SEC Filings
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| 8-K | |
| HRG GROUP, INC. filed this Form 8-K on 11/22/2016 | |
| Entire Document | |
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Important Notes Regarding the Presentation of our Segments: On November 8, 2015, FGL and Anbang Insurance Group Co., Ltd. and certain of its subsidiaries ("Anbang") entered into a definitive merger agreement pursuant to which Anbang, subject to satisfaction of applicable closing conditions, will acquire FGL for $26.80 per share in cash. On November 3, 2016, subsequent to the end of Fiscal 2016, FGL and Anbang amended the merger agreement to extend the outside termination date for the completion of the FGL merger to February 8, 2017. The Company owns 47 million shares in FGL, representing an approximately 80.4% interest as of September 30, 2016. As a result of this agreement, the Company's investment in FGL has been classified as held for sale on the balance sheet and FGL's operations have been classified as discontinued operations. Results for all periods have been reclassified accordingly. FGL's results were previously reflected in the Insurance segment; however, all segment information has been adjusted to exclude FGL's results from this segment. Accordingly, the commentary for the Insurance segment in this release does not reflect the performance of FGL in either the current or prior years and quarters. On August 23, 2016, HGI Energy Holdings, LLC ("HGI Energy"), a wholly-owned subsidiary of the Company, completed the sale of its equity interests in Compass Production Partners and its subsidiaries ("Compass") to a third party. Following the completion of the sale, the Company no longer owns, directly or indirectly, any oil and gas properties. Accordingly, the results of Compass are presented as discontinued operations, and the operations of HGI Energy are included in the Corporate and Other segment. The operations of Salus Capital Partners, LLC ("Salus"), Energy & Infrastructure Capital, LLC ("EIC") and CorAmerica Capital, LLC ("CorAmerica"), each an asset manager subsidiary of the Company, were historically presented in the Asset Management segment. During the fourth quarter of Fiscal 2016, the Company sold all of its interest in CorAmerica to a third party. In addition, the Company has been winding down the operations of Salus, and during the Fiscal 2016 Quarter, completed the wind down of EIC's operations. Due to the diminished operations of these businesses, the Company is presenting the operations of Salus, EIC and CorAmerica within the Corporate and Other segment. All historical results have been restated to reflect this change. Additional Items: Compass Sale As described above, during the Fiscal 2016 Quarter, HGI Energy sold its equity interest in Compass to a third party. The cash proceeds received by HGI Energy, net of the balance of Compass' credit facility outstanding at the time of the close, were $19.8 million. The historical results of Compass have been reflected in discontinued operations and the Company recognized a $53.6 million gain on the disposal in the Fiscal 2016 Quarter, which is also reflected in discontinued operations. Discontinued Operations During the Fiscal 2016 Quarter, the Company recorded net $45.8 million in income from discontinued operations, driven primarily by the gain on the Compass sale. In Fiscal 2016, the Company recorded a $224.3 million loss from discontinued operations, driven primarily by the previously-reported write-down of the asset held for sale (specifically, FGL) to its fair value less cost to sell, in accordance with US GAAP. Detail on Fiscal 2016 Quarter and Fiscal 2016 Segment Results: Consumer Products: Note: Organic net sales, as described below, is a non-U.S. GAAP measure defined as net sales excluding the effect of changes in foreign currency exchange rates and impact from acquisitions. Adjusted EBITDA-Consumer Products, as described below, is a non-U.S. GAAP measure that excludes interest, income tax expense, certain purchase accounting fair value adjustments, restructuring and related charges, acquisition and integration related charges, depreciation and amortization expenses and stock-based compensation. See "Non-U.S. GAAP Measures" and the reconciliation of Reported Net Sales to Organic Net Sales and Adjusted EBITDA-Consumer Products to the Consumer Product segment's net income or loss in the tables accompanying this release. Consumer Products reported consolidated net sales of $1,249.7 million for the Fiscal 2016 Quarter, a decrease of $58.4 million, or 4.5%, as compared to the $1,308.1 million reported in the Fiscal 2015 Quarter. Excluding the impact of $17.0 million in unfavorable foreign exchange, sales decreased $41.4 million, or 3.2%, as compared to the Fiscal 3 | |
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