POST-2013.12.31-10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly Period Ended December 31, 2013
OR
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Transition Period from _____ to _____
Commission File Number: 1-35305
Post Holdings, Inc.
(Exact name of registrant as specified in its charter)
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| | |
Missouri | | 45-3355106 |
(State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification No.) |
2503 S. Hanley Road
St. Louis, Missouri 63144
(Address of principal executive offices) (Zip Code)
(314) 644-7600
(Registrant’s telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. |
| |
Large accelerated filer x | Accelerated filer o |
Non-accelerated filer o (Do not check if a smaller reporting company) | Smaller reporting company o |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:
Common stock, $0.01 Par Value – 32,693,019 shares as of February 5, 2014
POST HOLDINGS, INC.
QUARTERLY REPORT ON FORM 10-Q
TABLE OF CONTENTS
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PART I. | FINANCIAL INFORMATION | Page |
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Item 1. | | |
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Item 2. | | |
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Item 3. | | |
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Item 4. | | |
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PART II. | | |
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Item 1. | | |
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Item 1A. | | |
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Item 6. | | |
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PART I. FINANCIAL INFORMATION.
ITEM 1. FINANCIAL STATEMENTS.
POST HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(in millions, except per share data)
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| | | | | | | |
| Three Months Ended December 31, |
| 2013 | | 2012 |
Net Sales | $ | 297.0 |
| | $ | 236.9 |
|
Cost of goods sold | 182.5 |
| | 131.2 |
|
Gross Profit | 114.5 |
| | 105.7 |
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| | | |
Selling, general and administrative expenses | 83.0 |
| | 72.1 |
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Amortization of intangible assets | 5.7 |
| | 3.2 |
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Restructuring expenses | 0.5 |
| | — |
|
Other operating expenses, net | 0.1 |
| | 0.1 |
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Operating Profit | 25.2 |
| | 30.3 |
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| | | |
Interest expense | 29.0 |
| | 19.2 |
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(Loss) Earnings before Income Taxes | (3.8 | ) | | 11.1 |
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Income tax (benefit) provision | (1.4 | ) | | 3.5 |
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Net (Loss) Earnings | (2.4 | ) | | 7.6 |
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Preferred stock dividends | (2.6 | ) | | — |
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Net (Loss) Earnings Available to Common Stockholders | $ | (5.0 | ) | | $ | 7.6 |
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| | | |
(Loss) Earnings per Common Share: | | | |
Basic | $ | (0.15 | ) | | $ | 0.23 |
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Diluted | $ | (0.15 | ) | | $ | 0.23 |
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| | | |
Weighted-Average Common Shares Outstanding: | | | |
Basic | 32.7 |
| | 32.6 |
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Diluted | 32.7 |
| | 32.7 |
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See accompanying Notes to Condensed Consolidated Financial Statements.
POST HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
(in millions)
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| | | | | | | |
| Three Months Ended December 31, |
| 2013 | | 2012 |
Net (Loss) Earnings | $ | (2.4 | ) | | $ | 7.6 |
|
Amortization of actuarial (benefit) loss and prior service cost for pension and postretirement benefits, net of tax benefit (expense) of $0.1 and $(0.2), respectively | (0.1 | ) | | 0.3 |
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Foreign currency translation adjustments | (2.2 | ) | | (0.8 | ) |
Total Comprehensive (Loss) Income | $ | (4.7 | ) | | $ | 7.1 |
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See accompanying Notes to Condensed Consolidated Financial Statements.
POST HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(in millions)
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| | | | | | | |
| December 31, 2013 | | September 30, 2013 |
ASSETS |
Current Assets | | | |
Cash and cash equivalents | $ | 884.9 |
| | $ | 402.0 |
|
Restricted cash | 1.1 |
| | 38.1 |
|
Receivables, net | 84.9 |
| | 83.2 |
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Inventories | 120.8 |
| | 121.9 |
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Deferred income taxes | 12.1 |
| | 11.9 |
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Prepaid expenses and other current assets | 10.8 |
| | 11.0 |
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Total Current Assets | 1,114.6 |
| | 668.1 |
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Property, net | 387.7 |
| | 388.5 |
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Goodwill | 1,489.6 |
| | 1,489.7 |
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Other intangible assets, net | 892.7 |
| | 898.4 |
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Cash advance for acquisition | 366.2 |
| | — |
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Deferred income taxes | 2.2 |
| | 2.4 |
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Other assets | 36.1 |
| | 26.7 |
|
Total Assets | $ | 4,289.1 |
| | $ | 3,473.8 |
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| | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY |
Current Liabilities | | | |
Accounts payable | $ | 56.8 |
| | $ | 77.1 |
|
Other current liabilities | 94.3 |
| | 68.9 |
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Total Current Liabilities | 151.1 |
| | 146.0 |
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Long-term debt | 1,932.9 |
| | 1,408.6 |
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Deferred income taxes | 302.4 |
| | 304.3 |
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Other liabilities | 117.0 |
| | 116.3 |
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Total Liabilities | 2,503.4 |
| | 1,975.2 |
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| | | |
Stockholders’ Equity | | | |
Preferred stock | 0.1 |
| | — |
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Common stock | 0.3 |
| | 0.3 |
|
Additional paid-in capital | 1,811.2 |
| | 1,517.2 |
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Retained earnings | 42.9 |
| | 47.6 |
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Accumulated other comprehensive loss | (15.4 | ) | | (13.1 | ) |
Treasury stock, at cost | (53.4 | ) | | (53.4 | ) |
Total Stockholders’ Equity | 1,785.7 |
| | 1,498.6 |
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Total Liabilities and Stockholders’ Equity | $ | 4,289.1 |
| | $ | 3,473.8 |
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See accompanying Notes to Condensed Consolidated Financial Statements.
POST HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(in millions)
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| | | | | | | |
| Three Months Ended December 31, |
| 2013 | | 2012 |
Cash Flows from Operating Activities | | | |
Net (Loss) Earnings | $ | (2.4 | ) | | $ | 7.6 |
|
Adjustments to reconcile net (loss) earnings to net cash flow provided by operating activities: | | | |
Depreciation and amortization | 21.1 |
| | 16.2 |
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Premium from issuance of long-term debt | — |
| | 15.0 |
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Stock-based compensation expense | 3.4 |
| | 2.5 |
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Deferred income taxes | (1.8 | ) | | (3.8 | ) |
Other, net | (1.9 | ) | | 0.2 |
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Other changes in current assets and liabilities, net of business acquisitions: | | | |
Increase in receivables, net | (2.0 | ) | | (9.8 | ) |
Increase in receivable from Ralcorp | — |
| | (0.9 | ) |
Decrease (increase) in inventories | 0.8 |
| | (19.0 | ) |
Decrease in prepaid expenses and other current assets | 1.4 |
| | 5.7 |
|
Increase in accounts payable and other current and non-current liabilities | 6.3 |
| | 9.9 |
|
Net Cash Provided by Operating Activities | 24.9 |
| | 23.6 |
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| | | |
Cash Flows from Investing Activities | | | |
Business acquisitions | — |
| | (9.2 | ) |
Cash advance for acquisition | (366.2 | ) | | — |
|
Additions to property | (16.5 | ) | | (5.0 | ) |
Restricted cash | 37.0 |
| | — |
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Net Cash Used by Investing Activities | (345.7 | ) | | (14.2 | ) |
| | | |
Cash Flows from Financing Activities | | | |
Proceeds from issuance of long term debt | 525.0 |
| | 250.0 |
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Proceeds from issuance of preferred stock, net of issuance costs | 290.8 |
| | — |
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Repayments of long-term debt | — |
| | (2.2 | ) |
Payment of preferred stock dividend | (2.3 | ) | | — |
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Payments of debt issuance costs | (8.8 | ) | | (4.6 | ) |
Other, net | (0.1 | ) | | 0.2 |
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Net Cash Provided by Financing Activities | 804.6 |
| | 243.4 |
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Effect of Exchange Rate Changes on Cash | (0.9 | ) | | (0.1 | ) |
| | | |
Net Increase in Cash and Cash Equivalents | 482.9 |
| | 252.7 |
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Cash and Cash Equivalents, Beginning of Year | 402.0 |
| | 58.2 |
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Cash and Cash Equivalents, End of Period | $ | 884.9 |
| | $ | 310.9 |
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See accompanying Notes to Condensed Consolidated Financial Statements.
POST HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in millions, except per share information and where indicated otherwise)
NOTE 1 — BACKGROUND
Post Holdings, Inc. (“Post” or the “Company”) is a consumer goods company operating in the center-of-the-store, active nutrition and private label food categories. Most of the Company’s products are manufactured through a flexible production platform consisting of five primary facilities, four of which are owned by Post, and sold through a variety of channels such as grocery stores, mass merchandisers, club stores and drug stores. Post operates in three reportable segments: Post Foods, Attune Foods and Active Nutrition. The Post Foods segment predominately includes the Post branded ready-to-eat cereal business. The Attune Foods segment manufactures and distributes premium natural organic cereals and snacks and is comprised of the businesses of Attune Foods, Inc., which we acquired substantially all of the assets of in December 2012, and certain assets of the Hearthside Food Solutions private label and branded businesses, which we acquired in May 2013. The Active Nutrition segment includes the business of Premier Nutrition Corporation (“PNC”), which we acquired in September 2013. The Active Nutrition segment manufactures and sells high protein shakes and bars as well as nutritional supplements. Post’s portfolio of brands includes diverse offerings such as Honey Bunches of Oats®, Pebbles™, Post Selects®, Great Grains®, Spoon Size® Shredded Wheat, Post® Raisin Bran, Grape-Nuts®, Honeycomb®, Attune®, Uncle Sam®, Erewhon®, Golden Temple™, Peace Cereal®, Sweet Home Farm®, Willamette Valley Granola Company™, Premier Protein® and Joint Juice®.
Post Foods’ products are manufactured at four facilities located in Battle Creek, Michigan; Jonesboro, Arkansas; Modesto, California; and Niagara Falls, Ontario. Attune Foods’ products are primarily manufactured at a facility located in Eugene, Oregon, and Premier Nutrition Corporation’s products are manufactured under third-party co-manufacturing agreements. Refer to Note 2 for details regarding the announced closure of the Modesto, California facility.
Unless otherwise stated or the context otherwise indicates, all references in this Form 10-Q to “Post,” “the Company,” “us,” “our” or “we” mean Post Holdings, Inc. and its consolidated subsidiaries.
Basis of Presentation
These unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”), under the rules and regulations of the United States Securities and Exchange Commission (the “SEC”), and on a basis substantially consistent with the audited consolidated financial statements of the Company as of and for the fiscal year ended September 30, 2013. These unaudited condensed consolidated financial statements should be read in conjunction with such audited consolidated financial statements, which are included in the Company’s Annual Report on Form 10-K filed with the SEC on November 27, 2013.
These unaudited condensed consolidated financial statements include all adjustments (consisting of normal recurring adjustments and accruals) that management considers necessary for a fair statement of its financial position, results of operations, comprehensive income and cash flows for the interim periods presented. Interim results are not necessarily indicative of the results for any other interim period or for the entire fiscal year.
The financial position and operating results of foreign operations are consolidated using the local currency as the functional currency. Local currency assets and liabilities are translated at the rates of exchange on the balance sheet date, and local currency revenues and expenses are translated at average rates of exchange during the period. Resulting translation gains or losses are included in the condensed consolidated balance sheet as a component of accumulated other comprehensive loss.
Use of Estimates
The preparation of the financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the condensed consolidated financial statements and footnotes thereto. Actual results could differ from those estimates. Significant estimates inherent in the preparation of the condensed consolidated financial statements include accounting for reserves established for doubtful accounts, stock-based compensation, impairment analyses, depreciation and amortization, income taxes, litigation matters and contingencies.
Recently Adopted Accounting Standards
In the first quarter of fiscal 2014, Post adopted Accounting Standards Update 2013-02, “Reporting Amounts Reclassified out of Accumulated Other Comprehensive Income.” The only reclassification out of accumulated other comprehensive income for the reported periods is amortization of actuarial (benefit) loss and prior service cost for pension and postretirement benefits totaling $(0.2) and $0.5 for the periods ended December 31, 2013 and 2012, respectively. Amounts are classified as “Selling, general and administrative expenses” on the statements of operations.
NOTE 2 — RESTRUCTURING
In April 2013, the Company announced management’s decision to close its plant located in Modesto, California as part of a cost savings and capacity rationalization effort. The transfer of production capabilities and closure of the plant is expected to be completed by September 2014.
Amounts related to the plant closure are shown in the following table. Costs are recognized in “Restructuring expense” in the statements of operations with the exception of accelerated depreciation expense which is included in “Cost of Goods Sold.” These expenses are not included in the measure of segment performance for any segment.
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| | | | | | | | | | | |
| Three Months Ended December 31, 2013 | | Cumulative Incurred to Date | | Remaining Expense Expected to be Incurred |
Employee severance | $ | 0.5 |
| | $ | 2.6 |
| | $ | 0.9 |
|
Pension curtailment | — |
| | 1.7 |
| | — |
|
Accelerated depreciation | 2.7 |
| | 12.3 |
| | 5.8 |
|
| $ | 3.2 |
| | $ | 16.6 |
| | $ | 6.7 |
|
Liabilities recorded related to restructuring activities and changes therein are as follows:
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| | | | | | | | | | | | | | | |
| September 30, 2013 | | Costs Incurred and Charged to Expense | | Cash Paid | | December 31, 2013 |
Employee severance | $ | 2.1 |
| | $ | 0.5 |
| | $ | (0.8 | ) | | $ | 1.8 |
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NOTE 3 — BUSINESS COMBINATIONS
On December 31, 2012, Post Foods, LLC, a subsidiary of the Company, purchased substantially all of the assets of Attune Foods, Inc. (“Attune”) for approximately $9.2 of cash. On October 1, 2013, these assets were contributed to Post Holdings, Inc. in a non-cash tax-free transaction.
On May 28, 2013, the Company completed its acquisition of certain assets of the branded and private label cereal, granola and snacks business of Hearthside Food Solutions (“Hearthside”) for approximately $159.9 of cash. The Company combined this business with the Attune business to form the Attune Foods reporting segment (see Note 15).
On September 3, 2013, the Company completed its acquisition of Premier Nutrition Corporation (“PNC”), which was effective September 1, 2013, for approximately $186.0 of cash. PNC is reported in Post’s Active Nutrition segment (see Note 15). During the first quarter of fiscal 2014, a final settlement of net working capital, as defined in the PNC purchase agreement, was reached resulting in an increase in total consideration of approximately $0.1 and a corresponding increase in goodwill. As this adjustment did not have a significant impact on the consolidated statement of income, balance sheets or cash flows, the financial statements have not been retrospectively adjusted.
Each of the acquisitions was accounted for using the acquisition method of accounting, whereby their results of operations are included in the financial statements from the date of acquisition. The respective purchase prices were allocated to acquired assets and liabilities based on their estimated fair values at the date of acquisition, and any excess was allocated to goodwill. Certain estimated values for the Hearthside and PNC acquisitions, including goodwill, intangible assets and deferred taxes, are not yet finalized pending the final settlement of the purchase price and purchase price allocations and are subject to change once additional information is obtained.
The following unaudited pro forma information presents a summary of the combined results of operations of the Company and the aggregate results of Attune, Hearthside and PNC for the periods presented as if those fiscal 2013 acquisitions had occurred on October 1, 2011, along with certain pro forma adjustments. These pro forma adjustments give effect to the amortization of certain definite-lived intangible assets, adjusted depreciation based upon fair value of assets acquired, interest expense related to the financing of the business combinations, and related income taxes. The following unaudited pro forma information has been prepared for comparative purposes only and is not necessarily indicative of the results of operations as they would have been had the acquisition occurred on the assumed date, nor is it necessarily an indication of future operating results.
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| | | |
| Three Months Ended December 31, 2012 |
Pro forma net sales | $ | 284.2 |
|
Pro forma net earnings available to common stockholders | $ | 4.9 |
|
Pro forma basic earnings per share | $ | 0.15 |
|
Pro forma diluted earnings per share | $ | 0.15 |
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NOTE 4 — GOODWILL
The changes in the carrying amount of goodwill by segment are noted in the following table.
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| | | | | | | | | | | | | | | |
| Post Foods | | Attune Foods | | Active Nutrition | | Total |
Balance, September 30, 2013 | | | | | | | |
Goodwill (gross) | $ | 1,794.1 |
| | $ | 75.1 |
| | $ | 48.3 |
| | $ | 1,917.5 |
|
Accumulated impairment losses | (427.8 | ) | | — |
| | — |
| | (427.8 | ) |
Goodwill (net) | $ | 1,366.3 |
| | $ | 75.1 |
| | $ | 48.3 |
| | $ | 1,489.7 |
|
Purchase price true-up adjustment | — |
| | — |
| | 0.1 |
| | 0.1 |
|
Currency translation adjustment | (0.2 | ) | | — |
| | — |
| | (0.2 | ) |
Balance, December 31, 2013 | | | | | | | |
Goodwill (gross) | $ | 1,793.9 |
| | $ | 75.1 |
| | $ | 48.4 |
| | $ | 1,917.4 |
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Accumulated impairment losses | (427.8 | ) | | — |
| | — |
| | (427.8 | ) |
Goodwill (net) | $ | 1,366.1 |
| | $ | 75.1 |
| | $ | 48.4 |
| | $ | 1,489.6 |
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NOTE 5 — INTANGIBLE ASSETS, NET
Total intangible assets are as follows: |
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| | December 31, 2013 | | September 30, 2013 |
| | Carrying Amount | | Accumulated Amortization | | Net Amount | | Carrying Amount | | Accumulated Amortization | | Net Amount |
Subject to amortization: | | | | | | | | | | | | |
Customer relationships | | $ | 258.6 |
| | $ | (44.3 | ) | | $ | 214.3 |
| | $ | 258.6 |
| | $ | (41.0 | ) | | $ | 217.6 |
|
Trademarks/brands | | 161.5 |
| | (27.8 | ) | | 133.7 |
| | 161.5 |
| | (25.8 | ) | | 135.7 |
|
Other intangible assets | | 4.7 |
| | (0.7 | ) | | 4.0 |
| | 4.7 |
| | (0.3 | ) | | 4.4 |
|
| | $ | 424.8 |
| | $ | (72.8 | ) | | $ | 352.0 |
| | $ | 424.8 |
| | $ | (67.1 | ) | | $ | 357.7 |
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Not subject to amortization: | | | | | | | | | | | | |
Trademarks/brands | | 540.7 |
| | — |
| | 540.7 |
| | 540.7 |
| | — |
| | 540.7 |
|
| | $ | 965.5 |
| | $ | (72.8 | ) | | $ | 892.7 |
| | $ | 965.5 |
| | $ | (67.1 | ) | | $ | 898.4 |
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NOTE 6 — EARNINGS PER SHARE
Basic earnings per share is based on the average number of common shares outstanding during the period. Diluted earnings per share is based on the average number of shares used for the basic earnings per share calculation, adjusted for the dilutive effect of stock options, stock appreciation rights and restricted stock equivalents using the “treasury stock” method. The impact of potentially dilutive convertible preferred stock is calculated using the “if-converted” method.
The following table sets forth the computation of basic and diluted earnings per share for the three months ended December 31, 2013 and 2012, respectively.
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| | | | | | | |
| Three Months Ended December 31, |
| 2013 | | 2012 |
Net (loss) earnings | $ | (2.4 | ) | | $ | 7.6 |
|
Preferred stock dividends | (2.6 | ) | | — |
|
Net (loss) earnings available to common stockholders | $ | (5.0 | ) | | $ | 7.6 |
|
| | | |
Weighted-average shares for basic earnings per share | 32.7 |
| | 32.6 |
|
Effect of dilutive securities: | | | |
Stock appreciation rights | — |
| | 0.1 |
|
Total dilutive securities | — |
| | 0.1 |
|
Weighted-average shares for diluted earnings per share | 32.7 |
| | 32.7 |
|
| | | |
Basic (loss) earnings per common share | $ | (0.15 | ) | | $ | 0.23 |
|
Diluted (loss) earnings per common share | $ | (0.15 | ) | | $ | 0.23 |
|
For the three months ended December 31, 2013 and 2012, weighted-average shares for diluted (loss) earnings per common share excludes 3.8 million and 2.2 million equity awards, respectively, and for the quarter ended December 31, 2013 excludes 10.7 million shares related to the potential conversion of the Company’s convertible preferred stock (see Note 11) as they were anti-dilutive.
NOTE 7 — INVENTORIES |
| | | | | | | |
| December 31, 2013 | | September 30, 2013 |
Raw materials and supplies | $ | 33.1 |
| | $ | 30.3 |
|
Finished products | 87.7 |
| | 91.6 |
|
| $ | 120.8 |
| | $ | 121.9 |
|
NOTE 8 — PROPERTY, NET |
| | | | | | | |
| December 31, 2013 | | September 30, 2013 |
Property, at cost | $ | 653.7 |
| | $ | 640.5 |
|
Accumulated depreciation | (266.0 | ) | | (252.0 | ) |
| $ | 387.7 |
| | $ | 388.5 |
|
NOTE 9 — DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING
In the ordinary course of business, the Company is exposed to commodity price risks relating to the acquisition of raw materials and supplies, interest rate risks relating to debt, and foreign currency exchange rate risks relating to its foreign subsidiary. The Company utilizes derivative financial instruments, including (but not limited to) futures contracts, option contracts, forward contracts and swaps, to manage certain of these exposures by hedging when it is practical to do so. The Company does not hold or issue financial instruments for speculative or trading purposes.
The Company maintains options and futures contracts which have been designated as economic hedges of raw materials, fuel and energy purchases. The following tables present the balance sheet location and fair value of the Company’s derivative instruments on a gross and net basis as of December 31, 2013 and September 30, 2013.
|
| | | | | | | | | | | | | | |
| | | | Fair Value of Assets as of December 31, 2013 |
| | Balance Sheet Location | | Gross Amounts of Recognized Assets | | Gross Amounts Offset in the Condensed Consolidated Balance Sheet | | Net Amounts of Assets Presented in the Condensed Consolidated Balance Sheet |
Commodity contracts | Prepaid expenses and other current assets | $ | — |
| | $ | (0.2 | ) | | $ | (0.2 | ) |
Natural gas and heating oil futures | Prepaid expenses and other current assets | 0.6 |
| | — |
| | 0.6 |
|
| | | | $ | 0.6 |
| | $ | (0.2 | ) | | $ | 0.4 |
|
|
| | | | | | | | | | | | | | |
| | | | Fair Value of Liabilities as of December 31, 2013 |
| | Balance Sheet Location | | Gross Amounts of Recognized Liabilities | | Gross Amounts Offset in the Condensed Consolidated Balance Sheet | | Net Amounts of Liabilities Presented in the Condensed Consolidated Balance Sheet |
Foreign exchange contracts | | Other current liabilities | | $ | 1.3 |
| | $ | — |
| | $ | 1.3 |
|
|
| | | | | | | | | | | | | | |
| | | | Fair Value of Liabilities as of September 30, 2013 |
| | Balance Sheet Location | | Gross Amounts of Recognized Liabilities | | Gross Amounts Offset in the Condensed Consolidated Balance Sheet | | Net Amounts of Liabilities Presented in the Condensed Consolidated Balance Sheet |
Commodity contracts | Other current liabilities | | $ | 0.1 |
| | $ | — |
| | $ | 0.1 |
|
Natural gas and heating oil futures | Other current liabilities | | 0.1 |
| | — |
| | 0.1 |
|
| | | | $ | 0.2 |
| | $ | — |
| | $ | 0.2 |
|
The following table presents the loss from derivative instruments that were not designated as hedging instruments which were recorded on the Company’s Statements of Operations.
|
| | | | | | | | | | |
| | | | Amount of Gain (Loss) Recognized in Earnings |
| | | | Three Months Ended December 31, |
Derivative Instrument | | Location of Gain (Loss) Recognized in Earnings | | 2013 | | 2012 |
Commodity contracts | | Cost of goods sold | | $ | 0.2 |
| | $ | (0.5 | ) |
Natural gas and heating oil futures | | Cost of goods sold | | 0.7 |
| | (0.2 | ) |
Foreign exchange contracts | | Selling, general and administrative expenses | | (0.7 | ) | | — |
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NOTE 10 — FAIR VALUE MEASUREMENTS
The following table represents Post’s assets and liabilities measured at fair value on a recurring basis and the basis for that measurement according to the levels in the fair value hierarchy in ASC Topic 820:
|
| | | | | | | | | | | | | | | | | | | | | | | |
| December 31, 2013 | | September 30, 2013 |
| Total | | Level 1 | | Level 2 | | Total | | Level 1 | | Level 2 |
Assets: | | | | | | | | | | | |
Deferred compensation investment | $ | 10.0 |
| | $ | 10.0 |
| | $ | — |
| | $ | 8.5 |
| | $ | 8.5 |
| | $ | — |
|
Derivative assets | 0.4 |
| | — |
| | 0.4 |
| | — |
| | — |
| | — |
|
| $ | 10.4 |
| | $ | 10.0 |
| | $ | 0.4 |
| | $ | 8.5 |
| | $ | 8.5 |
| | $ | — |
|
Liabilities: | | | | | | | | | | | |
Deferred compensation liabilities | $ | 16.3 |
| | $ | — |
| | $ | 16.3 |
| | $ | 13.4 |
| | $ | — |
| | $ | 13.4 |
|
Derivative liabilities | 1.3 |
| | — |
| | 1.3 |
| | 0.2 |
| | — |
| | 0.2 |
|
| $ | 17.6 |
| | $ | — |
| | $ | 17.6 |
| | $ | 13.6 |
| | $ | — |
| | $ | 13.6 |
|
The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources, while unobservable inputs reflect a reporting entity’s pricing based upon their own market assumptions. The fair value hierarchy consists of three levels:
Level 1 — Inputs are quoted prices in active markets for identical assets or liabilities.
Level 2 — Inputs are quoted prices of similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable and market-corroborated inputs which are derived principally from or corroborated by observable market data.
Level 3 — Inputs are derived from valuation techniques in which one or more significant inputs or value drivers are unobservable.
The deferred compensation investment is invested primarily in mutual funds and its fair value is measured using the market approach. This investment is in the same funds and purchased in substantially the same amounts as the participants’ selected investment options (excluding Post common stock equivalents), which represent the underlying liabilities to participants in the Company’s deferred compensation plans. Deferred compensation liabilities are recorded at amounts due to participants in cash, based on the fair value of participants’ selected investment options (excluding certain Post common stock equivalents to be distributed in shares) using the market approach. The Company utilizes the income approach to measure fair value for its derivative assets, which include commodity options and futures contracts. The income approach uses pricing models that rely on market observable inputs such as yield curves and forward prices.
Changes in the fair value of assets and liabilities measured at fair value on a recurring basis are recorded as a component of selling, general and administrative expense, except for derivative instruments which are recorded in cost of goods sold.
The carrying amounts reported on the consolidated balance sheets for cash and cash equivalents, receivables and accounts payable approximate fair value because of the short maturities of these financial instruments. The fair value of long-term debt as of December 31, 2013 (see Note 12) is approximately $2,012.7 based on quoted market prices for the Company’s senior notes.
NOTE 11 — PREFERRED STOCK
In February 2013, the Company authorized and issued approximately 2.4 million shares of its 3.75% Series B Cumulative Perpetual Convertible Preferred Stock. The Company received net proceeds of $234.0 after paying offering related fees and expenses of approximately $7.5. The preferred stock has a $0.01 par value per share and a $100.00 liquidation value per share. The preferred stock earns cumulative dividends at a rate of 3.75% per annum payable quarterly on February 15, May 15, August 15 and November 15, beginning on May 15, 2013. The preferred stock is non-voting and ranks senior to our outstanding common stock upon the Company’s dissolution or liquidation. The preferred stock has no maturity date; however, holders of the preferred stock may convert their preferred stock at an initial conversion rate of 2.1192 shares of the Company’s common stock per share of convertible preferred stock, which is equivalent to a conversion price of $47.19 per share of common stock. Additionally, on or after February 15, 2018, the Company will have the option to redeem some or all the preferred stock at a redemption price equal to 100% of the liquidation preference per share, plus accrued and unpaid dividends if the closing sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period.
In December 2013, the Company authorized and issued approximately 3.0 million shares of its 2.5% Series C Cumulative Perpetual Convertible Preferred Stock. The Company also granted the initial purchasers of the preferred stock a 30-day option to purchase up to an additional 450,000 shares of preferred stock (see Note 17). The Company received net proceeds of $290.8 after paying offering related fees and expenses of approximately $9.2. The preferred stock has a $0.01 par value per share and a $100.00 liquidation value per share. The preferred stock earns cumulative dividends at a rate of 2.5% per annum payable quarterly on
February 15, May 15, August 15 and November 15, beginning on February 15, 2014. The preferred stock is non-voting and ranks senior to our outstanding common stock upon the Company’s dissolution or liquidation. The preferred stock has no maturity date; however, holders of the preferred stock may convert their preferred stock at an initial conversion rate of 1.8477 shares of the Company’s common stock per share of convertible preferred stock, which is equivalent to a conversion price of $54.12 per share of common stock. Additionally, on or after February 15, 2019, the Company will have the option to redeem some or all the preferred stock at a redemption price equal to 100% of the liquidation preference per share, plus accrued and unpaid dividends if the closing sale price of the Company’s common stock has been at least 150% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period.
NOTE 12 — LONG TERM DEBT
Long-term debt as of the dates indicated consists of the following:
|
| | | | | | | |
| December 31, 2013 | | September 30, 2013 |
7.375% Senior Notes maturing February 2022 | $ | 1,375.0 |
| | $ | 1,375.0 |
|
6.75% Senior Notes maturing December 2021 | 525.0 |
| | — |
|
| $ | 1,900.0 |
| | $ | 1,375.0 |
|
Plus: Unamortized premium | 32.9 |
| | 33.6 |
|
Total long-term debt | $ | 1,932.9 |
| | $ | 1,408.6 |
|
On November 18, 2013, the Company issued $525.0 principal value of 6.75% senior notes due in December 2021. The 6.75% senior notes were issued at par and the Company received $516.2 after paying investment banking and other fees of $8.8 which will be deferred and amortized to interest expense over the term of the notes.
The 7.375% senior notes and the 6.75% senior notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by each of our existing and future domestic subsidiaries (other than immaterial subsidiaries or receivables finance subsidiaries). Our foreign subsidiaries do not guarantee the senior notes. These guarantees are subject to release in limited circumstances (only upon the occurrence of certain customary conditions).
NOTE 13 — PENSION AND OTHER POSTRETIREMENT BENEFITS
Certain of the Company’s employees are eligible to participate in the Company’s qualified and supplemental noncontributory defined benefit pension plans and other postretirement benefit plans (partially subsidized retiree health and life insurance) or separate plans for Post Foods Canada Inc. Amounts for the Canadian plans are included in these disclosures and are not disclosed separately because they do not constitute a significant portion of the combined amounts.
The following tables provide the components of net periodic benefit cost for the plans.
|
| | | | | | | |
| Pension Benefits |
| Three Months Ended December 31, |
| 2013 | | 2012 |
Components of net periodic benefit cost | | | |
Service cost | $ | 0.9 |
| | $ | 1.1 |
|
Interest cost | 0.5 |
| | 0.4 |
|
Expected return on plan assets | (0.5 | ) | | (0.4 | ) |
Recognized net actuarial loss | 0.2 |
| | 0.2 |
|
Recognized prior service cost | 0.1 |
| | 0.1 |
|
Net periodic benefit cost | $ | 1.2 |
| | $ | 1.4 |
|
|
| | | | | | | |
| Other Benefits |
| Three Months Ended December 31, |
| 2013 | | 2012 |
Components of net periodic benefit cost | | | |
Service cost | $ | 0.5 |
| | $ | 0.6 |
|
Interest cost | 1.1 |
| | 1.0 |
|
Recognized net actuarial loss | 0.1 |
| | 0.4 |
|
Recognized prior service credit | (0.6 | ) | | (0.3 | ) |
Net periodic benefit cost | $ | 1.1 |
| | $ | 1.7 |
|
NOTE 14 — TRANSACTIONS WITH FORMER OWNER
Prior to Post’s legal separation from Ralcorp Holdings, Inc. (“Ralcorp”) on February 3, 2012 (the “Spin-Off”), Post operated under Ralcorp’s centralized cash management system, Post’s cash requirements were provided directly by Ralcorp, and cash generated by Post was generally remitted directly to Ralcorp. Transaction systems (e.g. payroll, employee benefits and accounts payable) used to record and account for cash disbursements were generally provided by Ralcorp. Ralcorp also provided centralized demand planning, order management, billing, credit and collection services to Post. Transaction systems (e.g. revenues, accounts receivable and cash application) used to record and account for cash receipts were generally provided by centralized Ralcorp organizations. These Ralcorp systems were generally designed to track assets/liabilities and receipts/payments on a business specific basis. After the Spin-Off, Ralcorp continues to provide certain of these services to Post under a transition services agreement (“TSA”) between the companies. TSA charges were $0.4 and $1.6, for the three months ended December 31, 2013 and 2012, respectively, and were reported in “Selling, general and administrative expenses.”
Post produces certain products for sale to Ralcorp. For periods subsequent to the Spin-Off, these transactions were based upon pricing governed by the TSA. Net sales related to those transactions were $3.7 and $4.0 in the three months ended December 31, 2013 and 2012, respectively.
In connection with the Spin-Off, the Company entered into a series of agreements with Ralcorp which are intended to govern the relationship between the Company and Ralcorp and to facilitate an orderly separation of the Company from Ralcorp. These agreements include a Separation and Distribution Agreement, Tax Allocation Agreement and the TSA, among others. Additionally, the Company has agreed to indemnify Ralcorp for income taxes incurred if the Company violates certain provisions of the IRS private letter ruling obtained by Ralcorp. Under certain of these agreements, the Company will incur expenses payable to Ralcorp in connection with certain administrative services provided for varying lengths of time. The Company incurred separation related costs of $0.2 and $2.8 during the three months ended December 31, 2013 and 2012, respectively. These separation related costs incurred were primarily related to third party professional service fees to effect the Spin-Off and professional service fees and duplicative costs incurred by Post to establish stand-alone processes and systems for activities performed by Ralcorp under the TSA. These costs were reported as a component of “Selling, general and administrative expenses.”
NOTE 15 — SEGMENTS
Management evaluates each segment’s performance based on its segment profit, which is its operating profit before impairment of intangible assets, accelerated depreciation on plant closures, restructuring expenses, and other unallocated corporate income and expenses. For the three months ended December 31, 2013, the Company has changed its methodology for allocating certain Corporate costs to segment profit. Accordingly, segment profit for the three months ended December 31, 2012 has been adjusted to align with current year presentation. The following tables present information about the Company’s operating segments, which are also its reportable segments, including corresponding amounts for the prior year.
|
| | | | | | | | | |
| | | Three Months Ended December 31, |
| | | 2013 | | 2012 |
Net Sales | | | |
| Post Foods | $ | 236.9 |
| | $ | 236.9 |
|
| Attune Foods | 23.2 |
| | — |
|
| Active Nutrition | 37.2 |
| | — |
|
| Eliminations | (0.3 | ) | | — |
|
| Total | $ | 297.0 |
| | $ | 236.9 |
|
Segment Profit | |
| Post Foods | $ | 46.5 |
| | $ | 47.0 |
|
| Attune Foods | 2.6 |
| | — |
|
| Active Nutrition | 4.2 |
| | — |
|
| Total segment profit | 53.3 |
| | 47.0 |
|
General corporate expenses and other | 24.9 |
| | 16.7 |
|
Accelerated depreciation on plant closure | 2.7 |
| | — |
|
Restructuring expenses | 0.5 |
| | — |
|
Interest expense | 29.0 |
| | 19.2 |
|
(Loss) earnings before income taxes | $ | (3.8 | ) | | $ | 11.1 |
|
Depreciation and amortization | | | |
| Post Foods | $ | 13.2 |
| | $ | 15.0 |
|
| Attune Foods | 1.8 |
| | — |
|
| Active Nutrition | 1.6 |
| | — |
|
| | Total segment depreciation and amortization | 16.6 |
| | 15.0 |
|
| Accelerated depreciation on plant closure | 2.7 |
| | — |
|
| Corporate | 1.8 |
| | 1.2 |
|
| Total | $ | 21.1 |
| | $ | 16.2 |
|
| | | |
| December 31, 2013 | | September 30, 2013 |
Assets | | | |
| Post Foods | $ | 2,598.5 |
| | $ | 2,614.9 |
|
| Attune Foods | 170.3 |
| | 172.0 |
|
| Active Nutrition | 199.2 |
| | 198.0 |
|
| Corporate | 1,321.1 |
| | 488.9 |
|
| Total | $ | 4,289.1 |
| | $ | 3,473.8 |
|
NOTE 16 — CONDENSED FINANCIAL STATEMENTS OF GUARANTORS
On February 3, 2012, the Company issued the 7.375% senior notes due February 2022 in an aggregate principal amount of $775.0 to Ralcorp pursuant to a contribution agreement in connection with the internal reorganization. The aggregate principal amount of the 7.375% senior notes was increased to a total of $1,375.0 by subsequent issuances completed on October 25, 2012 and July 18, 2013. The 7.375% senior notes were issued pursuant to an indenture dated as of February 3, 2012 among the Company, Post Foods, LLC, as guarantor, and Wells Fargo Bank, National Association, as trustee. Pursuant to a first supplemental indenture dated as of May 28, 2013, Attune Foods, LLC became a guarantor under the indenture. Pursuant to a second supplemental indenture dated as of September 3, 2013, PNC and its subsidiary became guarantors under the indenture.
On November 18, 2013, the Company issued 6.75% senior notes due December 2021 in an aggregate principal amount of $525.0 to certain qualified institutional buyers. The 6.75% senior notes were issued pursuant to an indenture dated as of November 18, 2013, among the Company, Post Foods, LLC, Attune Foods, LLC and PNC and its subsidiary, as guarantors and Wells Fargo Bank National Association, as trustee.
The 7.375% senior notes and the 6.75% senior notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by each of our existing and future domestic subsidiaries, the “Guarantors.” Our foreign subsidiaries, the “Non-Guarantors,” do not guarantee the senior notes. These guarantees are subject to release in limited circumstances (only upon the occurrence of certain customary conditions).
POST HOLDINGS, INC.
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (Unaudited)
|
| | | | | | | | | | | | | | | | | | | |
| Three Months Ended December 31, 2013 |
| Parent | | | | Non- | | | | |
| Company | | Guarantors | | Guarantors | | Eliminations | | Total |
Net Sales | $ | — |
| | $ | 284.8 |
| | $ | 18.8 |
| | $ | (6.6 | ) | | $ | 297.0 |
|
Cost of goods sold | — |
| | 174.1 |
| | 15.0 |
| | (6.6 | ) | | 182.5 |
|
Gross Profit | — |
| | 110.7 |
| | 3.8 |
| | — |
| | 114.5 |
|
| | | | | | | | | |
Selling, general and administrative expenses | 4.5 |
| | 74.6 |
| | 3.9 |
| | — |
| | 83.0 |
|
Amortization of intangible assets | — |
| | 5.7 |
| | — |
| | — |
| | 5.7 |
|
Restructuring expense | — |
| | 0.5 |
| | — |
| | — |
| | 0.5 |
|
Other operating expenses, net | — |
| | 0.1 |
| | — |
| | — |
| | 0.1 |
|
Operating (Loss) Profit | (4.5 | ) | | 29.8 |
| | (0.1 | ) | | — |
| | 25.2 |
|
| | | | | | | | | |
Interest expense | 29.0 |
| | — |
| | — |
| | — |
| | 29.0 |
|
(Loss) Earnings before Income Taxes | (33.5 | ) | | 29.8 |
| | (0.1 | ) | | — |
| | (3.8 | ) |
Income tax (benefit) expense | (11.9 | ) | | 10.5 |
| | — |
| | — |
| | (1.4 | ) |
Net (Loss) Earnings before Equity in Subsidiaries | (21.6 | ) | | 19.3 |
| | (0.1 | ) | | — |
| | (2.4 | ) |
Equity earnings in subsidiary | 19.2 |
| | — |
| | — |
| | (19.2 | ) | | — |
|
Net Earnings (Loss) | $ | (2.4 | ) | | $ | 19.3 |
| | $ | (0.1 | ) | | $ | (19.2 | ) | | $ | (2.4 | ) |
Total Comprehensive (Loss) Income | $ | (4.7 | ) | | $ | 19.2 |
| | $ | (2.3 | ) | | $ | (16.9 | ) | | $ | (4.7 | ) |
|
| | | | | | | | | | | | | | | | | | | |
| Three Months Ended December 31, 2012 |
| Parent | | | | Non- | | | | |
| Company | | Guarantors | | Guarantors | | Eliminations | | Total |
Net Sales | $ | — |
| | $ | 223.3 |
| | $ | 20.9 |
| | $ | (7.3 | ) | | $ | 236.9 |
|
Cost of goods sold | — |
| | 122.2 |
| | 16.3 |
| | (7.3 | ) | | 131.2 |
|
Gross Profit | — |
| | 101.1 |
| | 4.6 |
| | — |
| | 105.7 |
|
| | | | | | | | | |
Selling, general and administrative expenses | 2.5 |
| | 65.4 |
| | 4.2 |
| | — |
| | 72.1 |
|
Amortization of intangible assets | — |
| | 3.2 |
| | — |
| | — |
| | 3.2 |
|
Other operating expenses, net | — |
| | 0.1 |
| | — |
| | — |
| | 0.1 |
|
Operating (Loss) Profit | (2.5 | ) | | 32.4 |
| | 0.4 |
| | — |
| | 30.3 |
|
| | | | | | | | | |
Interest expense | 19.2 |
| | — |
| | — |
| | — |
| | 19.2 |
|
(Loss) Earnings before Income Taxes | (21.7 | ) | | 32.4 |
| | 0.4 |
| | — |
| | 11.1 |
|
Income tax (benefit) expense | (7.0 | ) | | 10.4 |
| | 0.1 |
| | — |
| | 3.5 |
|
Net (Loss) Earnings before Equity in Subsidiaries | (14.7 | ) | | 22.0 |
| | 0.3 |
| | — |
| | 7.6 |
|
Equity earnings in subsidiary | 22.3 |
| | — |
| | — |
| | (22.3 | ) | | — |
|
Net Earnings | $ | 7.6 |
| | $ | 22.0 |
| | $ | 0.3 |
| | $ | (22.3 | ) | | $ | 7.6 |
|
Total Comprehensive Income (Loss) | $ | 7.1 |
| | $ | 22.2 |
| | $ | (0.4 | ) | | $ | (21.8 | ) | | $ | 7.1 |
|
POST HOLDINGS, INC.
CONDENSED CONSOLIDATING BALANCE SHEETS (Unaudited)
|
| | | | | | | | | | | | | | | | | | | |
| December 31, 2013 |
| Parent | | | | Non- | | | | |
| Company | | Guarantors | | Guarantors | | Eliminations | | Total |
| |
ASSETS |
Current Assets | | | | | | | | | |
Cash and cash equivalents | $ | 877.9 |
| | $ | 0.9 |
| | $ | 8.6 |
| | $ | (2.5 | ) | | $ | 884.9 |
|
Restricted cash | 1.1 |
| | — |
| | — |
| | — |
| | 1.1 |
|
Receivables, net | — |
| | 78.3 |
| | 9.8 |
| | (3.2 | ) | | 84.9 |
|
Inventories | — |
| | 116.3 |
| | 4.5 |
| | — |
| | 120.8 |
|
Deferred income taxes | 12.1 |
| | — |
| | — |
| | — |
| | 12.1 |
|
Prepaid expenses and other current assets | 3.9 |
| | 6.6 |
| | 0.3 |
| | — |
| | 10.8 |
|
Total Current Assets | 895.0 |
| | 202.1 |
| | 23.2 |
| | (5.7 | ) | | 1,114.6 |
|
Property, net | — |
| | 344.4 |
| | 43.3 |
| | — |
| | 387.7 |
|
Goodwill | — |
| | 1,483.4 |
| | 6.2 |
| | — |
| | 1,489.6 |
|
Other intangible assets, net | — |
| | 892.7 |
| | — |
| | — |
| | 892.7 |
|
Intercompany receivable | 394.8 |
| | — |
| | — |
| | (394.8 | ) | | — |
|
Investment in subsidiaries | 2,396.3 |
| | — |
| | — |
| | (2,396.3 | ) | | — |
|
Cash advance for acquisitions | 366.2 |
| | — |
| | — |
| | — |
| | 366.2 |
|
Deferred income taxes | — |
| | — |
| | 2.2 |
| | — |
| | 2.2 |
|
Other assets | 31.5 |
| | 3.9 |
| | 0.7 |
| | — |
| | 36.1 |
|
Total Assets | $ | 4,083.8 |
| | $ | 2,926.5 |
| | $ | 75.6 |
| | $ | (2,796.8 | ) | | $ | 4,289.1 |
|
| | | | | | | | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY |
Current Liabilities | | | | | | | | | |
Accounts payable | $ | 0.6 |
| | $ | 57.7 |
| | $ | 4.2 |
| | $ | (5.7 | ) | | $ | 56.8 |
|
Other current liabilities | 49.7 |
| | 39.6 |
| | 5.0 |
| | — |
| | 94.3 |
|
Total Current Liabilities | 50.3 |
| | 97.3 |
| | 9.2 |
| | (5.7 | ) | | 151.1 |
|
Long-term debt | 1,932.9 |
| | — |
| | — |
| | — |
| | 1,932.9 |
|
Intercompany payable | — |
| | 394.5 |
| | 0.3 |
| | (394.8 | ) | | — |
|
Deferred income taxes | 302.4 |
| | — |
| | — |
| | — |
| | 302.4 |
|
Other liabilities | 12.5 |
| | 97.3 |
| | 7.2 |
| | — |
| | 117.0 |
|
Total Liabilities | 2,298.1 |
| | 589.1 |
| | 16.7 |
| | (400.5 | ) | | 2,503.4 |
|
| | | | | | | | | |
Total Stockholders’ Equity | 1,785.7 |
| | 2,337.4 |
| | 58.9 |
| | (2,396.3 | ) | | 1,785.7 |
|
Total Liabilities and Stockholders’ Equity | $ | 4,083.8 |
| | $ | 2,926.5 |
| | $ | 75.6 |
| | $ | (2,796.8 | ) | | $ | 4,289.1 |
|
|
| | | | | | | | | | | | | | | | | | | |
| September 30, 2013 |
| Parent | | | | Non- | | | | |
| Company | | Guarantors | | Guarantors | | Eliminations | | Total |
| |
ASSETS |
Current Assets | | | | | | | | | |
Cash and cash equivalents | $ | 391.4 |
| | $ | 4.1 |
| | $ | 8.2 |
| | $ | (1.7 | ) | | $ | 402.0 |
|
Restricted cash | 38.1 |
| | — |
| | — |
| | — |
| | 38.1 |
|
Receivables, net | 0.3 |
| | 75.9 |
| | 10.9 |
| | (3.9 | ) | | 83.2 |
|
Inventories | — |
| | 115.9 |
| | 6.0 |
| | — |
| | 121.9 |
|
Deferred income taxes | 11.8 |
| | — |
| | 0.1 |
| | — |
| | 11.9 |
|
Prepaid expenses and other current assets | 3.2 |
| | 7.4 |
| | 0.4 |
| | — |
| | 11.0 |
|
Total Current Assets | 444.8 |
| | 203.3 |
| | 25.6 |
| | (5.6 | ) | | 668.1 |
|
Property, net | — |
| | 342.4 |
| | 46.1 |
| | — |
| | 388.5 |
|
Goodwill | — |
| | 1,483.3 |
| | 6.4 |
| | — |
| | 1,489.7 |
|
Other intangible assets, net | — |
| | 898.4 |
| | — |
| | — |
| | 898.4 |
|
Intercompany receivable | 391.9 |
| | — |
| | — |
| | (391.9 | ) | | — |
|
Investment in subsidiaries | 2,384.0 |
| | — |
| | — |
| | (2,384.0 | ) | | — |
|
Deferred income taxes | — |
| | — |
| | 2.4 |
| | — |
| | 2.4 |
|
Other assets | 24.0 |
| | 2.7 |
| | — |
| | — |
| | 26.7 |
|
Total Assets | $ | 3,244.7 |
| | $ | 2,930.1 |
| | $ | 80.5 |
| | $ | (2,781.5 | ) | | $ | 3,473.8 |
|
| | | | | | | | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY |
Current Liabilities | | | | | | | | | |
Accounts payable | $ | 0.5 |
| | $ | 76.9 |
| | $ | 5.3 |
| | $ | (5.6 | ) | | $ | 77.1 |
|
Other current liabilities | 18.5 |
| | 43.8 |
| | 6.6 |
| | — |
| | 68.9 |
|
Total Current Liabilities | 19.0 |
| | 120.7 |
| | 11.9 |
| | (5.6 | ) | | 146.0 |
|
Long-term debt | 1,408.6 |
| | — |
| | — |
| | — |
| | 1,408.6 |
|
Intercompany payable | — |
| | 391.7 |
| | 0.2 |
| | (391.9 | ) | | — |
|
Deferred income taxes | 304.3 |
| | — |
| | — |
| | — |
| | 304.3 |
|
Other liabilities | 14.2 |
| | 94.9 |
| | 7.2 |
| | — |
| | 116.3 |
|
Total Liabilities | 1,746.1 |
| | 607.3 |
| | 19.3 |
| | (397.5 | ) | | 1,975.2 |
|
Total Stockholders’ Equity | 1,498.6 |
| | 2,322.8 |
| | 61.2 |
| | (2,384.0 | ) | | 1,498.6 |
|
Total Liabilities and Stockholders’ Equity | $ | 3,244.7 |
| | $ | 2,930.1 |
| | $ | 80.5 |
| | $ | (2,781.5 | ) | | $ | 3,473.8 |
|
POST HOLDINGS, INC.
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (Unaudited)
|
| | | | | | | | | | | | | | | | | | | |
| Three Months Ended December 31, 2013 |
| Parent | | | | Non- | | | | |
| Company | | Guarantors | | Guarantors | | Eliminations | | Total |
Net Cash Provided by Operating Activities | $ | 11.7 |
| | $ | 26.9 |
| | $ | 1.0 |
| | $ | (14.7 | ) | | $ | 24.9 |
|
| | | | | | | | | |
Cash Flows from Investing Activities | | | | | | | | | |
Cash advance for acquisition | (366.2 | ) | | — |
| | — |
| | — |
| | (366.2 | ) |
Additions to property | — |
| | (16.2 | ) | | (0.3 | ) | | — |
| | (16.5 | ) |
Restricted cash | 37.0 |
| | — |
| | — |
| | — |
| | 37.0 |
|
Net Cash Used in Investing Activities | (329.2 | ) | | (16.2 | ) | | (0.3 | ) | | — |
| | (345.7 | ) |
| | | | | | | | | |
Cash Flows from Financing Activities | | | | | | | | | |
Proceeds from issuance of senior notes | 525.0 |
| | — |
| | — |
| | — |
| | 525.0 |
|
Proceeds from issuance of preferred stock | 290.8 |
| | — |
| | — |
| | — |
| | 290.8 |
|
Repayments of long-term debt | — |
| | — |
| | — |
| | — |
| | — |
|
Payment of dividend | (2.3 | ) | | — |
| | — |
| | — |
| | (2.3 | ) |
Payments of debt issuance costs | (8.8 | ) | | — |
| | — |
| | — |
| | (8.8 | ) |
Other | (0.1 | ) | | — |
| | — |
| | — |
| | (0.1 | ) |
Payments for equity distributions | — |
| | (13.9 | ) | | — |
| | 13.9 |
| | — |
|
Net Cash Provided (Used) by Financing Activities | 804.6 |
| | (13.9 | ) | | — |
| | 13.9 |
| | 804.6 |
|
Effect of exchange rate changes on cash and cash equivalents | (0.6 | ) | | — |
| | (0.3 | ) | | — |
| | (0.9 | ) |
| | | | | | | | | |
Net Increase (Decrease) in Cash and Cash Equivalents | 486.5 |
| | (3.2 | ) | | 0.4 |
| | (0.8 | ) | | 482.9 |
|
Cash and Cash Equivalents, Beginning of Year | 391.4 |
| | 4.1 |
| | 8.2 |
| | (1.7 | ) | | 402.0 |
|
Cash and Cash Equivalents, End of Period | $ | 877.9 |
| | $ | 0.9 |
| | $ | 8.6 |
| | $ | (2.5 | ) | | $ | 884.9 |
|
|
| | | | | | | | | | | | | | | | | | | |
| Three Months Ended December 31, 2012 |
| Parent | | | | Non- | | | | |
| Company | | Guarantors | | Guarantors | | Eliminations | | Total |
Net Cash Provided by Operating Activities | $ | 17.5 |
| | $ | 6.3 |
| | $ | (0.2 | ) | | $ | — |
| | $ | 23.6 |
|
| | | | | | | | | |
Cash Flows from Investing Activities | | | | | | | | | |
Business acquisitions | — |
| | (9.2 | ) | | — |
| | — |
| | (9.2 | ) |
Additions to property | — |
| | (4.8 | ) | | (0.2 | ) | | — |
| | (5.0 | ) |
Payment for equity contributions | (8.1 | ) | | — |
| | — |
| | 8.1 |
| | — |
|
Net Cash Provided by (Used in) Investing Activities | (8.1 | ) | | (14.0 | ) | | (0.2 | ) | | 8.1 |
| | (14.2 | ) |
| | | | | | | | | |
Cash Flows from Financing Activities | | | | | | | | | |
Proceeds from issuance of senior notes | 250.0 |
| | — |
| | — |
| | — |
| | 250.0 |
|
Repayments of long-term debt | (2.2 | ) | | — |
| | — |
| | — |
| | (2.2 | ) |
Payments of debt issuance costs | (4.6 | ) | | — |
| | — |
| | — |
| | (4.6 | ) |
Other, net | 0.2 |
| | — |
| | — |
| | — |
| | 0.2 |
|
Proceeds from equity contributions | — |
| | 8.1 |
| | — |
| | (8.1 | ) | | — |
|
Net Cash Provided (Used) by Financing Activities | 243.4 |
| | 8.1 |
| | — |
| | (8.1 | ) | | 243.4 |
|
Effect of Exchange Rate Changes on Cash | — |
| | — |
| | (0.1 | ) | | — |
| | (0.1 | ) |
| | | | | | | | | |
Net Increase in Cash and Cash Equivalents | 252.8 |
| | 0.4 |
| | (0.5 | ) | | — |
| | 252.7 |
|
|