Exhibit 99.2
Owens Corning and Subsidiaries
Consolidated Statement of Income (Loss)
(Unaudited)
(Dollars in millions)
Combined | Successor | Predecessor | ||||||||||||||
Two Months Ended December 31, 2006 | Ten Months Ended October 31, 2006 | Twelve Months Ended December 31, 2005 | ||||||||||||||
NET SALES | $ | 6,461 | $ | 909 | $ | 5,552 | $ | 6,323 | ||||||||
COST OF SALES | 5,395 | 799 | 4,596 | 5,165 | ||||||||||||
Gross margin | 1,066 | 110 | 956 | 1,158 | ||||||||||||
Operating Expenses | ||||||||||||||||
Marketing and administrative expenses | 537 | 92 | 445 | 565 | ||||||||||||
Science and technology expenses | 80 | 30 | 50 | 58 | ||||||||||||
Restructure costs | 39 | 27 | 12 | — | ||||||||||||
Chapter 11 related reorganization items | 55 | 10 | 45 | 45 | ||||||||||||
Provision for asbestos litigation claims - Owens Corning | — | — | — | 3,365 | ||||||||||||
Provision (credit) for asbestos litigation claims - Fibreboard | (13 | ) | — | (13 | ) | 902 | ||||||||||
Employee emergence equity program | 6 | 6 | — | — | ||||||||||||
(Gain) loss on sale of fixed assets and other | (71 | ) | 5 | (76 | ) | (34 | ) | |||||||||
Total operating expenses | 633 | 170 | 463 | 4,901 | ||||||||||||
INCOME (LOSS) FROM OPERATIONS | 433 | (60 | ) | 493 | (3,743 | ) | ||||||||||
Interest expense, net | 270 | 29 | 241 | 739 | ||||||||||||
Gain on settlement of liabilities subject to compromise | (5,864 | ) | — | (5,864 | ) | — | ||||||||||
Fresh-start accounting adjustments | (3,049 | ) | — | (3,049 | ) | — | ||||||||||
INCOME (LOSS) BEFORE INCOME TAX EXPENSE | 9,076 | (89 | ) | 9,165 | (4,482 | ) | ||||||||||
Income tax expense (benefit) | 997 | (28 | ) | 1,025 | (387 | ) | ||||||||||
INCOME (LOSS) BEFORE MINORITY INTEREST AND EQUITY IN NET EARNINGS OF AFFILIATES | 8,079 | (61 | ) | 8,140 | (4,095 | ) | ||||||||||
Minority interest and equity in net earnings (loss) of affiliates | (4 | ) | (4 | ) | — | (4 | ) | |||||||||
NET INCOME (LOSS) | $ | 8,075 | $ | (65 | ) | $ | 8,140 | $ | (4,099 | ) | ||||||
RECONCILIATION TO ADJUSTED INCOME FROM OPERATIONS: | ||||||||||||||||
NET INCOME (LOSS) | $ | 8,075 | $ | (65 | ) | $ | 8,140 | $ | (4,099 | ) | ||||||
Minority interest and equity in net earnings (loss) of affiliates | (4 | ) | (4 | ) | — | (4 | ) | |||||||||
INCOME (LOSS) BEFORE MINORITY INTEREST AND EQUITY IN NET EARNINGS OF AFFILIATES | 8,079 | (61 | ) | 8,140 | (4,095 | ) | ||||||||||
Income tax expense (benefit) | 997 | (28 | ) | 1,025 | (387 | ) | ||||||||||
INCOME (LOSS) BEFORE INCOME TAX EXPENSE | 9,076 | (89 | ) | 9,165 | (4,482 | ) | ||||||||||
Gain on settlement of liabilities subject to compromise | (5,864 | ) | — | (5,864 | ) | — | ||||||||||
Fresh-start accounting adjustments | (3,049 | ) | — | (3,049 | ) | — | ||||||||||
Interest expense, net | 270 | 29 | 241 | 739 | ||||||||||||
INCOME (LOSS) FROM OPERATIONS | 433 | (60 | ) | 493 | (3,743 | ) | ||||||||||
Adjustments to remove items impacting comparability: | ||||||||||||||||
Provison for asbestos litigation | (13 | ) | — | (13 | ) | 4,267 | ||||||||||
Chapter 11 related reorganization items | 55 | 10 | 45 | 45 | ||||||||||||
Impact of inventory write-up | 44 | 44 | — | — | ||||||||||||
In-process research and development | 21 | 21 | — | — | ||||||||||||
Restructuring activities | 55 | 44 | 11 | — | ||||||||||||
Gain on sale of metals | (45 | ) | — | (45 | ) | (7 | ) | |||||||||
Other | 19 | 12 | 7 | (18 | ) | |||||||||||
Total adjustments to remove items impacting comparability | 136 | 131 | 5 | 4,287 | ||||||||||||
ADJUSTED INCOME FROM OPERATIONS | $ | 569 | $ | 71 | $ | 498 | $ | 544 | ||||||||
DEPRECIATION AND AMORTIZATION | $ | 278 | $ | 69 | $ | 209 | $ | 234 |
Owens Corning and Subsidiaries
Consolidated Statement of Income (Loss)
(Unaudited)
(Dollars in millions)
Combined | Successor | Predecessor | ||||||||||||||
Two Months Ended December 31, 2006 | One Month Ended October 31, 2006 | Three Months Ended December 31, 2005 | ||||||||||||||
NET SALES | $ | 1,477 | $ | 909 | $ | 568 | $ | 1,713 | ||||||||
COST OF SALES | 1,269 | 799 | 470 | 1,405 | ||||||||||||
Gross margin | 208 | 110 | 98 | 308 | ||||||||||||
Operating Expenses | ||||||||||||||||
Marketing and administrative expenses | 125 | 92 | 33 | 156 | ||||||||||||
Science and technology expenses | 35 | 30 | 5 | 15 | ||||||||||||
Restructure costs | 29 | 27 | 2 | — | ||||||||||||
Chapter 11 related reorganization items | 27 | 10 | 17 | 5 | ||||||||||||
Provision (credit) for asbestos litigation claims - Owens Corning | — | — | — | (69 | ) | |||||||||||
Provision (credit) for asbestos litigation claims -Fibreboard | — | — | — | (5 | ) | |||||||||||
Employee emergence equity program | 6 | 6 | — | — | ||||||||||||
(Gain) loss on sale of fixed assets and other | (5 | ) | 5 | (10 | ) | (24 | ) | |||||||||
Total operating expenses | 217 | 170 | 47 | 78 | ||||||||||||
INCOME (LOSS) FROM OPERATIONS | (9 | ) | (60 | ) | 51 | 230 | ||||||||||
Interest expense, net | 48 | 29 | 19 | 199 | ||||||||||||
Gain on settlement of liabilities subject to compromise | (5,864 | ) | — | (5,864 | ) | — | ||||||||||
Fresh-start accounting adjustments | (3,049 | ) | — | (3,049 | ) | — | ||||||||||
INCOME (LOSS) BEFORE INCOME TAX EXPENSE | 8,856 | (89 | ) | 8,945 | 31 | |||||||||||
Income tax expense (benefit) | 1,151 | (28 | ) | 1,179 | (304 | ) | ||||||||||
INCOME (LOSS) BEFORE MINORITY INTEREST AND EQUITY IN NET EARNINGS OF AFFILIATES | 7,705 | (61 | ) | 7,766 | 335 | |||||||||||
Minority interest and equity in net earnings (loss) of affiliates | (6 | ) | (4 | ) | (2 | ) | 3 | |||||||||
NET INCOME (LOSS) | $ | 7,699 | $ | (65 | ) | $ | 7,764 | $ | 338 | |||||||
RECONCILIATION TO ADJUSTED INCOME FROM OPERATIONS: | ||||||||||||||||
NET INCOME (LOSS) | $ | 7,699 | $ | (65 | ) | $ | 7,764 | $ | 338 | |||||||
Minority interest and equity in net earnings (loss) of affiliates | (6 | ) | (4 | ) | (2 | ) | 3 | |||||||||
INCOME (LOSS) BEFORE MINORITY INTEREST AND EQUITY IN NET EARNINGS OF AFFILIATES | 7,705 | (61 | ) | 7,766 | 335 | |||||||||||
Income tax expense (benefit) | 1,151 | (28 | ) | 1,179 | (304 | ) | ||||||||||
INCOME (LOSS) BEFORE INCOME TAX EXPENSE | 8,856 | (89 | ) | 8,945 | 31 | |||||||||||
Gain on settlement of liabilities subject to compromise | (5,864 | ) | — | (5,864 | ) | — | ||||||||||
Fresh-start accounting adjustments | (3,049 | ) | — | (3,049 | ) | — | ||||||||||
Interest expense, net | 48 | 29 | 19 | 199 | ||||||||||||
INCOME (LOSS) FROM OPERATIONS | (9 | ) | (60 | ) | 51 | 230 | ||||||||||
Adjustments to remove items impacting comparability: | ||||||||||||||||
Provison for asbestos litigation | — | — | — | (74 | ) | |||||||||||
Chapter 11 related reorganization items | 27 | 10 | 17 | 5 | ||||||||||||
Impact of inventory write-up | 44 | 44 | — | — | ||||||||||||
In-process research and development | 21 | 21 | — | — | ||||||||||||
Restructuring activities | 45 | 44 | 1 | — | ||||||||||||
Gain on sale of metals | — | — | — | (7 | ) | |||||||||||
Other | 15 | 12 | 3 | (5 | ) | |||||||||||
Total adjustments to remove items impacting comparability | 152 | 131 | 21 | (81 | ) | |||||||||||
ADJUSTED INCOME FROM OPERATIONS | $ | 143 | $ | 71 | $ | 72 | $ | 149 | ||||||||
DEPRECIATION AND AMORTIZATION | $ | 94 | $ | 69 | $ | 25 | $ | 53 |
Owens Corning and Subsidiaries
Condensed Consolidated Balance Sheet
(Unaudited)
(Dollars in millions)
Successor | Predecessor | ||||||
December 31, 2006 | December 31, 2005 | ||||||
ASSETS | |||||||
Current | |||||||
Cash and cash equivalents | $ | 1,089 | $ | 1,559 | |||
Receivables, net | 573 | 608 | |||||
Inventories | 749 | 477 | |||||
Other current assets | 141 | 61 | |||||
Total current | 2,552 | 2,705 | |||||
Other | |||||||
Restricted cash | — | 1,622 | |||||
Deferred income taxes | 549 | 1,432 | |||||
Goodwill and other intangible assets | 2,611 | 226 | |||||
Other noncurrent assets | 237 | 738 | |||||
Total other | 3,397 | 4,018 | |||||
Net plant and equipment | 2,521 | 2,012 | |||||
TOTAL ASSETS | $ | 8,470 | $ | 8,735 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | |||||||
Current | |||||||
Accounts payable and accrued liabilities | $ | 1,081 | $ | 1,026 | |||
Accrued interest | 39 | 741 | |||||
Short-term debt and current portion of long-term debt | 1,440 | 19 | |||||
Total current | 2,560 | 1,786 | |||||
Long-term debt | 1,296 | 36 | |||||
Other long-term liabilities | 884 | 1,293 | |||||
Liabilities subject to compromise | — | 13,520 | |||||
Company obligated securities of entities holding solely parent debentures - subject to compromise | — | 200 | |||||
Minority interest | 44 | 47 | |||||
Stockholders’ equity (deficit) | 3,686 | (8,147 | ) | ||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | $ | 8,470 | $ | 8,735 | |||
Owens Corning and Subsidiaries
Condensed Consolidated Statement of Cash Flows
(Unaudited)
(Dollars in millions)
Combined Twelve Months Ended December 31, 2006 | Successor | Predecessor | ||||||||||||||
Two Months Ended December 31, 2006 | Ten Months Ended October 31, 2006 | Twelve Months Ended December 31, 2005 | ||||||||||||||
NET CASH FLOW FROM OPERATIONS | ||||||||||||||||
Net income (loss) | $ | 8,075 | $ | (65 | ) | $ | 8,140 | $ | (4,099 | ) | ||||||
Adjustments to reconcile net income (loss) to cash provided by operating activities | ||||||||||||||||
Provision for asbestos litigation claims | 21 | — | 21 | 4,277 | ||||||||||||
Depreciation and amortization | 278 | 69 | 209 | 234 | ||||||||||||
Change in deferred taxes | 160 | (48 | ) | 208 | (467 | ) | ||||||||||
Provision for (payment of) post-petition interest/fees on pre-petition obligations | (728 | ) | (31 | ) | (697 | ) | 735 | |||||||||
Fresh-start accounting adjustments, net of tax | (2,243 | ) | — | (2,243 | ) | — | ||||||||||
Gain on settlement of liabilities subject to compromise | (5,864 | ) | — | (5,864 | ) | — | ||||||||||
Payments related to Chapter 11 filings | (131 | ) | (131 | ) | — | — | ||||||||||
Payment to asbestos trust | (1,250 | ) | — | (1,250 | ) | — | ||||||||||
Changes in receivables, inventories, accounts payable and accrued liabilities | 24 | 312 | (288 | ) | 24 | |||||||||||
Other | (230 | ) | (91 | ) | (139 | ) | 42 | |||||||||
Net cash flow from operating activities | (1,888 | ) | 15 | (1,903 | ) | 746 | ||||||||||
NET CASH FLOW FROM INVESTING | ||||||||||||||||
Additions to plant and equipment | (361 | ) | (77 | ) | (284 | ) | (288 | ) | ||||||||
Investment in subsidiaries, net of cash acquired | (47 | ) | — | (47 | ) | (14 | ) | |||||||||
Proceeds from the sale of assets or affiliate | 82 | — | 82 | 19 | ||||||||||||
Net cash flow from investing activities | (326 | ) | (77 | ) | (249 | ) | (283 | ) | ||||||||
NET CASH FLOW FROM FINANCING | ||||||||||||||||
Proceeds from issuance of bonds | 1,178 | — | 1,178 | — | ||||||||||||
Proceeds from issuance of new common stock | 2,187 | — | 2,187 | — | ||||||||||||
Payments to pre-petition lenders | (1,516 | ) | (55 | ) | (1,461 | ) | — | |||||||||
Other cash used for financing activities | (111 | ) | 1 | (112 | ) | (30 | ) | |||||||||
Net cash flow from financing activities | 1,738 | (54 | ) | 1,792 | (30 | ) | ||||||||||
Effect of exchange rate changes on cash | 6 | — | 6 | 1 | ||||||||||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (470 | ) | (116 | ) | (354 | ) | 434 | |||||||||
Cash and cash equivalents at beginning of period | 1,559 | 1,205 | 1,559 | 1,125 | ||||||||||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 1,089 | $ | 1,089 | $ | 1,205 | $ | 1,559 | ||||||||
Owens Corning and Subsidiaries
Business Segment Information
(Unaudited)
(Dollars in millions)
Combined Twelve Months Ended December 31, 2006 | Successor | Predecessor | ||||||||||||||
Two Months Ended December 31, 2006 | Ten Months Ended October 31, 2006 | Twelve Months Ended December 31, 2005 | ||||||||||||||
NET SALES | ||||||||||||||||
Insulating Systems | $ | 2,097 | $ | 331 | $ | 1,766 | $ | 1,976 | ||||||||
Roofing and Asphalt | 1,723 | 167 | 1,556 | 1,806 | ||||||||||||
Other Building Materials and Services | 1,260 | 178 | 1,082 | 1,234 | ||||||||||||
Composite Solutions | 1,560 | 245 | 1,315 | 1,495 | ||||||||||||
Total reportable segments | 6,640 | 921 | 5,719 | 6,511 | ||||||||||||
Corporate Eliminations | (179 | ) | (12 | ) | (167 | ) | (188 | ) | ||||||||
Consolidated | $ | 6,461 | $ | 909 | $ | 5,552 | $ | 6,323 | ||||||||
INCOME BEFORE INCOME TAX EXPENSE | ||||||||||||||||
Insulating Systems | $ | 467 | $ | 59 | $ | 408 | $ | 424 | ||||||||
Roofing and Asphalt | 72 | (23 | ) | 95 | 139 | |||||||||||
Other Building Materials and Services | 13 | (4 | ) | 17 | 17 | |||||||||||
Composite Solutions | 159 | 34 | 125 | 139 | ||||||||||||
Total reportable segments | $ | 711 | $ | 66 | $ | 645 | $ | 719 | ||||||||
RECONCILIATION TO INCOME (LOSS) BEFORE INCOME TAX EXPENSE | ||||||||||||||||
Chapter 11 related reorganization items | $ | (55 | ) | $ | (10 | ) | $ | (45 | ) | $ | (45 | ) | ||||
Credit (provisions) for asbestos litigation claims | 13 | — | 13 | (4,267 | ) | |||||||||||
Restructure costs and other (charges) credits | (68 | ) | (50 | ) | (18 | ) | 18 | |||||||||
Employee emergence equity program | (6 | ) | (6 | ) | — | — | ||||||||||
Impact of fresh-start accounting | (65 | ) | (65 | ) | — | — | ||||||||||
General corporate income (expense) | (97 | ) | 5 | (102 | ) | (168 | ) | |||||||||
Interest expense, net | (270 | ) | (29 | ) | (241 | ) | (739 | ) | ||||||||
Gain on settlement of liabilities subject to compromise | 5,864 | — | 5,864 | — | ||||||||||||
Fresh-start accounting adjustments | 3,049 | — | 3,049 | — | ||||||||||||
RECONCILIATION TO INCOME (LOSS) BEFORE INCOME TAX EXPENSE | $ | 9,076 | $ | (89 | ) | $ | 9,165 | $ | (4,482 | ) | ||||||
Owens Corning and Subsidiaries
Business Segment Information
(Unaudited)
(Dollars in millions)
Combined Three Months Ended December 31, 2006 | Successor | Predecessor | ||||||||||||||
Two Months Ended December 31, 2006 | One Month Ended October 31, 2006 | Three Months Ended December 31, 2005 | ||||||||||||||
NET SALES | ||||||||||||||||
Insulating Systems | $ | 527 | $ | 331 | $ | 196 | $ | 563 | ||||||||
Roofing and Asphalt | 304 | 167 | 137 | 492 | ||||||||||||
Other Building Materials and Services | 288 | 178 | 110 | 325 | ||||||||||||
Composite Solutions | 383 | 245 | 138 | 373 | ||||||||||||
Total reportable segments | 1,502 | 921 | 581 | 1,753 | ||||||||||||
Corporate Eliminations | (25 | ) | (12 | ) | (13 | ) | (40 | ) | ||||||||
Consolidated | $ | 1,477 | $ | 909 | $ | 568 | $ | 1,713 | ||||||||
INCOME BEFORE INCOME TAX EXPENSE | ||||||||||||||||
Insulating Systems | $ | 107 | $ | 59 | $ | 48 | $ | 128 | ||||||||
Roofing and Asphalt | (25 | ) | (23 | ) | (2 | ) | 34 | |||||||||
Other Building Materials and Services | — | (4 | ) | 4 | 5 | |||||||||||
Composite Solutions | 49 | 34 | 15 | 45 | ||||||||||||
Total reportable segments | $ | 131 | $ | 66 | $ | 65 | $ | 212 | ||||||||
RECONCILIATION TO INCOME (LOSS) BEFORE INCOME TAX EXPENSE | ||||||||||||||||
Chapter 11 related reorganization items | $ | (27 | ) | $ | (10 | ) | $ | (17 | ) | $ | (5 | ) | ||||
Credit (provisions) for asbestos litigation claims | — | — | — | 74 | ||||||||||||
Restructure costs and other (charges) credits | (54 | ) | (50 | ) | (4 | ) | 5 | |||||||||
Employee emergence equity program | (6 | ) | (6 | ) | — | — | ||||||||||
Impact of fresh-start accounting | (65 | ) | (65 | ) | — | — | ||||||||||
General corporate expense | 12 | 5 | 7 | (56 | ) | |||||||||||
Interest expense, net | (48 | ) | (29 | ) | (19 | ) | (199 | ) | ||||||||
Gain on settlement of liabilities subject to compromise | 5,864 | — | 5,864 | — | ||||||||||||
Fresh-start accounting adjustments | 3,049 | — | 3,049 | — | ||||||||||||
RECONCILIATION TO INCOME (LOSS) BEFORE INCOME TAX EXPENSE | $ | 8,856 | $ | (89 | ) | $ | 8,945 | $ | 31 | |||||||