Quarterly report pursuant to Section 13 or 15(d)

Note 17 - Financial Information About the Parent, the Issuer and the Guarantors

v2.4.0.6
Note 17 - Financial Information About the Parent, the Issuer and the Guarantors
9 Months Ended
Mar. 31, 2012
Condensed Financial Information of Parent Company Only Disclosure [Text Block]
(17)   Financial Information About the Parent, the Issuer and the Guarantors

On September 27, 2005, Global (the "Issuer") issued $200 million aggregate principal amount of Senior Notes which have been guaranteed on a senior basis by Interiors (the "Parent"), and other wholly owned domestic subsidiaries of the Issuer and the Parent, including Ethan Allen Retail, Inc., Ethan Allen Operations, Inc., Ethan Allen Realty, LLC, Lake Avenue Associates, Inc. and Manor House, Inc. The subsidiary guarantors (other than the Parent) are collectively called the "Guarantors". The guarantees of the Guarantors are unsecured. All of the guarantees are full, unconditional and joint and several and the Issuer and each of the Guarantors are 100% owned by the Parent. Our other subsidiaries which are not guarantors are called the "Non-Guarantors".

The following tables set forth the condensed consolidating balance sheets as of March 31, 2012 and June 30, 2011, the condensed consolidating statements of operations for the three and nine months ended March 31, 2012 and 2011, and the condensed consolidating statements of cash flows for the nine months ended March 31, 2012 and 2011 of the Parent, the Issuer, the Guarantors and the Non-Guarantors.

CONDENSED CONSOLIDATING BALANCE SHEET

(In thousands)

March 31, 2012

   
Parent
   
Issuer
   
Guarantors
   
Non-Guarantors
   
Eliminations
   
Consolidated
 
Assets
                                   
Current assets:
                                   
Cash and cash equivalents
  $ -     $ 61,042     $ 9,381     $ 2,707     $ -     $ 73,130  
Marketable securities
    -       11,259       -       -       -       11,259  
Accounts receivable, net
    -       17,019       552       -       -       17,571  
Inventories
    -       -       168,992       4,717       (31,447 )     142,262  
Prepaid expenses and other current assets
    -       6,948       14,552       2,709       -       24,209  
Intercompany receivables
    -       820,578       267,656       (9,029 )     (1,079,205 )     -  
Total current assets
    -       916,846       461,133       1,104       (1,110,652 )     268,431  
Property, plant and equipment, net
    -       8,501       274,047       14,663       -       297,211  
Goodwill and other intangible assets
    -       37,905       7,223       -       -       45,128  
Restricted cash and investments
    -       15,410       -       -       -       15,410  
Other assets
    -       6,445       806       -       -       7,251  
Investment in affiliated companies
    645,567       (106,422 )     -       -       (539,145 )     -  
Total assets
  $ 645,567     $ 878,685     $ 743,209     $ 15,767     $ (1,649,797 )   $ 633,431  
Liabilities and Shareholders’ Equity
                                               
Current liabilities:
                                               
Current maturities of long-term debt
  $ -     $ -     $ 192     $ -     $ -     $ 192  
Customer deposits
    -       -       59,040       2,472       -       61,512  
Accounts payable
    -       8,949       17,382       324       -       26,655  
Accrued expenses and other current liabilities
    2,163       37,238       15,156       1,018       -       55,575  
Intercompany payables
    325,684       327       743,874       9,320       (1,079,205 )     -  
Total current liabilities
    327,847       46,514       835,644       13,134       (1,079,205 )     143,934  
Long-term debt
    -       152,955       1,103       -       -       154,058  
Other long-term liabilities
    -       3,789       13,843       87       -       17,719  
Total liabilities
    327,847       203,258       850,590       13,221       (1,079,205 )     315,711  
Shareholders’ equity
    317,720       675,427       (107,381 )     2,546       (570,592 )     317,720  
Total liabilities and shareholders’ equity
  $ 645,567     $ 878,685     $ 743,209     $ 15,767     $ (1,649,797 )   $ 633,431  

CONDENSED CONSOLIDATING BALANCE SHEET

(In thousands)

June 30, 2011

   
Parent
   
Issuer
   
Guarantors
   
Non-Guarantors
   
Eliminations
   
Consolidated
 
Assets
                                   
Current assets:
                                   
Cash and cash equivalents
  $ -     $ 69,763     $ 7,716     $ 1,040     $ -     $ 78,519  
Marketable securities
    -       12,909       -       -       -       12,909  
Accounts receivable, net
    -       13,609       174       1,253       -       15,036  
Inventories
    -       -       164,938       4,554       (27,800 )     141,692  
Prepaid expenses and other current assets
    -       4,598       14,866       908       -       20,372  
Intercompany receivables
    -       784,285       249,461       (8,423 )     (1,025,323 )     -  
Total current assets
    -       885,164       437,155       (668 )     (1,053,123 )     268,528  
Property, plant and equipment, net
    -       8,023       276,057       10,773       -       294,853  
Goodwill and other intangible assets
    -       37,905       7,223       -       -       45,128  
Restricted cash and investments
    -       16,391       -       -       -       16,391  
Other assets
    -       2,700       725       -       -       3,425  
Investment in affiliated companies
    602,699       (93,132 )     -       -       (509,567 )     -  
Total assets
  $ 602,699     $ 857,051     $ 721,160     $ 10,105     $ (1,562,690 )   $ 628,325  
Liabilities and Shareholders’ Equity
                                               
Current liabilities:
                                               
Current maturities of long-term debt
  $ -     $ -     $ 19     $ -     $ -     $ 19  
Customer deposits
    -       -       59,633       3,016       -       62,649  
Accounts payable
    -       7,333       19,233       392       -       26,958  
Accrued expenses and other current liabilities
    2,130       43,212       18,746       902       -       64,990  
Intercompany payables
    318,882       597       702,748       3,096       (1,025,323 )     -  
Total current liabilities
    321,012       51,142       800,379       7,406       (1,025,323 )     154,616  
Long-term debt
    -       164,832       181       -       -       165,013  
Other long-term liabilities
    -       4,392       14,474       109       -       18,975  
Deferred income taxes
    -       8,034       -       -       -       8,034  
Total liabilities
    321,012       228,400       815,034       7,515       (1,025,323 )     346,638  
Shareholders’ equity
    281,687       628,651       (93,874 )     2,590       (537,367 )     281,687  
Total liabilities and shareholders’ equity
  $ 602,699     $ 857,051     $ 721,160     $ 10,105     $ (1,562,690 )   $ 628,325  

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

(In thousands)

Three months ended March 31, 2012

   
Parent
   
Issuer
   
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
Net sales
  $ -     $ 121,425     $ 191,275     $ 7,971     $ (144,810 )   $ 175,861  
Cost of sales
    -       89,850       127,738       4,704       (140,706 )     81,586  
Gross profit
    -       31,575       63,537       3,267       (4,104 )     94,275  
                                                 
Selling, general and administrative expenses
    45       11,969       70,748       3,710       -       86,472  
Restructuring and impairment charge, (credit) net
    -       -       16       -       -       16  
Total operating expenses
    45       11,969       70,764       3,710       -       86,488  
Operating income (loss)
    (45 )     19,606       (7,227 )     (443 )     (4,104 )     7,787  
                                                 
Interest and other miscellaneous income, net
    27,593       (6,598 )     66       (36 )     (20,868 )     157  
Interest and other related financing costs
    -       2,180       9       -       -       2,189  
Income before income tax expense
    27,548       10,828       (7,170 )     (479 )     (24,972 )     5,755  
Income tax expense
    -       (20,869 )     (947 )     23       -       (21,793 )
                                                 
Net income/(loss)
  $ 27,548     $ 31,697     $ (6,223 )   $ (502 )   $ (24,972 )   $ 27,548  

Three months ended March 31, 2011

   
Parent
   
Issuer
   
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
Net sales
  $ -     $ 104,481     $ 167,548     $ 6,692     $ (115,899 )   $ 162,822  
Cost of sales
    -       78,061       112,671       3,641       (114,620 )     79,753  
Gross profit
    -       26,420       54,877       3,051       (1,279 )     83,069  
                                                 
Selling, general and administrative expenses
    45       10,330       64,404       3,424       -       78,203  
Restructuring and impairment charge, (credit) net
    -       -       109       -       -       109  
Total operating expenses
    45       10,330       64,513       3,424       -       78,312  
Operating income (loss)
    (45 )     16,090       (9,636 )     (373 )     (1,279 )     4,757  
                                                 
Interest and other miscellaneous income, net
    3,563       (8,956 )     (1 )     (1 )     6,523       1,128  
Interest and other related financing costs
    -       2,698       75       -       -       2,773  
Income before income tax expense
    3,518       4,436       (9,712 )     (374 )     5,244       3,112  
Income tax expense
    -       (406 )     -       -       -       (406 )
                                                 
Net income/(loss)
  $ 3,518     $ 4,842     $ (9,712 )   $ (374 )   $ 5,244     $ 3,518  

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

(In thousands)

Nine months ended March 31, 2012

   
Parent
   
Issuer
   
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
Net sales
  $ -     $ 343,988     $ 582,651     $ 25,399     $ (407,981 )   $ 544,057  
Cost of sales
    -       256,237       387,435       14,340       (404,334 )     253,678  
Gross profit
    -       87,751       195,216       11,059       (3,647 )     290,379  
                                                 
Selling, general and administrative expenses
    135       34,427       209,903       10,546       -       255,011  
Restructuring and impairment charge, (credit) net
    -       -       5       -       -       5  
Total operating expenses
    135       34,427       209,908       10,546       -       255,016  
Operating income (loss)
    (135 )     53,324       (14,692 )     513       (3,647 )     35,363  
                                                 
Interest and other miscellaneous income, net
    42,530       (13,108 )     211       (30 )     (29,241 )     362  
Interest and other related financing costs
    -       6,805       9       -       -       6,814  
Income before income tax expense
    42,395       33,411       (14,490 )     483       (32,888 )     28,911  
Income tax expense
    -       (12,766 )     (777 )     59       -       (13,484 )
                                                 
Net income/(loss)
  $ 42,395     $ 46,177     $ (13,713 )   $ 424     $ (32,888 )   $ 42,395  

Nine months ended March 31, 2011

   
Parent
   
Issuer
   
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
Net sales
  $ -     $ 312,979     $ 525,023     $ 21,504     $ (358,498 )   $ 501,008  
Cost of sales
    -       237,882       352,821       11,551       (356,557 )     245,697  
Gross profit
    -       75,097       172,202       9,953       (1,941 )     255,311  
                                                 
Selling, general and administrative expenses
    135       32,381       192,283       9,501       -       234,300  
Restructuring and impairment charge, (credit) net
    -       -       393       -       -       393  
Total operating expenses
    135       32,381       192,676       9,501       -       234,693  
Operating income (loss)
    (135 )     42,716       (20,474 )     452       (1,941 )     20,618  
                                                 
Interest and other miscellaneous income, net
    22,210       (14,797 )     (30 )     4       (1,934 )     5,453  
Interest and other related financing costs
    -       8,421       228       -       -       8,649  
Income before income tax expense
    22,075       19,498       (20,732 )     456       (3,875 )     17,422  
Income tax expense
    -       (4,653 )     -       -       -       (4,653 )
                                                 
Net income/(loss)
  $ 22,075     $ 24,151     $ (20,732 )   $ 456     $ (3,875 )   $ 22,075  

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

(In thousands)

Nine months ended March 31, 2012

   
Parent
   
Issuer
   
Guarantors
   
Non-Guarantors
   
Eliminations
   
Consolidated
 
Net cash provided by (used in) operating activities
  $ 6,668     $ 2,161     $ 16,667     $ 2,337     $ -     $ 27,833  
Cash flows from investing activities:
                                               
Capital expenditures
    -       (1,592 )     (16,833 )     (1,411 )     -       (19,836 )
Acquisitions
    -       -       (520 )     -       -       (520 )
Proceeds from the disposal of property, plant and equipment
    -       -       1,792       -       -       1,792  
Change in restricted cash and investments
    -       981       -       -       -       981  
Purchase of marketable securities
    -       (3,290 )     -       -       -       (3,290 )
Proceeds from the sale of marketable securities
    -       4,675       -       -       -       4,675  
Other
    -       262       511       -       -       773  
Net cash provided by (used in) investing activities
    -       1,036       (15,050 )     (1,411 )     -       (15,425 )
                                                 
Cash flows from financing activities:
                                               
Payments on long-term debt
    -       (11,918 )     (227 )     -       -       (12,145 )
Purchases and other retirements of company stock
    (847 )     -       -       -       -       (847 )
Proceeds from issuance of common stock
    225       -       -       -       -       225  
Proceeds from noncontrolling interest
    -       -       275       -       -       275  
Dividends paid
    (6,046 )     -       -       -       -       (6,046 )
Net cash provided by (used in) financing activities
    (6,668 )     (11,918 )     48       -       -       (18,538 )
                                                 
Effect of exchange rate changes on cash
    -       -       -       741       -       741  
                                                 
Net decrease in cash and cash equivalents
    -       (8,721 )     1,665       1,667       -       (5,389 )
                                                 
Cash and cash equivalents – beginning of period
    -       69,763       7,716       1,040       -       78,519  
 
                                               
Cash and cash equivalents – end of period
  $ -     $ 61,042     $ 9,381     $ 2,707     $ -     $ 73,130  

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

(In thousands)

Nine months ended March 31, 2011

   
Parent
   
Issuer
   
Guarantors
   
Non-Guarantors
   
Eliminations
   
Consolidated
 
Net cash provided by operating activities
  $ 9,661     $ 25,531     $ 3,709     $ 1,685     $ -     $ 40,586  
                                                 
Cash flows from investing activities:
                                               
Capital expenditures
    -       (473 )     (3,585 )     (1,673 )     -       (5,731 )
Acquistions
    -       -       (611 )     -       -       (611 )
Proceeds from the disposal of property, plant and equipment
    -       -       145       -       -       145  
Change in restricted cash and investments
    -       953       -       -       -       953  
Purchase of marketable securities
    -       (8,214 )     -       -       -       (8,214 )
Proceeds from the sale of marketable securities
    -       6,069       -       -       -       6,069  
Other
    -       (456 )     -       -       -       (456 )
Net cash used in investing activities
    -       (2,121 )     (4,051 )     (1,673 )     -       (7,845 )
                                                 
Cash flows from financing activities:
                                               
Payments on long-term debt
    -       (26,038 )     (32 )     -       -       (26,070 )
Purchases and other retirements of company stock
    (5,377 )     -       -       -       -       (5,377 )
Proceeds from issuance of common stock
    29       -       -       -       -       29  
Increase in deferred financing costs
    -       (125 )     -       -       -       (125 )
Dividends paid
    (4,313 )     -       -       -       -       (4,313 )
Net cash used in financing activities
    (9,661 )     (26,163 )     (32 )     -       -       (35,856 )
                                                 
Effect of exchange rate changes on cash
    -       -       -       75       -       75  
                                                 
Net increase (decrease) in cash and cash equivalents
    -       (2,753 )     (374 )     87       -       (3,040 )
                                                 
Cash and cash equivalents – beginning of period
    -       67,269       5,720       863       -       73,852  
 
                                               
Cash and cash equivalents – end of period
  $ -     $ 64,516     $ 5,346     $ 950     $ -     $ 70,812