Subsidiary Guarantors of Senior Notes due 2024

12 Months Ended

Dec. 31, 2017

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Subsidiary Guarantors of Senior Notes due 2024

Subsidiary Guarantors of Senior Notes due 2024

The following tables present consolidating financial information for (a) Welbilt; (b) the guarantors of the Senior Notes, which include substantially all of the domestic, 100% owned subsidiaries of Welbilt ("Subsidiary Guarantors"); and (c) the wholly owned foreign subsidiaries of Welbilt, which do not guarantee the Senior Notes ("Non-Guarantor Subsidiaries"). The information includes elimination entries necessary to consolidate the Subsidiary Guarantors and the Non-Guarantor Subsidiaries. Investments in subsidiaries are accounted for using the equity method of accounting. The principal elimination entries eliminate investments in subsidiaries, equity and intercompany balances and transactions. Separate financial statements of the Subsidiary Guarantors are not presented because the guarantors are fully and unconditionally, jointly and severally liable under the guarantees, except for normal and customary release provisions.

The Company identified errors as described in Note 1, “Business and Organization,” and has restated the consolidated financial statements for the year ended December 31, 2016 and revised the Company's consolidated financial statements for the years ended December 31, 2017 and 2015 each within this footnote to correct the identified errors. Additionally, it was determined that there were classification errors within the operating and investing sections of the statement of cash flows for Subsidiary Guarantors and Non-Guarantor Subsidiaries. Specifically, operating cash flows for Subsidiary Guarantors decreased offset by an increase in investing cash flows while operating cash flows for Non-Guarantor Subsidiaries increased offset by a decrease in investing cash flows. The misclassification was $27.5 million for the year ended December 31, 2016. This error is eliminated in consolidation and therefore has no impact on the Company’s consolidated financial condition, results of operations or cash flows. The Company has restated the consolidating statements of cash flows for the Subsidiary Guarantors and Non-Guarantor Subsidiaries for the year ended December 31, 2016 to correct for this and one additional immaterial classification error.

Consolidating Statement of Operations

For the year ended December 31, 2016

(As Restated)

(in millions)	Parent			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Net sales	$	—		$	1,069.5	$	782.2		$	(395.6	)	$	1,456.1
Cost of sales	3.4			774.4		540.1			(395.6		)	922.3
Gross profit	(3.4		)	295.1		242.1			—			533.8
Selling, general and administrative expenses	35.5			153.9		101.7			—			291.1
Amortization expense	—			28.4		2.8			—			31.2
Separation expense	6.3			—		0.2			—			6.5
Restructuring expense	—			1.6		0.9			—			2.5
Loss from impairment or disposal of assets — net	—			2.9		0.4			—			3.3
(Loss) earnings from operations	(45.2		)	108.3		136.1			—			199.2
Interest expense	82.2			1.2		1.8			—			85.2
Interest expense on notes with MTW — net	—			—		0.1			—			0.1
Loss on early extinguishment of debt	2.7			—		—			—			2.7
Other (income) expense — net	(5.7		)	16.0		(1.3		)	—			9.0
Equity in earnings (loss) of subsidiaries	194.1			115.4		—			(309.5		)	—
Earnings (loss) before income taxes	69.7			206.5		135.5			(309.5		)	102.2
Income taxes	(1.8		)	12.4		20.1			—			30.7
Net earnings (loss)	$	71.5		$	194.1	$	115.4		$	(309.5	)	$	71.5
Total other comprehensive income (loss), net of tax	1.1			3.0		7.3			(10.3		)	1.1
Comprehensive income (loss)	$	72.6		$	197.1	$	122.7		$	(319.8	)	$	72.6

WELBILT, INC.

Consolidating Statement of Operations

For the year ended December 31, 2015

(in millions)	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Net sales	$	—		$	1,109.8		$	809.9		$	(349.6	)	$	1,570.1
Cost of sales	0.1			803.6			614.3			(349.6		)	1,068.4
Gross profit	(0.1		)	306.2			195.6			—			501.7
Selling, general and administrative expenses	32.2			144.6			114.8			—			291.6
Amortization expense	—			28.5			2.9			—			31.4
Separation expense (income)	4.4			0.1			(0.2		)	—			4.3
Restructuring expense	—			1.9			2.7			—			4.6
Loss from impairment or disposal of assets — net	—			8.4			1.5						9.9
(Loss) earnings from operations	(36.7		)	122.7			73.9			—			159.9
Interest expense	—			1.2			0.2			—			1.4
Interest income on notes with MTW — net	—			(14.9		)	(0.9		)	—			(15.8		)
Other (income) expense — net	(78.6		)	77.8			(21.3		)	—			(22.1		)
Equity in earnings (loss) of subsidiaries	122.2			77.9			—			(200.1		)	—
Earnings (loss) before income taxes	164.1			136.5			95.9			(200.1		)	196.4
Income taxes	8.0			14.3			18.0			—			40.3
Net earnings (loss)	$	156.1		$	122.2		$	77.9		$	(200.1	)	$	156.1
Total other comprehensive (loss) income, net of tax	(23.8		)	(27.7		)	(26.9		)	54.6			(23.8		)
Comprehensive income (loss)	$	132.3		$	94.5		$	51.0		$	(145.5	)	$	132.3

Consolidating Balance Sheet

As of December 31, 2017

(in millions)	Parent		Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	8.8	$	—	$	120.4		$	(0.8	)	$	128.4
Restricted cash	—		—		0.3			—			0.3
Accounts receivable — net	—		—		84.7			(1.0		)	83.7
Inventories — net	—		69.8		82.5			—			152.3
Prepaids and other current assets	5.3		5.9		7.8			—			19.0
Total current assets	14.1		75.7		295.7			(1.8		)	383.7
Property, plant and equipment — net	0.5		68.7		43.0			—			112.2
Goodwill	—		832.4		13.7			—			846.1
Other intangible assets — net	—		396.3		65.1			—			461.4
Intercompany long-term note receivable	—		20.0		—			(20.0		)	—
Due from affiliates	—		3,252.8		—			(3,252.8		)	—
Investment in subsidiaries	4,009.4		—		—			(4,009.4		)	—
Other non-current assets	10.8		5.2		28.7			(7.7		)	37.0
Total assets	$	4,034.8	$	4,651.1	$	446.2		$	(7,291.7	)	$	1,840.4
Liabilities and equity
Current liabilities:
Accounts payable	$	0.2	$	58.2	$	47.0		$	(1.8	)	$	103.6
Accrued expenses and other liabilities	20.7		95.9		52.9			—			169.5
Current portion of capital leases	—		0.5		0.2			—			0.7
Product warranties	—		16.2		7.9			—			24.1
Total current liabilities	20.9		170.8		108.0			(1.8		)	297.9
Long-term debt and capital leases	1,230.2		1.2		0.8			—			1,232.2
Deferred income taxes	73.7		—		17.6			—			91.3
Pension and postretirement health obligations	51.3		4.7		—			(7.7		)	48.3
Intercompany long-term note payable	15.7		—		4.3			(20.0		)	—
Due to affiliates	2,501.4		—		751.4			(3,252.8		)	—
Investment in subsidiaries	—		440.2		—			(440.2		)	—
Other long-term liabilities	38.0		24.8		4.3			—			67.1
Total non-current liabilities	3,910.3		470.9		778.4			(3,720.7		)	1,438.9
Total equity (deficit):
Total equity (deficit)	103.6		4,009.4		(440.2		)	(3,569.2		)	103.6
Total liabilities and equity	$	4,034.8	$	4,651.1	$	446.2		$	(7,291.7	)	$	1,840.4

WELBILT, INC.

Consolidating Balance Sheet

As of December 31, 2016

(As Restated)

(in millions)	Parent			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	0.4		$	2.3	$	51.1		$	—		$	53.8
Restricted cash	—			—		6.4			—			6.4
Accounts receivable — net	0.5			—		86.1			(4.9		)	81.7
Inventories — net	—			74.3		71.3			—			145.6
Prepaids and other current assets	0.9			4.5		8.5			—			13.9
Current assets held for sale	—			2.3		4.5			—			6.8
Total current assets	1.8			83.4		227.9			(4.9		)	308.2
Property, plant and equipment — net	1.2			67.9		40.0			—			109.1
Goodwill	—			832.4		12.9			—			845.3
Other intangible assets — net	—			423.5		60.9			—			484.4
Intercompany long-term note receivable	—			20.0		—			(20.0		)	—
Due from affiliates	—			3,089.4		—			(3,089.4		)	—
Investment in subsidiaries	3,776.8			—		—			(3,776.8		)	—
Other non-current assets	2.7			5.1		19.7			(5.4		)	22.1
Total assets	$	3,782.5		$	4,521.7	$	361.4		$	(6,896.5	)	$	1,769.1
Liabilities and equity
Current liabilities:
Accounts payable	$	0.1		$	64.6	$	48.6		$	(4.9	)	$	108.4
Accrued expenses and other liabilities	13.7			102.9		61.0			—			177.6
Current portion of capital leases	—			0.5		1.1			—			1.6
Product warranties	—			18.4		9.5			—			27.9
Current liabilities held for sale	—			—		0.7			—			0.7
Total current liabilities	13.8			186.4		120.9			(4.9		)	316.2
Long-term debt and capital leases	1,279.6			1.7		—			—			1,281.3
Deferred income taxes	127.7			—		17.3			—			145.0
Pension and postretirement health obligations	47.9			4.9		—			(5.4		)	47.4
Intercompany long-term note payable	15.7			—		4.3			(20.0		)	—
Due to affiliates	2,344.8			—		744.6			(3,089.4		)	—
Investment in subsidiaries	—			526.3		—			(526.3		)	—
Other long-term liabilities	9.4			25.6		0.6			—			35.6
Total non-current liabilities	3,825.1			558.5		766.8			(3,641.1		)	1,509.3
Total (deficit) equity:
Total (deficit) equity	(56.4		)	3,776.8		(526.3		)	(3,250.5		)	(56.4		)
Total liabilities and equity	$	3,782.5		$	4,521.7	$	361.4		$	(6,896.5	)	$	1,769.1

Consolidating Statement of Cash Flows

For the year ended December 31, 2017

(in millions)	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities
Net cash (used in) provided by operating activities	$	(96.7	)	$	169.3		$	66.0		$	(0.8	)	$	137.8
Cash flows from investing activities
Capital expenditures	(0.5		)	(12.5		)	(7.7		)	—			(20.7		)
Proceeds from sale of property, plant and equipment	—			6.0			6.3			—			12.3
Changes in restricted cash	—			—			6.2			—			6.2
Acquisition of intangible assets	—			(1.2		)	—			—			(1.2		)
Intercompany investment	—			(163.4		)	6.8			156.6			—
Net cash (used in) provided by investing activities	(0.5		)	(171.1		)	11.6			156.6			(3.4		)
Cash flows from financing activities
Proceeds from long-term debt and capital leases	155.0			—			—			—			155.0
Repayments on long-term debt and capital leases	(203.4		)	(0.5		)	(0.2		)	—			(204.1		)
Proceeds from short-term borrowings	—			—			4.0			—			4.0
Repayment of short-term borrowings	—			—			(4.0		)	—			(4.0		)
Debt issuance costs	(2.0		)	—			—			—			(2.0		)
Exercises of stock options	4.8			—			—			—			4.8
Payments on tax withholdings for equity awards	(5.4		)	—			—			—			(5.4		)
Intercompany financing	156.6			—						(156.6		)	—
Net cash provided by (used in) financing activities	105.6			(0.5		)	(0.2		)	(156.6		)	(51.7		)
Effect of exchange rate changes on cash	—			—			(8.1		)	—			(8.1		)
Net increase in cash and cash equivalents	8.4			(2.3		)	69.3			(0.8		)	74.6
Balance at beginning of period	0.4			2.3			51.1			—			53.8
Balance at end of period	$	8.8		$	—		$	120.4		$	(0.8	)	$	128.4

WELBILT, INC.

Consolidating (Condensed) Statement of Cash Flows

For the year ended December 31, 2016

(As Restated)

(in millions)	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities
Net cash (used in) provided by operating activities	$	(100.4	)	$	84.0		$	140.7		$	—		$	124.3
Cash flows from investing activities
Capital expenditures	(1.0		)	(8.0		)	(7.0		)	—			(16.0		)
Changes in restricted cash	—			—			(6.0		)	—			(6.0		)
Proceeds from sale of property, plant and equipment	—			—			0.5						0.5
Proceeds from dispositions	—			—			1.1			—			1.1
Intercompany investment	—			(76.9		)	(106.9		)	183.8			—
Net cash (used in) provided by investing activities	(1.0		)	(84.9		)	(118.3		)	183.8			(20.4		)
Cash flows from financing activities
Proceeds from long-term debt and capital leases	1,499.5			0.2			1.4			—			1,501.1
Repayments on long-term debt and capital leases	(186.0		)	(0.5		)	(0.3		)	—			(186.8		)
Debt issuance costs	(41.3		)	—			—			—			(41.3		)
Dividends Paid to MTW	(1,362.0		)	—			—			—			(1,362.0		)
Net Transactions with MTW	(4.6		)	—			—			—			(4.6		)
Exercises of Stock Options	16.2			—			—			—			16.2
Payments on tax withholdings for equity awards	(3.8		)	—			—			—			(3.8		)
Intercompany financing	183.8			—			—			(183.8		)	—
Net cash provided by (used in) financing activities	101.8			(0.3		)	1.1			(183.8		)	(81.2		)
Effect of exchange rate changes on cash	—			—			(0.9		)	—			(0.9		)
Net increase in cash and cash equivalents	0.4			(1.2		)	22.6			—			21.8
Balance at beginning of period	—			3.5			28.5			—			32.0
Balance at end of period	$	0.4		$	2.3		$	51.1		$	—		$	53.8

WELBILT, INC.

Consolidating (Condensed) Statement of Cash Flows

For the year ended December 31, 2015

(in millions)	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities
Net cash provided by (used in) operating activities	$	376.9		$	(137.6	)	$	(96.3	)	$	—		$	143.0
Cash flows from investing activities
Capital expenditures	(0.8		)	(6.5		)	(5.9		)	—			(13.2		)
Changes in restricted cash	—			—			(0.6		)	—			(0.6		)
Business acquisitions, net of cash acquired	—			—			(5.3		)	—			(5.3		)
Proceeds from dispositions	—			78.2			—			—			78.2
Intercompany investment	(193.2		)	—			—			193.2			—
Net cash (used in) provided by investing activities	(194.0		)	71.7			(11.8		)	193.2			59.1
Cash flows from financing activities
Proceeds from long-term debt and capital leases	—			0.5			—			—			0.5
Repayments on long-term debt and capital leases	—			(0.7		)	—			—			(0.7		)
Net transactions with MTW	(182.9		)	—			—			—			(182.9		)
Intercompany financing	—			66.9			126.3			(193.2		)	—
Net cash (used in) provided by financing activities	(182.9		)	66.7			126.3			(193.2		)	(183.1		)
Effect of exchange rate changes on cash	—			—			(3.5		)	—			(3.5		)
Net increase in cash and cash equivalents	—			0.8			14.7			—			15.5
Balance at beginning of period	—			2.7			13.8			—			16.5
Balance at end of period	$	—		$	3.5		$	28.5		$	—		$	32.0