Exhibit 99.2
VALCOR, INC. AND SUBSIDIARIES
INDEX TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Page
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Pro Forma Condensed Consolidated Balance Sheet - December 31, 1996 F-2/F-3
Notes to Pro Forma Condensed Consolidated Balance Sheet F-4/F-5
Pro Forma Condensed Consolidated Statement of Income -
Year ended December 31, 1996 F-6
Notes to Pro Forma Condensed Consolidated Statement of Income F-7
These pro forma condensed consolidated financial statements should be read in
conjunction with the historical consolidated financial statements of Valcor,
Inc. The pro forma condensed consolidated financial statements are not
necessarily indicative of Valcor's consolidated financial position or results
of continuing operations as they may be in the future.
VALCOR, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
December 31, 1996
(Unaudited)
(In millions)
Pro forma adjustments
Valcor -------------------------
ASSETS Historical (I) (II) Pro forma
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Current assets:
Cash and cash equivalents $136.1 ($1.1) $73.6 $208.6
Accounts and notes receivable 15.7 - - 15.7
Inventories 18.2 - (1.5) 16.7
Prepaid expenses 2.7 - (1.0) 1.7
Deferred income taxes 5.1 - (1.2) 3.9
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177.8 (1.1) 69.9 246.6
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Other assets:
Goodwill 5.0 - (5.0) -
Other intangible assets 11.3 - (10.9) 0.4
Other assets 7.0 - (0.1) 6.9
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23.3 - (16.0) 7.3
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Property and equipment, net 87.9 - (52.8) 35.1
----------- ----------- ----------- ----------
$289.0 ($1.1) $1.1 $289.0
=========== =========== =========== ==========
VALCOR, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (CONTINUED)
December 31, 1996
(Unaudited)
(In millions)
Pro forma adjustments
Valcor -------------------------
LIABILITIES AND STOCKHOLDER'S EQUITY Historical (I) (II) Pro forma
----------- ----------- ----------- ----------
Current liabilities:
Current long-term debt $1.2 $ - ($0.9) $0.3
Accounts payable & accrued liabilities 70.8 - (13.6) 57.2
Income taxes 1.1 - - 1.1
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73.1 - (14.5) 58.6
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Noncurrent liabilities:
Long-term debt 108.5 (1.1) (3.6) 103.8
Deferred income taxes 8.7 - - 8.7
Other 4.3 - (1.3) 3.0
----------- ----------- ----------- ----------
121.5 (1.1) (4.9) 115.5
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Stockholder's equity:
Common stock and paid-in capital 0.5 - 20.5 21.0
Retained earnings 96.5 - - 96.5
Adjustments:
Pension liabilities (2.5) - - (2.5)
Foreign currency translation (0.1) - - (0.1)
----------- ----------- ----------- ----------
94.4 - 20.5 114.9
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$289.0 ($1.1) $1.1 $289.0
=========== =========== =========== ==========
See accompanying notes to pro forma condensed consolidated balance sheet.
VALCOR, INC. AND SUBSIDIARIES
NOTES TO PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
Note 1 - Basis of presentation:
The Pro Forma Condensed Consolidated Balance Sheet assumes the following
transactions, more fully described in Item 2 of this Current Report on Form
8-K dated April 30, 1997, occurred on December 31, 1996:
I - Sybra increases its intercompany loan from Valcor by $3.8 million
(bringing its total intercompany loan from Valcor to $23.8 million)
and repays all of its outstanding bank indebtedness ($1.1 million).
II - Sybra sells certain restaurant real estate to U.S. Resaturant
Properties Master L.P., Valcor sells 100% of the common stock of
Sybra to I.C.H. Corporation and I.C.H. repays $23.8 million of
intercompany indebtedness owed to Valcor by Sybra.
Note 2 - Pro forma adjustments:
I - Reflect Sybra's borrowing $3.8 million from Valcor and repaying $1.1
million of bank indebtedness.
VALCOR, INC. AND SUBSIDIARIES
NOTES TO PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (CONTINUED)
(Unaudited)
II - Reflect Sybra's sale of certain restaurant real estate to U.S.
Restaurant Properties Master L.P., Valcor's sale of 100% of the
common stock of Sybra to I.C.H. Corporation and I.C.H.'s repayment of
$23.8 million of intercompany indebtedness owed to Valcor by Sybra,
as follows: Amount
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(In millions)
Aggregate cash consideration (including repayment of intercompany
indebtedness owed to Valcor), net of estimated fees and expenses $81.0
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Carrying value of assets sold and liabilities assumed:
Cash and equivalents 4.0
Inventories 1.5
Prepaid expenses 1.0
Current deferred income taxes 1.2
Goodwill 5.0
Other intangible assets 10.9
Other assets 0.1
Net property, plant and equipment 52.8
Accounts payable & accrued liabilities (13.6)
Long-term debt and capital lease
obligations, including current portion (4.5)
Noncurrent deferred income taxes (0.3)
Other noncurrent liabilities (1.3)
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56.8
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Pre-tax gain 24.2
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Income tax expense:
Current income taxes 3.4
Deferred income taxes 0.3
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3.7
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Net-of-tax gain $20.5
============
The overall effective income tax rate applicable to the pre-tax gain
varies from the 35% statutory federal income tax rate due principally
to the excess of tax basis over book basis of the common stock of
Sybra sold for which no deferred income tax benefit was previously
recognized.
VALCOR, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
Year ended December 31, 1996
(Unaudited)
(In millions)
Pro forma
Valcor adjustments
Historical (I) Pro forma
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Revenues and other income:
Net sales $204.7 ($116.0)(a) $88.7
Other, net 2.2 (0.1)(a)
0.6 (b) 2.7
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206.9 (115.5) 91.4
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Costs and expenses:
Cost of goods sold 159.3 (101.0)(a) 58.3
Selling, general and administrative 15.4 (6.2)(a) 9.2
Interest 11.7 (2.3)(a)
0.6 (b) 10.0
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186.4 (108.9) 77.5
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Income before income taxes 20.5 (6.6) 13.9
Provision for income taxes 8.5 (2.4)(a) 6.1
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Income from continuing operations $12.0 ($4.2) $7.8
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See accompanying notes to pro forma condensed consolidated statement of income.
VALCOR, INC. AND SUBSIDIARIES
NOTES TO PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
Note 1 - Basis of presentation:
The Pro Forma Condensed Consolidated Statement of Income assumes the
disposition of the Company's fast food operations, more fully described in
Item 2 of this Current Report on Form 8-K dated April 30, 1997, occurred as
of the beginning of 1996.
Note 2 - Pro forma adjustments:
(a) Eliminate Sybra's historical results of operations included in Valcor's
consolidated statement of income. In future filings, Valcor will report
Sybra's results of operations through the date of disposal as
discontinued operations.
(b) Reclassification.