The Toromont consolidated balance sheet reflects the transfer of various assets, liabilities and equity accounts to Enerflex as part of the arrangement. The underlying net assets representing the distribution of shares were as follows:
Assets Cash $ 44,452 Accounts receivable 222,737 Inventories 201,019 Property, plant and equipment 164,818 Rental equipment 114,180 Deferred tax assets 46,753 Intangible assets 29,208 Goodwill 482,656 Other current and non-current assets 31,329----------------------------------------------------------------------------Total assets 1,337,152----------------------------------------------------------------------------Liabilities Accounts payable, accrued liabilities and provisions 130,254 Deferred revenues 174,027 Other current and non-current liabilities 4,523 Notes payable to Toromont 173,300---------------------------------------------------------------------------- 482,104----------------------------------------------------------------------------Net assets transferred $ 855,048--------------------------------------------------------------------------------------------------------------------------------------------------------
Results from discontinued operations for 2011 were as follows:
2011----------------------------------------------------------------------------Revenues $ 492,937Net earnings before tax $ 20,783Income taxes $ 10,166Net earnings after tax $ 10,617Earnings (losses) attributable to :Common shareholders $ 11,240Non-controlling interests $ (623)
The Company followed IFRIC 17 - Distributions of Non-cash Assets to Owners in accounting for this transaction. In accordance with this guidance, a dividend of $1,006.2 million was recorded at the time of spinoff, based on the fair value of the distribution. The difference between the fair value of the dividend and the carrying value of the assets and liabilities of Enerflex ($151,179) was recognized as a gain in the consolidated income statement for the year ended December 31, 2011, less $18,015 related to historical currency translations of Enerflex's foreign operations.
26.ECONOMIC RELATIONSHIP
The Company, through its Equipment Group, sells and services heavy equipment and related parts. Distribution agreements are maintained with several equipment manufacturers, of which the most significant are with subsidiaries of Caterpillar Inc. The distribution and servicing of Caterpillar products account for the major portion of the Equipment Group's operations. Toromont has had a strong relationship with Caterpillar since 1993.
Contacts:
Toromont Industries Ltd.
Scott J. Medhurst
President and Chief Executive Officer
(416) 667-5623
Toromont Industries Ltd.
Paul R. Jewer
Executive Vice President and Chief Financial Officer
(416) 667-5638
www.toromont.com
