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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
[X] CURRENT REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): January 16, 2001
Commission File no 000-03389
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WEIGHT WATCHERS INTERNATIONAL, INC.
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(Exact name of Registrant as specified in its charter)
Virginia 11-6040273
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
175 Crossways Park West, Woodbury, New York 11797-2055
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (516) 390-1400
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Not Applicable
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(Former name or former address, if changed since last report)
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
This current report on Form 8-K/A amends the Company's Current Report
on Form 8-K dated January 16, 2001 related to the Company's acquisition of
Weighco Enterprises, Incorporated and Subsidiaries ("Weighco") to file
historical financial statements of the business being acquired and the pro forma
statements related to this acquisition.
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(a) FINANCIAL STATEMENTS OF THE BUSINESS ACQUIRED.
Report of Independent Accountants
Consolidated Balance Sheet as of December 30, 2000
Consolidated Statement of Operations for the Year Ended December 30, 2000
Consolidated Statement of Changes in Stockholders' Equity for the Year Ended
December 30, 2000
Consolidated Statement of Cash Flows for the Year Ended December 30, 2000
Notes to Consolidated Financial Statements
(b) PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION.
The following unaudited pro forma condensed combined financial information of
the Company and Weighco is submitted herewith.
Pro Forma Condensed Combined Balance Sheet as of December 30, 2000
Pro Forma Condensed Combined Statement of Operations For the
Eight Months Period Ended December 30, 2000.
Pro Forma Condensed Combined Statement of Operations For the
Year Ended April 29, 2000.
Notes to Pro Forma Condensed Combined Financial Statements
PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION OF WEIGHT
WATCHERS INTERNATIONAL, INC. AND WEIGHCO ENTERPRISES INCORPORATED
AND SUBSIDIARIES
On January 16, 2001, the Company acquired franchised territories and
certain business assets, including inventory and property and equipment, of
Weighco Enterprises, Incorporated and Subsidiaries ("Weighco") for $83.8
million. The acquisition was financed with available cash of $23.8 million and
additional borrowings of $60.0 million. Weighco's balance sheet has been
combined with the Company's as of December 30, 2000.
The pro forma condensed combined balance sheet and statements of
operations assume the acquisition had occurred on May 1, 1999. The pro forma
condensed combined balance sheets and statements of operations do not give
effect to any synergies that might result from the acquisition of Weighco.
Accordingly, the pro forma condensed combined balance sheet and statements of
operations are not necessarily indicative of what actually would have occurred
if the acquisition had been consummated on May 1, 1999, nor are they necessarily
indicative of future combined operating results. Certain amounts included in the
Weighco historical consolidated statements of operations for the eight months
ended December 30, 2000 and for the year ended April 29, 2000 have been
reclassified to conform with the Company's presentation on the pro forma
condensed combined balance sheet and statements of operations.
The pro forma condensed combined balance sheet and statements of operations
should be read in conjunction with the historical financial statements of the
Company for the period ended December 30, 2000, filed with the Securities and
Exchange Commission on the Company's Current Report of Form 10-K dated March 30,
2001 and the historical financial statements of Weighco for the year ended
December 30, 2000, filed herein.
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WEIGHT WATCHERS INTERNATIONAL, INC. AND WEIGHCO ENTERPRISES, INCORPORATED
AND SUBSIDIARIES
PRO FORMA CONDENSED COMBINED BALANCE SHEET
AS OF DECEMBER 30, 2000
(In thousands)
(Unaudited)
WEIGHT WATCHERS PROFORMA PROFORMA
ASSETS INTERNATIONAL WEIGHCO ADJUSTMENTS COMBINED
Current assets
Cash and cash equivalents $44,501 $6,172 $(6,172) 1 $20,701
(23,800) 1
Notes and other receivables, current 22,148 25 2,695 2 24,868
Inventories 15,044 2,139 17,183
Prepaid expenses 11,099 970 (493) 1 11,576
Deferred income tax 648 648
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Total current assets 93,440 9,306 (27,770) 74,976
Property and equipment, net 8,145 1,554 9,699
Goodwill, net 150,901 80,805 1 231,706
Trademarks and other intangible assets, net 6,648 35,647 (35,647) 1 6,648
Deferred income taxes 67,207 67,207
Other noncurrent assets 20,454 707 (707) 1 20,454
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Total assets $346,795 $47,214 $16,681 $410,690
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LIABILITIES, REDEEMABLE PREFERRED STOCK AND
PARENT COMPANY'S INVESTMENT/ STOCKHOLDERS' DEFICIT
Current liabilities
Portion of long-term debt due within one year $ 15,850 $ 4,080 $ (4,080) 1 $ 15,850
Accounts payable, other 38,918 2,502 (2,502) 1 38,918
Other accrued liabilities 23,215 7,455 (7,455) 1 23,215
Deferred revenue 5,836 2,695 8,531
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Total current liabilities 83,819 16,732 (14,037) 86,514
Long-term debt 456,530 21,203 (21,203) 1 516,530
60,000 1
Deferred income taxes 3,107 3,107
Other 121 1,200 1 1,321
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Total long-term debt and other liabilities 459,758 21,203 39,997 520,958
Redeemable preferred stock 25,996 25,996
Stockholders' deficit -
Common stock 6 (6) 1 -
Additional paid-in capital 3,108 (3,108) 1 -
Treasury Stock (2) 2 1 -
Accumulated (deficit) equity (216,507) 6,167 (6,167) 1 (216,507)
Accumulated other comprehensive loss (6,271) (6,271)
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Tota stockholders' (deficit)/equity (222,778) 9,279 (9,279) (222,778)
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Total liabilities, redeemable preferred stock,
and stockholders' deficit $346,795 $47,214 $16,681 $410,690
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See Notes to Pro Forma Condensed Combined Financial Statements
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WEIGHT WATCHERS INTERNATIONAL, INC. AND WEIGHCO ENTERPRISES, INCORPORATED
AND SUBSIDIARIES
PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED APRIL 29, 2000
(In thousands)
(Unaudited)
WEIGHT WATCHERS PROFORMA PROFORMA
INTERNATIONAL WEIGHCO ADJUSTMENTS COMBINED
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Revenues, net $399,574 $44,949 $(7,998) 6 $436,525
Cost of revenues 201,389 23,443 (7,998) 6 216,834
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Gross profit 198,185 21,506 - 219,691
Marketing expenses 51,453 3,452 54,905
Selling, general and administrative expenses 50,743 11,244 4,190 3 60,539
(5,638) 7
Transaction costs 8,345 - 8,345
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Operating income 87,644 6,810 1,448 95,902
Interest income 5,792 225 (1,309) 5 4,708
Interest expense 36,871 2,175 5,700 4 44,746
Other (income) expense, net (10,351) (86) (10,437)
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Income before income taxes and minority interest 66,916 4,946 (5,561) 66,301
Provision for income taxes 28,323 1,830 (2,336) 8 27,817
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Income before minority interest 38,593 3,116 (3,225) 38,484
Minority interest 834 - 834
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Net income $37,759 $3,116 $(3,225) $37,650
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See Notes to Pro Forma Condensed Combined Financial Statements
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WEIGHT WATCHERS INTERNATIONAL, INC. AND WEIGHCO ENTERPRISES, INCORPORATED
AND SUBSIDIARIES
PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE EIGHT MONTH PERIOD ENDED DECEMBER 30, 2000
(In thousands)
(Unaudited)
WEIGHT WATCHERS PROFORMA PROFORMA
INTERNATIONAL WEIGHCO ADJUSTMENTS COMBINED
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Revenues, net $273,175 $39,916 $(6,582) 6 $306,509
Cost of revenues 139,283 20,967 (6,582) 6 153,668
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Gross profit 133,892 18,949 - 152,841
Marketing expenses 26,986 2,049 29,035
Selling, general and administrative expenses 32,222 9,628 2,793 3 39,784
(4,859) 7
Transaction costs - -
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Operating income 74,684 7,272 2,066 84,022
Interest income 3,119 145 (873) 5 2,391
Interest expense 40,244 1,692 3,800 4 45,736
Other (income) expense, net 16,536 9,002 (8,584) 7 16,954
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Income before income taxes and minority interest 21,023 (3,277) 5,977 23,723
Provision for income taxes 5,857 (1,212) 1,674 8 6,319
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Income before minority interest 15,166 (2,065) 4,303 17,404
Minority interest 147 147
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Net income $15,019 $(2,065) $4,303 $17,257
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See Notes to Pro Forma Condensed Combined Financial Statements
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WEIGHT WATCHERS INTERNATIONAL, INC AND WEIGHCO ENTERPRISES,
INCORPORATED AND SUBSIDIARIES
NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
FOR THE EIGHT MONTH PERIOD ENDED DECEMBER 30, 2000 AND THE YEAR
ENDED APRIL 29, 2000
(Unaudited)
The pro forma condensed combined balance sheet and statements of operations
assume that the acquisition of Weighco occurred at December 20, 2000, and at
the beginning of the periods presented, respectively. The pro forma condensed
combined balance sheet and statements of operations do not give any effect to
the synergies that might result from the acquisition of Weighco's operations.
Accordingly, the pro forma results are not indicative of what would have
occurred if the acquisition had been consummated on May 1, 1999, nor are they
necessarily indicative of future combined results.
The following is a summary of the estimated adjustments, based upon available
information and upon certain assumptions that management believes are
reasonable, that are reflected in the pro forma condensed combined statements of
operations.
(1) Represents the acquisition of inventory, property and equipment and other
assets and the elimination of non-assumed liabilities for $83.8 million, which
was financed with $23.8 million of existing cash and additional borrowings of
$60.0 million. The excess of the total purchase price over assets acquired and
liabilities assumed has been recorded as goodwill.
(2) Represents a receivable due to the Company from Weighco for the assumption
of deferred revenue.
December 30 April 29
2000 2000
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(3) Represents the amortization of acquisition goodwill of $80.8 million $ 2,793 $ 4,190
over 20 years utilizing the straight-line method.
(4) Acquisition borrowings of $60 million at an average interest $ 3,800 $ 5,700
rate of 9.5%.
(5) Cash used to fund acquisition of $23.8 million at 5.5%. $ 873 $ 1,309
(6) Represents the elimination of royalty revenue $ 6,582 $ 7,998
and expense and products sales to Weighco.
(7) The elimination of non-recurring costs and charges incurred by Weighco
relating to the sale to Weight Watchers:
General & Administrative Expenses $ 4,859 $ 5,638
Other (Income) Expense $ 8,584
(8) Recognition of income taxes at 28% of the pre-tax income $ 1,674 $(2,336)
for the eight months ended December 30, 2000 and 42% for the year
ended April 29, 2000.
(c) EXHIBITS
(i) Exhibit 99 (a): Weighco Consolidated Balance Sheet as of December 30, 2000,
Consolidated Statement of Operations For the Year Ended December 30, 2000,
Consolidated Statement of Changes in Stockholders' Equity For the Year Ended
December 30, 2000, Consolidated Statement of Cash Flows and Report of
PricewaterhouseCoopers LLP, Independent Accountants.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
Date: March 30, 2001
By: /s/ LINDA HUETT
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Linda Huett
President and Director
(Principal Executive Officer)
Date: March 30, 2001
By: /s/ THOMAS S. KIRITSIS
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Thomas S. Kiritsis
Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
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