<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): February 5, 1999
OXFORD AUTOMOTIVE, INC.
(Exact name of Registrant as specified in its charter)
Michigan 333-58131 38-3262809
(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
1250 Stephenson Highway
Troy, Michigan 48083
(Address of principal executive offices)
Registrant's telephone number, including area code: (248) 577-1400
N/A
(Former Name or Former Address, if Changed Since Last Report)
<PAGE> 2
AMENDMENT NO. 1
The undersigned Registrant hereby amends the following items, financial
statements, exhibits or other portions of its Current Report on Form 8-K dated
February 5, 1999 as set forth in the pages attached hereto:
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Statements of Businesses Acquired.
Filed with this Amendment are the following financial statements of
Cofimeta S.A. ("Cofimeta").
(1) Audited Consolidated Assets and Liabilities as of September 30,
1998, and December 31, 1997.
(2) Audited Consolidated Income Statements and Cash Flow Statements for
the nine months ended September 30, 1998, and the years ended
December 31, 1997 and 1996.
(b) Pro Forma Financial Information.
Filed with this Amendment is the following pro forma financial
information:
(1) Unaudited Pro Forma Combined Balance Sheet as of December 31, 1998.
(2) Unaudited Pro Forma Combined Statement of Operations for the year
ended March 31, 1998 and for the nine months ended December 31, 1998.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this amendment to be signed on its behalf by the
undersigned thereunto duly authorized.
OXFORD AUTOMOTIVE, INC.
/s/ Aurelian Bukatko
----------------------------------------
Aurelian Bukatko,
Senior Vice President and
Chief Financial Officer
Dated: April 20, 1999
<PAGE> 4
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
<S> <C>
Cofimeta S.A.
Independent Auditors Report..................................................................... F-2
Consolidated Assets as of September 30, 1998 and December 31, 1997.............................. F-3
Consolidated Liabilities as of September 30, 1998 and December 31, 1997......................... F-4
Consolidated Income Statements for the nine months ended September 30, 1998
and the years ended December 31, 1997 and 1996................................................ F-5
Consolidated Cash Flow Statements for the nine months ended September 30, 1998
and the years ended December 31, 1997 and 1996................................................ F-6
Notes to Consolidated Financial Statements...................................................... F-7
Pro Forma Combined Financial Data............................................................... F-33
</TABLE>
F-1
<PAGE> 5
INDEPENDENT AUDITORS REPORT
We have audited the accompanying consolidated balance sheets of COFIMETA S.A.
("the Company") and its subsidiaries as at September 30, 1998 and December 31,
1997 and the related statements of income, and cash flows for each of the two
years in the period ended December 31, 1997 and for the nine month period ended
September 1998 which have been prepared in accordance with accounting
principles generally accepted in France. These financial statements are the
responsibility of the Company's management. Our responsibility is to express
our opinion on these financial statements based on our audits.
We conducted our audit in accordance with the professional standards generally
accepted in France, which are substantially similar to generally accepted
auditing standards in the United States. Those standards required that we plan
and perform our audit to obtain reasonable assurance that the financial
statements are free from material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made in the preparation of the financial statements, as
well as evaluating their overall presentation. We believe that our audit
provides a reasonable basis for our opinion.
As described in Note 1 to the consolidated financial statements, the financial
statements related to the years ended December 31, 1997 and 1996 have been
extracted from the consolidated financial statements of GROUPE VALFOND and
GROUPE ARBEL, respectively which were the shareholders of the Company as at the
respective dates.
The accounting principles followed by GROUPE VALFOND differ in certain material
respects to those previously applied by GROUPE ARBEL and the impact of the
changes has been recorded as a credit to Group reserves in the Shareholders'
equity and described in Note 6 to the consolidated financial statements
prepared for the year ended December 31, 1997.
In our opinion, the accompanying consolidated financial statements present
fairly, in all material respects, the financial position of COFIMETA S.A. and
its subsidiaries as at September 30, 1998 and December 31, 1997 and the
results of their operations and their cash flows for each of the two years in
the period December 31, 1997 and for the nine month period ended September 30,
1998, in conformity with accounting principles generally accepted in France.
Accounting principles generally accepted in France vary in certain material
respects from accounting principles generally accepted in the United States.
The application of the latter would have affected the determination of the
consolidated net income for the nine months period ended September 30, 1998 and
the year ended December 31, 1997 and the determination of the consolidated
Shareholders' equity and consolidated financial position as at September 30,
1998 and December 31, 1997 to the extent summarized in Note 17 to the
consolidated financial statements.
Paris, March 31, 1999
Coopers & Lybrand Audit
Guy-Alain Sitbon
Partner
F-2
<PAGE> 6
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
CONSOLIDATED ASSETS
<TABLE>
<CAPTION>
------------------------------------------------
SEPTEMBER 30, 1998
- ---------------------------------------------------------------------------------------------------------------
In Thousand French Francs NOTES GROSS AMORT. & NET
DEPRECIATION
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FIXED ASSETS
- - Intangible assets 2 8,239.4 7,837.2 402.2
- - Tangible assets 2 608,636.3 454,238.5 154,397.8
- - Financial assets 2 6,768.1 867.8 5,900.3
- ---------------------------------------------------------------------------------------------------------------
TOTAL 623,643.8 462,943.5 160,700.3
- ---------------------------------------------------------------------------------------------------------------
CURRENT ASSETS
- - Inventories 3 125,448.3 16,556.8 108,891.5
- - Payments on account on orders - 3,587.0 3,587.0
- - Trade accounts receivable and related
accounts 4 165,542.4 4,585.4 160,957.0
- - Other debtors 5 280,859.7 3,181.9 277,677.8
- - Cash and banks - 48,586.5 1,039.1 47,547.4
- - Deferred charges - 2,607.2 2,607.2
- ---------------------------------------------------------------------------------------------------------------
TOTAL 626,631.1 25,363.2 601,267.9
- ---------------------------------------------------------------------------------------------------------------
- - Realizable exchange losses - 0.8 0.8
- ---------------------------------------------------------------------------------------------------------------
TOTAL 1,250,275.7 488,306.7 761,969.0
- ---------------------------------------------------------------------------------------------------------------
<CAPTION>
--------------------------------------------------
DECEMBER 31, 1997
- -----------------------------------------------------------------------------------------
In Thousand French Francs
GROSS AMORT. & NET
DEPRECIATION
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C>
FIXED ASSETS
- - Intangible assets 8,095.2 7,591.4 503.8
- - Tangible assets 591,857.4 421,365.0 170,492.4
- - Financial assets 6,638.0 871.0 5,767.0
- -----------------------------------------------------------------------------------------
TOTAL 606,590.6 429,827.4 176,763.2
- -----------------------------------------------------------------------------------------
CURRENT ASSETS
- - Inventories 124,147.0 16,691.4 107,455.6
- - Payments on account on orders 2,335.4 2,335.4
- - Trade accounts receivable
and related accounts 216,182.0 5,124.0 211,058.0
- - Other debtors 203,629.0 2,893.0 200,736.0
- - Cash and banks 84,684.9 1,539.0 83,145.9
- - Deferred charges 1,616.9 1,616.9
- -----------------------------------------------------------------------------------------
TOTAL 632,595.2 26,247.4 606,347.8
- -----------------------------------------------------------------------------------------
- - Realizable exchange losses 14.0 14.0
- -----------------------------------------------------------------------------------------
TOTAL 1,239,199.8 456,074.8 783,125.0
- -----------------------------------------------------------------------------------------
</TABLE>
F-3
<PAGE> 7
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
CONSOLIDATED LIABILITIES
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------- ---------------------------
In Thousand French Francs NOTES SEPTEMBER 30, 1998 DECEMBER 31, 1997
- ----------------------------------------------------------------------------------------- ---------------------------
<S> <C> <C> <C>
EQUITY
- - Share capital 6 25,113.3 25,113.3
- - Premiums on share issues 6 66,800.9 66,800.9
- - Reserves 6 80.0 80.0
- - Consolidated Group reserves 6 2,954.3 74,182.8
- - Losses carried forward 6 (116,911.1) (48,856.2)
- - Group net income 6 10,447.4 (139,283.4)
- ----------------------------------------------------------------------------------------- ---------------------------
TOTAL (11,515.2) (21,962.6)
- ----------------------------------------------------------------------------------------- ---------------------------
Minority interests 6 (3.3) (3.9)
- ----------------------------------------------------------------------------------------- ---------------------------
PROVISIONS
- - Provisions for liabilities 7 76,686.6 83,117.1
- - Provisions for charges 7 2,835.1 4,643.7
- - Provisions for deferred taxes -
- ----------------------------------------------------------------------------------------- ---------------------------
TOTAL 79,521.7 87,760.8
- ----------------------------------------------------------------------------------------- ---------------------------
LIABILITIES
- - Financial liabilities 8 2,989.6 3,910.4
- - Trade accounts payable and related accounts - 155,924.4 110,607.6
- - Tax and social liabilities - 74,323.7 68,745.7
- - Other liabilities 9 460,294.7 534,067.0
- - Deferred income - 433.4
- ----------------------------------------------------------------------------------------- ---------------------------
TOTAL 693,965.8 717,330.7
- ----------------------------------------------------------------------------------------- ---------------------------
- - Realizable exchange losses -
- ----------------------------------------------------------------------------------------- ---------------------------
TOTAL LIABILITIES 761,969.0 783,125.0
- ----------------------------------------------------------------------------------------- ---------------------------
</TABLE>
F-4
<PAGE> 8
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
CONSOLIDATED INCOME STATEMENTS
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------- ---------------------- ---------------------
NINE MONTHS ENDED
In Thousand French Francs NOTES SEPTEMBER 30, 1998 DECEMBER 31, 1997 DECEMBER 31, 1996
- -------------------------------------------------------------------------------- ---------------------- ---------------------
<S> <C> <C> <C> <C>
- - Net sales 10 945,069.9 1,219,552.0 1,044,918.0
- - Change in work in progress and finished goods
inventories - (4,665.1) (61,639.0) 41,882.0
- - Own work capitalized - 110.0 389.0 3,038.0
- - Other income 11 16,319.2 40,569.0 8,762.0
- -------------------------------------------------------------------------------- ---------------------- ---------------------
TOTAL OPERATING INCOME 956,834.0 1,198,871.0 1,098,600.0
- -------------------------------------------------------------------------------- ---------------------- ---------------------
- - Consumption of raw materials and supplies - 481,163.7 563,885.0 532,228.0
- - External services - 170,513.1 231,350.0 207,003.0
- - Taxes, levies and similar payments - 22,974.5 29,140.0 28,492.0
- - Personnel costs - 222,905.5 335,950.0 336,442.0
- - Depreciation and provisions - 44,139.0 65,828.0 79,422.0
- - Other charges - 1,189.2 4,938.0 10,995.0
- -------------------------------------------------------------------------------- ---------------------- ---------------------
TOTAL OPERATING CHARGES 942,885.0 1,231,091.0 1,194,582.0
- -------------------------------------------------------------------------------- ---------------------- ---------------------
OPERATING INCOME / (LOSS) 13,949.0 (32,220.0) (95,982.0)
- -------------------------------------------------------------------------------- ---------------------- ---------------------
- - Financial income 12 5,332.5 7,057.0 2,876.0
- - Financial charges 12 9,561.7 18,965.0 17,093.0
- -------------------------------------------------------------------------------- ---------------------- ---------------------
FINANCIAL INCOME / (LOSS) (4,229.2) (11,908.0) (14,217.0)
- -------------------------------------------------------------------------------- ---------------------- ---------------------
EARNINGS FROM OPERATIONS BEFORE INCOME TAX 9,719.8 (44,128.0) (110,199.0)
- -------------------------------------------------------------------------------- ---------------------- ---------------------
- - Extraordinary income 13 44,652.1 4,102.0 15,233.0
- - Extraordinary charges 13 43,400.3 99,205.0 32,576.0
- -------------------------------------------------------------------------------- ---------------------- ---------------------
EXTRAORDINARY INCOME / (LOSS) 1,251.8 (95,103.0) (17,343.0)
- -------------------------------------------------------------------------------- ---------------------- ---------------------
- - Employee profit share -
- - Income tax - 523.6 75.0 509.0
- -------------------------------------------------------------------------------- ---------------------- ---------------------
NET INCOME / (LOSS) 14 10,448.0 (139,306.0) (128,051.0)
- -------------------------------------------------------------------------------- ---------------------- ---------------------
GROUP NET INCOME / (LOSS) 10,447.4 (139,283.4) (128,036.0)
- -------------------------------------------------------------------------------- ---------------------- ---------------------
Minority interest net income / (loss) 0.6 (22.6) (15.0)
- -------------------------------------------------------------------------------- ---------------------- ---------------------
</TABLE>
F-5
<PAGE> 9
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
CONSOLIDATED CASH FLOW STATEMENTS
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------- --------------------- ---------------------
CASH FLOWS FROM OPERATING ACTIVITIES SEPTEMBER 30, 1998 DECEMBER 31, 1997 DECEMBER 31, 1996
- ----------------------------------------------------------------------------------- --------------------- ---------------------
<S> <C> <C> <C>
NET INCOME 10,448.0 (139,306.0) (128,051.0)
Elimination of charges and income with no effect on cash or
non operating:
- Depreciation and amortization expense 35,704.7 50,592.0 51,302.0
- Current assets depreciation 7,509.8 10,110.0 -
- Provision for risks 27,801.8 87,543.0 -
- Reversals and transfers of charges (41,692.1) (28,876.5) -
- Sales/write off of fixed assets (383.7) (348.3) (1,812.0)
Working capital :
(Increase)/decrease in inventory (1,301.7) 59,154.0 (27,554.0)
(Increase)/decrease in trade accounts receivable 50,639.6 15,496.0 46,481.0
(Increase)/decrease in other debtors (78,482.6) (110,932.4) -
(Increase)/decrease in deferred charges (991.2) 159.1 910.0
Increase/(decrease) in trade accounts payable 45,315.6 (205,911.4) 49,380.0
Increase/(decrease) in other creditors (68,195.8) 385,589.5 5,044.0
Increase/(decrease) in deferred income 433.4 (244.0) 244.0
TOTAL CASH FLOWS FROM OPERATING ACTIVITIES (13,194.3) 123,025.0 (4,056.0)
- ---------------------------------------------------------------------------------- --------------------- ---------------------
CASH FLOWS FROM INVESTING ACTIVITIES
- --------------------------------------------------------------
Purchases of fixed assets (22,215.7) (11,020.6) (62,865.0)
Purchases of intangible assets (144.2) (264.9)
Sales of fixed assets 568.0 1,822.9 2,357.0
TOTAL CASH FLOWS FROM INVESTING ACTIVITIES (21,791.9) (9,462.6) (60,508.0)
- ---------------------------------------------------------------------------------- --------------------- ---------------------
CASH FLOWS FROM FINANCING ACTIVITIES
- --------------------------------------------------------------
Payments of dividends
Increase in financial assets (192.0) 4,816.0 5,641.0
Increase in medium-term debt 480.0 1,214.8 1,026.0
Reimbursement of medium-term debt (47,857.0)
Increase of capital 34,999.8
TOTAL CASH FLOWS FROM FINANCING ACTIVITIES 288.0 41,030.6 (41,190.0)
- ---------------------------------------------------------------------------------- --------------------- ---------------------
TOTAL CASH FLOWS (34,698.2) 154,593.0 (105,754.0)
- ---------------------------------------------------------------------------------- --------------------- ---------------------
Cash balance - beginning 81,990.0 (72,603.0) 33,151.0
Cash balance - ending 47,291.8 81,990.0 (72,603.0)
FLUCTUATIONS (34,698.2) 154,593.0 (105,754.0)
- ---------------------------------------------------------------------------------- --------------------- ---------------------
</TABLE>
F-6
<PAGE> 10
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
OF GROUP COFIMETA SA
AS OF SEPTEMBER 30, 1998
----------------------------------
NOTE 1
The consolidated financial statements have been prepared using the full
consolidation method and include all the subsidiaries of Cofimeta SA.
SUBSIDIARIES
The following subsidiaries have been included:
% shareholding
--------------
- - AUBRY SA 99.9
- - ECRIM SA 99.9
- - SOMENOR SA 99.9
- - SOCORI Technologies SA 99.9
CLOSING DATE OF THE ACCOUNTS
All the subsidiaries have their normal year-end as of December 31.
However, as part of the current changes taking place at the level of COFIMETA
shareholding, the attached consolidated financial statements have been prepared
at an interim date which covers the nine month period ended September 30, 1998
using the same methods and principles of their normal year-end.
It is intended that the financial statements will continue to be prepared for
their usual December 31 year-end.
CONTINUATION PLAN
The COFIMETA Group was declared under a legal continuation plan as at January
29, 1997. The legal observation period ended on June 26, 1997 with the judgement
allowing the companies to continue their business under certain obligations.
F-7
<PAGE> 11
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
The accounts payable shown under "Continuation Plan Liabilities" for each
company are those accounts payable which have been formally admitted to be part
of the company's liabilities. The first installment payment took place on June
26, 1998 for an amount of 18.5 million FF including the specific requirements
which have been accepted by the Court.
The reimbursement of the "Continuation Plan Liabilities" will be made in
accordance with the following timetable:
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Option 1 1.2% 1.2% 3.32% 6.40% 12.56% 12.56% 12.56% 16.73% 16.73% 16.73%
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Option 2 1.2% 1.2% 3.32% 6.40% 12.56% 12.56% 12.56% 16.73% 16.73% 16.73%
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
REFUSALS 0.50% 0.50% 1.20% 3.20% 12.56% 12.56% 12.56% 18.97% 18.97% 18.97%
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
ACCOUNTING PRINCIPLES AND EVALUATION METHODS
The consolidated financial statements have been prepared in accordance with
accounting principles generally accepted in France.
Under French law, COFIMETA is exempted from the preparation of consolidated
financial statements provided that the accounts of the company and its
subsidiaries ("the COFIMETA Group") are themselves included in the consolidated
financial statements of the company holding the shares of COFIMETA or in those
of the ultimate owner.
As at December 31, 1996 and for the year then ended, the COFIMETA Group accounts
were included in those of Groupe ARBEL, a company incorporated in France and of
which Coopers & Lybrand Audit were the co-statutory auditors together with
Cabinet Constantin.
On December 30, 1997, Groupe VALFOND acquired 80.1% of the COFIMETA shares.
As at December 31, 1997, the Groupe VALFOND included in its consolidated
accounts the consolidated Balance Sheet of the COFIMETA Group. The consolidated
accounts of Groupe VALFOND are audited by Calan, Ramolino et Associes and
ATC-SOFIRAC.
Groupe VALFOND accounting principles differ in certain material respects from
those of Groupe ARBEL and the consolidated balance sheet as at December 31, 1997
as well as the related statement of income for the year ended at that date have
been prepared in accordance with the accounting principles of Groupe VALFOND.
The impact of the change has been recorded as a credit to the Group reserves in
the Shareholder's equity and described in Note 6 to the consolidated financial
statements.
F-8
<PAGE> 12
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
INTANGIBLE ASSETS
Purchased goodwill is stated at historical cost and is not depreciated.
Software costs are depreciated over 1 to 5 years under the straight-line
depreciation method.
TANGIBLE ASSETS
Tangible assets are stated at historical cost and are generally depreciated
using the straight-line depreciation method. The accelerated method of
depreciation has been utilized for certain fixed assets when it better reflects
the industrial usage of the fixed assets.
The average rates of depreciation are :
- Buildings 20 years
- Light Buildings 10 years
- Fixtures and fittings 10 years
- Technical installations 8 to 10 years
- Industrial equipment and toolings 10 years
- Other tangible assets 3 to 10 years
INVENTORIES
Inventories are carried at the lower of average cost or market value.
Cost of goods purchased for resale and raw materials include the purchase price
and incidental expenses.
Cost of finished goods include production cost represented by raw materials,
direct and indirect charges (including depreciation costs of the related fixed
assets).
Financial costs are excluded from inventories.
Market value is represented either by the current market value or the selling
price after deduction of direct selling costs.
RECEIVABLES
Receivables are stated at nominal value. A provision is recorded when book value
is higher than net realizable value.
Factored receivables are presented as a reduction of trade accounts receivable.
F-9
<PAGE> 13
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
PROVISIONS
An amount of 12 million FF was provided as of December 31, 1997 to cover
"warranties given to customers". This amount was directly debited to retained
earnings.
Potential risks on litigations with customers and suppliers are provided for in
the accounts.
Provisions related to litigations with employees are recorded when the risk is
known or when individual measures are anticipated.
Accounts receivable related to 1995, 1996 and 1997, for which full documentation
has not yet been completed have been provided for.
Provisions for restructuring include indemnities due to employees and related
costs, costs of cancellation of leases and write-down of fixed assets related to
those activities which are being restructured.
RETIREMENT INDEMNITIES
Retirement indemnities are not booked but disclosed and the evaluation is based
on an actuarial computation.
These indemnities are calculated in accordance with the projected unit credit
method, employee by employee, by applying probability mortality rates as well as
seniority at the date of retirement to the accumulated rights as of September
30, 1998, with an actualisation rate (interest rate less salary progression) of
3%.
LEASES
Fixed assets purchased under financial lease agreements have not been
capitalized.
TAXATION
The "Tax consolidation Group" as of September 30, 1998 only includes COFIMETA,
ECRIM and SOCORI Technologies.
Because of the magnitude of net loss carry forwards, no income tax has been
booked except for the compulsory lump-sum taxes paid by the companies.
F-10
<PAGE> 14
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
Addresses of the legal entities part of Group COFIMETA are the following :
COFIMETA SA
68, rue de Villiers
92300 Levallois-Perret
tel. 01 40 89 69 00
SIREN 334.924.677
AUBRY SA
Avenue Jean Jaures
18400 St Florent sur Cher
tel. 02 48 23 70 50
SIREN 572.175.701
ECRIM SA
Chemin de Chambrais
La Vespiere
14290 Orbec
tel. 02 31 48 47 46
SIREN 300.759.412
SOMENOR SA
194, boulevard Faidherbe
59500 Douai
tel. 03 27 93 39 39
SIREN 337.853.337
SOCORI TECHNOLOGIES SA
515, avenue Roland Garros
78530 Buc
Tel. 01 39 24 13 30
SIREN 340.086.339
F-11
<PAGE> 15
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 2 - FIXED ASSETS
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
SEPTEMBER 30, 1998
- -------------------------------------------------------------------------------------------------------------------
GROSS BOOK GROSS BOOK NET BOOK
INTANGIBLE ASSETS VALUE AS OF ACQUISITIONS VALUE AS OF AMORTIZ. VALUE AS OF
In Thousand French Francs JAN 1, 1998 SEPT 30, 1998 SEPT 30, 1998
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
- - Concessions, patents, licences 5,241.7 124.4 5,366.1 4,986.7 379.4
- - Goodwill 743.8 743.8 743.8
- - Others 2,109.7 19.8 2,129.5 2,106.7 22.8
- -------------------------------------------------------------------------------------------------------------------
TOTAL 8,095.2 144.2 8,239.4 7,837.2 402.2
- -------------------------------------------------------------------------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
GROSS BOOK GROSS BOOK NET BOOK
TANGIBLE ASSETS VALUE AS OF ACQUISITIONS DISPOSALS VALUE AS OF AMORTIZ. VALUE AS OF
In Thousand French Francs JAN 1, 1998 SEPT 30, 1998 SEPT 30, 1998
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- - Land 12,281.7 326.0 12,607.7 3,449.3 9,158.4
- - Buildings 99,911.5 512.2 240.0 100,183.7 74,173.2 26,010.5
- - Plant and machinery, tools and
equipment 450,454.6 18,374.2 155.5 468,673.3 356,861.3 111,812.0
- - Other tangible assets 24,635.3 708.8 690.8 24,653.3 19,754.7 4,898.6
- - Assets in course of construction 4,280.9 2,294.5 4,280.9 2,294.5 2,294.5
- - Payments on account 293.4 69.6 223.8 223.8
- -------------------------------------------------------------------------------------------------------------------
TOTAL 591,857.4 22,215.7 5,436.8 608,636.3 454,238.5 154,397.8
- -------------------------------------------------------------------------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
GROSS BOOK GROSS BOOK NET BOOK
FINANCIAL ASSETS VALUE AS OF ACQUISITIONS DISPOSALS VALUE AS OF DEPRECIATION VALUE AS OF
In Thousand French Francs JAN 1, 1998 SEPT 30, 1998 SEPT 30, 1998
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - Other investments held as
fixed assets 631.4 631.4 602.8 28.6
- - Loans 5,021.7 13.7 5,008.0 5,008.0
- - Other financial assets 984.9 192.0 48.2 1,128.7 265.0 863.7
- -------------------------------------------------------------------------------------------------------------------
TOTAL 6,638.0 192.0 61.9 6,768.1 867.8 5,900.3
- -------------------------------------------------------------------------------------------------------------------
<CAPTION>
--------------------------------------------------------------------------------
DECEMBER 31, 1997
- -------------------------------------------------------------------------------------------------------------------
GROSS BOOK GROSS BOOK NET BOOK
INTANGIBLE ASSETS VALUE AS OF ACQUISITIONS DISPOSALS VALUE AS OF AMORTIZ. VALUE AS OF
In Thousand French Francs JAN 1, 1997 DEC 31, 1997 DEC 31, 1997
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- - Concessions, patents, licences 4,997.3 251.9 7.5 5,241.7 4,802.1 439.6
- - Goodwill 743.8 743.8 743.8
- - Others 2,096.7 13.0 2,109.7 2,045.5 64.2
- -------------------------------------------------------------------------------------------------------------------
TOTAL 7,837.8 264.9 7.5 8,095.2 7,591.4 503.8
- -------------------------------------------------------------------------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
GROSS BOOK GROSS BOOK NET BOOK
TANGIBLE ASSETS VALUE AS OF ACQUISITIONS DISPOSALS VALUE AS OF AMORTIZ. VALUE AS OF
In Thousand French Francs JAN 1, 1997 DEC 31, 1997 DEC 31, 1997
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- - Land 12,501.7 220.0 12,281.7 3,316.8 8,964.9
- - Buildings 99,537.4 1,161.1 787.0 99,911.5 70,094.5 29,817.0
- - Plant and machinery, tools and
equipment 430,967.9 23,898.6 4,411.9 450,454.6 328,340.6 122,114.0
- - Other tangible assets 24,020.1 2,019.2 1,404.0 24,635.3 19,613.1 5,022.2
- - Assets in course of construction 25,136.1 4,425.4 25,280.6 4,280.9 4,280.9
- - Payments on account 293.4 (0.0) 293.4 293.4
- -------------------------------------------------------------------------------------------------------------------
TOTAL 592,163.2 31,797.7 32,103.5 591,857.4 421,365.0 170,492.4
- -------------------------------------------------------------------------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
GROSS BOOK GROSS BOOK NET BOOK
FINANCIAL ASSETS VALUE AS OF ACQUISITIONS DISPOSALS VALUE AS OF AMORTIZ. VALUE AS OF
In Thousand French Francs JAN 1, 1997 DEC 31, 1997 DEC 31, 1997
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- - Other investments held as
fixed assets 630.3 1.7 0.6 631.4 606.0 25.4
- - Loans 4,859.0 201.3 38.6 5,021.7 5,021.7
- - Other financial assets 985.0 365.0 365.1 984.9 265.0 719.9
- -------------------------------------------------------------------------------------------------------------------
TOTAL 6,474.3 568.0 404.3 6,638.0 871.0 5,767.0
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
F-12
<PAGE> 16
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 3 - INVENTORIES
<TABLE>
<CAPTION>
----------------------------------------------------------------------
SEPTEMBER 30, 1998
- ---------------------------------------------------------------------------------------------------------------------
OPENING GROSS CHANGE INVENTORY CLOSING
INVENTORIES NET BOOK IN INVENTORY RESERVE NET BOOK
In Thousand French Francs VALUE VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - Raw materials 46,758.7 5,966.9 424.4 52,301.2
- - Work in progress 29,334.6 (4,650.5) 99.2 24,584.9
- - Semi-processed and finished goods 31,362.3 (14.7) (657.8) 32,005.4
- ---------------------------------------------------------------------------------------------------------------------
TOTAL 107,455.6 1,301.7 (134.2) 108,891.5
- ---------------------------------------------------------------------------------------------------------------------
<CAPTION>
----------------------------------------------------------------------
DECEMBER 31, 1997
- ----------------------------------------------------------------------------------------------------------------------
OPENING GROSS CHANGE INVENTORY CLOSING
INVENTORIES NET BOOK IN INVENTORY RESERVE NET BOOK
In Thousand French Francs VALUE VALUE
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - Raw materials 44,847.0 2,485.7 574.0 46,758.7
- - Work in progress 67,674.0 (51,863.4) (13,524.0) 29,334.6
- - Semi-processed and finished goods 36,268.0 (9,776.7) (4,871.0) 31,362.3
- ----------------------------------------------------------------------------------------------------------------------
TOTAL 148,789.0 (59,154.4) (17,821.0) 107,455.6
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE 4 - TRADE ACCOUNTS RECEIVABLE
<TABLE>
<CAPTION>
SEPTEMBER 30, 1998
- ---------------------------------------------------------------------------------------------------------------------
OPENING CHANGE IN BAD DEBT CLOSING
TRADE ACCOUNTS RECEIVABLE NET BOOK GROSS VALUE RESERVE NET BOOK
In Thousand French Francs VALUE VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - Trade accounts receivable 211,058.0 (50,639.6) (538.6) 160,957.0
- ---------------------------------------------------------------------------------------------------------------------
TOTAL 211,058.0 (50,639.6) (538.6) 160,957.0
- ---------------------------------------------------------------------------------------------------------------------
<CAPTION>
DECEMBER 31, 1997
- ---------------------------------------------------------------------------------------------------------------------
OPENING CHANGE IN BAD DEBT CLOSING
TRADE ACCOUNTS RECEIVABLE NET BOOK GROSS VALUE RESERVE NET BOOK
In Thousand French Francs VALUE VALUE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - Trade accounts receivable 227,812.0 (15,497.0) 1,257.0 211,058.0
- ---------------------------------------------------------------------------------------------------------------------
TOTAL 227,812.0 (15,497.0) 1,257.0 211,058.0
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
F-13
<PAGE> 17
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 5 - OTHER DEBTORS
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------- -----------------------
DESIGNATION AMOUNT AMOUNT
In Thousand French Francs SEPTEMBER 30, 1998 DECEMBER 31, 1997
- ----------------------------------------------------------------------------------------- -----------------------
<S> <C> <C>
- - Social accounts receivable 763.6 2,470.4
- - Tax accounts receivable 43,642.8 51,804.2
- - Fixed asset accounts receivable 800.0 800.0
- - Amounts due on sale of receivables (1) 166,867.0 64,304.2
- - Supplier prepayments 20,308.8 13,036.9
- - Other debtors 45,295.6 68,320.3
- ----------------------------------------------------------------------------------------- -----------------------
TOTAL 277,677.8 200,736.0
- ----------------------------------------------------------------------------------------- -----------------------
</TABLE>
(1) Represents retention amounts for factored receivables and amounts
factored but not financed under the "Dailly" law.
F-14
<PAGE> 18
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 6 - NET EQUITY CHANGES
<TABLE>
<CAPTION>
-------------------------------------------------------
AS OF SEPTEMBER 30, 1998
- ----------------------------------------------------------------------------------------
OPENING PRIOR YEAR-END NET INCOME FOR CLOSING
DESIGNATION BALANCE INCOME 9 MONTHS ENDED BALANCE
In Thousand French Francs ALLOCATION SEPT 30, 1998
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Share capital 25,113.3 25,113.3
Premiums on share issues 66,800.9 66,800.9
Legal reserves 72.2 72.2
Regimented reserves 7.8 7.8
Group reserves 74,182.8 (71,228.5) 2,954.3
Losses carried forward (48,856.2) (68,054.9) (116,911.1)
Group net income (139,283.4) 139,283.4 10,447.4 10,447.4
- ----------------------------------------------------------------------------------------
TOTAL SHAREHOLDER'S EQUITY (21,962.6) (0.0) 10,447.4 (11,515.2)
- ----------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------
OPENING PRIOR YEAR-END NET INCOME FOR CLOSING
DESIGNATION BALANCE INCOME 9 MONTHS ENDED BALANCE
In Thousand French Francs ALLOCATION SEPT 30, 1998
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Minority interest reserves 18.7 (22.6) (3.9)
Minority interest income / (loss) (22.6) 22.6 0.6 0.6
- ----------------------------------------------------------------------------------------
TOTAL MINORITY INTEREST (3.9) 0.0 0.6 (3.3)
- ----------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------
AS OF DECEMBER 31, 1997
- ----------------------------------------------------------------------------------------------------------------------
OPENING CAPITAL PRIOR YEAR-END OTHERS NET INCOME FOR CLOSING
DESIGNATION BALANCE CHANGES INCOME CHANGES (1) 12 MONTHS ENDED BALANCE
In Thousand French Francs ALLOCATION DEC 31, 1997
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Share capital 5,909.0 19,204.3 25,113.3
Premiums on share issues 63,005.4 15,795.5 (12,000.0) 66,800.9
Legal reserves 72.2 72.2
Regimented reserves 7.8 7.8
Group reserves 152,213.2 (89,906.6) 11,876.2 74,182.8
Losses carried forward (10,727.3) (38,128.9) (48,856.2)
Group net income (128,035.5) 128,035.5 (139,283.4) (139,283.4)
- ----------------------------------------------------------------------------------------------------------------------
TOTAL SHAREHOLDER'S EQUITY 82,444.8 34,999.8 0.0 (123.8) (139,283.4) (21,962.6)
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
OPENING CAPITAL PRIOR YEAR-END OTHERS NET INCOME FOR CLOSING
DESIGNATION BALANCE CHANGES INCOME CHANGES 12 MONTHS ENDED BALANCE
In Thousand French Francs ALLOCATION DEC 31, 1997
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Minority interest reserves 157.0 (15.0) (123.3) 18.7
Minority interest income / (loss) (15.0) 15.0 (22.6) (22.6)
- ----------------------------------------------------------------------------------------------------------------------
TOTAL MINORITY INTEREST 142.0 0.0 0.0 (123.3) (22.6) (3.9)
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) As at December 1997, the accounting principles applied by Groupe VALFOND
differred from those previously applied by Groupe ARBEL. The impact of the
changes which has been recorded as an adjustment to shareholder's equity is
summarized as follows:
<TABLE>
<CAPTION>
---------------------------
THOUSANDS OF FF
- -------------------------------------------------------------------------------------
<S> <C>
Change from accelerated method of depreciation to straight-line method
on certain fixed assets 6,394
- -------------------------------------------------------------------------------------
Groupe VALFOND policy is to maintain as an asset the long-terms loans
to employees previously expensed 4,654
- -------------------------------------------------------------------------------------
Groupe VALFOND policy is not to capitalize leases which was the
policy previously adopted (133)
- -------------------------------------------------------------------------------------
Groupe VALFOND did not record the impact of a
negative goodwill which arose at Groupe ARBEL level 1,073
- -------------------------------------------------------------------------------------
Other (112)
- -------------------------------------------------------------------------------------
TOTAL 11,876
- -------------------------------------------------------------------------------------
</TABLE>
F-15
<PAGE> 19
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 7 - PROVISIONS FOR LIABILITIES AND CHARGES
<TABLE>
<CAPTION>
----------------------------------------------------------------
AS OF SEPTEMBER 30, 1998
- ----------------------------------------------------------------------------------------------------------------------------
OPENING CLOSING
DESIGNATION BALANCE ADDITIONS REVERSALS BALANCE
In Thousand French Francs
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PROVISIONS FOR LIABILITIES
Risks and disputes 15,653.0 15,122.2 9,519.9 21,255.3
Customer warranty 12,000.0 12,000.0
Restructuring provisions 55,019.0 4,909.0 16,868.7 43,059.3
Major maintenance expenses 252.1 252.1
Other 445.1 24.0 349.2 119.9
- ----------------------------------------------------------------------------------------------------------------------------
SUB-TOTAL 83,117.1 20,307.3 26,737.8 76,686.6
- ----------------------------------------------------------------------------------------------------------------------------
PROVISIONS FOR CHARGES
Risks and disputes 680.0 110.0 570.0
Restructuring provisions 1,282.1 350.0 642.1 990.0
Other 2,681.6 1,406.5 1,275.1
- ----------------------------------------------------------------------------------------------------------------------------
SUB-TOTAL 4,643.7 350.0 2,158.6 2,835.1
- ----------------------------------------------------------------------------------------------------------------------------
TOTAL 87,760.8 20,657.3 28,896.4 79,521.7
- ----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
-----------------------------------------------------------------
AS OF DECEMBER 31, 1997
- -------------------------------------------------------------------------------------------------------------------------
OPENING CLOSING
DESIGNATION BALANCE ADDITIONS REVERSALS BALANCE
In Thousand French Francs
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PROVISIONS FOR LIABILITIES
Risks and disputes 5,192.0 12,323.1 1,862.1 15,653.0
Customer warranty 12,000.0 12,000.0
Restructuring provisions 1,750.0 53,719.0 450.0 55,019.0
Major maintenance expenses
Other 30.2 414.9 445.1
- -------------------------------------------------------------------------------------------------------------------------
SUB-TOTAL 6,972.2 78,457.0 2,312.1 83,117.1
- -------------------------------------------------------------------------------------------------------------------------
PROVISIONS FOR CHARGES
Risks and disputes 550.0 130.0 680.0
Restructuring provisions 1,282.1 1,282.1
Other 309.4 2,421.9 49.7 2,681.6
- -------------------------------------------------------------------------------------------------------------------------
SUB-TOTAL 859.4 3,834.0 49.7 4,643.7
- -------------------------------------------------------------------------------------------------------------------------
TOTAL 7,831.6 82,291.0 2,361.8 87,760.8
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
F-16
<PAGE> 20
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 8 - FINANCIAL LIABILITIES
<TABLE>
<CAPTION>
--------------------------------------------------------------------------
AS OF SEPTEMBER 30, 1998
- -------------------------------------------------------------------------------------------------------------------
TERM BANK BANK GROUP OTHER TOTAL
In Thousand French Francs OVERDRAFTS LOANS
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
- - Less than one year 1,294.8 1,214.8 2,509.6
- - Between one and five years 120.0 120.0
- - Over five years 360.0 360.0
- -------------------------------------------------------------------------------------------------------------------
TOTAL 1,294.8 1,694.8 2,989.6
- -------------------------------------------------------------------------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
LESSORS LEGAL INITIAL REMAINING REMAINING FUTURE
In Thousand French Francs ENTITY AMOUNT CAPITAL DURATION INTEREST
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Cicobail Aubry 12,626.1 8,207.0 19.5 semesters 1,827.9
Sovac Aubry 109.7 40.9 6 quarters 2.9
Bail Materiel Socori 1,580.0 669.9 21 months 48.3
- -------------------------------------------------------------------------------------------------------------------
TOTAL 14,315.8 8,917.8 1,879.1
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------
AS OF DECEMBER 31, 1997
- ----------------------------------------------------------------------------------------------------------------
TERM BANK BANK GROUP OTHER TOTAL
In Thousand French Francs OVERDRAFTS LOANS
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
- - Less than one year 2,695.6 1,214.8 3,910.4
- - Between one and five years
- - Over five years
- ----------------------------------------------------------------------------------------------------------------
TOTAL 2,695.6 1,214.8 3,910.4
- ----------------------------------------------------------------------------------------------------------------
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
LESSORS LEGAL INITIAL REMAINING REMAINING FUTURE
In Thousand French Francs ENTITY AMOUNT CAPITAL DURATION INTEREST
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Cicobail Aubry 12,626.1 9,048.6 21.5 semesters 2,211.4
Sovac Aubry 109.7 61.4 9 quarters 4.4
Bail Materiel Socori 1,580.0 900.2 30 months 92.0
- ----------------------------------------------------------------------------------------------------------------
TOTAL 14,315.8 10,010.2 2,307.8
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
F-17
<PAGE> 21
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 9 - OTHER LIABILITIES
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------- -----------------------
DESIGNATION MONTANT MONTANT
In Thousand French Francs AU 30/09/1998 AU 31/12/1997
- ----------------------------------------------------------------------------------------- -----------------------
<S> <C> <C>
- - Customer prepayments 12,018.1 59,156.3
- - Continuation plan liabilities 386,768.6
- - Other liabilities 61,508.0 474,910.7
- ----------------------------------------------------------------------------------------- -----------------------
TOTAL 460,294.7 534,067.0
- ----------------------------------------------------------------------------------------- -----------------------
</TABLE>
See Note 1 for a definition of these liabilities and their reimbursement terms.
The "Continuation Plan Liabilities" do not take into account the subsequent
modifications of these liabilities after September 30, 1998. As of December 31,
1998, "Continuation Plan Liabilities" amount to 371,278.2 thousand French
Francs.
F-18
<PAGE> 22
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 10 - SALES
<TABLE>
<CAPTION>
------------------------------------------------
AS OF SEPTEMBER 30, 1998
- -------------------------------------------------------------------------------------------------------------
CONSOLIDATED
SALES BY ENTITY TOTAL SALES GROUP SALES SALES
In Thousand French Francs 1 2 1-2
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- - COFIMETA 39,995.1 39,580.1 415.0
- - AUBRY 214,147.2 4,317.0 209,830.2
- - ECRIM 242,279.4 29,760.6 212,518.8
- - SOMENOR 534,049.8 21,136.3 512,913.5
- - SOCORI 10,997.7 1,605.3 9,392.4
- -------------------------------------------------------------------------------------------------------------
TOTAL 1,041,469.2 96,399.3 945,069.9
- -------------------------------------------------------------------------------------------------------------
</TABLE>
CONSOLIDATED SALES BY NATURE
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
SALES OF
SALES BY NATURE GOODS FOR PRODUCTION SERVICES TOTAL
In Thousand French Francs RESALE SOLD
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - COFIMETA 415.0 415.0
- - AUBRY 209,333.9 496.3 209,830.2
- - ECRIM 7,908.6 204,590.0 20.2 212,518.8
- - SOMENOR 511,907.8 1,005.7 512,913.5
- - SOCORI 9,392.4 9,392.4
- -------------------------------------------------------------------------------------------------------------
TOTAL 8,323.6 925,831.7 10,914.6 945,069.9
- -------------------------------------------------------------------------------------------------------------
</TABLE>
CONSOLIDATED SALES BY ZONE
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
SALES BY GEOGRAPHICAL ZONE FRANCE EU OTHERS TOTAL
In thousands French Francs
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - COFIMETA 415.0 415.0
- - AUBRY 188,773.5 21,056.7 209,830.2
- - ECRIM 164,295.7 39,509.4 8,713.7 212,518.8
- - SOMENOR 490,319.9 13,909.8 8,683.8 512,913.5
- - SOCORI 9,392.4 9,392.4
- -------------------------------------------------------------------------------------------------------------
TOTAL 853,196.5 74,475.9 17,397.5 945,069.9
- -------------------------------------------------------------------------------------------------------------
</TABLE>
F-19
<PAGE> 23
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 10 - SALES
<TABLE>
<CAPTION>
---------------------------------------------
AS OF DECEMBER 31, 1997
- ----------------------------------------------------------------------------------------------------------------------
CONSOLIDATED
SALES BY ENTITY TOTAL SALES GROUP SALES sales
In thousands French Francs 1 2 1-2
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- - COFIMETA 21,922.5 20,191.1 1,731.4
- - AUBRY 310,958.0 5,567.9 305,390.1
- - ECRIM 313,997.6 18,287.1 295,710.5
- - SOMENOR 677,572.4 81,023.7 596,548.7
- - SOCORI 22,117.2 1,945.9 20,171.3
- ----------------------------------------------------------------------------------------------------------------------
TOTAL 1,346,567.7 127,015.7 1,219,552.0
</TABLE>
CONSOLIDATED SALES BY NATURE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
SALES OF
SALES BY NATURE GOODS FOR PRODUCTION SERVICES TOTAL
In thousands French Francs RESALE SOLD
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - COFIMETA 514.6 1,216.8 1,731.4
- - AUBRY 305,225.5 164.6 305,390.1
- - ECRIM 43,045.9 251,974.9 689.7 295,710.5
- - SOMENOR 596,390.3 158.4 596,548.7
- - SOCORI 20,171.3 20,171.3
- --------------------------------------------------------------------------------------------------------------------------
TOTAL 43,560.5 1,153,590.7 22,400.8 1,219,552.0
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
CONSOLIDATED SALES BY ZONES
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
SALES BY GEOGRAPHICAL ZONE FRANCE EU OTHERS TOTAL
In thousands French Francs
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - COFIMETA 1,731.4 1,731.4
- - AUBRY 271,536.8 32,412.4 1,440.9 305,390.1
- - ECRIM 239,522.1 46,661.2 9,527.2 295,710.5
- - SOMENOR 580,963.9 8,369.4 7,215.4 596,548.7
- - SOCORI 20,171.3 20,171.3
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL 1,113,925.5 87,443.0 18,183.5 1,219,552.0
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
F-20
<PAGE> 24
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 10 - SALES
<TABLE>
<CAPTION>
-----------------------------------------------
AS OF DECEMBER 31, 1996
- ------------------------------------------------------------------------------------------------------------------------
SALES BY ENTITY CONSOLIDATED
In thousands French Francs TOTAL SALES GROUP SALES SALES
1 2 1-2
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- - COFIMETA 36,393.7 29,867.7 6,526.0
- - AUBRY 207,885.5 4,321.5 203,564.0
- - ECRIM 265,428.5 8,098.5 257,330.0
- - SOMENOR 613,844.8 58,194.8 555,650.0
- - SOCORI 31,563.7 9,715.7 21,848.0
- ------------------------------------------------------------------------------------------------------------------------
TOTAL 1,155,116.2 110,198.2 1,044,918.0
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
CONSOLIDATED SALES BY NATURE
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
SALES BY NATURE SALES OF
In thousands French Francs GOODS FOR PRODUCTION SERVICES TOTAL
RESALE SOLD
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - COFIMETA 2,785.9 3,740.1 6,526.0
- - AUBRY 201,873.8 1,690.2 203,564.0
- - ECRIM 42,838.7 213,754.2 737.1 257,330.0
- - SOMENOR 554,149.2 1,500.8 555,650.0
- - SOCORI 343.0 21,505.0 21,848.0
- -----------------------------------------------------------------------------------------------------------------------
TOTAL 45,967.6 969,777.2 29,173.2 1,044,918.0
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
CONSOLIDATED SALES BY ZONE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------------
SALES BY ZONE FRANCE OTHERS TOTAL
In thousands French Francs
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- - COFIMETA 5,711.8 814.2 6,526.0
- - AUBRY 170,062.5 33,501.5 203,564.0
- - ECRIM 207,565.8 49,764.2 257,330.0
- - SOMENOR 532,446.1 23,203.9 555,650.0
- - SOCORI 21,814.6 33.4 21,848.0
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL 937,600.8 107,317.2 1,044,918.0
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
F-21
<PAGE> 25
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 11 - OTHER INCOME
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------- ----------------- ------------------
DESIGNATION AMOUNT AMOUNT AMOUNT
In Thousand French Francs SEPTEMBER 30, 1998 DECEMBER 31, 1997 DECEMBER 31, 1996
- ---------------------------------------------------------------------------------- ----------------- ------------------
<S> <C> <C> <C>
- - Operating subsidies 163.5 279.0 1,139.0
- - Reversals of reserves and transfer of charges (1) 11,971.8 38,473.0 7,568.0
- - Other income 4,183.9 1,817.0 55.0
- --------------------------------------------------------------------------------- ----------------- ------------------
TOTAL OTHER INCOME 16,319.2 40,569.0 8,762.0
- --------------------------------------------------------------------------------- ----------------- ------------------
</TABLE>
(1) Mainly comprises reversals of inventory reserves and bad debt
allowances.
F-22
<PAGE> 26
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 12 - BREAKDOWN OF FINANCIAL INCOME / (LOSS)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------- ----------------- -----------------
DESIGNATION AMOUNT AMOUNT AMOUNT
In Thousand French Francs SEPTEMBER 30, 1998 DECEMBER 31, 1997 DECEMBER 31, 1996
- ---------------------------------------------------------------------------------- ----------------- -----------------
<S> <C> <C> <C>
- - Short term investments 250.8 450.0 3.0
- - Other interest income and related income 5,058.1 5,842.0 1,527.0
- - Reversal of depreciation and transfer of charges 6.0 657.0
- - Currency exchange gains 17.6 108.0 1,346.0
- ----------------------------------------------------------------------------------- ----------------- -----------------
TOTAL FINANCIAL INCOME 5,332.5 7,057.0 2,876.0
- ----------------------------------------------------------------------------------- ----------------- -----------------
- - Increase in depreciation and transfer of charges 295.0 987.0
- - Interest expense and related charges 9,515.5 18,172.0 16,071.0
- - Currency exchange losses 46.2 498.0 35.0
- ----------------------------------------------------------------------------------- ----------------- -----------------
TOTAL FINANCIAL CHARGES 9,561.7 18,965.0 17,093.0
- ----------------------------------------------------------------------------------- ----------------- -----------------
FINANCIAL INCOME / (LOSS) (4,229.2) (11,908.0) (14,217.0)
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
F-23
<PAGE> 27
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 13 - BREAKDOWN OF EXTRAORDINARY INCOME / (LOSS)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
DESIGNATION AMOUNT AMOUNT AMOUNT
In Thousand French Francs SEPTEMBER 30, 1998 DECEMBER 31, 1997 DECEMBER 31, 1996
- -------------------------------------------------------------------------------- ----------------- -----------------
<S> <C> <C> <C>
Extraordinary income from operating transactions 14,250.1 1,700.0 7,745.0
Extraordinary income from capital transactions 693.2 1,902.0 2,460.0
Reversal of extraordinary provisions and depreciation 29,708.8 500.0 5,028.0
- -------------------------------------------------------------------------------- ----------------- -----------------
TOTAL EXTRAORDINARY INCOME 44,652.1 4,102.0 15,233.0
- -------------------------------------------------------------------------------- ----------------- -----------------
Extraordinary charges from operating transactions 17,216.2 27,602.0 20,122.0
Extraordinary charges from capital transactions 960.5 1,481.0 5,132.0
Additions to extraordinary provisions and depreciation 25,223.6 70,122.0 7,322.0
- -------------------------------------------------------------------------------- ----------------- -----------------
TOTAL EXTRAORDINARY CHARGES 43,400.3 99,205.0 32,576.0
- -------------------------------------------------------------------------------- ----------------- -----------------
EXTRAORDINARY INCOME / (LOSS) 1,251.8 (95,103.0) (17,343.0)
- -------------------------------------------------------------------------------- ----------------- -----------------
</TABLE>
Extraordinary income mainly includes :
- - utilization of provisions for restructuring
- - utilization of provisions for customer and supplier litigations
- - supplier accounts which have not been claimed under the Continuation Plan and
are no longer considered as valid claims.
- - insurance indemnities.
Extraordinary charges mainly include :
- - restructuring costs (mainly employee costs)
- - legal fees in connection with the Continuation Plan
- - provisions for depreciation of old accounts receivable
F-24
<PAGE> 28
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 14 - NET INCOME
The contribution of each legal entity to the consolidated net income is as
follows :
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------- ------------------- -------------------
LEGAL ENTITIES NET INCOME / (LOSS) NET INCOME / (LOSS) NET INCOME / (LOSS)
In Thousand French Francs SEPTEMBER 30, 1998 DECEMBER 31, 1997 DECEMBER 31, 1996
- -------------------------------------------------------------------------- ------------------- -------------------
<S> <C> <C> <C>
- - COFIMETA 6,547.4 (40,315.5) (1,386.0)
- - AUBRY 1,645.8 (5,709.2) (40,395.0)
- - ECRIM 98.4 3,207.6 (3,103.0)
- - SOMENOR 4,148.1 (68,628.7) (74,976.0)
- - SOCORI (1,991.7) (27,860.2) (8,191.0)
- ------------------------------------------------------------------------ ------------------ ------------------
CONSOLIDATED NET INCOME 10,448.0 (139,306.0) (128,051.0)
- ------------------------------------------------------------------------ ------------------ ------------------
</TABLE>
F-25
<PAGE> 29
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 15 - HEADCOUNT
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------
AS OF SEPTEMBER 30, 1998
--------------------------------------------------------------------------------------
DEFINED
CATEGORIES MANAGERS EMPLOYEES WORKERS TERM TOTAL INTERIM
CONTRACTS REGISTERED
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- - COFIMETA 26 5 2 33
- - AUBRY 12 63 253 328 64
- - ECRIM 10 59 237 18 324 56
- - SOMENOR 25 109 574 708 43
- - SOCORI 11 31 1 43 1
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL HEADCOUNT 84 267 1,064 21 1,436 164
- ------------------------------------------------------------------------------------------------------------------------------
As of December 31, 1997 106 264 1,035 8 1,413 45
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
No compensation is given to members of the management board.
F-26
<PAGE> 30
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 16 - EXISTING AMOUNTS RECEIVABLE AND PAYABLE BETWEEN COFIMETA AND GROUPS
ARBEL AND VALFOND
As of September 30, 1998 the amounts receivable from Group ARBEL are as follows:
- ARBEL INDUSTRIE 43,210 thousand FF,
- other ARBEL affiliates 4,775 thousand FF.
As of February 3rd, 1999, the amounts are as follows :
- ARBEL INDUSTRIE 43,832 thousand FF,
- other ARBEL affiliates 2,115 thousand FF.
Accounts payable to Group VALFOND amount to :
- as of September 30, 1998 53,498 thousand FF,
- as of February 3rd, 1999 52,966 thousand FF.
Those accounts receivable and payable will be paid or compensated at the date of
closing which will take place on February 5th, 1999.
F-27
<PAGE> 31
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 17 - DIFFERENCES BETWEEN GENERALLY ACCEPTED PRINCIPLES IN FRANCE
AND IN THE UNITED STATES
Differences between generally accepted accounting principles in France and in
the United States.
The consolidated financial statements of COFIMETA S.A. and its subsidiaries have
been prepared in accordance with French accounting principles which differ in
certain material respects from generally accepted accounting principles in the
United States. The principal differences as they relate to the consolidated net
income and the consolidated equity of COFIMETA and its subsidiaries are
summarized below :
Reconciliation of net income to US GAAP
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
Nine months period Year ended
In thousands of FRF ended September 30, December 31, 1997
1998
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net income (loss) as reported 10,447 (139,283)
1. Provisions for restructuring (2,700) 37,052
recorded in the year-ended 31
December 1997
2. Provisions for restructuring 3,878
recorded in the nine-month period
ended 30 September 1998
3. Mark-to-market adjustment on 247
Investment Funds shares
- ------------------------------------------------------------------------------------------------------
Net income (loss) as adjusted for 11,872 (102,231)
US GAAP
- ------------------------------------------------------------------------------------------------------
</TABLE>
1 - In 1997, provisions for restructuring reserves have been recorded under
French GAAP, however since they do not meet the EITF 94-3 criteria, they are
not allowed under US GAAP.
During the nine-month period ended September 30, 1998, an amount of KFF 2,
700 has been taken back into income under French GAAP and therefore should
be deducted from the net income for US GAAP purposes.
F-28
<PAGE> 32
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
2- Additional provisions for restructuring have been recorded as at September
30, 1998 for an amount of KFF 3, 878 which do not meet the EITF 94-3
criteria and therefore are not allowed under US GAAP.
3- A potential gain of KFF 247 on Investments Funds shares could not be
recorded under French GAAP but should be recorded in income following the
mark-to-market rule under US GAAP.
Reconciliation of Shareholder's equity to US GAAP
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
In thousands of FRF September 30, 1998 December 31, 1997
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
Shareholder's equity as reported (21,963) 117,321
1. Retirement indemnities (15,772) (15,772)
2. Adjustments to equity (11,876) (11,876)
- -----------------------------------------------------------------------------------------------------
Shareholder's equity as adjusted for (49,611) 89,673
US GAAP
- -----------------------------------------------------------------------------------------------------
</TABLE>
1 - Retirement liabilities are disclosed in the footnotes but not recorded as
permitted by French GAAP ; under US GAAP, they must be recorded.
2 - As described in Note 1, Groupe VALFOND acquired Groupe COFIMETA in December
30, 1997. As permitted by French GAAP, Groupe VALFOND did not allocate the
purchase price to the fair values of assets acquired and liabilities
assumed. VALFOND carried over the historical net book values of assets and
liabilities of COFIMETA and recorded a cumulative adjustment for KF 11,876.
The difference of KF 52,520 between the purchase price of COFIMETA and the
net book value of net assets acquired was recorded as Goodwill in the
financial statements of VALFOND. It was not pushed down to COFIMETA.
Under US GAAP, the purchase price should be allocated to the fair values of
the assets acquired and liabilities assumed, and such cumulative effects
adjustments would not be permitted. The excess purchase price would
therefore generally result in the step up of certain assets, with the
residual amount recorded as goodwill.
F-29
<PAGE> 33
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
Also, in general the purchase price of a company should be pushed down
(reflected) in its separate financial statements if at least 95% of its
shares have been acquired by another company. Such pushdown accounting is
not permitted if less than 80% of its shares have been purchased. If between
80% and 95% of its shares have been purchased, pushdown accounting is
optional.
Had this excess purchase price been pushed down to COFIMETA and so allocated
to certain assets and goodwill with an average estimated remaining useful
life of 20 years, under US GAAP there would be an additional annual charge
for depreciation and amortization of approximately KF 2,600 (9 months :
1,950). If this entire excess purchase price were considered to be Goodwill
with a 40 years life the additional annual amortization charge would be
approximately KF 1,300 (9 months : 975).
F-30
<PAGE> 34
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 18 - CONTINGENT LIABILITIES (EXCEPT FOR CAPITAL LEASES)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------- -------------------------
DESIGNATION AMOUNT AMOUNT
In Thousand French Francs SEPTEMBER 30, 1998 DECEMBER 31, 1997
- ------------------------------------------------------------------------------------- -------------------------
<S> <C> <C>
- - Retirement indemnities 15,771.6 15,771.6
- - Discounted notes not yet matured 18,915.8 -
- ------------------------------------------------------------------------------------- -------------------------
TOTAL 34,687.4 15,771.6
- ------------------------------------------------------------------------------------- -------------------------
</TABLE>
F-31
<PAGE> 35
COFIMETA SA
CONSOLIDATED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 1998
NOTE 19 - POST BALANCE SHEETS EVENTS
As at 5th February 1999, OXFORD AUTOMOTIVE has acquired 100% of the shares of
COFIMETA S.A. As part of closing of this transaction, the accounts receivable
and payable between COFIMETA, Groupe VALFOND and Groupe ARBEL have been settled.
The shareholders should also agree to change the year-end of the Company to 31st
March.
F-32
<PAGE> 36
PRO FORMA COMBINED FINANCIAL DATA
(Unaudited)
(Dollars in thousands)
The unaudited pro forma combined balance sheet as of December 31, 1998 (the
"Unaudited Pro Forma Balance Sheet") gives pro forma effect to the acquisition
of Cofimeta S.A. ("Cofimeta") as if it had occurred on December 31, 1998. The
acquisition of Cofimeta is accounted for by the purchase method of accounting
pursuant to which the purchase price is allocated among the acquired tangible
and intangible assets and assumed liabilities in accordance with estimates of
their fair values on the date of acquisition. The pro forma adjustments
represent management's preliminary determination of purchase accounting
adjustments and are based upon available information and certain assumptions
that the Company believes to be reasonable under the circumstances.
Consequently, the amounts reflected in the Unaudited Pro Forma Balance Sheet
are subject to change and the final values may differ substantially from these
amounts. Management does not expect that differences between the preliminary and
final purchase price allocation will have a material impact on the Company's
financial position. The Unaudited Pro Forma Balance Sheet does not purport to
be indicative of the financial position of the Company had such transaction
actually been completed as of the assumed date and for the period presented, or
which may be obtained in the future.
The unaudited pro forma combined statement of operations for the year ended
March 31, 1998 gives pro forma effect to the Company's issuance of $125 million
of 10 1/8% Senior Subordinated Notes Due 2007 (the "Series A offering") on June
24, 1997, the Company's issuance of $35 million of 10 1/8% Senior Subordinated
Notes Due 2007, Series B (the "Series B Offering") on April 1, 1998, the
Company's issuance of $40 million of 10 1/8% Senior Subordinated Notes Due 2007,
Series C (the "Series C Offering") on December 8, 1998, and the acquisitions of
Cofimeta, Howell Industries, Inc. ("Howell"), RPI Holdings Inc. ("RPIH") and
the Eaton Corporation Suspension Division (the "Suspension Division") as if
they had occurred on April 1, 1997. The unaudited pro forma combined statement
of operations for the nine months ended December 31, 1998 gives pro forma
effect to the Series C Offering and the acquisition of Cofimeta, as if each
had occurred April 1, 1998. The unaudited pro forma combined statements of
operations for the year ended March 31, 1998 and for the nine months ended
December 31, 1998 are collectively referred to as the "Unaudited Pro Forma
Statements of Operations." The Unaudited Pro Forma Statements of Operations do
not purport to be indicative of the results of operations of the Company had
such transactions actually been completed as of the assumed dates and for the
periods presented, or which may be obtained in the future.
F-33
<PAGE> 37
UNAUDITED PRO FORMA COMBINED BALANCE SHEET AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
Company Cofimeta Pro Forma Pro Forma
Dec. 31, 1998 Sep. 30, 1998(a) Adjustments Combined
------------- ---------------- ----------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
Cash and cash equivalents................ $ 318 $ 8,303 $ $ 8,621
Trade accounts receivable, net .......... 86,336 26,240 (869)(c) 111,707
Inventories ............................. 33,911 18,917 (869)(c) 51,959
Reimbursable tooling .................... 40,237 -- -- 40,237
Unexpended bond proceeds ................ 6 -- -- 6
Prepaid expenses and other current
assets ................................ 3,630 48,239 (8,336)(c) 43,533
Deferred income taxes ................... 4,399 4,399
--------- --------- --------- ---------
Total current assets ............... 168,837 101,699 (10,074) 260,462
Deferred income taxes ................... 7,918 -- 12,176 (d) 20,094
Property, plant and equipment,
net ................................... 191,446 24,534 (1,199)(c) 214,781
Marketable Securities ................... 8,092 -- -- 8,092
Other noncurrent assets ................. 36,269 453 -- 36,722
--------- --------- --------- ---------
Total assets ....................... $ 412,562 $ 126,686 $ 903 $ 540,151
========= ========= ========= =========
Trade accounts payable .................. $ 54,428 $ 29,177 $ 173 (c) $ 83,778
Accrued expenses and other
liabilities........................... 20,918 13,348 -- 34,266
Restructuring reserve ................... 3,019 1,423 13,781 (c) 18,223
Current portion of long-term debt ....... 3,411 -- 6,568 (b) 9,979
--------- --------- --------- ---------
Total current liabilities .......... 81,776 43,948 20,522 146,246
Deferred income taxes ................... 13,962 -- -- 13,962
Pension liability ....................... 5,470 2,740 8,210
Postretirement medical benefits ......... 41,427 -- -- 41,427
Other noncurrent liabilities ............ 3,870 12,928 (9,294)(c) 7,504
Long-term debt .......................... 227,549 67,190 (10,445)(b) 284,294
--------- --------- --------- ---------
Total liabilities .................. 374,054 126,806 783 501,643
--------- --------- --------- ---------
Redeemable Series A preferred
stock ................................. 40,586 -- -- 40,586
Total shareholders' equity ......... (2,078) (120) 120 (c) (2,078)
--------- --------- --------- ---------
Total liabilities and
shareholders' equity .............. $ 412,562 $ 126,686 $ 903 $ 540,151
========= ========= ========= =========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Combined Balance Sheet.
F-34
<PAGE> 38
NOTES TO UNAUDITED PRO FORMA COMBINED BALANCE SHEET
(Dollars in thousands)
<TABLE>
<S> <C>
(a) Represents the balance sheet of Cofimeta at September 30, 1998. The
September 30, 1998 balance sheet for Cofimeta was derived from
Cofimeta's audited financial statements.
(b) Reflects the following estimated sources and uses of funds for the
acquisition of Cofimeta as if it had occurred on December 31, 1998:
Purchase price paid at closing (including estimated closing costs) $37,625
Deferred share price and debt purchase - recorded at
net present value as of the closing date 19,452
Reduction of face value of indebtedness as a part of acquisition
and in conjunction with the Continuation Plan (60,954)
--------
Net reduction in total debt $ (3,877)
Less: net increase in current portion of debt 6,568
--------
Net reduction in long-term debt $(10,445)
(c) The acquisition of Cofimeta will be accounted for by the purchase ========
method of accounting, pursuant to which the purchase price is allocated
among the acquired tangible and intangible assets and assumed
liabilities in accordance with their estimated fair market values on
the date of acquisition. The estimated purchase price and preliminary
adjustments to historical book value of Cofimeta as a result of the
transaction are as follows:
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
Reserves recorded to conform accounting policies of the
Company with those of Cofimeta
Allowance for bad debt reserve........................... (869)
Inventory obsolescence reserve........................... (869) (1,738)
----
Elimination of inter-company receivable, settled as a part
of acquisition price.............................. (8,336)
Recording of deferred tax asset on net operating losses
acquired.......................................... 12,176
Write-down of property plant and equipment for capital
portion of restructuring reserves................. (1,199)
------
Net increase in assets................................... $903
====
Elimination of inter-company payable, settled as a part of
acquisition price................................. (9,294)
Reserves recorded to conform accounting policies of the
Company with those of Cofimeta
Accounts payable unrecorded liability reserve............ 173
Increase in restructuring reserve
Plant restructuring and closure.......................... 10,689
Other reserves........................................... 3,092 13,781
-----
Net reduction of indebtedness as a part of acquisition... (3,877)
Elimination of retained earnings as a result of purchase
accounting........... ............................ 120
---
Net increase in liabilities and shareholders equity..... $903
====
</TABLE>
(d) The deferred tax asset can be realized in accordance with FAS 109 only
by the operations in France, not on a consolidated basis with U.S. or
Canadian operations.
F-35
<PAGE> 39
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
COMPANY HOWELL RPIH
COMPANY(a) PRO FORMA PRO FORMA(e) PRO FORMA (f)
---------- --------- ------------ -------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
MAR. 31, 1998 MAR. 31, 1998 MAR. 31,1998 MAR. 31, 1998
------------- ------------- ------------ -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
Net sales .................... $410,321 $ - $ 34,329 $ 9,035
Cost of sales ................ 368,420 - 31,189 10,642
--------- --------- --------- ---------
Gross profit ................. 41,901 - 3,140 (1,607)
Selling, general and
administrative expenses .... 21,839 37 (b) 1,651 177
Reorganization cost........... - - - -
Restructuring provision ...... 1,610 - - -
Gain on sale of equipment .... (1,602) - - -
--------- --------- --------- ---------
Income (loss) from
Operations ................. 20,054 (37) 1,489 (1,784)
Interest expense, net ........ 10,710 (431) (c) 858 432
Other income (expense) ....... 321 - - (35)
--------- --------- --------- ---------
Income (loss) before income
taxes ...................... 9,665 394 631 (2,251)
Provision (benefit) for income
taxes ...................... 4,074 158 (d) 269 (846)
--------- --------- --------- ---------
Net income (loss) ............ 5,591 $ 236 $ 362 $ (1,405)
========= ========= ========= =========
FINANCIAL RATIOS AND
OTHER DATA:
Depreciation and
amortization ............... $20,279 $ 37 $ 769 $ 296
Capital expenditures ......... 16,723 - 728 119
Ratio of earnings to fixed
charges (i) ................ 1.7x
EBITDA(j) .................... 40,654 - 2,258 (1,523)
Ratio of EBITDA to
interest expense(k) ........ 3.8x
Ratio of net debt to
EBITDA(l) .................. 3.0x
</TABLE>
<TABLE>
<CAPTION>
SUSPENSION COFIMETA
DIVISION PRO PRO FORMA
PRO FORMA (g) FORMA (h) COMBINED
------------- --------- --------
YEAR ENDED YEAR ENDED YEAR ENDED
MAR. 31, 1998 DEC. 31, 1997 MAR. 31, 1998
------------- ------------- -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Net sales .................... $ 122,478 $ 189,031 $ 765,194
Cost of sales ................ 114,721 182,780 707,752
--------- --------- ---------
Gross profit ................. 7,757 6,251 57,442
Selling, general and
administrative expenses .... 7,545 14,789 46,038
Reorganization cost........... - 1,158 1,158
Restructuring provision ...... - 6,153 7,763
Gain on sale of equipment .... - (1,602)
--------- --------- ---------
Income (loss) from Operations 212 (15,849) 4,085
Interest expense, net ........ 5,108 7,585 24,262
Other income (expense) ....... 860 5 1,151
--------- --------- ---------
Income (loss) before income
taxes ...................... (4,036) (23,429) (19,026)
Provision (benefit) for income
taxes ...................... (1,612) (9,372) (7,329)
--------- --------- ---------
Net income (loss) ............ $ (2,424) (14,057) $ (11,697)
========= ========= =========
FINANCIAL RATIOS AND
OTHER DATA:
Depreciation and amortization $ 4,641 9,535 $ 35,557
Capital expenditures ......... 5,761 1,884 25,215
Ratio of earnings to fixed
charges (i) ................
EBITDA (j) ................ 5,713 (6,309) 40,793
Ratio of EBITDA to
interest expense(k) ........ 1.7x
Ratio of net debt to
EBITDA(l) ..................
</TABLE>
See accompanying Notes to Unaudited Pro Forma Combined Statement of Operations.
F-36
<PAGE> 40
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
COMPANY COFIMETA PRO FORMA
COMPANY PRO FORMA PRO FORMA (o) COMBINED
------- --------- --------- --------
NINE MONTHS NINE MONTHS NINE MONTHS NINE MONTHS
ENDED ENDED ENDED ENDED
DEC. 31, 1998 DEC. 31,1998 SEP. 30, 1998 DEC. 31, 1998
------------- ------------ ------------- -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
Net sales $408,144 $ $147,107 $ 555,251
Cost of sales 372,612 136,355 508,967
--------- -------- -------- ---------
Gross profit 35,532 10,752 46,284
Selling, general and
administrative expenses 22,235 9,656 31,891
Reorganization costs - - (1,350) (1,350)
Restructuring provision 1,176 95 1,271
Gain on sale of equipment --
-------- -------- -------- ---------
Income (loss) from Operations 12,121 2,351 14,472
Interest expense, net 14,255 (422)(m) 4,735 18,568
Other income (expense) 949 13 962
-------- -------- -------- ---------
Income (loss) before income
taxes (1,185) 422 (2,371) (3,134)
Provision (benefit) for income
taxes (475) 169(n) (948) (1,254)
---------- -------- -------- ---------
Net income (loss) $ (710) $ 253 $ (1,423) $ (1,880)
========= ======== ======== =========
FINANCIAL RATIOS AND
OTHER DATA:
Depreciation and amortization $ 19,552 $ $ 6,607 $ 26,159
Capital expenditures
Ratio of earnings to fixed
charges (i) -- --
EBITDA (j) 32,622 8,971 41,593
Ratio of EBITDA to
interest expense(k) 2.3x 2.2x
Ratio of net debt to 5.3x 5.2x
EBITDA(l)
</TABLE>
See accompanying Notes to Unaudited Pro Forma Combined Statements of
Operations.
F-37
<PAGE> 41
NOTES TO UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
(a) Statement of Operations Data for the Company for the year ended March
31, 1998 includes operating data for Howell and RPIH for the periods
subsequent to acquisition (Howell - August 14, 1997 to March 31, 1998
and RPIH - November 26, 1997 to March 31, 1998).
(b) Represents amortization of bond acquisition fees associated with the
Series A Notes.
(c) Represents the net effect on interest expense as a result of (1) the
elimination of historical interest expense after the repayment of the
existing senior bank credit facilities and other outstanding debt,
using proceeds from the Series A Offering and (2) the Series A, Series
B and Series C Offerings, using an interest rate of 10.125% per annum
for the Series A Notes and 9.25% per annum for the Series B Notes and
9.685% for the Series C Notes. This amount excludes interest on the
portion of the proceeds of the Series A, Series B and Series C
Offerings used for the Howell, RPIH, Suspension Division and Cofimeta
acquisitions as follows:
<TABLE>
<S> <C>
Interest differential historical versus Offerings $8,507
Acquisition of:
Howell (884)
RPI (169)
Suspension (4,075)
Cofimeta (3,810)
------
$ (431)
======
See Notes (e)(4), (f)(4), (g)(3) and (h)(4).
</TABLE>
(d) Represents the estimated income tax effect of the pro forma adjustments
using an effective tax rate of 40%.
(e) The Howell Pro Forma information includes Statement of Operations data
for Howell as if the Company had acquired Howell on April 1, 1997:
<TABLE>
<CAPTION>
PRO FORMA HOWELL
HOWELL(1) ADJUSTMENTS PRO FORMA
--------- ----------- ---------
PERIOD FROM PERIOD FROM PERIOD FROM
APRIL 1, 1997 APRIL 1, 1997 APRIL 1, 1997
THROUGH THROUGH THROUGH
AUGUST 13, 1997 AUGUST 13, 1997 AUGUST 13, 1997
--------------- --------------- ---------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Net sales $34,329 $ - $34,329
Cost of sales 31,070 119 (2) 31,189
------- ------- -------
Gross profit 3,259 (119) 3,140
Selling, general and administrative expenses 1,626 25 (3) 1,651
Reorganization cost - - -
Restructuring provision - - -
Gain on sale of equipment - - -
------- ------- -------
Income (loss) from operations 1,633 (144) 1,489
Interest expense, net (26) 884 (4) 858
Other income (expense) - - -
------- ------- -------
Income (loss) before income taxes 1,659 (1,028) 631
Provision (benefit) for income taxes 680 (411) (5) 269
------- ------- -------
Net income (loss) $ 979 $ (617) $ 362
======= ======= =======
</TABLE>
F-38
<PAGE> 42
(1) Statement of Operations data for Howell for the period prior
to acquisition by the Company (April 1, 1997 - August 13,
1997). The information was derived from Howell's unaudited
internal financial statements.
(2) Represents increased depreciation expense as a result of the
write up of property, plant and equipment to fair market value
as a part of the purchase accounting related to the
acquisition of Howell.
(3) Represents amortization of acquisition expenses related to the
Howell acquisition.
(4) Represents the net effect on interest expense as a result of
the use of proceeds from the Series A Offering for the
acquisition of Howell of $23,245. Interest expense is
calculated using an interest rate of 10.125% per annum. See
Note (c).
(5) Represents the estimated income tax effect of the pro forma
adjustments using an effective tax rate of 40%.
(f) The RPIH Pro Forma information includes Statement of Operations data as
if the Company had acquired RPIH on April 1, 1997:
<TABLE>
<CAPTION>
PRO FORMA RPIH
RPIH(1) ADJUSTMENTS PRO FORMA
----------------- ----------------- -----------------
PERIOD FROM PERIOD FROM PERIOD FROM
APRIL 1, 1997 APRIL 1, 1997 APRIL 1, 1997
THROUGH THROUGH THROUGH
NOVEMBER 25, 1997 NOVEMBER 25, 1997 NOVEMBER 25, 1997
----------------- ----------------- -----------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Net sales $ 9,035 $ - $ 9,035
Cost of sales 10,602 40 (2) 10,642
-------- ------- --------
Gross profit (1,567) (40) (1,607)
Selling, general and administrative expenses 127 50 (3) 177
Reorganization cost - - -
Restructuring provision - - -
Gain on sale of equipment - - -
-------- ------- --------
Income (loss) from operations (1,694) (90) (1,784)
Interest expense, net 263 169 (4) 432
Other income (expense) (35) - (35)
-------- ------- --------
Income (loss) before income taxes (1,992) (259) (2,251)
Provision (benefit) for income taxes (742) (104) (5) (846)
-------- ------- --------
Net income (loss) $ (1,250) $ (155) $ (1,405)
======== ======= ========
</TABLE>
(1) Statement of Operations data for RPIH for the period prior to
acquisition by the Company (April 1, 1997 to November 25,
1997). The information was derived from RPIH's unaudited
internal financial statements.
(2) Represents increased depreciation expense as a result of the
write up of property, plant and equipment to fair market value
as a part of the purchase accounting related to the
acquisition of RPIH.
(3) Represents amortization of acquisition expenses and goodwill
related to the RPIH acquisition.
F-39
<PAGE> 43
(4) Represents the net effect on interest expense as a result of
the use of proceeds from the Series A Offering for the
acquisition of RPIH of $2,500. Interest expense is calculated
using an interest rate of 10.125% per annum. See Note (c).
(5) Represents the estimated income tax effect of the pro forma
adjustments using an effective tax rate of 40%.
(g) The Suspension Division Pro Forma information includes Statement of
Operations data as if the Company had acquired the Suspension Division
on April 1, 1997:
<TABLE>
<CAPTION>
SUSPENSION
SUSPENSION PRO FORMA DIVISION
DIVISION(1) ADJUSTMENTS PRO FORMA
------------- ------------- -------------
PERIOD FROM PERIOD FROM PERIOD FROM
APR. 1, 1997 - APR. 1, 1997 - APR. 1, 1997 -
MAR. 31, 1998 MAR. 31, 1998 MAR. 31, 1998
------------- ------------- -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Net sales $ 122,478 $ - $ 122,478
Cost of sales 114,721 - 114,721
--------- ------------ ---------
Gross profit 7,757 - 7,757
Selling, general and administrative expenses 7,154 391 (2) 7,545
Reorganization cost - - -
Restructuring provision - - -
Gain on sale of equipment - - -
--------- ------------ ---------
Income (loss) from operations 603 (391) 212
Interest expense, net 1,033 4,075 (3) 5,108
Other income (expense) 860 - 860
--------- ------------ ---------
Income (loss) before income taxes 430 (4,466) (4,036)
Provision (benefit) for income taxes 174 (1,786) (4) (1,612)
--------- ------------ ---------
Net income (loss) $ 256 $ (2,680) $ (2,424)
========= =========== =========
</TABLE>
(1) Statement of Operations data for the Suspension Division for
the twelve months ended March 31, 1998 was derived from the
Suspension Division's unaudited internal financial statements.
(2) Represents amortization of acquisition expenses and goodwill
related to the Suspension Division acquisition.
(3) Represents the net effect on interest expense as a result of
the use of proceeds from the Series A and Series B Offerings
for the acquisition of the Suspension Division of $53,465.
Interest expense is calculated using an interest rate of
10.125% per annum for the Series A Notes and 9.25% per annum
for the Series B Notes. See Note (c).
(4) Represents the estimated income tax effect of the pro forma
adjustments using an effective tax rate of 40%.
F-40
<PAGE> 44
(h) The Cofimeta Pro Forma information includes Statement of Operations
data as if the Company had acquired Cofimeta on April 1, 1997:
<TABLE>
<CAPTION>
PRO FORMA COFIMETA
COFIMETA(1) ADJUSTMENTS PRO FORMA
----------- ----------- ---------
PERIOD FROM PERIOD FROM PERIOD FROM
JAN. 1, 1997 - JAN. 1, 1997 - JAN. 1, 1997 -
DEC. 31, 1997 DEC. 31, 1997 DEC. 31, 1997
------------- ------------- -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Net sales $ 189,031 $ $ 189,031
Cost of sales 181,985 795(2) 182,780
------------ ----------- -----------
Gross profit 7,046 (795) 6,251
Selling, general and administrative expenses 14,697 92(3) 14,789
Reorganization cost 1,158 - 1,158
Restructuring provision 6,153 6,153
Gain on sale of equipment - -
------------ ----------- -----------
Income (loss) from operations (14,962) (887) (15,849)
Interest expense, net 2,505 5,080(4) 7,585
Other income (expense) 5 5
------------ ----------- -----------
Income (loss) before income taxes (17,462) (5,967) (23,429)
Provision (benefit) for income taxes 17 (9,389)(5) (9,372)
------------ ----------- -----------
Net income (loss) $ (17,479) $ 3,422 $ (14,057)
============ =========== ===========
</TABLE>
(1) Statement of Operations data for Cofimeta for the period
January 1 to December 31, 1997 were derived from Cofimeta
audited financial statements.
(2) Represents increased depreciation expense as a result of the
conformance of accounting policies and depreciable lives
between the Company and Cofimeta.
(3) Represents amortization of debt issuance cost related to the
Series C bond issuance.
(4) Represents the net effect on interest expense as a result of
the following:
<TABLE>
<S> <C> <C>
Use of proceeds from the Series C offering for the
acquisition of Cofimeta of $37,625. Interest expense
is calculated using an interest rate of 10.125% per
annum - See Note C $3,810
Interest on deferred share purchase price in accordance
with the acquisition. Interest is calculated using an
effective interest rate of 10% per annum 941
Net effect on interest expense as a result of revaluation
of indebtedness as a part of the acquisition.
Includes deferred debt payments as well as
Continuation Plan indebtedness. 329
------
$5,080
======
</TABLE>
(5) Represents the estimated income tax effect of the pro forma
adjustments and restatement of the historical provision to
reflect the recording of a deferred tax asset during purchase
accounting using an effective tax rate of 40%.
(i) For purposes of this computation, earnings consist of income (loss)
before income taxes plus fixed charges. Fixed charges consist of
interest on indebtedness plus that portion of rental expense
representative of the interest factor. For the fiscal year ended March
31, 1998, on a pro forma basis for the Howell, RPIH, Suspension
Division and Cofimeta acquisitions, earnings were insufficient to cover
fixed charges by $19.0 million. For the nine months ended December 31,
1998, earnings were insufficient to cover fixed charges by $1.2
million. For the nine months ended December 31, 1998 on a pro forma
basis for the Cofimeta acquisition, earnings were insufficient to cover
fixed charges by $3.1 million.
(j) EBITDA is defined as income (loss) before interest, income taxes,
depreciation and amortization. EBITDA should not be construed as a
substitute for income from operations, net income or cash flow from
operating activities for the purpose of analyzing the Company's
operating performance, financial position and cash flows.
(k) Defined as the ratio of EBITDA to net interest expense.
(l) Ratio of net debt to EBITDA with net debt consisting of total debt less
cash and cash equivalents and unexpended bond proceeds.
F-41
<PAGE> 45
(m) Represents the net effect on interest expense as a result of the
elimination of historical interest expense after the repayment of
existing senior bank credit facilities, the issuance of the Series C
Notes and the acquisition of Cofimeta as follows:
Interest differential historical versus Series C $ 2,434
Acquisition of Cofimeta (2,856)
-------
$ (422)
=======
(n) Represents the estimated income tax effect of the pro forma adjustments
using an effective tax rate of 40%.
(O) The Cofimeta Pro Forma information includes Statement of Operations
data as if the Company had acquired Cofimeta on April 1, 1998:
<TABLE>
<CAPTION>
PRO FORMA COFIMETA
COFIMETA(1) ADJUSTMENTS PRO FORMA
----------- ----------- ---------
PERIOD FROM PERIOD FROM PERIOD FROM
JAN. 1, 1998 - JAN. 1, 1998 - JAN. 1, 1998 -
SEPTEMBER 30, 1998 SEPTEMBER 30, 1998 SEPTEMBER 30, 1998
------------------ ------------------ ------------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Net sales $ 147,107 $ $ 147,107
Cost of sales 135,773 582 136,355
--------- -------- ---------
Gross profit 11,334 (582) 10,752
Selling, general and administrative expenses 9,587 69 (3) 9,656
Reorganization Cost (1,350) - (1,350)
Restructuring provision 95 95
Gain on sale of equipment - -
--------- -------- ---------
Income (loss) from operations 3,002 (651) 2,351
Interest expense, net 980 3,755 (4) 4,735
Other income 13 - 13
--------- -------- ---------
Income (loss) before income taxes 2,035 (4,406) (2,371)
Provision (benefit) for income taxes 54 (1,002)(5) (948)
--------- -------- ---------
Net income (loss) $ 1,981 $ (3,404) $ (1,423)
========= ======== =========
</TABLE>
<TABLE>
<S> <C> <C>
(1) Statement of Operations data for Cofimeta for the period
January 1, 1998 to September 30, 1998 were derived from
Cofimeta Audited Financial Statements.
(2) Represents increased depreciation expense as a result of the
conformance of accounting policies and depreciation lives
between the Company and Cofimeta.
(3) Represents amortization of debt issue cost related to the
Series C Bond issuance.
(4) Represents the net effect on interest as result of following:
Use of proceeds from the Series C offering for the acquisition
of Cofimeta of $37,625. Interest expense is calculated using
an interest rate of 10.125% per annum - See Note C 2,856
Interest on deferred share purchase price in accordance with
the purchase agreement. Interest is calculated using an
effective interest rate of 10% per annum. 702
Net effect on interest expense as a result of revaluation of
indebtedness as a part of the acquisition. Includes deferred
debt payments as well as Continuation Plan indebtedness.
Interest expense is calculated using an effective interest
rate of 10% per annum. 197
------
$3,755
======
(5) Represents the estimated income tax effect of the pro forma
adjustments and restatement of the historical provision to
reflect the recording of a deferred tax asset during purchase
accounting using an effective rate of 40%.
</TABLE>
F-42
