HILLMAN COMPANIES INC - FORM 10-K - EX-99.1 - EXHIBIT 99.1 - March 27, 2020

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EX-32.2 - EXHIBIT 32.2 - HILLMAN COMPANIES INCexhibit322-122819.htm
EX-32.1 - EXHIBIT 32.1 - HILLMAN COMPANIES INCexhibit321-122819.htm
EX-31.2 - EXHIBIT 31.2 - HILLMAN COMPANIES INCexhibit312-122819.htm
EX-31.1 - EXHIBIT 31.1 - HILLMAN COMPANIES INCexhibit311-122819.htm
EX-21.1 - EXHIBIT 21.1 - HILLMAN COMPANIES INCexhibit211-122819.htm
EX-10.15 - EXHIBIT 10.15 - HILLMAN COMPANIES INCexhibit101512282019.htm
EX-10.14 - EXHIBIT 10.14 - HILLMAN COMPANIES INCexhibit101412282019.htm
EX-10.13 - EXHIBIT 10.13 - HILLMAN COMPANIES INCexhibit101312282019.htm
EX-10.12 - EXHIBIT 10.12 - HILLMAN COMPANIES INCexhibit101212282019.htm
10-K - 10-K - HILLMAN COMPANIES INChillman10-k12282019.htm


EXHIBIT 99.1
 
THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES
Reconciliation Statement, Non-GAAP Basis
(dollars in thousands)
Unaudited

EBITDA and Adjusted EBITDA are not measures made in accordance with U.S. generally accepted accounting principles (“GAAP”), and as such, should not be considered a measure of financial performance or condition, liquidity, or profitability. It should not be considered an alternative to GAAP-based net income or income from operations or operating cash flows. Further, because not all companies use identical calculations, amounts reflected by Hillman as EBITDA and Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Adjusted EBITDA is included to satisfy a reporting obligation under our indenture. Adjusted EBITDA as presented herein does not include certain adjustments and pro forma run rate measures contemplated by our senior secured credit facilities and our indenture and may also include additional adjustments that were not applicable at the time of the offering of the senior notes governed by our indenture. Adjusted EBITDA is also one of the performance criteria for the Company's annual performance-based bonus plan.

The reconciliation of Net income (loss) to EBITDA and Adjusted EBITDA for the years ended December 29, 2019 and December 29, 2018 follows:
 
 
Thirteen Weeks Ended
 
Year Ended
 
 
December 28,
 
December 29,
 
December 28,
 
December 29,
 
 
2019
 
2018
 
2019
 
2018
Net loss
 
$
(34,097
)
 
$
(35,085
)
 
$
(103,386
)
 
$
(69,641
)
Income tax provision (benefit)
 
(3,524
)
 
(112
)
 
(5,370
)
 
2,070

Interest expense, net
 
24,104

 
26,491

 
101,613

 
70,545

Interest expense on junior subordinated debentures
 
3,152

 
3,152

 
12,608

 
12,608

Investment income on trust common securities
 
(94
)
 
(94
)
 
(378
)
 
(378
)
Depreciation
 
16,918

 
15,580

 
65,658

 
46,060

Amortization
 
14,796

 
14,700

 
58,910

 
44,572

EBITDA
 
21,255

 
24,632

 
129,655

 
105,836

 
 
 
 
 
 
 
 
 
   Stock compensation expense
 
1,075

 
371

 
2,981

 
1,590

   Management fees
 
166

 
150

 
562

 
546

   Acquisition and integration expense
 
707

 
3,775

 
5,932

 
10,953

   Canada Restructuring (1)
 
6,556

 
5,587

 
9,667

 
8,261

   US Restructuring costs (2)
 
8,198

 
—

 
9,527

 
—

   Restructuring and other costs (3)
 
2,115

 
1,528

 
13,000

 
9,016

   Refinancing costs
 
—

 
3,090

 
—

 
11,632

   Retention and long term incentive bonuses
 
742

 
1,405

 
6,831

 
1,405

   Asset impairment costs(4) 
 
991

 
—

 
7,887

 
—

   Legal fees and settlements
 
651

 
—

 
1,463

 
—

   Anti-dumping duties
 
—

 
300

 
—

 
(3,829
)
   Mark-to-market adjustment on interest rate swaps
 
(609
)
 
2,284

 
2,608

 
607

Adjusted EBITDA
 
$
41,847

 
$
43,122

 
$
190,113

 
$
146,017


1.
Includes charges related to a restructuring plan announced in our Canada segment in 2018, including facility consolidation, stock keeping unit rationalization, severance, sale of property and equipment, and charges relating to exiting certain lines of business. See Note 14 - Restructuring of the Notes to the Consolidated Financial statements for additional information.
2.
Includes charges related to a restructuring plan announced in our United States business in 2019, including severance related to management realignment and the integration of sales and operating functions, and inventory adjustments



driven by a strategic review of the Company's product offerings. See Note 14 - Restructuring of the Notes to the Consolidated Financial statements for additional information.
3.
Includes restructuring and other costs associated with the implementation of a new pricing program, cost associated with implementing our ERP system in Canada, costs to relocate our distribution center in Edmonton, Canada, costs associated with relocating our distribution center in Dallas, Texas, and one time charges associated with new business wins.
4.
Impairment losses for the disposal of FastKey self-service key duplicating kiosks and related assets.



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