Condensed Consolidating Financial Statements of Aramark and Subsidiaries

3 Months Ended

Dec. 27, 2019

Condensed Financial Information Disclosure [Abstract]

Condensed Consolidating Financial Statements of Aramark and Subsidiaries

CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF ARAMARK AND SUBSIDIARIES:

The following condensed consolidating financial statements of the Company have been prepared pursuant to Rule 3-10 of Regulation S-X.

The condensed consolidating financial statements are presented for: (i) Aramark (the "Parent"); (ii) ASI and Aramark International Finance S.à r.l. (the "Issuers"); (iii) the guarantors; (iv) the non guarantors; (v) elimination entries necessary to consolidate the Parent with the Issuers, the guarantors and non guarantors; and (vi) the Company on a consolidated basis. Each of the guarantors is wholly-owned, directly or indirectly, by the Company. The 5.125% Senior Notes due 2024 (the "2024 Notes"), 5.000% Senior Notes due April 1, 2025 (the "5.000% 2025 Notes"), 3.125% Senior Notes due April 1, 2025 (the "3.125% 2025 Notes" and, together with the 5.000% 2025 Notes, the "2025 Notes"), 4.75% Senior Notes due June 1, 2026 ("2026 Notes") and 5.000% Senior Notes due February 1, 2028 (the "2028 Notes") are obligations of the Company's wholly-owned subsidiary, ASI, (other than the 3.125% 2025 Notes, which are obligations of the Company's wholly owned subsidiary, Aramark International Finance S.a.r.l) and are each jointly and severally guaranteed on a senior unsecured basis by the Company and substantially all of the Company's existing and future domestic subsidiaries (excluding the Receivables Facility subsidiary) ("Guarantors"). All other subsidiaries of the Company, either direct or indirect, are non-guarantors and do not guarantee the 2024 Notes, 2025 Notes, 2026 Notes or 2028 Notes ("Non Guarantors"). The Guarantors also guarantee certain other debt. These condensed consolidating financial statements have been prepared from the Company's financial information on the same basis of accounting as the condensed consolidated financial statements. Interest expense and certain other costs are partially allocated to all of the subsidiaries of the Company. Goodwill and other intangible assets have been allocated to the subsidiaries based on management's estimates.

CONDENSED CONSOLIDATING BALANCE SHEETS

December 27, 2019

(in thousands)



	Aramark (Parent)		Issuers		Guarantors		Non Guarantors		Eliminations			Consolidated
ASSETS
Current Assets:
Cash and cash equivalents	$	5	$	35,168	$	33,544	$	195,901	$	—		$	264,618
Receivables	—		1,388		551,947		1,418,604		—			1,971,939
Inventories	—		15,567		284,698		97,668		—			397,933
Prepayments and other current assets	—		46,536		68,272		79,609		—			194,417
Total current assets	5		98,659		938,461		1,791,782		—			2,828,907
Property and Equipment, net	—		43,896		1,763,268		350,998		—			2,158,162
Goodwill	—		173,104		4,695,304		668,617		—			5,537,025
Investment in and Advances to Subsidiaries	3,451,571		6,532,122		—		745,792		(10,729,485		)	—
Other Intangible Assets	—		21,526		1,804,342		187,905		—			2,013,773
Operating Lease Right-of-use Assets	—		20,700		457,597		83,575		—			561,872
Other Assets	—		18,440		798,897		357,991		(2,002		)	1,173,326
	$	3,451,576	$	6,908,447	$	10,457,869	$	4,186,660	$	(10,731,487	)	$	14,273,065
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term borrowings	$	—	$	6,662	$	27,491	$	48,828	$	—		$	82,981
Current operating lease liabilities	—		2,194		54,742		18,815		—			75,751
Accounts payable	—		128,402		421,271		305,541		—			855,214
Accrued expenses and other current liabilities	—		208,474		710,173		364,812		88			1,283,547
Total current liabilities	—		345,732		1,213,677		737,996		88			2,297,493
Long-term Borrowings	—		6,076,564		76,619		934,537		—			7,087,720
Noncurrent Operating Lease Liabilities	—		17,348		263,244		64,908		—			345,500
Deferred Income Taxes and Other Noncurrent Liabilities	—		366,329		549,167		165,272		—			1,080,768
Intercompany Payable	—		—		4,411,209		385,850		(4,797,059		)	—
Redeemable Noncontrolling Interest	—		—		10,008		—		—			10,008
Total Stockholders' Equity	3,451,576		102,474		3,933,945		1,898,097		(5,934,516		)	3,451,576
	$	3,451,576	$	6,908,447	$	10,457,869	$	4,186,660	$	(10,731,487	)	$	14,273,065

CONDENSED CONSOLIDATING BALANCE SHEETS

September 27, 2019

(in thousands)



	Aramark (Parent)		Issuers		Guarantors		Non Guarantors		Eliminations			Consolidated
ASSETS
Current Assets:
Cash and cash equivalents	$	5	$	33,510	$	40,544	$	172,584	$	—		$	246,643
Receivables	—		1,966		522,627		1,282,371		—			1,806,964
Inventories	—		15,804		301,091		94,424		—			411,319
Prepayments and other current assets	—		27,164		82,666		83,631		—			193,461
Total current assets	5		78,444		946,928		1,633,010		—			2,658,387
Property and Equipment, net	—		43,329		1,784,410		354,023		—			2,181,762
Goodwill	—		173,104		4,694,549		651,147		—			5,518,800
Investment in and Advances to Subsidiaries	3,320,042		6,649,119		—		717,228		(10,686,389		)	—
Other Intangible Assets	—		29,684		1,819,315		184,567		—			2,033,566
Other Assets	—		20,382		979,350		346,076		(2,002		)	1,343,806
	$	3,320,047	$	6,994,062	$	10,224,552	$	3,886,051	$	(10,688,391	)	$	13,736,321
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term borrowings	$	—	$	6,256	$	27,924	$	35,748	$	—		$	69,928
Accounts payable	—		127,640		507,903		363,974		—			999,517
Accrued expenses and other current liabilities	—		241,523		1,030,074		364,168		88			1,635,853
Total current liabilities	—		375,419		1,565,901		763,890		88			2,705,298
Long-term Borrowings	—		6,090,487		82,394		439,358		—			6,612,239
Deferred Income Taxes and Other Noncurrent Liabilities	—		380,453		569,409		138,960		—			1,088,822
Intercompany Payable	—		—		4,187,591		726,464		(4,914,055		)	—
Redeemable Noncontrolling Interest	—		—		9,915		—		—			9,915
Total Stockholders' Equity	3,320,047		147,703		3,809,342		1,817,379		(5,774,424		)	3,320,047
	$	3,320,047	$	6,994,062	$	10,224,552	$	3,886,051	$	(10,688,391	)	$	13,736,321

CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

For the three months ended December 27, 2019

(in thousands)



	Aramark (Parent)		Issuers			Guarantors		Non Guarantors		Eliminations			Consolidated
Revenue	$	—	$	268,435		$	2,840,056	$	1,145,106	$	—		$	4,253,597
Costs and Expenses:
Cost of services provided	—		246,308			2,473,177		1,048,628		—			3,768,113
Depreciation and amortization	—		11,944			109,237		26,755		—			147,936
Selling and general corporate expenses	—		30,179			46,240		6,836		—			83,255
Interest and other financing costs, net	—		74,769			645		4,171		—			79,585
Expense allocations	—		(69,599		)	65,378		4,221		—			—
	—		293,601			2,694,677		1,090,611		—			4,078,889
Income (Loss) before Income Tax	—		(25,166		)	145,379		54,495		—			174,708
Provision (Benefit) for Income Taxes	—		(7,352		)	22,209		13,968		—			28,825
Equity in Net Income of Subsidiaries	145,761		—			—		—		(145,761		)	—
Net income (loss)	145,761		(17,814		)	123,170		40,527		(145,761		)	145,883
Less: Net income attributable to noncontrolling interest	—		—			122		—		—			122
Net income (loss) attributable to Aramark stockholders	145,761		(17,814		)	123,048		40,527		(145,761		)	145,761
Other comprehensive income, net of tax	21,200		8,018			1,486		36,544		(46,048		)	21,200
Comprehensive income (loss) attributable to Aramark stockholders	$	166,961	$	(9,796	)	$	124,534	$	77,071	$	(191,809	)	$	166,961

CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

For the three months ended December 28, 2018

(in thousands)



	Aramark (Parent)			Issuers			Guarantors			Non Guarantors			Eliminations			Consolidated
Revenue	$	—		$	268,522		$	2,848,927		$	1,147,900		$	—		$	4,265,349
Costs and Expenses:
Cost of services provided	—			246,609			2,464,602			1,083,234			—			3,794,445
Depreciation and amortization	—			4,472			120,982			25,267			—			150,721
Selling and general corporate expenses	—			55,742			41,552			6,836			—			104,130
Gain on sale of Healthcare Technologies	—			—			(157,309		)	—			—			(157,309		)
Interest and other financing costs, net	—			78,560			971			3,447			—			82,978
Expense allocations	—			(230,589		)	225,801			4,788			—			—
	—			154,794			2,696,599			1,123,572			—			3,974,965
Income before Income Taxes	—			113,728			152,328			24,328			—			290,384
Provision for Income Taxes	—			8,741			25,000			5,967			—			39,708
Equity in Net Income of Subsidiaries	250,682			—			—			—			(250,682		)	—
Net income	250,682			104,987			127,328			18,361			(250,682		)	250,676
Less: Net loss attributable to noncontrolling interest	—			—			(6		)	—			—			(6		)
Net income attributable to Aramark stockholders	250,682			104,987			127,334			18,361			(250,682		)	250,682
Other comprehensive loss, net of tax	(41,773		)	(27,351		)	—			(44,951		)	72,302			(41,773		)
Comprehensive income (loss) attributable to Aramark stockholders	$	208,909		$	77,636		$	127,334		$	(26,590	)	$	(178,380	)	$	208,909

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

For the three months ended December 27, 2019

(in thousands)



	Aramark (Parent)		Issuers			Guarantors			Non Guarantors			Eliminations		Consolidated
Net cash used in operating activities	$	—	$	(38,011	)	$	(153,914	)	$	(117,559	)	$	—	$	(309,484	)
Cash flows from investing activities:
Purchases of property and equipment and other	—		(12,141		)	(72,678		)	(14,377		)	—		(99,196		)
Disposals of property and equipment	—		324			438			2,884			—		3,646
Acquisitions of businesses, net of cash acquired	—		—			(3,205		)	(3,897		)	—		(7,102		)
Proceeds from governmental agencies related to property and equipment	—		—			15,250			—			—		15,250
Other investing activities	—		(14		)	(1,380		)	1,445			—		51
Net cash used in investing activities	—		(11,831		)	(61,575		)	(13,945		)	—		(87,351		)
Cash flows from financing activities:
Proceeds from long-term borrowings	—		—			—			58,671			—		58,671
Payments of long-term borrowings	—		(21,151		)	(7,765		)	(9,469		)	—		(38,385		)
Net change in funding under the Receivables Facility	—		—			—			450,000			—		450,000
Payments of dividends	—		(27,483		)	—			—			—		(27,483		)
Proceeds from issuance of common stock	—		26,089			—			—			—		26,089
Repurchase of common stock	—		—			—			—			—		—
Other financing activities	—		(56,471		)	(858		)	—			—		(57,329		)
Change in intercompany, net	—		130,516			217,112			(347,628		)	—		—
Net cash provided by financing activities	—		51,500			208,489			151,574			—		411,563
Effect of foreign exchange rates on cash and cash equivalents	—		—			—			3,247			—		3,247
Increase (decrease) in cash and cash equivalents	—		1,658			(7,000		)	23,317			—		17,975
Cash and cash equivalents, beginning of period	5		33,510			40,544			172,584			—		246,643
Cash and cash equivalents, end of period	$	5	$	35,168		$	33,544		$	195,901		$	—	$	264,618

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

For the three months ended December 28, 2018

(in thousands)



	Aramark (Parent)		Issuers			Guarantors			Non Guarantors			Eliminations			Consolidated
Net cash provided by (used in) operating activities	$	—	$	172,881		$	(328,363	)	$	(43,680	)	$	(4,500	)	$	(203,662	)
Cash flows from investing activities:
Purchases of property and equipment and other	—		(4,454		)	(89,443		)	(20,503		)	—			(114,400		)
Disposals of property and equipment	—		50			564			340			—			954
Proceeds from divestiture	—		—			293,711			—			—			293,711
Acquisitions of businesses, net of cash acquired	—		—			(5,033		)	(224		)	—			(5,257		)
Proceeds from governmental agencies related to property and equipment	—		—			16,200			—			—			16,200
Other investing activities	—		862			1,744			337			—			2,943
Net cash (used in) provided by investing activities	—		(3,542		)	217,743			(20,050		)	—			194,151
Cash flows from financing activities:
Proceeds from long-term borrowings	—		—			—			72,723			—			72,723
Payments of long-term borrowings	—		(278,339		)	(8,781		)	(26,911		)	—			(314,031		)
Net change in funding under the Receivables Facility	—		—			—			390,000			—			390,000
Payments of dividends	—		(27,161		)	—			—			—			(27,161		)
Proceeds from issuance of common stock	—		1,077			—			—			—			1,077
Repurchase of common stock	—		(50,000		)	—			—			—			(50,000		)
Other financing activities	—		(23,447		)	(929		)	(113		)	—			(24,489		)
Change in intercompany, net	—		203,883			121,522			(329,905		)	4,500			—
Net cash (used in) provided by financing activities	—		(173,987		)	111,812			105,794			4,500			48,119
Effect of foreign exchange rates on cash and cash equivalents	—		—			—			(3,752		)	—			(3,752		)
(Decrease) increase in cash and cash equivalents	—		(4,648		)	1,192			38,312			—			34,856
Cash and cash equivalents, beginning of period	5		50,716			29,844			134,460			—			215,025
Cash and cash equivalents, end of period	$	5	$	46,068		$	31,036		$	172,772		$	—		$	249,881