EXHIBIT 99.4
EMCON
PRO FORMA CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
- ----------------------------------------- --------------------------------------------------------------------------
Three months ended March 31, 1996
-------------------------------------------------------------------------
Pro Forma Pro Forma
EMCON OWT Adjustments Consolidated
(In thousands, except share amounts) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
- --------------------------------------------------------------------------------------------------------------------
Gross revenue ................................ $ 26,889 $ 4,574 $ -- $ 31,463
Outside services, at cost .................... 3,957 -- -- 3,957
-------- -------- -------- --------
Net revenue ......................... 22,932 4,574 -- 27,506
Costs and expenses:
Direct expenses ......................... 8,544 3,385 -- 11,929
Indirect expenses ....................... 14,459 1,181 66 (1) 15,706
-------- -------- -------- --------
Income (loss) from
operations .......................... (71) 8 (66) (129)
Interest income (expense), net ............... 3 (79) (186) (2,3,4) (262)
Equity in loss of affiliates ................. (41) (2) -- (43)
-------- -------- -------- --------
Loss before benefit for income taxes ......... (109) (73) (252) (434)
Benefit for income taxes ..................... (38) (39) (75) (5) (152)
-------- -------- -------- --------
Net loss ..................................... $ (71) $ (34) $ (177) $ (282)
======== ======== ======== ========
Loss per share ............................... $ (0.03)
========
See accompanying notes to pro forma consolidated condensed financial statements.
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EMCON
PRO FORMA CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Unaudited)
-------------------------------------------------------------------------------------------------------------------------
Twelve months ended December 31, 1995
----------------------------------------------------------------------------
Pro Forma Pro Forma
EMCON OWT Adjustments Consolidated
(In thousands, except share amounts) (Audited) (Audited) (Unaudited) (Unaudited)
-------------------------------------------------------------------------------------------------------------------------
Gross revenue .......................... $ 122,542 $ 17,519 $ -- 140,061
Outside services, at cost .............. 19,133 -- -- 19,133
--------- --------- --------- ---------
Net revenue ................... 103,409 17,519 -- 120,928
Costs and expenses:
Direct expenses ................... 39,473 13,590 -- 53,063
Indirect expenses ................. 61,481 2,199 408 (1) 64,088
--------- --------- --------- ---------
Income from operations ........ 2,455 1,730 (408) 3,777
Interest income (expense), net ......... 188 (349) (1,032) (2,3,4) (1,193)
Equity in loss of affiliates ........... (74) (39) -- (113)
--------- --------- --------- ---------
Income before provision for income taxes 2,569 1,342 (1,440) 2,471
Provision for income taxes ............. 783 567 (485) (5) 865
--------- --------- --------- ---------
Net income ............................. $ 1,786 $ 775 $ (955) $ 1,606
========= ========= ========= =========
Income per share ....................... $ 0.20
=========
See accompanying notes to pro forma consolidated condensed financial
statements..
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EMCON
NOTES TO PRO FORMA CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
- --------------------------------------------------------------------------------
The pro forma consolidated statements of operations/income assume the
acquisition took place as of the beginning of each period presented. The pro
forma statements of operations/income for the three months ended March 31, 1996
and twelve months ended December 31, 1995 reflect the combination of the EMCON
and Organic Waste Technologies, Inc., and Subsidiaries ("OWT") historical
consolidated financial statements of income/operations for those periods.
This pro forma financial information should be read in conjunction with the
accompanying notes and historical audited consolidated financial statements of
the Registrant included in its Annual Report on Form 10-K for year ended
December 31, 1995, the historical audited consolidated financial statements of
OWT and the unaudited condensed consolidated statement of operations for the
three months ended March 31, 1996 included herein, and the unaudited
consolidated financial statements of the Registrant included in its Quarterly
Report on Form 10-Q for the three months ended March 31, 1996. The pro forma
adjustments are based on currently available information; however, actual
adjustments will be based on management's further evaluation and estimates of
fair values. It is expected that certain of the actual adjustments will differ
from the pro forma adjustments contained herein.
The above pro forma results do not purport to reflect the actual results of
operations had the Company actually acquired OWT as of the beginning of the
periods presented.
Three months ended Twelve months ended
Statements of Operations March 31, 1996 December 31, 1995
------------------------ -------------- -----------------
(in thousands)
(1) Represents amortization expense of
purchased intangibles ................................................ $ 66 $ 408
(2) To recognize interest expense on a
$10,000,000 bank note, incurred in ................................... 128 684
conjunction with the acquisition of OWT
(3) To recognize interest income lost due to
use of cash in the purchase of OWT ................................... 34 204
(4) To reflect interest expense on notes
payable to certain OWT officers ...................................... 24 144
(5) To reflect income tax benefits due to
the above pro forma adjustments ...................................... (75) (485)
32