<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------
FORM 8-K/A
(Amendment No. 1)
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 29, 1998
U.S.A. Floral Products, Inc.
(Exact Name of Registrant as Specified in Charter)
DELAWARE 000-23121 52-2030697
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
1025 Thomas Jefferson Street, N.W., Suite 300 East, 20007
Washington, D.C. (Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (202) 333-0800
<PAGE>
Item 2. Acquisition and Disposition of Assets.
As previously disclosed in a Current Report on Form 8-K filed on
October 15, 1998, pursuant to the Stock and Asset Purchase
Agreement ("Purchase Agreement") by and between DIMON
Incorporated ("DIMON") and Florimex Worldwide GmbH ("Florimex
Germany"), and U.S.A. Floral Products, Inc. ("USA Floral"),
effective September 30, 1998, USA Floral acquired: (i) the stock
of 23 subsidiaries of Florimex Germany; (ii) certain assets and
liabilities of Florimex Germany; and (iii) the stock of Florimex
USA, Inc. ("Florimex USA") and Florimex Canada, Inc. ("Florimex
Canada"), each of which were previously wholly-owned subsidiaries
of DIMON. Florimex Germany, Florimex USA and Florimex Canada are
collectively referred to as "Florimex." Florimex is the largest
international importer and distributor of fresh-cut flowers in
the world with operations in over 15 countries.
Pursuant to the terms of the Purchase Agreement: (i) USA Floral
acquired from DIMON all of the shares of the issued and
outstanding capital stock of Florimex USA and Florimex Canada;
(ii) U.S.A. Floral Products Germany GmbH & Co. KG, a German
limited partnership, acquired from Florimex Germany all of the
shares of the issued and outstanding capital stock of three
German operating subsidiaries of Florimex Germany; (iii) U.S.A.
Floral Products Holding GmbH, the limited partner of the German
limited partnership described above and a wholly-owned subsidiary
of USA Floral, acquired from Florimex Germany all of the shares
of the issued and outstanding capital stock of 20 other
subsidiaries directly or indirectly owned, of record and
beneficially by Florimex Germany; and (iv) U.S.A. Floral Products
Holding GmbH acquired from Florimex Germany certain assets and
liabilities. In consideration for the exchange of their shares of
issued and outstanding capital stock and/or assets and
liabilities, DIMON and Florimex Germany received in the aggregate
approximately $66.1 million in cash and USA Floral or its
subsidiaries extinguished approximately $23.6 million of the net
debt of the acquired businesses. The total consideration was
determined on the basis of arms' length negotiations between
representatives of USA Floral, DIMON and Florimex Germany.
The financial statements of Florimex and pro forma information
relating to the acquisition, required to be filed in connection
with the acquisition pursuant to Items 7(a) and (b) of Form 8-K,
are included herewith.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Businesses Acquired.
(i) Financial Statements of Florimex GmbH, Florimex USA and
Florimex Canada as of June 30, 1998 and 1997 and for each
of the three years in the period ended June 30, 1998.
(b) Pro Forma Financial Information.
(i) Unaudited Pro Forma Combined Balance Sheet as of June 30,
1998.
(ii) Unaudited Pro Forma Statements of Operations for the year
ended December 31, 1997 and for the six months ended June
30, 1998.
<PAGE>
(c) Exhibits. The following exhibits are filed as part of this
Current Report on Form 8-K:
Description Exhibit No.
------------------------------------------------ --------------
Stock and Asset Purchase Agreement by and 2.1 *
between DIMON Incorporated and Florimex
Worldwide GmbH, and U.S.A. Floral Products,
Inc.
Credit Agreement among U.S.A. Floral Products, 4.1 *
Inc., U.S.A. Floral Products Germany GmbH & Co.
KG, Florimex Worldwide B.V., Various Lending
Institutions, Bayerische Hypo-Und Vereinsbank AG,
as Syndication Agent, BankBoston, N.A., as
Documentation Agent, and Bankers Trust Company,
as Arranger and Administrative Agent, dated as of
October 16, 1997 and Amended and Restated as of
October 2, 1998.
Consent of PricewaterhouseCoopers LLP 23.1 **
Consent of Kidsons Imprey 23.2 **
Consent of Sonderehoff & Einsel 23.3 **
Consent of AUDICONT 23.4 **
* Previously filed as part of the Company's Current Report on
Form 8-K, filed on October 15, 1998 (File No. 000-23121), and
omitted pursuant to General Instruction B.3 of Form 8-K.
** Filed herewith.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: December 14, 1998 U.S.A. Floral Products, Inc.
By: /s/ W. Michael Kipphut
------------------------------
W. Michael Kipphut
Chief Financial Officer
<PAGE>
U.S.A. FLORAL PRODUCTS, INC.
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
U.S.A. FLORAL PRODUCTS, INC. UNAUDITED PRO FORMA COMBINED FINANCIAL
STATEMENTS
Introduction to Unaudited Pro Forma Combined Financial Statements.................................. F-2
Unaudited Pro Forma Combined Balance Sheet......................................................... F-3
Unaudited Pro Forma Combined Statement of Operations............................................... F-4
Notes to Unaudited Pro Forma Combined Financial Statements......................................... F-6
FLORIMEX GMBH, FLORIMEX USA, INC. AND FLORIMEX CANADA, INC. COMBINED
FINANCIAL STATEMENTS
Report of Independent Accountants.................................................................. F-9
Report of Independent Accountants.................................................................. F-10
Report of Independent Accountants.................................................................. F-11
Report of Independent Accountants.................................................................. F-12
Combined Balance Sheets............................................................................ F-13
Combined Statements of Income...................................................................... F-14
Combined Statements of Stockholders' Equity........................................................ F-15
Combined Statements of Cash Flows.................................................................. F-16
Notes to Combined Financial Statements............................................................. F-17
</TABLE>
<PAGE>
U.S.A. FLORAL PRODUCTS, INC.
INTRODUCTION TO UNAUDITED PRO FORMA
COMBINED FINANCIAL STATEMENTS
The following unaudited pro forma combined financial statements give effect to
certain acquisitions completed through September 30, 1998 by U.S.A. Floral
Products, Inc. ("USA Floral"). Specifically, they give effect to the acquisition
of (i) Continental Farms Limited and Atlantic Bouquet Company Limited
("Continental"), XL Group, Inc. ("XL Group"), Koehler & Dramm, Inc. ("Koehler &
Dramm"), each of which was consummated in January 1998, and Florimex GmbH,
Florimex USA, Inc. and Florimex Canada, Inc. ("Florimex"), which was consummated
on September 30, 1998, all of which are considered significant under the rules
and regulations of the Securities and Exchange Commission and are collectively
referred to as the "Significant Acquisitions" and (ii) Everflora, Inc. and
Everflora Miami, Inc. ("Everflora"), H&H Flowers, Inc. d/b/a La Fleurette ("H&H
Flowers"), UltraFlora Corporation ("UltraFlora"), Elite Farms ("Elite"), David
L. Jones Wholesale, Ltd. ("DL Jones"), Edfrancar, Inc. d/b/a Florafresh
International ("Florafresh"), Master Flowers, Inc. d/b/a Sabana Farms
("Sabana"), Maxima Farms, Inc. ("Maxima"), Selecta Farms, Inc. and Saint Ann
Trading Corporation ("Selecta"), Pacific Floral Wholesale, Inc. and Rose City
Floral, Inc. ("Rose City") and AFB Marketing, Inc. d/b/a Allan Stanley
Greenhouses ("Allan Stanley"), collectively the "Other Acquisitions", each of
which is considered insignificant and all of which were consummated prior to
June 30, 1998.
The unaudited pro forma combined balance sheet gives effect to the acquisition
of Florimex as if it had occurred as of the Company's most recent balance sheet
date, June 30, 1998.
The unaudited pro forma combined statements of operations give effect to (i)
USA Floral's initial public offering ("IPO") of Common Stock on October 16, 1997
as if such offering had occurred on January 1, 1997; (ii) the acquisition,
effective October 16, 1997, of the Founding Companies which were business
combinations accounted for under the purchase method of accounting as if such
acquisitions had been consummated on January 1, 1997; (iii) the acquisitions of
the Significant Acquisitions, which were business combinations accounted for
under the purchase method of accounting, as if such acquisitions had been
consummated on January 1, 1997; and (iv) the acquisitions of the Other
Acquisitions which were business combinations accounted for under the purchase
method of accounting, as if such acquisitions had been consummated on January 1,
1997. Certain reclassifications of amounts included in the statements of
operations of acquired companies have been made to conform with USA Floral's
financial statement presentation.
The pro forma adjustments are based on preliminary estimates, available
information and certain assumptions that management deems appropriate, and may
be revised as additional information becomes available. The pro forma financial
data presented herein does not purport to represent what USA Floral's financial
position or results of operations would actually have been if such transactions
in fact had occurred on those dates and are not necessarily representative of
USA Floral's financial position or results of operations for any future period.
The unaudited pro forma combined financial statements should be read in
conjunction with the other financial statements and notes thereto included
elsewhere in this Form 8-K/A and USA Floral's consolidated financial statements
and notes thereto included in its Annual Report on Form 10-K for the year ended
December 31, 1997 and its Quarterly Reports on Form 10-Q for the periods ended
March 31, 1998 and June 30, 1998.
These pro forma combined financial statements do not include the effects of
USA Floral's acquisition of nine companies in July 1998 (the "July 1998
Class"), each of which is insignificant. Aggregate consideration paid for the
acquisition of the July 1998 Class was approximately $20 million (excluding
potential additional consideration under earn-out arrangements of $7 million),
comprising cash of $12 million and approximately 500,000 shares of Common Stock
with a value of $8 million. Revenues for the nine companies for their latest
respective fiscal year end aggregated approximately $101 million. Goodwill
arising from these acquisitions, which will be accounted under for the purchase
method of accounting, is expected to approximate $17 million, excluding earn-out
arrangements.
Similarly, the pro forma combined statement of operations for the year ended
December 31, 1997 does not include the effects of Florimex' acquisition of
Sierafor, a bouquet manufacturer and distributor to mass marketers in Europe, on
January 1, 1998. Sierafor's revenues for the year ended December 31, 1997 were
approximately $50 million.
F-2
<PAGE>
U.S.A. FLORAL PRODUCTS, INC.
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
June 30, 1998
(in thousands)
<TABLE>
<CAPTION>
Pro Forma
USA Adjustments Pro Forma
Floral Florimex (See Note 3) Combined
-----------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Cash and cash equivalents $ 21,382 $ 3,262 $ (1,904) $ 22,740
Accounts receivable, net 47,840 32,426 -- 80,266
Inventory 12,066 3,921 (138) 15,849
Due from related parties -- 278 -- 278
Prepaid expenses and other 4,443 5,770 (100) 10,113
-----------------------------------------------------------
Total current assets 85,731 45,657 (2,142) 129,246
Property and equipment, net 18,478 37,335 (1,232) 54,581
Due from related parties -- -- -- --
Deferred income taxes 698 -- -- 698
Goodwill, net 181,741 15,264 40,837 237,842
Restricted cash 3,584 -- -- 3,584
Deferred financing costs, net 1,696 -- 1,904 3,600
Other assets 3,994 1,048 -- 5,042
-----------------------------------------------------------
Total assets $295,922 $99,304 $ 39,367 $434,593
===========================================================
LIABILITIES AND STOCKHOLDERS'
EQUITY
Short-term debt $ 73,284 $13,147 $ 30,393 $116,824
Accounts payable and accrued expenses 37,005 32,812 2,848 72,665
Due to stockholders 7,371 -- -- 7,371
Income taxes payable 3,157 1,894 -- 5,051
Due to related parties -- -- -- --
-----------------------------------------------------------
Total current liabilities 120,817 47,853 33,241 201,911
Long-term debt 403 14,321 35,679 50,403
Deferred income taxes 23 5,059 -- 5,082
Minority interest in subsidiaries -- 458 -- 458
Other 1,368 -- 2,060 3,428
-----------------------------------------------------------
Total liabilities 122,611 67,691 70,980 261,282
-----------------------------------------------------------
Stockholders' equity:
Common stock 14 37,154 (37,154) 14
Additional paid-in capital 164,173 -- -- 164,173
Accumulated other comprehensive income (207) (1,801) 1,801 (207)
Retained earnings 9,331 (3,740) 3,740 9,331
-----------------------------------------------------------
Total stockholders' equity 173,311 31,613 (31,613) 173,311
-----------------------------------------------------------
Total liabilities and stockholders'
equity $295,922 $99,304 $ 39,367 $434,593
===========================================================
</TABLE>
See notes to unaudited pro forma combined financial statements.
F-3
<PAGE>
U.S.A. FLORAL PRODUCTS, INC.
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
(in thousands, except share data)
<TABLE>
<CAPTION>
USA Founding Continental XL Koehler
Floral Companies Farms Group & Dramm Florimex
-------- --------- ------- ------- ------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net sales................................ $ 37,380 $146,744 $62,494 $32,329 $22,685 $ 367,774
Cost of sales............................ 26,685 104,991 44,774 24,443 15,882 292,052
-------- ------- ------ ------ ------ ----------
Gross profit........................... 10,695 41,753 17,720 7,886 6,803 75,722
Selling, general and administrative...... 9,791 36,320 12,820 7,284 5,425 64,742
Goodwill amortization.................... 275 -- -- -- -- 961
-------- ------- ------ ------ ------ ----------
Income from operations................. 629 5,433 4,900 602 1,378 10,019
Other (income) expense:
Interest expense...................... 8 435 57 -- 4 2,103
Interest income........................ (248) (340) (458) (40) -- (242)
Other, net............................. (37) (366) (58) (4) (63) --
-------- ------- ------ ------ ------ ----------
Income before income taxes............... 906 5,704 5,359 646 1,437 8,158
Provision for income taxes............... 490 960 -- -- 551 3,303
-------- ------- ------ ------ ------ ----------
Income before minority interest.......... 416 4,744 5,359 646 886 4,855
Income applicable to minority interest... -- -- -- -- -- (121)
-------- ------- ------- ------ ------- ----------
Net income............................... $ 416 $ 4,744 $ 5,359 $ 646 $ 886 $ 4,734
======== ======= ======= ====== ======= ==========
Net income per share, basic and diluted.. $ 0.09
========
Weighted average shares outstanding:
Basic.................................. 4,734,198
=========
Diluted................................ 4,824,097
=========
Pro forma net income per share, basic....
Pro forma net income per share, diluted..
Shares used in computing pro forma net
income per share (see Note 5):
Basic..................................
Diluted................................
<CAPTION>
Pro Forma
Other Adjustments Pro Forma
Acquisitions (See Note 4) Combined
------------ ----------- ---------
<S> <C> <C> <C>
Net sales................................ $ 159,471 $ -- $ 828,877
Cost of sales............................ 122,236 (5,433) 625,630
------------ ----------- ---------
Gross profit........................... 37,235 5,433 203,247
Selling, general and administrative...... 32,027 (4,528) 163,881
Goodwill amortization.................... -- 4,765 6,001
------------ ----------- ---------
Income from operations................. 5,208 5,196 33,365
Other (income) expense:
Interest expense...................... 1,062 11,033 14,702
Interest income........................ (325) 338 (1,315)
Other, net............................. (125) 91 (562)
------------ ----------- ---------
Income before income taxes............... 4,596 (6,266) 20,540
Provision for income taxes............... 1,185 2,387 8,876
------------ ----------- ---------
Income before minority interest.......... 3,411 (8,653) 11,664
Income applicable to minority interest... -- -- (121)
------------ ----------- ---------
Net income............................... $ 3,411 $ (8,653) $ 11,543
============ =========== =========
Net income per share, basic and diluted..
Weighted average shares outstanding:
Basic..................................
Diluted................................
Pro forma net income per share, basic.... $ 0.80
Pro forma net income per share, diluted.. $ 0.79
Shares used in computing pro forma net
income per share (see Note 5):
Basic.................................. 14,426,948
Diluted................................ 14,525,619
</TABLE>
See notes to unaudited pro forma combined financial statements.
F-4
<PAGE>
U.S.A. FLORAL PRODUCTS, INC.
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30,1998
(in thousands, except share data)
<TABLE>
<CAPTION>
Significant Acquisitions
USA ----------------------------------------------------------
Floral Continental XL K&D Florimex
-------------- --------------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Net sales........................................ $ 234,294 $ 3,709 $ 2,264 $ 663 $ 220,982
Cost of sales.................................... 170,721 2,696 1,676 450 181,341
-------------- --------------- ------------- ----------- -------------
Gross profit................................ 63,573 1,013 588 213 39,641
Selling, general and administrative.............. 44,557 1,174 505 376 34,758
Goodwill amortization............................ 1,884 - - - 544
-------------- --------------- ------------- ----------- -------------
Income from operations...................... 17,132 (161) 83 (163) 4,339
Other (income) expense;
Interest expense............................... 2,094 3 - - 1,092
Interest income................................ (743) (36) (2) - (579)
Other, net..................................... (378) (16) (1) (5) -
-------------- --------------- ------------- ----------- -------------
Income before income taxes....................... 16,159 (112) 86 (158) 3,826
Provision for income taxes....................... 7,244 - - - 2,205
-------------- --------------- ------------- ----------- -------------
Income before minority interest.................. 8,915 (112) 86 (158) 1,621
Income applicable to minority interest........... - - - - (52)
-------------- --------------- ------------- ----------- -------------
Net income ...................................... $ 8,915 $ (112) $ 86 $ (158) $ 1,569
============== =============== ============= =========== =============
Net income per share, basic...................... $ 0.67
Net income per share, diluted.................... $ 0.64
Weighted average shares outstanding:
Basic.......................................... 13,355,868
Diluted........................................ 13,854,899
Pro forma net income per share, basic............
Pro forma net income per share, diluted..........
Shares used in computing pro forma net income
per share (see Note 5):
Basic..........................................
Diluted........................................
<CAPTION> Pro Forma
Other Adjustments Pro Forma
Acquisitions (See Note 4) Combined
-------------- -------------- -------------
<S> <C> <C> <C>
Net sales........................................ $36,112 $ - $498,024
Cost of sales.................................... 26,346 (687) 382,543
-------------- -------------- -------------
Gross profit................................ 9,766 687 115,481
Selling, general and administrative.............. 8,499 (1,196) 88,673 (1)
Goodwill amortization............................ - 573 3,001
-------------- -------------- -------------
Income from operations...................... 1,267 1,310 23,807
Other (income) expense;
Interest expense............................... 288 3,829 7,306
Interest income................................ (81) 60 (1,381)
Other, net..................................... (403) 45 (758)
-------------- -------------- -------------
Income before income taxes....................... 1,463 (2,624) 18,640
Provision for income taxes....................... 427 (1,005) 8,871
-------------- -------------- -------------
Income before minority interest.................. 1,036 (1,619) 9,769
Income applicable to minority interest........... -- -- (52)
-------------- -------------- -------------
Net income ...................................... $ 1,036 $(1,619) $ 9,717 (1)
============== ============== =============
Net income per share, basic......................
Net income per share, diluted....................
Weighted average shares outstanding:
Basic..........................................
Diluted........................................
Pro forma net income per share, basic............ $ 0.67
Pro forma net income per share, diluted.......... $ 0.65
Shares used in computing pro forma net income
per share (see Note 5):
Basic.......................................... 14,426,948
Diluted........................................ 14,858,007
</TABLE>
- ----------------
(1) Includes a $2,972 (pre-tax) non-recurring charge recorded by Florimex
related to the closure of several offices in Europe and the termination of
the employees in those offices. Without such charge, proforma net income
would have been $11,351, or $0.79 per share, basic and $0.76 per share,
diluted.
See notes to unaudited pro forma combined financial statement
F-5
<PAGE>
U.S.A. FLORAL PRODUCTS, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
(in thousands, except share data)
NOTE 1--ACQUISITION OF FOUNDING COMPANIES
USA Floral was founded in April 1997 to create a national consolidator and
operator of floral products distribution businesses. Effective October 16, 1997
USA Floral acquired all of the outstanding capital stock of the Founding
Companies concurrently with the closing of its IPO. These business combinations
were accounted for under the purchase method of accounting.
The following table sets forth the consideration paid in cash and in shares
of Common Stock to the common stockholders of each of the Founding Companies,
the allocation of the consideration to net assets acquired and resulting
goodwill. For purposes of computing the purchase price for financial accounting
purposes, the value of Common Stock is based upon the IPO price of $13.00 per
share.
<TABLE>
<CAPTION>
Shares of Net
Common Value of Total Assets
Cash(1) Stock Shares Consideration Acquired Goodwill
------- ----- ------ ------------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Houff..................................... $11,006 -- $ -- $11,006 $ 3,454 $ 7,552
CFX....................................... 6,521 250,000 3,250 9,771 1,229 8,542
Bay State................................. 6,045 495,550 6,442 12,487 4,156 8,331
Flower Trading............................ 5,920 160,000 2,080 8,000 1,273 6,727
United Wholesale.......................... 4,788 268,500 3,491 8,279 2,298 5,981
American Florist.......................... 4,800 141,749 2,400 7,200 249 6,951
Monterey Bay.............................. 3,000 177,185 3,000 6,000 705 5,295
Alpine Gem................................ 1,600 160,000 2,080 3,680 215 3,465
----- ------- ----- ----- --- -----
Total..................................... $43,680 1,652,984 $22,743 $66,423 $13,579 $52,844
======= ========= ======= ======= ======= =======
</TABLE>
- ---------------
(1) Does not include S Corporation distributions paid to owners of CFX, Inc.
NOTE 2--ACQUISITIONS
In January 1998, USA Floral acquired the outstanding capital stock of
Continental, XL Group, Koehler & Dramm, Everflora, H&H Flowers and UltraFlora.
In April 1998, USA Floral acquired the outstanding capital stock of Elite, DL
Jones, Florafresh, Sabana, Maxima, Selecta, Rose City and Allan Stanley. In
September 1998, USA Floral acquired the outstanding capital stock of Florimex.
These business combinations were accounted for under the purchase method of
accounting.
The following table sets forth the consideration paid in cash and in shares
of Common Stock to the stockholders of each of these businesses, the
allocation of the consideration to net assets acquired and resulting goodwill.
The purchase price includes contingent consideration of approximately (a) $5,892
in shares of Common Stock related to an earn-out arrangement for UltraFlora,
which is based on 1997 earnings before interest and taxes and (b) $1,465 in
shares of Common Stock related to an earn-out arrangement for Sabana, which is
based on adjusted earnings before interest and taxes, as defined, for the twelve
months ended May 31, 1998. The total purchase consideration does not reflect
contingent consideration related to earn-out arrangements included in the
definitive agreements for XL Group, Maxima, DL Jones, Rose City and Allan
Stanley. The earn-out arrangements provide for the Company to pay additional
consideration, based on adjusted earnings before interest and taxes, as defined,
for the twelve months ending February 28, 1999 for DL Jones, for the twelve
months ending March 31, 1999 for Allan Stanley and for the twelve months ending
December 31, 1998 for XL Group, Rose City and Maxima.
<TABLE>
<CAPTION>
Shares of Net
Common Value of Total Assets
Significant Acquisitions Cash(1) Stock Shares Consideration Acquired Goodwill
- ------------------------ ------- ----- ------ ------------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Continental Farms......................... $27,500 1,642,672 $27,500 $ 55,000 $ 5,359 $ 49,641
XL Group.................................. 11,250 660,938 11,000 22,250 5,525 16,725
Koehler & Dramm........................... 5,000 298,596 5,000 10,000 3,544 6,456
Florimex.................................. 66,072 -- -- 66,072 9,971 56,101
------- --------- ------- -------- ------- --------
Total................................ 109,822 2,602,206 $43,500 $153,322 $24,399 $128,923
======= ========= ======= ======== ======= ========
<PAGE>
<CAPTION>
Shares of Net
Common Value of Total Assets
Other Acquisitions Cash Stock Shares Consideration Acquired Goodwill
- ------------------ ------- --------- -------- ------------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Everflora................................. $ 4,000 246,654 $ 4,000 $ 8,000 $ 2,889 $ 5,111
H&H Flowers............................... 1,600 -- -- 1,600 (710) 2,310
UltraFlora................................ 2,750 522,768 8,642 11,392 1,559 9,833
Elite..................................... 3,700 184,907 3,700 7,400 796 6,604
DL Jones.................................. 2,183 179,020 3,976 6,159 1,275 4,884
Florafresh................................ 3,945 172,928 3,945 7,890 (1,025) 8,915
Sabana.................................... 659 164,784 3,453 4,112 776 3,336
Maxima.................................... 5,300 233,418 5,300 10,600 2,668 7,932
Selecta................................... 2,500 112,007 2,500 5,000 238 4,762
Rose City................................. 133 10,634 240 373 (176) 549
Allan Stanley............................. 1,925 84,638 1,925 3,850 (148) 3,998
------- ---------- ------- -------- ------- --------
Total................................ $28,695 1,911,758 $37,681 $66,376 $ 8,142 $58,234
======= ========= ======= ======== ======= ========
</TABLE>
F-6
<PAGE>
U.S.A. FLORAL PRODUCTS, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS--(Continued)
(in thousands, except share data)
NOTE 3--UNAUDITED PRO FORMA COMBINED BALANCE SHEET ADJUSTMENTS
The following table summarizes unaudited pro forma combined balance sheet
adjustments for the acquisition of Florimex:
<TABLE>
<CAPTION>
TOTAL
PRO FORMA
ADJUSTMENTS
-----------
<S> <C>
ASSETS
Cash and cash equivalents..................................... $ (1,904)
Accounts receivable, net...................................... --
Inventory..................................................... (138)
Due from related parties...................................... --
Prepaid expenses and other.................................... (100)
--------
Total current assets.................................... (2,142)
Property and equipment, net................................... (1,232)
Due from related parties...................................... --
Deferred income taxes......................................... --
Goodwill, net................................................. 40,837
Restricted cash............................................... --
Deferred financing costs, net................................. 1,904
Other assets.................................................. --
--------
Total assets............................................ $ 39,367
========
LIABILITIES AND STOCKHOLDERS' EQUITY
Short-term debt............................................... $ 30,393
Accounts payable and accrued expenses......................... 2,848
Due to stockholders........................................... --
Income taxes payable.......................................... --
Due to related parties........................................ --
--------
Total current liabilities............................... 33,241
Long-term debt................................................ 35,679
Deferred income taxes......................................... --
Minority interest in subsidiaries............................. --
Other......................................................... 2,060
--------
Total liabilities....................................... 70,980
--------
Stockholders' equity:
Common stock............................................... (37,154)
Additional paid-in capital................................. --
Accumulated other comprehensive income..................... 1,801
Retained earnings.......................................... 3,740
--------
Total stockholders' equity.............................. $(31,613)
--------
Total liabilities and stockholders' equity.............. $ 39,367
========
</TABLE>
- ----------
The above adjustment records (a) the purchase of Florimex by USA Floral, (b) the
incremental debt and the related deferred financing costs necessary to fund the
acquisition and (c) various purchase accounting adjustments, including the
establishment of restructuring reserves in accordance with EITF 95-3 and the
adjustment of certain assets and liabilities to fair market value.
NOTE 4--UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS ADJUSTMENTS--
FOUNDING COMPANIES
The following tables summarize unaudited pro forma combined statement of
operations adjustments. The table for the year ended December 31, 1997 includes
pro forma adjustments related to the acquisitions of the Founding Companies, the
Significant Acquisitions and the Other Acquisitions. The table for the six
months ended June 30, 1998 includes pro forma adjustments related to the
Significant Acquisitions and the Other Acquisitions.
<TABLE>
<CAPTION>
Year Ended December 31, 1997
---------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f)
Sales $ -- $ -- $ -- $ -- $ -- $ --
Cost of sales -- -- -- (5,433) -- --
SG&A (2,391) -- -- (1,265) -- --
Goodwill amortization -- 4,765 -- -- -- --
---------------------------------------------------------------------------------------
Income from operations 2,391 (4,765) -- 6,698 -- --
Other (income) expense:
Interest expense -- -- (325) -- (50) 11,653
Interest income -- -- -- -- 50 288
Other income -- -- -- -- -- --
---------------------------------------------------------------------------------------
Income before income taxes 2,391 (4,765) 325 6,698 -- (11,941)
Provision for income taxes -- -- -- -- -- --
---------------------------------------------------------------------------------------
Net income $ 2,391 $ (4,765) $ 325 $ 6,698 $ -- $ (11,941)
=======================================================================================
<CAPTION>
Year Ended December 31, 1997
-------------------------------------------------------------------------
(g) (h) (i) (j) Total
<S> <C> <C> <C> <C> <C>
Sales $ -- $ -- $ -- $ -- $ --
Cost of sales -- -- -- -- (5,433)
SG&A (662) (933) 723 -- (4,528)
Goodwill amortization -- -- -- -- 4,765
-------------------------------------------------------------------------
Income from operations 662 933 (723) -- 5,196
Other (income) expense:
Interest expense -- (245) -- -- 11,033
Interest income -- -- -- -- 338
Other income -- 91 -- -- 91
-------------------------------------------------------------------------
Income before income taxes 662 1,087 (723) -- (6,266)
Provision for income taxes -- -- -- 2,387 2,387
-------------------------------------------------------------------------
Net income $ 662 $ 1,087 $ (723) $ (2,387) $ (8,653)
=========================================================================
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended June 30, 1998
---------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f)
<S> <C> <C> <C> <C> <C>
Sales $ -- $ -- $ -- $ -- $ -- $ --
Cost of sales -- -- -- (687) -- --
SG&A 146 -- -- (1,051) -- --
Goodwill amortization -- 573 -- -- -- --
---------------------------------------------------------------------------------------
Income from operations (146) (573) -- 1,738 -- --
Other (income) expense:
Interest expense -- -- -- -- (2) 3,874
Interest income -- -- -- -- 2 58
Other income -- -- -- -- -- --
---------------------------------------------------------------------------------------
Income before income taxes (146) (573) -- 1,738 -- (3,932)
Provision for income taxes -- -- -- -- -- --
---------------------------------------------------------------------------------------
Net income $ (146) $ (573) $ -- $ 1,738 $ -- $ (3,932)
=======================================================================================
<CAPTION>
Six Months Ended June 30, 1998
-------------------------------------------------------------------------
(g) (h) (i) (j) Total
<S> <C> <C> <C> <C> <C>
Sales $ -- $ -- $ -- $ -- $ --
Cost of sales -- -- -- -- (687)
SG&A (258) (33) -- -- (1,196)
Goodwill amortization -- -- -- -- 573
-------------------------------------------------------------------------
Income from operations 258 33 -- -- 1,310
Other (Income) expense:
Interest expense -- (43) -- -- 3,829
Interest income -- -- -- -- 60
Other income -- 45 -- -- 45
-------------------------------------------------------------------------
Income before income taxes 258 31 -- -- (2,624)
Provision for income taxes -- -- -- (1,005) (1,005)
-------------------------------------------------------------------------
Net income $ 258 $ 31 $ -- $ 1,005 $ (1,619)
=========================================================================
</TABLE>
(a) Reflects the reduction in salaries, bonuses and benefits to the former
owners of the acquired businesses to which they have agreed to
prospectively, net of an increase in expenses associated with USA Floral
Management and administration required by the acquisitions.
(b) Reflects the incremental amortization of goodwill to be recorded as a
result of these acquisitions over a 40-year estimated life as if these
acquisitions had occurred on January 1, 1997.
(c) Reflects the elimination of interest expense on debt repaid with proceeds
from the initial public offering.
(d) Reflects the reduction in cost of sales and selling general and
administrative expenses attributable to a reduction in the price of
products and services provided under contracts with affiliated entities, to
which USA Floral and the affiliated entity have agreed to prospectively.
(e) Reflects the elimination of interest income and interest expense on related
party payables and receivables between the Founding Companies and the
Other acquisitions.
(f) Reflects (i) the elimination of interest income earned on Offering proceeds
estimated to be utilized in the purchase of the acquisitions; and
(ii) an increase in interest expense and related fees associated with
necessary debt incurred to fund the acquisitions, assuming the $200
million revolving credit facility and the $50 million term loan were
established on January 1, 1997.
(g) Reflects the elimination of legal costs incurred by the acquired companies
in connection with the acquisitions.
(h) Reflects (i) adjustment for the elimination of lease expense associated
with the purchase of real estate and real estate taxes associated with this
real estate; (ii) increase in rental expense as a result of distribution of
real estate prior to the acquisitions of the Founding Companies and a
related decrease in depreciation expense and real estate taxes; (iii) the
renegotiation of lease terms with related parties to arms length; and (iv)
adjustment for the elimination of interest expense on mortgages not
acquired.
(i) Reflects (i) an increase in expenses of $310 associated with USA Floral
management and the costs of being a public entity of $290 for the year
ended December 31, 1997, and (ii) compensation expenses of $123 associated
with the issuance of 125,000 stock options with an exercise price below the
initial public offering price which vest over four years, for the year
ended December 31, 1997.
(j) Reflects (i) the incremental provision for federal and state income taxes
assuming all entities, some of which were S-Corporations, were subject to
such taxes and (ii) tax effects of pro forma adjustments (a) through (i)
above, assuming the non-deductibility of goodwill arising from the purchase
of non-partnership interests.
F-7
<PAGE>
U.S.A. FLORAL PRODUCTS, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS--(Continued)
(in thousands, except share data)
NOTE 5--SHARES USED IN COMPUTING PRO FORMA NET INCOME PER SHARE
The shares used in computing pro forma net income per share are calculated
as follows:
<TABLE>
<CAPTION>
Six Months Ended
June 30,
Actual Year Ended ----------------
Shares December 31,1997 1998
-------- ---------------- ----------------
<S> <C> <C> <C>
Issued on formation of USA Floral .............. 2,400,000 2,400,000 2,400,000
Issued to owners of Founding Companies ......... 1,652,984 1,652,984 1,652,984
Issued in IPO .................................. 5,750,000 5,750,000 5,750,000
Issued on exercise of option ................... 110,000 110,000 110,000
Issued to owners of Significant Acquisitions ... 2,602,206 2,602,206 2,602,206
Issued to owners of Other Acquisitions ......... 1,911,758 1,911,758 1,911,758
---------- ----------
Weighted average shares outstanding-basic ...... 14,426,948 14,426,948
Dilution attributable to unexercised options ... 98,671 431,059
---------- ----------
Weighted average shares outstanding-diluted .... 14,525,619 14,858,007
========== ==========
</TABLE>
The above shares do not include shares which may be issued under the
earn-out arrangements for XL Group, Maxima, DL Jones, Rose City and Allan
Stanley as discussed in Note 2 of the Notes to the Unaudited Proforma Combined
Financial Statements. In addition, the above shares do not include
approximately 500,000 shares issued in connection with insignificant
acquisitions consummated subsequent to June 30, 1998.
F-8
<PAGE>
Report of Independent Accountants
To the Board of Directors and Shareholders
of Florimex GmbH, Florimex USA, and
Florimex Canada
In our opinion, based upon our audits and the reports of other auditors, the
accompanying combined balance sheets and the related combined statements of
income and stockholders' equity and of cash flows present fairly, in all
material respects, the financial position of the combined companies of Florimex
GmbH, Florimex USA, Inc. and Florimex Canada, Inc. (collectively the "Company")
and their subsidiaries at June 30, 1998 and 1997, and the results of their
operations and their cash flows for each of the three years in the period ended
June 30, 1998, in conformity with generally accepted accounting principles.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements based
on our audits. We did not audit the financial statements of Florimex (Japan)
Limited, Florimex Milano S.r.1., and Florimex (UK) Limited, wholly-owned
subsidiaries of Florimex GmbH, which statements reflect total assets of
$9,293,020 and $10,006,226 at June 30, 1998 and 1997, respectively, and total
revenues of $53,330,042, $53,565,810 and $54,265,266 for the years ended
June 30, 1998,1997, and 1996, respectively. Those statements were audited by
other auditors whose reports thereon have been furnished to us, and our opinion
expressed herein, insofar as it relates to the amounts included for Florimex
(Japan) Limited, Florimex Milano S.r.l., and Florimex (UK) Limited, is based
solely on the report of the other auditors. We conducted our audits of the
combined financial statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits and the reports of other auditors provide a reasonable basis for the
opinion expressed above.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Charlotte, NC
November 18, 1998
F-9
<PAGE>
Report of Independent Accountants
To the Board of Directors and Shareholders
of Florimex (Japan) Ltd.
We have audited the balance sheets of Florimex (Japan) Limited as of June 30,
1998 and 1997, and the related statements of income, shareholders' equity and
cash flows for each of the three years ended June 30, 1998. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing standards
in Japan, which are generally the same as those in the United States of America.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of 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 by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements audited by us present fairly, in all
material respects, the financial position of Florimex (Japan) Limited as of June
30, 1998 and 1997, and the results of its operations and its cash flows for each
of the three years ended June 30, 1998 in conformity with accounting principles
generally accepted in Japan.
Sonderhoff & Einsel
Tokyo, Japan
July 10, 1998
/s/ Masao Ishikawa
Masao Ishikawa
Certified Public Accountant in Japan
F-10
<PAGE>
Report of Independent Accountants
To the Board of Directors and Shareholders
of Florimex Milano Srl
We have audited the balance sheets Florimex Milano Srl as of June 30, 1998 and
1997, and the related statements of income, shareholders' equity and cash flows
for each of the three years ended June 30, 1998. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards
in Italy, which are generally the same as those in the United States of America.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of 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 by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements audited by us present fairly, in all
material respects, the financial position of Florimex Milano Srl as of June 30,
1998 and 1997, and the results of its operations and its cash flows for each of
the three years ended June 30, 1998 in conformity with accounting principles
generally accepted in Italy.
/s/ AUDICONT SAS
AUDICONT SAS
Milan, Italy
July 17, 1998
F-11
<PAGE>
Report of Independent Accountants
To the Board of Directors and
Shareholders of Florimex (UK) Limited
We have audited the balance sheets of Florimex (UK) Limited as of 30 June 1998
and 1997, and the related statements of income and shareholders' equity for each
of the three years ended 30 June 1998. These financial statements are the
responsibility of the company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards
in the United Kingdom, which are generally the same as those in the United
States of America. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
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 by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements audited by us present fairly, in all
material respects, the financial position of Florimex (UK) Limited as of 30 June
1998 and 1997, and the results of its operations for each of the three years
ended 30 June 1998 in conformity with accounting principles generally accepted
in the United Kingdom.
/s/ Kidsons Impey
Kidsons Impey
Chartered Accountants
Devonshire House
36 George Street
Manchester
M1 4HA
United Kingdom
9 December 1998
F-12
<PAGE>
Florimex
Combined Balance Sheets
June 30, 1998 and 1997
- --------------------------------------------------------------------------------
1998 1997
Assets
Current assets
Cash and cash equivalents $ 3,262,313 $ 4,720,125
Receivable from related party 277,612 -
Trade receivables, net of allowances
(1998-$5,075,584; 1997-$3,590,633) 32,425,581 28,784,943
Inventory 3,920,855 3,490,953
Recoverable income taxes 349,660 1,199,015
Prepaid expenses and other assets 5,420,797 4,627,957
------------ ------------
Total current assets 45,656,818 42,822,993
Investments and other assets
Excess or cost over related net
assets of businesses acquired 15,263,875 10,300,681
Other 1,048,602 886,856
------------ ------------
16,312,477 11,187,537
Property, plant and equipment
Land 10,031,847 7,642,880
Buildings 28,957,813 26,210,072
Machinery and equipment 20,439,255 19,205,596
Allowances for depreciation (22,094,303) (19,293,906)
------------ ------------
37,334,612 33,764,642
------------ ------------
$ 99,303,907 $ 87,775,172
============ ============
Liabilities and Stockholders' Equity
Current liabilities
Notes payable to banks $ 10,357,675 $ 5,800,256
Accounts payable
Trade 19,188,100 17,781,948
Officers and employees 2,060,676 2,022,194
Other 3,852,583 2,501,824
Payable to related party - 667,336
Income taxes 1,894,170 1,652,542
Accrued expenses 7,710,905 3,607,644
Long-term debt current 2,788,935 3,431,565
------------ ------------
Total current liabilities 47,853,044 37,465,309
Long-term debt 14,321,160 16,831,615
Deferred taxes and other deferred credits 5,058,822 4,859,460
Minority interest in subsidiaries 457,532 527,223
Commitments and contingencies (Note 14)
Stockholders' equity:
Common equity capital 37,154,587 29,472,707
Retained earnings (deficit) (3,739,971) 50,948
Equity-currency conversions (1,801,267) (1,432,090)
------------ ------------
31,613,349 28,091,565
------------ ------------
$ 99,303,907 $ 87,775,172
============ ============
See notes to combined financial statements.
F-13
<PAGE>
<TABLE>
<CAPTION>
Florimex
Combined Statements of Income
Years Ended June 30, 1998, 1997 and 1996
- ----------------------------------------------------------------------------------------------------------
1998 1997 1996
<S> <C> <C> <C>
Sales and other operating revenues $391,437,670 $387,547,863 $397,902,324
Cost of goods and service sold 352,916,917 343,786,646 353,819,113
------------- ------------- -------------
38,520,753 43,761,217 44,083,211
Selling, general and administrative expenses 32,267,002 32,260,108 34,880,457
------------- ------------- -------------
Operating income 6,253,751 11,501,109 9,202,754
Interest expense 1,947,399 2,495,017 3,770,404
------------- ------------- -------------
Income before income taxes and minority interest 4,306,352 9,006,092 5,432,350
Income taxes 2,480,880 3,550,409 1,826,400
------------- ------------- -------------
Income before minority interest 1,825,472 5,455,683 3,605,950
Income applicable to minority interest (99,880) (124,481) (292,183)
------------- ------------- -------------
Net income $ 1,725,592 $ 5,331,202 $ 3,313,767
============= ============= =============
</TABLE>
See notes to combined financial statements.
F-14
<PAGE>
<TABLE>
<CAPTION>
Florimex
Combined Statements of Stockholders' Equity
June 30, 1998, 1997 and 1996
- ------------------------------------------------------------------------------------------------------------------
Common Retained Equity Total
Equity Earnings Currency Stockholders'
Capital (Deficit) Conversions Equity
<S> <C> <C> <C> <C>
Balance, June 30, 1995 $ 24,825,005 $ (2,861,153) $ (518,658) $ 21,445,194
------------- --------------- ---------------- ----------------
Net income - 3,313,767 - 3,313,767
Equity currency conversion - - (332,929) (332,929)
Cash dividends - (2,074,958) - (2,074,958)
------------- --------------- ---------------- ----------------
Balance, June 30, 1996 24,825,005 (1,622,344) (851,587) 22,351,074
------------- --------------- ---------------- ----------------
Net income - 5,331,202 - 5,331,202
Equity currency conversion - - (580,503) (580,503)
Capital contribution 4,647,702 - - 4,647,702
Cash dividends - (3,657,910) - (3,657,910)
------------- --------------- ---------------- ----------------
Balance, June 30, 1997 29,472,707 50,948 (1,432,090) 28,091,565
------------- --------------- ---------------- ----------------
Net income - 1,725,592 - 1,725,592
Equity currency conversion - - (369,177) (369,177)
Capital contribution 7,681,880 - - 7,681,880
Cash dividends - (5,516,511) - (5,516,511)
------------- --------------- ---------------- ----------------
Balance, June 30, 1998 $ 37,154,587 $ (3,739,971) $ (1,801,267) $ 31,613,349
============= =============== ================ ================
</TABLE>
See notes to combined financial statements.
F-15
<PAGE>
<TABLE>
<CAPTION>
Florimex
Combined Statements of Cash Flows
Years ended June 30, 1998, 1997 and 1996
- -------------------------------------------------------------------------------------------------------------------------
1998 1997 1996
<S> <C> <C> <C>
Operating activities:
Net income $ 1,725,592 $ 5,331,202 $ 3,313,767
Adjustments to reconcile to net cash provided
by operating activities:
Depreciation and amortization 6,350,193 6,704,888 6,948,267
Deferred items (655,301) (969,639) 785,869
Gain on foreign currency transactions (50,348) (24,224) (26,038)
Gain on disposition of fixed assets (388,849) (645,025) (745,184)
Income applicable to minority interest (99,880) (124,481) (292,183)
Bad debt expense (net recoveries) 1,222,266 (36,199) 980,623
Decrease (increase) in receivables 863,590 3,103,932 (405,242)
Decrease (increase) in inventory (246,194) 811,975 (719,519)
Decrease (increase) in recoverable income taxes 849,355 (355,201) 267,670
Decrease (increase) in prepaid expenses
and other assets (435,327) (989,728) 3,747,469
Increase (decrease) in accounts payable
and accrued expenses 3,542,447 (4,691,440) (216,881)
Increase (decrease) In income taxes 241,628 705,238 (414,433)
---------------- -------------- ------------
Net cash provided by operating activities 12,919,172 8,821,298 13,224,185
---------------- -------------- ------------
Investing activities:
Purchase of property and equipment (4,959,873) (6,063,383) (6,067,080)
Proceeds from sale of property and equipment 1,524,049 2,086,057 2,304,225
Proceeds from (advances for) other investments
and other assets (161,746) 16,520 299,062
Purchase of minority interest in subsidiary (399,695) (581,802) -
Acquisition of subsidiaries, net of cash acquired (14,854,593) - -
---------------- -------------- ------------
Net cash used by investing activities (18,851,858) (4,542,608) (3,463,793)
---------------- -------------- ------------
Financing activities:
Net change in short-term borrowings 4,557,419 (2,481,084) (12,365,769)
Repayment of debt (17,099,613) (22,591,163) (9,133,293)
Proceeds from debt 14,851,699 19,215,179 12,070,767
Cash dividends paid (5,516,511) (3,657,910) (2,074,958)
Proceeds from capital contribution 7,681,880 4,647,702 _
---------------- -------------- ------------
Net cash provided by (used by) investing activities 4,474,874 (4,867,276) (11,503,253)
---------------- -------------- ------------
Increase (decrease) in cash and cash equivalents (1,457,812) (588,586) (1,742,861)
Cash and cash equivalents at beginning of year 4,720,125 5,308,711 7,051,572
---------------- -------------- ------------
Cash and cash equivalents at end of year $ 3,262,313 $ 4,720,125 $ 5,308,711
================ ============== ============
Other Information:
Cash paid during the year:
Interest $ 1,759,785 $ 2,469,545 $ 3,357,887
Income taxes 1,501,287 3,762,288 1,912,427
</TABLE>
See notes to combined financial statements.
F-16
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
1. Business
The Company is engaged in the purchase, distribution, and sale of fresh
cut flowers and related perishable floral products, and maintains
operations in eighteen countries. Principal markets served include
Europe and North America. See Note 12 for geographic area data.
2. Significant Accounting Policies
The Functional Currency
The financial statements of foreign entities included in the combined
financial statements have been translated to the U.S. dollar, the
reporting currency, in accordance with Statement of Financial
Accounting Standards No. 52, "Foreign Currency Translation." The
functional currency varies but generally reflects the currency in the
country in which the business operates. Under that statement, all asset
and liability accounts are translated at the current exchange rate, and
income statement items are translated at the average exchange rate for
each quarter; resulting translation adjustments, net of deferred taxes,
are made directly to a separate component of stockholders' equity.
Principles of Consolidation
The financial statements represent a combination of the consolidated
accounts of those wholly owned subsidiaries of DIMON Incorporated
comprising its Florimex Worldwide Division (the "Company"). At June 30,
1998, and for the year then ended, the financial statements include a
combination of the consolidated accounts of Florimex Worldwide GmbH,
Florimex USA, Inc., and Florimex Canada, Inc. and their respective
subsidiaries. At June 30, 1997 and 1996, and for the years then ended,
the financial statements also include the accounts of Florimex
Worldwide BV and Florimex United Kingdom Ltd. The latter two
subsidiaries were wholly owned by DIMON Incorporated until July 1,
1997, when Florimex Worldwide GmbH purchased them.
Use of Estimates
The preparation of combined financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the amounts reported in the
financial statements and the accompanying notes. Actual results could
differ from those estimates.
Revenue Recognition
Revenue is recognized upon shipment of the products.
Cash Equivalents
Cash equivalents are defined as temporary investments of cash with
maturities when purchased of less than 90 days.
Inventory
Inventory consists primarily of fresh cut flowers and is valued at the
lower of average cost or market.
F-17
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
Fair Value of Financial Instruments
The carrying value of cash and cash equivalents, accounts receivable/payable,
accrued expenses and short-term debt approximates fair value because of the
short-term nature of these instruments. The estimated fair value of non-current
debt approximates its carrying value due to its stated interest rate
approximating market rates for debt with similar terms and average maturities.
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of
credit risk consist principally of trade accounts receivable. Receivables are
not collateralized and, accordingly, the Company performs ongoing credit
evaluations of its customers to reduce the risk of loss.
Excess of Cost Over Related Net Assets of Businesses Acquired
Excess of cost over related net assets of businesses acquired is being amortized
on the straight-line basis over a maximum of 40 years. The accumulated
amortization at June 30, 1998 and 1997 is $6,206,733 and $5,177,598,
respectively.
The carrying value of intangible assets is periodically reviewed by the Company
based on expected future undiscounted operating cash flows of the related
business unit. Based upon its most recent analysis, the Company believes that no
material impairment of intangible assets exists at June 30, 1998.
Property, Plant and Equipment
Property, plant and equipment is accounted for on the basis of cost. Provisions
for depreciation are computed on a straight-line basis at annual rates
calculated to amortize the cost of depreciable properties over their estimated
useful lives that range from 3 to 30 years. The combined financial statements
do not include fully depreciated assets.
Income Taxes
The Company provides deferred income taxes on temporary differences including
those arising from tax loss carryforwards, employee benefit accruals, and
depreciation.
In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive Income,"
which establishes standards for reporting and display of comprehensive income
and its components in a full set of general-purpose financial statements. The
Company does not expect this statement to have a material impact on its
financial condition or results of operations upon adoption.
In June 1997, the FASB issued SFAS No. 131, "Disclosure About Segments of an
Enterprise and Related Information," which requires that public business
enterprises report certain information about operating segments in complete sets
of financial statements of the enterprise and in condensed financial statements
of interim periods issued to shareholders. It also requires that public business
enterprises report certain information about their products and services, the
geographic areas in which they operate and their major customers. The Company
does not expect this statement to have a material impact on the financial
condition or results of operations upon adoption.
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," which provides a comprehensive and
consistent standard for the recognition and measurement of derivatives and
hedging activities. The Company does not expect this statement to have a
material impact on its financial position or results of operations upon
adoption.
F-18
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
3. Subsequent Event
On September 30, 1998, the Company was sold to U.S.A. Floral Products, Inc.
and its subsidiaries in accordance with a Stock and Asset Purchase Agreement
(the "Agreement") dated August 12, 1998. Under the terms of the Agreement,
DIMON Incorporated sold its stock held representing 100% of the ownership of
Florimex USA, Inc. and Florimex Canada Inc. Likewise, Florimex Worldwide
GmbH sold its stock held representing ownership in all of the remaining
operating affiliates of the Company, and transferred substantially all of
its assets and liabilities to U.S.A. Floral Products, Inc. DIMON
Incorporated retained its stock held representing 100% ownership of Florimex
Worldwide GmbH. Immediately subsequent to the sale, a substantial portion of
the existing debt balances were repaid and replaced by borrowing facilities
arranged by U.S.A Floral Products, Inc. and its subsidiaries.
4. Acquisition
On January 1, 1998, the Company acquired all of the outstanding capital
stock of Sierafor BV (Sierafor), a privately owned Dutch corporation.
Sierafor procures fresh cut flowers and assembles them into bouquets that
are sold to supermarket chains throughout Europe.
The transaction was accounted for as a purchase, and accordingly, the
combined financial statements of the Company include the results of
operations of Sierafor from the date of acquisition. The $14,590,580
purchase price was paid in cash. The source of the cash was working capital
of the Company, and a $2,930,832 capital contribution from DIMON
Incorporated. Additional purchase price in the amount of $2,223,320 will be
payable to the former Sierafor owner in 1999, 2000 and 2001 if Sierafor
meets certain earnings criteria defined in the agreement. The maximum total
additional purchase price payable over the 3 year period is $2,223,320.
The purchase price has been allocated based on estimated fair values of
assets acquired and liabilities assumed at the date of the acquisition. This
allocation resulted in excess purchase price over net assets acquired of $6
million, which is being amortized on a straight-line basis over 40 years.
The following unaudited pro forma information presents a summary of the
combined results of operations of the Company and the acquired business as
if the acquisition had occurred on July 1, 1996 .
Year ended June 30,
---------------------------
1998 1997
Sales and other operating revenue $416,188,000 $436,698,000
Net income 1,558,000 4,863,702
------------ ------------
5. Non-recurring Expense
Included in cost of sales and service sold and selling, general and
administrative expenses in 1998 is a non-recurring charge of $2,972,000
related to the 1998 closure of several offices in Europe and the termination
of the employees in those offices.
6. Related Parties
Balances with related parties, at June 30, are as follows:
F-19
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
1998 1997
Accounts receivable:
DIMON Incorporated $ 504,116 $ 56,612
DIMON International Tabak BV 5,453 -
-------------- -----------
509,569 56,612
-------------- -----------
Accounts payable:
DIMON Incorporated 180,436 632,263
DIMON International Tabak BV 51,521 91,685
-------------- -----------
231,957 723,948
-------------- -----------
Net receivable (payable) $ 277,612 $ (667,336)
============== ===========
Activities with DIMON Incorporated, for the years ended June 30, are as
follows:
1998 1997 1996
Interest income $ 34,265 $ 84,658 $ 50,228
Management fee earned 109,786 106,907 -
-------------- -------------- -----------
$ 144,051 $ 191,565 $ 50,228
-------------- -------------- -----------
Interest expense $ 26,033 $ 68,135 $ 192,465
-------------- -------------- -----------
7. Short-Term Borrowing Arrangements
The Company has lines of credit arrangements with several banks under
which the Company may borrow up to a total of $28,628,562 ($22,087,000
at June 30, 1997), net of outstanding long-term borrowings. These lines
bear interest at rates ranging from 1.80% to 10.75% at June 30, 1998.
Unused lines of credit at June 30, 1998, amounted to $18,270,887
($16,286,744 at June 30, 1997). There are no compensating balance
agreements at June 30, 1998 or 1997. As mentioned in Note 3,
immediately subsequent to the sale of the Company, a substantial
portion of the existing debt balances were repaid and replaced by
borrowing facilities arranged by U.S.A. Floral Products, Inc. and its
subsidiaries.
8. Long-Term Debt
<TABLE>
<CAPTION>
1998 1997
----------------------------- ------------------------------
Maturing Maturing Maturing Maturing
within One after One within One after One
Year Year Year Year
<S> <C> <C> <C> <C>
Debt secured by property $ 1,216,918 $ 5,504,601 $ 954,871 $ 6,712,697
Other long-term debt 1,201,982 8,759,018 1,691,316 9,710,453
----------- ------------ ----------- ------------
2,418,900 14,263,619 2,646,187 16,423,150
Capitalized lease obligations 370,035 57,541 785,378 408,465
----------- ------------ ----------- ------------
$ 2,788,935 $ 14,321,160 $ 3,431,565 $ 16,831,615
----------- ------------ ----------- ------------
</TABLE>
Payments of debt are scheduled as follows:
F-20
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
1999 $ 2,788,935
2000 2,659,428
2001 3,058,918
2002 1,675,922
2003 1,451,542
2004 1,441,594
Later years 4,033,756
-----------
$17,110,095
-----------
The debt secured by property is collateralized by land and buildings with a net
book value of $16,984,998 at June 30, 1998 ($13,346,340 at June 30, 1997). The
debt secured by property generally has original terms ranging from five to ten
years and is repayable in either quarterly or annual installments. Debt secured
by property bears interest at rates ranging from 5.50% to 10.00%.
Other long-term debt consists primarily of term notes payable under the
Company's lines of credit arrangements and are secured by a guarantee from DIMON
Incorporated. All such notes have original terms ranging up to a maximum of five
years, are repayable in either quarterly or annual installments, and bear
interest at rates ranging from 4.99% to 7.25%. The long-term debt agreements
contain no financial covenants or other restrictions.
As mentioned in Note 3, immediately subsequent to the sale of the Company, a
substantial portion of the existing debt balances were repaid and replaced by
borrowing facilities managed by U.S.A. Floral Products, Inc. and its
subsidiaries.
F-21
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
9. Leases
The Company has both capital and operating leases. The operating leases
are for buildings, automobiles and other equipment. Annual rent expense
under operating leases amounted to S3,478,967, $4,081,220 and
$4,255,845 for the years ended June 30, 1998, 1997 and 1996
respectively.
Capital leases are for trucks and other equipment. The capitalized
lease obligations are payable through 2000. Interest rates are imputed
at 7.81% to 16.72%. Minimum future obligations and capitalized amounts
are as follows:
<TABLE>
<CAPTION>
Capital Operating
Leases Leases
<S> <C> <C>
1999 $ 389,973 $ 2,700,000
2000 58,890 2,000,000
2001 - 1,350,000
2002 - 670,000
2003 - 340,000
2004 - -
Later years - -
----------- -----------
448,863 $ 7,060,000
-----------
Less amount representing interest 21,287
-----------
Present value of net minimum lease payments 427,576
Less current portion of obligations under capital leases 370,035
-----------
Long-term obligations under capital leases $ 57,541
-----------
Capitalized amounts:
Machinery and equipment, primarily vehicles $ 1,208,340
Accumulated amortization (850,364)
-----------
$ 357,976
-----------
</TABLE>
10. Income Taxes
Combined retained earnings at June 30,1998 include undistributed
earnings of $4,868,353 of certain foreign subsidiaries which are not
subject to additional foreign income taxes nor considered to be subject
to United States income taxes unless remitted as dividends. The Company
intends to permanently reinvest these undistributed earnings;
accordingly, no provision has been made for United States taxes on such
earnings.
At June 30, 1998, the Company has net operating tax loss carryforwards
of approximately $12,861,897 for income tax purposes that expire in
1999 and thereafter.
F-22
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
The components of income before income taxes and minority interest consist of
the following:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
U.S. $ 1,003,185 $ 1,104,877 $ 716,749
Foreign 3,303,167 7,901,215 4,715,601
------------- ------------- -------------
$ 4,306,352 $ 9,006,092 $ 5,432,350
============= ============= =============
</TABLE>
The details of the amounts shown for income taxes in the Statement of Combined
Income are as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
Current:
Federal $ 341,106 220,535 $(1,027,561)
State 42,941 60,909 $ 20,711
Foreign 2,137,701 3,463,498 1,888,858
------------- ------------- -------------
2,521,748 3,744,942 882,008
============= ============= =============
Deferred:
Federal 11,533 52,288 715,098
State - - -
Foreign (52,401) (246,821) 229,294
------------- ------------- -------------
Total (40,868) (194,533) 944,392
------------- ------------- -------------
$ 2,480,880 $ 3,550,409 $ 1,826,400
============= ============= =============
</TABLE>
The reasons for the difference between income tax expense based on income before
income taxes and minority interest and the amount computed by applying the
statutory Federal income tax rate to such income are as follows:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
Computed "expected" tax expense $ 1,507,223 $ 3,152,132 $ 1,901,323
State income taxes, net of Federal
income tax benefit 27,912 39,591 13,462
Prior years' income tax adjustments 239,692 2,258,227 434,111
Effect of foreign income taxes 759,018 (1,221,821) 792,322
U.S. taxes on foreign income, net of tax credits (15,000) (24,597) -
Operating loss carryforwards, net (46,352) (659,842) (908,718)
Permanent items 8,387 6,719 (406,100)
------------- ------------- -------------
Actual tax expense $ 2,480,880 $ 3,550,409 $ 1,826,400
============= ============= =============
</TABLE>
F-23
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
<TABLE>
<CAPTION>
The long-term deferred tax liabilities (assets) are comprised of the following:
1998 1997
<S> <C> <C>
Deferred tax liabilities:
Fixed assets $ 3,878,595 $ 3,503,380
Other 867,422 165,708
----------- -----------
Gross deferred tax liabilities 4,746,017 3,669,088
----------- -----------
Deferred tax assets:
Tax loss carryforwards (893,426) (1,028,253)
Equity currency conversion (993,870) (733,437)
Other (625,043) (161,811)
----------- -----------
Gross deferred tax assets (2,512,339) (1,923,501)
----------- -----------
Net deferred tax liability $ 2,233,678 $ 1,745,587
----------- -----------
</TABLE>
11. Retirement Benefits
The Company maintains several unfunded defined benefit pension plans in Germany,
Austria, and Italy. Net pension cost included the following components:
<TABLE>
<CAPTION>
1998 1997 1996
<S> <C> <C> <C>
Service cost $ 66,868 $ 72,862 $ 65,259
Interest on projected benefit obligation 162,036 167,999 165,948
Amortization of prior service cost 11,527 7,844 7,877
Amortization of unrecognized loss 13,367 18,083 11,002
------------- ------------- -------------
Net pension cost $ 253,798 $ 266,788 $ 250,086
------------- ------------- -------------
</TABLE>
In addition, employees in the Netherlands are beneficiaries to
non-participating annuity contracts entered into by the Company. The
premium expense recorded was $241,554, $252,649 and $228,148 in 1998,
1997 and 1996, respectively.
F-24
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
Components of net pension liability are as follows:
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
Actuarial present value of accumulated benefit obligation:
Vested $ 2,494,868 $ 2,073,047
Non-vested 2,474 2,213
----------- -----------
2,497,342 2,075,260
Benefits attributable to projected salary increases 7,321 6,622
----------- -----------
2,504,663 2,081,882
Unrecognized prior service costs (149,003) (165,729)
Unrecognized net loss (623,744) (242,099)
----------- -----------
Net pension liability $ 1,731,916 $ 1,674,054
----------- -----------
</TABLE>
The projected benefit obligations for the plans were determined using the
following assumed discount rates:
1998 1997 1996
Germany 6.50% 7.00% 7.75%
Austria 6.50% 6.50% 6.50%
Italy 9.00% 9.00% 9.00%
Assumed compensation increases were:
1998 1997 1996
Germany 0.00% 0.00% 0.00%
Austria 4.50% 4.50% 4.00%
Italy 4.00% 5.00% 5.00%
F-25
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
12. Geographic Area Data
The following tables present the Company's operations in different
geographic areas in conformity with Statement of Financial Accounting
Standards No. 14, "Financial Reporting for Segments of a Business
Enterprise."
<TABLE>
<CAPTION>
1998
---------------------------------------------------
Sales and Operating
Other Profit As
Operating Defined by Identifiable
Revenues SFAS14 Assets
<S> <C> <C> <C>
United States $ 25,667,886 $ 1,343,710 $ 37,705,525
Europe 314,323,101 5,418,783 48,138,126
Other 51,446,683 733,729 5,226,022
-------------- -------------- --------------
$391,437,670 $ 7,496,222 91,069,673
==============
Corporate (1,242,471) 8,234,234
-------------- --------------
$ 99,303,907
==============
Operating profit before interest expense 6,253,751
Interest expense (1,947,399)
--------------
Income before minority interest $ 4,306,352
==============
<CAPTION>
1997
---------------------------------------------------
Sales and Operating
Other Profit As
Operating Defined by Identifiable
Revenues SFAS14 Assets
<S> <C> <C> <C>
United States $ 21,499,788 $ 923,757 $ 36,160,856
Europe 321,845,756 8,241,310 40,267,259
Other 44,202,319 1,182,451 5,788,037
-------------- -------------- --------------
$387,547,863 10,347,518 82,216,152
==============
Corporate 1,153,591 5,559,020
-------------- --------------
$ 87,775,172
==============
Operating profit before interest expense 11,501,109
Interest expense (2,495,017)
--------------
Income before minority interest $ 9,006,092
==============
</TABLE>
F-26
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
<TABLE>
<CAPTION>
1996
------------------------------------------------
Sales and Operating
Other Profit As
Operating Defined by Identifiable
Revenues SFAS14 Assets
<S> <C> <C> <C>
United States $ 21,389,129 $ 640,902 $ 5,491,805
Europe 334,106,652 7,183,638 77,026,996
Other 42,406,543 2,240,335 5,391,756
------------- ----------- ------------
$ 397,902,324 10,064,875 87,910,557
=============
Corporate (862,121) 8,068,807
----------- ------------
$ 95,979,364
============
Operating profit before Interest expense 9,202,754
interest expense (3,770,404)
-----------
Income before minority interest $ 5,432,350
-----------
</TABLE>
13. Forward Exchange Contract
The Company enters into forward exchange contracts to hedge certain
foreign currency transactions for periods consistent with the terms of
the underlying transactions. While the forward contracts affect the
Company's results of operations, they do so only in connection with the
underlying transactions. As a result, they do not subject the Company
to risk from exchange movements, because gains and losses on these
contracts offset losses and gains on the transactions being hedged. At
June 30,1998, the Company had forward exchange contracts covering
German mark to US dollar transaction exposure during July of fiscal
1999 with notional amounts totaling $1.3 million.
14. Contingencies
The Company's Italian subsidiary, Agros San Remo s.r.l., is subject to
a lawsuit in the amount of $98,500 filed by its insurer, Societa
Italiana Cauzioni Sp. The claim relates to a recovery collected from
the insurer and recorded by the Company during the fiscal year ended
June 30, 1997. The full amount of the claim has been accrued in the
June 30, 1998 balance sheet.
Baardse B.V., a Dutch subsidiary, is subject to a lawsuit in the amount
of $235,000 filed by a former trade agent. The claim relates to
compensation in connection with the termination of the related agency
agreement. The Company believes that the ultimate losses from the claim
will not exceed $99,000 and has accordingly accrued such amount in the
June 30, 1998 balance sheet.
F-27
<PAGE>
Florimex
Notes to Combined Financial Statements
June 30, 1998 and 1997
The U.S. Department of Commerce (the "DOC") has periodically reviewed the
margins of flower growers in Colombia and Ecuador. As a result of these reviews,
the DOC has determined that certain anti-dumping duties paid by flower importers
in prior periods were inadequate and additional anti-dumping duties have been
imposed.
The Company's importation of flowers is subject to anti-dumping duties. However,
the DOC has never imposed an additional anti-dumping duty on the Company based
on the DOC's review of prior periods. Included in selling, general and
administrative expenses is approximately $90,000 of anti-dumping duties incurred
during the year ended June 30, 1998. The Company believes no accrual at June 30,
1998 for estimated anti-dumping duties imposed by the DOC is necessary. However,
the effect of any adverse determination by the DOC regarding anti-dumping duties
cannot be determined.
F-28
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
2.1* Stock and Asset Purchase Agreement by and between DIMON
Incorporated and Florimex Worldwide GmbH, and U.S.A.
Floral Products, Inc.
4.1* Credit Agreement among U.S.A. Floral Products, Inc.,
U.S.A. Floral Products Germany GmbH & Co. KG, Florimex
Worldwide B.V., Various Lending Institutions, Bayerische
Hypo-Und Vereinsbank AG, as Syndication Agent,
BankBoston, N.A., as Documentation Agent, and Bankers
Trust Company, as Arranger and Administrative Agent,
dated as of October 16, 1997 and Amended and Restated as
of October 2, 1998.
23.1** Consent of PricewaterhouseCoopers LLP
23.2** Consent of Kidsons Imprey
23.3** Consent of Sonderehoff & Einsel
23.4** Consent of AUDICONT
- ------------
* Previously filed as part of the Company's Current Report on Form 8-K, filed
on October 15, 1998 (File No. 000-23121), and omitted pursuant to General
Instruction B.3 of Form 8-K.
** Filed herewith.
<PAGE>
Exhibit 23.1
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (SEC File No. 333-39923) of U.S.A. Floral Products, Inc.
of our report dated November 18, 1998, relating to the combined financial
statements of Florimex which appears in this Current Report on Form 8-K/A.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Charlotte, NC
December 10, 1998
<PAGE>
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (SEC File No. 333-39923) of USA Floral Products, Inc. of
our report dated 9 December 1998, relating to the financial statements of
Florimex (UK) Limited which appears in this Current Report on Form 8-K/A.
/s/ Kidsons Impey
Kidsons Impey
Chartered Accountants
Devonshire House
36 George Street
Manchester
M1 4HA
United Kingdom
9 December 1998
<PAGE>
Exhibit 23.3
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (SEC File No. 333-39923) of U.S.A. Floral Products, Inc.
of our report dated July 10, 1998, relating to the financial statements of
Florimex (Japan) Limited which appears in this Current Report on Form 8-K/A.
Sonderhoff & Einsel
Tokyo, Japan
December 10, 1998
/s/ Masao Ishikawa
Masao Ishikawa
Certified Public Accountant in Japan
<PAGE>
Exhibit 23.4
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (SEC File No. 333-39923) of U.S.A. Floral Products, Inc.
of our report dated July 17, 1998, relating to the financial statements of
Florimex Milano Srl which appears in this Current Report on Form 8-K/A.
/s/ AUDICONT SAS
AUDICONT SAS
Milan, Italy
December 9, 1998
