Central Garden & Pet Company Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Consolidating Condensed Financial Information Of Guarantor Subsidiaries

Consolidating Condensed Financial Information Of Guarantor Subsidiaries

9 Months Ended

Jun. 25, 2011

Consolidating Condensed Financial Information Of Guarantor Subsidiaries

Consolidating Condensed Financial Information Of Guarantor Subsidiaries

11. Consolidating Condensed Financial Information of Guarantor Subsidiaries

Certain 100% wholly-owned subsidiaries of the Company (as listed below, collectively the "Guarantor Subsidiaries") have guaranteed fully and unconditionally, on a joint and several basis, the obligation to pay principal and interest on the Company's $400 million 8.25% Senior Subordinated Notes issued on March 8, 2010 (the "Notes"). Certain subsidiaries and operating divisions are not guarantors of the Notes and have been included in the financial results of the Parent in the information below. These Non-Guarantor entities are not material to the Parent. Those subsidiaries that are guarantors and co-obligors of the Notes are as follows:

Farnam Companies, Inc.

Four Paws Products Ltd.

Grant Laboratories, Inc.

Gulfstream Home & Garden, Inc.

Interpet USA, LLC

Kaytee Products, Inc.

Matthews Redwood & Nursery Supply, Inc.

Matson, LLC

New England Pottery, LLC

Pennington Seed, Inc. (including Pennington Seed, Inc. of Nebraska, Gro Tec, Inc., Seeds West, Inc., All-Glass Aquarium Co., Inc. and Cedar Works, LLC.)

Pets International, Ltd.

T.F.H. Publications, Inc.

Wellmark International (including B2E Corporation and B2E Biotech LLC)

In lieu of providing separate audited financial statements for the Guarantor Subsidiaries, the Company has included the accompanying consolidating condensed financial statements based on the Company's understanding of the Securities and Exchange Commission's interpretation and application of Rule 3-10 of the Securities and Exchange Commission's Regulation S-X.


	CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS Three Months Ended June 25, 2011 (in thousands) (unaudited)
	Parent			Guarantor Subsidiaries		Eliminations			Consolidated
Net sales	$	157,449		$	358,384	$	(31,530	)	$	484,303
Cost of products sold and occupancy		118,876			247,568		(31,530	)		334,914

Gross profit		38,573			110,816		0			149,389
Selling, general and administrative expenses		38,002			74,793		0			112,795

Income from operations		571			36,023		0			36,594
Interest – net		(9,947	)		139		0			(9,808	)
Other income (loss )		(576	)		894		0			318

Income (loss) before income taxes		(9,952	)		37,056		0			27,104
Income taxes (tax benefit)		(3,629	)		13,508		0			9,879

Income (loss) including noncontrolling interest		(6,323	)		23,548		0			17,225
Income attributable to noncontrolling interest		144			0		0			144

Income (loss) attributable to Central Garden & Pet Co. before equity in undistributed income of guarantor subsidiaries		(6,467	)		23,548		0			17,081

Equity in undistributed income of guarantor subsidiaries		23,548			0		(23,548	)		0

Net income attributable to Central Garden & Pet Co.	$	17,081		$	23,548	$	(23,548	)	$	17,081


	CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS Three Months Ended June 26, 2010 (in thousands) (unaudited)
	Parent			Guarantor Subsidiaries		Eliminations			Consolidated
Net sales	$	151,716		$	346,876	$	(33,106	)	$	465,486
Cost of products sold and occupancy		107,151			228,667		(33,106	)		302,712

Gross profit		44,565			118,209		0			162,774
Selling, general and administrative expenses		36,025			74,109		0			110,134

Income from operations		8,540			44,100		0			52,640
Interest – net		(9,879	)		83		0			(9,796	)
Other income (loss )		(4,612	)		4,654		0			42

Income (loss) before income taxes		(5,951	)		48,837		0			42,886
Income taxes (tax benefit)		(2,202	)		18,062		0			15,860

Income (loss) including noncontrolling interest		(3,749	)		30,775					27,026
Income attributable to noncontrolling interest		1,153			0		0			1,153

Income (loss) attributable to Central Garden & Pet Co. before equity in undistributed income of guarantor subsidiaries		(4,902	)		30,775		0			25,873
Equity in undistributed income of guarantor subsidiaries		30,775			0		(30,775	)		0

Net income attributable to Central Garden & Pet Co.	$	25,873		$	30,775	$	(30,775	)	$	25,873


	CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS Nine Months Ended June 25, 2011 (in thousands) (unaudited)
	Parent			Guarantor Subsidiaries		Eliminations			Consolidated
Net sales	$	392,617		$	966,295	$	(107,166	)	$	1,251,746
Cost of products sold and occupancy		290,338			672,859		(107,166	)		856,031

Gross profit		102,279			293,436		0			395,715
Selling, general and administrative expenses		97,411			208,563		0			305,974

Income from operations		4,868			84,873		0			89,741
Interest – net		(28,303	)		306		0			(27,997	)
Other income (expense)		(2,611	)		2,727		0			116

Income (loss) before income taxes		(26,046	)		87,906		0			61,860
Income tax (tax benefit)		(9,166	)		31,118		0			21,952

Income (loss) including noncontrolling interest		(16,880	)		56,788		0			39,908
Income attributable to noncontrolling interest		653			0		0			653

Income (loss) attributable to Central Garden & Pet Co. before equity in undistributed income of guarantor subsidiaries		(17,533	)		56,788		0			39,255
Equity in undistributed income of guarantor subsidiaries		56,788			0		(56,788	)		0

Net income attributable to Central Garden & Pet Co.	$	39,255		$	56,788	$	(56,788	)	$	39,255


	CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS Nine Months Ended June 26, 2010 (in thousands) (unaudited)
	Parent			Guarantor Subsidiaries		Eliminations			Consolidated
Net sales	$	379,937		$	898,866	$	(102,145	)	$	1,176,658
Cost of products sold and occupancy		269,911			597,160		(102,145	)		764,926

Gross profit		110,026			301,706		0			411,732
Selling, general and administrative expenses		94,092			203,957		0			298,049

Income from operations		15,934			97,749		0			113,683
Interest – net		(24,779	)		236		0			(24,543	)
Other income (loss )		(7,771	)		8,199		0			428

Income (loss) before income taxes		(16,616	)		106,184		0			89,568
Income taxes (tax benefit)		(6,113	)		39,139		0			33,026

Income (loss) including noncontrolling interest		(10,503	)		67,045					56,542
Income attributable to noncontrolling interest		1,943			0		0			1,943

Income (loss) attributable to Central Garden & Pet Co. before equity in undistributed income of guarantor subsidiaries		(12,446	)		67,045		0			54,599
Equity in undistributed income of guarantor subsidiaries		67,045			0		(67,045	)		0

Net income attributable to Central Garden & Pet Co.	$	54,599		$	67,045	$	(67,045	)	$	54,599


	CONSOLIDATING CONDENSED BALANCE SHEET June 25, 2011 (in thousands) (unaudited)
	Parent			Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Cash and cash equivalents	$	10,121		$	1,112	$	0		$	11,233
Short term investments		15,320			0		0			15,320
Accounts receivable, net		79,252			185,662		(7,496	)		257,418
Inventories		114,828			228,960		0			343,788
Prepaid expenses and other assets		17,502			22,593		0			40,095

Total current assets		237,023			438,327		(7,496	)		667,854
Land, buildings, improvements and equipment, net		69,255			101,932		0			171,187
Goodwill		0			209,348		0			209,348
Investment in guarantors		707,281			0		(707,281	)		0
Deferred income taxes and other assets		24,965			82,378		0			107,343

Total	$	1,038,524		$	831,985	$	(714,777	)	$	1,155,732

LIABILITIES AND EQUITY
Accounts payable	$	37,472		$	85,404	$	(7,496	)	$	115,380
Accrued expenses and other current liabilities		55,413			37,463		0			92,876

Total current liabilities		92,885			122,867		(7,496	)		208,256
Long-term debt		450,163			103		0			450,266
Other long-term obligations		2,370			1,734		0			4,104
Shareholders' equity attributable to Central Garden & Pet Co.		492,506			707,281		(707,281	)		492,506
Noncontrolling interest		600			0		0			600

Total equity		493,106			707,281		(707,281	)		493,106

Total	$	1,038,524		$	831,985	$	(714,777	)	$	1,155,732


	CONSOLIDATING CONDENSED BALANCE SHEET September 25, 2010 (in thousands) (unaudited)
	Parent			Guarantor Subsidiaries			Eliminations			Consolidated
ASSETS
Cash and cash equivalents	$	90,265		$	1,195		$	0		$	91,460
Short term investments		15,320			0			0			15,320
Accounts receivable, net		47,001			150,838			(5,417	)		192,422
Inventories		84,129			201,835			0			285,964
Prepaid expenses and other assets		23,447			19,286			0			42,733

Total current assets		260,162			373,154			(5,417	)		627,899
Land, buildings, improvements and equipment, net		63,303			101,978			0			165,281
Goodwill		0			207,319			0			207,319
Investment in guarantors		633,908			0			(633,908	)		0
Other assets		47,327			83,058			0			130,385

Total	$	1,004,700		$	765,509		$	(639,325	)	$	1,130,884

LIABILITIES AND EQUITY
Accounts payable	$	35,218		$	82,810		$	(5,417	)	$	112,611
Accrued expenses and other liabilities		34,692			46,891			0			81,583

Total current liabilities		69,910			129,701			(5,417	)		194,194
Long-term debt		400,026			80			0			400,106
Other long-term obligations		2,621			1,820			0			4,441
Shareholders' equity attributable to Central Garden & Pet Co.		530,696			633,908			(633,908	)		530,696
Noncontrolling interest		1,447			0			0			1,447

Total equity		532,143			633,908			(633,908	)		532,143

Total	$	1,004,700		$	765,509		$	(639,325	)	$	1,130,884


	CONSOLIDATING CONDENSED STATEMENT OF CASH FLOWS Nine Months Ended June 25, 2011 (in thousands) (unaudited)
	Parent			Guarantor Subsidiaries			Eliminations			Consolidated
Net cash provided (used) by operating activities	$	61,141		$	(5,856	)	$	(56,788	)	$	(1,503	)

Additions to property and equipment		(10,901	)		(9,290	)		0			(20,191	)
Businesses acquired, net of cash acquired		(23,403	)		(1,029	)		0			(24,432	)
Investment in guarantor subsidiaries		(73,372	)		16,584			56,788			0

Net cash provided (used) by investing activities		(107,676	)		6,265			56,788			(44,623	)

Repayments of long-term debt		(93	)		(128	)		0			(221	)
Borrowings under revolving line of credit		593,000			0			0			593,000
Repayments under revolving line of credit		(543,000	)		0			0			(543,000	)
Repurchase of common stock		(83,602	)		0			0			(83,602	)
Proceeds from issuance of common stock		1,436			0			0			1,436
Deferred financing costs		(1,034	)		0			0			(1,034	)
Excess tax benefits from stock-based awards		791			0			0			791
Distribution to noncontrolling interest		(1,500	)		0			0			(1,500	)

Net cash used by financing activities		(34,002	)		(128	)		0			(34,130	)

Effect of exchange rate changes on cash		394			(365	)		0			29

Net decrease in cash and cash equivalents		(80,143	)		(84	)		0			(80,227	)
Cash and cash equivalents at beginning of period		90,265			1,195			0			91,460

Cash and cash equivalents at end of period	$	10,122		$	1,111		$	0		$	11,233


	CONSOLIDATING CONDENSED STATEMENT OF CASH FLOWS Nine Months Ended June 26, 2010 (in thousands) (unaudited)
	Parent			Guarantor Subsidiaries			Eliminations			Consolidated
Net cash provided by operating activities	$	88,676		$	69,742		$	(67,045	)	$	91,373

Additions to property and equipment		(10,027	)		(5,584	)		0			(15,611	)
Investment in guarantor subsidiaries		(2,174	)		(64,871	)		67,045			0

Net cash used by investing activities		(12,201	)		(70,455	)		67,045			(15,611	)

Repayments of long-term debt		(407,650	)		(206	)		0			(407,856	)
Proceeds from issuance of long-term debt		400,000			0			0			400,000
Proceeds from revolver		10,000			0			0			10,000
Repayments of revolver		(10,000	)		0			0			(10,000	)
Repurchase of common stock		(48,314	)		0			0			(48,314	)
Proceeds from issuance of common stock		1,062			0			0			1,062
Payment of financing costs		(12,490	)		0			0			(12,490	)
Excess tax benefits from stock-based awards		720			0			0			720
Distribution to noncontrolling interest		(2,761	)		0			0			(2,761	)

Net cash used by financing activities		(69,433	)		(206	)		0			(69,639	)

Effect of exchange rate changes on cash		0			(168	)		0			(168	)

Net increase (decrease) in cash and cash equivalents		7,042			(1,087	)		0			5,955
Cash and cash equivalents at beginning of period		82,958			2,710			0			85,668

Cash and cash equivalents at end of period	$	90,000		$	1,623		$	0		$	91,623

- Definition

The entire disclosure for condensed financial information, including the financial position, cash flows, and the results of operations of the registrant (parent company) as of the same dates or for the same periods for which audited consolidated financial statements are being presented. Alternatively, the details of this disclosure can be reported by the specific parent company taxonomy elements, indicating the appropriate date and period contexts in an instance document.

+ References + Details