Guarantor Subsidiaries

6 Months Ended

Feb. 28, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

As discussed in Note 6, “Debt” on April 16, 2012, Actuant Corporation (the “Parent”) issued $300 million of 5.625% Senior Notes. All material domestic wholly owned subsidiaries (the “Guarantors”) fully and unconditionally guarantee (except for certain customary limitations) such debt on a joint and several basis. There are no significant restrictions on the ability of the Guarantors to make distributions to the Parent. The following tables present the results of operations, financial position and cash flows of Actuant Corporation and its subsidiaries, the Guarantor and non-Guarantor entities, and the eliminations necessary to arrive at the information for the Company on a consolidated basis.

Certain assets, liabilities and expenses have not been allocated to the Guarantors and non-Guarantors and therefore are included in the Parent column in the accompanying condensed consolidating financial statements. These items are of a corporate or consolidated nature and include, but are not limited to, tax provisions and related assets and liabilities, certain employee benefit obligations, prepaid and accrued insurance and corporate indebtedness. Intercompany activity primarily includes loan activity, purchases and sales of goods or services, investments and dividends. Intercompany balances also reflect certain non-cash transactions including transfers of assets and liabilities between the Parent, Guarantor and non-Guarantor, allocation of non-cash expenses from the Parent to the Guarantors and non-Guarantors and the impact of foreign currency rate changes.

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands)



	Three Months Ended February 28, 2015
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	39,335		$	70,675		$	190,995		$	—		$	301,005
Cost of products sold	12,076			52,182			126,986			—			191,244
Gross profit	27,259			18,493			64,009			—			109,761
Selling, administrative and engineering expenses	16,430			16,367			42,971			—			75,768
Amortization of intangible assets	318			2,785			2,984			—			6,087
Impairment charge	—			20,249			64,104			—			84,353
Operating profit (loss)	10,511			(20,908		)	(46,050		)	—			(56,447		)
Financing costs, net	7,267			—			(237		)	—			7,030
Intercompany expense (income), net	(5,098		)	849			4,249			—			—
Intercompany dividend income	(212		)	(243		)	(31		)	486			—
Other income, net	(246		)	(64		)	(309		)	—			(619		)
Earnings (loss) before income tax expense (benefit)	8,800			(21,450		)	(49,722		)	(486		)	(62,858		)
Income tax expense (benefit)	1,514			(207		)	757			(84		)	1,980
Net earnings (loss) before equity in earnings (loss) of subsidiaries	7,286			(21,243		)	(50,479		)	(402		)	(64,838		)
Equity in earnings (loss) of subsidiaries	(72,124		)	(28,577		)	323			100,378			—
Net loss	$	(64,838	)	$	(49,820	)	$	(50,156	)	$	99,976		$	(64,838	)
Comprehensive loss	$	(121,586	)	$	(65,247	)	$	(65,507	)	$	130,754		$	(121,586	)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(in thousands)



	Three Months Ended February 28, 2014
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	43,595		$	75,203		$	208,972		$	—		$	327,770
Cost of products sold	11,992			52,009			139,322			—			203,323
Gross profit	31,603			23,194			69,650			—			124,447
Selling, administrative and engineering expenses	19,399			13,753			46,088			—			79,240
Amortization of intangible assets	318			2,576			3,332			—			6,226
Operating profit	11,886			6,865			20,230			—			38,981
Financing costs, net	6,499			—			(237		)	—			6,262
Intercompany expense (income), net	(12,153		)	5,334			6,819			—			—
Other expense (income), net	669			(125		)	782			—			1,326
Earnings from continuing operations before income tax expense	16,871			1,656			12,866			—			31,393
Income tax expense	4,885			479			3,725			—			9,089
Net earnings before equity in earnings of subsidiaries	11,986			1,177			9,141			—			22,304
Equity in earnings (loss) of subsidiaries	50,097			(23,996		)	867			(26,968		)	—
Earnings (loss) from continuing operations	62,083			(22,819		)	10,008			(26,968		)	22,304
Earnings (loss) from discontinued operations, net of income taxes	(20,691		)	53,156			(13,377		)	—			19,088
Net earnings (loss)	$	41,392		$	30,337		$	(3,369	)	$	(26,968	)	$	41,392
Comprehensive income (loss)	$	45,789		$	34,943		$	(5,804	)	$	(29,139	)	$	45,789

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands)



	Six Months Ended February 28, 2015
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	79,601		$	148,266		$	400,903		$	—		$	628,770
Cost of products sold	22,043			105,440			264,550			—			392,033
Gross profit	57,558			42,826			136,353			—			236,737
Selling, administrative and engineering expenses	35,502			33,834			88,904			—			158,240
Amortization of intangible assets	636			5,570			6,167			—			12,373
Impairment charge	—			20,249			64,104			—			84,353
Operating profit (loss)	21,420			(16,827		)	(22,822		)	—			(18,229		)
Financing costs, net	13,814			—			(593		)	—			13,221
Intercompany expense (income), net	(10,830		)	2,083			8,747			—			—
Intercompany dividend income	(212		)	(243		)	(31		)	486			—
Other expense (income), net	219			(160		)	(1,117		)	—			(1,058		)
Earnings (loss) before income tax expense	18,429			(18,507		)	(29,828		)	(486		)	(30,392		)
Income tax expense	3,824			499			5,533			(84		)	9,772
Net earnings (loss) before equity in earnings (loss) of subsidiaries	14,605			(19,006		)	(35,361		)	(402		)	(40,164		)
Equity in earnings (loss) of subsidiaries	(54,769		)	(14,430		)	517			68,682			—
Net loss	$	(40,164	)	$	(33,436	)	$	(34,844	)	$	68,280		$	(40,164	)
Comprehensive loss	$	(159,875	)	$	(71,847	)	$	(88,657	)	$	160,504		$	(159,875	)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(in thousands)



	Six Months Ended February 28, 2014
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	88,686		$	154,839		$	423,801		$	—		$	667,326
Cost of products sold	24,064			107,264			279,771			—			411,099
Gross profit	64,622			47,575			144,030			—			256,227
Selling, administrative and engineering expenses	36,257			29,705			95,196			—			161,158
Amortization of intangible assets	636			5,151			6,654			—			12,441
Operating profit	27,729			12,719			42,180			—			82,628
Financing costs, net	13,278			3			(269		)	—			13,012
Intercompany expense (income), net	(17,150		)	4,995			12,155			—			—
Other expense (income), net	11,086			(418		)	(8,201		)	—			2,467
Earnings from continuing operations before income tax expense	20,515			8,139			38,495			—			67,149
Income tax expense	5,893			2,274			3,673			—			11,840
Net earnings before equity in earnings (loss) of subsidiaries	14,622			5,865			34,822			—			55,309
Equity in earnings (loss) of subsidiaries	84,319			(10,663		)	4,067			(77,723		)	—
Earnings (loss) from continuing operations	98,941			(4,798		)	38,889			(77,723		)	55,309
Earnings (loss) from discontinued operations, net of income taxes	(21,512		)	56,494			(12,862		)	—			22,120
Net earnings	$	77,429		$	51,696		$	26,027		$	(77,723	)	$	77,429
Comprehensive income	$	98,829		$	73,740		$	21,867		$	(95,607	)	$	98,829

CONDENSED CONSOLIDATING BALANCE SHEETS

(in thousands)



	February 28, 2015
	Parent			Guarantors			Non-Guarantors		Eliminations			Consolidated
ASSETS
Current assets
Cash and cash equivalents	$	5,553		$	1,937		$	80,007	$	—		$	87,497
Accounts receivable, net	17,648			42,966			143,448		—			204,062
Inventories, net	24,640			42,056			96,088		—			162,784
Deferred income taxes	7,579			—			3,034		—			10,613
Other current assets	16,563			2,502			29,210		—			48,275
Total current assets	71,983			89,461			351,787		—			513,231
Property, plant and equipment, net	7,161			25,998			120,019		—			153,178
Goodwill	38,847			263,141			313,965		—			615,953
Other intangibles, net	11,338			134,829			178,700		—			324,867
Investment in subsidiaries	2,051,045			1,014,867			13,273		(3,079,185		)	—
Intercompany receivable	—			639,140			544,177		(1,183,317		)	—
Other long-term assets	18,100			—			11,490		—			29,590
Total assets	$	2,198,474		$	2,167,436		$	1,533,411	$	(4,262,502	)	$	1,636,819
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable	$	15,948		$	23,535		$	87,401	$	—		$	126,884
Accrued compensation and benefits	13,278			2,997			25,514		—			41,789
Current maturities of debt	6,750			—			—		—			6,750
Income taxes payable	(6,309		)	(548		)	7,459		—			602
Other current liabilities	18,600			4,952			33,128		—			56,680
Total current liabilities	48,267			30,936			153,502		—			232,705
Long-term debt, less current maturities	580,000			—			—		—			580,000
Deferred income taxes	49,247			—			38,724		—			87,971
Pension and postretirement benefit liabilities	7,440			—			6,176		—			13,616
Other long-term liabilities	43,378			4,223			8,201		—			55,802
Intercompany payable	803,417			—			379,900		(1,183,317		)	—
Shareholders’ equity	666,725			2,132,277			946,908		(3,079,185		)	666,725
Total liabilities and shareholders’ equity	$	2,198,474		$	2,167,436		$	1,533,411	$	(4,262,502	)	$	1,636,819

CONDENSED CONSOLIDATING BALANCE SHEETS

(in thousands)



	August 31, 2014
	Parent		Guarantors		Non-Guarantors		Eliminations			Consolidated
ASSETS
Current assets
Cash and cash equivalents	$	27,931	$	3,325	$	77,756	$	—		$	109,012
Accounts receivable, net	22,811		38,511		165,686		—			227,008
Inventories, net	31,024		38,860		92,736		—			162,620
Deferred income taxes	7,503		—		3,547		—			11,050
Other current assets	3,871		1,057		28,372		—			33,300
Total current assets	93,140		81,753		368,097		—			542,990
Property, plant and equipment, net	9,096		22,879		137,126		—			169,101
Goodwill	44,700		280,693		417,377		—			742,770
Other intangibles, net	11,974		140,400		212,803		—			365,177
Investment in subsidiaries	2,286,068		806,414		237,207		(3,329,689		)	—
Intercompany receivable	—		678,073		622,818		(1,300,891		)	—
Other long-term assets	23,432		—		13,409		—			36,841
Total assets	$	2,468,410	$	2,010,212	$	2,008,837	$	(4,630,580	)	$	1,856,879
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable	$	20,014	$	25,673	$	100,111	$	—		$	145,798
Accrued compensation and benefits	15,135		3,293		34,536		—			52,964
Income taxes payable	31,582		—		6,765		—			38,347
Current maturities of debt	4,500		—		—		—			4,500
Other current liabilities	19,081		3,989		34,442		—			57,512
Total current liabilities	90,312		32,955		175,854		—			299,121
Long-term debt	385,500		—		—		—			385,500
Deferred income taxes	47,543		—		49,427		—			96,970
Pension and postretirement benefit liabilities	8,668		—		7,031		—			15,699
Other long-term liabilities	42,647		4,138		11,093		—			57,878
Intercompany payable	892,029		—		408,861		(1,300,890		)	—
Shareholders’ equity	1,001,711		1,973,119		1,356,571		(3,329,690		)	1,001,711
Total liabilities and shareholders’ equity	$	2,468,410	$	2,010,212	$	2,008,837	$	(4,630,580	)	$	1,856,879

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(in thousands)



	Six Months Ended February 28, 2015
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating Activities
Cash provided by (used in) operating activities	$	18,035		$	(41,149	)	$	13,495		$	—		$	(9,619	)
Investing Activities
Capital expenditures	(519		)	(2,447		)	(9,911		)	—			(12,877		)
Proceeds from sale of property, plant and equipment	—			198			509			—			707
Intercompany investment	(1,117		)	—			—			1,117			—
Cash used in investing activities	(1,636		)	(2,249		)	(9,402		)	1,117			(12,170		)
Financing Activities
Net borrowings on revolver	199,000			—			—			—			199,000
Repayment on term loan	(2,250		)	—			—			—			(2,250		)
Purchase of treasury shares	(180,512		)	—			—			—			(180,512		)
Intercompany loan activity	(57,170		)	42,010			15,160			—			—
Intercompany capital contribution	—			—			1,117			(1,117		)	—
Stock option exercises, related tax benefits and other	4,753			—			—			—			4,753
Cash dividend	(2,598		)	—			—			—			(2,598		)
Cash provided by (used in) financing activities	(38,777		)	42,010			16,277			(1,117		)	18,393
Effect of exchange rate changes on cash	—			—			(18,119		)	—			(18,119		)
Net (decrease) increase in cash and cash equivalents	(22,378		)	(1,388		)	2,251			—			(21,515		)
Cash and cash equivalents—beginning of period	27,931			3,325			77,756			—			109,012
Cash and cash equivalents—end of period	$	5,553		$	1,937		$	80,007		$	—		$	87,497

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(in thousands)



	Six Months Ended February 28, 2014
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating Activities
Cash provided by (used in) operating activities	$	(223	)	$	8,331		$	43,491		$	(14,716	)	$	36,883
Investing Activities
Capital expenditures	(2,424		)	(2,379		)	(17,423		)	—			(22,226		)
Proceeds from sale of property, plant and equipment	1			74			1,933			—			2,008
Proceeds from sale of businesses, net	(4,134		)	214,268			33,252			—			243,386
Intercompany investment	—			(99,963		)	—			99,963			—
Cash provided by (used in) investing activities	(6,557		)	112,000			17,762			99,963			223,168
Financing Activities
Net repayments on revolver	(125,000		)	—			—			—			(125,000		)
Purchase of treasury shares	(109,095		)	—			—			—			(109,095		)
Intercompany loan activity	213,449			(120,305		)	(93,144		)	—			—
Intercompany capital contribution	—			—			99,963			(99,963		)	—
Stock option exercises and related tax benefits	25,803			—			—			—			25,803
Payment of contingent acquisition consideration	—			—			(753		)	—			(753		)
Cash dividend	(2,919		)	—			(14,716		)	14,716			(2,919		)
Cash provided by (used in) financing activities	2,238			(120,305		)	(8,650		)	(85,247		)	(211,964		)
Effect of exchange rate changes on cash	—			—			2,944			—			2,944
Net increase (decrease) in cash and cash equivalents	(4,542		)	26			55,547			—			51,031
Cash and cash equivalents—beginning of period	16,122			—			87,864			—			103,986
Cash and cash equivalents—end of period	$	11,580		$	26		$	143,411		$	—		$	155,017