Exhibit 99.2
Following are the unaudited pro forma consolidated statements of operations of Remy International, Inc. for the nine months ended September 30, 2006 and the years ended December 31, 2005, December 31, 2004 and December 31, 2003 and the unaudited pro forma consolidated balance sheet of Remy International, Inc. at September 30, 2006. The unaudited pro forma consolidated statements of operations give effect to the disposition of Franklin Power Products, Inc. and International Fuel Systems, Inc. and the discontinuation of Powerbilt Products, Inc. as if they had occurred on January 1, 2003. The unaudited pro forma balance sheet gives effect to these actions as if they had occurred on September 30, 2006.
The unaudited pro forma consolidated statements of operations and balance sheet were derived by adjusting the historical financial statements of Remy International, Inc. The adjustments are based on currently available information and, therefore, the actual adjustments may differ from the pro forma adjustments. However, management believes that the assumptions provide a reasonable basis for presenting the significant effects of the disposition of Franklin Power Products, Inc. and International Fuel Systems, Inc. and the discontinuation of Powerbilt Products, Inc. The pro forma adjustments give appropriate effect to those assumptions and are properly applied in the unaudited pro forma consolidated statements of operations and unaudited pro forma consolidated balance sheet.
The unaudited pro forma consolidated financial statements should be read in conjunction with the notes thereto and Remy International, Inc.’s audited financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2005 and the unaudited financial statements included on Form 10-Q for the period ended September 30, 2006.
Unaudited Pro Forma Condensed Consolidated Statement of Operations
| | | | | | | | | | | | |
| | | | | | Pro Forma Adjustments | |
| | | |
| IN THOUSANDS, For the nine months ended September 30, 2006 | | Historical | | | Discontinued
Businesses (a) | | | Pro Forma | |
| | | |
Net sales | | $ | 1,078,506 | | | $ | (128,751 | ) | | $ | 949,755 | |
Cost of goods sold | | | 948,579 | | | | (109,175 | ) | | | 839,404 | |
Gross profit / loss | | | 129,927 | | | | (19,576 | ) | | | 110,351 | |
| | | |
Selling, general and administrative expenses | | | 97,924 | | | | 247 | (b) | | | 98,171 | |
Restructuring charges | | | 6,405 | | | | — | | | | 6,405 | |
Operating income / loss | | | 25,598 | | | | (19,823 | ) | | | 5,775 | |
| | | |
Interest expense, net | | | 62,869 | | | | (8,474 | ) | | | 54,395 | |
Income / loss from continuing operations before income taxes, minority
interest and loss from unconsolidated joint ventures | | | (37,271 | ) | | | (11,349 | ) | | | (48,620 | ) |
| | | |
Income tax expense / benefit | | | 4,352 | | | | (55 | ) | | | 4,297 | |
Minority interest | | | 3,850 | | | | (3,536 | ) | | | 314 | |
Loss from unconsolidated subsidiaries | | | 3,641 | | | | — | | | | 3,641 | |
| | | |
Net loss from continuing operations | | $ | (49,114 | ) | | $ | (7,758 | ) | | $ | (56,872 | ) |
| | (a) | Represents the combined historical statements of operations of Franklin Power Products, Inc., International Fuel Systems, Inc. and the discontinued operations of Powerbilt Products, Inc. Revenue of Powerbilt was $15 with an operating loss of $(109). |
| | (b) | Includes other income of $656. |
Unaudited Pro Forma Condensed Consolidated Statement of Operations
| | | | | | | | | | | | |
| | | | | | Pro Forma Adjustments | |
| | | |
| IN THOUSANDS, For the year ended December 31, 2005 | | Historical | | | Discontinued
Businesses (a) | | | Pro Forma | |
| | | |
Net sales | | $ | 1,228,950 | | | $ | (113,645 | ) | | $ | 1,115,305 | |
Cost of goods sold | | | 1,081,743 | | | | (100,356 | ) | | | 981,387 | |
Gross profit / loss | | | 147,207 | | | | (13,289 | ) | | | 133,918 | |
| | | |
Selling, general and administrative expenses | | | 139,189 | | | | (224 | ) (b) | | | 138,965 | |
Impairment charges | | | 13,917 | | | | — | | | | 13,917 | |
Restructuring charges | | | 4,850 | | | | (378 | ) | | | 4,472 | |
Operating income / loss | | | (10,749 | ) | | | (12,687 | ) | | | (23,436 | ) |
| | | |
Interest expense, net | | | 69,409 | | | | (7,804 | ) | | | 61,605 | |
| | | |
Loss from continuing operations before income taxes, minority interest and loss from unconsolidated joint ventures | | | (80,158 | ) | | | (4,883 | ) | | | (85,041 | ) |
| | | |
Income tax expense / benefit | | | 13,187 | | | | (33 | ) | | | 13,154 | |
Minority interest | | | 3,442 | | | | (3,015 | ) | | | 427 | |
Loss from unconsolidated subsidiaries | | | (208 | ) | | | — | | | | (208 | ) |
| | | |
Net loss from continuing operations | | $ | (96,579 | ) | | $ | (1,835 | ) | | $ | (98,414 | ) |
| | (a) | Represents the combined historical statements of operations of Franklin Power Products, Inc., International Fuel Systems, Inc. and the discontinued operations of Powerbilt Products, Inc. Revenue of Powerbilt was $2,854 with an operating loss of $(2,170). |
| | (b) | Includes other income of $336. |
Unaudited Pro Forma Condensed Consolidated Statement of Operations
| | | | | | | | | | |
| | | | | Pro Forma Adjustments |
| | | |
| IN THOUSANDS, For the year ended December 31, 2004 | | Historical | | Discontinued
Businesses (a) | | | Pro Forma |
| | | |
Net sales | | $ | 1,051,165 | | $ | (78,742 | ) | | $ | 972,423 |
Cost of goods sold | | | 850,672 | | | (65,737 | ) | | | 784,935 |
Gross profit / loss | | | 200,493 | | | (13,005 | ) | | | 187,488 |
| | | |
Selling, general and administrative expenses | | | 113,263 | | | 236 | (b) | | | 113,499 |
Impairment charges | | | — | | | — | | | | — |
Restructuring charges | | | 942 | | | 64 | | | | 1,006 |
Operating income / loss | | | 86,288 | | | (13,305 | ) | | | 72,983 |
| | | |
Interest expense, net | | | 58,237 | | | (7,023 | ) | | | 51,214 |
Loss on early extinguishment of debt | | | 7,939 | | | — | | | | 7,939 |
Loss from continuing operations before income taxes, minority interest and loss from unconsolidated joint ventures | | | 20,112 | | | (6,282 | ) | | | 13,830 |
| | | |
Income tax expense / benefit | | | 5,367 | | | (78 | ) | | | 5,289 |
Minority interest | | | 2,798 | | | (2,073 | ) | | | 725 |
Loss from unconsolidated subsidiaries | | | 588 | | | — | | | | 588 |
Net income / loss from continuing operations | | $ | 11,359 | | $ | (4,131 | ) | | $ | 7,228 |
| | (a) | Represents the combined historical statements of operations of Franklin Power Products, Inc., International Fuel Systems, Inc. and the discontinued operations of Powerbilt Products, Inc. Revenue of Powerbilt was $2,784 with an operating loss of $(695). |
| | (b) | Includes other income of $536. |
Unaudited Pro Forma Condensed Consolidated Statement of Operations
| | | | | | | | | | | | |
| | | | | | Pro Forma Adjustments | |
| | | |
| IN THOUSANDS, For the year ended December 31, 2003 | | Historical | | | Discontinued
Businesses (a) | | | Pro Forma | |
| | | |
Net sales | | $ | 972,794 | | | $ | (63,721 | ) | | | 909,073 | |
Cost of goods sold | | | 909,562 | | | | (70,430 | ) | | | 839,132 | |
Gross profit / loss | | | 63,232 | | | | 6,709 | | | | 69,941 | |
| | | |
Selling, general and administrative expenses | | | 96,770 | | | | (279 | ) (b) | | | 96,491 | |
Impairment charges | | | — | | | | — | | | | — | |
Restructuring charges | | | 48,968 | | | | (187 | ) | | | 48,781 | |
Operating income / loss | | | (82,506 | ) | | | 7,175 | | | | (75,331 | ) |
| | | |
Interest expense, net | | | 55,454 | | | | (5,618 | ) | | | 49,836 | |
| | | |
Loss from continuing operations before income taxes, minority interest and loss from unconsolidated joint ventures | | | (137,960 | ) | | | 12,793 | | | | (125,167 | ) |
| | | |
Income tax expense / benefit | | | 36,682 | | | | (34 | ) | | | 36,648 | |
Minority interest | | | (143 | ) | | | 1,888 | | | | 1,745 | |
Loss from unconsolidated subsidiaries | | | 6,427 | | | | — | | | | 6,427 | |
| | | |
Net loss from continuing operations | | $ | (180,926 | ) | | $ | 10,939 | | | $ | (169,987 | ) |
| | (a) | Represents the combined historical statements of operations of Franklin Power Products, Inc., International Fuel Systems, Inc. and the discontinued operations of Powerbilt Products, Inc. Revenue of Powerbilt was $2,144 with an operating loss of $(661). |
| | (b) | Includes other income of $331. |
Unaudited Pro Forma Condensed Consolidated Balance Sheet
| | | | | | | | | | | | |
| | | | | | Pro Forma Adjustments | |
| | | |
| IN THOUSANDS, At September 30, 2006 | | Historical | | | Discontinued
Businesses (a) | | | Pro Forma | |
Assets: | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | |
Cash and cash equivalents | | $ | 27,154 | | | $ | 93,242 | | | $ | 120,396 | |
Trade accounts receivable, net | | | 201,851 | | | | (28,019 | ) | | | 173,832 | |
Other receivables | | | 24,379 | | | | — | | | | 24,379 | |
Inventories | | | 280,109 | | | | (40,949 | ) | | | 239,160 | |
Deferred income taxes | | | 1,793 | | | | — | | | | 1,793 | |
Assets of discontinued operations | | | 4 | | | | — | | | | 4 | |
Other current assets | | | 9,610 | | | | — | | | | 9,610 | |
Total current assets | | | 544,900 | | | | 24,274 | | | | 569,174 | |
| | | |
Restricted cash | | | — | | | | 50,000 | | | | 50,000 | |
Property, plant and equipment, net | | | 171,137 | | | | (15,546 | ) | | | 155,591 | |
Deferred financing costs, net | | | 10,762 | | | | 1,222 | | | | 11,984 | |
Goodwill, net | | | 156,650 | | | | (14,030 | ) | | | 142,620 | |
Investments in unconsolidated subsidiaries | | | 2,274 | | | | — | | | | 2,274 | |
Other assets | | | 34,013 | | | | (262 | ) | | | 33,751 | |
| | | |
Total assets | | $ | 919,736 | | | $ | 45,658 | | | $ | 965,394 | |
| | | | | | | | | | | | |
| | | |
Liabilities and Stockholders’ Deficit: | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | |
Accounts payable | | $ | 231,531 | | | $ | (30,878 | ) | | $ | 200,654 | |
Accrued interest | | | 21,244 | | | | — | | | | 21,244 | |
Accrued restructuring | | | 5,955 | | | | (96 | ) | | | 5,859 | |
Liabilities of discontinued operations | | | 239 | | | | 1,526 | | | | 1,765 | |
Other liabilities and accrued expenses | | | 149,699 | | | | (9,691 | ) | | | 140,008 | |
Current maturities of long-term debt | | | 28,335 | | | | — | | | | 28,335 | |
Total current liabilities | | | 437,003 | | | | (39,138 | ) | | | 397,865 | |
| | | |
Long-term debt, net of current portion | | | 723,729 | | | | — | | | | 723,729 | |
| | | |
Post retirement benefits other than pensions | | | 16,408 | | | | — | | | | 16,408 | |
Accrued pension benefits | | | 14,746 | | | | — | | | | 14,746 | |
Accrued restructuring | | | 1,054 | | | | — | | | | 1,054 | |
Deferred income taxes | | | 11,731 | | | | — | | | | 11,731 | |
Other non-current liabilities | | | 46,456 | | | | (4,427 | ) | | | 42,029 | |
Minority interest | | | 14,521 | | | | (6,786 | ) | | | 7,735 | |
Redeemable preferred stock | | | — | | | | — | | | | — | |
| | | |
Common stock: | | | | | | | | | | | | |
Class B Shares | | | 3 | | | | — | | | | 3 | |
Paid -in capital | | | 334,336 | | | | — | | | | 334,336 | |
Retained deficit | | | (676,956 | ) | | | 96,009 | | | | (580,947 | ) |
Accumulated other comprehensive loss | | | (3,295 | ) | | | — | | | | (3,295 | ) |
Total stockholders’ deficit | | | (345,912 | ) | | | 96,009 | | | | (249,903 | ) |
| | | |
Total liabilities and stockholders’ deficit | | $ | 919,736 | | | $ | 45,658 | | | $ | 965,394 | |
| | (a) | Represents the combined historical balance sheets of Franklin Power Products, Inc., International Fuel Systems, Inc., Powerbilt Products, Inc. and related consolidations including net proceeds and estimated net gain on the sale of the businesses. Estimated net gain was calculated as if the transaction occurred on September 30, 2006 and includes the effect of entering into an amendment relating to the Senior Revolving Credit and Term Loan Facility. |
