PATTERSON COMPANIES, INC. - FORM 8-K - EX-99.1

Attached files

file	filename
8-K - 8-K - PATTERSON COMPANIES, INC.	d70072d8k.htm
EX-99.2 - EX-99.2 - PATTERSON COMPANIES, INC.	d70072dex992.htm

Exhibit 99.1

The following unaudited pro forma consolidated financial statements are based on the consolidated financial statements of Patterson Companies, and are adjusted to give effect to the event described in the Form 8-K to which this exhibit is attached as if that event occurred at an earlier date. The unaudited pro forma consolidated statements of income for the fiscal years ended April 25, 2015, April 26, 2014 and April 27, 2013 are adjusted to reflect the sale of Patterson Medical as if it occurred on April 29, 2012. The unaudited pro forma balance sheet is adjusted to reflect the sale of Patterson Medical as if it occurred on April 25, 2015, the last day of the most recently filed period.

The unaudited pro forma consolidated financial statements are provided for illustrative purposes only and, therefore, are not necessarily indicative of the operating results or financial position that might have been achieved had the event described in the Form 8-K to which this exhibit is attached occurred as of an earlier date, nor are they necessarily indicative of future operating results or financial position. The unaudited pro forma consolidated financial statements should be read in conjunction with the historical consolidated financial statements and notes thereto in the Annual Report on Form 10-K for the fiscal year ended April 25, 2015.

PATTERSON COMPANIES, INC.

PRO FORMA CONSOLIDATED BALANCE SHEET

(In thousands)


	April 25, 2015
	Historical Financial Statement			Pro Forma Adjustment – Medical (a)			Pro Forma Financial Statement
ASSETS
Current assets:
Cash and cash equivalents	$	347,260		$	(715,000	)	$	1,062,260
Short-term investments		53,372			—			53,372
Receivables, net of allowance for doubtful accounts		644,139			57,876			586,263
Inventory		456,687			48,265			408,422
Prepaid expenses and other current assets		71,767			12,206			59,561

Total current assets		1,573,225			(596,653	)		2,169,878
Property and equipment, net		226,805			22,672			204,133
Long-term receivables, net		71,686			—			71,686
Goodwill		837,099			537,175			299,924
Identifiable intangibles, net		199,829			74,804			125,025
Other		39,062			1,143			37,919

Total assets	$	2,947,706		$	39,141		$	2,908,565


LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	349,635		$	26,341		$	323,294
Accrued payroll expense		79,964			7,500			72,464
Other accrued liabilities		148,086			(8,127	)(b)		156,213

Total current liabilities		577,685			25,714			551,971
Long-term debt		725,000			—			725,000
Deferred income taxes		88,264			46,851			41,413
Other		42,634			2,563			40,071

Total liabilities		1,433,583			75,128			1,358,455
Stockholders’ equity:
Common stock		1,033			—			1,033
Additional paid-in capital		21,026			—			21,026
Accumulated other comprehensive income (loss)		(60,346	)		(13,795	)		(46,551	)
Retained earnings		1,630,148			(22,192	)(c)		1,652,340
Unearned ESOP shares		(77,738	)		—			(77,738	)

Total stockholders’ equity		1,514,123			(35,987	)		1,550,110

Total liabilities and stockholders’ equity	$	2,947,706		$	39,141		$	2,908,565

(a)	Reflects the elimination of Patterson Medical’s historical assets, liabilities and accumulated comprehensive income amounts, and the receipt of $715,000 of cash proceeds upon sale.

(b)	Reflects historical other accrued liabilities less estimated income taxes payable resulting from the gain on sale of Patterson Medical.

(c)	Reflects the estimated gain on sale of Patterson Medical, less estimated income taxes payable. The actual gain to be recognized will be adjusted by the actual closing adjustments and actual transaction fees incurred.

PATTERSON COMPANIES, INC.

PRO FORMA CONSOLIDATED STATEMENT OF INCOME

(In thousands, except per share amounts)


	Fiscal Year Ended April 25, 2015
	Historical Financial Statement			Pro Forma Adjustment – Medical			Pro Forma Financial Statement
Net sales	$	4,375,020		$	464,155		$	3,910,865
Cost of sales		3,136,814			286,498			2,850,316

Gross profit		1,238,206			177,657			1,060,549
Operating expenses		864,779			108,816			755,963

Operating income		373,427			68,841	(a)		304,586
Other income and expense:
Other income, net		2,937			(488	)		3,425
Interest expense		(33,693	)		—			(33,693	)

Income before taxes		342,671			68,353			274,318
Income taxes		119,410			25,175	(b)		94,235

Net income	$	223,261		$	43,178		$	180,083


Earnings per share:
Basic	$	2.26		$	0.44		$	1.82

Diluted	$	2.24		$	0.43		$	1.81


Weighted average shares:
Basic		98,989			98,989			98,989

Diluted		99,694			99,694			99,694

(a)

Reflects the elimination of Patterson Medical’s historical segment operating results, adjusted to exclude $2,655 of distribution costs, $1,333 of shared branch expenses, and $827 of compensation expenses consistent with the accounting requirements of presenting discontinued operations. Also, consistent with discontinued operations accounting requirements, $3,156 of divestiture-related transaction costs incurred by Patterson Medical during the period that were not included in Patterson Medical’s historical segment results have been included in the Pro Forma Adjustment-Medical results.

(b)	Income taxes have been allocated to Patterson Medical based on the accounting requirements for presenting discontinued operations.

PATTERSON COMPANIES, INC.

PRO FORMA CONSOLIDATED STATEMENT OF INCOME

(In thousands, except per share amounts)


	Fiscal Year Ended April 26, 2014
	Historical Financial Statement			Pro Forma Adjustment – Medical			Pro Forma Financial Statement
Net sales	$	4,063,715		$	478,574		$	3,585,141
Cost of sales		2,865,437			298,993			2,566,444

Gross profit		1,198,278			179,581			1,018,697
Operating expenses		852,522			127,551			724,971

Operating income		345,756			52,030	(a)		293,726
Other income and expense:
Other income, net		2,869			(381	)		3,250
Interest expense		(35,713	)		—			(35,713	)

Income before taxes		312,912			51,649			261,263
Income taxes		112,300			22,369	(b)		89,931

Net income	$	200,612		$	29,280		$	171,332


Earnings per share:
Basic	$	1.99		$	0.29		$	1.70

Diluted	$	1.97		$	0.28		$	1.69


Weighted average shares:
Basic		100,727			100,727			100,727

Diluted		101,643			101,643			101,643

(a)	Reflects the elimination of Patterson Medical’s historical segment operating results, adjusted to exclude $2,626 of distribution costs, $1,333 of shared branch expenses, and $1,308 of compensation expenses consistent with the accounting requirements of presenting discontinued operations.

(b)	Income taxes have been allocated to Patterson Medical based on the accounting requirements for presenting discontinued operations.

PATTERSON COMPANIES, INC.

PRO FORMA CONSOLIDATED STATEMENT OF INCOME

(In thousands, except per share amounts)


	Fiscal Year Ended April 27, 2013
	Historical Financial Statement			Pro Forma Adjustment – Medical			Pro Forma Financial Statement
Net sales	$	3,637,212		$	501,997		$	3,135,215
Cost of sales		2,446,443			307,975			2,138,468

Gross profit		1,190,769			194,022			996,747
Operating expenses		836,314			124,782			711,532

Operating income		354,455			69,240	(a)		285,215
Other income and expense:
Other income, net		3,059			332			2,727
Interest expense		(36,397	)		—			(36,397	)

Income before taxes		321,117			69,572			251,545
Income taxes		110,845			24,216	(b)		86,629

Net income	$	210,272		$	45,356		$	164,916

Earnings per share:
Basic	$	2.04		$	0.44		$	1.60

Diluted	$	2.03		$	0.44		$	1.59

Weighted average shares:
Basic		103,030			103,030			103,030

Diluted		103,807			103,807			103,807

(a)	Reflects the elimination of Patterson Medical’s historical segment operating results, adjusted to exclude $2,233 of distribution costs, $1,346 of shared branch expenses, and $634 of compensation expenses consistent with the accounting requirements of presenting discontinued operations.

(b)	Income taxes have been allocated to Patterson Medical based on the accounting requirements for presenting discontinued operations.

Attached files

Stock widget

Investing forum

PATTERSON COMPANIES, INC. Reports

Also read