Exhibit 99.1
Solo Cup Company and Subsidiaries
Consolidated Statements of Operations
(In millions)
Thirteen weeks ended | Twenty-six weeks ended | |||||||||||||||
June 27, 2010 | June 28, 2009 | June 27, 2010 | June 28, 2009 | |||||||||||||
Net sales | $ | 419.2 | $ | 395.8 | $ | 764.1 | $ | 745.5 | ||||||||
Cost of goods sold | 386.6 | 331.4 | 693.2 | 643.8 | ||||||||||||
Gross profit | 32.6 | 64.4 | 70.9 | 101.7 | ||||||||||||
Selling, general and administrative expenses | 40.8 | 38.3 | 75.6 | 74.1 | ||||||||||||
Loss on asset disposals | 1.0 | 0.2 | 2.0 | 2.4 | ||||||||||||
Asset impairment | 13.2 | — | 13.2 | — | ||||||||||||
Operating (loss) income | (22.4 | ) | 25.9 | (19.9 | ) | 25.2 | ||||||||||
Interest expense, net of interest income | 17.4 | 13.3 | 34.4 | 27.9 | ||||||||||||
Reclassification of unrealized loss on cash flow hedges to interest expense | — | 9.1 | — | 9.1 | ||||||||||||
Foreign currency exchange (gain) loss , net | — | (3.3 | ) | 1.4 | (2.4 | ) | ||||||||||
Gain from bargain purchase | (1.7 | ) | — | (1.7 | ) | — | ||||||||||
(Loss) income before income taxes | (38.1 | ) | 6.8 | (54.0 | ) | (9.4 | ) | |||||||||
Income tax provision (benefit) | 1.7 | (0.1 | ) | 2.2 | (6.2 | ) | ||||||||||
Net (loss) income | $ | (39.8 | ) | $ | 6.9 | $ | (56.2 | ) | $ | (3.2 | ) | |||||
Reconciliation of net (loss) income to EBITDA (non-GAAP measure) | ||||||||||||||||
Thirteen weeks ended | Twenty-six weeks ended | |||||||||||||||
June 27, 2010 | June 28, 2009 | June 27, 2010 | June 28, 2009 | |||||||||||||
Net (loss) income(1) | $ | (39.8 | ) | $ | 6.9 | $ | (56.2 | ) | $ | (3.2 | ) | |||||
Interest expense, net (includes reclassification of unrealized loss on cash flow hedges) | 17.4 | 22.4 | 34.4 | 37.0 | ||||||||||||
Income tax provision (benefit) | 1.7 | (0.1 | ) | 2.2 | (6.2 | ) | ||||||||||
Depreciation and amortization | 29.7 | 16.6 | 46.7 | 34.5 | ||||||||||||
EBITDA (non-GAAP measure) | $ | 9.0 | $ | 45.8 | $ | 27.1 | $ | 62.1 | ||||||||
(1) Net (loss) income includes the following items, which are listed here to provide information for purposes of additional analysis. |
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Thirteen weeks ended | Twenty-six weeks ended | |||||||||||||||
June 27, 2010 | June 28, 2009 | June 27, 2010 | June 28, 2009 | |||||||||||||
Plant closure expenses and severance costs | $ | 6.5 | $ | 3.1 | $ | 6.5 | $ | 7.5 | ||||||||
Closed plant inefficiencies | — | 0.2 | — | 1.0 | ||||||||||||
Gain from bargain purchase | (1.7 | ) | — | (1.7 | ) | — | ||||||||||
Asset impairment | 13.2 | — | 13.2 | — | ||||||||||||
Loss on asset disposals | 1.0 | 0.2 | 2.0 | 2.4 | ||||||||||||
Foreign currency exchange (gain) loss , net | — | (3.3 | ) | 1.4 | (2.4 | ) | ||||||||||
Long-term incentive plan | 0.2 | 0.3 | — | 0.5 | ||||||||||||
Contractual resolution charge | — | — | — | 3.9 |
Solo Cup Company and Subsidiaries
Condensed Consolidated Balance Sheets
(In millions)
June 27, 2010 | December 27, 2009 | ||||||
Assets | |||||||
Cash and cash equivalents | $ | 22.0 | $ | 30.0 | |||
Accounts receivable, net | 134.5 | 124.9 | |||||
Inventories | 308.7 | 232.6 | |||||
Deferred income taxes | 18.4 | 19.1 | |||||
Other current assets | 31.6 | 29.8 | |||||
Total current assets | 515.2 | 436.4 | |||||
Property, plant and equipment, net | 495.7 | 509.0 | |||||
Other assets | 29.5 | 42.0 | |||||
Total assets | $ | 1,040.4 | $ | 987.4 | |||
Liabilities and Shareholder’s (Deficit) Equity | |||||||
Accounts payable | $ | 85.7 | $ | 82.0 | |||
Accrued expenses | 52.7 | 55.6 | |||||
Current maturities of long-term debt | 0.5 | 0.8 | |||||
Other current liabilities | 61.1 | 47.1 | |||||
Total current liabilities | 200.0 | 185.5 | |||||
Long-term debt, net of current maturities | 739.2 | 635.3 | |||||
Deferred income taxes | 21.7 | 22.7 | |||||
Other liabilities | 117.3 | 125.7 | |||||
Total liabilities | 1,078.2 | 969.2 | |||||
Total shareholder’s (deficit) equity | (37.8 | ) | 18.2 | ||||
Total liabilities and shareholder’s (deficit) equity | $ | 1,040.4 | $ | 987.4 | |||
Solo Cup Company and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In millions)
Twenty-six weeks ended | ||||||||
June 27, 2010 | June 28, 2009 | |||||||
Cash flows from operating activities | ||||||||
Net loss | $ | (56.2 | ) | $ | (3.2 | ) | ||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||||||||
Depreciation and amortization | 46.7 | 34.5 | ||||||
Deferred financing fee amortization | 3.4 | 2.8 | ||||||
Loss on asset disposals | 2.0 | 2.4 | ||||||
Gain from bargain purchase | (1.7 | ) | — | |||||
Reclassification of unrealized loss on cash flow hedges | — | 9.1 | ||||||
Asset impairment | 13.2 | — | ||||||
Deferred income taxes | (0.1 | ) | (3.6 | ) | ||||
Foreign currency exchange loss (gain), net | 1.4 | (2.5 | ) | |||||
Changes in operating assets and liabilities, net of business acquisition | (66.6 | ) | 44.4 | |||||
Other, net | 1.2 | 1.3 | ||||||
Net cash (used in) provided by operating activities | (56.7 | ) | 85.2 | |||||
Cash flows from investing activities | ||||||||
Purchase of property, plant and equipment | (31.3 | ) | (29.3 | ) | ||||
Proceeds from sale of property, plant and equipment | 0.1 | 0.1 | ||||||
Business acquisition, net of cash acquired | (23.7 | ) | — | |||||
Decrease in restricted cash | 4.3 | — | ||||||
Net cash used in investing activities | (50.6 | ) | (29.2 | ) | ||||
Cash flows from financing activities | ||||||||
Net borrowings under revolving credit facilities | 100.2 | 19.0 | ||||||
Repayments of term notes | (0.4 | ) | (105.5 | ) | ||||
Repayments of other debt | (0.2 | ) | (0.2 | ) | ||||
Return of capital to parent | (0.1 | ) | — | |||||
Debt issuance costs | (0.5 | ) | — | |||||
Net cash provided by (used in) financing activities | 99.0 | (86.7 | ) | |||||
Effect of exchange rate changes on cash | 0.3 | 0.1 | ||||||
Net decrease in cash and cash equivalents | (8.0 | ) | (30.6 | ) | ||||
Cash and cash equivalents, beginning of period | 30.0 | 57.5 | ||||||
Cash and cash equivalents, end of period | $ | 22.0 | $ | 26.9 | ||||