Pro Forma Unaudited Condensed Combined Statements of Income for Lakeland and Qualytextil (Fiscal Year Ended January 31, 2008)

Contract Categories: Mergers & Acquisitions › Plan of Reorganization Agreements
Summary

This document presents the unaudited pro forma combined income statements for Lakeland and Qualytextil for the fiscal year ended January 31, 2008. It shows how the companies’ financial results would look if the acquisition of Qualytextil by Lakeland had occurred earlier, including adjustments for interest expenses and tax effects related to the financing of the purchase. The statements help investors understand the potential impact of the acquisition on earnings per share and overall financial performance.

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EX-10.25 4 ex10-25.htm EXHIBIT 10.25 ex10-25.htm
Exhibit 10.25
 
PROFORMA UNAUDITED CONDENSED COMBINED  STATEMENTS  OF INCOME
  
Combined
  
   
Historical
              
Pro forma
  
 ($000 USD)
        
QUALYTEXTIL
                    
Fiscal Year ended January 31, 2008
  
AS REPORTED
    
US GAAP /USD
    
Adjustment
    
Adjustment
        
Income Statement Data:
  
1/31/08
    
12/31/07
    
 (1)
    
 (2)
    
1/31/08
  
Net sales
   $ 95,740     $ 8,518     $ -     $ -     $ 104,258  
Cost of goods sold
     73,383       4,324       -       -       77,707  
Gross profit
     22,357       4,194       -       -       26,551  
Operating expenses
     17,374       2,847       -       -       20,221  
Operating profit
     4,983       1,347       -       -       6,330  
Other income
     145       14       -       -       159  
Interest expense
     (330 )     (680 )     (789 )     680       (1,119 )
Interest income
     67       2       -       -       69  
Income before income taxes
     4,865       683       (789 )     680       5,439  
Income tax expense
     1,574       104       (284 )     104       1,498  
Net Income
   $ 3,291     $ 579     $ (505 )   $ 576     $ 3,942  
Net income per share
   $ 0.60                             $ 0.71  
    # shares used for basic EPS
     5,522,751                               5,522,751  
ACCRETIVE TO EPS:
                                   $ 0.11  
 
 
 
 
 
 
 
Exhibit 10.25


NOTES TO: PROFORMA UNAUDITED CONDENSED COMBINED STATEMENTS OF INCOME
Fiscal year ended January 31, 2008
 
   
Adjustment
Needed
  
(1) Adjustment to reflect interest- Expense that would have been incurred on loan to finance purchase of Qualytextil
   $ 13,344  
         
Interest rate assumed on proforma loan.  Used Lakeland’s actual weighted average interest rate for the period + 40 BPS which is the pricing adjustment created by the higher leverage resulting from the purchase price borrowing
     5.91 %
         
Additional interest expense on purchase loan pro forma
   $ 789  
         
Tax rate - The Company considers the rate of 36% to be appropriate as it represents the applicable tax effect on interest expense incurred on the loan assumed in USD. The Company did not use the effective tax rate which is 32.3%, since the rate is affected by various factors not relevant to the current transaction including income from various foreign subsidiaries, deductions etc.
     36 %
         
Tax benefit on additional interest expense
   $ 284  
         
 (2) Adjustment to add back interest expense on Qualytextil books as the debt has been repaid as a result of this transaction