EXHIBIT 99.4
Preliminary Note Regarding Non-GAAP Financial Measures
This presentation includes the following financial measures: “pro forma net loss” and “adjusted EBITDA as reported to the banks.” These items are not financial measures under generally accepted accounting principles in the United States. Because these items are not GAAP financial measures, other companies may present similarly titled items determined with differing adjustments. Accordingly, these measures as presented herein should not be used to evaluate the Company’s performance by comparison to any similarly titled measures presented by other companies. The Company included these non-GAAP financial measures in response to questions it received on its conference call held July 29, 2003, and is furnishing revised versions of the schedules including these measures to conform to revisions made to the Company’s second quarter financial results as reported in the Company’s press release issued on August 13, 2003. The questions the Company received requesting this information may indicate that certain investors find this information useful in evaluating the Company’s operating performance and financial results. The Company uses the measure “adjusted EBITDA as reported to the banks” for purposes of determining its compliance with debt covenants. The following tables include reconciliations of these non-GAAP financial measures with the most comparable GAAP measurement. Investors are strongly urged to review these reconciliations. In addition, the exclusion of certain adjustment items in the calculation of “pro forma net loss” does not imply that such charges are non-recurring, infrequent or unusual. The Company has incurred similar charges in prior periods, and may incur similar charges in future periods.
Caraustar Industries, Inc.
Reconciliation of Three Months Ended June 30, 2003 Net Loss
to Pro Forma Results*
(In Thousands, Except Share Data)
| Net loss as reported |
$ | (9,835 | ) | $ | (0.35 | ) | |||||
| Adjustment items, net of tax: |
|
Pretax |
|
After-Tax |
|
||||||
| Items impacting operating income: |
|||||||||||
| Spalding receivable write-off |
$ | 3,300 | $ | 2,066 | |||||||
| Restructuring costs |
1,835 | 1,149 | |||||||||
| Paragon—asset impairment charges |
1,200 | 752 | |||||||||
| Total operating income items |
6,335 | 3,967 | |||||||||
| Write-off of deferred loan costs |
1,812 | 1,134 | |||||||||
| Write-off of Data Rich investment |
309 | 191 | |||||||||
| $ | 8,456 | $ | 5,292 | ||||||||
| Pro forma net loss |
$ | (4,543 | ) | $ | (0.16 | ) | |||||
*See Preliminary Note Regarding Non-GAAP Financial Measures
Caraustar Industries, Inc.
Calculation of Consolidated Earnings
Before Interest, Taxes, Depreciation and
Amortization (EBITDA) for Three Months Ended June 30, 2003*
(In Thousands, Except Share Data)
| Second Qtr. 2003 |
||||
| Net loss per common share as reported |
$ | (0.35 | ) | |
| Net loss as reported |
$ | (9,835 | ) | |
| Benefit for income taxes |
(4,847 | ) | ||
| Interest expense |
11,244 | |||
| Depreciation and amortization |
7,176 | |||
| Unconsolidated affiliates: |
||||
| Less: Income from unconsolidated affiliates |
(1,444 | ) | ||
| Plus: Distributions from unconsolidated affiliates |
1,650 | |||
| Ashland restructuring |
1,563 | |||
| Write-off of deferred loan fees |
1,812 | |||
| Noncash write-off of property, plant and equipment |
1,093 | |||
| Other noncash restructuring costs |
43 | |||
| Adjusted EBITDA as reported to the banks |
$ | 8,455 | ||
*See Preliminary Note Regarding Non-GAAP Financial Measures