Exhibit 99.1
NACCO INDUSTRIES, INC.
INTRODUCTION TO THE UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
The following unaudited pro forma consolidated financial information of NACCO Industries, Inc. ("NACCO") and its wholly-owned subsidiaries (collectively, the "Company") gives effect to the spin-off (the "Spin-Off) of Hyster-Yale Materials Handling, Inc. ("Hyster-Yale"), which occurred on September 28, 2012. To complete the Spin-Off, NACCO paid a dividend of one share of Hyster-Yale Class A common stock, par value $0.01 per share, and one share of Hyster-Yale Class B common stock, par value $0.01 per share, after the close of trading on September 28, 2012 for each share of NACCO Class A common stock, par value $1.00 per share, and NACCO Class B common stock, par value $1.00 per share, outstanding as of 5:00 p.m. Eastern Time on the record date of September 25, 2012. Effective with the Spin-Off, Hyster-Yale is accounted for as a discontinued operation in the Company's financial statements in accordance with Accounting Standards Codification 205, "Presentation of Financial Statements" ("ASC 205").
The historical financial information of the Company set forth below has been derived from the historical audited and unaudited consolidated financial statements of the Company included in the Company's Annual Report on Form 10-K for the year ended December 31, 2011 (the "Annual Report") and the Company's Quarterly Report on Form 10-Q for the six months ended June 30, 2012 (the "Quarterly Report"). The unaudited pro forma consolidated statements of income were prepared as if the Spin-Off occurred as of January 1, 2009. The unaudited pro forma consolidated balance sheet as of June 30, 2012 is prepared as if the Spin-Off occurred on that date. Pro forma income statements for the three most recently completed fiscal years are presented because the treatment of the Spin-Off has not yet been reflected as discontinued operations in the Company's historical information. The unaudited pro forma consolidated financial information does not include the impact of the transition services agreement or office services agreement that were entered into with Hyster-Yale. Under the terms of the transition services agreement, NACCO will obtain services from Hyster-Yale and provide services to Hyster-Yale on a transitional basis, as needed, for varying periods after the spin-off date. None of the transition services are expected to exceed one year. NACCO or Hyster-Yale may extend the initial transition period for a period of up to three months for any service upon 30 days written notice to the other party prior to the initial termination date. NACCO expects to pay net aggregate fees of no more than $625,000 over the initial term of the transition services agreement. In addition, NACCO and Hyster-Yale entered into an office services agreement pursuant to which NACCO is expected to pay approximately $180,000 annually to Hyster-Yale. The office services agreement will have an initial term of one year and will automatically renew for additional one year periods until terminated by either NACCO or Hyster-Yale.
The pro forma adjustments are based on available information and certain assumptions that management believes are reasonable as of the date of this filing. However, actual adjustments may differ materially from the information presented and the pro forma adjustments may differ from those that will be calculated to report Hyster-Yale as a discontinued operation by NACCO in future filings. The adjustments are directly attributable to the Spin-Off and are expected to have a continuing impact on the financial position and results of operations of the Company. The statements of income do not reflect any adjustments for non-recurring items. In the opinion of management, all adjustments necessary to present fairly the unaudited pro forma consolidated financial information of the Company has been made.
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 and its Quarterly Report. The unaudited pro forma consolidated financial statements presented do not purport to represent what the Company's results of operations or financial position would actually have been had the Spin-Off occurred on the dates presented, nor is it intended to be indicative of the Company's future results of operations or financial position.
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
YEAR ENDED JUNE 30, 2012
(In millions, except per share amounts)
|
| | | | | | | | | | | | | | | |
| | | | Pro Forma Adjustments | | |
| | As Reported | | HY | | | | Pro Forma |
| | NACCO | | Spin-Off (a) | | Other | | NACCO |
| | | | | | | | |
| ASSETS | |
| | | | | | |
| Current Assets | |
| | | | | | |
| Cash and cash equivalents | $ | 303.2 |
| | $ | (143.1 | ) | | $ | — |
| | $ | 160.1 |
|
| Accounts receivable, net | 416.8 |
| | (339.5 | ) | | 3.0 |
| (b) | 80.3 |
|
| Inventories, net | 474.8 |
| | (300.9 | ) | | — |
| | 173.9 |
|
| Deferred income taxes | 22.5 |
| | (5.3 | ) | | — |
| | 17.2 |
|
| Prepaid expenses and other | 46.8 |
| | (31.0 | ) | | — |
| | 15.8 |
|
| Assets held for sale | 10.0 |
| | — |
| | — |
| | 10.0 |
|
| Total Current Assets | 1,274.1 |
| | (819.8 | ) | | 3.0 |
| | 457.3 |
|
| Property, Plant and Equipment, Net | 274.7 |
| | (137.7 | ) | | — |
| | 137.0 |
|
| Coal Supply Agreement, Net | 56.8 |
| | — |
| | — |
| | 56.8 |
|
| Long-term Deferred Income Taxes | 4.0 |
| | (11.4 | ) | | — |
| | (7.4 | ) |
| Other Non-current Assets | 95.2 |
| | (63.1 | ) | | — |
| | 32.1 |
|
| Total Assets | $ | 1,704.8 |
| | $ | (1,032.0 | ) | | $ | 3.0 |
| | $ | 675.8 |
|
| LIABILITIES AND EQUITY | |
| | | | |
| | |
| Current Liabilities | |
| | | | |
| | |
| Accounts payable | $ | 396.6 |
| | $ | (310.0 | ) | | $ | 3.0 |
| (b) | $ | 89.6 |
|
| Revolving credit agreements - not guaranteed by the parent company | 62.7 |
| | — |
| | — |
| | 62.7 |
|
| Current maturities of long-term debt - not guaranteed by the parent company | 37.0 |
| | (30.1 | ) | | — |
| | 6.9 |
|
| Accrued payroll | 43.1 |
| | (29.6 | ) | | — |
| | 13.5 |
|
| Deferred revenue | 9.4 |
| | (7.9 | ) | | — |
| | 1.5 |
|
| Other current liabilities | 141.5 |
| | (106.4 | ) | | — |
| | 35.1 |
|
| Total Current Liabilities | 690.3 |
| | (484.0 | ) | | 3.0 |
| | 209.3 |
|
| Long-term Debt - not guaranteed by the parent company | 207.8 |
| | (112.5 | ) | | — |
| | 95.3 |
|
| Pension and other Postretirement Obligations | 72.2 |
| | (46.6 | ) | | — |
| | 25.6 |
|
| Long-term Deferred Income Taxes | 3.6 |
| | — |
| | — |
| | 3.6 |
|
| Other Long-term Liabilities | 114.2 |
| | (52.4 | ) | | — |
| | 61.8 |
|
| Total Liabilities | 1,088.1 |
| | (695.5 | ) | | 3.0 |
| | 395.6 |
|
| Stockholders' Equity | |
| | | | |
| | |
| Common stock: | |
| | | | |
| | |
| Class A | 6.8 |
| | — |
| | — |
| | 6.8 |
|
| Class B | 1.6 |
| | — |
| | — |
| | 1.6 |
|
| Capital in excess of par value | 24.3 |
| | — |
| | — |
| | 24.3 |
|
| Retained earnings | 657.6 |
| | (388.6 | ) | | — |
| | 269.0 |
|
| Accumulated other comprehensive income (loss) | (74.4 | ) | | 52.9 |
| | — |
| | (21.5 | ) |
| Total Stockholders' Equity | 615.9 |
| | (335.7 | ) | | — |
| | 280.2 |
|
| Noncontrolling Interest | 0.8 |
| | (0.8 | ) | | — |
| | — |
|
| Total Equity | 616.7 |
| | (336.5 | ) | | — |
| | 280.2 |
|
| Total Liabilities and Equity | $ | 1,704.8 |
| | $ | (1,032.0 | ) | | $ | 3.0 |
| | $ | 675.8 |
|
See notes to pro forma unaudited condensed consolidated financial statements.
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME (LOSS)
SIX MONTHS ENDED JUNE 30, 2012
(In millions, except per share amounts)
|
| | | | | | | | | | | |
| | | | Pro Forma Adjustments | | |
| | As Reported | | HY | | Pro Forma |
| | NACCO | | Spin-Off (a) | | NACCO |
| | | | | | |
| Revenues | $ | 1,576.6 |
| | $ | (1,231.5 | ) | | $ | 345.1 |
|
| Cost of sales | 1,291.9 |
| | (1,035.6 | ) | | 256.3 |
|
| Gross Profit | 284.7 |
| | (195.9 | ) | | 88.8 |
|
| Earnings of unconsolidated mines | 22.6 |
| | — |
| | 22.6 |
|
| Operating Expenses | | | | | |
| Selling, general and administrative expenses | 240.3 |
| | (141.5 | ) | | 98.8 |
|
| Gain on the sale of assets | (2.3 | ) | | — |
| | (2.3 | ) |
| Operating Profit | 69.3 |
| | (54.4 | ) | | 14.9 |
|
| Other (income) expense | |
| | | | |
| Interest expense | 10.4 |
| | (7.2 | ) | | 3.2 |
|
| Other | (0.3 | ) | | 1.2 |
| | 0.9 |
|
| | 10.1 |
| | (6.0 | ) | | 4.1 |
|
| Income Before Income Taxes | 59.2 |
| | (48.4 | ) | | 10.8 |
|
| Income tax provision | 12.2 |
| | (7.7 | ) | | 4.5 |
|
| Net Income From Continuing Operations and Attributable to Stockholders | $ | 47.0 |
| | $ | (40.7 | ) | | $ | 6.3 |
|
| | |
| | | | |
| Basic Earnings per Share | $ | 5.61 |
| |
|
| | $ | 0.75 |
|
| Diluted Earnings per Share | $ | 5.60 |
| |
|
| | $ | 0.75 |
|
| | | | | | |
| Basic Weighted Average Shares Outstanding | 8.383 |
| | | | 8.383 |
|
| Diluted Weighted Average Shares Outstanding | 8.397 |
| | | | 8.397 |
|
See notes to pro forma unaudited condensed consolidated financial statements.
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME (LOSS)
YEAR ENDED DECEMBER 31, 2011
(In millions, except per share amounts)
|
| | | | | | | | | | | |
| | | | Pro Forma Adjustments | | |
| | As Reported | | HY | | Pro Forma |
| | NACCO | | Spin-Off (a) | | NACCO |
| | | | | | |
| Revenues | $ | 3,331.2 |
| | $ | (2,540.8 | ) | | $ | 790.4 |
|
| Cost of sales | 2,738.1 |
| | (2,157.3 | ) | | 580.8 |
|
| Gross Profit | 593.1 |
| | (383.5 | ) | | 209.6 |
|
| Earnings of unconsolidated mines | 45.5 |
| | — |
| | 45.5 |
|
| Operating Expenses | | | | | |
| Selling, general and administrative expenses | 465.3 |
| | (273.3 | ) | | 192.0 |
|
| Gain on the sale of assets | (0.8 | ) | | (0.2 | ) | | (1.0 | ) |
| Operating Profit | 174.1 |
| | (110.0 | ) | | 64.1 |
|
| Other (income) expense | |
| | | | |
| Interest expense | 24.5 |
| | (15.8 | ) | | 8.7 |
|
| Income from other unconsolidated affiliates | (7.4 | ) | | 6.0 |
| | (1.4 | ) |
| Applica settlement and litigation costs | (57.2 | ) | | — |
| | (57.2 | ) |
| Other | 0.4 |
| | 1.3 |
| | 1.7 |
|
| | (39.7 | ) | | (8.5 | ) | | (48.2 | ) |
| Income Before Income Taxes | 213.8 |
| | (101.5 | ) | | 112.3 |
|
| Income tax provision | 51.7 |
| | (18.9 | ) | | 32.8 |
|
| Net Income From Continuing Operations and Attributable to Stockholders | $ | 162.1 |
| | $ | (82.6 | ) | | $ | 79.5 |
|
| | |
| | | | |
| Basic Earnings per Share | $ | 19.34 |
| |
|
| | $ | 9.48 |
|
| Diluted Earnings per Share | $ | 19.28 |
| |
|
| | $ | 9.46 |
|
| | | | | | |
| Basic Weighted Average Shares Outstanding | 8.383 |
| | | | 8.383 |
|
| Diluted Weighted Average Shares Outstanding | 8.408 |
| | | | 8.408 |
|
See notes to pro forma unaudited condensed consolidated financial statements.
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME (LOSS)
YEAR ENDED DECEMBER 31, 2010
(In millions, except per share amounts)
|
| | | | | | | | | | | |
| | | | Pro Forma Adjustments | | |
| | As Reported | | HY | | Pro Forma |
| | NACCO | | Spin-Off (a) | | NACCO |
| | | | | | |
| Revenues | $ | 2,687.5 |
| | $ | (1,801.9 | ) | | $ | 885.6 |
|
| Cost of sales | 2,161.3 |
| | (1,522.1 | ) | | 639.2 |
|
| Gross Profit | 526.2 |
| | (279.8 | ) | | 246.4 |
|
| Earnings of unconsolidated mines | 43.4 |
| | — |
| | 43.4 |
|
| Operating Expenses | | | | | |
| Selling, general and administrative expenses | 425.3 |
| | (229.5 | ) | | 195.8 |
|
| Restructuring charges (reversals) | (1.9 | ) | | 1.9 |
| | — |
|
| Loss on sale of businesses | 4.0 |
| | (4.0 | ) | | — |
|
| Loss on the sale of assets | 1.9 |
| | (2.1 | ) | | (0.2 | ) |
| Operating Profit | 140.3 |
| | (46.1 | ) | | 94.2 |
|
| Other (income) expense | |
| | | | |
| Interest expense | 27.4 |
| | (16.6 | ) | | 10.8 |
|
| Income from other unconsolidated affiliates | (2.3 | ) | | 2.3 |
| | — |
|
| Applica settlement and litigation costs | 18.8 |
| | — |
| | 18.8 |
|
| Other | (0.4 | ) | | 2.3 |
| | 1.9 |
|
| | 43.5 |
| | (12.0 | ) | | 31.5 |
|
| Income Before Income Taxes | 96.8 |
| | (34.1 | ) | | 62.7 |
|
| Income tax provision | 17.4 |
| | (1.8 | ) | | 15.6 |
|
| Income From Continuing Operations | 79.4 |
| | (32.3 | ) | | 47.1 |
|
| Net loss attributable to noncontrolling interest | 0.1 |
| | (0.1 | ) | | — |
|
| Net Income From Continuing Operations and Attributable to Stockholders | $ | 79.5 |
| | $ | (32.4 | ) | | $ | 47.1 |
|
| | |
| | | | |
| Basic Earnings per Share | $ | 9.55 |
| | | | $ | 5.66 |
|
| Diluted Earnings per Share | $ | 9.53 |
| | | | $ | 5.64 |
|
| | | | | | |
| Basic Weighted Average Shares Outstanding | 8.328 |
| | | | 8.328 |
|
| Diluted Weighted Average Shares Outstanding | 8.344 |
| | | | 8.344 |
|
See notes to pro forma unaudited condensed consolidated financial statements.
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME (LOSS)
YEAR ENDED DECEMBER 31, 2009
(In millions, except per share amounts)
|
| | | | | | | | | | | |
| | | | Pro Forma Adjustments | | |
| | As Reported | | HY | | Pro Forma |
| | NACCO | | Spin-Off (a) | | NACCO |
| | | | | | |
| Revenues | $ | 2,310.6 |
| | $ | (1,475.2 | ) | | $ | 835.4 |
|
| Cost of sales | 1,902.5 |
| | (1,290.5 | ) | | 612.0 |
|
| Gross Profit | 408.1 |
| | (184.7 | ) | | 223.4 |
|
| Earnings of unconsolidated mines | 38.6 |
| | — |
| | 38.6 |
|
| Operating Expenses | | | | | |
| Selling, general and administrative expenses | 388.3 |
| | (208.0 | ) | | 180.3 |
|
| Restructuring charges (reversals) | 9.3 |
| | (9.3 | ) | | — |
|
| Gain on the sale of assets | (10.0 | ) | | 1.4 |
| | (8.6 | ) |
| Operating Profit | 59.1 |
| | 31.2 |
| | 90.3 |
|
| Other (income) expense | |
| | | | |
| Interest expense | 32.2 |
| | (19.0 | ) | | 13.2 |
|
| Loss from other unconsolidated affiliates | 1.7 |
| | (1.7 | ) | | — |
|
| Applica settlement and litigation costs | 1.1 |
| | — |
| | 1.1 |
|
| Other | (4.8 | ) | | 5.1 |
| | 0.3 |
|
| | 30.2 |
| | (15.6 | ) | | 14.6 |
|
| Income Before Income Taxes | 28.9 |
| | 46.8 |
| | 75.7 |
|
| Income tax provision | 20.5 |
| | 3.6 |
| | 24.1 |
|
| Income From Continuing Operations | 8.4 |
| | 43.2 |
| | 51.6 |
|
| Net loss attributable to noncontrolling interest | 0.1 |
| | (0.1 | ) | | — |
|
| Net Income From Continuing Operations and Attributable to Stockholders | $ | 8.5 |
| | $ | 43.1 |
| | $ | 51.6 |
|
| | |
| | | | |
| Basic Earnings per Share | $ | 1.03 |
| | | | $ | 6.22 |
|
| Diluted Earnings per Share | $ | 1.02 |
| | | | $ | 6.22 |
|
| | | | | | |
| Basic Weighted Average Shares Outstanding | 8.290 |
| | | | 8.290 |
|
| Diluted Weighted Average Shares Outstanding | 8.296 |
| | | | 8.296 |
|
See notes to pro forma unaudited condensed consolidated financial statements.
NACCO INDUSTRIES, INC.
Notes to the Pro Forma Unaudited Condensed Consolidated Financial Statements
(a) The HY Spin-Off column represents the historical financial results of the Hyster-Yale materials handling business as such operating results were included in NACCO's consolidated financial statements for the periods presented (and accordingly are reflected in the As Reported NACCO columns).
(b) Represents intercompany accounts receivable and intercompany accounts payable between the parent company and Hyster-Yale at June 30, 2012.
