Enerpac Tool Group Corp. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Guarantor Subsidiaries

Guarantor Subsidiaries

6 Months Ended

Feb. 29, 2012

Note 14. Guarantor Subsidiaries

On June 12, 2007, Actuant Corporation (the "Parent") issued $250.0 million of 6.875% Senior Notes. All of the Company's 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)


	Three Months Ended February 29, 2012
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	49,514		$	137,431		$	191,079		$	—		$	378,024
Cost of products sold		17,114			97,651			121,967			—			236,732

Gross profit		32,400			39,780			69,112			—			141,292
Selling, administrative and engineering expenses		19,660			26,612			38,491			—			84,763
Amortization of intangible assets		335			3,411			3,327			—			7,073

Operating profit		12,405			9,757			27,294			—			49,456
Financing costs, net		8,035			5			(219	)		—			7,821
Intercompany expense (income), net		(8,682	)		1,733			6,949			—			—
Other expense (income), net		822			1,330			(2,323	)		—			(171	)

Earnings before income tax expense		12,230			6,689			22,887			—			41,806
Income tax expense		2,818			1,541			5,272			—			9,631

Net earnings before equity in earnings of subsidiaries		9,412			5,148			17,615			—			32,175
Equity in earnings of subsidiaries		22,763			17,819			1,926			(42,508	)		—

Net earnings	$	32,175		$	22,967		$	19,541		$	(42,508	)	$	32,175


	Three Months Ended February 28, 2011
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	37,936		$	123,185		$	169,577		$	—		$	330,698
Cost of products sold		11,509			85,833			108,329			—			205,671

Gross profit		26,427			37,352			61,248			—			125,027
Selling, administrative and engineering expenses		20,014			24,209			36,872			—			81,095
Amortization of intangible assets		—			3,782			3,104			—			6,886

Operating profit		6,413			9,361			21,272			—			37,046
Financing costs, net		8,238			—			—			—			8,238
Intercompany expense (income), net		(9,313	)		3,602			5,711			—			—
Other expense (income), net		(383	)		(436	)		1,316			—			497

Earnings from continuing operations before income tax expense		7,871			6,195			14,245			—			28,311
Income tax expense		1,715			1,350			3,104			—			6,169

Net earnings from continuing operations before equity in earnings of subsidiaries		6,156			4,845			11,141			—			22,142
Equity in earnings of subsidiaries		15,653			10,149			855			(26,657	)		—

Earnings from continuing operations		21,809			14,994			11,996			(26,657	)		22,142
Loss from discontinued operations, net of income taxes		(13,880	)		—			(333	)		—			(14,213	)

Net earnings	$	7,929		$	14,994		$	11,663		$	(26,657	)	$	7,929

CONDENSED CONSOLIDATING STATEMENTS OF EARNINGS

(In thousands)


	Six Months Ended February 29, 2012
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	98,034		$	273,872		$	398,917		$	—		$	770,823
Cost of products sold		32,393			192,283			252,247			—			476,923

Gross profit		65,641			81,589			146,670			—			293,900
Selling, administrative and engineering expenses		40,326			52,874			79,672			—			172,872
Amortization of intangible assets		670			6,831			6,790			—			14,291

Operating profit		24,645			21,884			60,208			—			106,737
Financing costs, net		16,272			8			(237	)		—			16,043
Intercompany expense (income), net		(16,173	)		2,299			13,874			—			—
Other expense (income), net		1,015			1,674			(2,203	)		—			486

Earnings before income tax expense		23,531			17,903			48,774			—			90,208
Income tax expense		5,440			4,142			11,277			—			20,859

Net earnings before equity in earnings of subsidiaries		18,091			13,761			37,497			—			69,349
Equity in earnings of subsidiaries		51,258			34,613			1,438			(87,309	)		—

Net earnings	$	69,349		$	48,374		$	38,935		$	(87,309	)	$	69,349


	Six Months Ended February 28, 2011
	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net sales	$	73,905		$	245,914		$	329,291		$	—		$	649,110
Cost of products sold		21,934			172,996			207,300			—			402,230

Gross profit		51,971			72,918			121,991			—			246,880
Selling, administrative and engineering expenses		39,184			48,197			67,906			—			155,287
Amortization of intangible assets		—			7,508			5,467			—			12,975

Operating profit		12,787			17,213			48,618			—			78,618
Financing costs, net		15,790			—			—			—			15,790
Intercompany expense (income), net		(7,428	)		8,026			(598	)		—			—
Other expense (income), net		(696	)		(32	)		1,673			—			945

Earnings from continuing operations before income tax expense		5,121			9,219			47,543			—			61,883
Income tax expense		1,150			1,973			9,957			—			13,080

Net earnings from continuing operations before equity in earnings of subsidiaries		3,971			7,246			37,586			—			48,803
Equity in earnings of subsidiaries		43,728			29,412			2,197			(75,337	)		—

Earnings from continuing operations		47,699			36,658			39,783			(75,337	)		48,803
Loss from discontinued operations, net of income taxes		(13,880	)		—			(1,104	)		—			(14,984	)

Net earnings	$	33,819		$	36,658		$	38,679		$	(75,337	)	$	33,819

CONDENSED CONSOLIDATING BALANCE SHEETS

(In thousands)


	February 29, 2012
	Parent		Guarantors		Non- Guarantors		Eliminations			Consolidated
ASSETS
Current Assets	$	90,912	$	164,024	$	318,461	$	—		$	573,397
Property, Plant & Equipment, net		5,916		34,301		78,241		—			118,458
Goodwill		62,543		433,794		387,486		—			883,823
Other Intangibles, net		15,192		210,337		238,012		—			463,541
Intercompany Receivable		—		267,668		46,918		(314,586	)		—
Investment in Subsidiaries		1,884,879		440,606		120,274		(2,445,759	)		—
Other Long-term Assets		10,075		52		2,541		—			12,668

Total Assets	$	2,069,517	$	1,550,782	$	1,191,933	$	(2,760,345	)	$	2,051,887

LIABILITIES & SHAREHOLDERS' EQUITY
Current Liabilities	$	68,302	$	62,035	$	169,244	$	—		$	299,581
Long-term Debt		520,072		—		—		—			520,072
Deferred Income Taxes		129,723		—		37,030		—			166,753
Pension and Post-retirement Benefit Liabilities		16,522		—		2,152		—			18,674
Other Long-term Liabilities		63,675		700		25,795		—			90,170
Intercompany Payable		314,586		—		—		(314,586	)		—
Shareholders' Equity		956,637		1,488,047		957,712		(2,445,759	)		956,637

Total Liabilities and Shareholders' Equity	$	2,069,517	$	1,550,782	$	1,191,933	$	(2,760,345	)	$	2,051,887

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

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(In thousands)


	Six Months Ended February 29, 2012
	Parent			Guarantors			Non- Guarantors			Eliminations		Consolidated
Operating Activities
Net cash provided by (used in) operating activities	$	(495	)	$	12,656		$	39,840		$	—	$	52,001
Investing Activities
Proceeds from sale of property, plant and equipment		1,541			113			6,121			—		7,775
Capital expenditures		(3,142	)		(1,699	)		(5,611	)		—		(10,452	)
Business acquisitions, net of cash acquired		(290	)		—			(18,617	)		—		(18,907	)

Cash used in investing activities		(1,891	)		(1,586	)		(18,107	)		—		(21,584	)
Financing Activities
Net borrowings on revolving credit facilities		10			—			(177	)		—		(167	)
Intercompany loan activity		24,565			(11,070	)		(13,495	)		—		—
Purchase of treasury shares		(20,410	)		—			—			—		(20,410	)
Stock option exercises and related tax benefits		5,507			—			—			—		5,507
Cash dividends		(2,748	)		—			—			—		(2,748	)

Cash provided by (used in) financing activities		6,924			(11,070	)		(13,672	)		—		(17,818	)
Effect of exchange rate changes on cash		—			—			1,625			—		1,625

Net increase in cash and cash equivalents		4,538			—			9,686			—		14,224
Cash and cash equivalents - beginning of period		872			—			43,349			—		44,221

Cash and cash equivalents - end of period	$	5,410		$	—		$	53,035		$	—	$	58,445

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(In thousands)


	Six Months Ended February 28, 2011
	Parent			Guarantors			Non- Guarantors			Eliminations			Consolidated
Operating Activities
Net cash provided by (used in) operating activities	$	(35,738	)	$	(9,378	)	$	66,945		$	(1,533	)	$	20,296
Investing Activities
Proceeds from sale of property, plant and equipment		—			176			90			—			266
Proceeds from sale of businesses, net of transaction costs		—			—			3,463			—			3,463
Capital expenditures		(1,741	)		(2,180	)		(4,370	)		—			(8,291	)
Business acquisitions, net of cash acquired		—			(350	)		(158,183	)		—			(158,533	)

Cash used in investing activities		(1,741	)		(2,354	)		(159,000	)		—			(163,095	)
Financing Activities
Net borrowings on revolving credit facilities		40,000			—			1,169			—			41,169
Issuance of term loans		100,000			—			—			—			100,000
Intercompany loan activity		(102,640	)		11,732			90,908			—			—
Repurchases of 2% Convertible Notes		(34	)		—			—			—			(34	)
Debt issuance costs		(5,197	)		—			—			—			(5,197	)
Stock option exercises and related tax benefits		6,813			—			—			—			6,813
Cash dividends		(2,716	)		—			(1,533	)		1,533			(2,716	)

Cash provided by financing activities		36,226			11,732			90,544			1,533			140,035
Effect of exchange rate changes on cash		—			—			2,942			—			2,942

Net increase (decrease) in cash and cash equivalents		(1,253	)		—			1,431			—			178
Cash and cash equivalents - beginning of period		5,055			—			35,167			—			40,222

Cash and cash equivalents - end of period	$	3,802		$	—		$	36,598		$	—		$	40,400