Guarantor Subsidiaries Financial Information

6 Months Ended

Jun. 30, 2019

Condensed Financial Information Disclosure [Abstract]

Guarantor Subsidiaries Financial Information

GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION

The obligations under the Company's 2016 Notes, 2013 Notes and Revolving Credit Facility and Term Loan are fully and unconditionally guaranteed by all U.S. subsidiaries as guarantors. Each guarantor is 100% owned by the parent company. In accordance with positions established by the Securities and Exchange Commission, the following shows separate financial information with respect to the parent, the guarantor subsidiaries and the non-guarantor subsidiaries. The principal elimination entries eliminate investment in subsidiaries and certain intercompany balances and transactions.

Balance Sheet for June 30, 2019:



In thousands	Parent		Guarantors			Non-Guarantors			Elimination			Consolidated
Cash and cash equivalents	$	7,011	$	9,820		$	444,540		$	—		$	461,371
Receivables, net	134,298		252,077			1,321,034			—			1,707,409
Inventories	141,400		662,717			1,077,674			—			1,881,791
Current assets - other	15,094		30,484			132,991			—			178,569
Total current assets	297,803		955,098			2,976,239			—			4,229,140
Property, plant and equipment, net	57,966		36,879			1,551,252			—			1,646,097
Goodwill	504,818		283,241			7,362,612			—			8,150,671
Investment in subsidiaries	16,878,245		6,134,117			—			(23,012,362		)	—
Other intangibles, net	28,594		77,301			4,258,461			—			4,364,356
Other long-term assets	27,223		166,012			359,094			—			552,329
Total assets	$	17,794,649	$	7,652,648		$	16,507,658		$	(23,012,362	)	$	18,942,593
Current liabilities	$	472,747	$	1,036,279		$	1,702,289		$	—		$	3,211,315
Inter-company	2,858,761		(1,606,278		)	(1,252,483		)	—			—
Long-term debt	4,274,718		—			254,050			—			4,528,768
Long-term liabilities - other	386,662		135,254			845,437			—			1,367,353
Total liabilities	7,992,888		(434,745		)	1,549,293			—			9,107,436
Shareholders' equity	9,786,761		8,087,393			14,939,968			(23,012,362		)	9,801,760
Non-controlling interest	15,000		—			18,397			—			33,397
Total shareholders' equity	$	9,801,761	$	8,087,393		$	14,958,365		$	(23,012,362	)	$	9,835,157
Total Liabilities and Shareholders' Equity	$	17,794,649	$	7,652,648		$	16,507,658		$	(23,012,362	)	$	18,942,593

Balance Sheet for December 31, 2018:



In thousands	Parent		Guarantors			Non-Guarantors			Elimination			Consolidated
Cash and cash equivalents	$	1,782,682	$	(119	)	$	559,791		$	—		$	2,342,354
Receivables, net	106,815		61,513			978,450			—			1,146,778
Inventories	149,622		69,116			626,148			—			844,886
Current assets - other	11,884		690			103,075			—			115,649
Total current assets	2,051,003		131,200			2,267,464			—			4,449,667
Property, plant and equipment, net	51,551		24,755			487,431			—			563,737
Goodwill	25,275		283,241			2,088,028			—			2,396,544
Investment in subsidiaries	6,707,979		4,022,107			—			(10,730,086		)	—
Other intangibles, net	29,254		78,547			1,022,079			—			1,129,880
Other long-term assets	8,775		149			100,482			—			109,406
Total assets	$	8,873,837	$	4,539,999		$	5,965,484		$	(10,730,086	)	$	8,649,234
Current liabilities	$	264,630	$	91,004		$	1,291,056		$	—		$	1,646,690
Inter-company	1,947,504		(1,436,222		)	(511,282		)	—			—
Long-term debt	3,779,627		—			13,147			—			3,792,774
Long-term liabilities - other	16,945		48,714			275,036			—			340,695
Total liabilities	6,008,706		(1,296,504		)	1,067,957			—			5,780,159
Shareholders' equity	2,865,131		5,836,503			4,893,583			(10,730,086		)	2,865,131
Non-controlling interest	—		—			3,944			—			3,944
Total shareholders' equity	$	2,865,131	$	5,836,503		$	4,897,527		$	(10,730,086	)	$	2,869,075
Total Liabilities and Shareholders' Equity	$	8,873,837	$	4,539,999		$	5,965,484		$	(10,730,086	)	$	8,649,234

Income Statement for the Three Months Ended June 30, 2019:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net Sales	$	185,695		$	1,104,741		$	1,432,790		$	(486,942	)	$	2,236,284
Cost of sales	(144,237		)	(820,294		)	(1,037,244		)	380,167			(1,621,608		)
Gross profit	41,458			284,447			395,546			(106,775		)	614,676
Total operating expenses	(67,447		)	(81,933		)	(264,659		)	—			(414,039		)
Income from operations	(25,989		)	202,514			130,887			(106,775		)	200,637
Interest (expense) income, net	(59,365		)	3,116			(2,311		)	—			(58,560		)
Other income (expense), net	1,237			(4,217		)	5,157			—			2,177
Equity earnings (loss)	185,813			83,926			—			(269,739		)	—
Pretax income (loss)	101,696			285,339			133,733			(376,514		)	144,254
Income tax benefit (expense)	2,538			(42,556		)	(1,382		)	—			(41,400		)
Net income	104,234			242,783			132,351			(376,514		)	102,854
Less: Net loss attributable to noncontrolling interest	—			—			1,381			—			1,381
Net income (loss) attributable to Wabtec shareholders	$	104,234		$	242,783		$	133,732		$	(376,514	)	$	104,235

Comprehensive income (loss) attributable to Wabtec shareholders	$	104,234		$	242,783		$	153,552		$	(376,514	)	$	124,055

Income Statement for the Three Months Ended June 30, 2018:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net Sales	$	168,426		$	137,966		$	873,375		$	(68,087	)	$	1,111,680
Cost of sales	(122,919		)	(88,688		)	(614,861		)	38,755			(787,713		)
Gross profit	45,507			49,278			258,514			(29,332		)	323,967
Total operating expenses	(49,780		)	(12,267		)	(138,397		)	—			(200,444		)
Income from operations	(4,273		)	37,011			120,117			(29,332		)	123,523
Interest (expense) income, net	(31,734		)	3,137			(3,323		)	—			(31,920		)
Other income (expense), net	483			—			1,688			—			2,171
Equity earnings (loss)	128,744			118,771			—			(247,515		)	—
Pretax income (loss)	93,220			158,919			118,482			(276,847		)	93,774
Income tax expense	(7,213		)	—			(3,290		)	—			(10,503		)
Net income	86,007			158,919			115,192			(276,847		)	83,271
Less: Net loss attributable to noncontrolling interest	—			—			1,145			—			1,145
Net income (loss) attributable to Wabtec shareholders	$	86,007		$	158,919		$	116,337		$	(276,847	)	$	84,416

Comprehensive income (loss) attributable to Wabtec shareholders	$	86,231		$	158,919		$	(74,104	)	$	(276,847	)	$	(105,801	)

Income Statement for the Six Months Ended June 30, 2019:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net Sales	$	378,761		$	1,233,544		$	2,760,039		$	(542,443	)	$	3,829,901
Cost of sales	(301,887		)	(902,309		)	(2,035,263		)	413,251			(2,826,208		)
Gross profit	76,874			331,235			724,776			(129,192		)	1,003,693
Total operating expenses	(164,987		)	(97,254		)	(473,508		)	—			(735,749		)
Income from operations	(88,113		)	233,981			251,268			(129,192		)	267,944
Interest (expense) income, net	(101,011		)	6,594			(8,712		)	—			(103,129		)
Other income (expense), net	21,570			(6,702		)	(20,919		)	—			(6,051		)
Equity earnings (loss)	277,295			163,685			—			(440,980		)	—
Pretax income (loss)	109,741			397,558			221,637			(570,172		)	158,764
Income tax expense	(9,979		)	(42,556		)	(7,388		)	—			(59,923		)
Net income	99,762			355,002			214,249			(570,172		)	98,841
Less: Net loss attributable to noncontrolling interest	—			—			922			—			922
Net income (loss) attributable to Wabtec shareholders	$	99,762		$	355,002		$	215,171		$	(570,172	)	$	99,763

Comprehensive income (loss) attributable to Wabtec shareholders	$	99,762		$	355,002		$	182,574		$	(570,172	)	$	67,166

Income Statement for the Six Months Ended June 30, 2018:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net Sales	$	329,727		$	256,083		$	1,700,594		$	(118,547	)	$	2,167,857
Cost of sales	(241,577		)	(161,678		)	(1,200,588		)	70,834			(1,533,009		)
Gross profit (loss)	88,150			94,405			500,006			(47,713		)	634,848
Total operating expenses	(85,407		)	(25,941		)	(268,698		)	—			(380,046		)
Income (loss) from operations	2,743			68,464			231,308			(47,713		)	254,802
Interest (expense) income, net	(52,128		)	6,079			(6,155		)	—			(52,204		)
Other income (expense), net	9,212			(679		)	(3,776		)	—			4,757
Equity earnings (loss)	235,442			210,877			—			(446,319		)	—
Pretax income (loss)	195,269			284,741			221,377			(494,032		)	207,355
Income tax expense	(20,895		)	—			(15,732		)	—			(36,627		)
Net income (loss)	174,374			284,741			205,645			(494,032		)	170,728
Less: Net loss attributable to noncontrolling interest	—			—			2,054			—			2,054
Net income (loss) attributable to Wabtec shareholders	$	174,374		$	284,741		$	207,699		$	(494,032	)	$	172,782

Comprehensive income (loss) attributable to Wabtec shareholders	$	174,881		$	284,741		$	95,983		$	(494,032	)	$	61,573

Condensed Statement of Cash Flows for the Six Months Ended June 30, 2019:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash (used for) provided by operating activities	$	(99,188	)	$	215,772		$	456,532		$	(129,192	)	$	443,924
Net cash provided by (used for) investing activities	6,854,818			(476,597		)	(9,418,585		)	—			(3,040,364		)
Net cash (used for) provided by financing activities	(8,531,301		)	270,764			8,857,453			129,192			726,108
Effect of changes in currency exchange rates	—			—			(10,651		)	—			(10,651		)
(Decrease) increase in cash	(1,775,671		)	9,939			(115,251		)	—			(1,880,983		)
Cash, cash equivalents, and restricted cash beginning of period	1,782,682			(119		)	559,791			—			2,342,354
Cash and cash equivalents, end of period	$	7,011		$	9,820		$	444,540		$	—		$	461,371

Condensed Statement of Cash Flows for the Six Months Ended June 30, 2018:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash (used for) provided by operating activities	$	(116,378	)	$	72,206		$	159,789		$	(47,713	)	$	67,904
Net cash (used for) provided by investing activities	(9,669		)	(249		)	(59,182		)	—			(69,100		)
Net cash provided by (used for) financing activities	125,855			(72,009		)	(78,795		)	47,713			22,764
Effect of changes in currency exchange rates	—			—			(9,395		)	—			(9,395		)
(Decrease) increase in cash	(192		)	(52		)	12,417			—			12,173
Cash and cash equivalents, beginning of period	933			625			231,843			—			233,401
Cash and cash equivalents, end of period	$	741		$	573		$	244,260		$	—		$	245,574