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/raid1/www/Hosts/bankrupt/TCR_Public/040911.mbx T R O U B L E D C O M P A N Y R E P O R T E R Saturday, September 11, 2004, Vol. 8, No. 195 Headlines DAN RIVER: Reports $5,065,000 Net Loss in July 2004 DII/KBR: DII's Net Loss Narrows to $97 Million in July 2004 DII/KBR: Mid-Valley's July 2004 Monthly Operating Report DII/KBR: Kellogg Brown & Root's July 2004 Monthly Operating Report DII/KBR: KBR Engineering's July 2004 Monthly Operating Report DII/KBR: KBR Technical's July 2004 Monthly Operating Report DII/KBR: KBR Int'l. Posts $2.9 Million Net Income for July 2004 DII/KBR: KBR (Panama)'s July 2004 Monthly Operating Report DII/KBR: BPM Minerals Reports $878,000 Net Income in July 2004 ENRON CORP: Files March 2004 Monthly Operating Report FEDERAL-MOGUL: Reports $18.6 Million Net Loss in July 2004 FORTUNE NATURAL: Net Loss Widens to $101,453 in July 2004 MED DIVERSIFIED: Reports July 2004 Monthly Operating Results PARMALAT: Finanziaria Releases July 2004 Financial Results PILLOWTEX: July 2004 Cash Receipts & Disbursement Report SPIEGEL: Net Loss Climbs to $12.8MM for Period Ended July 3, 2004 TRENWICK GROUP: Reports $2,012,356 Net Loss in July 2004 ********* DAN RIVER: Reports $5,065,000 Net Loss in July 2004 --------------------------------------------------- On September 7, 2004, Dan River Inc. filed its monthly operating report for July of fiscal 2004, which includes the period from July 4, 2004 to August 7, 2004, with the United States Bankruptcy Court for the Northern District of Georgia. The Company reports $5,065,000 net loss in $40,993,000 of net sales. A full-text copy of Dan River Inc.'s Monthly Financial Report for the period from July 4, 2004 to August 7, 2004, is available at no charge at: http://www.sec.gov/Archives/edgar/data/914384/000091438404000025/e9919704.txt Headquartered in Danville, Virginia, Dan River Inc. -- http://www.danriver.com/-- is a designer, manufacturer and marketer of textile products for the home fashions, apparel fabrics and industrial markets. The Company filed for chapter 11 protection on March 31, 2004 (Bankr. N.D. Ga. Case No. 04-10990). James A. Pardo, Jr., Esq., at King & Spalding represents the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $441,800,000 in total assets and $371,800,000 in total debts. DII/KBR: DII's Net Loss Narrows to $97 Million in July 2004 ----------------------------------------------------------- DII Industries, LLC Unaudited Balance Sheet As of July 31, 2004 (in thousands) Assets Current Assets: Cash and equivalents $104,720 Escrow - prepetition payments 142,849 Investment account with Parent 408,000 Trade receivables - Unbilled work on incomplete contracts - Other receivables 11 Inventories - Right to Halliburton Shares 1,849,617 Insurance for asbestos & silica-related PI claims 889,072 Other current assets 310,033 ---------- Total current assets 3,704,302 Net property, plant and equipment - Investments in consolidated subsidiaries 1,983,324 Equity in related companies - Intercompany with related companies (1,128,654) Goodwill, net - Non-current deferred income taxes 349,000 Insurance for asbestos & silica-related PI claims 468,449 Other assets 11 ---------- Total assets $5,376,432 ========== Liabilities and Shareholder's Equity Current Liabilities: Short-term notes payable - DIP Financing - Current maturities of long-term debt - Accounts payable $431 Accrued employee compensation and benefits 171 Accrued interest payable 7,768 Advanced billings on uncompleted contracts - Asbestos and silica-related PI claims 2,402,028 Other current liabilities 11,000 ---------- Total current liabilities 2,421,398 Long-term debt - Employee compensation and benefits - Asbestos and silica-related PI claims 1,856,267 Minority interest in consolidated subsidiaries - Other liabilities 5,224 ---------- Total liabilities 4,282,889 Total shareholder's equity 1,093,543 ---------- Total liabilities and shareholder's equity $5,376,432 ========== DII Industries, LLC Unaudited Income Statement Month ended July 31, 2004 (in thousands) Revenues - Operating costs and expenses $273 ---------- Operating income/(loss) (273) Interest expense - Interest income 4,921 Foreign currency gains (losses) 10 Other non-operating income - net - Equity in earnings/(loss) of subsidiaries (63,600) ---------- Income/(loss) before taxes & minority interest (58,942) Income tax benefit/(provision) (1,651) ---------- Income/(loss) from continuing operations (60,593) ---------- Income/(loss) from discontinued operations (36,395) ---------- Net Income/(loss) ($96,988) ========== DII/KBR: Mid-Valley's July 2004 Monthly Operating Report -------------------------------------------------------- Mid-Valley, Inc. Unaudited Balance Sheet As of July 31, 2004 (in thousands) Assets Current Assets: Cash and equivalents - Escrow - prepetition payments - Trade receivables - Unbilled work on uncompleted contracts - Other receivables - Inventories - Other current assets - ---------- Total current assets - Net property, plant and equipment - Investments in consolidated subsidiaries - Equity in related companies - Intercompany with related companies - Intercompany with Parent $40,378 Goodwill, net - Non-current deferred income taxes - Insurance for asbestos and silica-related PI claims - Right to Halliburton shares - Other assets 558 ---------- Total assets $40,936 ========== Liabilities and Shareholder's Equity Current Liabilities: Short-term notes payable - Current maturities of long-term debt - Accounts payable ($4) Accrued employee compensation and benefits 23 Accrued interest payable - Advanced billings on uncompleted contracts 532 Asbestos and silica-related PI claims - Other current liabilities 2,056 ---------- Total current liabilities 2,608 Long-term debt - Employee compensation and benefits - Asbestos and silica-related PI claims - Minority interest in consolidated subsidiaries - Other liabilities - ---------- Total liabilities 2,608 Total shareholder's equity 38,328 ---------- Total liabilities and shareholder's equity $40,936 ========== Mid-Valley, Inc., reports no income for July 2004. DII/KBR: Kellogg Brown & Root's July 2004 Monthly Operating Report ------------------------------------------------------------------ Kellogg Brown & Root, Inc. Unaudited Balance Sheet As of July 31, 2004 (in thousands) Assets Current Assets: Cash and equivalents ($23,584) Escrow - prepetition payments 117,076 Trade receivables 111,531 Unbilled work on uncompleted contracts 68,712 Other receivables 16,699 Inventories - Other current assets 22,248 ---------- Total current assets 312,682 Net property, plant and equipment 60,579 Investments in consolidated subsidiaries 248,679 Equity in related companies 14,915 Intercompany with related companies (55,741) Intercompany with Parent 590,335 Goodwill, net 171,213 Non-current deferred income taxes 209,000 Insurance for asbestos & silica-related PI claims - Right to Halliburton shares - Other assets 86,311 ---------- Total assets $1,637,973 ========== Liabilities and Shareholder's Equity Current Liabilities: Short-term notes payable - Current maturities of long-term debt - Accounts payable $88,333 Accrued employee compensation and benefits 53,441 Accrued interest payable - Advanced billings on uncompleted contracts 232,321 Asbestos and silica-related PI claims 74,337 Other current liabilities 372,710 ---------- Total current liabilities 821,142 Long-term debt - Employee compensation and benefits 52,882 Asbestos and silica-related PI claims - Minority interest in consolidated subsidiaries - Other liabilities 84,345 ---------- Total liabilities 958,369 Total shareholder's equity 679,604 ---------- Total liabilities and shareholder's equity $1,637,973 ========== Kellogg Brown & Root, Inc. Unaudited Income Statement Month ended July 31, 2004 (in thousands) Revenues $93,715 Operating costs and expenses 74,633 ---------- Operating income 19,082 Interest expense (2,571) Interest income 64 Foreign currency gains (losses) 919 Other non-operating income - net - ---------- Income before taxes and minority interest 17,494 Income tax benefit/(provision) (2,243) ---------- Income from continuing operations 15,251 ---------- Net Income $15,251 ========== DII/KBR: KBR Engineering's July 2004 Monthly Operating Report ------------------------------------------------------------- KBR Engineering Corp. Unaudited Balance Sheet As of July 31, 2004 (in thousands) Assets Current Assets: Cash and equivalents - Escrow - prepetition payments - Trade receivables - Unbilled work on uncompleted contracts - Other receivables - Inventories - Other current assets - ---------- Total current assets - Net property, plant and equipment - Investments in consolidated subsidiaries - Equity in related companies - Intercompany with related companies $77 Intercompany with Parent - Goodwill, net - Non-current deferred income taxes - Insurance for asbestos and silica-related PI claims - Right to Halliburton shares - Other assets - ---------- Total assets $77 ========== Liabilities and Shareholder's Equity Current Liabilities: Short-term notes payable - Current maturities of long-term debt - Accounts payable - Accrued employee compensation and benefits - Accrued interest payable - Advanced billings on uncompleted contracts - Asbestos and silica-related PI claims - Other current liabilities - ---------- Total current liabilities - Long-term debt - Employee compensation and benefits - Asbestos and silica-related PI claims - Minority interest in consolidated subsidiaries - Other liabilities - ---------- Total liabilities - Total shareholder's equity $77 ---------- Total liabilities and shareholder's equity $77 ========== KBR Engineering Corp. reports no income for July 2004. DII/KBR: KBR Technical's July 2004 Monthly Operating Report ----------------------------------------------------------- KBR Technical Services, Inc. Unaudited Balance Sheet As of July 31, 2004 (in thousands) Assets Current Assets: Cash and equivalents $301 Escrow - prepetition payments - Trade receivables - Unbilled work on uncompleted contracts - Other receivables 467 Inventories - Other current assets 886 ---------- Total current assets 1,654 Net property, plant and equipment 26,188 Investments in consolidated subsidiaries 1,555 Equity in related companies - Intercompany with related companies 11,581 Intercompany with Parent - Goodwill, net - Non-current deferred income taxes - Insurance for asbestos and silica-related PI claims - Right to Halliburton shares - Other assets - ---------- Total assets $40,978 ========== Liabilities and Shareholder's Equity Current Liabilities: Short-term notes payable - Current maturities of long-term debt - Accounts payable $5,237 Accrued employee compensation and benefits 19,049 Accrued interest payable - Advanced billings on uncompleted contracts - Asbestos and silica-related PI claims - Other current liabilities 584 ---------- Total current liabilities 24,870 Long-term debt - Employee compensation and benefits 2,637 Asbestos and silica-related PI claims - Minority interest in consolidated subsidiaries - Other liabilities - ---------- Total liabilities 27,507 Total shareholder's equity 13,471 ---------- Total liabilities and shareholder's equity $40,978 ========== KBR Technical Services, Inc. Unaudited Income Statement Month ended July 31, 2004 (in thousands) Revenues - Operating costs and expenses $644 ---------- Operating income/(loss) (644) Interest expense (140) Interest income - Foreign currency gains (losses) 1 Other non-operating income - net - ---------- Income/(loss) before taxes & minority interest (783) Income tax benefit - ---------- Net Income/(loss) ($783) ========== DII/KBR: KBR Int'l. Posts $2.9 Million Net Income for July 2004 --------------------------------------------------------------- KBR International, Inc. Unaudited Balance Sheet As of July 31, 2004 (in thousands) Assets Current Assets: Cash and equivalents $39,943 Escrow - prepetition payments - Trade receivables 18,668 Unbilled work on uncompleted contracts 19,824 Other receivables 19,570 Inventories - Other current assets 1,941 ---------- Total current assets 99,946 Net property, plant and equipment 354 Investments in consolidated subsidiaries 28,150 Equity in related companies 2,588 Intercompany with related companies - Intercompany with Parent (42,316) Goodwill, net - Non-current deferred income taxes - Insurance for asbestos and silica-related PI claims - Right to Halliburton shares - Other assets 488 ---------- Total assets $89,210 ========== Liabilities and Shareholder's Equity Current Liabilities: Short-term notes payable - Current maturities of long-term debt - Accounts payable $14,927 Accrued employee compensation and benefits 335 Accrued interest payable - Advanced billings on uncompleted contracts 14,289 Asbestos and silica-related PI claims - Other current liabilities 10,499 ---------- Total current liabilities 40,050 Long-term debt - Employee compensation and benefits 697 Asbestos and silica-related PI claims - Minority interest in consolidated subsidiaries - Other liabilities 212 ---------- Total liabilities 40,959 Total shareholder's equity 48,251 ---------- Total liabilities and shareholder's equity $89,210 ========== KBR International, Inc. Unaudited Income Statement Month ended July 31, 2004 (in thousands) Revenues $14,678 Operating costs and expenses 12,380 ---------- Operating income/(loss) 2,298 Interest expense - Interest income 1,134 Foreign currency gains (losses) 27 Other non-operating income - net - ---------- Income/(loss) before taxes & minority interest 3,459 Income tax benefit/(provision) (491) ---------- Net Income/(loss) $2,968 ========== DII/KBR: KBR (Panama)'s July 2004 Monthly Operating Report ---------------------------------------------------------- KBR International, Inc. (Panama) Unaudited Balance Sheet As of July 31, 2004 (in thousands) Assets Current Assets: Cash and equivalents $33,360 Escrow - prepetition payments - Trade receivables 2,525 Unbilled work on uncompleted contracts 5,718 Other receivables 277 Inventories - Other current assets 5,776 ---------- Total current assets 47,656 Net property, plant and equipment 1,033 Investments in consolidated subsidiaries 23,865 Equity in related companies - Intercompany with related companies - Intercompany with Parent (37,025) Goodwill, net - Non-current deferred income taxes - Insurance for asbestos and silica-related PI claims - Right to Halliburton shares - Other assets 16 ---------- Total assets $35,545 ========== Liabilities and Shareholder's Equity Current Liabilities: Short-term notes payable $462 Current maturities of long-term debt - Accounts payable 2,511 Accrued employee compensation and benefits 3,011 Accrued interest payable - Advanced billings on uncompleted contracts 370 Asbestos and silica-related PI claims - Other current liabilities 1,103 ---------- Total current liabilities 7,457 Long-term debt - Employee compensation and benefits 599 Asbestos and silica-related PI claims - Minority interest in consolidated subsidiaries - Other liabilities - ---------- Total liabilities 8,056 Total shareholder's equity 27,489 ---------- Total liabilities and shareholder's equity $35,545 ========== KBR International, Inc. (Panama) Unaudited Income Statement Month ended July 31, 2004 (in thousands) Revenues $4,347 Operating costs and expenses 2,893 ---------- Operating income/(loss) 1,454 Interest expense (23) Interest income 25 Foreign currency gains (losses) 26 Other non-operating income - net - ---------- Income/(loss) before taxes & minority interest 1,482 Provision for income tax - ---------- Net Income/(loss) $1,482 ========== DII/KBR: BPM Minerals Reports $878,000 Net Income in July 2004 -------------------------------------------------------------- BPM Minerals, LLC Unaudited Balance Sheet As of July 31, 2004 (in thousands) Assets Current Assets: Cash and equivalents ($288) Escrow - prepetition payments - Trade receivables 6,947 Unbilled work on uncompleted contracts - Other receivables 447 Inventories 6,724 Other current assets - ---------- Total current assets 13,830 Net property, plant and equipment 8,849 Investments in consolidated subsidiaries - Equity in related companies - Intercompany with related companies 45,302 Intercompany with Parent - Goodwill, net - Non-current deferred income taxes - Insurance for asbestos and silica-related PI claims - Right to Halliburton shares - Other assets - ---------- Total assets $67,980 ========== Liabilities and Shareholder's Equity Current Liabilities: Short-term notes payable - Current maturities of long-term debt - Accounts payable $666 Accrued employee compensation and benefits - Accrued interest payable - Advanced billings on uncompleted contracts - Asbestos and silica-related PI claims - Other current liabilities 87 ---------- Total current liabilities 753 Long-term debt - Employee compensation and benefits - Asbestos and silica-related PI claims 42,000 Minority interest in consolidated subsidiaries - Other liabilities 460 ---------- Total liabilities 43,213 Total shareholder's equity 24,767 ---------- Total liabilities and shareholder's equity $67,980 ========== BPM Minerals, LLC Unaudited Income Statement Month ended July 31, 2004 (in thousands) Revenues $5,429 Operating costs and expenses 4,551 ---------- Operating income 878 Interest expense - Interest income - Foreign currency gains (losses) - Other non-operating income - net - ---------- Income before taxes and minority interest 878 Provision for income tax - ---------- Net Income $878 ========== ENRON CORP: Files March 2004 Monthly Operating Report ----------------------------------------------------- On September 1, 2004, Enron Corp. and certain other debtors-in-possession subsidiaries of the Company filed their monthly operating report for March 2004 with the United States Bankruptcy Court for the Southern District of New York. A full-text copy of Enron Corp.'s March 2004 Monthly Operating Report is available at no charge at: http://www.sec.gov/Archives/edgar/data/1024401/000095012904006818/h18231exv99w1.txt Enron Corp. et al. Cash Activity Rollforward For the Month Ended March 31, 2004 Beginning cash $1,499,000,000 Third party receipts 265,000,000 Third party disbursements (95,000,000) Net Intercompany 41,000,000 Transfer from or to Restricted Cash 0 --------------- Ending balance $1,710,000,000 Enron Corp. et al. Tax Rollforward (Non-Payroll) For the Month Ended March 31, 2004 Beginning Balance $19,000,000 Accruals (32,000,000) Intercompany 37,000,000 Payments 0 --------------- Ending Balance $24,000,000 Enron Corp. et al. Receivables Rollforward - Non-Commodity For the Month Ended March 31, 2004 Beginning Balance $292,000,000 Billings 6,000,000 Payments Received (5,000,000) Other Adjustments 3,000,000 --------------- Ending Balance $296,000,000 Enron Corp. et al. Commodity Receivables and Payables For the Month Ended March 31, 2004 Receivables $411,000,000 Payables 655,000,000 Headquartered in Houston, Texas, Enron Corporation is in the midst of restructuring various businesses for distribution as ongoing companies to its creditors and liquidating its remaining operations. Before the company agreed to be acquired, controversy over accounting procedures had caused Enron's stock price and credit rating to drop sharply. The Company filed for chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01- 16033). Judge Gonzalez confirmed the Company's Modified Fifth Amended Plan on July 15, 2004, and numerous appeals followed. Martin J. Bienenstock, Esq., and Brian S. Rosen, Esq., at Weil, Gotshal & Manges, LLP, represent the Debtors in their restructuring efforts. (Enron Bankruptcy News, Issue No. 124; Bankruptcy Creditors' Service, Inc., 215/945-7000) FEDERAL-MOGUL: Reports $18.6 Million Net Loss in July 2004 ---------------------------------------------------------- Federal-Mogul Global, Inc., et al. Unaudited Balance Sheet As of July 31, 2004 (In millions) Assets Cash and equivalents $311.1 Accounts receivable 578.7 Inventories 484.4 Deferred taxes 199.7 Prepaid expenses and other current assets 115.0 ---------- Total current assets 1,688.9 Summary of Unpaid Postpetition Debits (77.6) Intercompany Loans Receivable (Payable) 2,462.1 ---------- Intercompany Balances 2,384.6 Property, plant and equipment 1,083.6 Goodwill 1,177.6 Other intangible assets 452.9 Insurance recoverable 817.0 Other non-current assets 1,099.1 ---------- Total Assets $8,703.6 ========== Liabilities and Shareholders' Equity Short-term debt $278.7 Accounts Payable 195.0 Accrued Compensation 69.2 Restructuring and rationalization reserves 16.3 Current portion of asbestos liability - Interest Payable 1.6 Other accrued liabilities 313.1 ---------- Total current liabilities 873.9 Long-term debt 25.0 Post-employment benefits 1,475.1 Other accrued liabilities 970.2 Liabilities subject to compromise 6,081.3 Shareholders' equity: Preferred stock 1,054.7 Common stock 555.4 Additional paid-in capital 7,937.3 Accumulated deficit (9,629.8) Accumulated other comprehensive income (639.3) ---------- Total Shareholders' Equity (721.8) ---------- Total Liabilities and Shareholders' Equity $8,703.7 ========== Federal-Mogul Global, Inc., et al. Unaudited Statement of Operations For the month ended July 31, 2004 (In millions) Net sales $252.1 Cost of products sold 217.5 ---------- Gross margin 34.6 Selling, general & administrative expenses (52.8) Amortization (1.2) Reorganization items (8.6) Interest income (expense), net (7.3) Other income (expense), net 16.9 ---------- Earnings before Income Taxes (18.4) Income Tax (Expense) Benefit (0.2) ---------- Earnings before effect of change in acctg principle (18.6) Cumulative effect of change in acctg principle - ---------- Net Earnings (loss) ($18.6) ========== Federal-Mogul Global, Inc., et al. Unaudited Statement of Cash Flows For the month ended July 31, 2004 (In millions) Cash Provided From (Used By) Operating Activities: Net earnings (loss) ($18.6) Adjustments to reconcile net earnings (loss): Depreciation and amortization 13.6 Adjustments of assets held for sale to fair value - Asbestos Charge - Summary of unpaid postpetition debits - Cumulative effect of change in acctg principle - Change in post-employment benefits (0.0) Decrease/(increase) in accounts receivable 23.6 Decrease/(increase) in inventories (18.4) Increase/(decrease) in accounts payable (3.2) Change in other assets and other liabilities (14.1) Change in restructuring charge (0.8) Refunds (payments) against asbestos liability - ---------- Net Cash Provided From Operating Activities (17.9) Cash Provided From (Used By) Investing Activities: Expenditures for property, plant & equipment (6.4) Proceeds from sale of property, plant & equipment - Proceeds from sale of businesses - Business acquisitions, net of cash acquired - Other - ---------- Net Cash Provided From (Used By) Investing Activities (6.4) Cash Provided From (Used By) Financing Activities: Increase (decrease) in debt 25.0 Sale of accounts receivable under securitization - Dividends - Other (2.0) ---------- Net Cash Provided From Financing Activities 23.0 Increase (Decrease) in Cash and Equivalents (1.3) Cash and equivalents at beginning of period 312.5 ---------- Cash and equivalents at end of period $311.1 ========== Headquartered in Southfield, Michigan, Federal-Mogul Corporation - - http://www.federal-mogul.com/-- is one of the world's largest automotive parts companies with worldwide revenue of some $6 billion. The Company filed for chapter 11 protection on Oct. 1, 2001 (Bankr. Del. Case No. 01-10582). Lawrence J. Nyhan, Esq., James F. Conlan, Esq., and Kevin T. Lantry, Esq., at Sidley Austin Brown & Wood and Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub, represent the Debtors in their restructuring efforts. When the Debtors filed for protection from its creditors, they listed $10.15 billion in assets and $8.86 billion in liabilities. (Federal-Mogul Bankruptcy News, Issue No. 63; Bankruptcy Creditors' Service, Inc., 215/945-7000) FORTUNE NATURAL: Net Loss Widens to $101,453 in July 2004 --------------------------------------------------------- Fortune Natural Resources Corporation filed its monthly operating report for July 2004 with the United States Bankruptcy Court for the Eastern District of Louisiana (Bankr. Case No. 04-14112) this week. Fortune's net loss widens to $101,453 in July 2004, compared to a $71,452 net loss in June 2004. The Debtor's July 31 balance sheet shows: Fortune Natural Resources Corporation Balance Sheet At July 31, 2004 Current Assets $133,043 Total Assets 5,958,924 Post-petition Liabilities 95,177 Total Liabilities 6,304,871 Total Equity (Net Worth) ($345,948) On June 1, 2004, Fortune Natural Resources Corporation filed a voluntary petition in the United Stated Bankruptcy Court, Eastern District of Louisiana, for relief under Chapter 11 of Title 11, U.S.C. Section 101- 1330. The Debtor continues to own its property and operate its business as a Debtor-in-Possession pursuant to Sections 1107 and 1108 of the Bankruptcy Code. No trustee or examiner has been appointed in this case. A full-text copy of Fortune Natural Resources Corporation's July 2004 Monthly Operating Report is available at no charge at: http://www.sec.gov/Archives/edgar/data/38242/000003824204000014/exh99_1.txt MED DIVERSIFIED: Reports July 2004 Monthly Operating Results ------------------------------------------------------------ Med Diversified, Inc., and its subsidiaries, Chartwell Diversified Services, Inc., Chartwell Community Services, Inc., Chartwell Care Givers, Inc., Resource Pharmacy, Inc., Trestle Corporation, Tender Loving Care Health Care Services, Inc. recently filed with the United States Bankruptcy Court for the Eastern District of New York its July 2004 Monthly Operating Reports. Med Diversified Inc.'s balance sheet shows: July 31, 2004 ------------- Total Assets $90,705,005 Post-petition Liabilities 4,632,336 Pre-petition Liabilities 128,743,509 Total Liabilities 133,375,845 Stockholders' Deficit 42,670,840 Full-text copies of Med Diversified, et al.'s July 2004 Monthly Operating Reports are available at no charge at: http://www.sec.gov/Archives/edgar/data/800181/000110465904026839/0001104659-04-026839-index.htm PARMALAT: Finanziaria Releases July 2004 Financial Results ----------------------------------------------------------- Parmalat Finanziaria SpA in Extraordinary Administration communicates the financial and economic results for the Parmalat Group as at July 31, 2004. A number of the non-Italian operations of the Group identified in previous months as being subject to "Special Proceedings" (for example USA Dairy, Brazil, Chile, EVH) and some financial companies (for example Parmalat Capital Finance) are currently subject to certain restrictions on their management as a result of the same local proceedings with the result that these operations are effectively outside of the control of Parmalat Finanziaria SpA in Extraordinary Administration. It has for this reason been decided to remove these businesses from the total consolidation area of the Group and to record them according to a net equity methodology. This will be the case while any eventual obligations Parmalat Finanziaria SpA in Extraordinary Administration may be found to have on the basis of legislation in force in the countries in which these businesses are headquartered, together with any guarantees to those that financed these companies, have been examined in greater detail and checked. More specifically: USA Dairy (Parmalat USA Corp., Farmland Dairies, Milk Products of Alabama) is the American business operating in the milk and milk related products sector and which is subject to Chapter 11 protection; for two Brazilian companies (Parmalat Brasil and Parmalat Partecipacoes) a local Concordata procedure has been agreed that also covers their subsidiary companies; the Chilean business is also subject to a local concordat procedure; EVH, a company incorporated in Canada, has been laced into liquidation; Parmalat Capital Finance has been placed into a procedure granting protection by the local court. This group of companies includes Eurofood IFSC, which is currently subject to a dispute with the Irish judicial authorities who contend that the Italian Extraordinary Administration proceedings do not apply to this company. As a consequence of taking account of the above, pro forma results for the revised consolidation relating to the previous financial year have been drawn up. It is these figures, set out in the following tables, that are comparable with the relevant results for the current year. FINANCIAL RESULTS Highlights (in EUR millions) Revenues -------------------------------- Previous Previous year Current year Pro-Forma year -------- ------------- ------- Core Activities 2,168.9 2,168.9 2,110.6 Non Core Activities 1,074.9 502.5 357.8 -------- ------------- ------- Total 3,243.7 2,671.3 2,468.4 ======== ============= ======= EBITDA -------------------------------- Previous Previous year Current year Pro-Forma year -------- ------------- ------- Core Activities 135.4 135.4 146.8 Non Core Activities (51.5) (29.7) (15.2) -------- ------------- ------- Total 83.9 105.7 131.5 ======== ============= ======= % of Revenues -------------------------------- Previous Previous year Current year Pro-Forma year -------- ------------- ------- Core Activities 6.2 6.2 7.0 Non Core Activities (4.8) (5.9) (4.3) -------- ------------- ------- Total 2.6 4.0 5.3 ======== ============= ======= * Core Activities: consist of drinks products (milk and fruit juice) and milk-based products, focused on approximately 30 brands ("global" brands or strong local brands), centered on high potential countries where there is strong demand for healthy lifestyle products, the willingness to recognize premium prices for the Parmalat brand and the availability of leading edge technology. * Non-core activities: these are countries and activities considered to be non-strategic that will be subject to divestment. Core Activities Parmalat's Core Activity revenues have generally held up well when compared to the same period in the previous year (EUR2,110.6 million compared to EUR2,168.9 million), while EBITDA improved by 8.4% to EUR146.8 million compared to EUR135.4 million for the same period in 2003. This improvement in operating results is largely due to initiatives of a commercial nature and thanks to operating and structural cost reduction measures. These results do not take account of the extraordinary costs relating to the Administration procedure of some EUR34 million for the period to date, since these relate only to the 2004 financial year. Revenues for the last month (the difference between the revenue figure reported for the end of July 2004 and that to the end of June 2004) were EUR325.8 million, while EBITDA was EUR22.2 million (6.8% of revenues), substantially maintained the improving trend of previous months. Specifically, looking at the Group's main geographical areas of operation, the following is evident: -- Italy Revenues for the period to the end of July reached EUR806.3 million, down 7.8% compared to the EUR874.1 million recorded in the same period in 2003. However, EBITDA improved by 11.5% moving from EUR50.4 million at 31 July 2003 to EUR56.2 million as at 31 July 2004. Revenues for the month of July were EUR114.3 million while EBITDA was EUR6.7 million (5.9% of revenues). The trend remains a positive one even if reduced in magnitude compared to the previous months as a result of a lower contribution from fruit juices compared to the same period of last year. This is as a result of the different weather conditions and to the seasonality of pasteurized milk, the level of whose sales falls in the summer months, all of which has translated into a lower contribution to results. It should also be noted that there has been an increase in the cost of some raw materials and a increased impact in percentage terms of fixed business costs (which remain unchanged in absolute terms compared to the previous year). Steps are under way in the second half of the year in order to reduce the level of these costs. -- Spain Revenues for the period were EUR136.7 million compared to the EUR139.5 million achieved as at 31 July 2003. EBITDA for the same period was down from EUR14.3 million to EUR10.3 million. Revenues for the month of July 2004 were EUR22.4 million while EBITDA reached EUR2.4 million (10.7% of revenues), an improvement on the trend of recent months. The factors underlying the decrease in EBITDA were an increase in the cost of milk, a lower contribution from the seasonally influenced Royne branded ice creams given the less clement weather conditions than were seen in the same period last year, as well as increased price competition and the launch of new products by competitors. -- South Africa Revenues as at 31 July 2004 of EUR135.2 million grew of 31.1% compared to the EUR103.2 million of the same period in 2003. EBITDA also grew significantly from EUR8.1 million to EUR10.6 million (+30.7%). This increase in profitability was principally due to the acquisition of new brands (Simonsberg) as well as to the appreciation of the South African Rand against the Euro (+8.2% compared to the same period of last year). Revenues for the month of July 2004 were EUR22.1 million and EBITDA for the month was EUR1.6 million (7.2% of revenues). The month was characterized particularly by a marked increase in sales volumes of low margin products. -- Venezuela Relative to the same period in 2003, the Venezuelan Bolivar has undergone a significant depreciation against the Euro (-25.2%), in part following to domestic political uncertainty. This, along with the absence of sufficient credit lines for the import of raw materials (powdered milk) and reduced sales volumes in fruit juices, led to a reduction in revenues which fell from EUR116 million as at 31 July 2003 to EUR87.2 million as the end of July 2004 (-24.8%) and, above all, the strong decrease in operating profitability which fell from EUR15.5 million to EUR2.4 million as a result of increased local raw material costs that were not balanced by a rise in retail pricing, and higher relative structural costs. Revenues for the month of July 2004 were EUR12.4 million and EBITDA was EUR300,000, without any issues of specific note for the period. -- Canada As seen in previous months the Canadian market maintained the slight growth trend of the previous months at the revenue level moving from EUR659.6 million to EUR668.4 million offsetting the slight depreciation of the Canadian dollar relative to the Euro (-2.5%). EBITDA of EUR42.9 million at the end of July 2004 improved of 4.2% compared to the same period in 2003 (EUR41.1 million). July 2004 volumes increased compared to the average volumes seen in the first half of 2004, with profitability remaining stable. Revenues for the month were EUR110.8 million while EBITDA was EUR7.3 million (6.6% of revenues). -- Australia In a context of a reduced average unit selling price, a favorable trend in the Australian dollar exchange rate (+6.3%) and an increase in volumes, revenues reached EUR220 million, up 4.4% compared to the EUR210.7 million of the same period in 2003. These same factors, together with a reduction in general and promotional expenses and improved raw materials purchasing, contributed to an improvement in EBITDA (EUR17.3 million for the period) compared to the EUR16.2 million in the same period in the previous year (+6.5%). Revenues for the month of July were EUR37.4 million, a strong increase on the average revenues of the first six months, while EBITDA of EUR3.5 million (9.4% of revenues), was also up on the previous month. Non-Core Activities Non-Core Activities registered a significant fall in revenues as at 31 July 2004 compared to the same period last year (EUR357.8 million compared to EUR502.5 million, down 28.8%) although EBITDA for the same businesses, while still heavily negative, showed an improvement at a negative EUR15.2 million compared to a negative EUR29.7 million for the same period in 2003. In July 2004 total sales were EUR49.5 million and EBITDA was a negative EUR2.7 million (a negative 5.5% of revenues). The strong reduction in losses compared to 2003 is principally linked to actions undertaken in Italy and at the US bakery operations. Italy The Non-Core activities of Parmalat SpA (consisting principally of businesses in the bakery, juice and tomato sectors) more than halved their losses for the period (from a negative EUR9.5 million to a negative EUR4.1 million) thanks principally to the suspension of the activities in the mineral water sector and a drastic reduction in promotional and advertising activities related to bakery and juices. In the same way greater attention to commercial expenses and reduced structural costs led to a reduction in losses at other Non-Core Italian businesses, falling from a negative EUR7 million in 2003 to a negative EUR2.7 million as at the end of July 2004. USA Bakery The US bakery activities, whilst experiencing a fall in revenues have seen a marked improvement in operating profitability (even if this still remains in negative territory, moving as it has from a negative EUR13 million in 2003 to a negative EUR5.4 million at the end of July 2004), this thanks to the reorganization and repositioning under way in the business. Heavily negative results have been recorded in Mexico where operations have been badly hit by the Group's financial crisis and the resulting impact on their operating performance. EBITDA has worsened from EUR500,000 at 31 July 2003 to a negative EUR2.4 million as at 31 July 2004. The assets of the Mexican business have, moreover, been divested during the month of July. NET FINANCIAL POSITION Highlights (in EUR millions) Situation Situation Situation Situation as at Pro-Forma as at as at as at 12/31/2003 12/31/2003 06/30/2004 07/31/2004 ---------- --------------- ---------- ---------- Short term financial assets (121.4) (104.7) (124.7) (125.2) of which: Liquidity financial assets (20.9) (20.9) (10.5) (10.4) Available liquidity (100.5) (83.8) (114.2) (114.8) Accruals on financial assets (incl. Interco.) (61.9) (57.2) (78.2) (76.6) ---------- --------------- ---------- ---------- Total short term financial assets (183.3) (161.9) (202.9) (201.8) ---------- --------------- ---------- ---------- Financial debts 13,457.5 11,402.6 11,409.6 11,447.7 Accruals on financial liabilities (incl. Interco.) 256.2 200.8 246.6 231.0 ---------- --------------- ---------- ---------- Total financial liabilities 13,713.7 11,603.4 11,656.2 11,678.7 Financial indebtedness/(Fully consolidated companies) 13,530.4 11,441.5 11,453.3 11,476.9 ---------- --------------- ---------- ---------- Financial indebtedness/net equity methodology evalued companies 132.0 2,220.9 2,523.7 2,523.7 ---------- --------------- ---------- ---------- Total financial indebtedness 13,662.4 13,662.4 13,977.0 14,000.6 ========== =============== ========== ========== Compared to the situation at 31 December 2003, the Group's net financial position as at 31 July 2004 shows the following characteristics: increased levels of liquidity, thanks largely to the attention paid to the management of available resources and to the disposal of Parmalat SpA's holdings in MCC SpA and Banca di Roma SpA and of Parmalat Finanziaria SpA's disposal of its holding in Fondo Alfieri. On the liability side there has been a small increase almost entirely resulting from a change in the rates of exchange between the Euro and currencies in countries outside Europe where the Group operates, from an increase in accruals for liabilities for interest and from an increase in the indebtedness of the Group's Canadian businesses. No use has been made until now of the line of credit of EUR105.8 million provided by a pool of banks on 4 March 2004. With reference to those companies that have been consolidated in their entirety, the net financial debt with third parties is divided as follows: (in EUR millions) Situation Situation Situation Pro-Forma as at as at as at 12/31/2003 06/30/2004 07/31/2004 --------------- ---------- ---------- Companies in EA subject to proposed composition with creditors 10,055.3 10,058.2 10,048.6 Other companies in EA 56.9 40.6 41.4 Other companies 1,329.3 1,354.5 1,386.9 Financial indebtedness/Total 11,441.5 11,453.3 11,476.9 =============== ========== ========== Companies in Extraordinary Administration The net indebtedness of these companies towards third parties, incurred prior to their entry into Extraordinary Administration, should be considered as being largely short-term in nature, given the current situation of default on the covenants underlying the financial contracts. Of particular note is the increased levels of liquidity at the companies subject to proposed Composition with Creditors, this having increased from EUR24 million as at 31 December 2003 to EUR68.5 million as at 31 July 2004; EUR19.4 million of this amount is subject to a restriction by a credit institution with regard to its use. Other Companies The remaining operating and financial companies not subject to the Procedure and totally consolidated, have net financial indebtedness towards third parties as at 31 December 2003 of EUR1,329.3 million, at 30 June 2004 of EUR1,354.5 million and at 31 July 2004 of EUR1,386.9 million. Of this amount EUR710.3 million is represented by debt of a medium or long term nature. A number of companies are currently in talks to renegotiate their debt in order to consolidate it. Among the companies which have already closed such agreements it should be noted that the Group's Canadian operating companies have finalized during the course of July the refinancing of their debt. This entailed a EUR43.7 million penalty for the early redemption of the previous debt as a result of the default situation. Following payment of this penalty new financing was put in place that will be repaid by 2012 and that has been included in the calculation of the Group's financial position as at 30 June of this year. The further increase in debt during the month of July also relates to the Canadian operations and derives from the repayment of a securitization of commercial credits and to the financing costs linked to the transaction, for a total amount of EUR32 million. Principal Companies in Extraordinary Administration The following tables summarize the situations of the principal Italian companies in Extraordinary Administration. Parmalat Finanziaria SpA (Values in millions of Euros) Situation Situation Situation Pro-Forma as at as at as at 12/31/2003 06/30/2004 07/31/2004 --------------- ---------- ---------- Short term financial assets (140.8) (139.9) (141.3) of which: Intercompany financial credits (138.8) (138.8) (138.8) Liquid financial assets (2.0) - - Available liquidity (0.0) (1.1) (2.5) Accruals on financial assets (incl. Interco.) (0.6) - - --------------- ---------- ---------- Total short term financial assets (141.4) (139.9) (141.3) --------------- ---------- ---------- Financial debt (incl. Intercompany debt) 1,269.9 1,272.9 1,274.4 of which: Intercompany financial debt 1,007.8 1,010.9 1,012.4 Other financial debt 262.1 262.0 262.0 Accruals on financial liabilities (incl. Interco.) 4.8 4.7 4.7 --------------- ---------- ---------- Total financial liabilities 1,274.7 1,277.6 1,279.1 --------------- ---------- ---------- Financial indebtedness/ (positive fin. Position) 1,133.3 1,137.7 1,137.8 =============== ========== ========== The net financial position of the company is substantially unchanged. The increase of EUR1.5 million in intercompany financial debt in the month of July 2004 compared to the month of June 2004 (which under financial assets can be seen in an increase in liquidity) relates to the granting of a loan by Parmalat SpA. Parmalat SpA (Values in millions of Euros) Situation Situation Situation Pro-Forma as at as at as at 12/31/2003 06/30/2004 07/31/2004 --------------- ---------- ---------- Short term financial assets (54.3) (61.3) (58.0) of which: Intercompany financial credits (28.0) (38.6) (38.3) Liquid financial assets (19.7) 0.0 0.0 Available liquidity (6.6) (22.7) (19.7) Accruals on financial assets (incl. Interco.) 0.0 0.0 0.0 --------------- ---------- ---------- Total short term financial assets (54.3) (61.3) (58.0) --------------- ---------- ---------- Financial debt (incl. Intercompany debt) 4,149.0 4,149.0 4,149.0 of which: Intercompany financial debt 1,266.2 1,266.2 1,266.2 Other financial debt 2,882.8 2,882.8 2,882.8 Accruals on financial liabilities (incl. Interco.) 0.0 0.0 0.0 --------------- ---------- ---------- Total financial liabilities 4,149.0 4,149.0 4,149.0 --------------- ---------- ---------- Financial indebtedness/ (positive fin. Position) 4,094.7 4,087.8 4,091.0 =============== ========== ========== The net financial position of Parmalat SpA is substantially unchanged. More specifically, compared to 31 December 2003, the financial resources of the company were positively effected by the divestment of the holdings in MCC SpA and Banca di Roma SpA. These divestments along with the performance of the operating business, generated new cash that permitted, above and beyond covering the ongoing requirements of the business, an increase in the total available liquidity (up from EUR6.6 million to EUR19.7 million) and the granting of inter-company credits of EUR22.4 million, principally in favor of units in North America (EUR10.7 million), Parmalat Finanziaria (EUR4.6 million), Parmalat Uruguay (EUR1.7 million) and units in Germany (EUR1.6 million) Finally it should be noted that during the course of July 2004 liquid resources decreased (from EUR22.7 million to EUR19.7 million) principally as a result of financing granted to other Group companies (EUR2.3 million). Eurolat SpA (Values in millions of Euros) Situation Situation Situation Pro-Forma as at as at as at 12/31/2003 06/30/2004 07/31/2004 --------------- ---------- ---------- Short term financial assets (13.6) (19.8) (17.8) of which: Intercompany financial credits 0.0 0.0 0.0 Liquid financial assets 0.0 0.0 0.0 Available liquidity (13.6) (19.8) (17.8) Accruals on financial assets (incl. Interco.) - (0.1) (0.1) --------------- ---------- ---------- Total short term financial assets (13.6) (19.9) (17.9) --------------- ---------- ---------- Financial debt (incl. Intercompany debt) 191.9 190.6 190.1 of which: Intercompany financial debt 45.8 45.8 45.8 Other financial debt 146.1 144.9 144.4 Accruals on financial liabilities (incl. Interco.) 1.5 - - --------------- ---------- ---------- Total financial liabilities 193.4 190.6 190.1 --------------- ---------- ---------- Financial indebtedness/ (positive fin. Position) 179.7 170.7 172.3 =============== ========== ========== This company also saw its debt position consolidated compared to the month of December 2003 having not had to seek new financing. The cash position at the end of the month of July produced a level of liquidity that was lower compared to the previous month as a result of having had to make supplier payments that were higher than the running average of previous months. Lactis SpA (Values in millions of Euros) Situation Situation Situation Pro-Forma as at as at as at 12/31/2003 06/30/2004 07/31/2004 --------------- ---------- ---------- Short term financial assets (0.4) (3.7) (3.7) of which: Intercompany financial credits - - - Liquid financial assets - - - Available liquidity (0.4) (3.7) (3.7) Accruals on financial assets (incl. Interco.) (0.0) (0.0) (0.0) --------------- ---------- ---------- Total short term financial assets (0.4) (3.8) (3.7) --------------- ---------- ---------- Financial debt (incl. Intercompany debt) 20.5 20.5 20.5 of which: Intercompany financial debt 8.6 8.6 8.6 Other financial debt 11.9 11.9 11.9 Accruals on financial liabilities (incl. Interco.) 0.0 0.0 0.0 --------------- ---------- ---------- Total financial liabilities 20.5 20.5 20.5 --------------- ---------- ---------- Financial indebtedness/ (positive fin. Position) 20.2 16.8 16.8 =============== ========== ========== Available liquidity grew from EUR400,000 to EUR3.7 million, while financial liabilities remained unchanged compared to 31 December 2003. Significant Events during July and August [Parmalat summarizes the principal events] that occurred during the course of July and in the month of August: 12 July Completion of the refinancing of the Group's Canadian subsidiaries 14 July Announcement of the recovery ratios in the proposed Composition with Creditors and publication of sections of the non-final version of the Group's Restructuring Plan. 19 July Publication of the economic and balance sheet positions of Parmalat SpA in Extraordinary Administration, Parmalat Finanziaria SpA in Extraordinary Administration and the consolidated figures for the Parmalat Group. With regard to the latter a brief report was also published covering the management of the Group as well as a report by the external auditors. 19 July Sale of the Assets of Parmalat De Mexico S.A. De CV and signing of licensing contracts for Parmalat brands. 21 July Establishment of the Parmalat Creditors Foundation by those Parmalat companies in Extraordinary Administration that are subject to the proposed Composition with Creditors. 22 July Initiation by the Competition Authorities in Italy of two cases against Parmalat relating to the failure to comply with conditions set out in 1999 relating to the authorization to require Eurolat from the Cirio Group (specifically the disposal of Newlat) and for the failure to communicate in advance the acquisition of a controlling position in Carnini. The actions that are the subject of the investigation are entirely attributable to the previous management of Parmalat. 23 July Authorization of the Parmalat Restructuring Plan by the Minister of Production Activities, Antonio Marzano, in agreement with the Minister for Agricultural and Forestry Affairs Gianni Alemanno. 26 July The acquisition by the Parmalat Creditors Foundation of the entire share capital of Parmalat SpA (formerly Cimabue S.r.l.). This company will become the third party Assumptor for the Composition with Creditors. 27 July The recognition of the legal validity of the Parmalat Creditors Foundation by the Prefecture of Parma. 29 July The announcement of an agreement, without the payment of any fine, by Parmalat Finanziaria SpA in Extraordinary Administration to settle the case bought before the New York Court by the Securities and Exchange Commission of the United States. 29 July The filing by the Extraordinary Commissioner of a complaint with the Superior Court of Bergen County in the State of New Jersey requesting that Citigroup Inc. and a number of its subsidiaries be required to pay damages. The Extraordinary Commissioner contends that the companies named in the action played an active part over an extended period of time in bringing about damages to the Parmalat Group which as at today are estimated to be a value of approximately US$10 billion. 30 July The admission into Extraordinary Administration, by decree of the Minister of Production Activities, of Streglio SpA and the appointment of Dr. Enrico Bondi as Extraordinary Commissioner of [Streglio SpA]. On 27 July 2004 Streglio SpA had requested insolvency status with the Civil Court of Parma. 6 August Request to the Court of Parma that UBS Limited be subject to a claw-back action following bankruptcy for an amount of EUR290 million plus interest. 9 August Request to the Court of Parma that Deutsche Bank SpA be subject to a claw-back action following bankruptcy for an amount of EUR17 million plus interest. 10 August Publication in a number of European daily newspapers of the decrees of the delegated Judge dated 3 August 2004 and 6 August 2004 relative to the proposed composition with Creditors and the summary Restructuring Plan for the Parmalat Group. The relevant press release was not distributed into the United States of America or other restricted territories. 11 August Notification to bond holders of the procedure to unblock their securities. As a consequence of this holders of such bonds are able to trade their securities. 13 August Approval by the local court in Brazil of the request for protection from creditors of Parmalat Brasil and Parmalat Partecipacoes as presented by Felsberg & Associates. 17 August Publication of a Notice relating to the registration as credits of Private Placements. This Notice makes clear that holders of Private Placements are required to request inclusion among the issuing company's creditors in order to have their status as creditors confirmed. 18 August The filing by the Extraordinary Commissioner of a complaint with the Circuit Court of Cook County in the State of Illinois requesting that the former external auditors of Parmalat, Grant Thornton International and Deloitte Touche Tohmatsu and their US and Italian subsidiaries be required to pay damages relating a series of accusations. The Extraordinary Commissioner asserts that the former external auditors played an absolutely central role in the causing of damages that overcame the Parmalat Group and in relation to this is requesting that the firms in questions be condemned to pay damages of no less than US$10 billion. 19 August Request to the Court of Parma that Credit Suisse First Boston International be subject to a claw-back action following bankruptcy for an amount of EUR248.3 million plus interest. PILLOWTEX: July 2004 Cash Receipts & Disbursement Report -------------------------------------------------------- Pillowtex, et al. Actual Cash Flow For the Month of July 2004 Accounts Receivable Collections $270,000 Brown & Joseph Fees (283,000) Brown & Joseph Personnel (16,000) Inventory Bulk Sales (6,000) Property Tax Related to Asset Sale (48,000) Property(Net) (65,000) Miscellaneous Proceeds (7,000) ----------- Total Proceeds (155,000) Prepetition Cure Cost of Capital Leases - Balance of 2003 Personal Property Tax - Alliance Street Production - Interest Expense(Term and Revolver) - Idle Facility Cost (432,000) Electric Demand Charge - Retail Store Operating Costs - Warehousing, Shipping & Billing 3,000 Freight & Duty - Manufacturing - Inventory Clean-up - Accrued Employee Expenses - Critical Vendor Payments - Continuing Medical - Terminated Medical - Workers' Compensation/Other Insurance 10,000 Corporate 114,000 Severance/Retention 120,000 Warehouse Vacation Pay - SB Capital Estate Charge Back - Early Termination Fee - DIP Fees - Professional Fees 998,000 Miscellaneous Expenses 64,000 ----------- Total Expenses 877,000 ----------- Net Cash Flow ($1,032,000) =========== Pillowtex, et al. Disbursement Report For the Month of July 2004 Net Payroll & Payroll Taxes Paid $343,263 Sales, Use & Other Taxes Paid 47,839 Inventory Purchases - Interest on Long Term Debt - Secured/Rental/Lease - Utilities 14,116 Insurance 9,877 Administrative 282,723 Professional Fees 1,034,979 U.S. Trustee's Fees - Others 84,062 ----------- Total for U.S. Trustee Fees $1,816,859 =========== Headquartered in Dallas, Texas, Pillowtex Corporation -- http://www.pillowtex.com/-- sold top-of-the-bed products to virtually every major retailer in the U.S. and Canada. The Company filed for Chapter 11 protection on November 14, 2000 (Bankr. Del. Case No. 00-4211), emerged from bankruptcy under a chapter 11 plan, and filed a second time on July 30, 2003 (Bankr. Del. Case No. 03-12339). The second chapter 11 filing triggered sales of substantially all of the Company's assets. David G. Heiman, Esq., at Jones Day, and William H. Sudell, Jr., Esq., at Morris Nichols Arsht & Tunnel, represent the Debtors. On July 30, 2003, the Company listed $548,003,000 in assets and $475,859,000 in debts. (Pillowtex Bankruptcy News, Issue No. 69; Bankruptcy Creditors' Service, Inc., 215/945-7000) SPIEGEL: Net Loss Climbs to $12.8MM for Period Ended July 3, 2004 ----------------------------------------------------------------- Spiegel, Inc., and Subsidiaries Debtors-in-Possession Unaudited Consolidated Balance Sheet As of July 3, 2004 ASSETS Current assets: Cash and cash equivalents $194,275,000 Receivables, net 46,270,000 Inventories 183,398,000 Prepaid expenses 44,294,000 Assets of discontinued operations 69,257,000 -------------- Total current assets 537,494,000 -------------- Property and equipment, net 170,143,000 Intangible assets, net 135,608,000 Other assets 27,055,000 -------------- Total assets $870,300,000 ============== LIABILITIES and STOCKHOLDERS' DEFICIT Liabilities not subject to compromise: Current liabilities: Accounts payable and accrued liabilities $235,270,000 Current portion of long-term debt 48,000,000 Liabilities of discontinued operations 85,919,000 -------------- Total current liabilities 369,189,000 -------------- Deferred lease obligation 11,323,000 Liabilities subject to compromise 1,439,882,000 Total liabilities 1,820,394,000 -------------- Stockholders' deficit: Class A non-voting common stock, $1.00 par value; authorized 16,000,000 shares; 14,945,144 shares issued and outstanding 14,945,000 Class B voting common stock, $1.00 par value; authorized 121,500,000 shares; 117,009,869 shares issued & outstanding 117,010,000 Additional paid-in capital 329,489,000 Accumulated other comprehensive loss (25,136,000) Accumulated deficit (1,386,402,000) -------------- Total stockholders' deficit (950,094,000) -------------- Total liabilities & stockholders' deficit $870,300,000 ============== Spiegel, Inc., and Subsidiaries Debtors-in-Possession Unaudited Consolidated Statement of Operations Five Weeks Ended July 3, 2004 Net sales and other revenues: Net sales $109,719,000 Other revenue 13,002,000 -------------- 122,721,000 Cost of sales and operating expenses: Cost of sales, including buying and occupancy expenses 62,274,000 Selling, general & administrative expenses 50,088,000 -------------- 112,362,000 Estimated loss of non-debtors (321,000) Operating Income 10,038,000 Interest expense 2,102,000 -------------- Income from operations before reorganization items 7,936,000 -------------- Reorganization items, net 16,073,000 Income Tax 3,145,000 -------------- Loss from operations (11,282,000) -------------- Discontinued operations: Loss from discontinued operations (1,522,000) -------------- Net loss ($12,804,000) ============== Spiegel, Inc., and Subsidiaries Debtors-in-Possession Unaudited Consolidated Statement of Cash Flows Five Weeks Ended July 3, 2004 Cash flows from operating activities: Net loss ($12,804,000) Adjustments to reconcile net loss to net cash used in operating activities: Reorganization items, net 16,073,000 Depreciation and amortization 5,098,000 Change in assets and liabilities: (Increase) decrease in receivables, net (2,907,000) (Increase) decrease in investments/advances 251,000 (Increase) decrease in inventories (4,371,000) (Increase) decrease in prepaid expenses (1,183,000) Increase (decrease) in accounts payable and other accrued liabilities (12,128,000) Increase (decrease) in net liabilities of discontinued operations 19,125,000 (Increase) decrease in refundable income taxes 1,863,000 -------------- Net cash provided by operating activities 9,017,000 -------------- Net cash used for reorganization items (3,638,000) Cash flows from investing activities: Net additions to property and equipment (2,342,000) Net reductions to other assets 96,000 -------------- Net cash provided by investing activities (2,246,000) -------------- Net cash provided by financing activities - -------------- Effect of exchange rate changes on cash 325,000 -------------- Net change in cash and cash equivalents 3,458,000 Cash & cash equivalents, beginning of period 190,817,000 -------------- Cash & cash equivalents, end of period $194,275,000 ============== Headquartered in Downers Grove, Illinois, Spiegel, Inc. -- http://www.spiegel.com/-- is a leading international general merchandise and specialty retailer that offers apparel, home furnishings and other merchandise through catalogs, e-commerce sites and approximately 560 retail stores. The Company filed for Chapter 11 protection on March 17, 2003 (Bankr. S.D.N.Y. Case No. 03-11540). James L. Garrity, Jr., Esq., and Marc B. Hankin, Esq., at Shearman & Sterling represent the Debtors in their restructuring efforts. When the Company filed for protection from its creditors, it listed $1,737,474,862 in assets and $1,706,761,176 in debts. (Spiegel Bankruptcy News, Issue No. 31; Bankruptcy Creditors' Service, Inc., 215/945-7000) TRENWICK GROUP: Reports $2,012,356 Net Loss in July 2004 -------------------------------------------------------- On August 20, 2004, Trenwick America Corporation, Trenwick Group Ltd. (in provisional liquidation) and LaSalle Re Holdings Limited (in provisional liquidation) filed monthly operating reports for the month ended July 31, 2004 and the period from August 20, 2003 to July 31, 2004 with the United States Bankruptcy Court for the District of Delaware. Trenwick Group Ltd. (Bankr. D. Del. Case No. 03-12636), reports a $2,012,356 net loss for the month ended July 2004, and a cumulative $88,879,795 loss for the period from August 20, 2003 to July 31, 2004. A full-text copy of Trenwick Group Ltd.'s July 2004 Monthly Operating Report is available at no charge at: http://www.sec.gov/Archives/edgar/data/1122211/000116923204004797/d60646_99-1.txt Trenwick America Corporation (Bankr. D. Del. Case No. 03-12635) reports a $554,780 net profit in July 2004 and a cumulative $60,770,122 loss during the course of its chapter 11 restructuring. A full-text copy of Trenwick America's July 2004 Monthly Operating Report is available at no charge at: http://www.sec.gov/Archives/edgar/data/1122211/000116923204004797/d60646_99-2.txt LaSalle Re Holdings Limited (Bankr. D. Del. Case No. 03-12637) reports a $2,854,662 net loss in July 2004 and a cumulative $6,693,744 post-petition loss. A full-text copy of LaSalle's July 2004 Monthly Operating Report is available at no charge at: http://www.sec.gov/Archives/edgar/data/1122211/000116923204004797/d60646_99-3.txt On August 20, 2003, TGL and LaSalle Re Holdings Limited (in provisional liquidation) filed insolvency proceedings in the Supreme Court of Bermuda. On August 22, 2003, the Bermuda Court granted an order appointing Michael Morrison and John Wardrop, partners of KPMG in Bermuda and KPMG LLP in the United Kingdom, respectfully, as Joint Provisional Liquidators in respect of TGL and LaSalle. The Bermuda Court granted the JPLs the power to oversee the continuation and reorganization of these companies' businesses under the control of their boards of directors and under the supervision of the Bankruptcy Court and the Bermuda Court. The JPLs have not audited the contents of this report. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. 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For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Yvonne L. Metzler, Emi Rose S.R. Parcon, Bernadette C. de Roda, Rizande B. Delos Santos, Jazel P. Laureno, Cherry Soriano-Baaclo, Marjorie Sabijon and Peter A. Chapman, Editors. Copyright 2004. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. 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