Condensed Consolidating Financial Information (Tables)

9 Months Ended

Sep. 30, 2012

Condensed Consolidating Financial Information

SCHEDULE OF CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the Three Months Ended September 30, 2012

	Neenah Paper, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated Amounts
Net sales	$	108.5		$	35.3		$	62.5	$	—		$	206.3
Cost of products sold	86.4			28.7			55.5		—			170.6
Gross profit	22.1			6.6			7.0		—			35.7
Selling, general and administrative expenses	12.5			2.4			3.6		—			18.5
Acquisition integration costs	0.3			—			—		—			0.3
Other expense - net	—			0.3			0.3		—			0.6
Operating income	9.3			3.9			3.1		—			16.3
Equity in earnings of subsidiaries	(5.1		)	—			—		5.1			—
Interest expense-net	3.2			—			0.1		—			3.3
Income from continuing operations before income taxes	11.2			3.9			3.0		(5.1		)	13.0
Provision for income taxes	2.1			1.6			0.1		—			3.8
Income from continuing operations	9.1			2.3			2.9		(5.1		)	9.2
Loss from discontinued operations, net of income taxes	—			(0.1		)	—		—			(0.1		)
Net income	$	9.1		$	2.2		$	2.9	$	(5.1	)	$	9.1

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the Three Months Ended September 30, 2011

	Neenah Paper, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Amounts
Net sales	$	67.1		$	34.4		$	73.4		$	—		$	174.9
Cost of products sold	51.7			29.2			66.6			—			147.5
Gross profit	15.4			5.2			6.8			—			27.4
Selling, general and administrative expenses	9.2			2.1			3.8			—			15.1
Other (income) expense - net	(0.2		)	0.1			(0.1		)	—			(0.2		)
Operating income	6.4			3.0			3.1			—			12.5
Equity in earnings of subsidiaries	(5.1		)	—			—			5.1			—
Interest expense-net	3.3			—			0.3			—			3.6
Income from continuing operations before income taxes	8.2			3.0			2.8			(5.1		)	8.9
Provision for income taxes	1.5			0.4			0.2			—			2.1
Income from continuing operations	6.7			2.6			2.6			(5.1		)	6.8
Loss from discontinued operations, net of income taxes	—			(0.1		)	—			—			(0.1		)
Net income	$	6.7		$	2.5		$	2.6		$	(5.1	)	$	6.7

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the Nine Months Ended September 30, 2012

	Neenah Paper, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated Amounts
Net sales	$	305.3		$	107.0		$	203.9	$	—		$	616.2
Cost of products sold	237.9			84.9			172.0		—			494.8
Gross profit	67.4			22.1			31.9		—			121.4
Selling, general and administrative expenses	36.0			8.0			13.1		—			57.1
SERP settlement charge	3.5			—			—		—			3.5
Acquisition integration costs	4.7			—			—		—			4.7
Loss on retirement of bonds	0.2			—			—		—			0.2
Other expense - net	0.1			0.9			0.4		—			1.4
Operating income	22.9			13.2			18.4		—			54.5
Equity in earnings of subsidiaries	(23.7		)	—			—		23.7			—
Interest expense-net	9.9			—			0.5		—			10.4
Income from continuing operations before income taxes	36.7			13.2			17.9		(23.7		)	44.1
Provision for income taxes	6.0			4.8			2.5		—			13.3
Income from continuing operations	30.7			8.4			15.4		(23.7		)	30.8
Loss from discontinued operations, net of income taxes	—			(0.1		)	—		—			(0.1		)
Net income	$	30.7		$	8.3		$	15.4	$	(23.7	)	$	30.7

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the Nine Months Ended September 30, 2011

	Neenah Paper, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Amounts
Net sales	$	202.0		$	110.8		$	217.7		$	—		$	530.5
Cost of products sold	153.8			90.0			192.6			—			436.4
Gross profit	48.2			20.8			25.1			—			94.1
Selling, general and administrative expenses	30.7			7.7			11.7			—			50.1
Loss on retirement of bonds	2.4			—			—			—			2.4
Other (income) expense - net	(0.5		)	0.3			(1.2		)	—			(1.4		)
Operating income	15.6			12.8			14.6			—			43.0
Equity in earnings of subsidiaries	(20.8		)	—			—			20.8			—
Interest expense-net	10.9			0.1			0.8			—			11.8
Income from continuing operations before income taxes	25.5			12.7			13.8			(20.8		)	31.2
Provision for income taxes	4.1			4.2			1.3			—			9.6
Income from continuing operations	21.4			8.5			12.5			(20.8		)	21.6
Loss from discontinued operations, net of income taxes	—			(0.2		)	—			—			(0.2		)
Net income	$	21.4		$	8.3		$	12.5		$	(20.8	)	$	21.4

SCHEDULE OF CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the Three Months Ended September 30, 2012

	Neenah Paper, Inc.		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated Amounts
Net income	$	9.1	$	2.2		$	2.9	$	(5.1	)	$	9.1
Unrealized foreign currency translation gain (loss)	—		(0.2		)	6.4		—			6.2
Reclassification of amortization of adjustments to pension and other postretirement benefit liabilities recognized in net periodic benefit cost	0.4		0.8			—		—			1.2
Income from other comprehensive income items	0.4		0.6			6.4		—			7.4
Provision for income taxes	0.1		0.3			—		—			0.4
Other comprehensive income	0.3		0.3			6.4		—			7.0
Comprehensive income	$	9.4	$	2.5		$	9.3	$	(5.1	)	$	16.1

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the Three Months Ended September 30, 2011

	Neenah Paper, Inc.			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Amounts
Net income	$	6.7		$	2.5	$	2.6		$	(5.1	)	$	6.7
Unrealized foreign currency translation gain (loss)	—			0.3		(11.3		)	—			(11.0		)
Reclassification of amortization of adjustments to pension and other postretirement benefit liabilities recognized in net periodic benefit cost	0.4			0.2		—			—			0.6
Unrealized loss on “available-for-sale” securities	(0.1		)	—		—			—			(0.1		)
Income (loss) from other comprehensive income items	0.3			0.5		(11.3		)	—			(10.5		)
Provision for income taxes	0.1			0.1		—			—			0.2
Other comprehensive income (loss)	0.2			0.4		(11.3		)	—			(10.7		)
Comprehensive income (loss)	$	6.9		$	2.9	$	(8.7	)	$	(5.1	)	$	(4.0	)

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the Nine Months Ended September 30, 2012

	Neenah Paper, Inc.		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Amounts
Net income	$	30.7	$	8.3		$	15.4		$	(23.7	)	$	30.7
Unrealized foreign currency translation loss	—		(0.2		)	(0.6		)	—			(0.8		)
Net gain (loss) from adjustments to pension and other postretirement benefit liabilities	5.3		(4.2		)	—			—			1.1
Reclassification of amortization of adjustments to pension and other postretirement benefit liabilities recognized in net periodic benefit cost	1.4		2.3			—			—			3.7
SERP settlement charge	3.5		—			—			—			3.5
Curtailment loss	0.2		0.1			—			—			0.3
Unrealized gain on “available-for-sale” securities	0.1		—			—			—			0.1
Income (loss) from other comprehensive income items	10.5		(2.0		)	(0.6		)	—			7.9
Provision (benefit) for income taxes	4.0		(0.7		)	—			—			3.3
Other comprehensive income (loss)	6.5		(1.3		)	(0.6		)	—			4.6
Comprehensive income	$	37.2	$	7.0		$	14.8		$	(23.7	)	$	35.3

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the Nine Months Ended September 30, 2011

	Neenah Paper, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated Amounts
Net income	$	21.4	$	8.3	$	12.5	$	(20.8	)	$	21.4
Unrealized foreign currency translation gain	—		0.2		4.5		—			4.7
Net gain from pension and other postretirement benefit liabilities	0.1		—		—		—			0.1
Reclassification of amortization of adjustments to pension and other postretirement benefit liabilities recognized in net periodic benefit cost	1.1		0.7		—		—			1.8
Income from other comprehensive income items	1.2		0.9		4.5		—			6.6
Provision for income taxes	0.4		0.3		—		—			0.7
Other comprehensive income	0.8		0.6		4.5		—			5.9
Comprehensive income	$	22.2	$	8.9	$	17.0	$	(20.8	)	$	27.3

SCHEDULE OF CONDENSED CONSOLIDATING BALANCE SHEET

CONDENSED CONSOLIDATING BALANCE SHEET

As of September 30, 2012

	Neenah Paper, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated Amounts
ASSETS
Current assets
Cash and cash equivalents	$	—	$	1.7	$	4.9	$	—		$	6.6
Accounts receivable, net	45.7		18.9		35.2		—			99.8
Inventories	57.1		12.4		29.8		—			99.3
Income taxes receivable	—		—		2.5		—			2.5
Deferred income taxes	26.4		2.5		0.4		—			29.3
Intercompany amounts receivable	18.9		44.3		—		(63.2		)	—
Prepaid and other current assets	5.0		2.0		4.9		—			11.9
Total current assets	153.1		81.8		77.7		(63.2		)	249.4
Property, plant and equipment, at cost	275.9		103.1		212.0		—			591.0
Less accumulated depreciation	204.7		69.1		69.8		—			343.6
Property, plant and equipment — net	71.2		34.0		142.2		—			247.4
Investments In Subsidiaries	246.5		—		—		(246.5		)	—
Deferred Income Taxes	20.8		4.7		—		—			25.5
Goodwill	—		—		40.3		—			40.3
Intangible Assets—net	16.2		—		17.9		—			34.1
Other Assets	5.2		0.1		5.4		—			10.7
TOTAL ASSETS	$	513.0	$	120.6	$	283.5	$	(309.7	)	$	607.4
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Debt payable within one year	$	—	$	—	$	1.6	$	—		$	1.6
Accounts payable	25.7		5.3		11.4		—			42.4
Intercompany amounts payable	44.2		18.8		0.2		(63.2		)	—
Accrued expenses	31.5		8.4		16.1		—			56.0
Total current liabilities	101.4		32.5		29.3		(63.2		)	100.0
Long-term Debt	175.8		—		5.7		—			181.5
Deferred Income Taxes	—		—		14.7		—			14.7
Noncurrent Employee Benefits and Other	31.9		38.3		37.1		—			107.3
TOTAL LIABILITIES	309.1		70.8		86.8		(63.2		)	403.5
STOCKHOLDERS’ EQUITY	203.9		49.8		196.7		(246.5		)	203.9
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	513.0	$	120.6	$	283.5	$	(309.7	)	$	607.4

CONDENSED CONSOLIDATING BALANCE SHEET

As of December 31, 2011

	Neenah Paper, Inc		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated Amounts
ASSETS
Current assets
Cash and cash equivalents	$	9.7	$	2.0	$	1.1	$	—		$	12.8
Restricted cash	7.0		—		—		—			7.0
Accounts receivable, net	22.9		18.1		30.4		—			71.4
Inventories	33.4		9.4		26.0		—			68.8
Income taxes receivable	—		—		1.9		—			1.9
Deferred income taxes	15.4		2.2		—		—			17.6
Intercompany amounts receivable	18.1		42.4		—		(60.5		)	—
Prepaids and othe current assets	5.6		2.0		6.4		—			14.0
Total current assets	112.1		76.1		65.8		(60.5		)	193.5
Property, plant and equipment at cost	269.2		100.4		209.6		—			579.2
Less accumulated depreciation	198.5		66.8		61.6		—			326.9
Property, plant and equipment — net	70.7		33.6		148.0		—			252.3
Investments in Subsidiaries	225.0		—		—		(225.0		)	—
Deferred Income Taxes	38.7		6.8		—		—			45.5
Goodwill	—		—		40.5		—			40.5
Intangible Assets—net	2.8		—		19.1		—			21.9
Other Assets	5.8		0.1		5.5		—			11.4
TOTAL ASSETS	$	455.1	$	116.6	$	278.9	$	(285.5	)	$	565.1
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Debt payable within one year	$	—	$	—	$	21.7	$	—		$	21.7
Accounts payable	16.0		6.6		7.6		—			30.2
Intercompany amounts payable	42.4		18.1		—		(60.5		)	—
Accrued expenses	32.4		7.5		11.7		—			51.6
Total current liabilities	90.8		32.2		41.0		(60.5		)	103.5
Long-term Debt	158.0		—		6.5		—			164.5
Deferred Income Taxes	—		—		16.0		—			16.0
Noncurrent Employee Benefits and Other Obligations	39.6		37.7		37.1		—			114.4
TOTAL LIABILITIES	288.4		69.9		100.6		(60.5		)	398.4
STOCKHOLDERS’ EQUITY	166.7		46.7		178.3		(225.0		)	166.7
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	455.1	$	116.6	$	278.9	$	(285.5	)	$	565.1

SCHEDULE OF CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the Nine Months Ended September 30, 2012

	Neenah Paper, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Amounts
OPERATING ACTIVITIES
Net income	$	30.7		$	8.3		$	15.4		$	(23.7	)	$	30.7
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	8.9			3.1			9.8			—			21.8
Stock-based compensation	2.0			—			1.9			—			3.9
Excess tax benefit from stock-based compensation	(5.1		)	—			—			—			(5.1		)
Deferred income tax provision (benefit)	3.0			7.5			(1.6		)	—			8.9
Inventory acquired in Wausau acquisition	(6.6		)	—			—			—			(6.6		)
SERP payment, net of settlement charge	(3.4		)	—			—			—			(3.4		)
Loss on retirement of bonds	0.2			—			—			—			0.2
Loss on asset dispositions	0.2			—			—			—			0.2
Increase in working capital	(22.7		)	(3.9		)	(0.2		)	—			(26.8		)
Equity in earnings of subsidiaries	(23.7		)	—			—			23.7			—
Pension and other postretirement benefits	(2.8		)	1.0			0.5			—			(1.3		)
Other	—			(0.6		)	—			—			(0.6		)
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	(19.3		)	15.4			25.8			—			21.9
INVESTING ACTIVITIES
Capital expenditures	(8.4		)	(3.8		)	(3.6		)	—			(15.8		)
Decrease in restricted cash	7.0			—			—			—			7.0
Purchase of marketable securities	(0.1		)	—			—			—			(0.1		)
Purchase of Wausau brands	(14.1		)	—			—			—			(14.1		)
Other	(0.2		)	0.1			0.3			—			0.2
NET CASH USED IN INVESTING ACTIVITIES	(15.8		)	(3.7		)	(3.3		)	—			(22.8		)
FINANCING ACTIVITIES
Proceeds from issuance of long-term debt	45.2			—			—			—			45.2
Repayments of long-term debt	(27.5		)	—			(0.8		)	—			(28.3		)
Short-term borrowings	—			—			1.2			—			1.2
Repayments of short-term debt	—			—			(21.1		)	—			(21.1		)
Shares purchased	(6.3		)	—			—			—			(6.3		)
Proceeds from exercise of stock options	4.9			—			—			—			4.9
Excess tax benefit from stock-based compensation	5.1			—			—			—			5.1
Cash dividends paid	(5.8		)	—			—			—			(5.8		)
Other	(0.2		)	—			—			—			(0.2		)
Intercompany transfers - net	10.0			(12.0		)	2.0			—			—
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES	25.4			(12.0		)	(18.7		)	—			(5.3		)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	(9.7		)	(0.3		)	3.8			—			(6.2		)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR	9.7			2.0			1.1			—			12.8
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	—		$	1.7		$	4.9		$	—		$	6.6

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the Nine Months Ended September 30, 2011

	Neenah Paper, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Amounts
OPERATING ACTIVITIES
Net income	$	21.4		$	8.3		$	12.5		$	(20.8	)	$	21.4
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	9.0			3.2			11.3			—			23.5
Stock-based compensation	2.9			—			0.2			—			3.1
Excess tax benefit from stock-based compensation	(0.8		)	—			—			—			(0.8		)
Deferred income tax provision (benefit)	4.1			3.5			(1.7		)	—			5.9
Loss on retirement of bonds	2.4			—			—			—			2.4
Increase in working capital	(4.0		)	(1.1		)	(5.1		)	—			(10.2		)
Equity in earnings of subsidiaries	(20.8		)	—			—			20.8			—
Pension and other postretirement benefits	(0.7		)	(4.5		)	0.4			—			(4.8		)
Other	(0.1		)	(0.8		)	(0.1		)	—			(1.0		)
NET CASH PROVIDED BY OPERATING ACTIVITIES	13.4			8.6			17.5			—			39.5
INVESTING ACTIVITIES
Capital expenditures	(4.2		)	(1.8		)	(12.9		)	—			(18.9		)
Purchase of marketable securities	(5.3		)	—			—			—			(5.3		)
Other	0.2			(0.1		)	0.3			—			0.4
NET CASH USED IN INVESTING ACTIVITIES	(9.3		)	(1.9		)	(12.6		)	—			(23.8		)
FINANCING ACTIVITIES
Proceeds from issuance of long-term debt	27.8			—			—			—			27.8
Debt issuance costs	(0.4		)	—			—			—			(0.4		)
Repayments of long-term debt	(88.4		)	—			(0.9		)	—			(89.3		)
Short-term borrowings	—			—			8.5			—			8.5
Repayments of short-term debt	—			—			(3.7		)	—			(3.7		)
Shares purchased	(0.5		)	—			—			—			(0.5		)
Proceeds from exercise of stock options	1.5			—			—			—			1.5
Excess tax benefit from stock-based compensation	0.8			—			—			—			0.8
Cash dividends paid	(5.0		)	—			—			—			(5.0		)
Intercompany transfers - net	15.2			(7.0		)	(8.2		)	—			—
NET CASH USED IN FINANCING ACTIVITIES	(49.0		)	(7.0		)	(4.3		)	—			(60.3		)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	—			—			0.1			—			0.1
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	(44.9		)	(0.3		)	0.7			—			(44.5		)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR	45.0			2.4			0.9			—			48.3
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	0.1		$	2.1		$	1.6		$	—		$	3.8