Form: 10-Q

Quarterly report pursuant to Section 13 or 15(d)

August 8, 2018

Exhibit 99

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES
RECONCILIATION OF ADJUSTED EBITDA (Unaudited)
(dollars in thousands)

EBITDA and Adjusted EBITDA are not measures made in accordance with U.S. generally accepted accounting principles (“GAAP”), and as such, should not be considered a measure of financial performance or condition, liquidity, or profitability. It should not be considered an alternative to GAAP-based net income or income from operations or operating cash flows. Further, because not all companies use identical calculations, amounts reflected by Hillman as EBITDA and Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Adjusted EBITDA is included to satisfy a reporting obligation under our indenture. Adjusted EBITDA as presented herein does not include certain adjustments and pro forma run rate measures contemplated by our senior secured credit facilities and our indenture and may also include additional adjustments that were not applicable at the time of the offering of the senior notes governed by our indenture. Adjusted EBITDA is also one of the performance criteria for the Company's annual performance-based bonus plan. The reconciliation of Net Income (Loss) to Adjusted EBITDA is presented below.

 
 
Thirteen Weeks Ended
Twenty-six Weeks Ended
 
 
June 30,
July 1,
June 30,
July 1,
 
 
2018
2017
2018
2017
Net income (loss)
 
$
(13,531
)
$
1,219

$
(23,848
)
$
(5,465
)
Income tax provision (benefit)
 
941

1,529

3,747

(4,221
)
Interest expense, net
 
14,361

12,696

27,932

25,173

Interest expense on junior subordinated debentures
 
3,152

3,152

6,304

6,304

Investment income on trust common securities
 
(94
)
(94
)
(189
)
(189
)
Depreciation
 
9,535

9,455

18,477

18,173

Amortization
 
9,712

9,470

19,435

18,942

EBITDA
 
24,076

37,427

51,858

58,717

 
 
 
 
 
 
   Stock compensation expense
 
505

955

992

1,553

   Management fees
 
134

130

262

263

   Acquisition and integration expense
 
2,368


2,462


   Non-recurring legal fees
 

65


65

   Restructuring and other costs (1)
 
3,667

657

6,513

4,268

   Refinancing costs
 
8,542


8,542


   Anti-dumping duties
 

1,796

(4,128
)
2,146

   Mark-to-market adjustment on interest rate swaps
 
(361
)
(207
)
(1,418
)
(666
)
Adjusted EBITDA
 
$
38,931

$
40,823

$
65,083

$
66,346




1.
Includes restructuring and other costs associated with the implementation of a new pricing program, restructuring our network of facilities in Canada, costs associated with relocating our distribution center in Dallas, TX, and start up costs for the hub facility located on the U.S. West Coast.