EXHIBIT 99.1
ARAMARK CORPORATION AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
(Unaudited)
(In thousands)
Although ARAMARK Corporation continued as the same legal entity after the going-private transaction (the “Transaction”), the consolidated statements of operations are presented for two periods: Predecessor and Successor, which relate to the period preceding the Transaction and the period succeeding the Transaction, respectively. The Company refers to the operations of ARAMARK Corporation and subsidiaries for both the Predecessor and Successor periods. We have prepared our supplementary discussion of the results of operations for the three and six months ended March 28, 2008 by comparing them to the mathematical combination of the Successor and Predecessor periods in the three and six months ended March 30, 2007. Although this presentation does not comply with U.S. generally accepted accounting principles (GAAP), we believe that it provides a meaningful method of comparison. The combined operating results have not been prepared as pro forma results under applicable regulations and may not reflect the actual results we would have achieved absent the Transaction and may not be predictive of future results of operations.
ADJUSTED SALES GROWTH
Management believes that presentation of sales growth, adjusted to eliminate the effects of acquisitions, divestitures and the impact of foreign currency translation, provides useful information to investors because it enhances comparability between the current year and prior year reporting periods. Elimination of the currency translation effect provides constant currency comparisons without the distortion of currency rate fluctuations.
| Three Months Ended | % Change | ||||||||||
| March 28, 2008 | March 30, 2007 | ||||||||||
ARAMARK Corporation Consolidated Sales (as reported) | $ | 3,173,177 | $ | 2,980,942 | 6 | % | |||||
Effect of Currency Translation | — | 73,217 | |||||||||
Effect of Acquisitions | (8,692 | ) | (1,144 | ) | |||||||
ARAMARK Corporation Consolidated Sales (as adjusted) | $ | 3,164,485 | $ | 3,053,015 | 4 | % | |||||
| Six Months Ended | % Change | ||||||||||
| March 28, 2008 | March 30, 2007 | ||||||||||
ARAMARK Corporation Consolidated Sales (as reported) | $ | 6,523,797 | $ | 6,091,488 | 7 | % | |||||
Effect of Currency Translation | — | 147,374 | |||||||||
Effect of Acquisitions and Divestitures | (20,452 | ) | (5,520 | ) | |||||||
ARAMARK Corporation Consolidated Sales (as adjusted) | $ | 6,503,345 | $ | 6,233,342 | 4 | % | |||||
| Three Months Ended | % Change | ||||||||||
| March 28, 2008 | March 30, 2007 | ||||||||||
Food and Support Services—International Sales (as reported) | $ | 661,314 | $ | 543,416 | 22 | % | |||||
Effect of Currency Translation | — | 47,939 | |||||||||
Effect of Acquisitions and Divestitures | (3,509 | ) | — | ||||||||
Food and Support Services—International Sales (as adjusted) | $ | 657,805 | $ | 591,355 | 11 | % | |||||
| Six Months Ended | % Change | ||||||||||
| March 28, 2008 | March 30, 2007 | ||||||||||
Food and Support Services—International Sales (as reported) | $ | 1,319,602 | $ | 1,094,264 | 21 | % | |||||
Effect of Currency Translation | — | 96,764 | |||||||||
Effect of Acquisitions and Divestitures | (3,509 | ) | (557 | ) | |||||||
Food and Support Services—International Sales (as adjusted) | $ | 1,316,093 | $ | 1,190,471 | 11 | % | |||||
ADJUSTED OPERATING INCOME
Management believes that presentation of operating income growth, adjusted to eliminate increased amortization of acquisition-related customer relationship intangible assets and depreciation of property and equipment resulting from the Transaction, charges related to the Transaction, a currency transaction gain in 2007, the impact of the divestiture of SMG, a venue management company, in 2007 and the impact of foreign currency translation, provides useful information to investors because it enhances comparability between the current year and prior year reporting periods.
| Three Months Ended | % Change | |||||||||
| March 28, 2008 | March 30, 2007 | |||||||||
ARAMARK Corporation Consolidated Operating Income (as reported) | $ | 106,907 | $ | 4,972 | ||||||
Increased Amortization of Acquisition-Related Customer Relationship Intangible Assets and Depreciation of Property and Equipment Resulting from the Transaction | 32,727 | 19,350 | ||||||||
Transaction-Related Charges | — | 109,753 | ||||||||
Currency Transaction Gain | — | (3,804 | ) | |||||||
Divestiture of SMG in 2007 | — | (4,628 | ) | |||||||
Effect of Currency Translation | — | 4,670 | ||||||||
ARAMARK Corporation Consolidated Operating Income (as adjusted) | $ | 139,634 | $ | 130,313 | 7 | % | ||||
| Six Months Ended | % Change | |||||||||
| March 28, 2008 | March 30, 2007 | |||||||||
ARAMARK Corporation Consolidated Operating Income (as reported) | $ | 272,440 | $ | 177,289 | ||||||
Increased Amortization of Acquisition-Related Customer Relationship Intangible Assets and Depreciation of Property and Equipment Resulting from the Transaction | 63,742 | 19,350 | ||||||||
Transaction-Related Charges | — | 112,330 | ||||||||
Currency Transaction Gain | — | (3,804 | ) | |||||||
Divestiture of SMG in 2007 | — | (10,625 | ) | |||||||
Effect of Currency Translation | — | 8,465 | ||||||||
ARAMARK Corporation Consolidated Operating Income (as adjusted) | $ | 336,182 | $ | 303,005 | 11 | % | ||||
| Three Months Ended | % Change | |||||||||
| March 28, 2008 | March 30, 2007 | |||||||||
Food and Support Services – Domestic Operating Income (as reported) | $ | 74,583 | $ | 82,549 | ||||||
Increased Amortization of Acquisition-Related Customer Relationship Intangible Assets and Depreciation of Property and Equipment Resulting from the Transaction | 23,270 | 13,176 | ||||||||
Divestiture of SMG in 2007 | — | (4,628 | ) | |||||||
Effect of Currency Translation | — | 2,539 | ||||||||
Food and Support Services – Domestic Operating Income (as adjusted) | $ | 97,853 | $ | 93,636 | 5 | % | ||||
| Six Months Ended | % Change | |||||||||
| March 28, 2008 | March 30, 2007 | |||||||||
Food and Support Services – Domestic Operating Income (as reported) | $ | 196,431 | $ | 207,295 | ||||||
Increased Amortization of Acquisition-Related Customer Relationship Intangible Assets and Depreciation of Property and Equipment Resulting from the Transaction | 46,519 | 13,176 | ||||||||
Divestiture of SMG in 2007 | — | (10,625 | ) | |||||||
Effect of Currency Translation | — | 4,366 | ||||||||
Food and Support Services – Domestic Operating Income (as adjusted) | $ | 242,950 | $ | 214,212 | 13 | % | ||||