HILLMAN COMPANIES INC - FORM 10-Q - EX-99.1 - EXHIBIT 99.1

Attached files

file	filename
EX-32.2 - EXHIBIT 32.2 - HILLMAN COMPANIES INC	exhibit322-certificationof.htm
EX-32.1 - EXHIBIT 32.1 - HILLMAN COMPANIES INC	exhibit321-certificationof.htm
EX-31.1 - EXHIBIT 31.1 - HILLMAN COMPANIES INC	exhibit311-certificationof.htm
EX-31.2 - EXHIBIT 31.2 - HILLMAN COMPANIES INC	exhibit312-certificationof.htm
10-Q - 10-Q 9.30.2015 - HILLMAN COMPANIES INC	hillman10-q9302015.htm

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information

(dollars in thousands)

EXHIBIT 99.1

On June 30, 2014, affiliates of CCMP Capital Advisors, LLC (“CCMP”) and Oak Hill Capital Partners III, L.P., Oak Hill Capital

Management Partners III, L.P. and OHCP III HC RO, L.P.), together with certain current and former members of Hillman’s

management, consummated a merger transaction (the “Merger Transaction”) pursuant to the terms and conditions of an Agreement and Plan of Merger dated as of May 16, 2014.

The Company, through Hillman Group, had issued $265,000 in aggregate principal amount of 10.875% Senior Notes that were

scheduled to mature on June 1, 2018. In connection with the Merger Transaction, the 10.875% Senior Notes were repaid and

terminated.

Hillman Group issued $330,000 aggregate principal amount of its senior notes due July 15, 2022 (the “6.375% Senior Notes”). The 6.375% Senior Notes, of which $330,000 aggregate principal amount was outstanding as of September 30, 2015, are fully and unconditionally guaranteed on a joint and several basis by The Hillman Companies, Inc., Hillman Investment Company, and certain of the Company’s wholly-owned subsidiaries. The non-guarantor information presented represents our Australian, Canadian, and Mexican subsidiaries.

The following financial information presents condensed consolidating statements of comprehensive loss, balance sheets, and cash flows for the Hillman Group, all guarantor subsidiaries, all non-guarantor subsidiaries, and the eliminations necessary to provide the consolidated results for the Hillman Companies and subsidiaries. For purposes of this presentation, we have accounted for investments in our subsidiaries using the equity method of accounting. The principal consolidating adjustments eliminate investment in subsidiary and intercompany balances and transactions.

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Condensed Consolidating Balance Sheet (Unaudited)
As of September 30, 2015
(dollars in thousands)

					Successor

					Guarantors			Issuer					Non-
					The Hillman			The Hillman		Guarantor			Guarantor			Consolidating
					Companies, Inc.			Group, Inc.		Subsidiaries			Subsidiaries			Adjustments			Consolidated
	ASSETS
	Current assets:
		Cash and cash equivalents			$	1		$	2,846	$	693		$	5,145		$	—		$	8,685
		Restricted investments			855			—		—			—			—			855
		Accounts receivable, net			—			83,658		1,527			26,909			—			112,094
		Inventories, net			—			176,712		5,351			72,056			(749		)	253,370
		Deferred income taxes, net			10,545			277		548			76			(97		)	11,349
		Other current assets			—			7,568		83			3,003			—			10,654
			Total current assets		11,401			271,061		8,202			107,189			(846		)	397,007
		Intercompany notes receivable			105,446			115,317		(5,500		)	(109,817		)	(105,446		)	—
		Intercompany interest receivable			9,174			5,239		—			—			(14,413		)	—
		Investments in subsidiaries			(897,812		)	55,647		4,178			231,221			606,766			—
		Property and equipment, net			—			100,451		328			9,623			—			110,402
		Goodwill			814,413			350,968		3,240			33,155			(584,841		)	616,935
		Other intangibles, net			719,793			—		4,521			40,358			—			764,672
		Restricted investments			1,213			—		—			—			—			1,213
		Deferred income taxes			51,457			143		(1,013		)	3,026			(53,613		)	—
		Deferred financing fees, net			—			21,636		—			—			—			21,636
		Investment in trust common securities			3,261			—		—			—			—			3,261
		Other assets			—			2,533		25			1,978			—			4,536

				Total assets	$	818,346		$	922,995	$	13,981		$	316,733		$	(152,393	)	$	1,919,662

	LIABILITIES AND STOCKHOLDERS' EQUITY
	Current liabilities:
		Accounts payable			$	—		$	53,043	$	416		$	23,743		$	—		$	77,202
		Current portion of senior term loans			—			5,500		—			—			—			5,500
		Current portion of capitalized lease and other obligations			—			212		—			—			—			212
		Intercompany interest payable			—			9,173		—			5,240			(14,413		)	—
		Accrued expenses:
			Salaries and wages		—			6,946		147			1,222			—			8,315
			Pricing allowances		—			3,991		3			3,192			—			7,186
			Income and other taxes		(66		)	2,787		98			846			—			3,665
			Interest		—			4,964		—			—			—			4,964
			Deferred compensation		855			—		—			—			—			855
			Other accrued expenses		—			8,083		39			2,667			—			10,789
				Total current liabilities	789			94,699		703			36,910			(14,413		)	118,688

Page 2 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Condensed Consolidating Balance Sheet (Unaudited)
As of September 30, 2015
(dollars in thousands)

					Successor

					Guarantors			Issuer					Non-
					The Hillman			The Hillman			Guarantor		Guarantor			Consolidating
					Companies, Inc.			Group, Inc.			Subsidiaries		Subsidiaries			Adjustments			Consolidated
	LIABILITIES AND STOCKHOLDERS' EQUITY(CONTINUED)
		Intercompany debt payable			—			105,446			—		—			(105,446		)	—
		Long term senior term loans			—			537,625			—		—			—			537,625
		Bank revolving credit			—			51,000			—		—			—			51,000
		Long term capitalized leases and other obligations			—			268			—		—			—			268
		Long term senior notes			—			330,000			—		—			—			330,000
		Junior subordinated debentures			129,960			—			—		—			—			129,960
		Deferred compensation			1,213			—			—		—			—			1,213
		Deferred income taxes, net			300,961			—			1,992		12,394			(53,710		)	261,637
		Other non-current liabilities			—			6,975			—		331			—			7,306
				Total liabilities	432,923			1,126,013			2,695		49,635			(173,569		)	1,437,697

	Commitments and Contingencies

	Stockholders' Equity:
		Preferred Stock:
			Preferred stock, $.01 par, 5,000 shares authorized, none issued and outstanding at September 30, 2015		—			—			—		—			—			—
		Common Stock:
			Common stock, $.01 par, 5,000 shares authorized, issued and outstanding at September 30, 2015		—			—			50		—			(50		)	—

		Additional paid-in capital			633,002			5,842			10,197		375,287			(479,184		)	545,144
		Accumulated deficit			(247,579		)	(189,086		)	1,039		(24,610		)	426,851			(33,385		)
		Accumulated other comprehensive (loss) income			—			(19,774		)	—		(83,579		)	73,559			(29,794		)
			Total stockholders' equity		385,423			(203,018		)	11,286		267,098			21,176			481,965
				Total liabilities and stockholders' equity	$	818,346		$	922,995		$	13,981	$	316,733		$	(152,393	)	$	1,919,662
					—			—			—		—			—			—

Page 3 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Condensed Consolidating Balance Sheet (Unaudited)
As of December 31, 2014
(dollars in thousands)

					Successor

					Guarantors			Issuer					Non-
					The Hillman			The Hillman		Guarantor			Guarantor			Consolidating
					Companies, Inc.			Group, Inc.		Subsidiaries			Subsidiaries			Adjustments			Consolidated
	ASSETS
	Current assets:
		Cash and cash equivalents			$	1		$	13,191	$	696		$	4,597		$	—		$	18,485
		Restricted investments			494			—		—			—			—			494
		Accounts receivable, net			—			65,270		1,175			23,439			—			89,884
		Inventories, net			—			141,472		5,687			57,885			(321		)	204,723
		Deferred income taxes, net			11,191			277		538			1,331			(98		)	13,239
		Other current assets			—			8,142		124			2,058			—			10,324
			Total current assets		11,686			228,352		8,220			89,310			(419		)	337,149
		Intercompany notes receivable			105,446			112,977		(6,975		)	(106,002		)	(105,446		)	—
		Intercompany interest receivable			—			948		—			—			(948		)	—
		Investments in subsidiaries			(840,201		)	69,419		4,300			271,714			494,768			—
		Property and equipment, net			—			101,299		298			12,934			—			114,531
		Goodwill			789,870			338,696		3,240			37,780			(548,026		)	621,560
		Other intangibles, net			746,714			—		4,682			47,545			—			798,941
		Restricted investments			1,750			—		—			—			—			1,750
		Deferred income taxes			53,715			143		(477		)	(2		)	(53,379		)	—
		Deferred financing fees, net			—			24,407		—			—			—			24,407
		Investment in trust common securities			3,261			—		—			—			—			3,261
		Other assets			—			1,317		25			72			—			1,414

				Total assets	$	872,241		$	877,558	$	13,313		$	353,351		$	(213,450	)	$	1,903,013

	LIABILITIES AND STOCKHOLDERS' EQUITY
	Current liabilities:
		Accounts payable			$	—		$	53,487	$	422		$	12,553		$	—		$	66,462
		Current portion of senior term loans			—			5,500		—			—			—			5,500
		Current portion of capitalized lease and other obligations			—			207		—			—			—			207
		Intercompany interest payable			—			—		—			948			(948		)	—
		Accrued expenses:
			Salaries and wages		—			4,144		120			983			—			5,247
			Pricing allowances		—			3,621		3			3,038			—			6,662
			Income and other taxes		(581		)	2,325		37			1,520			—			3,301
			Interest		—			10,587		—			—			—			10,587
			Deferred compensation		494			—		—			—			—			494
			Other accrued expenses		—			6,990		40			393			—			7,423
				Total current liabilities	(87		)	86,861		622			19,435			(948		)	105,883

Page 4 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information




Condensed Consolidating Balance Sheet (Unaudited)
As of December 31, 2014
(dollars in thousands)

					Successor
					Guarantors			Issuer					Non-
					The Hillman			The Hillman			Guarantor		Guarantor			Consolidating
					Companies, Inc.			Group, Inc.			Subsidiaries		Subsidiaries			Adjustments			Consolidated
	LIABILITIES AND STOCKHOLDERS' EQUITY(CONTINUED)
		Intercompany debt payable			—			105,446			—		—			(105,446		)	—
		Long term senior term loans			—			541,750			—		—			—			541,750
		Long term capitalized leases and other obligations			—			400			—		—			—			400
		Long term senior notes			—			330,000			—		—			—			330,000
		Junior subordinated debentures			130,685			—			—		—			—			130,685
		Deferred compensation			1,750			—			—		—			—			1,750
		Deferred income taxes, net			310,804			—			2,037		14,417			(53,477		)	273,781
		Other non-current liabilities			—			4,359			—		1,262			—			5,621
				Total liabilities	443,152			1,068,816			2,659		35,114			(159,871		)	1,389,870


	Commitments and Contingencies

	Stockholders' Equity:
		Preferred Stock:
			Preferred stock, $.01 par, 5,000 shares authorized, none issued and outstanding at December 31, 2014		—			—			—		—			—			—
		Common Stock:
			Common stock, $.01 par, 5,000 shares authorized, issued and outstanding at December 31, 2014		—			—			50		—			(50		)	—
		Additional paid-in capital			632,602			5,842			10,197		375,287			(479,324		)	544,604
		Accumulated deficit			(203,513		)	(188,780		)	407		(11,484		)	384,433			(18,937		)
		Accumulated other comprehensive (loss) income			—			(8,320		)	—		(45,566		)	41,362			(12,524		)
			Total stockholders' equity		429,089			(191,258		)	10,654		318,237			(53,579		)	513,143
				Total liabilities and stockholders' equity	$	872,241		$	877,558		$	13,313	$	353,351		$	(213,450	)	$	1,903,013

Page 5 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Condensed Consolidating Statements of Comprehensive Loss (Unaudited)
For the three months ended September 30, 2015
(dollars in thousands)

			Successor
			Guarantors			Issuer					Non-
			The Hillman			The Hillman			Guarantor		Guarantor			Consolidating
			Companies, Inc.			Group, Inc.			Subsidiaries		Subsidiaries			Adjustments			Consolidated

	Net sales		$	—		$	167,260		$	5,116	$	37,557		$	—		$	209,933
	Cost of sales (exclusive of depreciation and
		amortization shown separately below)	—			84,928			3,575		25,337			—			113,840
	Selling, general and administrative expenses		312			51,820			990		12,755			—			65,877
	Depreciation		—			7,144			19		448			—			7,611
	Amortization		8,974			—			53		461			—			9,488
	Intercompany administrative (income) expense		—			(109		)	—		109			—			—
	Management fees to related party		—			156			—		—			—			156
	Other expense, net		111			1,252			14		1,151			—			2,528

		(Loss) income from operations	(9,397		)	22,069			465		(2,704		)	—			10,433

	Intercompany interest (income) expense		(3,058		)	3,058			—		—			—			—
	Interest (income) expense, net		(246		)	11,443			—		1,406			—			12,603
	Interest expense on junior subordinated debentures		3,152			—			—		—			—			3,152
	Investment income on trust common securities		(95		)	—			—		—			—			(95		)
		(Loss) income before equity in subsidiaries' income	(9,150		)	7,568			465		(4,110		)	—			(5,227		)
	Equity in subsidiaries' income (loss)		5,127			(2,441		)	—		—			(2,686		)	—

		(Loss) income before income taxes	(4,023		)	5,127			465		(4,110		)	(2,686		)	(5,227		)
		Income tax (benefit) provision	(3,983		)	—			393		(1,597		)	—			(5,187		)

	Net income (loss)		$	(40	)	$	5,127		$	72	$	(2,513	)	$	(2,686	)	$	(40	)

	Other comprehensive (loss) income:
		Foreign currency translation adjustments	—			(4,304		)	—		(13,908		)	11,827			(6,385		)

	Total comprehensive income (loss)		$	(40	)	$	823		$	72	$	(16,421	)	$	9,141		$	(6,425	)

Page 6 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Condensed Consolidating Statements of Comprehensive Income (Unaudited)
For the three months ended September 30, 2014 (Adjusted)
(Amounts in thousands)

			Successor
			Guarantors			Issuer					Non-
			The Hillman			The Hillman			Guarantor		Guarantor			Consolidating
			Companies, Inc.			Group, Inc.			Subsidiaries		Subsidiaries			Adjustments			Consolidated

	Net sales		—			$	151,167		$	5,233	$	39,556		—			$	195,956
	Cost of sales (exclusive of depreciation and
		amortization shown separately below)	—			71,287			3,721		24,647			—			99,655
	Selling, general and administrative expenses		332			45,556			995		11,107			—			57,990
	Transaction, acquisition and integration expenses		—			79			—		—			—			79
	Depreciation		—			8,254			18		705			—			8,977
	Amortization		8,202			772			54		552			—			9,580
	Intercompany administrative (income) expense		—			(108		)	—		108			—			—
	Management and transaction fees to related party		—			138			—		—			—			138
	Other expense (income)		5			(59		)	—		(972		)	—			(1,026		)

		(Loss) income from operations	(8,539		)	25,248			445		3,409			—			20,563

	Intercompany interest (income) expense		(3,057		)	3,057			—		—			—			—
	Interest (income) expense, net		(226		)	13,137			—		1,763			—			14,674
	Interest expense on junior subordinated debentures		3,152			—			—		—			—			3,152
	Investment income on trust common securities		(94		)	—			—		—			—			(94		)
		(Loss) income before equity in subsidiaries' income	(8,314		)	9,054			445		1,646			—			2,831
	Equity in subsidiaries' income (loss)		10,554			891			—		—			(11,445		)	—

		Income (loss) before income taxes	2,240			9,945			445		1,646			(11,445		)	2,831
		Income tax provision	1,306			(609		)	303		897			—			1,897

	Net income (loss)		$	934		$	10,554		$	142	$	749		$	(11,445	)	$	934

	Other comprehensive (loss) income:
		Foreign currency translation adjustments	—			(4,766		)	—		(12,209		)	12,095			(4,880		)

	Total comprehensive income (loss)		$	934		$	5,788		$	142	$	(11,460	)	$	650		$	(3,946	)

Page 7 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Condensed Consolidating Statements of Comprehensive Loss (Unaudited)
For the nine months ended September 30, 2015
(dollars in thousands)


			Successor

			Guarantors			Issuer					Non-
			The Hillman			The Hillman			Guarantor		Guarantor			Consolidating
			Companies, Inc.			Group, Inc.			Subsidiaries		Subsidiaries			Adjustments			Consolidated

	Net sales		$	—		$	479,202		$	15,857	$	112,388		$	—		$	607,447
	Cost of sales (exclusive of depreciation and
		amortization shown separately below)	—			250,055			11,306		74,814			—			336,175
	Selling, general and administrative expenses		612			152,400			3,042		36,118			—			192,172
	Transaction, acquisition and integration expenses		—			257			—		—			—			257
	Depreciation		—			20,612			54		1,453			—			22,119
	Amortization		26,920			—			161		1,442			—			28,523
	Intercompany administrative (income) expense		—			(326		)	—		326			—			—
	Management fees to related party		—			462			—		—			—			462
	Other expense		68			2,514			14		444			—			3,040

		(Loss) income from operations	(27,600		)	53,228			1,280		(2,209		)	—			24,699

	Intercompany interest (income) expense		(9,173		)	9,173			—		—			—			—
	Interest (income) expense, net		(724		)	33,950			—		4,621			—			37,847
	Interest expense on junior subordinated debentures		9,457			—			—		—			—			9,457
	Investment income on trust common securities		(284		)	—			—		—			—			(284		)
		(Loss) income before equity in subsidiaries' income	(26,876		)	10,105			1,280		(6,830		)	—			(22,321		)
	Equity in subsidiaries' income (loss)		6,029			(4,076		)	—		—			(1,953		)	—

		(Loss) income before income taxes	(20,847		)	6,029			1,280		(6,830		)	(1,953		)	(22,321		)
		Income tax (benefit) provision	(6,399		)	—			526		(2,000		)	—			(7,873		)

	Net (loss) income		$	(14,448	)	$	6,029		$	754	$	(4,830	)	$	(1,953	)	$	(14,448	)

	Other comprehensive (loss) income:
		Foreign currency translation adjustments	—			(11,454		)	—		(38,013		)	32,197			(17,270		)

	Total comprehensive (loss) income		$	(14,448	)	$	(5,425	)	$	754	$	(42,843	)	$	30,244		$	(31,718	)

Page 8 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Condensed Consolidating Statements of Comprehensive Income (Unaudited)
For the period from June 30, 2014 through September 30, 2014 (Adjusted)
(Amounts in thousands)


			Successor

			Guarantors			Issuer					Non-
			The Hillman			The Hillman			Guarantor		Guarantor			Consolidating
			Companies, Inc.			Group, Inc.			Subsidiaries		Subsidiaries			Adjustments			Consolidated

	Net sales		—			$	151,167		$	5,233	$	39,556		—			$	195,956
	Cost of sales (exclusive of depreciation and
		amortization shown separately below)	—			71,287			3,721		24,647			—			99,655
	Selling, general and administrative expenses		332			45,556			995		11,107			—			57,990
	Transaction, acquisition and integration expenses		22,018			79			—		—			—			22,097
	Depreciation		—			8,254			18		705			—			8,977
	Amortization		8,202			772			54		552			—			9,580
	Intercompany administrative (income) expense		—			(108		)	—		108			—			—
	Management and transaction fees to related party		—			138			—		—			—			138
	Other expense (income)		5			(59		)	—		(972		)	—			(1,026		)

		(Loss) income from operations	(30,557		)	25,248			445		3,409			—			(1,455		)

	Intercompany interest (income) expense		(3,057		)	3,057			—		—			—			—
	Interest (income) expense, net		(226		)	13,137			—		1,763			—			14,674
	Interest expense on junior subordinated debentures		3,152			—			—		—			—			3,152
	Investment income on trust common securities		(94		)	—			—		—			—			(94		)
		(Loss) income before equity in subsidiaries' income	(30,332		)	9,054			445		1,646			—			(19,187		)
	Equity in subsidiaries' income (loss)		10,555			891			—		—			(11,446		)	—

		Income (loss) before income taxes	(19,777		)	9,945			445		1,646			(11,446		)	(19,187		)
		Income tax (benefit) provision	(4,921		)	(610		)	303		897			—			(4,331		)

	Net (loss) income		$	(14,856	)	$	10,555		$	142	$	749		$	(11,446	)	$	(14,856	)

	Other comprehensive (loss) income:
		Foreign currency translation adjustments	—			(4,766		)	—		(12,209		)	12,095			(4,880		)

	Total comprehensive (loss) income		$	(14,856	)	$	5,789		$	142	$	(11,460	)	$	649		$	(19,736	)

Page 9 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Condensed Consolidating Statements of Comprehensive Income (Loss) (Unaudited)
For the six months ended June 29, 2014
(Amounts in thousands)


			Predecessor

			Guarantors			Issuer					Non-
			The Hillman			The Hillman			Guarantor		Guarantor			Consolidating
			Companies, Inc.			Group, Inc.			Subsidiaries		Subsidiaries			Adjustments		Consolidated

	Net sales		—			$	263,194		$	16,053	$	78,130		—		357,377
	Cost of sales (exclusive of depreciation and
		amortization shown separately below)	—			123,971			11,185		48,186			—		183,342
	Selling, general and administrative expenses		39,324			90,090			3,656		23,692			—		156,762
	Transaction, acquisition and integration expenses		—			31,681			—		—			—		31,681
	Depreciation		—			12,789			48		1,312			—		14,149
	Amortization		9,029			1,543			—		521			—		11,093
	Intercompany administrative (income) expense		—			(216		)	—		216			—		—
	Management and transaction fees to related party		—			15			—		—			—		15
	Other (income) expense, net		(95		)	151			10		(343		)	—		(277		)

		(Loss) income from operations	(48,258		)	3,170			1,154		4,546			—		(39,388		)

	Intercompany interest (income) expense		(6,117		)	6,117			—		—			—		—
	Interest (income) expense, net		(103		)	19,802			—		3,451			—		23,150
	Interest expense on junior subordinated debentures		6,305			—			—		—			—		6,305
	Investment income on trust common securities		(189		)	—			—		—			—		(189		)
		(Loss) income before equity in subsidiaries' income	(48,154		)	(22,749		)	1,154		1,095			—		(68,654		)
	Equity in subsidiaries' (loss) income		(21,498		)	1,251			—		—			20,247		—

		(Loss) income before income taxes	(69,652		)	(21,498		)	1,154		1,095			20,247		(68,654		)
		Income tax (benefit) provision	(25,126		)	—			426		572			—		(24,128		)

	Net (loss) income		$	(44,526	)	$	(21,498	)	$	728	$	523		$	20,247	$	(44,526	)

	Other comprehensive (loss) income:
		Foreign currency translation adjustments	—			(151		)	—		(102		)	158		(95		)

	Total comprehensive (loss) income		$	(44,526	)	$	(21,649	)	$	728	$	421		$	20,405	$	(44,621	)

Page 10 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Consolidating Statement of Cash Flows (Unaudited)
For the nine months ended September 30, 2015
(dollars in thousands)

				Successor

				Guarantors			Issuer						Non-
				The Hillman			The Hillman			Guarantor			Guarantor			Consolidating
				Companies, Inc.			Group, Inc.			Subsidiaries			Subsidiaries			Adjustments		Consolidated

Cash flows from operating activities:
	Net (loss) income			$	(20,477	)	$	10,105		$	754		$	(4,830	)	$	—	$	(14,448	)
	Adjustments to reconcile net (loss) income to net cash
		provided by (used for) operating activities:
		Depreciation and amortization		26,949			20,612			215			2,866			—		50,642
		Gain on sale of property and equipment		—			288			30			(869		)	—		(551		)
		Deferred income tax (benefit) provision		(6,939		)	277			481			(2,278		)	—		(8,459		)
		Deferred financing and original issue discount amortization		(725		)	2,771			—			—			—		2,046
		Stock-based compensation expense		680			—			—			—			—		680
		Other non-cash interest and change in value of interest rate swap		—			2,528			—			—			—		2,528
		Changes in operating items:
			Accounts receivable	—			(18,388		)	(352		)	(6,149		)	—		(24,889		)
			Inventories	—			(34,812		)	336			(21,624		)	—		(56,100		)
			Other assets	(9,173		)	(9,951		)	(1,434		)	19,046			—		(1,512		)
			Accounts payable	—			(444		)	(6		)	12,404			—		11,954
			Other accrued liabilities	515			(896		)	87			1,823			—		1,529
			Other items, net	9,310			(9,512		)	—			(305		)	—		(507		)
		Net cash provided by (used for) operating activities		140			(37,422		)	111			84			—		(37,087		)

Cash flows from investing activities:
	Proceeds from sale of property and equipment			—			—			—			2,230			—		2,230
	Capital expenditures			—			(19,791		)	(114		)	(1,057		)	—		(20,962		)
		Net cash (used for) provided by investing activities		—			(19,791		)	(114		)	1,173			—		(18,732		)

Cash flows from financing activities:
	Repayments of senior term loans			—			(4,125		)	—			—			—		(4,125		)
	Borrowings on revolving credit loans			—			53,000			—			—			—		53,000
	Repaymnets of revolving credit loans			—			(2,000		)	—			—			—		(2,000		)
	Principal payments under capitalized lease obligations			—			(127		)	—			—			—		(127		)
	Proceeds from Holdco sale of stock			400			—			—			—			—		400
	Purchase of Holdco stock from a former member of management			(540		)	—			—			—			—		(540		)
		Net cash (used for) provided by financing activities		(140		)	46,748			—			—			—		46,608

Effect of exchange rate changes on cash				—			120			—			(709		)	—		(589		)

Net (decrease) increase in cash and cash equivalents				—			(10,345		)	(3		)	548			—		(9,800		)
Cash and cash equivalents at beginning of period				1			13,191			696			4,597			—		18,485
Cash and cash equivalents at end of period				$	1		$	2,846		$	693		$	5,145		$	—	$	8,685

Page 11 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Condensed Consolidating Statement of Cash Flows (Unaudited)
Period from June 30, 2014 through September 30, 2014 (Adjusted)
(Amounts in thousands)

				Successor

				Guarantors			Issuer						Non-
				The Hillman			The Hillman			Guarantor			Guarantor			Consolidating
				Companies, Inc.			Group, Inc.			Subsidiaries			Subsidiaries			Adjustments	Consolidated

Cash flows from operating activities:
	Net (loss) income			$	(3,648	)	$	(12,099	)	142			749			—	$	(14,856	)
	Adjustments to reconcile net (loss) income to net cash provided by (used for) operating activities:
		Depreciation and amortization		8,204			9,024			72			1,257			—	18,557
		Loss on sale of property and equipment		—			20			—			—			—	20
		Deferred income tax (benefit) provision		(2,236		)	(875		)	(29		)	1,282			—	(1,858		)
		Deferred financing and original issue discount amortization		226			1,024			—			—			—	1,250
		Stock-based compensation expense		336			—			—			—			—	336
		Other non-cash interest expense and change in value of interest rate swap		—			137			—			—			—	137
		Changes in operating items:
			Accounts receivable	—			(294		)	336			1,885			—	1,927
			Inventories	—			(5,888		)	(153		)	(1,505		)	—	(7,546		)
			Other assets	—			1,620			746			(12,410		)	—	(10,044		)
			Accounts payable	—			(5,700		)	(503		)	6,691			—	488
			Other accrued liabilities	(135		)	(24,954		)	14			(2,766		)	—	(27,841		)
			Other items, net	182,940			(181,335		)	(739		)	41			—	907
		Net cash provided by (used for) operating activities		185,687			(219,320		)	(114		)	(4,776		)	—	(38,523		)

Cash flows from investing activities:
	Purchase of predecessor equity securities			(729,616		)	—			—			—			—	(729,616		)
	Capital expenditures			—			(5,729		)	(24		)	(387		)	—	(6,140		)
		Net cash used for investing activities		(729,616		)	(5,729		)	(24		)	(387		)	—	(735,756		)

Cash flows from financing activities:
	Borrowings of senior term loans			—			550,000			—			—			—	550,000
	Repayments of senior term loans			—			(384,407		)	—			—			—	(384,407		)
	Borrowings of senior notes			—			330,000			—			—			—	330,000
	Repayments of senior notes			—			(265,000		)	—			—			—	(265,000		)
	Proceeds from sale of successor equity securities			542,929			—			—			—			—	542,929
	Capital contribution from board member			1,000			—			—			—			—	1,000
	Financing fees, net			—			(26,355		)	—			—			—	(26,355		)
	Borrowings on revolving credit loans			—			16,000			—			—			—	16,000
	Repayments of revolving credit loans			—			(13,000		)	—			—			—	(13,000		)
	Principal payments under capital lease obligations			—			(47		)	—			—			—	(47		)
		Net cash provided by financing activities		543,929			207,191			—			—			—	751,120

Effect of exchange rate changes on cash				—			1,028			—			(338		)	—	690

Net (decrease) increase in cash and cash equivalents				—			(16,830		)	(138		)	(5,501		)	—	(22,469		)
Cash and cash equivalents at beginning of period				1			21,983			668			10,378			—	33,030
Cash and cash equivalents at end of period				$	1		$	5,153		$	530		$	4,877		—	$	10,561

Page 12 of 13

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

Supplemental Consolidating Guarantor and Non-Guarantor Financial Information



Consolidating Statement of Cash Flows (Unaudited)
For the six months ended June 29, 2014
(dollars in thousands)

				Predecessor

				Guarantors			Issuer						Non-
				The Hillman			The Hillman			Guarantor			Guarantor			Consolidating
				Companies, Inc.			Group, Inc.			Subsidiaries			Subsidiaries			Adjustments		Consolidated

Cash flows from operating activities:
	Net (loss) income			$	(23,029	)	$	(22,749	)	$	728		$	524		$	—	$	(44,526	)
	Adjustments to reconcile net (loss) income to net cash provided by (used for) operating activities:
		Depreciation and amortization		9,029			14,332			48			1,833			—		25,242
		Deferred income tax (benefit) provision		(24,245		)	—			206			(419		)	—		(24,458		)
		Deferred financing and original issue discount amortization		(103		)	1,477			—			—			—		1,374
		Stock-based compensation expense		39,229			—			—			—			—		39,229
		Changes in operating items:
			Accounts receivable	—			(17,638		)	(633		)	(6,996		)	—		(25,267		)
			Inventories	—			(17,769		)	(666		)	584			—		(17,851		)
			Other assets	—			(3,199		)	678			11,320			—		8,799
			Accounts payable	—			25,944			236			(5,369		)	—		20,811
			Interest payable on junior subordinated debentures	1,019			—			—			—			—		1,019
			Other accrued liabilities	(123		)	28,651			(4		)	2,659			—		31,183
			Other items, net	(2,251		)	(1,168		)	(659		)	235			—		(3,843		)
		Net cash (used for) provided by operating activities		(474		)	7,881			(66		)	4,371			—		11,712

Cash flows from investing activities:
	Capital expenditures			—			(12,224		)	(57		)	(652		)	—		(12,933		)
		Net cash (used for) investing activities		—			(12,224		)	(57		)	(652		)	—		(12,933		)

Cash flows from financing activities:
	Repayments of senior term loans			—			(992		)	—			—			—		(992		)
	Principal payments under capitalized lease obligations			—			(84		)	—			—			—		(84		)
	Proceeds from exercise of stock options			474			—			—			—			—		474
		Net cash provided by (used for) financing activities		474			(1,076		)	—			—			—		(602		)

Effect of exchange rate changes on cash				—			(151		)	—			35			—		(116		)

Net (decrease) increase in cash and cash equivalents				—			(5,570		)	(123		)	3,754			—		(1,939		)
Cash and cash equivalents at beginning of period				1			27,553			791			6,624			—		34,969
Cash and cash equivalents at end of period				$	1		$	21,983		$	668		$	10,378		$	—	$	33,030

Page 13 of 13

HILLMAN COMPANIES INC - FORM 10-Q - EX-99.1 - EXHIBIT 99.1 - November 16, 2015

Attached files

HILLMAN COMPANIES INC Reports