Exhibit 99.1
SWISHER HYGIENE INC.
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
On November 15, 2012, Swisher Hygiene Inc. (“the Company”) completed a stock sale (the “Sale”) of Choice Environmental Services and other previously acquired businesses, including Lawson Sanitation LLC, Central Carting Disposal, Inc., and FSR Transporting & Crane Services, Inc., that with Choice comprised the Company’s Waste segment, to Waste Services of Florida, Inc. for $123.3 million. The transaction resulted in a gain of $13.8 million after recording $22 million of tax benefits. The stock purchase agreement stipulated customary purchase price adjustments related to closing balance sheet working capital targets and, in addition, that $12.5 million of the purchase price consideration will be reserved and held back in escrow by the purchaser (“the holdback amount”) and paid subject to financial adjustments regarding defined long-term assets and EBITDA targets for the three months ended September 30, 2012.
The following Unaudited Pro Forma Consolidated Financial Information of the Company has been derived from the historical financial statements of the Company, as adjusted, to give effect to the Sale. The historical financial statements of the Company as set forth herein has been derived from the historical consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2012 and its Quarterly Report on Form 10-Q for the period ended September 30, 2012, wherein the Waste segment was presented as a discontinued operation for the Company. The Unaudited Pro Forma Consolidated Balance Sheet as of September 30, 2012, includes pro forma adjustments giving effect to the Sale as if it had occurred on that date. The Unaudited Pro Forma Consolidated Statements of Operations for the nine months ended September 30, 2012, and for the year ended December 31, 2011, includes pro forma adjustments giving effect to the Sale as if it had occurred on December 31, 2010.
The Unaudited Pro Forma Consolidated Financial Information is presented to comply with the rules and regulations of the Securities and Exchange Commission governing the disclosure of pro forma information. The Unaudited Pro Forma Consolidated Financial Information has been provided for informational purposes only and should not be considered indicative of the financial condition or results of operations that would have been achieved had the Sale occurred as of the dates presented. Accordingly, the Unaudited Pro Forma Consolidated Financial Information should not be read to be indicative of the Company’s financial condition or results of operations that might be achieved as of any future date or for any future period. The Unaudited Pro Forma Consolidated Financial Information, including the notes thereto, should be read in conjunction with the historical financial statements of the Company included in its Annual Report on Form 10-K for the years ended December 31, 2012 and 2011, and its Quarterly Reports on Form 10-Q filed for its quarters ended, March 31, June 30, and September 30, 2012.
Swisher Hygiene, Inc.
Pro Forma Consolidated Balance Sheet
As of September 30, 2012
Historical | (Unaudited) Pro Forma Adjustments | (Unaudited) Pro Forma | ||||||||||||
ASSETS | ||||||||||||||
Current assets | ||||||||||||||
Cash and cash equivalents | $ | 9,876 | $ | 111,841 | A | $ | 121,717 | |||||||
Restricted cash | — | — | ||||||||||||
Accounts receivable, net | 22,567 | 22,567 | ||||||||||||
Inventory | 16,719 | 16,719 | ||||||||||||
Assets of discontinued operations | 139,975 | (139,975 | ) | B | — | |||||||||
Other assets | 3,471 | 12,500 | C | 15,971 | ||||||||||
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Total current assets | 192,608 | (15,634 | ) | 176,974 | ||||||||||
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Property and equipment, net | 47,533 | 47,533 | ||||||||||||
Goodwill | 107,586 | 107,586 | ||||||||||||
Other intangibles, net | 51,970 | 51,970 | ||||||||||||
Deferred income tax assets | 14,829 | 14,829 | ||||||||||||
Other noncurrent assets | 3,604 | 3,604 | ||||||||||||
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$ | 418,130 | $ | (15,634 | ) | $ | 402,496 | ||||||||
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LIABILITIES AND EQUITY | ||||||||||||||
Current liabilities | ||||||||||||||
Accounts payable and accrued expenses | $ | 33,207 | $ | 3,030 | D | $ | 36,237 | |||||||
Related Party Payable | — | — | ||||||||||||
Long-term debt and obligations due within one year | 30,784 | 30,784 | ||||||||||||
Advances from shareholder | 2,000 | 2,000 | ||||||||||||
Liabilities of discontinued operations | 32,508 | (32,508 | ) | B | — | |||||||||
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Total current liabilities | 98,499 | (29,478 | ) | 69,021 | ||||||||||
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Long term debt and obligations | 12,409 | 12,409 | ||||||||||||
Other long-term liabilities | 3,389 | 3,389 | ||||||||||||
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Total noncurrent liabilities | 15,798 | — | 15,798 | |||||||||||
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Commitments and contingencies | ||||||||||||||
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Equity | ||||||||||||||
Total Swisher Hygiene Inc. stockholders’ equity | 303,811 | 13,844 | E | 317,655 | ||||||||||
Non-controlling interest | 22 | 22 | ||||||||||||
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Total stockholders’ equity | 303,833 | 13,844 | 317,677 | |||||||||||
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$ | 418,130 | $ | (15,634 | ) | $ | 402,496 | ||||||||
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Swisher Hygiene, Inc.
Pro Forma Consolidated Statement of Operations
For the Nine Months Ended September 30, 2012
Nine Months Ended September 30, 2012 | ||||||||||||||
Historical | Unaudited Pro Forma Adjustments | Unaudited Pro Forma | ||||||||||||
Revenue: | ||||||||||||||
Product | $ | 156,409 | $ | — | $ | 156,409 | ||||||||
Services | 20,016 | — | 20,016 | |||||||||||
Franchise and other | 928 | — | 928 | |||||||||||
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Total Revenue | 177,353 | — | 177,353 | |||||||||||
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Costs and expenses: | ||||||||||||||
Cost of sales (exclusive of route expenses and related depreciation and amortization) | 78,124 | — | 78,124 | |||||||||||
Route expenses | 31,756 | — | 31,756 | |||||||||||
Selling, general and administrative | 95,598 | — | 95,598 | |||||||||||
Acquisition and merger expenses | 220 | — | 220 | |||||||||||
Depreciation and amortization | 15,820 | — | 15,820 | |||||||||||
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Total costs and expenses | 221,518 | — | 221,518 | |||||||||||
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Loss from continuing operations | (44,165 | ) | — | (44,165 | ) | |||||||||
Other expense, net | (1,306 | ) | — | (1,306 | ) | |||||||||
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Net loss from continuing operations before income taxes | (45,471 | ) | — | (45,471 | ) | |||||||||
Income tax expense | (109 | ) | — | (109 | ) | |||||||||
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Net loss from continuing operations | (45,580 | ) | — | (45,580 | ) | |||||||||
Income from discontinued operations, net of tax | 1,866 | (1,866 | ) | F | — | |||||||||
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Net Loss | (43,714 | ) | (1,866 | ) | (45,580 | ) | ||||||||
Net income attributable to non-controlling interest | — | — | — | |||||||||||
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Net loss attributable to Swisher Hygiene Inc. | $ | (43,714 | ) | $ | (1,866 | ) | $ | (45,580 | ) | |||||
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Swisher Hygiene, Inc.
Pro Forma Consolidated Statement of Operations
For the Year Ended December 31, 2011
Year Ended December 31, 2011 | ||||||||||||||
Historical | Unaudited Pro Forma Adjustments | Unaudited Pro Forma | ||||||||||||
Revenue: | ||||||||||||||
Product | $ | 131,109 | $ | — | $ | 131,109 | ||||||||
Services | 26,107 | — | 26,107 | |||||||||||
Franchise and other | 3,401 | — | 3,401 | |||||||||||
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Total Revenue | 160,617 | — | 160,617 | |||||||||||
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Costs and expenses: | ||||||||||||||
Cost of sales (exclusive of route expenses and related depreciation and amortization) | 67,942 | — | 67,942 | |||||||||||
Route expenses | 33,254 | — | 33,254 | |||||||||||
Selling, general and administrative | 79,557 | — | 79,557 | |||||||||||
Acquisition and merger expenses | 6,107 | — | 6,107 | |||||||||||
Depreciation and amortization | 12,690 | — | 12,690 | |||||||||||
Gain from bargain purchase | (4,359 | ) | — | (4,359 | ) | |||||||||
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Total costs and expenses | 195,191 | — | 195,191 | |||||||||||
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Loss from continuing operations | (34,574 | ) | — | (34,574 | ) | |||||||||
Other expense, net | (6,765 | ) | — | (6,765 | ) | |||||||||
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Net loss from continuing operations before income taxes | (41,339 | ) | — | (41,339 | ) | |||||||||
Income tax benefit | 16,616 | — | 16,616 | |||||||||||
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Net loss from continuing operations | (24,723 | ) | — | (24,723 | ) | |||||||||
Loss from discontinued operations, net of tax | (623 | ) | 623 | F | — | |||||||||
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Net Loss | (25,346 | ) | 623 | (24,723 | ) | |||||||||
Net income attributable to non-controlling interest | 6 | — | 6 | |||||||||||
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Net loss attributable to Swisher Hygiene Inc. | $ | (25,340 | ) | $ | 623 | $ | (24,717 | ) | ||||||
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SWISHER HYGIENE INC.
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
A. | Reflects an adjustment to record the cash proceeds of $111.8 million from the Sale. |
B. | Reflects adjustments to eliminate $140.0 million of assets and $32.5 million of liabilities sold in the Sale. |
C. | Reflects an adjustment to record the $12.5 million holdback receivable from the buyer as additional proceeds on the Sale. |
D. | Reflects an adjustment to record additional liabilities incurred as a result of the Sale of $3.0 million. |
E. | Reflects the adjustment to retained earnings to record the gain on the Sale of $13.8 million. |
F. | Reflects the adjustments to eliminate the income and losses from the operations of the Waste Segment of $1.9 million for the nine months ended September 30, 2012 and $0.6 million for the year ended December 31, 2011. |