financial statements are presented to give effect to the disposition of substantially all of the operating assets of Deltak L.L.C. for $31.0 million in cash subject to a specified working capital adjustment, which closed on August 31, 2011 (“Deltak Disposition”).

The unaudited pro forma consolidated income statement for the year ended December 31, 2010 has been derived from the consolidated income statement of Global Power Equipment Group Inc. (the “Company”) for the year ended December 31, 2010. The unaudited pro forma consolidated income statement should be read together with the Company’s consolidated income statement and the notes thereto included in its Annual Report on Form 10-K for the year ended December 31, 2010.

The unaudited pro forma consolidated balance sheet as of June 30, 2011 and the unaudited pro forma consolidated income statement for the six months ended June 30, 2011 have been derived from the Company’s interim consolidated financial statements included in its Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2011 and should be read in conjunction with those financial statements, including the notes thereto.

The unaudited pro forma consolidated financial statements are based on the following assumptions and adjustments:

•

the income statement data presents the Company’s operations as if the Deltak Disposition had occurred on January 1, 2010; and

•

the balance sheet data presents the Company’s financial position as if the Deltak Disposition had occurred on June 30, 2011.

The unaudited pro forma consolidated financial statements are presented for illustrative purposes only. The financial results may have been different if the Deltak Disposition had occurred as of the dates indicated above. This financial information does not purport to indicate the future results that the Company will experience.

Global Power Equipment Group Inc.

Pro Forma Consolidated Statements of Operations

Six Months Ended June 30, 2011

(In thousands, except share and per share amounts)


	As Reported			Less: Deltak Disposition			Pro Forma
Products revenue	$	93,426		$	18,485	(a)	$	74,941
Services revenue		167,670			—			167,670

Total revenue		261,096			18,485			242,611
Costs of products revenue		74,197			14,019	(a)		60,178
Costs of services revenue		147,313						147,313

Cost of Revenues		221,510			14,019	(a)		207,491

Gross Profit		39,586			4,466	(a)		35,120
Selling and administrative expenses		27,432			3,329	(a)		24,103

Operating Income		12,154			1,137	(a)		11,017
Interest expense		574			—			574

Income from continuing operations before reorganization items and income taxes		11,580			1,137	(a)		10,443
Reorganization expense (income)		(5	)		—			(5	)

Income from continuing operations before income taxes		11,585			1,137	(a)		10,448
Income tax expense (benefit)		(38,938	)		47	(a)		(38,985	)

Income from continuing operations	$	50,523		$	1,090		$	49,433

Basic earnings per weighted average common share:
Income from continuing operations	$	3.21		$	0.07		$	3.14

Weighted average number of shares of common stock outstanding- basic		15,720,143			15,720,143			15,720,143

Diluted earnings per weighted average common share:
Income from continuing operations	$	2.99		$	0.06		$	2.92

Weighted average number of shares of common stock outstanding- diluted		16,908,745			16,908,745			16,908,745

Global Power Equipment Group Inc.

Pro Forma Consolidated Statements of Operations

Year Ended December 31, 2010

(In thousands, except share and per share amounts)


	As Reported			Less: Deltak Disposition			Pro Forma
Products revenue	$	142,683		$	37,674	(a)	$	105,009
Services revenue		377,461			—			377,461

Total revenue		520,144			37,674			482,470
Costs of products revenue		98,757			22,434	(a)		76,323
Costs of services revenue		318,866						318,866

Cost of Revenues		417,623			22,434	(a)		395,189

Gross Profit		102,521			15,240	(a)		87,281
Selling and administrative expenses		52,872			6,465	(a)		46,407

Operating Income		49,649			8,775	(a)		40,874
Interest expense		7,052			—			7,052

Income from continuing operations before reorganization items and income taxes		42,597			8,775	(a)		33,822
Reorganization expense (income)		(1,477	)		—			(1,477	)

Income from continuing operations before income taxes		44,074			8,775	(a)		35,299
Income tax expense (benefit)		6,410			254	(a)		6,156

Income from continuing operations	$	37,664		$	8,521		$	29,143

Basic earnings per weighted average common share:
Income from continuing operations	$	2.47		$	0.56		$	1.91

Weighted average number of shares of common stock outstanding- basic		15,253,579			15,253,579			15,253,579

Diluted earnings per weighted average common share:
Income from continuing operations	$	2.31		$	0.52		$	1.79

Weighted average number of shares of common stock outstanding- diluted		16,321,203			16,321,203			16,321,203

Global Power Equipment Group Inc.

Pro Forma Consolidated Balance Sheet

As of June 30, 2011

(In thousands)


	As Reported			Less: Deltak Disposition			Pro Forma
ASSETS
Current assets:
Cash & Cash Equivalents	$	53,636			19,249	(b),(d)	$	72,885
Restricted cash		1,019			3,100	(b)		4,119
Accounts receivable, net		52,684			(1,572	)(c)		51,112
Inventory		6,421			(631	)(c)		5,790
Costs and estimated earnings in excess of billings		50,030			(1,027	)(c)		49,003
Deferred tax - current		7,085						7,085
Other current assets		6,120			(85	)(c)		6,035

Total current assets		176,995			19,034			196,029
Property, plant and equipment, net		13,038			(4,501	)(c)		8,537
Goodwill		80,400			(10,182	)(c)		70,218
Intangible assets, net		12,500			—			12,500
Deferred tax assets, long-term		16,121			(5,497	)(d)		10,624
Other assets		1,516			3,850	(b)		5,366

Total assets	$	300,570		$	2,704		$	303,274

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	15,501		$	(1,163	)(c)	$	14,338
Accrued compensation and employee benefits		15,207			(950	) (c)		14,257
Accrued warranties		6,116			—			6,116
Billings in excess of costs and estimated earnings		16,916			(3,991	)(c)		12,925
Other current liabilities		10,756			(220	)(c)		10,536

Total current liabilities		64,496			(6,324	)		58,172
Long-term deferred tax liability		—			—			—
Other long-term liabilities		4,345			—			4,345
Liabilities subject to compromise		—			—			—

Total liabilities		68,841			(6,324	)		62,517
Commitments and contingencies
Stockholders’ equity:
Common stock		1,409			—			1,409
Paid-In capital		64,733			431	(d)		65,164
Accumulated other comprehensive income		3,443			—			3,443
Retained earnings		162,152			8,597	(d)		170,749
Treasury stock		(8	)		—			(8	)

Total stockholders’ equity		231,729			9,028			240,757

Total liabilities and stockholders’ equity	$	300,570		$	2,704		$	303,274

Global Power Equipment Group Inc.

Notes to Unaudited Pro Forma Consolidated Financial Statements

a)	Represents adjustments to remove the historical results of operations of the Deltak Disposition and the related income taxes, net of general corporate expenses that will remain with the Company.

Represents cash proceeds of $31.0 million from the Deltak Disposition, less an estimate for the working capital adjustment $2.8 million, $3.1million in short-term and $3.8 million in long-term restricted cash, respectively, to meet escrow requirements for potential warranty claims and other post-closing obligations. The actual amount of the working capital and post-closing settlements may differ substantially from the amount estimated at June 30, 2011.

c)	Represents the elimination of the net assets subject to Deltak Disposition, which are included in the historical financial results of the Company, net of certain assets, liabilities and customer warranties that are retained by the Company.

d)	Represents the assumed gain associated with the Deltak Disposition, which has been calculated as follows (in millions):


Gross proceeds	$	31,000
Adjusted for:
Working capital		(2,820	)
Net book value of assets disposed		(11,674	)
Transaction costs		(2,412	)

Pre-tax (gain)		14,094
Income taxes		(5,497	)

Pro forma (gain) on disposition, net of tax	$	8,597

Transaction costs include brokerage fees, legal fees, and cash and stock-based compensation due to Deltak employees. The assumed gain includes certain estimates, which will be revised when actual data is available. The actual gain will depend on the book values of the disposed assets and related liabilities at the closing date. Additionally, the actual gain is subject to final post closing adjustment for working capital and customer warranties. The gain has not been reflected in the accompanying pro forma consolidated income statements.

Attached files

Stock widget

Investing forum

Williams Industrial Services Group Inc. Reports