Guarantor Subsidiaries

9 Months Ended

May 31, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

As discussed in Note 5, “Debt” on April 16, 2012, Actuant Corporation (the “Parent”) issued $300.0 million of 5.625% Senior Notes, of which $288.1 million remains outstanding as of May 31, 2016. All of our material domestic wholly owned subsidiaries (the “Guarantors”) fully and unconditionally guarantee the 5.625% Senior Notes 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, non-cash intercompany dividends and the impact of foreign currency rate changes.

CONDENSED CONSOLIDATING STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME

(in thousands)



	Three Months Ended May 31, 2016
	Parent			Guarantors		Non-Guarantors			Eliminations			Consolidated
Net sales	$	33,610		$	62,534	$	209,197		$	—		$	305,341
Cost of products sold	6,603			43,381		147,831			—			197,815
Gross profit	27,007			19,153		61,366			—			107,526
Selling, administrative and engineering expenses	17,172			13,606		39,342			—			70,120
Amortization of intangible assets	318			2,630		2,619			—			5,567
Restructuring charges	100			197		3,199			—			3,496
Operating profit	9,417			2,720		16,206			—			28,343
Financing costs, net	7,601			—		(348		)	—			7,253
Intercompany (income) expense, net	(4,990		)	1,254		3,736			—			—
Other expense, net	199			13		539			—			751
Earnings before income taxes	6,607			1,453		12,279			—			20,339
Income tax expense (benefit)	(929		)	115		(13		)	—			(827		)
Net earnings before equity in earnings of subsidiaries	7,536			1,338		12,292			—			21,166
Equity in earnings of subsidiaries	13,630			10,382		239			(24,251		)	—
Net earnings	$	21,166		$	11,720	$	12,531		$	(24,251	)	$	21,166
Comprehensive income	$	36,488		$	25,205	$	14,148		$	(39,353	)	$	36,488

CONDENSED CONSOLIDATING STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME

(in thousands)



	Three Months Ended May 31, 2015
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	40,011		$	58,896		$	221,193		$	—		$	320,100
Cost of products sold	11,749			40,360			149,431			—			201,540
Gross profit	28,262			18,536			71,762			—			118,560
Selling, administrative and engineering expenses	16,560			11,228			41,781			—			69,569
Amortization of intangible assets	318			2,394			3,277			—			5,989
Operating profit	11,384			4,914			26,704			—			43,002
Financing costs, net	7,769			—			(307		)	—			7,462
Intercompany (income) expense, net	(3,559		)	(1,187		)	4,746			—			—
Other expense, net	123			27			419			—			569
Earnings before income taxes	7,051			6,074			21,846			—			34,971
Income tax expense (benefit)	(11,957		)	914			8,056			—			(2,987		)
Net earnings before equity in earnings (loss) of subsidiaries	19,008			5,160			13,790			—			37,958
Equity in earnings (loss) of subsidiaries	18,950			12,757			(340		)	(31,367		)	—
Net earnings	$	37,958		$	17,917		$	13,450		$	(31,367	)	$	37,958
Comprehensive income	$	27,259		$	13,244		$	7,930		$	(21,174	)	$	27,259

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands)



	Nine Months Ended May 31, 2016
	Parent			Guarantors			Non-Guarantors			Eliminations		Consolidated
Net sales	$	100,699		$	188,333		$	584,609		$	—	$	873,641
Cost of products sold	25,851			132,711			407,962			—		566,524
Gross profit	74,848			55,622			176,647			—		307,117
Selling, administrative and engineering expenses	54,049			41,113			115,040			—		210,202
Amortization of intangible assets	954			7,890			8,503			—		17,347
Restructuring charges	1,057			2,692			7,709			—		11,458
Impairment charges	—			49,012			137,499			—		186,511
Operating profit (loss)	18,788			(45,085		)	(92,104		)	—		(118,401		)
Financing costs, net	22,364			—			(1,128		)	—		21,236
Intercompany (income) expense, net	(16,284		)	(1,478		)	17,762			—		—
Other expense, net	802			44			759			—		1,605
Earnings (loss) before income taxes	11,906			(43,651		)	(109,497		)	—		(141,242		)
Income tax expense (benefit)	(1,986		)	420			(17,100		)	—		(18,666		)
Net earnings (loss) before equity in loss of subsidiaries	13,892			(44,071		)	(92,397		)	—		(122,576		)
Equity in earnings (loss) of subsidiaries	(136,468		)	(79,373		)	236			215,605		—
Net loss	$	(122,576	)	$	(123,444	)	$	(92,161	)	$	215,605	$	(122,576	)
Comprehensive loss	$	(142,339	)	$	(138,806	)	$	(97,165	)	$	235,971	$	(142,339	)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands)



	Nine Months Ended May 31, 2015
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	119,612		$	207,162		$	622,096		$	—		$	948,870
Cost of products sold	33,792			145,800			413,981			—			593,573
Gross profit	85,820			61,362			208,115			—			355,297
Selling, administrative and engineering expenses	52,062			45,062			130,685			—			227,809
Amortization of intangible assets	954			7,964			9,444			—			18,362
Impairment charges	—			20,249			64,104			—			84,353
Operating profit (loss)	32,804			(11,913		)	3,882			—			24,773
Financing costs, net	21,583			—			(900		)	—			20,683
Intercompany expense (income), net	(14,389		)	896			13,493			—			—
Intercompany dividend income	(212		)	(243		)	(31		)	486			—
Other expense (income), net	342			(133		)	(698		)	—			(489		)
Earnings (loss) before income taxes	25,480			(12,433		)	(7,982		)	(486		)	4,579
Income tax expense (benefit)	(8,133		)	1,413			13,589			(84		)	6,785
Net earnings (loss) before equity in earnings (loss) of subsidiaries	33,613			(13,846		)	(21,571		)	(402		)	(2,206		)
Equity in earnings (loss) of subsidiaries	(35,819		)	(1,673		)	177			37,315			—
Net loss	$	(2,206	)	$	(15,519	)	$	(21,394	)	$	36,913		$	(2,206	)
Comprehensive loss	$	(132,616	)	$	(58,603	)	$	(80,728	)	$	139,331		$	(132,616	)

CONDENSED CONSOLIDATING BALANCE SHEETS

(in thousands)



	May 31, 2016
	Parent		Guarantors		Non-Guarantors		Eliminations			Consolidated
ASSETS
Current assets
Cash and cash equivalents	$	8,199	$	—	$	128,890	$	—		$	137,089
Accounts receivable, net	13,367		33,889		152,846		—			200,102
Inventories, net	22,416		29,748		86,292		—			138,456
Other current assets	13,268		3,187		43,631		—			60,086
Total current assets	57,250		66,824		411,659		—			535,733
Property, plant and equipment, net	5,641		19,080		93,507		—			118,228
Goodwill	38,847		143,690		346,884		—			529,421
Other intangibles, net	9,747		98,411		147,763		—			255,921
Investment in subsidiaries	1,915,828		899,892		87,193		(2,902,913		)	—
Intercompany receivable	—		617,942		556,837		(1,174,779		)	—
Other long-term assets	9,877		7		18,233		—			28,117
Total assets	$	2,037,190	$	1,845,846	$	1,662,076	$	(4,077,692	)	$	1,467,420
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable	$	14,085	$	16,096	$	89,919	$	—		$	120,100
Accrued compensation and benefits	15,801		4,671		26,960		—			47,432
Current maturities of debt and short-term borrowings	15,000		—		—		—			15,000
Income taxes payable	—		—		1,249		—			1,249
Other current liabilities	23,187		4,937		30,756		—			58,880
Total current liabilities	68,073		25,704		148,884		—			242,661
Long-term debt, less current maturities	573,059		—		—		—			573,059
Deferred income taxes	34,641		—		20,891		—			55,532
Pension and postretirement benefit liabilities	10,228		—		5,461		—			15,689
Other long-term liabilities	47,083		593		8,954		—			56,630
Intercompany payable	780,257		—		394,522		(1,174,779		)	—
Shareholders’ equity	523,849		1,819,549		1,083,364		(2,902,913		)	523,849
Total liabilities and shareholders’ equity	$	2,037,190	$	1,845,846	$	1,662,076	$	(4,077,692	)	$	1,467,420

CONDENSED CONSOLIDATING BALANCE SHEETS

(in thousands)



	August 31, 2015
	Parent		Guarantors		Non-Guarantors		Eliminations			Consolidated
ASSETS
Current assets
Cash and cash equivalents	$	18,688	$	523	$	149,635	$	—		$	168,846
Accounts receivable, net	16,135		33,748		143,198		—			193,081
Inventories, net	23,074		33,480		86,198		—			142,752
Deferred income taxes	9,256		—		3,666		—			12,922
Other current assets	18,020		2,967		21,801		—			42,788
Total current assets	85,173		70,718		404,498		—			560,389
Property, plant and equipment, net	6,363		23,691		112,404		—			142,458
Goodwill	38,847		189,337		380,072		—			608,256
Other intangibles, net	10,702		109,665		188,395		—			308,762
Investment in subsidiaries	2,067,438		1,017,418		27,552		(3,112,408		)	—
Intercompany receivable	—		619,198		565,968		(1,185,166		)	—
Other long-term assets	10,694		—		6,358		—			17,052
Total assets	$	2,219,217	$	2,030,027	$	1,685,247	$	(4,297,574	)	$	1,636,917
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable	$	14,700	$	19,213	$	84,202	$	—		$	118,115
Accrued compensation and benefits	16,479		2,952		24,276		—			43,707
Current maturities of debt and short-term borrowings	3,750		—		219		—			3,969
Income taxes payable	10,947		—		3,858		—			14,805
Other current liabilities	19,817		4,783		29,860		—			54,460
Total current liabilities	65,693		26,948		142,415		—			235,056
Long-term debt, less current maturities	584,309		—		—		—			584,309
Deferred income taxes	43,210		—		29,731		—			72,941
Pension and postretirement benefit liabilities	11,712		—		6,116		—			17,828
Other long-term liabilities	46,407		400		6,975		—			53,782
Intercompany payable	794,885		—		390,281		(1,185,166		)	—
Shareholders’ equity	673,001		2,002,679		1,109,729		(3,112,408		)	673,001
Total liabilities and shareholders’ equity	$	2,219,217	$	2,030,027	$	1,685,247	$	(4,297,574	)	$	1,636,917

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(in thousands)



	Nine Months Ended May 31, 2016
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating Activities
Cash provided by operating activities	$	15,329		$	5,017		$	54,645		$	—		$	74,991
Investing Activities
Proceeds from sale of property, plant and equipment	13			3,337			5,285			—			8,635
Capital expenditures	(1,237		)	(3,091		)	(11,295		)	—			(15,623		)
Intercompany investment	(339		)	(6,125		)	—			6,464			—
Business acquisitions, net of cash acquired	—			—			(80,674		)	—			(80,674		)
Cash used in by investing activities	(1,563		)	(5,879		)	(86,684		)	6,464			(87,662		)
Financing Activities
Net repayments on revolver and other debt	—			—			(210		)	—			(210		)
Purchase of treasury shares	(14,125		)	—			—			—			(14,125		)
Taxes paid related to the net share settlement of equity awards	(1,344		)	—			—			—			(1,344		)
Stock option exercises, related tax benefits and other	5,729			—			—			—			5,729
Cash dividend	(2,376		)	—			—			—			(2,376		)
Intercompany loan activity	(12,139		)	—			12,139			—			—
Intercompany capital contribution	—			339			6,125			(6,464		)	—
Cash (used in) provided by financing activities	(24,255		)	339			18,054			(6,464		)	(12,326		)
Effect of exchange rate changes on cash	—			—			(6,760		)	—			(6,760		)
Net decrease in cash and cash equivalents	(10,489		)	(523		)	(20,745		)	—			(31,757		)
Cash and cash equivalents—beginning of period	18,688			523			149,635			—			168,846
Cash and cash equivalents—end of period	$	8,199		$	—		$	128,890		$	—		$	137,089

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(in thousands)



	Nine Months Ended May 31, 2015
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating Activities
Net cash provided by (used in) operating activities	$	38,854		$	(39,865	)	$	44,635		$	—		$	43,624
Investing Activities
Capital expenditures	(880		)	(3,495		)	(12,859		)	—			(17,234		)
Proceeds from sale of property, plant and equipment	—			203			683			—			886
Intercompany investment	(1,117		)	—			—			1,117			—
Cash used in investing activities	(1,997		)	(3,292		)	(12,176		)	1,117			(16,348		)
Financing Activities
Principal repayment on term loan	(3,375		)	—			—			—			(3,375		)
Proceeds from term loan	213,375			—			—			—			213,375
Purchase of treasury shares	(204,627		)	—			—			—			(204,627		)
Taxes paid related to the net share settlement of equity awards	(2,344		)	—			—			—			(2,344		)
Stock option exercises, related tax benefits and other	5,046			—			—			—			5,046
Debt issuance costs	(1,875		)	—			—			—			(1,875		)
Cash dividend	(2,598		)	—			—			—			(2,598		)
Intercompany loan activity	(58,569		)	40,796			17,773			—			—
Intercompany capital contribution	—			—			1,117			(1,117		)	—
Cash (used in) provided by financing activities	(54,967		)	40,796			18,890			(1,117		)	3,602
Effect of exchange rate changes on cash	—			—			(31,765		)	—			(31,765		)
Net (decrease) increase in cash and cash equivalents	(18,110		)	(2,361		)	19,584			—			(887		)
Cash and cash equivalents—beginning of period	27,931			3,325			77,756			—			109,012
Cash and cash equivalents—end of period	$	9,821		$	964		$	97,340		$	—		$	108,125