EXHIBIT 99.1
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IONICS, INCORPORATED
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED FINANCIAL INFORMATION
The following unaudited pro forma consolidated condensed financial information
gives effect on a pro forma basis to (i) the disposition of Ionics,
Incorporated's Aqua Cool Pure Bottled Water business, as disclosed in Item 2 of
this Current Report on Form 8-K, principally by deducting the financial position
and results of operations of that business from the historical consolidated
financial position and results of operations of Ionics, and (ii) the use of a
portion of the proceeds from the disposition to repay outstanding indebtedness.
The unaudited pro forma consolidated condensed balance sheet gives effect to
these transactions as if they had occurred on September 30, 2001. Each of the
unaudited pro forma consolidated condensed statements of operations gives effect
to these transactions as if they had occurred at the beginning of the periods
presented. The unaudited pro forma consolidated condensed financial information
has been prepared by Ionics based upon assumptions and adjustments it has deemed
appropriate, as discussed in the accompanying Notes to Unaudited Pro Forma
Consolidated Condensed Financial Information.
The pro forma financial information does not purport to represent what Ionics'
consolidated results of operations would have been if the disposition of the
Aqua Cool Pure Bottled Water business had in fact occurred on these dates, nor
does it indicate the future consolidated financial position or future
consolidated results of operations of Ionics. This unaudited pro forma
consolidated condensed financial information should be read in conjunction with
Ionics' consolidated financial statements and notes thereto included in Ionics'
Annual Report on Form 10-K for the year ended December 31, 2000 and Quarterly
Report on Form 10-Q for the quarterly period ended September 30, 2001.
Future consolidated financial statements of Ionics will reflect the disposal of
the assets and liabilities of the Aqua Cool Pure Bottled Water business as of
the date of disposition, but will continue to reflect the assets, liabilities
and results of the Aqua Cool Pure Bottled Water business for the periods prior
to the date of disposition.
Ionics, Incorporated
Unaudited Pro Forma Consolidated Condensed Balance Sheet
September 30, 2001
(Amounts in Thousands)
PRO FORMA OTHER
ADJUSTMENTS PRO FORMA
HISTORICAL FOR SALE ADJUSTMENTS PRO FORMA
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Current assets:
Cash and cash equivalents $ 23,025 $ $ 136,134 a,b $ 159,159
Short-term investments 602 602
Notes receivable, current 5,082 5,082
Billed receivables 104,662 (18,729) 85,933
Unbilled receivables 51,484 51,484
Receivables from affiliated companies 1,640 1,640
Inventories 43,418 (1,759) 41,659
Other current assets 17,144 (1,479) 15,665
Deferred income taxes 12,749 12,749
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Total current assets 259,806 (21,967) 136,134 373,973
Long-term notes receivable 22,945 22,945
Investments in affiliated companies 24,894 24,894
Property, plant and equipment, net 221,910 (53,981) 167,929
Other assets 57,389 (21,987) 35,402
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Total assets $ 586,944 $ (97,935) $ 136,134 $ 625,143
========= ========= ========= =========
Current liabilities:
Notes payable and current portion of long-term debt $ 60,995 $ $ (60,995)b $
Accounts payable 41,002 (5,452) 35,550
Other current liabilities 44,821 (2,427) 42,394
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Total current liabilities 146,818 (7,879) (60,995) 77,944
Long-term debt and notes payable 10,427 (56) (10,371)b
Deferred income taxes 30,962 49 31,011
Other liabilities 6,088 (95) 5,993
Stockholders' equity 392,649 (89,954) 207,500 510,195
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Total liabilities and stockholders' equity $ 586,944 $ (97,935) $ 136,134 $ 625,143
========= ========= ========= =========
See Notes to Unaudited Pro Forma Consolidated Condensed Financial Information
Ionics, Incorporated
Unaudited Pro Forma Consolidated Condensed Statement of Operations
For the Nine Months Ended September 30, 2001
(Amounts in thousands, except per share amounts)
PRO FORMA OTHER
ADJUSTMENTS PRO FORMA
HISTORICAL FOR SALE ADJUSTMENTS PRO FORMA
--------- --------- --------- ---------
Revenues $ 354,929 $ (57,627) $ 297,302
Cost of sales 250,440 (30,336) 220,104
Research and development expenses 4,795 4,795
Selling, general and administrative expenses 81,736 (20,588) 61,148
--------- --------- --------- ---------
Income from operations 17,958 (6,703) 11,255
Interest income 1,147 1,147
Interest expense (4,273) 5 4,268 c
Equity income 1,906 1,906
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Income before income taxes and minority interest 16,738 (6,698) 4,268 14,308
Provision for income taxes (5,691) 2,277 (1,451) (4,865)
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Income before minority interest 11,047 (4,421) 2,817 9,443
Minority interest in losses 328 328
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Net income $ 11,375 $ (4,421) $ 2,817 $ 9,771
========= ========= ========= =========
Earnings per basic share $ 0.67 $ 0.58
========= =========
Earnings per diluted share $ 0.66 $ 0.57
========= =========
Shares used in basic earnings per share calculations 16,983 16,983
========= =========
Shares used in diluted earnings per share calculations 17,132 17,132
========= =========
See Notes to Unaudited Pro Forma Consolidated Condensed Financial Information
Ionics, Incorporated
Unaudited Pro Forma Consolidated Condensed Statement of Operations
For the Year Ended December 31, 2000
(Amounts in thousands, except per share amounts)
PRO FORMA OTHER
ADJUSTMENTS PRO FORMA
HISTORICAL FOR SALE ADJUSTMENTS PRO FORMA
--------- --------- --------- ---------
Revenues $ 474,551 $ (67,206) $ 407,345
Cost of sales 350,175 (40,085) 310,090
Research and development expenses 7,980 7,980
Selling, general and administrative expenses 116,620 (26,292) 90,328
--------- --------- --------- ---------
Loss from operations (224) (829) (1,053)
Interest income 1,286 (2) 1,284
Interest expense (4,909) 36 4,873 c
Equity income 1,623 1,623
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(Loss) Income before income taxes and minority interest (2,224) (795) 4,873 1,854
Benefit (Provision) for income taxes 756 270 (1,657) (631)
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(Loss) Income before minority interest (1,468) (525) 3,216 1,223
Minority interest in earnings 402 402
--------- --------- --------- ---------
Net (Loss) Income $ (1,870) $ (525) $ 3,216 $ 821
========= ========= ========= =========
Earnings per basic share $ (0.12) $ 0.05
========= =========
Earnings per diluted share $ (0.12) $ 0.05
========= =========
Shares used in basic earnings per share calculations 16,243 16,243
========= =========
Shares used in diluted earnings per share calculations 16,243 16,418
========= =========
See Notes to Unaudited Pro Forma Consolidated Condensed Financial Information
Ionics, Incorporated
Notes to Unaudited Pro Forma Consolidated Condensed Financial Information
The unaudited pro forma consolidated condensed financial information reflects:
a) the receipt of gross transaction proceeds of $210 million (which
excludes $10 million held in escrow) after deducting estimated
transaction costs;
b) the repayment of approximately $71.4 million in notes payable and
long-term debt; and
c) the elimination of interest expense resulting from the repayment of
notes payable and long-term debt.
The unaudited pro forma consolidated condensed financial information does not
reflect:
1) additional investment earnings relating to the balance of the net
proceeds after repayment of the notes payable and long-term debt;
2) potential purchase price adjustments which may be made pursuant to the
Master Agreement following the closing date; or
3) the elimination of certain corporate general and administrative
expenses historically allocated to Aqua Cool Pure Bottled Water
business.