EXHIBIT 99.3
UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
The attached tables set forth Transpro's (now known as Proliance International,
Inc.) results of operations for the year ended December 31, 2004 and the three
months ended March 31, 2005 as if the merger had occurred on January 1, 2004.
The results for the year ended December 31, 2004 and three months ended March
31, 2005 reflect the Transpro results from continuing operations for that period
combined with the Modine Aftermarket Business results for the same periods.
Transpro's balance sheet at March 31, 2005 is combined with the Modine
Aftermarket Business's balance sheet at March 31, 2005. The unaudited pro forma
combined financial information assumes that the merger is accounted for using
the purchase method of accounting and represents a current estimate based on
available information of the combined company's results of operations. The
unaudited pro forma combined financial information includes adjustments to
record the assets and liabilities of the Modine Aftermarket Business at their
estimated fair values and is subject to further adjustment as additional
information becomes available and as additional analyses are performed. The
unaudited pro forma combined financial statements do not currently include any
adjustments to reflect any of the restructuring costs expected to be incurred in
order to combine the operations of Transpro and the Modine Aftermarket Business
or the anticipated benefits from these actions. These restructuring costs will
result from actions taken with respect to both Transpro and Modine Aftermarket
Business operations, facilities and associates. The charges will be recorded
based upon the nature and timing of these integration actions. The unaudited pro
forma combined financial statements do not reflect any of the synergistic
benefits expected by management to be realized in the merger. The unaudited pro
forma combined financial information should be read together with, and is
qualified in its entirety by, the historical financial statements, including the
notes thereto, of Transpro and the Modine Aftermarket Business incorporated by
reference or appearing in the Transpro S-4 proxy
statement/prospectus--information statement and herein.
The unaudited pro forma combined financial information described above is being
provided for illustrative purposes only. The companies may have performed
differently had they actually been combined during the periods presented. You
should not rely on the unaudited pro forma combined financial information as
being indicative of the historical results that would have been achieved had the
companies been combined during the periods presented or of the future results
that the combined company will experience.
1
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2004
(in thousands, except per share amounts)
<TABLE>
MODINE
AFTERMARKET PRO FORMA COMBINED
TRANSPRO, INC.(a) BUSINESS (b) ADJUSTMENTS PRO FORMA
----------------- ------------ ----------- ---------
Net sales............................................... $218,433 $ 211,708 $ 0 $430,141
Cost of sales........................................... 174,575 146,385 3,928 (c) 324,888
-------------------------------------------------------------
Gross margin............................................ 43,858 65,323 (3,928) 105,253
Selling, general and administrative expenses............ 39,987 69,263 (9,313)(c) 99,937
Restructuring and other special charges................. 0 (49) 0 (49)
-------------------------------------------------------------
Operating income (loss) from continuing
operations............................................ 3,871 (3,891) 5,385 5,365
Interest expense........................................ 4,812 104 0 4,916
Other (income), net..................................... 0 (126) 0 (126)
-------------------------------------------------------------
(Loss) income before taxes from continuing
operations............................................ (941) (3,869) 5,385 575
Income tax (benefit) provision.......................... (621) (2,668) 4,989 (d) 1,700
-------------------------------------------------------------
(Loss) income from continuing operations................ $ (320) $ (1,201) $396 $(1,125)
=============================================================
(Loss) income per common share from continuing operations:
Basic................................................. $ (0.05) $ (0.08)
======== =======
Diluted............................................... $ (0.05) $ (0.08)
======== =======
Weighted average common shares:
Basic................................................. 7,106 8,146 (e) 15,252
======== =========================
Diluted............................................... 7,106 8,146 (e) 15,252
======== =========================
</TABLE>
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2005
(in thousands, except per share amounts)
<TABLE>
MODINE
AFTERMARKET PRO FORMA COMBINED
TRANSPRO, INC.(a) BUSINESS(b) ADJUSTMENTS PRO FORMA
----------------- ------------ ----------- ---------
Net sales............................................. $ 48,308 $ 46,503 $ 0 $ 94,811
Cost of sales......................................... 39,341 32,972 490 (f) 72,803
-------------------------------------------------------------
Gross margin.......................................... 8,967 13,531 (490) 22,008
Selling, general and administrative expenses.......... 10,575 15,711 (1,979)(f) 24,307
Restructuring and other special charges............... 262 0 0 262
-------------------------------------------------------------
Operating (loss) income from continuing
operations.......................................... (1,870) (2,180) 1,489 (2,561)
Interest expense...................................... 1,457 10 0 1,467
Other (income), net................................... 0 (75) 0 (75)
-------------------------------------------------------------
(Loss) income from continuing operations
before taxes........................................ (3,327) (2,115) 1,489 (3,953)
Income tax (benefit) provision........................ (1,055) (368) 1,673 (d) 250
-------------------------------------------------------------
(Loss) from continuing operations..................... $ (2,272) $ (1,747) $(184) $(4,203)
=============================================================
(Loss) from continuing operations per common share:
Basic............................................... $ (0.32) $ (0.28)
======== =======
Diluted............................................. $ (0.32) $ (0.28)
======== =======
Weighted average common shares:
Basic............................................... 7,107 8,146 (e) 15,253
======== =========================
Diluted............................................. 7,107 8,146 (e) 15,253
======== =========================
</TABLE>
See Notes to Unaudited Pro Forma Combined Statements of Operations.
2
NOTES TO UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
(a) Information reflects results of continuing operations derived from the
historical SEC filings of Transpro. Transpro's reporting year end is
December 31. Transpro's results for the year ended December 31, 2004 have
been derived from Transpro's Form 8-K filed with the SEC on June 15, 2005.
(b) The amounts included in the annual operating results represent the
unaudited information for the Modine Aftermarket Business for the 12 months
ended December 26, 2004. The Modine Aftermarket Business was reported as
part of Modine Manufacturing Company, which utilizes a March 31 fiscal year
end. Results for the Modine Aftermarket Business for the three months ended
March 31, 2005 are combined with Transpro's results for the three months
ended March 31, 2005.
(c) Represents the reclassification of certain Modine Aftermarket Business
expenses from selling, general and administrative expense in order to
comply with Transpro methods of accounting ($8.0 million). This impact has
been reduced by the amount which would have been capitalized into inventory
($0.2 million). Depreciation expense for the Modine Aftermarket Business
has been reduced to zero in order to reflect the application of negative
goodwill as a result of purchase accounting ($3.9 million in cost of sales;
$1.3 million in selling, general and administrative expenses). The amounts
presented do not include the effect of the fair value adjustment made to
inventory.
(d) Represents a tax provision on the foreign pretax income generated by
the entries above. The U.S. federal income tax benefit reported by the
Modine Aftermarket Business for the period has also been reversed due to
the fact that Transpro has recorded a tax valuation reserve.
(e) Represents the shares issued to Modine shareholders as a result of the
merger.
(f) Represents the reclassification of certain Modine Aftermarket Business
expenses from selling, general and administrative expense in order to
comply with Transpro methods of accounting ($1.6 million). Depreciation
expense for the Modine Aftermarket Business has been reduced to zero in
order to reflect the application of negative goodwill as a result of
purchase accounting ($1.1 million in cost of sales; $0.4 million in
selling, general and administrative expenses). The amounts presented do not
include the effect of the fair value adjustment made to inventory.
3
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
MARCH 31, 2005
(in thousands)
<TABLE>
MODINE
TRANSPRO, AFTERMARKET PRO FORMA COMBINED
INC. (a) BUSINESS (b) ADJUSTMENTS PRO FORMA
---------- ------------ ----------- ---------
ASSETS
Current assets:
Cash and equivalents............................ $ 423 $ 7,373 $ (1,073)(c6) $ 6,723
Accounts receivable, net........................ 38,066 27,513 0 65,579
Inventories, net................................ 77,936 67,636 7,491 (c8),(c9) 153,063
Other current assets............................ 2,462 3,189 0 5,651
---------------------------------------------------------------------------
Total current assets.............................. 118,887 105,711 6,418 231,016
Net property, plant and equipment................. 18,718 22,131 (22,131)(c5),(c11) 18,718
Other assets...................................... 6,003 1,321 (2,236)(c2) 5,088
---------------------------------------------------------------------------
Total assets...................................... $143,608 $129,163 $(17,949) $254,822
===========================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Revolving credit debt and current
portion of long-term debt..................... $ 36,908 $ 0 $ 0 $ 36,908
Accounts payable................................ 33,612 12,628 0 46,240
Accrued liabilities............................. 16,212 12,874 10,571 (c3),(c4),(c7),(c10) 39,657
---------------------------------------------------------------------------
Total current liabilities......................... 86,732 25,502 10,571 122,805
---------------------------------------------------------------------------
Long-term liabilities:
Long-term debt.................................. 1,035 0 0 1,035
Other long-term liabilities..................... 6,536 3,529 (890)(c4) 9,175
---------------------------------------------------------------------------
Total long-term liabilities....................... 7,571 3,529 (890) 10,210
---------------------------------------------------------------------------
Commitments and contingent liabilities:
Stockholders' equity:
Preferred stock.................................
Common stock.................................... 71 0 81 (c1) 152
Paid in capital................................. 55,052 0 50,586 (c1) 105,638
Retained earnings............................... 606 0 21,835 (c12) 22,441
Accumulated other comprehensive loss............ (6,409) 0 0 (6,409)
Parent equity in subsidiary..................... 100,132 (100,132)(c) 0
Treasury stock.................................. (15) 0 0 (15)
---------------------------------------------------------------------------
Total stockholders' equity........................ 49,305 100,132 (27,630) 121,807
---------------------------------------------------------------------------
Total liabilities and stockholders' equity........ $143,608 $129,163 $(17,949) $254,822
===========================================================================
</TABLE>
See Notes to Unaudited Pro Forma Combined Balance Sheet.
4
NOTES TO UNAUDITED PRO FORMA COMBINED BALANCE SHEET
(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)
(a) Information was derived from the historical SEC filings of Transpro at March
31, 2005.
(b) Represents the audited assets and liabilities for the Modine Aftermarket
Business as of March 31, 2005 as developed by Modine. Amounts receivable from
and payable to affiliates have been included in Modine equity as required by the
merger agreement.
(c) This adjustment reflects a preliminary allocation of the purchase price to
the identifiable net assets acquired and the excess to negative goodwill.
<TABLE>
(c1) Issuance of 8,145,795 shares of Transpro common stock to Modine
shareholders valued at $6.22 per share, the average closing price of
Transpro common stock for the two days before and after the merger
agreement was announced.
Common stock........................................................................ $81
Paid in capital..................................................................... 50,586
--------
Total value......................................................................... $50,667
(c2) Transaction costs incurred by Transpro through March 31, 2005....................... 2,236
(c3) Additional estimated Transpro transaction costs to be incurred...................... 1,782
--------
Estimated total consideration....................................................... $54,685
--------
Preliminary estimate of Modine Aftermarket Business net assets acquired:
Modine Aftermarket Business net assets at March 31, 2005............................ $100,132
Adjustments:
(c4) Estimated adjustment to exclude liabilities not assumed by Transpro per
the merger agreement ($444 current, $890 long-term)................................. 1,334
(c5) Adjustment to include additional assets per the merger agreement.................... 103
(c6) Cash in excess of $6.3 million repaid to Modine..................................... (1,073)
(c7) Adjustment to reflect liability for Modine transaction costs as required by
the merger agreement................................................................ (3,633)
(c8) Preliminary estimate of adjustment to fair value of inventory....................... 4,387
(c9) Adjustment to capitalize into inventory certain Modine Aftermarket
Business expenses in order to comply with Transpro methods of
accounting.......................................................................... 3,104
(c10) Accrual for estimated restructuring charges associated with Modine
Aftermarket Business locations and employees. Restructuring costs which
are not included on the opening balance sheet will be charged to operating
results as incurred................................................................. (5,600)
--------
Estimated net assets acquired....................................................... $98,754
--------
Preliminary estimate representing the excess of net assets over total consideration....... $44,069
(c11) Write-down property, plant and equipment of Modine Aftermarket
Business to zero.................................................................... $22,234
--------
(c12) Negative goodwill to be recorded in income in connection with the
acquisition included in results of operations in the initial year after the
acquisition......................................................................... $21,835
========
</TABLE>
5
