##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2009
 
 Or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number: 333-124100
 VWR FUNDING, INC.
 (Exact name of registrant as specified in its charter)
 Delaware(State or other jurisdiction of 
incorporation or organization)
    
    56-2445503(I.R.S. Employer
Identification No.)1310 Goshen Parkway 
P.O. Box 2656
West Chester, PA(Address of principal executive offices)
    
    19380(Zip code)
 (610) 431-1700  (Registrants telephone number, including area code)
 o þ
 Yes
o No o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




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##### 



VWR FUNDING, INC. AND SUBSIDIARIES
 FORM 10-Q
 FOR THE QUARTER ENDED SEPTEMBER 30, 2009
INDEX
 Page No.PART I. FINANCIAL INFORMATION:Item 1. Financial Statements (Unaudited):Condensed Consolidated Balance Sheets  September 30, 2009 and December 31, 2008
    
    
    1Condensed Consolidated Statements of Operations  Three and Nine Months Ended September
30, 2009 and 2008
    
    
    2Condensed Consolidated Statement of Stockholders Equity and Other Comprehensive Income
(Loss)  Nine Months Ended September 30, 2009
    
    
    3Condensed Consolidated Statements of Cash Flows  Nine Months Ended September 30, 2009
and 2008
    
    
    4Notes to Condensed Consolidated Financial Statements
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    28Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    38Item 4. Controls and Procedures
    
    
    38PART II. OTHER INFORMATION:Item 1. Legal Proceedings
    
    
    39Item 1A. Risk Factors
    
    
    39Item 6. Exhibits
    
    
    39Signature
    
    
    40Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1  Financial Statements
 VWR FUNDING, INC. AND SUBSIDIARIES
 
 Condensed Consolidated Balance Sheets
(Dollars in millions, except share data)
(Unaudited)
 September 30,
    
    
    December 31,2009
    
    
    2008AssetsCurrent assets:Cash and cash equivalents
    
    $
    83.9
    
    
    $
    42.0Compensating cash balance
    
    
    114.8
    
    
    
    100.7Trade accounts receivable, less reserves of $11.2 and $10.1, respectively
    
    
    488.5
    
    
    
    472.2Other receivables
    
    
    28.6
    
    
    
    34.4Inventories
    
    
    267.0
    
    
    
    284.8Other current assets
    
    
    26.8
    
    
    
    29.8Total current assets
    
    
    1,009.6
    
    
    
    963.9Property and equipment, net
    
    
    190.4
    
    
    
    190.1Goodwill
    
    
    1,833.3
    
    
    
    1,784.7Other intangible assets, net
    
    
    2,010.8
    
    
    
    2,012.9Deferred income taxes
    
    
    12.6
    
    
    
    14.2Other assets
    
    
    81.9
    
    
    
    119.1Total assets
    
    $
    5,138.6
    
    
    $
    5,084.9Liabilities, Redeemable Equity Units and Stockholders EquityCurrent liabilities:Current portion of debt and capital lease obligations
    
    $
    156.3
    
    
    $
    165.0Accounts payable
    
    
    366.1
    
    
    
    356.5Accrued expenses
    
    
    171.0
    
    
    
    189.8Total current liabilities
    
    
    693.4
    
    
    
    711.3Long-term debt and capital lease obligations
    
    
    2,723.2
    
    
    
    2,650.6Other long-term liabilities
    
    
    131.6
    
    
    
    121.5Deferred income taxes
    
    
    499.2
    
    
    
    546.7Total liabilities
    
    
    4,047.4
    
    
    
    4,030.1Redeemable equity units
    
    
    44.5
    
    
    
    46.4Commitments and contingences (Note 11)Stockholders equity:Common stock, $0.01 par value; 1,000 shares authorized, issued and outstanding
    
    
    
    
    
    
    Additional paid-in capital
    
    
    1,361.8
    
    
    
    1,360.4Accumulated deficit
    
    
    (414.9
    )
    
    
    (383.6
    )Accumulated other comprehensive income
    
    
    99.8
    
    
    
    31.6Total stockholders equity
    
    
    1,046.7
    
    
    
    1,008.4Total liabilities, redeemable equity units and stockholders equity
    
    $
    5,138.6
    
    
    $
    5,084.9
   1




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VWR FUNDING, INC. AND SUBSIDIARIES
 
 Condensed Consolidated Statements of Operations
(Dollars in millions)
(Unaudited)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Net sales
    
    $
    902.1
    
    
    $
    979.9
    
    
    $
    2,619.3
    
    
    $
    2,868.0Cost of goods sold
    
    
    642.0
    
    
    
    701.1
    
    
    
    1,870.0
    
    
    
    2,056.4Gross profit
    
    
    260.1
    
    
    
    278.8
    
    
    
    749.3
    
    
    
    811.6Selling, general and administrative expenses
    
    
    197.1
    
    
    
    213.4
    
    
    
    599.9
    
    
    
    658.3Operating income
    
    
    63.0
    
    
    
    65.4
    
    
    
    149.4
    
    
    
    153.3Interest income
    
    
    0.5
    
    
    
    1.5
    
    
    
    1.8
    
    
    
    4.4Interest expense
    
    
    (59.6
    )
    
    
    (66.3
    )
    
    
    (173.6
    )
    
    
    (195.5
    )Other income (expense), net
    
    
    (30.0
    )
    
    
    96.5
    
    
    
    (39.4
    )
    
    
    23.3(Loss) income before income taxes
    
    
    (26.1
    )
    
    
    97.1
    
    
    
    (61.8
    )
    
    
    (14.5
    )Income tax benefit (provision)
    
    
    10.4
    
    
    
    (40.7
    )
    
    
    30.5
    
    
    
    4.4Net (loss) income
    
    $
    (15.7
    )
    
    $
    56.4
    
    
    $
    (31.3
    )
    
    $
    (10.1
    )
   2




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VWR FUNDING, INC. AND SUBSIDIARIES
 
 Condensed Consolidated Statement of Stockholders Equity and Other Comprehensive Income (Loss)
Nine Months Ended September 30, 2009
(Dollars in millions, except share data)
(Unaudited)
 AccumulatedAdditional
    
    
    
    
    
    
    otherCommon stock
    
    
    paid-in
    
    
    Accumulated
    
    
    comprehensiveShares
    
    
    Amount
    
    
    capital
    
    
    deficit
    
    
    income
    
    
    TotalBalance at January 1, 2009
    
    
    1,000
    
    
    $
    
    
    
    $
    1,360.4
    
    
    $
    (383.6
    )
    
    $
    31.6
    
    
    $
    1,008.4Capital contributions from parent
    
    
    
    
    
    
    
    
    
    
    0.7
    
    
    
    
    
    
    
    
    
    
    
    0.7Share-based compensation expense associated
with our parent company equity plan
    
    
    
    
    
    
    
    
    
    
    2.6
    
    
    
    
    
    
    
    
    
    
    
    2.6Reclassifications of redeemable equity units
    
    
    
    
    
    
    
    
    
    
    (1.9
    )
    
    
    
    
    
    
    
    
    
    
    (1.9
    )Comprehensive income (loss):Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (31.3
    )
    
    
    
    
    
    
    (31.3
    )Other comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    68.2
    
    
    
    68.2Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    36.9Balance at September 30, 2009
    
    
    1,000
    
    
    $
    
    
    
    $
    1,361.8
    
    
    $
    (414.9
    )
    
    $
    99.8
    
    
    $
    1,046.7
   3




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VWR FUNDING, INC. AND SUBSIDIARIES
 
 Condensed Consolidated Statements of Cash Flows
(Dollars in millions)
(Unaudited)
 Nine Months EndedSeptember 30,2009
    
    
    2008Cash flows from operating activities:Net loss
    
    $
    (31.3
    )
    
    $
    (10.1
    )Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:Depreciation and amortization
    
    
    87.1
    
    
    
    86.2Net unrealized translation loss (gain)
    
    
    41.2
    
    
    
    (27.2
    )Net unrealized loss on interest rate swaps
    
    
    4.7
    
    
    
    1.6Non-cash payment-in-kind interest accretion
    
    
    24.1
    
    
    
    Non-cash equity compensation expense
    
    
    2.6
    
    
    
    2.8Amortization of debt issuance costs
    
    
    7.2
    
    
    
    7.2Deferred income tax benefit
    
    
    (51.1
    )
    
    
    (35.5
    )Other, net
    
    
    5.7
    
    
    
    3.3Changes in working capital, net of business acquisitions:Trade accounts receivable
    
    
    (1.2
    )
    
    
    (49.4
    )Inventories
    
    
    26.3
    
    
    
    10.8Other current and non-current assets
    
    
    4.4
    
    
    
    9.2Accounts payable
    
    
    4.7
    
    
    
    (10.9
    )Accrued expenses and other liabilities
    
    
    (26.2
    )
    
    
    (11.4
    )Net cash provided by (used in) operating activities
    
    
    98.2
    
    
    
    (23.4
    )Cash flows from investing activities:Acquisitions of businesses and other intangible assets
    
    
    (1.2
    )
    
    
    (46.3
    )Capital expenditures
    
    
    (15.1
    )
    
    
    (24.3
    )Proceeds from sales of property and equipment
    
    
    1.4
    
    
    
    9.0Net cash used in investing activities
    
    
    (14.9
    )
    
    
    (61.6
    )Cash flows from financing activities:Proceeds from debt
    
    
    264.2
    
    
    
    335.8Repayment of debt
    
    
    (301.9
    )
    
    
    (263.6
    )Net change in bank overdrafts
    
    
    9.1
    
    
    
    8.8Net change in compensating cash balance
    
    
    (14.1
    )
    
    
    (11.6
    )Proceeds from equity and stock incentive plans
    
    
    0.6
    
    
    
    2.2Repurchase of redeemable equity units
    
    
    (3.6
    )
    
    
    Debt issuance costs
    
    
    
    
    
    
    (1.2
    )Net cash (used in) provided by financing activities
    
    
    (45.7
    )
    
    
    70.4Effect of exchange rate changes on cash
    
    
    4.3
    
    
    
    (0.5
    )Net increase (decrease) in cash and cash equivalents
    
    
    41.9
    
    
    
    (15.1
    )Cash and cash equivalents beginning of period
    
    
    42.0
    
    
    
    45.0Cash and cash equivalents end of period
    
    $
    83.9
    
    
    $
    29.9Supplemental disclosures of cash flow information:Cash paid during the period for:Interest
    
    $
    165.7
    
    
    $
    202.6Income taxes paid, net
    
    $
    21.0
    
    
    $
    20.8
   4




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VWR FUNDING, INC. AND SUBSIDIARIES
 
 Notes to Condensed Consolidated Financial Statements
September 30, 2009
(Dollars in millions)
(Unaudited)
 (1) Background, Nature of Operations and Basis of Presentation
      5




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
   (2) New Accounting Standards
 (a) Recently Adopted Accounting Standards
 Accounting Standards Codification
 The FASB Accounting Standards Codification and the Hierarchy of
Generally Accepted Accounting Principles
 Fair Value Measurements and Disclosures
 Fair Value Measurement and Disclosures
   6




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 Measuring Liabilities at Fair Value
 Derivatives & Hedging
 Derivatives & Hedging
 Business Combinations
 Business Combinations
 (b) Recently Issued Accounting Standards
 Defined Benefit Plans  Pension
 Investments in Certain Entities That
Calculate Net Asset Value per Share or Its Equivalent
  7




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 (3) Financial Instruments
  (a) Recurring Fair Value Measures
  SignificantQuoted Prices
    
    
    Other
    
    
    Significantin Active
    
    
    Observable
    
    
    UnobservableSeptember 30,
    
    
    Markets
    
    
    Inputs
    
    
    InputsDescription
    
    2009
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)AssetsForeign currency forward contracts
    
    $
    0.5
    
    
    $
    
    
    
    $
    0.5
    
    
    $
    LiabilitiesInterest rate swap arrangements
    
    $
    (54.6
    )
    
    $
    
    
    
    $
    (54.6
    )
    
    $
    
 SignificantQuoted Prices
    
    
    Other
    
    
    Significantin Active
    
    
    Observable
    
    
    UnobservableDecember 31,
    
    
    Markets
    
    
    Inputs
    
    
    InputsDescription
    
    2008
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)AssetsForeign currency forward contracts
    
    $
    5.1
    
    
    $
    
    
    
    $
    5.1
    
    
    $
    LiabilitiesInterest rate swap arrangements
    
    $
    (49.9
    )
    
    $
    
    
    
    $
    (49.9
    )
    
    $
    
 (b) Debt Instruments
  September 30,  2009
    
    
    December 31,  2008Carrying
    
    
    
    
    
    
    CarryingAmount
    
    
    Fair Value
    
    
    Amount
    
    
    Fair ValueSenior Secured Credit Facility
    
    $
    1,513.0
    
    
    $
    1,458.8
    
    
    $
    1,504.8
    
    
    $
    1,186.3Senior Notes
    
    
    691.0
    
    
    
    635.7
    
    
    
    675.0
    
    
    
    515.0Senior Subordinated Notes
    
    
    544.5
    
    
    
    462.8
    
    
    
    527.3
    
    
    
    377.6$
    2,748.5
    
    
    $
    2,557.3
    
    
    $
    2,707.1
    
    
    $
    2,078.9
  8




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
  (c) Derivative Instruments and Hedging Activities
 Interest Rate Swap Arrangements
   
     9




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
  
 Foreign Currency Forward Contracts
  
 Tabular Disclosures
  Asset Derivatives
    
    Liability DerivativesSeptember 30, 2009
    
    
    December 31, 2008
    
    September 30, 2009
    
    
    December 31, 2008Balance Sheet
    
    Fair
    
    
    Balance Sheet
    
    Fair
    
    Balance Sheet
    
    
    Fair
    
    
    Balance Sheet
    
    
    FairLocation
    
    Value
    
    
    Location
    
    Value
    

    Location
    
    
    Value
    
    
    Location
    
    
    ValueDerivatives designated as hedging instrumentsForeign currency forward contracts
    
    Other current assets
    
    $
    1.2
    
    
    Other current assets
    
    $
    5.3
    
    Other current assets
    
    $
    (0.7
    )
    
    Other current assets
    
    $
    (0.2
    )Derivatives not designated as hedging instrumentsInterest rate swap derivatives
    
    
    
    
    
    
    
    
    
    
    
    
    Other long-term liabilities
    
    
    (54.6
    )
    
    Other long-term liabilities
    
    
    (49.9
    )Total derivatives
    
    
    
    $
    1.2
    
    
    
    
    $
    5.3
    
    
    
    
    
    $
    (55.3
    )
    
    
    
    
    
    $
    (50.1
    )
  10




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
  Three Months Ended September 30, 2009Amount of Gain
    
    
    Location of Gain
    
    Amount of Gain(Loss) Recognized
    
    
    (Loss) Reclassified
    
    (Loss) Reclassifiedin Other
    
    
    from Other
    
    from OtherComprehensive
    
    
    Comprehensive Income
    
    ComprehensiveIncome
    
    
    into Earnings
    
    Income into Earnings(Effective Portion)
    
    
    (Effective Portion)
    
    (Effective Portion)Derivatives in cash flow hedging
relationshipsInterest rate swap derivatives
    
    $
    
    
    
    Interest expense
    
    $
    (1.1
    )Foreign currency forward contracts
    
    
    
    
    
    Interest expense
    
    
    (0.3
    )Foreign currency forward contracts
    
    
    0.2
    
    
    Cost of goods sold
    
    
    0.2Foreign currency forward contracts
    
    
    
    
    
    Other income (expense)
    
    
    0.1Total
    
    $
    0.2
    
    
    
    
    $
    (1.1
    )
 Location of Gain
    
    Amount of Gain(Loss) Recognized in
    
    (Loss) Recognized inEarnings
    
    EarningsDerivatives not designated as
hedging instrumentsInterest rate swap derivatives  realized
    
    Interest expense
    
    $
    (8.7
    )Interest rate swap derivatives  unrealized
    
    Interest expense
    
    $
    (2.4
    )
 Nine Months Ended September 30, 2009Amount of Gain
    
    
    Location of Gain
    
    Amount of Gain(Loss) Recognized
    
    
    (Loss) Reclassified
    
    (Loss) Reclassifiedin Other
    
    
    from Other
    
    from OtherComprehensive
    
    
    Comprehensive Income
    
    ComprehensiveIncome
    
    
    into Earnings
    
    Income into Earnings(Effective Portion)
    
    
    (Effective Portion)
    
    (Effective Portion)Derivatives in cash flow hedging
relationshipsInterest rate swap derivatives
    
    $
    
    
    
    Interest expense
    
    $
    (3.2
    )Foreign currency forward contracts
    
    
    
    
    
    Interest expense
    
    
    (0.9
    )Foreign currency forward contracts
    
    
    (2.2
    )
    
    Cost of goods sold
    
    
    1.8Foreign currency forward contracts
    
    
    
    
    
    Other income (expense)
    
    
    0.6Total
    
    $
    (2.2
    )
    
    
    
    $
    (1.7
    )
 Location of Gain
    
    Amount of Gain(Loss) Recognized in
    
    (Loss) Recognized inEarnings
    
    EarningsDerivatives not designated as
hedging instrumentsInterest rate swap derivatives  realized
    
    Interest expense
    
    $
    (23.3
    )Interest rate swap derivatives  unrealized
    
    Interest expense
    
    $
    (4.7
    )
   11




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 (4) Goodwill and Other
Intangible Assets
 (a) Impairments of Goodwill & Intangible
Assets
     (b) Goodwill
  North
    
    
    European
    
    
    ScienceAmerican Lab
    
    
    Lab
    
    
    Education
    
    
    TotalBalance at January 1, 2009
    
    $
    915.7
    
    
    $
    832.5
    
    
    $
    36.5
    
    
    $
    1,784.7Acquisition adjustments
    
    
    
    
    
    
    (3.3
    )
    
    
    
    
    
    
    (3.3
    )Currency translation
changes
    
    
    8.0
    
    
    
    43.9
    
    
    
    
    
    
    
    51.9Balance at September 30, 2009
    
    $
    923.7
    
    
    $
    873.1
    
    
    $
    36.5
    
    
    $
    1,833.3
  12




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 (c) Intangible Assets
  WeightedAverageAmortization
    
    
    September 30,
    
    
    December 31,Period (Years)
    
    
    2009
    
    
    2008Amortizable intangible assets:Customer relationships in North American Lab (net of
accumulated amortization of $84.2 and $55.5)
    
    
    20.0
    
    
    $
    665.2
    
    
    $
    685.4Customer relationships in European Lab (net of
accumulated amortization of $58.4 and $36.3)
    
    
    19.7
    
    
    
    456.7
    
    
    
    446.4Customer relationships in Science Education (net of
accumulated amortization of $14.8 and $9.8)
    
    
    20.0
    
    
    
    116.2
    
    
    
    121.2Chemical supply agreement (net of accumulated
amortization of $18.8 and $11.9)
    
    
    7.0
    
    
    
    39.7
    
    
    
    43.7Other (net of accumulated amortization of $7.1 and
$5.0)
    
    
    5.5
    
    
    
    11.8
    
    
    
    13.2Total amortizable intangible assets (net of accumulated
amortization of $183.3 and $118.5)
    
    
    19.4
    
    
    
    1,289.6
    
    
    
    1,309.9Indefinite-lived intangible assets:Trademarks and tradenames
    
    
    
    
    
    
    721.2
    
    
    
    703.0Total intangible assets, net
    
    
    
    
    
    $
    2,010.8
    
    
    $
    2,012.9
   Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Amortization expense
    
    $
    21.2
    
    
    $
    21.0
    
    
    $
    60.5
    
    
    $
    62.7
 (5) Debt
  September 30,
    
    
    December 31,2009
    
    
    2008Senior Secured Credit Facility
    
    $
    1,513.0
    
    
    $
    1,504.810.25%/11.25% Unsecured Senior Notes due 2015
    
    
    691.0
    
    
    
    675.010.75% Unsecured Senior Subordinated Notes due 2017
    
    
    544.5
    
    
    
    527.3Compensating cash balance
    
    
    114.8
    
    
    
    100.7Capital leases
    
    
    14.0
    
    
    
    5.6Other debt
    
    
    2.2
    
    
    
    2.2Total debt
    
    
    2,879.5
    
    
    
    2,815.6Less short-term portion
    
    
    (156.3
    )
    
    
    (165.0
    )Total long-term portion
    
    $
    2,723.2
    
    
    $
    2,650.6
  13




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 (a) Senior Secured Credit Facility
 
   (b) Senior Notes and Senior Subordinated Notes
   
  14




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##### Table of Contents



VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 (c) Covenant Compliance
    (d) Compensating Cash Balance
  (e) Other
  (6) Other Income (Expense), net
    15




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##### Table of Contents



VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 (7) Defined Benefit Plans
  Three Months Ended September 30,U.S. Retirement Plan
    
    
    German, French and UK Plans2009
    
    
    2008
    
    
    2009
    
    
    2008Service cost
    
    $
    
    
    
    $
    
    
    
    $
    0.5
    
    
    $
    0.7Interest cost
    
    
    2.4
    
    
    
    2.3
    
    
    
    1.5
    
    
    
    1.3Expected return on plan assets
    
    
    (3.0
    )
    
    
    (2.1
    )
    
    
    (0.9
    )
    
    
    (1.0
    )Recognized net actuarial gain
    
    
    (0.2
    )
    
    
    
    
    
    
    
    
    
    
    Net periodic pension (income) cost
    
    $
    (0.8
    )
    
    $
    0.2
    
    
    $
    1.1
    
    
    $
    1.0
 Nine Months Ended September 30,U.S. Retirement Plan
    
    
    German, French and UK Plans2009
    
    
    2008
    
    
    2009
    
    
    2008Service cost
    
    $
    0.4
    
    
    $
    1.2
    
    
    $
    1.4
    
    
    $
    2.3Interest cost
    
    
    6.9
    
    
    
    6.7
    
    
    
    4.0
    
    
    
    4.2Expected return on plan assets
    
    
    (8.6
    )
    
    
    (6.2
    )
    
    
    (2.3
    )
    
    
    (3.4
    )Recognized net actuarial gain
    
    
    (2.2
    )
    
    
    
    
    
    
    
    
    
    
    Net periodic
pension (income)
cost
    
    $
    (3.5
    )
    
    $
    1.7
    
    
    $
    3.1
    
    
    $
    3.1
   (8) Share-Based Compensation
  Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Share-based compensation expense
    
    $
    0.9
    
    
    $
    0.9
    
    
    $
    2.6
    
    
    $
    2.8
  16




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
  Balance at January 1, 2009
    
    $
    46.4Reclassifications from permanent equity, net
    
    
    1.9Reclassification to accrued expenses upon notification of redemption
    
    
    (3.8
    )Balance at September 30, 2009
    
    $
    44.5
  (9) Income Taxes
 (a) Effective Tax Rate
      (b) Uncertain Tax Positions
    17




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##### Table of Contents



VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 (10) Comprehensive Income (Loss)
  Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Net (loss) income
    
    $
    (15.7
    )
    
    $
    56.4
    
    
    
    (31.3
    )
    
    $
    (10.1
    )Other comprehensive income (loss):Foreign currency translation adjustments
    
    
    60.1
    
    
    
    (174.6
    )
    
    
    89.4
    
    
    
    (67.3
    )Minimum pension asset, net of taxes(1)
    
    
    (19.1
    )
    
    
    
    
    
    
    (19.1
    )
    
    
    Unrealized (loss) gain on derivatives, net of taxes(2)
    
    
    (0.1
    )
    
    
    (1.8
    )
    
    
    (3.2
    )
    
    
    4.8Amortization of realized losses on derivatives, net of
taxes(3)
    
    
    0.8
    
    
    
    1.2
    
    
    
    2.4
    
    
    
    1.7Amortization of net actuarial gain, net of taxes(4)
    
    
    (0.1
    )
    
    
    
    
    
    
    (1.3
    )
    
    
    Comprehensive income (loss)
    
    $
    25.9
    
    
    $
    (118.8
    )
    
    $
    36.9
    
    
    $
    (70.9
    )
 
 (1)
    
    Minimum pension asset is net of taxes of $12.2 for the three and nine months
ended September 30, 2009.(2)
    
    Unrealized (loss) gain on derivatives is net of taxes of $0.6 for the three
months ended September 30, 2008, and net of taxes of $1.4 and $(4.4) for the nine
months ended September 30, 2009 and 2008, respectively.(3)
    
    Amortization of realized
losses on derivatives is net of taxes of $(0.6) and
$(0.2) for the three months ended September 30, 2009 and 2008, respectively, and net of
taxes of $(1.7) and $(0.5) for the nine months ended September 30, 2009 and 2008,
respectively.(4)
    
    Amortization of net actuarial gain is net of taxes of $0.1 and $0.9 for the
three and nine months ended September 30, 2009, respectively. (11) Commitments and Contingencies
   18




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
     19




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##### Table of Contents



VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 (12) Segment Financial Information
   Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Net salesNorth American Lab
    
    $
    507.9
    
    
    $
    538.7
    
    
    $
    1,511.6
    
    
    $
    1,592.7European Lab
    
    
    344.9
    
    
    
    375.7
    
    
    
    1,002.2
    
    
    
    1,145.8Science Education
    
    
    49.3
    
    
    
    65.5
    
    
    
    105.5
    
    
    
    129.5Total
    
    $
    902.1
    
    
    $
    979.9
    
    
    $
    2,619.3
    
    
    $
    2,868.0
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Operating incomeNorth American Lab
    
    $
    32.4
    
    
    $
    31.9
    
    
    $
    86.1
    
    
    $
    82.0European Lab
    
    
    24.0
    
    
    
    23.7
    
    
    
    59.8
    
    
    
    63.5Science Education
    
    
    6.6
    
    
    
    9.8
    
    
    
    3.5
    
    
    
    7.8Total
    
    
    63.0
    
    
    
    65.4
    
    
    
    149.4
    
    
    
    153.3Interest income
    
    
    0.5
    
    
    
    1.5
    
    
    
    1.8
    
    
    
    4.4Interest expense
    
    
    (59.6
    )
    
    
    (66.3
    )
    
    
    (173.6
    )
    
    
    (195.5
    )Other income (expense), net
    
    
    (30.0
    )
    
    
    96.5
    
    
    
    (39.4
    )
    
    
    23.3(Loss) income before income taxes
    
    $
    (26.1
    )
    
    $
    97.1
    
    
    $
    (61.8
    )
    
    $
    (14.5
    )
 (13) Condensed Consolidating Financial Information
    20




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 Condensed Consolidating Balance Sheet
September 30, 2009
 Subsidiary
    
    
    Non-Guarantor
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    CompanyASSETSCurrent assets:Cash and cash equivalents
    
    $
    0.7
    
    
    $
    6.1
    
    
    $
    77.1
    
    
    $
    
    
    
    $
    83.9Compensating cash balance
    
    
    
    
    
    
    
    
    
    
    114.8
    
    
    
    
    
    
    
    114.8Trade accounts receivable, net
    
    
    
    
    
    
    209.7
    
    
    
    278.8
    
    
    
    
    
    
    
    488.5Inventories
    
    
    
    
    
    
    138.7
    
    
    
    128.3
    
    
    
    
    
    
    
    267.0Other current assets
    
    
    0.2
    
    
    
    16.5
    
    
    
    38.7
    
    
    
    
    
    
    
    55.4Intercompany receivables
    
    
    14.0
    
    
    
    3.8
    
    
    
    
    
    
    
    (17.8
    )
    
    
    Total current assets
    
    
    14.9
    
    
    
    374.8
    
    
    
    637.7
    
    
    
    (17.8
    )
    
    
    1,009.6Property and equipment, net
    
    
    
    
    
    
    73.2
    
    
    
    117.2
    
    
    
    
    
    
    
    190.4Goodwill
    
    
    
    
    
    
    900.3
    
    
    
    933.0
    
    
    
    
    
    
    
    1,833.3Other intangible assets, net
    
    
    
    
    
    
    1,135.9
    
    
    
    874.9
    
    
    
    
    
    
    
    2,010.8Deferred income taxes
    
    
    213.1
    
    
    
    
    
    
    
    12.6
    
    
    
    (213.1
    )
    
    
    12.6Investment in subsidiaries
    
    
    2,636.6
    
    
    
    1,763.0
    
    
    
    
    
    
    
    (4,399.6
    )
    
    
    Other assets
    
    
    43.8
    
    
    
    33.7
    
    
    
    4.4
    
    
    
    
    
    
    
    81.9Intercompany loans
    
    
    1,047.8
    
    
    
    98.9
    
    
    
    18.6
    
    
    
    (1,165.3
    )
    
    
    Total assets
    
    $
    3,956.2
    
    
    $
    4,379.8
    
    
    $
    2,598.4
    
    
    $
    (5,795.8
    )
    
    $
    5,138.6LIABILITIES, REDEEMABLE EQUITY
UNITS AND STOCKHOLDERS EQUITYCurrent liabilities:Current portion of debt and
capital lease obligations
    
    $
    38.1
    
    
    $
    0.4
    
    
    $
    117.8
    
    
    $
    
    
    
    $
    156.3Accounts payable
    
    
    
    
    
    
    193.1
    
    
    
    173.0
    
    
    
    
    
    
    
    366.1Accrued expenses
    
    
    4.9
    
    
    
    62.2
    
    
    
    103.9
    
    
    
    
    
    
    
    171.0Intercompany payables
    
    
    
    
    
    
    0.7
    
    
    
    17.1
    
    
    
    (17.8
    )
    
    
    Total current liabilities
    
    
    43.0
    
    
    
    256.4
    
    
    
    411.8
    
    
    
    (17.8
    )
    
    
    693.4Long-term debt and capital lease
obligations
    
    
    2,710.4
    
    
    
    1.7
    
    
    
    11.1
    
    
    
    
    
    
    
    2,723.2Other long-term liabilities
    
    
    55.1
    
    
    
    16.3
    
    
    
    60.2
    
    
    
    
    
    
    
    131.6Deferred income taxes
    
    
    
    
    
    
    430.7
    
    
    
    281.6
    
    
    
    (213.1
    )
    
    
    499.2Intercompany loans
    
    
    56.5
    
    
    
    1,038.9
    
    
    
    69.9
    
    
    
    (1,165.3
    )
    
    
    Total liabilities
    
    
    2,865.0
    
    
    
    1,744.0
    
    
    
    834.6
    
    
    
    (1,396.2
    )
    
    
    4,047.4Redeemable equity units
    
    
    44.5
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    44.5Total stockholders equity
    
    
    1,046.7
    
    
    
    2,635.8
    
    
    
    1,763.8
    
    
    
    (4,399.6
    )
    
    
    1,046.7Total liabilities, redeemable equity units
and stockholders equity
    
    $
    3,956.2
    
    
    $
    4,379.8
    
    
    $
    2,598.4
    
    
    $
    (5,795.8
    )
    
    $
    5,138.6
  21




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VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 Condensed Consolidating Balance Sheet
December 31, 2008
 Subsidiary
    
    
    Non-Guarantor
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    CompanyASSETSCurrent assets:Cash and cash equivalents
    
    $
    3.1
    
    
    $
    8.6
    
    
    $
    30.3
    
    
    $
    
    
    
    $
    42.0Compensating cash balance
    
    
    
    
    
    
    
    
    
    
    100.7
    
    
    
    
    
    
    
    100.7Trade accounts receivable, net
    
    
    
    
    
    
    196.5
    
    
    
    275.7
    
    
    
    
    
    
    
    472.2Inventories
    
    
    
    
    
    
    153.3
    
    
    
    131.5
    
    
    
    
    
    
    
    284.8Other current assets
    
    
    
    
    
    
    15.0
    
    
    
    49.2
    
    
    
    
    
    
    
    64.2Intercompany receivables
    
    
    11.2
    
    
    
    5.5
    
    
    
    
    
    
    
    (16.7
    )
    
    
    Total current assets
    
    
    14.3
    
    
    
    378.9
    
    
    
    587.4
    
    
    
    (16.7
    )
    
    
    963.9Property and equipment, net
    
    
    
    
    
    
    83.1
    
    
    
    107.0
    
    
    
    
    
    
    
    190.1Goodwill
    
    
    
    
    
    
    900.2
    
    
    
    884.5
    
    
    
    
    
    
    
    1,784.7Other intangible assets, net
    
    
    
    
    
    
    1,167.9
    
    
    
    845.0
    
    
    
    
    
    
    
    2,012.9Deferred income taxes
    
    
    150.4
    
    
    
    
    
    
    
    14.2
    
    
    
    (150.4
    )
    
    
    14.2Investment in subsidiaries
    
    
    2,630.4
    
    
    
    1,690.4
    
    
    
    
    
    
    
    (4,320.8
    )
    
    
    Other assets
    
    
    49.7
    
    
    
    64.2
    
    
    
    5.2
    
    
    
    
    
    
    
    119.1Intercompany loans
    
    
    1,004.9
    
    
    
    108.0
    
    
    
    51.0
    
    
    
    (1,163.9
    )
    
    
    Total assets
    
    $
    3,849.7
    
    
    $
    4,392.7
    
    
    $
    2,494.3
    
    
    $
    (5,651.8
    )
    
    $
    5,084.9LIABILITIES, REDEEMABLE EQUITY
UNITS AND STOCKHOLDERS EQUITYCurrent liabilities:Current portion of debt and
capital lease obligations
    
    $
    61.9
    
    
    $
    0.4
    
    
    $
    102.7
    
    
    $
    
    
    
    $
    165.0Accounts payable
    
    
    
    
    
    
    166.8
    
    
    
    189.7
    
    
    
    
    
    
    
    356.5Accrued expenses
    
    
    36.6
    
    
    
    62.5
    
    
    
    90.7
    
    
    
    
    
    
    
    189.8Intercompany payables
    
    
    1.0
    
    
    
    
    
    
    
    15.7
    
    
    
    (16.7
    )
    
    
    Total current liabilities
    
    
    99.5
    
    
    
    229.7
    
    
    
    398.8
    
    
    
    (16.7
    )
    
    
    711.3Long-term debt and capital lease
obligations
    
    
    2,645.2
    
    
    
    1.9
    
    
    
    3.5
    
    
    
    
    
    
    
    2,650.6Other long-term liabilities
    
    
    50.2
    
    
    
    15.7
    
    
    
    55.6
    
    
    
    
    
    
    
    121.5Deferred income taxes
    
    
    
    
    
    
    426.9
    
    
    
    270.2
    
    
    
    (150.4
    )
    
    
    546.7Intercompany loans
    
    
    
    
    
    
    1,088.9
    
    
    
    75.0
    
    
    
    (1,163.9
    )
    
    
    Total liabilities
    
    
    2,794.9
    
    
    
    1,763.1
    
    
    
    803.1
    
    
    
    (1,331.0
    )
    
    
    4,030.1Redeemable equity units
    
    
    46.4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    46.4Total stockholders equity
    
    
    1,008.4
    
    
    
    2,629.6
    
    
    
    1,691.2
    
    
    
    (4,320.8
    )
    
    
    1,008.4Total liabilities, redeemable equity units
and stockholders equity
    
    $
    3,849.7
    
    
    $
    4,392.7
    
    
    $
    2,494.3
    
    
    $
    (5,651.8
    )
    
    $
    5,084.9
  22




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##### Table of Contents



VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 Condensed Consolidating Statement of Operations
Three Months Ended September 30, 2009
 Subsidiary
    
    
    Non-Guarantor
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    CompanyNet sales
    
    $
    
    
    
    $
    488.3
    
    
    $
    417.6
    
    
    $
    (3.8
    )
    
    $
    902.1Cost of goods sold
    
    
    
    
    
    
    360.3
    
    
    
    285.5
    
    
    
    (3.8
    )
    
    
    642.0Gross profit
    
    
    
    
    
    
    128.0
    
    
    
    132.1
    
    
    
    
    
    
    
    260.1Selling, general and administrative expenses
    
    
    0.8
    
    
    
    93.9
    
    
    
    107.5
    
    
    
    (5.1
    )
    
    
    197.1Operating (loss) income
    
    
    (0.8
    )
    
    
    34.1
    
    
    
    24.6
    
    
    
    5.1
    
    
    
    63.0Interest expense, net of interest income
    
    
    (48.6
    )
    
    
    (9.5
    )
    
    
    (1.0
    )
    
    
    
    
    
    
    (59.1
    )Other income (expense), net
    
    
    (31.5
    )
    
    
    1.1
    
    
    
    5.5
    
    
    
    (5.1
    )
    
    
    (30.0
    )(Loss) income before income taxes and
equity in earnings of subsidiaries
    
    
    (80.9
    )
    
    
    25.7
    
    
    
    29.1
    
    
    
    
    
    
    
    (26.1
    )Income tax benefit (provision)
    
    
    29.8
    
    
    
    (10.3
    )
    
    
    (9.1
    )
    
    
    
    
    
    
    10.4Equity in earnings of subsidiaries, net of tax
    
    
    35.4
    
    
    
    20.0
    
    
    
    
    
    
    
    (55.4
    )
    
    
    Net (loss) income
    
    $
    (15.7
    )
    
    $
    35.4
    
    
    $
    20.0
    
    
    $
    (55.4
    )
    
    $
    (15.7
    )
 Condensed Consolidating Statement of Operations
Three Months Ended September 30, 2008
 Subsidiary
    
    
    Non-Guarantor
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    CompanyNet sales
    
    $
    
    
    
    $
    535.7
    
    
    $
    448.8
    
    
    $
    (4.6
    )
    
    $
    979.9Cost of goods sold
    
    
    
    
    
    
    395.7
    
    
    
    310.0
    
    
    
    (4.6
    )
    
    
    701.1Gross profit
    
    
    
    
    
    
    140.0
    
    
    
    138.8
    
    
    
    
    
    
    
    278.8Selling, general and administrative expenses
    
    
    0.9
    
    
    
    102.5
    
    
    
    115.9
    
    
    
    (5.9
    )
    
    
    213.4Operating (loss) income
    
    
    (0.9
    )
    
    
    37.5
    
    
    
    22.9
    
    
    
    5.9
    
    
    
    65.4Interest expense, net of interest income
    
    
    (46.8
    )
    
    
    (15.7
    )
    
    
    (2.3
    )
    
    
    
    
    
    
    (64.8
    )Other income (expense), net
    
    
    103.7
    
    
    
    22.6
    
    
    
    (23.9
    )
    
    
    (5.9
    )
    
    
    96.5Income (loss) before income taxes and
equity in earnings of subsidiaries
    
    
    56.0
    
    
    
    44.4
    
    
    
    (3.3
    )
    
    
    
    
    
    
    97.1Income tax provision
    
    
    (21.8
    )
    
    
    (18.9
    )
    
    
    
    
    
    
    
    
    
    
    (40.7
    )Equity in earnings of subsidiaries, net of tax
    
    
    22.2
    
    
    
    (3.3
    )
    
    
    
    
    
    
    (18.9
    )
    
    
    Net income (loss)
    
    $
    56.4
    
    
    $
    22.2
    
    
    $
    (3.3
    )
    
    $
    (18.9
    )
    
    $
    56.4
  23




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##### Table of Contents



VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 Condensed Consolidating Statement of Operations
Nine Months Ended September 30, 2009
 Subsidiary
    
    
    Non-Guarantor
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    CompanyNet sales
    
    $
    
    
    
    $
    1,417.6
    
    
    $
    1,212.2
    
    
    $
    (10.5
    )
    
    $
    2,619.3Cost of goods sold
    
    
    
    
    
    
    1,054.9
    
    
    
    825.6
    
    
    
    (10.5
    )
    
    
    1,870.0Gross profit
    
    
    
    
    
    
    362.7
    
    
    
    386.6
    
    
    
    
    
    
    
    749.3Selling, general and administrative expenses
    
    
    2.4
    
    
    
    285.2
    
    
    
    329.6
    
    
    
    (17.3
    )
    
    
    599.9Operating (loss) income
    
    
    (2.4
    )
    
    
    77.5
    
    
    
    57.0
    
    
    
    17.3
    
    
    
    149.4Interest expense, net of interest income
    
    
    (136.8
    )
    
    
    (32.0
    )
    
    
    (3.0
    )
    
    
    
    
    
    
    (171.8
    )Other income (expense), net
    
    
    (44.4
    )
    
    
    11.8
    
    
    
    10.5
    
    
    
    (17.3
    )
    
    
    (39.4
    )(Loss) income before income taxes and
equity in earnings of subsidiaries
    
    
    (183.6
    )
    
    
    57.3
    
    
    
    64.5
    
    
    
    
    
    
    
    (61.8
    )Income tax benefit (provision)
    
    
    72.3
    
    
    
    (23.2
    )
    
    
    (18.6
    )
    
    
    
    
    
    
    30.5Equity in earnings of subsidiaries, net of tax
    
    
    80.0
    
    
    
    45.9
    
    
    
    
    
    
    
    (125.9
    )
    
    
    Net (loss) income
    
    $
    (31.3
    )
    
    $
    80.0
    
    
    $
    45.9
    
    
    $
    (125.9
    )
    
    $
    (31.3
    )
 Condensed Consolidating Statement of Operations
Nine Months Ended September 30, 2008
 Subsidiary
    
    
    Non-Guarantor
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    CompanyNet sales
    
    $
    
    
    
    $
    1,510.4
    
    
    $
    1,375.8
    
    
    $
    (18.2
    )
    
    $
    2,868.0Cost of goods sold
    
    
    
    
    
    
    1,124.0
    
    
    
    950.6
    
    
    
    (18.2
    )
    
    
    2,056.4Gross profit
    
    
    
    
    
    
    386.4
    
    
    
    425.2
    
    
    
    
    
    
    
    811.6Selling, general and administrative expenses
    
    
    2.4
    
    
    
    309.9
    
    
    
    362.0
    
    
    
    (16.0
    )
    
    
    658.3Operating (loss) income
    
    
    (2.4
    )
    
    
    76.5
    
    
    
    63.2
    
    
    
    16.0
    
    
    
    153.3Interest expense, net of interest income
    
    
    (136.2
    )
    
    
    (50.2
    )
    
    
    (4.7
    )
    
    
    
    
    
    
    (191.1
    )Other income (expense), net
    
    
    31.7
    
    
    
    20.3
    
    
    
    (12.7
    )
    
    
    (16.0
    )
    
    
    23.3(Loss) income before income taxes and
equity in earnings of subsidiaries
    
    
    (106.9
    )
    
    
    46.6
    
    
    
    45.8
    
    
    
    
    
    
    
    (14.5
    )Income tax benefit (provision)
    
    
    40.7
    
    
    
    (19.9
    )
    
    
    (16.4
    )
    
    
    
    
    
    
    4.4Equity in earnings of subsidiaries, net of tax
    
    
    56.1
    
    
    
    29.4
    
    
    
    
    
    
    
    (85.5
    )
    
    
    Net (loss) income
    
    $
    (10.1
    )
    
    $
    56.1
    
    
    $
    29.4
    
    
    $
    (85.5
    )
    
    $
    (10.1
    )
  24




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##### Table of Contents



VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 Condensed Consolidating Statement of Cash Flows
Nine Months Ended September 30, 2009
 Subsidiary
    
    
    Non-Guarantor
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    CompanyNet cash (used in) provided by operating activities
    
    $
    (127.7
    )
    
    $
    144.1
    
    
    $
    81.8
    
    
    $
    
    
    
    $
    98.2Cash flows from investing activities:Intercompany investing transactions
    
    
    165.5
    
    
    
    31.3
    
    
    
    
    
    
    
    (196.8
    )
    
    
    Capital expenditures
    
    
    
    
    
    
    (7.2
    )
    
    
    (7.9
    )
    
    
    
    
    
    
    (15.1
    )Other investing activities, net
    
    
    
    
    
    
    
    
    
    
    0.2
    
    
    
    
    
    
    
    0.2Net cash provided by (used in) investing activities
    
    
    165.5
    
    
    
    24.1
    
    
    
    (7.7
    )
    
    
    (196.8
    )
    
    
    (14.9
    )Cash flows from financing activities:Intercompany financing transactions
    
    
    
    
    
    
    (165.5
    )
    
    
    (31.3
    )
    
    
    196.8
    
    
    
    Proceeds from debt
    
    
    263.1
    
    
    
    
    
    
    
    1.1
    
    
    
    
    
    
    
    264.2Repayment of debt
    
    
    (300.3
    )
    
    
    (0.2
    )
    
    
    (1.4
    )
    
    
    
    
    
    
    (301.9
    )Other financing activities, net
    
    
    (3.0
    )
    
    
    (5.0
    )
    
    
    
    
    
    
    
    
    
    
    (8.0
    )Net cash used in financing activities
    
    
    (40.2
    )
    
    
    (170.7
    )
    
    
    (31.6
    )
    
    
    196.8
    
    
    
    (45.7
    )Effect of exchange rate changes on cash
    
    
    
    
    
    
    
    
    
    
    4.3
    
    
    
    
    
    
    
    4.3Net (decrease) increase in cash and cash
equivalents
    
    
    (2.4
    )
    
    
    (2.5
    )
    
    
    46.8
    
    
    
    
    
    
    
    41.9Cash and cash equivalents beginning of period
    
    
    3.1
    
    
    
    8.6
    
    
    
    30.3
    
    
    
    
    
    
    
    42.0Cash and cash equivalents end of period
    
    $
    0.7
    
    
    $
    6.1
    
    
    $
    77.1
    
    
    $
    
    
    
    $
    83.9
  25




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##### Table of Contents



VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 Condensed Consolidating Statement of Cash Flows
Nine Months Ended September 30, 2008
 Subsidiary
    
    
    Non-Guarantor
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    CompanyNet cash (used in) provided by operating activities
    
    $
    (144.7
    )
    
    $
    74.7
    
    
    $
    46.6
    
    
    $
    
    
    
    $
    (23.4
    )Cash flows from investing activities:Intercompany investing transactions
    
    
    72.9
    
    
    
    (19.5
    )
    
    
    
    
    
    
    (53.4
    )
    
    
    Acquisitions of other businesses and transaction costs
    
    
    
    
    
    
    
    
    
    
    (46.3
    )
    
    
    
    
    
    
    (46.3
    )Capital expenditures
    
    
    
    
    
    
    (15.1
    )
    
    
    (9.2
    )
    
    
    
    
    
    
    (24.3
    )Proceeds from sales of property and equipment
    
    
    
    
    
    
    0.3
    
    
    
    8.7
    
    
    
    
    
    
    
    9.0Net cash provided by (used in) investing activities
    
    
    72.9
    
    
    
    (34.3
    )
    
    
    (46.8
    )
    
    
    (53.4
    )
    
    
    (61.6
    )Cash flows from financing activities:Intercompany financing transactions
    
    
    
    
    
    
    (72.9
    )
    
    
    19.5
    
    
    
    53.4
    
    
    
    Proceeds from debt
    
    
    335.1
    
    
    
    
    
    
    
    0.7
    
    
    
    
    
    
    
    335.8Repayment of debt
    
    
    (262.1
    )
    
    
    (0.1
    )
    
    
    (1.4
    )
    
    
    
    
    
    
    (263.6
    )Other financing activities, net
    
    
    1.0
    
    
    
    19.7
    
    
    
    (22.5
    )
    
    
    
    
    
    
    (1.8
    )Net cash provided by (used in) financing activities
    
    
    74.0
    
    
    
    (53.3
    )
    
    
    (3.7
    )
    
    
    53.4
    
    
    
    70.4Effect of exchange rate changes on cash
    
    
    
    
    
    
    
    
    
    
    (0.5
    )
    
    
    
    
    
    
    (0.5
    )Net increase (decrease) in cash and cash
equivalents
    
    
    2.2
    
    
    
    (12.9
    )
    
    
    (4.4
    )
    
    
    
    
    
    
    (15.1
    )Cash and cash equivalents beginning of period
    
    
    1.1
    
    
    
    16.1
    
    
    
    27.8
    
    
    
    
    
    
    
    45.0Cash and cash equivalents end of period
    
    $
    3.3
    
    
    $
    3.2
    
    
    $
    23.4
    
    
    $
    
    
    
    $
    29.9
  26




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##### Table of Contents



VWR FUNDING, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
September 30, 2009
(Dollars in millions)
(Unaudited)
 (14) Subsequent Events
    27




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##### Table of Contents



Item 2  Managements Discussion and Analysis of Financial Condition and Results of Operations
 Forward-Looking Statements
 Cautionary Factors Regarding Forward-Looking Statements
   
    
    actions by, and our ability to maintain existing business relationships and practices with,
suppliers, customers, carriers and other third parties:
 
    
    loss of our key executive officers;
 
    
    our ability to consummate and integrate potential acquisitions;
 
    
    the effect of political, economic and credit and financial market conditions, inflation and
interest rates worldwide;
 
    
    the effect of changes in laws and regulations, including changes in accounting standards,
trade, tax, price controls and other regulatory matters;
 
    
    increased competition from other companies in our industry and our ability to retain or
increase our market share in the principal geographical areas in which we operate;
 
    
    foreign currency exchange rate fluctuations; and
 
    
    our ability to generate sufficient funds to meet our debt obligations, capital expenditure
program requirements, ongoing operating costs, acquisition financing and working capital
needs.
    28




---



##### Table of Contents



Overview
  
    
    A significant portion of the purchase price was allocated to goodwill and amortizable
and indefinite-lived intangible assets. Accordingly, non-cash charges for depreciation and
amortization have increased subsequent to the Merger. In addition and as further discussed
below and in our Annual Report on Form 10-K for the year ended December 31, 2008, our
results of operations subsequent to the Merger have been materially impacted due to our
recognition of non-cash impairment charges related to goodwill and intangible assets. We
believe that the impairment charges recognized in our North American Lab and European Lab
segments were primarily a result of changes in macroeconomic factors since the Merger,
while the impairment charges recognized in our Science Education segment were due to a mix
of macroeconomic changes and industry-specific factors.
 
    
    Immediately after the Merger, we had approximately $2.7 billion of outstanding
indebtedness, compared to approximately $1.7 billion prior to the Merger. Accordingly, we
are a highly leveraged company and related interest expense has increased.
 
    
    As a result of the change in our capital structure related to the Merger, we have a
significant amount of foreign-denominated debt on our U.S. dollar-denominated balance
sheet. The translation of foreign-denominated debt obligations on our U.S.
dollar-denominated balance sheet is recorded in other income (expense), net as a foreign
currency exchange gain or loss each period. As a result, this exposes our operating
results to risk based on fluctuations in foreign currency exchange rates, principally with
respect to the Euro.
      29




---



##### Table of Contents




    
    a reduction in spending by customers across virtually all industry segments we serve
in our laboratory businesses due, in part, to a further and/or prolonged deterioration in
economic conditions and liquidity pressures;
 
    
    rising product prices from our suppliers; and
 
    
    the acceleration of payment terms to our suppliers and/or the imposition of more
restrictive credit terms and other contractual requirements.
    Factors Affecting Our Operating Results
 Foreign Currency
    30




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##### Table of Contents



Acquisitions
  Product / Service
    
    
    
    BusinessAcquisition Date
    
    Entity Name
    
    Offering
    
    Location
    
    SegmentOctober 1, 2008
    
    Omnilab AG (Omnilab AG)
    
    Laboratory supply
    
    Switzerland
    
    European LabAugust 1, 2008
    
    Spektrum-3D Kft (Spektrum)
    
    Laboratory supply
    
    Hungary
    
    European LabApril 1, 2008
    
    Jencons (Scientific)
Limited (Jencons)
    
    Laboratory supply
    
    United Kingdom
    
    European Lab
  Results of Operations
 Net Sales
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,Change
    
    
    
    
    
    
    
    
    
    
    Change2009
    
    
    2008
    
    
    Amount
    
    
    %
    
    
    2009
    
    
    2008
    
    
    Amount
    
    
    %North American Lab
    
    $
    507.9
    
    
    $
    538.7
    
    
    $
    (30.8
    )
    
    
    (5.7
    )%
    
    $
    1,511.6
    
    
    $
    1,592.7
    
    
    $
    (81.1
    )
    
    
    (5.1
    )%European Lab
    
    
    344.9
    
    
    
    375.7
    
    
    
    (30.8
    )
    
    
    (8.2
    )%
    
    
    1,002.2
    
    
    
    1,145.8
    
    
    
    (143.6
    )
    
    
    (12.5
    )%Science Education
    
    
    49.3
    
    
    
    65.5
    
    
    
    (16.2
    )
    
    
    (24.7
    )%
    
    
    105.5
    
    
    
    129.5
    
    
    
    (24.0
    )
    
    
    (18.5
    )%Total
    
    $
    902.1
    
    
    $
    979.9
    
    
    $
    (77.8
    )
    
    
    (7.9
    )%
    
    $
    2,619.3
    
    
    $
    2,868.0
    
    
    $
    (248.7
    )
    
    
    (8.7
    )%
      31




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##### Table of Contents



Gross Profit
  Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Gross profit
    
    $
    260.1
    
    
    $
    278.8
    
    
    $
    749.3
    
    
    $
    811.6Percentage of net sales (gross margin)
    
    
    28.8
    %
    
    
    28.5
    %
    
    
    28.6
    %
    
    
    28.3
    %
   Selling, General, and Administrative Expenses
  Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Selling, general and administrative expenses
    
    $
    197.1
    
    
    $
    213.4
    
    
    $
    599.9
    
    
    $
    658.3Percentage of net sales
    
    
    21.8
    %
    
    
    21.8
    %
    
    
    22.9
    %
    
    
    23.0
    %
   32




---



##### Table of Contents



Operating Income
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of2009
    
    
    Net Sales
    
    
    2008
    
    
    Net Sales
    
    
    2009
    
    
    Net Sales
    
    
    2008
    
    
    Net SalesOperating income:North American Lab
    
    $
    32.4
    
    
    
    6.4
    %
    
    $
    31.9
    
    
    
    5.9
    %
    
    $
    86.1
    
    
    
    5.7
    %
    
    $
    82.0
    
    
    
    5.1
    %European Lab
    
    
    24.0
    
    
    
    7.0
    %
    
    
    23.7
    
    
    
    6.3
    %
    
    
    59.8
    
    
    
    6.0
    %
    
    
    63.5
    
    
    
    5.5
    %Science Education
    
    
    6.6
    
    
    
    13.4
    %
    
    
    9.8
    
    
    
    15.0
    %
    
    
    3.5
    
    
    
    3.3
    %
    
    
    7.8
    
    
    
    6.0
    %Total
    
    $
    63.0
    
    
    
    7.0
    %
    
    $
    65.4
    
    
    
    6.7
    %
    
    $
    149.4
    
    
    
    5.7
    %
    
    $
    153.3
    
    
    
    5.3
    %
     33




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##### Table of Contents



Interest Expense, Net of Interest Income
  Other Income (Expense), Net
  Income Taxes
        34




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##### Table of Contents



Liquidity and Capital Resources
     
    35




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##### Table of Contents



Historical Cash Flows
  Nine Months EndedSeptember 30,2009
    
    
    2008Cash flow from operations, excluding working capital
    
    $
    90.2
    
    
    $
    28.3Cash flow from working capital changes, net
    
    
    8.0
    
    
    
    (51.7
    )Cash flow from operations
    
    $
    98.2
    
    
    $
    (23.4
    )
     36




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##### Table of Contents



Contractual Obligations
 Item 7  Form 10-K
 Commitments and Contingencies
  Off-Balance Sheet Arrangements
  Critical Accounting Policies
    New Accounting Standards
   37




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##### Table of Contents



Item 3  Quantitative and Qualitative Disclosures about Market Risk
  
 Item 4  Controls and Procedures
     38




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##### Table of Contents



Part II  OTHER INFORMATION
 
 Item 1  Legal Proceedings
  
 Item 1A  Risk Factors
  
 Item 6  Exhibits
 ExhibitNumber
    
    Description of Documents
    
    Method of Filing31.1
    
    
    Certification of Principal Executive Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
    
    Filed herewith.31.2
    
    
    Certification of Principal Financial Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
    
    Filed herewith.32.1
    
    
    Certification of Principal Executive Officer pursuant to
18 U.S.C. 1350 (Section 906 of the Sarbanes-Oxley Act of
2002).
    
    Furnished herewith.32.2
    
    
    Certification of Principal Financial Officer pursuant to
18 U.S.C. 1350 (Section 906 of the Sarbanes-Oxley Act of
2002).
    
    Furnished herewith.
  39




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##### Table of Contents



SIGNATURE
  VWR FUNDING, INC.By:
    /s/ Theresa A. BalogName:
    Theresa A. BalogTitle:
    Vice President and Controller
(Chief Accounting Officer and
Duly Authorized Officer)   40




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description of Documents
    
    Method of Filing31.1
    
    
    Certification of Principal Executive Officer pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.
    
    Filed herewith.31.2
    
    
    Certification of Principal Financial Officer pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.
    
    Filed herewith.32.1
    
    
    Certification of Principal Executive Officer pursuant to 18 U.S.C.
1350 (Section 906 of the Sarbanes-Oxley Act of 2002).
    
    Furnished herewith.32.2
    
    
    Certification of Principal Financial Officer pursuant to 18 U.S.C. 1350
(Section 906 of the Sarbanes-Oxley Act of 2002).
    
    Furnished herewith.
  41