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SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 FORM 10-Q/A
 
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended December 31, 2004
 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 333-64641
 
 PHIBRO ANIMAL HEALTH CORPORATION
 (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
 New York
(STATE OR OTHER JURISDICTION
OF INCORPORATION OR ORGANIZATION)
    
    13-1840497
(I.R.S. EMPLOYER
IDENTIFICATION NO.)
 
 
 
  þ o
  o o þ
 o þ




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##### 



PAGEPART I FINANCIAL INFORMATION (Unaudited)Item 1. Condensed Consolidated Financial Statements
    
    
    3Condensed Consolidated Balance Sheets
    
    
    4Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)
    
    
    5Condensed Consolidated Statements of Changes in Stockholders Deficit
    
    
    6Condensed Consolidated Statements of Cash Flows
    
    
    7Notes to Condensed Consolidated Financial Statements
    
    
    8Item 2. Managements Discussion and Analysis of Financial
Condition and Results of Operations
    
    
    29Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    40Item 4. Controls and Procedures
    
    
    40PART II OTHER INFORMATIONItem 5. Other Information
    
    
    42Item 6. Exhibits
    
    
    42SIGNATURES
    
    
    43EX-10.33: PURCHASE AGREEMENTEX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-31.3: CERTIFICATIONEX-32: CERTIFICATION
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DECEMBER 31,
    
    
    JUNE 30,2004
    
    
    2004ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    10,170
    
    
    $
    5,568Trade receivables, less allowance for doubtful accounts
of $1,307 at December 31, 2004 and $1,358 at June 30, 2004
    
    
    56,875
    
    
    
    57,658Other receivables
    
    
    4,470
    
    
    
    2,766Inventories
    
    
    97,604
    
    
    
    79,910Prepaid expenses and other current assets
    
    
    6,914
    
    
    
    8,688TOTAL CURRENT ASSETS
    
    
    176,033
    
    
    
    154,590PROPERTY, PLANT AND EQUIPMENT, net
    
    
    61,111
    
    
    
    58,786INTANGIBLES
    
    
    11,116
    
    
    
    11,695OTHER ASSETS
    
    
    16,790
    
    
    
    16,298$
    265,050
    
    
    $
    241,369LIABILITIES AND STOCKHOLDERS DEFICITCURRENT LIABILITIES:Cash overdraft
    
    $
    1,787
    
    
    $
    891Loans payable to banks
    
    
    297
    
    
    
    10,996Current portion of long-term debt
    
    
    4,082
    
    
    
    1,351Accounts payable
    
    
    46,368
    
    
    
    46,972Accrued expenses and other current liabilities
    
    
    47,809
    
    
    
    40,010TOTAL CURRENT LIABILITIES
    
    
    100,343
    
    
    
    100,220LONG-TERM DEBT
    
    
    178,630
    
    
    
    158,018OTHER LIABILITIES
    
    
    23,340
    
    
    
    22,286TOTAL LIABILITIES
    
    
    302,313
    
    
    
    280,524COMMITMENTS AND CONTINGENCIES
REDEEMABLE SECURITIES:Series C preferred stock
    
    
    22,817
    
    
    
    24,678STOCKHOLDERS DEFICIT:Series A preferred stock
    
    
    521
    
    
    
    521Common stock
    
    
    2
    
    
    
    2Paid-in capital
    
    
    860
    
    
    
    860Accumulated deficit
    
    
    (62,844
    )
    
    
    (57,964
    )Accumulated other comprehensive income (loss):Gain on derivative instruments
    
    
    331
    
    
    
    9Cumulative currency translation adjustment
    
    
    1,050
    
    
    
    (7,261
    )TOTAL STOCKHOLDERS DEFICIT
    
    
    (60,080
    )
    
    
    (63,833
    )$
    265,050
    
    
    $
    241,369
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THREE MONTHS ENDED
    
    
    SIX MONTHS ENDEDDECEMBER 31,
    
    
    DECEMBER 31,2004
    
    
    2003
    
    
    2004
    
    
    2003NET SALES
    
    $
    93,060
    
    
    $
    92,540
    
    
    $
    181,335
    
    
    $
    177,490COST OF GOODS SOLD (includes Belgium Plant
Transactions costs of $9,536 for the
three months and six months ended
December 31, 2004)
    
    
    79,191
    
    
    
    69,991
    
    
    
    144,844
    
    
    
    133,781GROSS PROFIT
    
    
    13,869
    
    
    
    22,549
    
    
    
    36,491
    
    
    
    43,709SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES
    
    
    17,759
    
    
    
    16,824
    
    
    
    34,353
    
    
    
    32,609OPERATING INCOME (LOSS)
    
    
    (3,890
    )
    
    
    5,725
    
    
    
    2,138
    
    
    
    11,100OTHER:Interest expense
    
    
    5,389
    
    
    
    4,549
    
    
    
    10,635
    
    
    
    8,482Interest (income)
    
    
    (33
    )
    
    
    168
    
    
    
    (58
    )
    
    
    (74
    )Other (income) expense, net
    
    
    (791
    )
    
    
    127
    
    
    
    (767
    )
    
    
    (458
    )Net (gain) on extinguishment of debt
    
    
    
    
    
    
    (23,226
    )
    
    
    
    
    
    
    (23,226
    )INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE INCOME TAXES
    
    
    (8,455
    )
    
    
    24,107
    
    
    
    (7,672
    )
    
    
    26,376PROVISION (BENEFIT) FOR INCOME TAXES
    
    
    (884
    )
    
    
    2,880
    
    
    
    40
    
    
    
    3,663INCOME (LOSS) FROM CONTINUING OPERATIONS
    
    
    (7,571
    )
    
    
    21,227
    
    
    
    (7,712
    )
    
    
    22,713DISCONTINUED OPERATIONS:Gain (loss) from discontinued operations (net of
income taxes)
    
    
    
    
    
    
    59
    
    
    
    
    
    
    
    (403
    )Gain on disposal of discontinued operations
(net of income taxes)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    231NET INCOME (LOSS)
    
    
    (7,571
    )
    
    
    21,286
    
    
    
    (7,712
    )
    
    
    22,541OTHER COMPREHENSIVE INCOME:Change in derivative instruments, net of tax
    
    
    247
    
    
    
    102
    
    
    
    322
    
    
    
    419Change in currency translation adjustment
    
    
    5,304
    
    
    
    3,031
    
    
    
    8,311
    
    
    
    2,172COMPREHENSIVE INCOME (LOSS)
    
    $
    (2,020
    )
    
    $
    24,419
    
    
    $
    921
    
    
    $
    25,132NET INCOME (LOSS)
    
    
    (7,571
    )
    
    
    21,286
    
    
    
    (7,712
    )
    
    
    22,541Excess of the reduction of redeemable preferred stock
over total assets divested and costs and liabilities
incurred on the Prince Transactions
    
    
    973
    
    
    
    20,138
    
    
    
    973
    
    
    
    20,138Dividends and equity value accreted on Series B and C
redeemable preferred stock
    
    
    2,541
    
    
    
    (2,864
    )
    
    
    1,859
    
    
    
    (3,851
    )NET INCOME (LOSS) AVAILABLE TO
COMMON SHAREHOLDERS
    
    $
    (4,057
    )
    
    $
    38,560
    
    
    $
    (4,880
    )
    
    $
    38,828
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ACCUMULATEDPREFERRED
    
    
    COMMON
    
    
    
    
    
    
    
    
    
    
    OTHERSTOCK
    
    
    STOCK
    
    
    PAID-IN
    
    
    ACCUMULATED
    
    
    COMPREHENSIVESERIES A
    
    
    CLASS A
    
    
    CLASS B
    
    
    CAPITAL
    
    
    DEFICIT
    
    
    INCOME (LOSS)
    
    
    TOTALBalance, June 30, 2004
    
    $
    521
    
    
    $
    1
    
    
    $
    1
    
    
    $
    860
    
    
    $
    (57,964
    )
    
    $
    (7,252
    )
    
    $
    (63,833
    )Dividends on Series C
redeemable preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (668
    )
    
    
    
    
    
    
    (668
    )Equity value accreted on
Series C redeemable
preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (14
    )
    
    
    
    
    
    
    (14
    )Change in derivative
instruments, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    75
    
    
    
    75Foreign currency translation
adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,007
    
    
    
    3,007Net (loss)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (141
    )
    
    
    
    
    
    
    (141
    )Balance, September 30, 2004
    
    $
    521
    
    
    $
    1
    
    
    $
    1
    
    
    $
    860
    
    
    $
    (58,787
    )
    
    $
    (4,170
    )
    
    $
    (61,574
    )Excess of the reduction in redeemable
preferred stock over total assets
divested and costs and liabilities
incurred on the Prince Transactions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    973
    
    
    
    
    
    
    
    973Dividends on Series C
redeemable preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (667
    )
    
    
    
    
    
    
    (667
    )Equity value accreted on
Series C redeemable
preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,208
    
    
    
    
    
    
    
    3,208Change in derivative
instruments, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    247
    
    
    
    247Foreign currency translation
adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,304
    
    
    
    5,304Net (loss)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,571
    )
    
    
    
    
    
    
    (7,571
    )Balance, December 31, 2004
    
    $
    521
    
    
    $
    1
    
    
    $
    1
    
    
    $
    860
    
    
    $
    (62,844
    )
    
    $
    1,381
    
    
    $
    (60,080
    )
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SIX MONTHS ENDEDDECEMBER 312004
    
    
    2003OPERATING ACTIVITIES:Net income (loss)
    
    $
    (7,712
    )
    
    $
    22,541Adjustment for discontinued operations
    
    
    
    
    
    
    172Income (loss) from continuing operations
    
    
    (7,712
    )
    
    
    22,713Adjustments to reconcile income (loss) from continuing operations to net
cash used by operating activities:Depreciation and amortization (includes accelerated depreciation from the Belgium
Plant Transactions of $533 for the six months ended December 31, 2004)
    
    
    7,308
    
    
    
    6,544Deferred income taxes
    
    
    (172
    )
    
    
    93Net gain on extinguishment of debt
    
    
    
    
    
    
    (23,226
    )Effects of changes in foreign currency
    
    
    (1,174
    )
    
    
    (1,166
    )Other
    
    
    366
    
    
    
    589Changes in operating assets and liabilities:Accounts receivable
    
    
    1,518
    
    
    
    (2,132
    )Inventories
    
    
    (11,641
    )
    
    
    (1,499
    )Prepaid expenses and other current assets
    
    
    1,456
    
    
    
    705Other assets
    
    
    316
    
    
    
    605Accounts payable
    
    
    (1,600
    )
    
    
    (6,749
    )Accrued expenses and other liabilities
    
    
    (913
    )
    
    
    4,516Accrued costs of non-completed transaction
    
    
    (1,893
    )
    
    
    Accrued costs of the Belgium Plant Transactions
    
    
    9,003
    
    
    
    Cash used by discontinued operations
    
    
    
    
    
    
    (1,665
    )NET CASH USED BY OPERATING ACTIVITIES
    
    
    (5,138
    )
    
    
    (672
    )INVESTING ACTIVITIES:Capital expenditures
    
    
    (3,676
    )
    
    
    (2,280
    )Proceeds from sale of assets
    
    
    40
    
    
    
    23Discontinued operations
    
    
    
    
    
    
    14,397NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES
    
    
    (3,636
    )
    
    
    12,140FINANCING ACTIVITIES:Net increase in cash overdraft
    
    
    896
    
    
    
    2,204Net decrease in short-term debt
    
    
    (10,699
    )
    
    
    (31,453
    )Proceeds from long-term debt
    
    
    26,100
    
    
    
    107,500Payments of long-term debt
    
    
    (1,862
    )
    
    
    (34,020
    )Payment of Pfizer obligations
    
    
    
    
    
    
    (28,300
    )Payments relating to the Prince Transactions and transaction costs
    
    
    
    
    
    
    (19,979
    )Debt refinancing costs
    
    
    (1,550
    )
    
    
    (11,496
    )Discontinued operations
    
    
    
    
    
    
    1,391NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES
    
    
    12,885
    
    
    
    (14,153
    )EFFECT OF EXCHANGE RATE CHANGES ON CASH
    
    
    491
    
    
    
    188NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    
    
    4,602
    
    
    
    (2,497
    )CASH AND CASH EQUIVALENTS at beginning of period
    
    
    5,568
    
    
    
    11,179CASH AND CASH EQUIVALENTS at end of period
    
    $
    10,170
    
    
    $
    8,682
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THREE MONTHS ENDED
    
    SIX MONTHS ENDEDDECEMBER 31, 2003
    
    DECEMBER 31, 2003Net sales
    
    $
    5,435
    
    
    $
    11,118Operating income
    
    
    1,065
    
    
    
    2,278Depreciation and amortization
    
    
    244
    
    
    
    487
   AS OFDECEMBER 31, 2004
    
    
    JUNE 30, 2004Raw materials
    
    $
    21,349
    
    
    $
    16,313Work-in-process
    
    
    1,782
    
    
    
    1,764Finished goods
    
    
    74,473
    
    
    
    61,833Total inventory
    
    $
    97,604
    
    
    $
    79,910
      SIX MONTHS ENDEDDECEMBER 31, 2003OPERATING RESULTS:Net sales
    
    $
    3,327Cost of goods sold
    
    
    3,135Selling, general and administrative expenses
    
    
    316Loss before income taxes
    
    
    (124
    )Provision for income taxes
    
    
    Loss from operations
    
    $
    (124
    )GAIN ON SALE:Current assets
    
    $
    (5,813
    )Property, plant & equipment  net and other assets
    
    
    (10,703
    )Current liabilities
    
    
    2,911Net proceeds of sale
    
    
    13,836Gain on sale
    
    $
    231
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THREE MONTHS ENDED
    
    
    SIX MONTHS ENDEDDECEMBER 31, 2003
    
    
    DECEMBER 31, 2003OPERATING RESULTS:Net sales
    
    $
    3,503
    
    
    $
    5,723Cost of goods sold
    
    
    3,199
    
    
    
    5,415Selling, general and administrative expenses
    
    
    412
    
    
    
    788Other (income)
    
    
    (193
    )
    
    
    (243
    )Interest expense
    
    
    26
    
    
    
    42Income (loss) before income taxes
    
    
    59
    
    
    
    (279
    )Provision for income taxes
    
    
    
    
    
    
    Income (loss) from operations$
    59
    
    
    $
    (279
    )Depreciation and amortization
    
    $
    101
    
    
    $
    201
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As ofDecember 31, 2004
    
    
    June 30, 2004Senior secured notes due December 1, 2007
    
    $
    127,491
    
    
    $
    105,000Senior subordinated notes due June 1, 2008
    
    
    48,029
    
    
    
    48,029Foreign bank loans
    
    
    7,192
    
    
    
    6,237Capitalized lease obligations and other
    
    
    
    
    
    
    103182,712
    
    
    
    159,369Less: current maturities
    
    $
    4,082
    
    
    $
    1,351178,630
    
    
    
    158,018
     Three Months Ended
    
    
    Six Months EndedDecember 31,
    
    
    December 31,DOMESTIC PENSION EXPENSE
    
    2004
    
    
    2003
    
    
    2004
    
    
    2003Service cost  benefits earned during the year
    
    $
    337
    
    
    $
    321
    
    
    $
    624
    
    
    $
    683Interest cost on benefit obligation
    
    
    315
    
    
    
    226
    
    
    
    479
    
    
    
    456Expected return on plan assets
    
    
    (308
    )
    
    
    (210
    )
    
    
    (458
    )
    
    
    (420
    )Amortization of initial unrecognized net transition
(asset)
    
    
    (2
    )
    
    
    (1
    )
    
    
    (2
    )
    
    
    (2
    )Amortization of prior service costs
    
    
    (55
    )
    
    
    (41
    )
    
    
    (72
    )
    
    
    (82
    )Amortization of net actuarial loss (gain)
    
    
    (2
    )
    
    
    5
    
    
    
    
    
    
    
    21Curtailment Benefit
    
    
    
    
    
    
    (64
    )
    
    
    
    
    
    
    (64
    )NET PERIODIC PENSION COST  DOMESTIC
    
    $
    285
    
    
    $
    236
    
    
    $
    571
    
    
    $
    592
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THREE MONTHS ENDED
    
    
    SIX MONTHS ENDEDDECEMBER 31,
    
    
    DECEMBER 31,INTERNATIONAL PENSION EXPENSE
    
    2004
    
    
    2003
    
    
    2004
    
    
    2003Service cost  benefits earned during the year
    
    $
    114
    
    
    $
    117
    
    
    $
    236
    
    
    $
    227Interest cost on benefit obligation
    
    
    111
    
    
    
    94
    
    
    
    209
    
    
    
    182Expected return on plan assets
    
    
    (100
    )
    
    
    (75
    )
    
    
    (179
    )
    
    
    (146
    )Amortization of net actuarial loss (gain)
    
    
    (5
    )
    
    
    5
    
    
    
    1
    
    
    
    11NET PERIODIC PENSION COST  INTERNATIONAL
    
    $
    120
    
    
    $
    141
    
    
    $
    267
    
    
    $
    274
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ANIMALHEALTH &
    
    INDUSTRIAL
    
    
    
    
    
    ALL
    
    CORPORATE &THREE MONTHS ENDED DECEMBER 31, 2004
    
    NUTRITION
    
    CHEMICALS
    
    DISTRIBUTION
    
    OTHER
    
    OTHER
    
    TOTALNet sales
    
    $
    70,708
    
    
    $
    7,686
    
    
    $
    8,104
    
    
    $
    6,562
    
    
    $
    
    
    
    $
    93,060Operating income (loss)
    
    
    (1,520
    )
    
    
    655
    
    
    
    796
    
    
    
    455
    
    
    
    (4,276
    )
    
    
    (3,890
    )Depreciation and amortization
    
    
    2,705
    
    
    
    413
    
    
    
    6
    
    
    
    104
    
    
    
    725
    
    
    
    3,953
  ANIMALHEALTH &
    
    INDUSTRIAL
    
    
    
    
    
    ALL
    
    CORPORATE &THREE MONTHS ENDED DECEMBER 31, 2003
    
    NUTRITION
    
    CHEMICALS
    
    DISTRIBUTION
    
    OTHER
    
    OTHER
    
    TOTALNet sales
    
    $
    68,687
    
    
    $
    11,679
    
    
    $
    7,656
    
    
    $
    4,518
    
    
    $
    
    
    
    $
    92,540Operating income (loss)
    
    
    7,655
    
    
    
    778
    
    
    
    692
    
    
    
    657
    
    
    
    (4,057
    )
    
    
    5,725Depreciation and amortization
    
    
    2,059
    
    
    
    639
    
    
    
    4
    
    
    
    98
    
    
    
    576
    
    
    
    3,376
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ANIMALHEALTH &
    
    
    INDUSTRIAL
    
    
    
    
    
    
    ALL
    
    
    CORPORATE &SIX MONTHS ENDED DECEMBER 31, 2004
    
    NUTRITION
    
    
    CHEMICALS
    
    
    DISTRIBUTION
    
    
    OTHER
    
    
    OTHER
    
    
    TOTALNet sales
    
    $
    136,514
    
    
    $
    16,079
    
    
    $
    15,765
    
    
    $
    12,977
    
    
    $
    
    
    
    $
    181,335Operating income/(loss)
    
    
    6,295
    
    
    
    1,428
    
    
    
    1,660
    
    
    
    1,160
    
    
    
    (8,405
    )
    
    
    2,138Depreciation and amortization
    
    
    4,900
    
    
    
    816
    
    
    
    8
    
    
    
    204
    
    
    
    1,380
    
    
    
    7,308
  ANIMALHEALTH &
    
    
    INDUSTRIAL
    
    
    
    
    
    
    ALL
    
    
    CORPORATE &SIX MONTHS ENDED DECEMBER 31, 2003
    
    NUTRITION
    
    
    CHEMICALS
    
    
    DISTRIBUTION
    
    
    OTHER
    
    
    OTHER
    
    
    TOTALNet sales
    
    $
    128,528
    
    
    $
    23,661
    
    
    $
    15,595
    
    
    $
    9,706
    
    
    $
    
    
    
    $
    177,490Operating income/(loss)
    
    
    14,555
    
    
    
    1,600
    
    
    
    1,533
    
    
    
    1,326
    
    
    
    (7,914
    )
    
    
    11,100Depreciation and amortization
    
    
    4,088
    
    
    
    1,288
    
    
    
    7
    
    
    
    213
    
    
    
    948
    
    
    
    6,544
 ANIMALIDENTIFIABLE ASSETS OF
    
    HEALTH &
    
    
    INDUSTRIAL
    
    
    
    
    
    
    ALL
    
    
    CORPORATE &CONTINUING OPERATIONS
    
    NUTRITION
    
    
    CHEMICALS
    
    
    DISTRIBUTION
    
    
    OTHER
    
    
    OTHER
    
    
    TOTALAt December 30, 2004
    
    $
    209,126
    
    
    $
    26,123
    
    
    $
    7,775
    
    
    $
    5,946
    
    
    $
    16,080
    
    
    $
    265,050At June 30, 2004
    
    
    185,601
    
    
    
    26,146
    
    
    
    7,715
    
    
    
    5,696
    
    
    
    16,211
    
    
    
    241,369
    19




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##### Table of Contents



20




---



##### Table of Contents



U.S.Parent
    
    
    Unrestricted
    
    
    Guarantor
    
    
    Dutch
    
    
    Belgium
    
    
    Non-Guarantor
    
    
    Consolidation
    
    
    ConsolidatedIssuer
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Issuer
    
    
    Guarantor
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    BalanceASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    13
    
    
    $
    
    
    
    $
    968
    
    
    $
    2
    
    
    $
    5,369
    
    
    $
    3,818
    
    
    $
    
    
    
    $
    10,170Trade receivables
    
    
    2,821
    
    
    
    
    
    
    
    28,004
    
    
    
    
    
    
    
    2,170
    
    
    
    23,880
    
    
    
    
    
    
    
    56,875Other receivables
    
    
    693
    
    
    
    
    
    
    
    2,066
    
    
    
    
    
    
    
    766
    
    
    
    945
    
    
    
    
    
    
    
    4,470Inventory
    
    
    2,867
    
    
    
    
    
    
    
    35,276
    
    
    
    
    
    
    
    34,888
    
    
    
    24,573
    
    
    
    
    
    
    
    97,604Prepaid expenses and other
    
    
    1,360
    
    
    
    
    
    
    
    64
    
    
    
    
    
    
    
    1,516
    
    
    
    3,974
    
    
    
    
    
    
    
    6,914TOTAL CURRENT ASSETS
    
    
    7,754
    
    
    
    
    
    
    
    66,378
    
    
    
    2
    
    
    
    44,709
    
    
    
    57,190
    
    
    
    
    
    
    
    176,033Property, plant &
equipment, net
    
    
    743
    
    
    
    
    
    
    
    13,821
    
    
    
    
    
    
    
    17,743
    
    
    
    28,804
    
    
    
    
    
    
    
    61,111Intangibles
    
    
    
    
    
    
    
    
    
    
    4,039
    
    
    
    
    
    
    
    1,621
    
    
    
    5,456
    
    
    
    
    
    
    
    11,116Investment in subsidiaries
    
    
    108,057
    
    
    
    
    
    
    
    
    
    
    
    (3,728
    )
    
    
    
    
    
    
    
    
    
    
    (104,329
    )
    
    
    Intercompany
    
    
    9,366
    
    
    
    
    
    
    
    68,136
    
    
    
    26,903
    
    
    
    (5,194
    )
    
    
    (11,407
    )
    
    
    (87,804
    )
    
    
    Other assets
    
    
    15,191
    
    
    
    
    
    
    
    1,142
    
    
    
    
    
    
    
    
    
    
    
    457
    
    
    
    
    
    
    
    16,790$
    141,111
    
    
    $
    
    
    
    $
    153,516
    
    
    $
    23,177
    
    
    $
    58,879
    
    
    $
    80,500
    
    
    $
    (192,133
    )
    
    $
    265,050LIABILITIES AND
STOCKHOLDERS EQUITY
(DEFICIT)CURRENT LIABILITIES:Cash overdraft
    
    $
    
    
    
    $
    
    
    
    $
    1,787
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    1,787Loan payable to banks
    
    
    297
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    297Current portion of
long-term debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,082
    
    
    
    
    
    
    
    4,082Accounts payable
    
    
    4,011
    
    
    
    
    
    
    
    28,077
    
    
    
    
    
    
    
    2,561
    
    
    
    11,719
    
    
    
    
    
    
    
    46,368Accrued expenses
and other
    
    
    9,397
    
    
    
    
    
    
    
    9,071
    
    
    
    217
    
    
    
    21,734
    
    
    
    7,390
    
    
    
    
    
    
    
    47,809TOTAL CURRENT
LIABILITIES
    
    
    13,705
    
    
    
    
    
    
    
    38,935
    
    
    
    217
    
    
    
    24,295
    
    
    
    23,191
    
    
    
    
    
    
    
    100,343Long-term debt
    
    
    151,236
    
    
    
    
    
    
    
    
    
    
    
    24,284
    
    
    
    
    
    
    
    3,110
    
    
    
    
    
    
    
    178,630Intercompany debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,411
    
    
    
    37,881
    
    
    
    47,512
    
    
    
    (87,804
    )
    
    
    Other liabilities
    
    
    13,433
    
    
    
    
    
    
    
    5,522
    
    
    
    
    
    
    
    431
    
    
    
    3,954
    
    
    
    
    
    
    
    23,340TOTAL LIABILITIES
    
    
    178,374
    
    
    
    
    
    
    
    44,457
    
    
    
    26,912
    
    
    
    62,607
    
    
    
    77,767
    
    
    
    (87,804
    )
    
    
    302,313REDEEMABLE SECURITIES:Series C preferred stock
    
    
    22,817
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,817STOCKHOLDERS EQUITY
(DEFICIT):Series A preferred stock
    
    
    521
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    521Common stock
    
    
    2
    
    
    
    
    
    
    
    33
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (33
    )
    
    
    2Paid-in capital
    
    
    860
    
    
    
    
    
    
    
    108,383
    
    
    
    21
    
    
    
    52
    
    
    
    1,537
    
    
    
    (109,993
    )
    
    
    860Retained earnings
(accumulated deficit)
    
    
    (62,844
    )
    
    
    
    
    
    
    610
    
    
    
    (10,906
    )
    
    
    (10,930
    )
    
    
    6,997
    
    
    
    14,229
    
    
    
    (62,844
    )Accumulated other
comprehensive
income (loss):
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Gain on derivative
instruments
    
    
    331
    
    
    
    
    
    
    
    331
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (331
    )
    
    
    331Cumulative currency
translation adjustment
    
    
    1,050
    
    
    
    
    
    
    
    (298
    )
    
    
    7,150
    
    
    
    7,150
    
    
    
    (5,801
    )
    
    
    (8,201
    )
    
    
    1,050TOTAL STOCKHOLDERS
EQUITY (DEFICIT)
    
    
    (60,080
    )
    
    
    
    
    
    
    109,059
    
    
    
    (3,735
    )
    
    
    (3,728
    )
    
    
    2,733
    
    
    
    (104,329
    )
    
    
    (60,080
    )$
    141,111
    
    
    $
    
    
    
    $
    153,516
    
    
    $
    23,177
    
    
    $
    58,879
    
    
    $
    80,500
    
    
    $
    (192,133
    )
    
    $
    265,050
 21




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##### Table of Contents



Parent
    
    
    Unrestricted
    
    
    U.S. Guarantor
    
    
    Dutch
    
    
    Belgium
    
    
    Non-Guarantor
    
    
    Consolidation
    
    
    ConsolidatedIssuer
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Issuer
    
    
    Guarantor
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    BalanceNET SALES
    
    $
    6,247
    
    
    $
    
    
    
    $
    57,791
    
    
    $
    
    
    
    $
    2,560
    
    
    $
    26,462
    
    
    $
    
    
    
    $
    93,060NET SALES  INTERCOMPANY
    
    
    37
    
    
    
    
    
    
    
    38
    
    
    
    
    
    
    
    4,456
    
    
    
    2,342
    
    
    
    (6,873
    )
    
    
    COST OF GOODS SOLD
(includes Belgium
Plant Transactions
costs of $9,536)
    
    
    5,034
    
    
    
    
    
    
    
    43,358
    
    
    
    
    
    
    
    16,085
    
    
    
    21,587
    
    
    
    (6,873
    )
    
    
    79,191GROSS PROFIT
    
    
    1,250
    
    
    
    
    
    
    
    14,471
    
    
    
    
    
    
    
    (9,069
    )
    
    
    7,217
    
    
    
    
    
    
    
    13,869SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    5,315
    
    
    
    
    
    
    
    7,393
    
    
    
    
    
    
    
    813
    
    
    
    4,238
    
    
    
    
    
    
    
    17,759OPERATING INCOME (LOSS)
    
    
    (4,065
    )
    
    
    
    
    
    
    7,078
    
    
    
    
    
    
    
    (9,882
    )
    
    
    2,979
    
    
    
    
    
    
    
    (3,890
    )OTHER:Interest expense
    
    
    4,585
    
    
    
    
    
    
    
    2
    
    
    
    649
    
    
    
    12
    
    
    
    141
    
    
    
    
    
    
    
    5,389Interest (income)
    
    
    (1
    )
    
    
    
    
    
    
    (4
    )
    
    
    
    
    
    
    
    
    
    
    (28
    )
    
    
    
    
    
    
    (33
    )Other (income) expense,
net
    
    
    3
    
    
    
    
    
    
    
    (146
    )
    
    
    
    
    
    
    (152
    )
    
    
    (496
    )
    
    
    
    
    
    
    (791
    )Intercompany interest
and other
    
    
    (6,407
    )
    
    
    
    
    
    
    4,937
    
    
    
    (656
    )
    
    
    942
    
    
    
    1,184
    
    
    
    
    
    
    
    (Profit) loss relating
to subsidiaries
    
    
    5,122
    
    
    
    
    
    
    
    
    
    
    
    9,071
    
    
    
    
    
    
    
    
    
    
    
    (14,193
    )
    
    
    INCOME (LOSS) FROM
CONTINUING OPERATIONS
BEFORE INCOME TAXES
    
    
    (7,367
    )
    
    
    
    
    
    
    2,289
    
    
    
    (9,064
    )
    
    
    (10,684
    )
    
    
    2,178
    
    
    
    14,193
    
    
    
    (8,455
    )PROVISION (BENEFIT)
FOR INCOME TAXES
    
    
    204
    
    
    
    
    
    
    
    195
    
    
    
    
    
    
    
    (1,613
    )
    
    
    330
    
    
    
    
    
    
    
    (884
    )INCOME (LOSS) FROM
CONTINUING OPERATIONS
    
    
    (7,571
    )
    
    
    
    
    
    
    2,094
    
    
    
    (9,064
    )
    
    
    (9,071
    )
    
    
    1,848
    
    
    
    14,193
    
    
    
    (7,571
    )DISCONTINUED OPERATIONS:Profit (loss) relating
to discontinued
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Loss) from discontinued
operations
(net of income taxes)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Gain (loss) from
disposal of
discontinued operations
(net of income taxes)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    NET INCOME (LOSS)
    
    $
    (7,571
    )
    
    $
    
    
    
    $
    2,094
    
    
    $
    (9,064
    )
    
    $
    (9,071
    )
    
    $
    1,848
    
    
    $
    14,193
    
    
    $
    (7,571
    )
 22




---



##### Table of Contents



Parent
    
    
    Unrestricted
    
    
    U.S. Guarantor
    
    
    Dutch
    
    
    Belgium
    
    
    Non-Guarantor
    
    
    Consolidation
    
    
    ConsolidatedIssuer
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Issuer
    
    
    Guarantor
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    BalanceNET SALES
    
    $
    12,176
    
    
    $
    
    
    
    $
    114,466
    
    
    $
    
    
    
    $
    4,228
    
    
    $
    50,465
    
    
    $
    
    
    
    $
    181,335NET SALES  INTERCOMPANY
    
    
    93
    
    
    
    
    
    
    
    131
    
    
    
    
    
    
    
    10,660
    
    
    
    3,417
    
    
    
    (14,301
    )
    
    
    COST OF GOODS SOLD
(includes Belgium Plant
Transactions costs
of $8,287)
    
    
    9,654
    
    
    
    
    
    
    
    84,992
    
    
    
    
    
    
    
    20,784
    
    
    
    43,715
    
    
    
    (14,301
    )
    
    
    144,844GROSS PROFIT
    
    
    2,615
    
    
    
    
    
    
    
    29,605
    
    
    
    
    
    
    
    (5,896
    )
    
    
    10,167
    
    
    
    
    
    
    
    36,491SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    10,218
    
    
    
    
    
    
    
    14,349
    
    
    
    6
    
    
    
    1,366
    
    
    
    8,414
    
    
    
    
    
    
    
    34,353OPERATING INCOME (LOSS)
    
    
    (7,603
    )
    
    
    
    
    
    
    15,256
    
    
    
    (6
    )
    
    
    (7,262
    )
    
    
    1,753
    
    
    
    
    
    
    
    2,138OTHER:Interest expense
    
    
    8,937
    
    
    
    
    
    
    
    
    
    
    
    1,299
    
    
    
    23
    
    
    
    376
    
    
    
    
    
    
    
    10,635Interest (income)
    
    
    (2
    )
    
    
    
    
    
    
    (4
    )
    
    
    
    
    
    
    
    
    
    
    (52
    )
    
    
    
    
    
    
    (58
    )Other (income)
expense, net
    
    
    4
    
    
    
    
    
    
    
    (374
    )
    
    
    
    
    
    
    (211
    )
    
    
    (186
    )
    
    
    
    
    
    
    (767
    )Intercompany interest
and other
    
    
    (13,934
    )
    
    
    
    
    
    
    10,386
    
    
    
    (1,316
    )
    
    
    1,881
    
    
    
    2,983
    
    
    
    
    
    
    
    (Profit) loss relating
to subsidiaries
    
    
    4,590
    
    
    
    
    
    
    
    
    
    
    
    7,504
    
    
    
    
    
    
    
    
    
    
    
    (12,094
    )
    
    
    INCOME (LOSS) FROM
CONTINUING OPERATIONS
BEFORE INCOME TAXES
    
    
    (7,198
    )
    
    
    
    
    
    
    5,248
    
    
    
    (7,493
    )
    
    
    (8,955
    )
    
    
    (1,368
    )
    
    
    12,094
    
    
    
    (7,672
    )PROVISION (BENEFIT) FOR
INCOME TAXES
    
    
    514
    
    
    
    
    
    
    
    299
    
    
    
    
    
    
    
    (1,451
    )
    
    
    678
    
    
    
    
    
    
    
    40INCOME (LOSS) FROM
CONTINUING OPERATIONS
    
    
    (7,712
    )
    
    
    
    
    
    
    4,949
    
    
    
    (7,493
    )
    
    
    (7,504
    )
    
    
    (2,046
    )
    
    
    12,094
    
    
    
    (7,712
    )DISCONTINUED OPERATIONS:Profit (loss) relating to
discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (Loss) from discontinued
operations
(net of income taxes)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Gain (loss) from
disposal of discontinued
operations (net of
income taxes)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    NET INCOME (LOSS)
    
    $
    (7,712
    )
    
    $
    
    
    
    $
    4,949
    
    
    $
    (7,493
    )
    
    $
    (7,504
    )
    
    $
    (2,046
    )
    
    $
    12,094
    
    
    $
    (7,712
    )
 23




---



##### Table of Contents



Parent
    
    
    Unrestricted
    
    
    U.S. Guarantor
    
    
    Dutch
    
    
    Belgium
    
    
    Non-Guarantor
    
    
    Consolidation
    
    
    ConsolidatedIssuer
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Issuer
    
    
    Guarantor
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    BalanceOPERATING ACTIVITIES:Net income (loss)
    
    $
    (7,712
    )
    
    $
    
    
    
    $
    4,949
    
    
    $
    (7,493
    )
    
    $
    (7,504
    )
    
    $
    (2,046
    )
    
    $
    12,094
    
    
    $
    (7,712
    )Adjustment for
discontinued
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Income (loss) from
continuing operations
    
    
    (7,712
    )
    
    
    
    
    
    
    4,949
    
    
    
    (7,493
    )
    
    
    (7,504
    )
    
    
    (2,046
    )
    
    
    12,094
    
    
    
    (7,712
    )Adjustments to reconcile
income (loss) from
continuing operations
to net cash provided
(used) by operating
activities:Depreciation
and amortization
(includes accelerated
depreciation from the
Belgium Plant
Transactions of $533)
    
    
    1,380
    
    
    
    
    
    
    
    1,435
    
    
    
    
    
    
    
    2,008
    
    
    
    2,485
    
    
    
    
    
    
    
    7,308Deferred income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (172
    )
    
    
    
    
    
    
    (172
    )Effects of changes in
foreign currency
    
    
    
    
    
    
    
    
    
    
    (411
    )
    
    
    
    
    
    
    (211
    )
    
    
    (552
    )
    
    
    
    
    
    
    (1,174
    )Other
    
    
    286
    
    
    
    
    
    
    
    85
    
    
    
    
    
    
    
    
    
    
    
    (5
    )
    
    
    
    
    
    
    366Changes in operating
assets and
liabilities:
    
    
    Accounts receivable
    
    
    (156
    )
    
    
    
    
    
    
    (857
    )
    
    
    
    
    
    
    660
    
    
    
    1,871
    
    
    
    
    
    
    
    1,518Inventory
    
    
    (873
    )
    
    
    
    
    
    
    3,580
    
    
    
    
    
    
    
    (8,513
    )
    
    
    (5,835
    )
    
    
    
    
    
    
    (11,641
    )Prepaid expenses and
other
    
    
    1,512
    
    
    
    
    
    
    
    233
    
    
    
    
    
    
    
    (1,029
    )
    
    
    740
    
    
    
    
    
    
    
    1,456Other assets
    
    
    255
    
    
    
    
    
    
    
    (189
    )
    
    
    
    
    
    
    
    
    
    
    250
    
    
    
    
    
    
    
    316Intercompany
    
    
    1,276
    
    
    
    5
    
    
    
    (9,084
    )
    
    
    3,193
    
    
    
    11,918
    
    
    
    4,786
    
    
    
    (12,094
    )
    
    
    Accounts payable
    
    
    (1,171
    )
    
    
    6
    
    
    
    (386
    )
    
    
    
    
    
    
    47
    
    
    
    (96
    )
    
    
    
    
    
    
    (1,600
    )Accrued expenses and
other
    
    
    801
    
    
    
    (1
    )
    
    
    1,170
    
    
    
    1
    
    
    
    (965
    )
    
    
    (1,919
    )
    
    
    
    
    
    
    (913
    )Accrued costs of
non-completed
transaction
    
    
    (1,893
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,893
    )Accrued costs of the
Belgium Plant
Transactions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,003
    
    
    
    
    
    
    
    
    
    
    
    9,003NET CASH PROVIDED
(USED) BY OPERATING
ACTIVITIES
    
    
    (6,295
    )
    
    
    10
    
    
    
    525
    
    
    
    (4,299
    )
    
    
    5,414
    
    
    
    (493
    )
    
    
    
    
    
    
    (5,138
    )INVESTING ACTIVITIES:Capital expenditures
    
    
    (686
    )
    
    
    
    
    
    
    (1,184
    )
    
    
    
    
    
    
    (459
    )
    
    
    (1,347
    )
    
    
    
    
    
    
    (3,676
    )Proceeds from sale of
assets
    
    
    
    
    
    
    
    
    
    
    16
    
    
    
    
    
    
    
    
    
    
    
    24
    
    
    
    
    
    
    
    40Other investing
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (182
    )
    
    
    182
    
    
    
    
    
    
    
    NET CASH PROVIDED (USED)
BY INVESTING ACTIVITIES
    
    
    (686
    )
    
    
    
    
    
    
    (1,168
    )
    
    
    
    
    
    
    (641
    )
    
    
    (1,141
    )
    
    
    
    
    
    
    (3,636
    )FINANCING ACTIVITIES:Net increase (decrease)
in cash overdraft
    
    
    
    
    
    
    (10
    )
    
    
    906
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    896Net (decrease) in
short-term debt
    
    
    (10,699
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,699
    )Proceeds from long-term
debt
    
    
    19,107
    
    
    
    
    
    
    
    
    
    
    
    4,284
    
    
    
    
    
    
    
    2,709
    
    
    
    
    
    
    
    26,100Payments of long-term
debt
    
    
    
    
    
    
    
    
    
    
    (103
    )
    
    
    
    
    
    
    
    
    
    
    (1,759
    )
    
    
    
    
    
    
    (1,862
    )Debt refinancing costs
    
    
    (1,550
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,550
    )NET CASH PROVIDED (USED)
BY FINANCING ACTIVITIES
    
    
    6,858
    
    
    
    (10
    )
    
    
    803
    
    
    
    4,284
    
    
    
    
    
    
    
    950
    
    
    
    
    
    
    
    12,885EFFECT OF EXCHANGE RATE
CHANGES ON CASH
    
    
    
    
    
    
    
    
    
    
    7
    
    
    
    
    
    
    
    384
    
    
    
    100
    
    
    
    
    
    
    
    491NET INCREASE (DECREASE)
IN CASH AND CASH
EQUIVALENTS
    
    
    (123
    )
    
    
    
    
    
    
    167
    
    
    
    (15
    )
    
    
    5,157
    
    
    
    (584
    )
    
    
    
    
    
    
    4,602CASH AND CASH EQUIVALENTS
at beginning of period
    
    
    136
    
    
    
    
    
    
    
    801
    
    
    
    17
    
    
    
    212
    
    
    
    4,402
    
    
    
    
    
    
    
    5,568CASH AND CASH EQUIVALENTS
at end of period
    
    $
    13
    
    
    $
    
    
    
    $
    968
    
    
    $
    2
    
    
    $
    5,369
    
    
    $
    3,818
    
    
    $
    
    
    
    $
    10,170
 24




---



##### Table of Contents



Parent
    
    
    Unrestricted
    
    
    U.S. Guarantor
    
    
    Dutch
    
    
    Belgium
    
    
    Non-Guarantor
    
    
    Consolidation
    
    
    ConsolidatedIssuer
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Issuer
    
    
    Guarantor
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    BalanceASSETSCURRENT ASSETS:Cash and cash
equivalents
    
    $
    136
    
    
    $
    
    
    
    $
    801
    
    
    $
    17
    
    
    $
    212
    
    
    $
    4,402
    
    
    $
    
    
    
    $
    5,568Trade receivables
    
    
    2,670
    
    
    
    
    
    
    
    26,996
    
    
    
    
    
    
    
    2,592
    
    
    
    25,400
    
    
    
    
    
    
    
    57,658Other receivables
    
    
    317
    
    
    
    414
    
    
    
    1,195
    
    
    
    
    
    
    
    72
    
    
    
    768
    
    
    
    
    
    
    
    2,766Inventory
    
    
    1,994
    
    
    
    
    
    
    
    37,890
    
    
    
    
    
    
    
    23,159
    
    
    
    16,867
    
    
    
    
    
    
    
    79,910Prepaid expenses and
other
    
    
    3,195
    
    
    
    110
    
    
    
    565
    
    
    
    
    
    
    
    1,018
    
    
    
    3,800
    
    
    
    
    
    
    
    8,688TOTAL CURRENT ASSETS
    
    
    8,312
    
    
    
    524
    
    
    
    67,447
    
    
    
    17
    
    
    
    27,053
    
    
    
    51,237
    
    
    
    
    
    
    
    154,590Property, plant &
equipment, net
    
    
    105
    
    
    
    
    
    
    
    13,730
    
    
    
    
    
    
    
    17,321
    
    
    
    27,630
    
    
    
    
    
    
    
    58,786Intangibles
    
    
    
    
    
    
    
    
    
    
    4,252
    
    
    
    
    
    
    
    1,569
    
    
    
    5,874
    
    
    
    
    
    
    
    11,695Investment in
subsidiaries
    
    
    125,355
    
    
    
    
    
    
    
    
    
    
    
    1,604
    
    
    
    
    
    
    
    
    
    
    
    (126,959
    )
    
    
    Intercompany
    
    
    (14,995
    )
    
    
    20,995
    
    
    
    60,030
    
    
    
    20,181
    
    
    
    1,630
    
    
    
    (12,497
    )
    
    
    (75,344
    )
    
    
    Other assets
    
    
    14,506
    
    
    
    
    
    
    
    1,056
    
    
    
    
    
    
    
    
    
    
    
    736
    
    
    
    
    
    
    
    16,298$
    133,283
    
    
    $
    21,519
    
    
    $
    146,515
    
    
    $
    21,802
    
    
    $
    47,573
    
    
    $
    72,980
    
    
    $
    (202,303
    )
    
    $
    241,369LIABILITIES AND
STOCKHOLDERS
EQUITY (DEFICIT)CURRENT LIABILITIES:Cash overdraft
    
    $
    
    
    
    $
    10
    
    
    $
    881
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    891Loan payable to banks
    
    
    10,996
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,996Current portion of
long-term debt
    
    
    
    
    
    
    
    
    
    
    101
    
    
    
    
    
    
    
    
    
    
    
    1,250
    
    
    
    
    
    
    
    1,351Accounts payable
    
    
    4,734
    
    
    
    9
    
    
    
    28,434
    
    
    
    
    
    
    
    2,258
    
    
    
    11,537
    
    
    
    
    
    
    
    46,972Accrued expenses
and other
    
    
    11,857
    
    
    
    159
    
    
    
    8,306
    
    
    
    216
    
    
    
    12,022
    
    
    
    7,450
    
    
    
    
    
    
    
    40,010TOTAL CURRENT
LIABILITIES
    
    
    27,587
    
    
    
    178
    
    
    
    37,722
    
    
    
    216
    
    
    
    14,280
    
    
    
    20,237
    
    
    
    
    
    
    
    100,220Long-term debt
    
    
    133,029
    
    
    
    
    
    
    
    2
    
    
    
    20,000
    
    
    
    
    
    
    
    4,987
    
    
    
    
    
    
    
    158,018Intercompany debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,553
    
    
    
    44,791
    
    
    
    (75,344
    )
    
    
    Other liabilities
    
    
    11,822
    
    
    
    
    
    
    
    4,897
    
    
    
    
    
    
    
    1,136
    
    
    
    4,431
    
    
    
    
    
    
    
    22,286TOTAL LIABILITIES
    
    
    172,438
    
    
    
    178
    
    
    
    42,621
    
    
    
    20,216
    
    
    
    45,969
    
    
    
    74,446
    
    
    
    (75,344
    )
    
    
    280,524REDEEMABLE SECURITIES:Series C preferred
stock
    
    
    24,678
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    24,678STOCKHOLDERS EQUITY
(DEFICIT):Series A preferred
stock
    
    
    521
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    521Common stock
    
    
    2
    
    
    
    1
    
    
    
    33
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (34
    )
    
    
    2Paid-in capital
    
    
    860
    
    
    
    
    
    
    
    108,383
    
    
    
    21
    
    
    
    52
    
    
    
    1,537
    
    
    
    (109,993
    )
    
    
    860Retained earnings
(accumulated deficit)
    
    
    (57,964
    )
    
    
    21,340
    
    
    
    (4,339
    )
    
    
    (2,744
    )
    
    
    (2,757
    )
    
    
    8,374
    
    
    
    (19,874
    )
    
    
    (57,964
    )Accumulated other
comprehensive
income (loss):
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Gain on derivative
instruments
    
    
    9
    
    
    
    
    
    
    
    9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (9
    )
    
    
    9Cumulative currency
translation adjustment
    
    
    (7,261
    )
    
    
    
    
    
    
    (192
    )
    
    
    4,309
    
    
    
    4,309
    
    
    
    (11,377
    )
    
    
    2,951
    
    
    
    (7,261
    )TOTAL STOCKHOLDERS
EQUITY (DEFICIT)
    
    
    (63,833
    )
    
    
    21,341
    
    
    
    103,894
    
    
    
    1,586
    
    
    
    1,604
    
    
    
    (1,466
    )
    
    
    (126,959
    )
    
    
    (63,833
    )$
    133,283
    
    
    $
    21,519
    
    
    $
    146,515
    
    
    $
    21,802
    
    
    $
    47,573
    
    
    $
    72,980
    
    
    $
    (202,303
    )
    
    $
    241,369
 25




---



##### Table of Contents



Parent
    
    
    Unrestricted
    
    
    U.S. Guarantor
    
    
    Dutch
    
    
    Belgium
    
    
    Non-Guarantors
    
    
    Consolidation
    
    
    ConsolidatedIssuer
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Issuer
    
    
    Guarantor
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    BalanceNET SALES
    
    $
    5,425
    
    
    $
    5,435
    
    
    $
    54,601
    
    
    $
    
    
    
    $
    1,248
    
    
    $
    25,831
    
    
    $
    
    
    
    $
    92,540NET SALES  INTERCOMPANY
    
    
    52
    
    
    
    1,259
    
    
    
    184
    
    
    
    
    
    
    
    3,727
    
    
    
    1,405
    
    
    
    (6,627
    )
    
    
    COST OF GOODS SOLD
    
    
    4,311
    
    
    
    5,005
    
    
    
    41,326
    
    
    
    
    
    
    
    4,774
    
    
    
    21,202
    
    
    
    (6,627
    )
    
    
    69,991GROSS PROFIT
    
    
    1,166
    
    
    
    1,689
    
    
    
    13,459
    
    
    
    
    
    
    
    201
    
    
    
    6,034
    
    
    
    
    
    
    
    22,549SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    5,395
    
    
    
    624
    
    
    
    6,154
    
    
    
    2
    
    
    
    561
    
    
    
    4,088
    
    
    
    
    
    
    
    16,824OPERATING INCOME (LOSS)
    
    
    (4,229
    )
    
    
    1,065
    
    
    
    7,305
    
    
    
    (2
    )
    
    
    (360
    )
    
    
    1,946
    
    
    
    
    
    
    
    5,725OTHER:Interest expense
    
    
    4,029
    
    
    
    7
    
    
    
    
    
    
    
    506
    
    
    
    19
    
    
    
    (12
    )
    
    
    
    
    
    
    4,549Interest (income)
    
    
    (3
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30
    
    
    
    141
    
    
    
    
    
    
    
    168Other (income) expense,
net
    
    
    300
    
    
    
    
    
    
    
    (34
    )
    
    
    
    
    
    
    566
    
    
    
    (705
    )
    
    
    
    
    
    
    127Net (gain) on
extinguishment of debt
    
    
    (23,226
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (23,226
    )Intercompany interest
and other
    
    
    (5,753
    )
    
    
    810
    
    
    
    2,949
    
    
    
    (510
    )
    
    
    750
    
    
    
    1,754
    
    
    
    (Profit) loss relating
to subsidiaries
    
    
    (2,753
    )
    
    
    
    
    
    
    
    
    
    
    1,052
    
    
    
    
    
    
    
    
    
    
    
    1,701
    
    
    
    INCOME (LOSS) FROM
CONTINUING OPERATIONS
BEFORE INCOME TAXES
    
    
    23,177
    
    
    
    248
    
    
    
    4,390
    
    
    
    (1,050
    )
    
    
    (1,725
    )
    
    
    768
    
    
    
    (1,701
    )
    
    
    24,107PROVISION (BENEFIT) FOR
INCOME TAXES
    
    
    1,950
    
    
    
    80
    
    
    
    454
    
    
    
    
    
    
    
    (673
    )
    
    
    1,069
    
    
    
    
    
    
    
    2,880INCOME (LOSS) FROM
CONTINUING OPERATIONS
    
    
    21,227
    
    
    
    168
    
    
    
    3,936
    
    
    
    (1,050
    )
    
    
    (1,052
    )
    
    
    (301
    )
    
    
    (1,701
    )
    
    
    21,227DISCONTINUED OPERATIONS:Profit (loss) relating to
discontinued operations
    
    
    59
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (59
    )
    
    
    Profit from discontinued
operations
(net of income taxes)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    59
    
    
    
    
    
    
    
    59Gain from disposal of
discontinued operations
(net of income taxes)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    NET INCOME (LOSS)
    
    $
    21,286
    
    
    $
    168
    
    
    $
    3,936
    
    
    $
    (1,050
    )
    
    $
    (1,052
    )
    
    $
    (242
    )
    
    $
    (1,760
    )
    
    $
    21,286
 26




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##### Table of Contents



Parent
    
    
    Unrestricted
    
    
    U.S. Guarantor
    
    
    Dutch
    
    
    Belgium
    
    
    Non-Guarantors
    
    
    Consolidation
    
    
    ConsolidatedIssuer
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Issuer
    
    
    Guarantor
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    BalanceNET SALES
    
    $
    11,122
    
    
    $
    11,118
    
    
    $
    102,696
    
    
    $
    
    
    
    $
    2,240
    
    
    $
    50,314
    
    
    $
    
    
    
    $
    177,490NET SALES  INTERCOMPANY
    
    
    97
    
    
    
    2,598
    
    
    
    393
    
    
    
    
    
    
    
    12,996
    
    
    
    2,175
    
    
    
    (18,259
    )
    
    
    COST OF GOODS SOLD
    
    
    8,819
    
    
    
    10,139
    
    
    
    77,219
    
    
    
    
    
    
    
    13,971
    
    
    
    41,892
    
    
    
    (18,259
    )
    
    
    133,781GROSS PROFIT
    
    
    2,400
    
    
    
    3,577
    
    
    
    25,870
    
    
    
    
    
    
    
    1,265
    
    
    
    10,597
    
    
    
    
    
    
    
    43,709SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    10,068
    
    
    
    1,299
    
    
    
    12,375
    
    
    
    2
    
    
    
    1,084
    
    
    
    7,781
    
    
    
    
    
    
    
    32,609OPERATING INCOME (LOSS)
    
    
    (7,668
    )
    
    
    2,278
    
    
    
    13,495
    
    
    
    (2
    )
    
    
    181
    
    
    
    2,816
    
    
    
    
    
    
    
    11,100OTHER:Interest expense
    
    
    7,741
    
    
    
    18
    
    
    
    
    
    
    
    506
    
    
    
    19
    
    
    
    198
    
    
    
    
    
    
    
    8,482Interest (income)
    
    
    (3
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (71
    )
    
    
    
    
    
    
    (74
    )Other (income)
expense, net
    
    
    528
    
    
    
    
    
    
    
    (276
    )
    
    
    
    
    
    
    (412
    )
    
    
    (298
    )
    
    
    
    
    
    
    (458
    )Net (gain) on
extinguishment of debt
    
    
    (23,226
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (23,226
    )Intercompany interest
and other
    
    
    (11,745
    )
    
    
    1,892
    
    
    
    5,488
    
    
    
    (510
    )
    
    
    1,446
    
    
    
    3,429
    
    
    
    
    
    
    
    (Profit) loss relating
to subsidiaries
    
    
    (5,627
    )
    
    
    
    
    
    
    
    
    
    
    532
    
    
    
    
    
    
    
    
    
    
    
    5,095
    
    
    
    INCOME (LOSS) FROM
CONTINUING OPERATIONS
BEFORE INCOME TAXES
    
    
    24,664
    
    
    
    368
    
    
    
    8,283
    
    
    
    (530
    )
    
    
    (872
    )
    
    
    (442
    )
    
    
    (5,095
    )
    
    
    26,376PROVISION (BENEFIT) FOR
INCOME TAXES
    
    
    1,951
    
    
    
    96
    
    
    
    672
    
    
    
    
    
    
    
    (340
    )
    
    
    1,284
    
    
    
    
    
    
    
    3,663INCOME (LOSS) FROM
CONTINUING OPERATIONS
    
    
    22,713
    
    
    
    272
    
    
    
    7,611
    
    
    
    (530
    )
    
    
    (532
    )
    
    
    (1,726
    )
    
    
    (5,095
    )
    
    
    22,713DISCONTINUED OPERATIONS:Profit (loss) relating to
discontinued operations
    
    
    (403
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    403
    
    
    
    (Loss) from discontinued
operations
(net of income taxes)
    
    
    
    
    
    
    (124
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (279
    )
    
    
    
    
    
    
    (403
    )Gain from disposal of
discontinued operations
(net of income taxes)
    
    
    231
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    231NET INCOME (LOSS)
    
    $
    22,541
    
    
    $
    148
    
    
    $
    7,611
    
    
    $
    (530
    )
    
    $
    (532
    )
    
    $
    (2,005
    )
    
    $
    (4,692
    )
    
    $
    22,541
 27




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##### Table of Contents



Parent
    
    
    Unrestricted
    
    
    U.S. Guarantor
    
    
    Dutch
    
    
    Belgium
    
    
    Non-Guarantor
    
    
    Consolidation
    
    
    ConsolidatedIssuer
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Issuer
    
    
    Guarantor
    
    
    Subsidiaries
    
    
    Adjustments
    
    
    BalanceOPERATING ACTIVITIES:Net income (loss)
    
    $
    22,541
    
    
    $
    148
    
    
    $
    7,611
    
    
    $
    (530
    )
    
    $
    (532
    )
    
    $
    (2,005
    )
    
    $
    (4,692
    )
    
    $
    22,541Adjustment for
discontinued operations
    
    
    172
    
    
    
    124
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    279
    
    
    
    (403
    )
    
    
    172Income (loss) from
continuing operations
    
    
    22,713
    
    
    
    272
    
    
    
    7,611
    
    
    
    (530
    )
    
    
    (532
    )
    
    
    (1,726
    )
    
    
    (5,095
    )
    
    
    22,713Adjustments to reconcile
income (loss) from
continuing operations
to net cash provided
(used) by operating
activities:Depreciation and
amortization
    
    
    948
    
    
    
    487
    
    
    
    1,248
    
    
    
    
    
    
    
    1,857
    
    
    
    2,004
    
    
    
    
    
    
    
    6,544Deferred income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    93
    
    
    
    
    
    
    
    93Net gain on
extinguishment of debt
    
    
    (23,226
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (23,226
    )Effects of changes in
foreign currency
    
    
    
    
    
    
    
    
    
    
    (198
    )
    
    
    
    
    
    
    (1,380
    )
    
    
    412
    
    
    
    
    
    
    
    (1,166
    )Other
    
    
    259
    
    
    
    
    
    
    
    423
    
    
    
    
    
    
    
    
    
    
    
    (93
    )
    
    
    
    
    
    
    589Changes in operating
assets and liabilities:Accounts receivable
    
    
    185
    
    
    
    329
    
    
    
    (3,590
    )
    
    
    
    
    
    
    308
    
    
    
    636
    
    
    
    
    
    
    
    (2,132
    )Inventory
    
    
    (330
    )
    
    
    (543
    )
    
    
    25
    
    
    
    
    
    
    
    (2,250
    )
    
    
    1,599
    
    
    
    
    
    
    
    (1,499
    )Prepaid expenses
and other
    
    
    1,340
    
    
    
    273
    
    
    
    (892
    )
    
    
    
    
    
    
    289
    
    
    
    (305
    )
    
    
    
    
    
    
    705Other assets
    
    
    605
    
    
    
    
    
    
    
    (4
    )
    
    
    
    
    
    
    
    
    
    
    4
    
    
    
    
    
    
    
    605Intercompany
    
    
    2,179
    
    
    
    16,879
    
    
    
    (13,879
    )
    
    
    (19,955
    )
    
    
    9,912
    
    
    
    (231
    )
    
    
    5,095
    
    
    
    Accounts payable
    
    
    (2,414
    )
    
    
    (337
    )
    
    
    366
    
    
    
    
    
    
    
    (2,647
    )
    
    
    (1,717
    )
    
    
    
    
    
    
    (6,749
    )Accrued expenses
and other
    
    
    2,076
    
    
    
    (128
    )
    
    
    5,515
    
    
    
    506
    
    
    
    3,647
    
    
    
    (7,100
    )
    
    
    
    
    
    
    4,516Cash provided (used)
by discontinued
operations
    
    
    231
    
    
    
    (652
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,244
    )
    
    
    
    
    
    
    (1,665
    )NET CASH PROVIDED
(USED) BY
OPERATING ACTIVITIES
    
    
    4,566
    
    
    
    16,580
    
    
    
    (3,375
    )
    
    
    (19,979
    )
    
    
    9,204
    
    
    
    (7,668
    )
    
    
    
    
    
    
    (672
    )INVESTING ACTIVITIES:Capital expenditures
    
    
    
    
    
    
    (62
    )
    
    
    (648
    )
    
    
    
    
    
    
    (659
    )
    
    
    (911
    )
    
    
    
    
    
    
    (2,280
    )Proceeds from sale of
assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23
    
    
    
    
    
    
    
    23Discontinued operations
    
    
    13,849
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    548
    
    
    
    
    
    
    
    14,397NET CASH PROVIDED
(USED) BY INVESTING
ACTIVITIES
    
    
    13,849
    
    
    
    (62
    )
    
    
    (648
    )
    
    
    
    
    
    
    (659
    )
    
    
    (340
    )
    
    
    
    
    
    
    12,140FINANCING ACTIVITIES:Net increase (decrease)
in cash overdraft
    
    
    (350
    )
    
    
    (286
    )
    
    
    2,849
    
    
    
    
    
    
    
    
    
    
    
    (9
    )
    
    
    
    
    
    
    2,204Net increase (decrease)
in short-term debt
    
    
    (32,194
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    741
    
    
    
    
    
    
    
    (31,453
    )Proceeds from long-term
debt
    
    
    85,000
    
    
    
    
    
    
    
    
    
    
    
    20,000
    
    
    
    
    
    
    
    2,500
    
    
    
    
    
    
    
    107,500Payments of long-term
debt
    
    
    (32,679
    )
    
    
    (13
    )
    
    
    (867
    )
    
    
    
    
    
    
    
    
    
    
    (461
    )
    
    
    
    
    
    
    (34,020
    )Payment of Pfizer
obligations
    
    
    (20,075
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8,225
    )
    
    
    
    
    
    
    
    
    
    
    (28,300
    )Payments relating
to the Prince
Transactions and
transaction costs
    
    
    (3,667
    )
    
    
    (16,312
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (19,979
    )Debt refinancing costs
    
    
    (11,496
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11,496
    )Discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,391
    
    
    
    
    
    
    
    1,391NET CASH PROVIDED
(USED) BY FINANCING
ACTIVITIES
    
    
    (15,461
    )
    
    
    (16,611
    )
    
    
    1,982
    
    
    
    20,000
    
    
    
    (8,225
    )
    
    
    4,162
    
    
    
    
    
    
    
    (14,153
    )EFFECT OF EXCHANGE RATE
CHANGES ON CASH
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    42
    
    
    
    146
    
    
    
    
    
    
    
    188NET INCREASE (DECREASE)
IN CASH AND
CASH EQUIVALENTS
    
    
    2,954
    
    
    
    (93
    )
    
    
    (2,041
    )
    
    
    21
    
    
    
    362
    
    
    
    (3,700
    )
    
    
    
    
    
    
    (2,497
    )CASH AND CASH EQUIVALENTS
at beginning of period
    
    
    43
    
    
    
    119
    
    
    
    2,167
    
    
    
    
    
    
    
    185
    
    
    
    8,665
    
    
    
    
    
    
    
    11,179CASH AND CASH EQUIVALENTS
at end of period
    
    $
    2,997
    
    
    $
    26
    
    
    $
    126
    
    
    $
    21
    
    
    $
    547
    
    
    $
    4,965
    
    
    $
    
    
    
    $
    8,682
 28




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29




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30




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31




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THREE MONTHS ENDED DECEMBER 31,
    
    SIX MONTHS ENDED DECEMBER 31,2004
    
    2003
    
    2004
    
    2003(THOUSANDS)
    
    (THOUSANDS)Net sales
    
    $
    93,060
    
    
    $
    92,540
    
    
    $
    181,335
    
    
    $
    177,490Gross profit
    
    
    13,869
    
    
    
    22,549
    
    
    
    36,491
    
    
    
    43,709Selling, general and administrative
    
    
    17,759
    
    
    
    16,824
    
    
    
    34,353
    
    
    
    32,609Operating income
    
    
    (3,890
    )
    
    
    5,725
    
    
    
    2,138
    
    
    
    11,100Interest expense, net
    
    
    5,356
    
    
    
    4,717
    
    
    
    10,577
    
    
    
    8,408Other expense (income), net
    
    
    (791
    )
    
    
    127
    
    
    
    (767
    )
    
    
    (458
    )Net (gain) on extinguishment of debt
    
    
    
    
    
    
    (23,226
    )
    
    
    
    
    
    
    (23,226
    )Provision (benefit) for income
taxes
    
    
    (884
    )
    
    
    2,880
    
    
    
    40
    
    
    
    3,663Income from continuing operations
    
    $
    (7,571
    )
    
    $
    21,227
    
    
    $
    (7,712
    )
    
    $
    22,713
      32




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33




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THREE MONTHS ENDED DECEMBER 31,
    
    
    SIX MONTHS ENDED DECEMBER 31,2004
    
    
    2003
    
    
    2004
    
    
    2003(THOUSANDS)
    
    
    (THOUSANDS)NET SALESAnimal Health & Nutrition
    
    $
    70,708
    
    
    $
    68,687
    
    
    $
    136,514
    
    
    $
    128,528Industrial Chemicals  ex PMC
    
    
    7,686
    
    
    
    6,244
    
    
    
    16,079
    
    
    
    12,543Industrial Chemicals  PMC
    
    
    
    
    
    
    5,435
    
    
    
    
    
    
    
    11,118Distribution
    
    
    8,104
    
    
    
    7,656
    
    
    
    15,765
    
    
    
    15,595All other
    
    
    6,562
    
    
    
    4,518
    
    
    
    12,977
    
    
    
    9,70693,060
    
    
    
    92,540
    
    
    $
    181,335
    
    
    $
    177,490
 THREE MONTHS ENDED DECEMBER 31,
    
    
    SIX MONTHS ENDED DECEMBER 31,2004
    
    
    2003
    
    
    2004
    
    
    2003(THOUSANDS)
    
    
    (THOUSANDS)OPERATING INCOMEAnimal Health & Nutrition
    
    $
    (1,520
    )
    
    $
    7,655
    
    
    $
    6,295
    
    
    $
    14,555Industrial Chemicals  ex PMC
    
    
    655
    
    
    
    (287
    )
    
    
    1,428
    
    
    
    (678
    )Industrial Chemicals  PMC
    
    
    
    
    
    
    1,065
    
    
    
    
    
    
    
    2,278Distribution
    
    
    796
    
    
    
    692
    
    
    
    1,660
    
    
    
    1,533All other
    
    
    455
    
    
    
    657
    
    
    
    1,160
    
    
    
    1,326Corporate expenses and adjustments
    
    
    (4,276
    )
    
    
    (4,057
    )
    
    
    (8,405
    )
    
    
    (7,914
    )$
    (3,890
    )
    
    $
    5,725
    
    
    $
    2,138
    
    
    $
    11,100
    34




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35




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THREE MONTHS ENDED DECEMBER 31, 2003MRT
    
    
    LACORNUBIA
    
    
    TOTALNet Sales
    
    $
    
    
    
    $
    3,503
    
    
    $
    3,503Operating Loss
    
    $
    
    
    
    $
    (108
    )
    
    $
    (108
    )Interest Expense, net
    
    
    
    
    
    
    26
    
    
    
    26Other Expense (Income), net
    
    
    
    
    
    
    (193
    )
    
    
    (193
    )Provision (benefit) for income tax
    
    
    
    
    
    
    
    
    
    
    Net Income (loss) from discontinued operations
    
    $
    
    
    
    $
    59
    
    
    $
    59Depreciation and Amortization
    
    $
    
    
    
    $
    101
    
    
    $
    101
 SIX MONTHS ENDED DECEMBER 31, 2003MRT
    
    
    LACORNUBIA
    
    
    TOTALNet Sales
    
    $
    3,327
    
    
    $
    5,723
    
    
    $
    9,050Operating Loss
    
    $
    (124
    )
    
    $
    (480
    )
    
    $
    (604
    )Interest Expense, net
    
    
    
    
    
    
    42
    
    
    
    42Other Expense (Income), net
    
    
    
    
    
    
    (243
    )
    
    
    (243
    )Provision (benefit) for income tax
    
    
    
    
    
    
    
    
    
    
    Net Income (loss) from discontinued operations
    
    $
    (124
    )
    
    $
    (279
    )
    
    $
    (403
    )Depreciation and Amortization
    
    $
    
    
    
    $
    201
    
    
    $
    201
   36




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37




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YEARSWITHIN 1
    
    
    OVER 1 TO 3
    
    
    OVER 3 TO 5
    
    
    OVER 5
    
    
    TOTALLoans payable to banks
    
    $
    0.3
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    0.3Long-term debt (including current portion)
    
    
    4.1
    
    
    
    129.8
    
    
    
    48.8
    
    
    
    
    
    
    
    182.7Interest payments
    
    
    22.3
    
    
    
    44.9
    
    
    
    2.4
    
    
    
    
    
    
    
    69.6Lease commitments
    
    
    1.4
    
    
    
    2.7
    
    
    
    2.0
    
    
    
    2.0
    
    
    
    8.1Acquisition of rights
    
    
    0.5
    
    
    
    0.7
    
    
    
    0.2
    
    
    
    
    
    
    
    1.4Total contractual obligations
    
    $
    28.6
    
    
    $
    178.1
    
    
    $
    53.4
    
    
    $
    2.0
    
    
    $
    262.1
    38




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##### Table of Contents



-
    
    our substantial leverage and potential inability to service our debt-
    
    our dependence on distributions from our subsidiaries-
    
    risks associated with our international operations and significant
foreign assets-
    
    our dependence on our Israeli operations
 39




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##### Table of Contents



-
    
    competition in each of our markets-
    
    potential environmental liability-
    
    potential legislation affecting the use of medicated feed additives-
    
    extensive regulation by numerous government authorities in the
United States and other countries-
    
    our reliance on the continued operation and sufficiency of our
manufacturing facilities-
    
    our reliance upon unpatented trade secrets-
    
    the risks of legal proceedings and general litigation expenses-
    
    potential operating hazards and uninsured risks-
    
    the risk of work stoppages-
    
    our dependence on key personnel
    
   
    40




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41




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##### Table of Contents



Exhibit No.
    
    Description10.33
    
    Purchase Agreement by and between Phibro Animal Health SA and
GlaxoSmithKline Biologicals SA, dated December 16, 2004.31.1
    
    Certification of Gerald K. Carlson, Chief Executive Officer
required by Rule 15d-14(a) of the Act.31.2
    
    Certification of Jack C. Bendheim, Chairman of the Board
required by Rule 15d-14(a) of the Act.31.3
    
    Certification of Richard G. Johnson, Chief Financial Officer
required by Rule 15d-14(a) of the Act.32
    
    Section 1350 Certifications of Phibro Animal Health
Corporation.
 42




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##### Table of Contents



PHIBRO ANIMAL HEALTH CORPORATION.Date: May 15, 2006
    
    
    
    By: /s/ JACK C. BENDHEIMJACK
C. BENDHEIMCHAIRMAN OF THE BOARDDate: May 15, 2006
    
    
    
    By: /s/ GERALD K. CARLSONGERALD K. CARLSONCHIEF EXECUTIVE OFFICERDate: May 15, 2006
    
    
    
    By: /s/ RICHARD G. JOHNSONRICHARD G. JOHNSONCHIEF FINANCIAL OFFICER(PRINCIPAL FINANCIAL OFFICER ANDPRINCIPAL ACCOUNTING OFFICER)
 43




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##### Table of Contents



Exhibit No.
    
    Description10.33
    
    Purchase Agreement by and between Phibro Animal Health SA and
GlaxoSmithKline Biologicals SA, dated December 16, 2004.31.1
    
    Certification of Gerald K. Carlson, Chief Executive Officer
required by Rule 15d-14(a) of the Act.31.2
    
    Certification of Jack C. Bendheim, Chairman of the Board
required by Rule 15d-14(a) of the Act.31.3
    
    Certification of Richard G. Johnson, Chief Financial Officer
required by Rule 15d-14(a) of the Act.32
    
    Section 1350 Certifications of Phibro Animal Health
Corporation.