Enerpac Tool Group Corp. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Guarantor Subsidiaries

Guarantor Subsidiaries

12 Months Ended

Aug. 31, 2011

Note 18. Guarantor Subsidiaries

On June 12, 2007, Actuant Corporation (the "Parent") issued $250.0 million of 6.875% Senior Notes. All of our material domestic wholly owned subsidiaries (the "Guarantors") fully and unconditionally guarantee (except for certain customary limitations) the 6.875% Senior Notes on a joint and several basis. There are no significant restrictions on the ability of the Guarantors to make distributions to the Parent. The following tables present the results of operations, financial position and cash flows of Actuant Corporation and its subsidiaries, the Guarantor and non-Guarantor entities, and the eliminations necessary to arrive at the information for the Company on a consolidated basis.

Certain assets, liabilities and expenses have not been allocated to the Guarantors and non-Guarantors and therefore are included in the Parent column in the accompanying consolidating financial statements. These items are of a corporate or consolidated nature and include, but are not limited to, tax provisions and related assets and liabilities, certain employee benefit obligations, prepaid and accrued insurance and corporate indebtedness. Intercompany activity in the consolidating financial statements primarily includes loan activity, purchases and sales of goods or services and dividends. Intercompany balances also reflect certain non-cash transactions including transfers of assets and liabilities between the Parent, Guarantor and non-Guarantor, allocation of non-cash expenses from the Parent to the Guarantors and non-Guarantors, the impact of foreign currency rate changes and non-cash intercompany dividends.

CONDENSED CONSOLIDATING STATEMENTS OF EARNINGS

(In thousands)


	Year Ended August 31, 2011
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	170,094		$	523,294		$	751,935		$	—		$	1,445,323
Cost of products sold		55,290			365,431			468,703			—			889,424

Gross profit		114,804			157,863			283,232			—			555,899
Selling, administrative and engineering expenses		89,682			96,313			146,644			—			332,639
Restructuring charges		1,546			218			459			—			2,223
Amortization of intangible assets		335			14,931			12,201			—			27,467

Operating profit		23,241			46,401			123,928			—			193,570
Financing costs, net		31,912			(1	)		208			—			32,119
Intercompany expense (income), net		(16,924	)		14,670			2,254			—			—
Other expense (income), net		(4,519	)		133			6,630			—			2,244

Earnings from continuing operations before income taxes		12,772			31,599			114,836			—			159,207
Income tax expense		2,873			6,948			24,890			—			34,711

Net earnings from continuing operations before equity in earnings of subsidiaries		9,899			24,651			89,946			—			124,496
Equity in earnings of subsidiaries		112,364			77,395			6,261			(196,020	)		—

Earnings from continuing operations		122,263			102,046			96,207			(196,020	)		124,496
Loss from discontinued operations		(10,704	)		—			(2,233	)		—			(12,937	)

Net Earnings	$	111,559		$	102,046		$	93,974		$	(196,020	)	$	111,559


	Year Ended August 31, 2010
	Parent			Guarantors		Non-Guarantors			Eliminations			Consolidated
Net sales	$	143,783		$	456,961	$	559,764		$	—		$	1,160,508
Cost of products sold		47,370			333,829		352,057			—			733,256

Gross profit		96,413			123,132		207,707			—			427,252
Selling, administrative and engineering expenses		75,814			87,987		104,065			—			267,866
Restructuring charges		2,054			7,418		6,125			—			15,597
Amortization of intangible assets		—			14,463		7,554			—			22,017

Operating profit		18,545			13,264		89,963			—			121,772
Financing costs, net		31,589			17		253			—			31,859
Intercompany expense (income), net		(21,388	)		2,610		18,778			—			—
Other expense (income), net		(55	)		1,613		(847	)		—			711

Earnings from continuing operations before income taxes		8,399			9,024		71,779			—			89,202
Income tax expense		2,930			2,355		13,561			—			18,846

Net earnings from continuing operations before equity in earnings (loss) of subsidiaries		5,469			6,669		58,218			—			70,356
Equity in earnings (loss) of subsidiaries		18,562			2,011		(3,920	)		(16,653	)		—

Earnings from continuing operations		24,031			8,680		54,298			(16,653	)		70,356
Loss from discontinued operations		—			—		(46,325	)		—			(46,325	)

Net Earnings	$	24,031		$	8,680	$	7,973		$	(16,653	)	$	24,031


	Year Ended August 31, 2009
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	139,389		$	466,415		$	511,821		$	—		$	1,117,625
Cost of products sold		52,949			337,903			338,546			—			729,398

Gross profit		86,440			128,512			173,275			—			388,227
Selling, administrative and engineering expenses		54,189			90,944			104,871			—			250,004
Restructuring charges		2,408			10,026			7,096			—			19,530
Impairment charges		—			28,543			2,778						31,321
Amortization of intangible assets		—			13,881			5,763			—			19,644

Operating profit (loss)		29,843			(14,882	)		52,767			—			67,728
Financing costs, net		41,025			141			683			—			41,849
Intercompany expense (income), net		(15,797	)		(1,942	)		17,739			—			—
Other income, net		(194	)		(435	)		(85	)		—			(714	)

Earnings (loss) from continuing operations before income taxes		4,809			(12,646	)		34,430			—			26,593
Income tax expense (benefit)		4,117			(8,872	)		5,366			—			611

Net earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries		692			(3,774	)		29,064			—			25,982
Equity in earnings (loss) of subsidiaries		398			26,286			(7,678	)		(19,006	)		—

Earnings from continuing operations		1,090			22,512			21,386			(19,006	)		25,982
Earnings (loss) from discontinued operations		12,633			1,643			(26,535	)		—			(12,259	)

Net Earnings (loss)	$	13,723		$	24,155		$	(5,149	)	$	(19,006	)	$	13,723

CONDENSED CONSOLIDATING BALANCE SHEETS

(In thousands)


	August 31, 2011
	Parent		Guarantors		Non-Guarantors		Eliminations			Consolidated
ASSETS
Current Assets	$	87,982	$	155,067	$	303,435	$	—			546,484
Property, Plant & Equipment, net		4,327		37,133		87,189		—			128,649
Goodwill		62,543		432,184		393,739		—			888,466
Other Intangibles, net		15,861		216,277		247,268		—			479,406
Intercompany Receivable		—		277,157		45,770		(322,927	)		—
Investment in Subsidiaries		1,859,779		379,170		67,794		(2,306,743	)		—
Other Long-term assets		10,862		51		2,763		—			13,676

Total Assets	$	2,041,354	$	1,497,039	$	1,147,958	$	(2,629,670	)	$	2,056,681

LIABILITIES & SHAREHOLDERS' EQUITY
Current Liabilities	$	76,300	$	70,126	$	183,877	$	—		$	330,303
Long-term Debt		522,727		—		—		—			522,727
Deferred Income Taxes		124,469		—		41,476		—			165,945
Pension and Post-retirement Benefit Liabilities		16,452		—		2,412		—			18,864
Other Long-term Liabilities		59,466		779		39,584		—			99,829
Intercompany Payable		322,927		—		—		(322,927	)		—
Shareholders' Equity		919,013		1,426,134		880,609		(2,306,743	)		919,013

Total Liabilities and Shareholders' Equity	$	2,041,354	$	1,497,039	$	1,147,958	$	(2,629,670	)	$	2,056,681


	August 31, 2010
	Parent		Guarantors		Non-Guarantors			Eliminations			Consolidated
ASSETS
Current Assets	$	78,548	$	134,552	$	247,050		$	—		$	460,150
Property, Plant & Equipment, net		5,166		41,226		61,990			—			108,382
Goodwill		68,969		417,914		218,006			—			704,889
Other Intangibles, net		—		242,310		94,668			—			336,978
Intercompany Receivable		—		227,792		212,847			(440,639	)		—
Investment in Subsidiaries		1,511,103		319,196		115,846			(1,946,145	)		—
Other Long-term assets		8,421		130		2,753			—			11,304

Total Assets	$	1,672,207	$	1,383,120	$	953,160		$	(2,386,784	)	$	1,621,703

LIABILITIES & SHAREHOLDERS' EQUITY
Current Liabilities	$	70,417	$	60,983	$	182,022		$	—		$	313,422
Long-term Debt		367,380		—		—			—			367,380
Deferred Income Taxes		84,694		—		25,536			—			110,230
Pension and Post-retirement Benefit Liabilities		27,144		972		(44	)		—			28,072
Other Long-term Liabilities		52,672		766		9,440			—			62,878
Intercompany Payable		330,179		—		110,460			(440,639	)		—
Shareholders' Equity		739,721		1,320,399		625,746			(1,946,145	)		739,721

Total Liabilities and Shareholders' Equity	$	1,672,207	$	1,383,120	$	953,160		$	(2,386,784	)	$	1,621,703

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(In thousands)


	Year Ended August 31, 2011
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating Activities
Net cash provided by operating activities	$	92,573		$	3,122		$	77,404		$	(1,533	)	$	171,566

Investing Activities
Proceeds from sale of property, plant & equipment		103			313			1,363			—			1,779
Proceeds from sale of businesses		—			—			3,463			—			3,463
Capital expenditures		(5,284	)		(4,740	)		(13,072	)		—			(23,096	)
Business acquisitions, net of cash acquired		(153,409	)		(350	)		(159,697	)		—			(313,456	)

Cash used in investing activities		(158,590	)		(4,777	)		(167,943	)		—			(331,310	)

Financing Activities
Net borrowings on revolver and other debt		58,000			—			204			—			58,204
Proceeds from issuance of term loans		100,000			—			—			—			100,000
Repurchases of 2% Convertible Notes		(34	)		—			—			—			(34	)
Intercompany loan activity		(96,454	)		1,655			94,799			—			—
Debt issuance costs		(5,197	)		—			—			—			(5,197	)
Stock option exercises, related tax benefits and other		8,235			—			—			—			8,235
Cash dividend		(2,716	)		—			(1,533	)		1,533			(2,716	)

Cash provided by financing activities		61,834			1,655			93,470			1,533			158,492
Effect of exchange rate changes on cash		—			—			5,251			—			5,251

Net increase (decrease) in cash and cash equivalents		(4,183	)		—			8,182			—			3,999
Cash and cash equivalents—beginning of period		5,055			—			35,167			—			40,222

Cash and cash equivalents—end of period	$	872		$	—		$	43,349		$	—		$	44,221


	Year Ended August 31, 2010
	Parent			Guarantors			Non- Guarantors			Eliminations			Consolidated
Operating Activities
Net cash provided by (used in) operating activities	$	137,143		$	(6,739	)	$	42,827		$	(52,145	)	$	121,086

Investing Activities
Proceeds from sale of property, plant & equipment		1			439			796			—			1,236
Proceeds from sale of businesses		—			—			7,516			—			7,516
Capital expenditures		(1,219	)		(8,309	)		(10,438	)		—			(19,966	)
Business acquisitions, net of cash acquired		—			(9,374	)		(36,492	)		—			(45,866	)

Cash used in investing activities		(1,218	)		(17,244	)		(38,618	)		—			(57,080	)

Financing Activities
Net repayments on revolver and other debt		(12,608	)		—			(1,705	)		—			(14,313	)
Repurchases of 2% Convertible Notes		(22,894	)		—			—			—			(22,894	)
Intercompany loan activity		(96,107	)		55,378			40,729			—			—
Stock option exercises, related tax benefits and other		3,315			—			—			—			3,315
Cash dividend		(2,702	)		(31,395	)		(20,750	)		52,145			(2,702	)

Cash provided by (used in) financing activities		(130,996	)		23,983			18,274			52,145			(36,594	)
Effect of exchange rate changes on cash		—			—			1,425			—			1,425

Net increase in cash and cash equivalents		4,929			—			23,908			—			28,837
Cash and cash equivalents—beginning of period		126			—			11,259			—			11,385

Cash and cash equivalents—end of period	$	5,055		$	—		$	35,167		$	—		$	40,222


	Year Ended August 31, 2009
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating Activities
Net cash provided by operating activities	$	82,428		$	22,960		$	85,163		$	(43,836	)	$	146,715

Investing Activities
Proceeds from sale of property, plant & equipment		—			512			1,350			—			1,862
Proceeds from sale of businesses		38,455			—			—			—			38,455
Capital expenditures		(489	)		(5,275	)		(15,690	)		—			(21,454	)
Business acquisitions, net of cash acquired		(234,600	)		(3,066	)		(1,756	)		—			(239,422	)

Cash used in investing activities		(196,634	)		(7,829	)		(16,096	)		—			(220,559	)

Financing Activities
Net borrowings on revolver and other debt		15,325			—			1,332			—			16,657
Principal repayments on term loans and other debt		(270,000	)		—			—			—			(270,000	)
Proceeds from issuance of term loans		115,000			—			—			—			115,000
Repurchases of 2% Convertible Notes		(9,100	)		—			—			—			(9,100	)
Intercompany loan activity		102,579			15,357			(117,936	)		—			—
Debt issuance costs		(9,158	)		—			—			—			(9,158	)
Proceeds from equity offering, net of transaction costs		124,781			—			—			—			124,781
Stock option exercises, related tax benefits and other		4,024			—			—			—			4,024
Cash dividend		(2,251	)		(30,701	)		(13,135	)		43,836			(2,251	)

Cash provided by financing activities		71,200			(15,344	)		(129,739	)		43,836			(30,047	)
Effect of exchange rate changes on cash		—			—			(7,273	)		—			(7,273	)

Net increase in cash and cash equivalents		(43,006	)		(213	)		(67,945	)		—			(111,164	)
Cash and cash equivalents—beginning of period		43,132			213			79,204			—			122,549

Cash and cash equivalents—end of period	$	126		$	—		$	11,259		$	—		$	11,385