Exhibit 99.1
Remington Arms Company, Inc.
Reconciliation of Operating Cash Flow to Consolidated EBITDA (A)
(Dollars in Millions)
Year ended December 31,
-------------------------
(dollars in millions)
2002 2001 2000 1999 1998
------ ------ ------- ------- -------
Operating Cash Flow 21.7 50.9 22.3 65.2 60.9
Change in operating Assets and Liabilities 15.2 (20.7) 21.1 (19.0) (19.9)
Restructuring - - - - 0.7
Depreciation & Amortization (11.9) (18.6) (18.4) (17.8) (17.9)
Change in accounting principle (1.4) - - - -
Loss on PP&E (0.2) (0.4) (0.5) (0.6) (0.7)
Provision for retiree benefits (1.8) 3.0 (4.5) (0.9) (0.8)
Provision for deferred taxes (1.6) (0.5) (0.1) (3.9) (5.1)
-------- ------- -------- -------- -------
Net Income 20.0 13.7 19.9 23.0 17.2
Depreciation & Amortization (B) 10.0 16.9 16.4 16.0 15.9
Interest Expense 12.3 15.3 15.6 14.1 19.2
Provision for Income Taxes 13.9 8.5 12.5 14.7 11.1
Other noncash charges 1.0 1.1 1.2 6.2 1.1
Non-recurring charges 2.1 1.3 0.5 - (0.3)
Special Payment 1.8 - 6.9 - -
-------- ------- -------- -------- -------
Consolidated EBITDA 61.1 56.8 73.0 74.0 64.2
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Notes:
(A) "Consolidated EBITDA" as presented herein is a measure of our financial
performance that is used in the indenture for Remington's 10 1/2% Senior
Notes due 2011. As defined in the indenture, Consolidated EBITDA represents
net income adjusted to exclude income taxes, interest expense, and
depreciation and amortization, as well as items such as non-cash items,
gain or loss on asset sales or write-offs, extraordinary, unusual or
nonrecurring items, and certain "special payments" to Remington employees
who hold options and deferred shares in respect of Holding common stock,
consisting of amounts that are treated as compensation expense by Remington
and are paid in connection with payments of dividends to holders of Holding
common stock. We present Consolidated EBITDA because it is one of the
measures upon which management assesses our financial performance, and is a
measure of our financial performance that is used in the indenture for
Remington's 10 1/2% Senior Notes due 2011 to test the permissibility of
specified types of transactions. Among other provisions, Consolidated
EBITDA is used in the indenture to test whether Remington and its
subsidiaries may incur additional debt. Holders of Remington's 10 1/2%
Senior Notes due 2011 may view Consolidated EBITDA as a measure of our
ability to service debt and of our financial performance. While providing
useful information, Consolidated EBITDA should not be considered in
isolation or as a substitute for consolidated statement of operations and
cash flows data prepared in accordance with generally accepted accounting
principles and should not be construed as an indication of a company's
operating performance or as a measure of liquidity.
(B) Excludes amortization of deferred financing costs of $1.9 million, $1.7
million, $2.0 million, $1.8 million and $2.0 million in 2002, 2001, 2000,
1999 and 1998, respectively, which is included in interest expense.