Spectrum Brands Holdings, Inc. (NYSE: SPB), a global and diversified
consumer products company with market-leading brands, today reported
record performance for fiscal 2014 ended September 30, 2014 with results
that met or exceeded financial targets. All but one of the Company’s
businesses achieved increased adjusted EBITDA in fiscal 2014. Continuous
improvement savings also reached a record annual amount. Fiscal 2014
free cash flow reached a record $359 million versus $254 million in
fiscal 2013.
The Company’s record fiscal 2014 results included growth in every
quarter of the year, including a fourth quarter highlighted by increases
in net sales, GAAP and adjusted earnings per share, and adjusted EBITDA.
Spectrum Brands said it expects to achieve a sixth consecutive year of
record net sales and profitability in fiscal 2015. The Company currently
expects to complete its acquisition of the IAMS and Eukanuba pet food
business in Europe from Procter & Gamble by early in the first quarter
of calendar 2015.
Fiscal 2014 Highlights:
-
Net sales of $4.43 billion in fiscal 2014 increased 8.4 percent
versus $4.09 billion a year ago; including HHI on a pro forma basis as
if part of the Company for all of fiscal 2013, net sales increased 3.5
percent and 3.7 percent excluding the negative impact of foreign
exchange. See Table 5 for a reconciliation of GAAP sales to pro forma
sales.
-
Net income of $214.1 million and diluted income per share of $4.02
in fiscal 2014 compared to a net loss of $55.2 million and diluted
loss per share of $1.06 in fiscal 2013, which was due primarily to
$122.2 million of costs and expenses related to the extinguishment of
$950 million of senior secured notes in the fourth quarter of fiscal
2013.
-
Adjusted diluted earnings per share, a non-GAAP measure, of $4.06
in fiscal 2014 increased 36.2 percent compared to $2.98 last year. See
Table 3 for a reconciliation to GAAP earnings per share.
-
Adjusted diluted earnings per share in the fourth quarter of fiscal
2014 increased 11.4 percent to $0.98 versus $0.88 a year earlier. See
Table 3 for a reconciliation to GAAP earnings per share.
-
Adjusted EBITDA, a non-GAAP measure, of $724.4 million in fiscal
2014 increased 7.0 percent versus $677.1 million in fiscal 2013, which
included HHI on a pro forma basis as if acquired at the beginning of
fiscal 2013. See Table 4 for a reconciliation to GAAP net income.
-
Adjusted EBITDA, a non-GAAP measure, of $186.8 million in the
fourth quarter of fiscal 2014 increased from $184.7 million last year,
which represented the 16th consecutive
quarter of year-over-year adjusted EBITDA growth. See Table 4 for a
reconciliation to GAAP net income.
-
Adjusted EBITDA margin, a non-GAAP measure, in fiscal 2014
increased to 16.4 percent versus 15.8 percent in fiscal 2013, which
represented the seventh consecutive year of adjusted EBITDA margin
improvement. See Table 4 for a reconciliation to GAAP net income.
-
Term debt was reduced by approximately $250 million in fiscal 2014,
which resulted in leverage (total debt to adjusted EBITDA) of
approximately 4.1 times at the end of fiscal 2014, consistent with
previous guidance.
-
Fiscal 2014 net cash provided from operating activities after
purchases of property, plant and equipment (free cash flow, a non-GAAP
measure) was $359 million in fiscal 2014 compared to $254 million in
fiscal 2013 and $208 million in fiscal 2012. See Table 6 for a
reconciliation to GAAP Cash Flow from Operating Activities.
“Fiscal 2014 was our fifth consecutive year of record performance,” said
Dave Lumley, Chief Executive Officer of Spectrum Brands Holdings. “We
delivered solid, consistent sales growth each quarter of about 3.5
percent. Adjusted EBITDA grew at twice the rate of sales, and gross and
adjusted EBITDA margins expanded. Free cash flow grew to a record $359
million, or nearly $7 per share, from $254 million, or nearly $5 per
share, in fiscal 2013. This performance was achieved despite a
challenging year for our Global Pet Supplies business.
“Fiscal 2014 cost improvement savings reached a record level,” Mr.
Lumley said, “reinforcing our focus on a lower cost structure, more than
offsetting higher product costs, and enabling us to invest in new
products, a number of which are launching now and throughout fiscal 2015.
“While our fourth quarter growth and leverage trajectory slowed from
earlier quarters, we posted improved results and met our fiscal 2014
financial goals,” he added. “Throughout 2014, we executed well in the
face of significant adversity that we are all too familiar with –
challenging global economies, sluggish spending by still cautious and
financially stretched consumers, tighter retailer inventory levels and
reorder rates, stagnant store traffic, unusual and disruptive weather
patterns, and increased competitor discounting and promotions in certain
of our businesses.
“Our Spectrum Value Model connects well with retailers and consumers in
this difficult global economy,” Mr. Lumley said. “Our ‘same or better
performance/less price,’ value-branded Spectrum Brands products are a
match for smart, value-focused shoppers and are well-positioned to
withstand erratic discounting by premium-priced products. Our brands are
largely non-discretionary, non-premium priced, home-related, replacement
packaged goods used daily by consumers.
“We see another year of record results in fiscal 2015,” he said. “And,
like many global companies, we are facing the reality of significant
foreign currency headwinds, predominantly the Euro but also across most
of our exposure spectrum. In addition, we are experiencing select
commodity cost pressures and continue to see disruptive pricing behavior
by some competitors who appear to be searching for growth through volume
in a world where value is winning.
“Our growth in fiscal 2015 will again come from a mix of new products
with better features, new retailers, distribution and market share
gains, cross-selling and e-commerce, supplemented by accretive, tuck-in
acquisitions such as Tell Manufacturing and the IAMS and Eukanuba
European pet food business,” Mr. Lumley said. “Our focus remains on
growing our adjusted EBITDA and maximizing sustainable free cash flow.
“To help us offset foreign currency and other cost pressures, we also
are moving to a more efficient global operating structure, combining our
Pet and Home and Garden businesses and our Batteries and Appliances
businesses into the PHG and GBA divisions, along with certain other
streamlining across the entire business,” Mr. Lumley said. “We
anticipate the cost savings from this two-year restructuring initiative
to have a one-year simple payback period.”
Fiscal 2014 Consolidated Financial Results
Consolidated net sales of $4.43 billion in fiscal 2014 increased 8.4
percent compared to $4.09 billion in fiscal 2013. The increase was the
result of the Hardware and Home Improvement Group (HHI) acquisition on
December 17, 2012 and higher revenues for the Home and Garden and
Batteries businesses. Including HHI on a pro forma basis as if part of
the Company for all of fiscal 2013, net sales of $4.43 billion increased
3.5 percent compared to $4.28 billion last year. See Table 5 for a
reconciliation of GAAP sales to pro forma sales.
Gross profit and gross profit margin for fiscal 2014 of $1.57 billion
and 35.4 percent, respectively, improved compared to $1.39 billion and
34.0 percent in fiscal 2013. All but one division contributed to the
gross profit margin improvement.
The Company reported GAAP net income of $214.1 million, or $4.02 diluted
income per share, in fiscal 2014 on average diluted shares and common
stock equivalents outstanding of 53.3 million. In fiscal 2013, the
Company reported a GAAP net loss of $55.2 million, or $1.06 diluted loss
per share, on average diluted shares and common stock equivalents
outstanding of 52.0 million. Adjusted for certain items in both fiscal
years, which are presented in Table 3 of this press release and which
management believes are not indicative of the Company’s ongoing
normalized operations, the Company generated adjusted diluted earnings
per share, a non-GAAP measure, of $4.06 in fiscal 2014, a 36.2 percent
increase compared to $2.98 in fiscal 2013.
Adjusted EBITDA, a non-GAAP measure, of $724.4 in fiscal 2014 increased
7.0 percent compared to $677.1 million in fiscal 2013, including HHI on
a pro forma basis as if part of the Company for all of fiscal 2013.
Virtually all divisions reported improved adjusted EBITDA
year-over-year. Adjusted EBITDA margin increased to 16.4 percent
compared to 15.8 percent last year, which represented the seventh
consecutive year of adjusted EBIDTA margin growth since fiscal 2007.
Adjusted EBITDA is a non-GAAP measurement of profitability which the
Company believes is a useful indicator of the operating health of the
business and its trends. See Table 4 for a reconciliation to GAAP net
income.
Fiscal 2014 Fourth Quarter Consolidated Financial Results
Consolidated net sales were $1.18 billion in the fourth quarter of
fiscal 2014, an increase of 3.6 percent compared to $1.14 billion a year
earlier. The improvement was the result of higher net sales in the
Company’s home and garden, HHI and battery businesses.
Gross profit and gross profit margin in the fourth quarter of fiscal
2014 were $411.0 million and 34.9 percent, respectively, compared to
$396.5 million and 34.9 percent, respectively, last year.
Spectrum Brands Holdings reported higher net income of $47.9 million, or
$0.90 diluted income per share, in the fourth quarter of fiscal 2014 on
average diluted shares and common stock equivalents outstanding of 53.4
million. In fiscal 2013, the Company reported a fourth quarter net loss
of $36.7 million, or $0.70 diluted loss per share, on average diluted
shares and common stock equivalents outstanding of 52.2 million.
Adjusted for certain items in both fiscal years, which are presented in
Table 3 of this press release and which management believes are not
indicative of the Company’s ongoing normalized operations, the Company
generated adjusted diluted earnings per share, a non-GAAP measure, of
$0.98 in the fourth quarter of fiscal 2014, an 11.4 percent increase
compared to $0.88 in the prior year.
Adjusted EBITDA of $186.8 million in the fourth quarter of fiscal 2014
increased from adjusted EBITDA of $184.7 million in fiscal 2013, and
represented the 16th consecutive quarter of year-over-year
adjusted EBITDA growth. The adjusted EBITDA margin was 15.9 percent
compared to 16.2 percent in the year-ago quarter. See Table 4 for a
reconciliation to GAAP net income.
Fiscal 2014 Fourth Quarter Segment Level Data
Global Batteries & Appliances
The Global Batteries & Appliances segment reported fiscal 2014 fourth
quarter net sales of $595.7 million, an increase of 3.2 percent versus
$577.3 million in the year-ago quarter. Higher battery and personal care
revenues drove the improvement.
Global battery net sales of $268.7 million in the fourth quarter of
fiscal 2014 improved 5.9 percent compared to $253.6 million in the
fourth quarter of fiscal 2013. North American alkaline battery growth
was driven by increases in a majority of all channels. In Europe, VARTA®
battery growth was attributable to retailer distribution gains and
promotions. Latin American battery revenues also increased.
Net sales for the global personal care product category of $129.4
million in the fourth quarter of fiscal 2014 increased 2.0 percent
versus $126.9 million last year. North America, Europe and the
Asia-Pacific regions posted improvements.
Net sales of $197.6 million in the global small appliances product
category in the fourth quarter of fiscal 2014 were essentially unchanged
compared to $196.8 million in the year-ago quarter. Higher European
revenues from new listings and market share gains were offset by modest
declines at several North American retailers.
With segment net income, as adjusted, of $61.4 million versus $54.8
million in the prior year, the Global Batteries & Appliances segment
reported adjusted EBITDA of $84.2 million in the fourth quarter of
fiscal 2014, an increase of 8.9 percent compared to adjusted EBITDA of
$77.3 million in the year-ago quarter. See Table 4 for a reconciliation
to GAAP net income.
Global Pet Supplies
The Global Pet Supplies segment reported net sales of $159.8 million in
the fourth quarter of fiscal 2014 compared to $165.2 million last year.
The decrease was attributable to lower aquatics sales in Europe and
Japan from ongoing category softness and the decline of the Japanese Yen
against the Euro, as well as a continuation of distribution challenges
in Russia which have prevented aquatics deliveries into that country.
Higher companion animal net sales in North America partially offset the
segment decline.
Segment net income, as adjusted, was $24.5 million in the fourth quarter
of fiscal 2014 versus $25.9 million in the fourth quarter of fiscal
2013. Fourth quarter adjusted EBITDA of $33.6 million decreased from
$35.8 million in fiscal 2013 due to the lower aquatics category sales,
including the effect of the Russian distribution challenges. See Table 4
for a reconciliation to GAAP net income.
Home and Garden
The Home and Garden segment reported record fourth quarter net sales of
$109.0 million, an increase of 7.5 percent compared to $101.4 million in
the fourth quarter of fiscal 2013. The improvement was due primarily to
higher net sales in the outdoor repellents category and, to a lesser
degree, the positive impact of the Liquid Fence animal repellents
acquisition completed on January 2, 2014. Also contributing to the
improvement were higher lawn and garden controls category sales driven
by the extended selling season.
The segment reported fiscal 2014 fourth quarter net income, as adjusted,
of $18.8 million versus $18.7 million in the prior year’s quarter.
Record fourth quarter adjusted EBITDA of $22.3 million compared to $21.8
million a year ago and was attributable to higher net sales as well as
the positive impact of the Liquid Fence acquisition. See Table 4 for a
reconciliation to GAAP net income.
The Home and Garden segment achieved record fiscal 2014 results. Net
sales of $431.9 million and adjusted EBITDA of $101.8 million grew 10.6
percent and 13.0 percent, respectively, in fiscal 2014 compared to
fiscal 2013. The fiscal 2014 adjusted EBITDA margin was a record 23.6
percent versus 23.1 percent in fiscal 2013. See Table 4 for a
reconciliation to GAAP net income.
Hardware & Home Improvement
The Hardware & Home Improvement (HHI) segment reported net sales of
$313.8 million in the fourth quarter of fiscal 2014, an increase of 6.8
percent compared to $293.8 million in the prior year’s quarter. The
revenue growth was primarily attributable to improvements in the U.S.
residential security category, as well as increases in both the retail
and non-retail sectors of the U.S. plumbing category. Excluding the
negative impact of foreign exchange, net sales increased 7.5 percent in
the fourth quarter of fiscal 2014.
The segment reported net income, as adjusted, of $41.2 million in the
fourth quarter of fiscal 2014 compared to $38.3 million in the prior
year’s fourth quarter. Adjusted EBITDA in the fourth quarter of fiscal
2014 increased to $55.3 million versus $54.4 million last year.
Excluding the negative impact of foreign exchange, adjusted EBITDA in
the fourth quarter of fiscal 2014 increased 4.2 percent. See Table 4 for
a reconciliation to GAAP net income.
Liquidity and Debt
The Company completed fiscal 2014 on September 30, 2014 with a solid
liquidity position, including a cash balance of approximately $195
million and zero cash drawn on its $400 million Asset Based Lending
facility.
As of the end of fiscal 2014, the Company had approximately $2,991
million of debt outstanding, consisting of a series of secured Term
Loans in the aggregate amount of $1,476 million, $520 million of 6.375%
senior unsecured notes, $570 million of 6.625% senior unsecured notes,
$300 million of 6.75% senior unsecured notes and approximately $125
million of capital leases and other obligations.
As a result of solid earnings and strong working capital management, the
Company generated record annual free cash flow in fiscal 2014 of $359
million, surpassing its goal of at least $350 million and its fiscal
2013 free cash flow of $254 million.
The Company made in excess of $250 million of payments on its term debt
during fiscal 2014. This resulted in leverage (total debt to adjusted
EBITDA) of approximately 4.1 times at the end of fiscal 2014, consistent
with previous guidance.
Fiscal 2015 Outlook
Spectrum Brands expects fiscal 2015 net sales, as reported, to increase
in the low to mid-single digit range compared to fiscal 2014 net sales
of $4.43 billion, including the positive impact of the acquisition of
Tell Manufacturing on October 1, 2014 and anticipated negative impacts
from foreign exchange of 1.5 percent to 2 percent.
Fiscal 2015 free cash flow is projected to be approximately $400
million. Fiscal 2015 free cash flow is expected to be negatively
impacted by foreign exchange, a modest increase in capital expenditures
and the newly announced restructuring plan. Capital expenditures, which
were $73 million in fiscal 2014, are expected to be in the range of $75
million to $85 million. These incremental investments are expected to
increase both the Company’s margin structure and accelerate its organic
sales growth rate in future years.
The Company also announced plans to transition to a more efficient
global operating structure during fiscal 2015, combining its Pet and
Home and Garden businesses and its Batteries and Appliances businesses
into the PHG and GBA divisions, respectively, along with other
streamlining moves across the Company. Cost savings from this
restructuring initiative are estimated to be realized over two years and
will have a one-year simple payback period.
Conference Call/Webcast Scheduled for 9:00 A.M. Eastern Time Today
Spectrum Brands will host an earnings conference call and webcast at
9:00 a.m. Eastern Time today, November 20. To access the live conference
call, U.S. participants may call 877-556-5260 and international
participants may call 973-532-4903. The conference ID number is
18320249. A live webcast and related presentation slides will be
available by visiting the Event Calendar page in the Investor Relations
section of Spectrum Brands’ website at www.spectrumbrands.com.
A replay of the live webcast also will be accessible through the Event
Calendar page in the Investor Relations section of the Company’s
website. A telephone replay of the conference call will be available
through Thursday, December 4. To access this replay, participants may
call 855-859-2056 and use the same conference ID number.
About Spectrum Brands Holdings, Inc.
Spectrum Brands Holdings, a member of the Russell 2000 Index, is a
global and diversified consumer products company and a leading supplier
of consumer batteries, residential locksets, residential builders’
hardware, faucets, shaving and grooming products, personal care
products, small household appliances, specialty pet supplies, lawn and
garden and home pest control products, and personal insect repellents.
Helping to meet the needs of consumers worldwide, our Company offers a
broad portfolio of market-leading, well-known and widely trusted brands
including Rayovac®, VARTA®, Kwikset®, Weiser®, Baldwin®, National
Hardware®, Pfister™, Remington®, George Foreman®, Black & Decker®,
Toastmaster®, Farberware®, Tetra®, Marineland®, Nature’s Miracle®,
Dingo®, 8-in-1®, FURminator®, Littermaid®, Spectracide®, Cutter®,
Repel®, Hot Shot®, Black Flag® and Liquid Fence®. Spectrum Brands'
products are sold by the world's top 25 retailers and are available in
more than one million stores in approximately 140 countries. Spectrum
Brands Holdings generated net sales of approximately $4.43 billion in
fiscal 2014. For more information, visit www.spectrumbrands.com.
Non-GAAP Measurements
Management believes that certain non-GAAP financial measures may be
useful in certain instances to provide additional meaningful comparisons
between current results and results in prior operating periods. Excluding
the impact of currency exchange rate fluctuations may provide additional
meaningful information about underlying business trends. In
addition, within this release, including the tables attached hereto,
reference is made to adjusted diluted earnings per share and adjusted
earnings before interest, taxes, depreciation and amortization (EBITDA).
See attached Table 3, “Reconciliation of GAAP Diluted Income (Loss)
Per Share to Adjusted Diluted Earnings Per Share,” for a complete
reconciliation of diluted earnings (loss) per share on a GAAP basis to
adjusted diluted earnings (loss) per share, and see attached Table 4,
“Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA,” for a
reconciliation of GAAP Net Income (Loss) to adjusted EBITDA for the
three months and twelve months ended September 30, 2014 versus
the three months and twelve months ended September 30, 2013. See
attached Table 6, “Reconciliation of Cash Flow from Operating Activities
to Free Cash Flow,” for a reconciliation of Net Cash provided from
Operating Activities for the twelve months ended September 30, 2014,
September 30, 2013 and September 30, 2012. See attached Table 7,
“Reconciliation of Forecasted Cash Flow from Operating Activities to
Forecasted Free Cash Flow,” for a reconciliation of Net Cash provided
from Operating Activities to Free Cash Flow for the twelve months ending
September 30, 2015. Adjusted EBITDA is a metric used by
management and frequently used by the financial community which provides
insight into an organization’s operating trends and facilitates
comparisons between peer companies, since interest, taxes, depreciation
and amortization can differ greatly between organizations as a result of
differing capital structures and tax strategies. Adjusted EBITDA also
can be a useful measure of a company’s ability to service debt and is
one of the measures used for determining the Company’s debt covenant
compliance. Adjusted EBITDA excludes certain items that are
unusual in nature or not comparable from period to period. In
addition, the Company’s management uses adjusted diluted earnings per
share as one means of analyzing the Company’s current and future
financial performance and identifying trends in its financial condition
and results of operations. Management believes that adjusted
diluted earnings per share is a useful measure for providing further
insight into our operating performance because it eliminates the effects
of certain items that are not comparable from one period to the next.
The Company’s management believes that free cash flow is useful to
both management and investors in their analysis of the Company’s ability
to service and repay its debt and meet its working capital requirements.
Free cash flow should not be considered in isolation or as a
substitute for pretax income (loss), net income (loss), cash provided by
(used in) operating activities or other statement of operations or cash
flow statement data prepared in accordance with GAAP or as a measure of
profitability or liquidity. In addition, the calculation of free
cash flow does not reflect cash used to service debt and therefore, does
not reflect funds available for investment or discretionary uses. The
Company provides this information to investors to assist in comparisons
of past, present and future operating results and to assist in
highlighting the results of on-going operations. While the
Company’s management believes that non-GAAP measurements are useful
supplemental information, such adjusted results are not intended to
replace the Company’s GAAP financial results and should be read in
conjunction with those GAAP results.
Forward-Looking Statements
Certain matters discussed in this news release and other oral and
written statements by representatives of the Company regarding matters
such as the Company’s ability to meet its expectations for its fiscal
2014 (including its ability to increase its net sales and adjusted
EBITDA) may be forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. We have tried,
whenever possible, to identify these statements by using words like
“future,” “anticipate”, “intend,” “plan,” “estimate,” “believe,”
“expect,” “project,” “forecast,” “could,” “would,” “should,” “will,”
“may,” and similar expressions of future intent or the negative of such
terms. These statements are subject to a number of risks and
uncertainties that could cause results to differ materially from those
anticipated as of the date of this release. Actual results may
differ materially as a result of (1) Spectrum Brands Holdings’ ability
to manage and otherwise comply with its covenants with respect to its
significant outstanding indebtedness, (2) our ability to integrate, and
to realize synergies from, the combined businesses of Spectrum Brands,
Procter & Gamble’s European pet product business, and other bolt-on
acquisitions, (3) risks related to changes and developments in external
competitive market factors, such as introduction of new product features
or technological developments, development of new competitors or
competitive brands or competitive promotional activity or spending, (4)
changes in consumer demand for the various types of products Spectrum
Brands Holdings offers, (5) unfavorable developments in the global
credit markets, (6) the impact of overall economic conditions on
consumer spending, (7) fluctuations in commodities prices, the costs or
availability of raw materials or terms and conditions available from
suppliers, (8) changes in the general economic conditions in countries
and regions where Spectrum Brands Holdings does business, such as stock
market prices, interest rates, currency exchange rates, inflation and
consumer spending, (9) Spectrum Brands Holdings’ ability to successfully
implement manufacturing, distribution and other cost efficiencies and to
continue to benefit from its cost-cutting initiatives, (10) Spectrum
Brands Holdings’ ability to identify, develop and retain key employees,
(11) unfavorable weather conditions and various other risks and
uncertainties, including those discussed herein and those set forth in
the securities filings of each of Spectrum Brands Holdings, Inc. and
Spectrum Brands, Inc., including each of their most recently filed
Annual Reports on Form 10-K or Quarterly Reports on Form 10-Q.
Spectrum Brands Holdings also cautions the reader that its estimates
of trends, market share, retail consumption of its products and reasons
for changes in such consumption are based solely on limited data
available to Spectrum Brands Holdings and management’s reasonable
assumptions about market conditions, and consequently may be inaccurate,
or may not reflect significant segments of the retail market. Spectrum
Brands Holdings also cautions the reader that undue reliance should not
be placed on any forward-looking statements, which speak only as of the
date of this release. Spectrum Brands Holdings undertakes no duty
or responsibility to update any of these forward-looking statements to
reflect events or circumstances after the date of this report or to
reflect actual outcomes.
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Table 1
|
|
SPECTRUM BRANDS HOLDINGS, INC.
|
|
Condensed Consolidated Statements of Operations
|
|
For the three and twelve months ended September 30, 2014 and
September 30, 2013
|
|
(Unaudited)
|
|
($ in millions, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
|
|
TWELVE MONTHS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
F2014
|
|
F2013
|
|
INC %
|
|
F2014
|
|
F2013
|
|
INC %
|
|
Net sales
|
|
$
|
1,178.3
|
|
$
|
1,137.7
|
|
3.6 %
|
|
$
|
4,429.1
|
|
$
|
4,085.6
|
|
8.4 %
|
|
Cost of goods sold
|
|
|
766.9
|
|
|
735.9
|
|
|
|
|
2,856.5
|
|
|
2,685.3
|
|
|
|
Restructuring and related charges
|
|
|
0.4
|
|
|
5.3
|
|
|
|
|
3.7
|
|
|
10.0
|
|
|
|
Gross profit
|
|
|
411.0
|
|
|
396.5
|
|
3.7 %
|
|
|
1,568.9
|
|
|
1,390.3
|
|
12.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling
|
|
|
176.4
|
|
|
172.0
|
|
|
|
|
678.2
|
|
|
637.0
|
|
|
|
General and administrative
|
|
|
94.3
|
|
|
88.8
|
|
|
|
|
321.6
|
|
|
286.4
|
|
|
|
Research and development
|
|
|
12.6
|
|
|
11.8
|
|
|
|
|
47.9
|
|
|
43.3
|
|
|
|
Acquisition and integration related charges
|
|
|
5.6
|
|
|
7.9
|
|
|
|
|
20.1
|
|
|
48.4
|
|
|
|
Restructuring and related charges
|
|
|
6.5
|
|
|
1.0
|
|
|
|
|
19.2
|
|
|
24.0
|
|
|
|
Total operating expenses
|
|
|
295.4
|
|
|
281.5
|
|
|
|
|
1,087.0
|
|
|
1,039.1
|
|
|
|
Operating income
|
|
|
115.6
|
|
|
115.0
|
|
|
|
|
481.9
|
|
|
351.2
|
|
|
|
Interest expense
|
|
|
50.4
|
|
|
183.9
|
|
|
|
|
202.1
|
|
|
375.6
|
|
|
|
Other expense (income), net
|
|
|
1.9
|
|
|
(4.5)
|
|
|
|
|
6.3
|
|
|
3.5
|
|
|
|
Income (loss) from continuing operations before income taxes
|
|
|
63.3
|
|
|
(64.4)
|
|
|
|
|
273.5
|
|
|
(27.9)
|
|
|
|
Income tax expense (benefit)
|
|
|
15.2
|
|
|
(27.6)
|
|
|
|
|
59.0
|
|
|
27.4
|
|
|
|
Net income (loss)
|
|
|
48.1
|
|
|
(36.8)
|
|
|
|
|
214.5
|
|
|
(55.3)
|
|
|
|
Less: Net income (loss) attributable to
non-controlling interest
|
|
|
0.2
|
|
|
(0.1)
|
|
|
|
|
0.4
|
|
|
(0.1)
|
|
|
|
Net income (loss) attributable to
controlling interest
|
|
$
|
47.9
|
|
$
|
(36.7)
|
|
|
|
$
|
214.1
|
|
$
|
(55.2)
|
|
|
|
Average shares outstanding (a)
|
|
|
52.7
|
|
|
52.2
|
|
|
|
|
52.6
|
|
|
52.0
|
|
|
|
Basic income (loss) per share attributable
to controlling interest
|
|
$
|
0.91
|
|
$
|
(0.70)
|
|
|
|
$
|
4.07
|
|
$
|
1.06
|
|
|
|
Average shares and common stock equivalents outstanding (a) (b)
|
|
53.4
|
|
|
52.2
|
|
|
|
|
53.3
|
|
|
52.0
|
|
|
|
Diluted income (loss) per share attributable
to controlling interest
|
|
$
|
0.90
|
|
$
|
(0.70)
|
|
|
|
$
|
4.02
|
|
$
|
(1.06)
|
|
|
|
Cash dividends declared per common share
|
|
$
|
0.30
|
|
$
|
0.25
|
|
|
|
$
|
1.15
|
|
$
|
0.75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Per share figures calculated prior to rounding.
|
|
(b) For the three and twelve months ended September 30, 2013, we
have not assumed the exercise of common stock equivalents as the
impact would be antidilutive.
|
|
|
|
Table 2
|
|
SPECTRUM BRANDS HOLDINGS, INC.
|
|
Supplemental Financial Data
|
|
As of and for the three and twelve months ended September 30,
2014 and September 30, 2013
|
|
(Unaudited)
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Financial Data
|
|
F2014
|
|
F2013
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
194.6
|
|
$
|
207.3
|
|
|
|
|
|
|
|
Trade receivables, net
|
|
$
|
439.0
|
|
$
|
481.3
|
|
|
|
|
|
|
|
Days Sales Outstanding (a)
|
|
|
31.0
|
|
|
36.0
|
|
|
|
|
|
|
|
Inventory
|
|
$
|
624.5
|
|
$
|
632.9
|
|
|
|
|
|
|
|
Inventory Turnover (b)
|
|
|
4.0
|
|
|
4.0
|
|
|
|
|
|
|
|
Total debt
|
|
$
|
2,997.1
|
|
$
|
3,218.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
|
|
TWELVE MONTHS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Cash Flow Data
|
|
F2014
|
|
F2013
|
|
F2014
|
|
F2013
|
|
Depreciation and amortization, excluding amortization of debt
issuance costs
|
|
$
|
59.3
|
|
$
|
51.0
|
|
$
|
204.5
|
|
$
|
183.7
|
|
Capital expenditures
|
|
$
|
22.4
|
|
$
|
36.8
|
|
$
|
73.3
|
|
$
|
82.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
|
|
TWELVE MONTHS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Segment Sales & Profitability
|
|
F2014
|
|
F2013
|
|
F2014
|
|
F2013
|
|
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global Batteries & Appliances
|
|
$
|
595.7
|
|
$
|
577.3
|
|
$
|
2,230.7
|
|
$
|
2,203.6
|
|
Global Pet Supplies
|
|
|
159.8
|
|
|
165.2
|
|
|
600.5
|
|
|
621.8
|
|
Home and Garden
|
|
|
109.0
|
|
|
101.4
|
|
|
431.9
|
|
|
390.5
|
|
Hardware & Home Improvement
|
|
|
313.8
|
|
|
293.8
|
|
|
1,166.0
|
|
|
869.6
|
|
Total net sales
|
|
$
|
1,178.3
|
|
$
|
1,137.7
|
|
$
|
4,429.1
|
|
$
|
4,085.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global Batteries & Appliances
|
|
$
|
66.0
|
|
$
|
55.8
|
|
$
|
256.6
|
|
$
|
237.5
|
|
Global Pet Supplies
|
|
|
25.8
|
|
|
28.3
|
|
|
82.4
|
|
|
91.1
|
|
Home and Garden
|
|
|
19.0
|
|
|
18.8
|
|
|
89.2
|
|
|
78.5
|
|
Hardware & Home Improvement
|
|
|
46.8
|
|
|
42.2
|
|
|
172.2
|
|
|
88.7
|
|
Total segment profit
|
|
|
157.6
|
|
|
145.1
|
|
|
600.4
|
|
|
495.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
29.5
|
|
|
15.9
|
|
|
75.5
|
|
|
62.2
|
|
Acquisition and integration related charges
|
|
|
5.6
|
|
|
7.9
|
|
|
20.1
|
|
|
48.4
|
|
Restructuring and related charges
|
|
|
6.9
|
|
|
6.3
|
|
|
22.9
|
|
|
34.0
|
|
Interest expense
|
|
|
50.4
|
|
|
183.9
|
|
|
202.1
|
|
|
375.6
|
|
Other expense (income), net
|
|
|
1.9
|
|
|
(4.5)
|
|
|
6.3
|
|
|
3.5
|
|
Income (loss) from continuing operations before income taxes
|
|
$
|
63.3
|
|
$
|
(64.4)
|
|
$
|
273.5
|
|
$
|
(27.9)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Reflects actual days sales outstanding at end of period.
|
|
(b) Reflects cost of sales (excluding restructuring and related
charges) during the last twelve months divided by average inventory
during the period.
|
|
|
|
Table 3
|
|
SPECTRUM BRANDS HOLDINGS, INC.
|
|
Reconciliation of GAAP Diluted Income (Loss) Per Share to
Adjusted Diluted Earnings Per Share
|
|
For the three and twelve months ended September 30, 2014 and
September 30, 2013
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
|
|
TWELVE MONTHS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
F2014
|
|
F2013
|
|
F2014
|
|
F2013
|
|
Diluted income (loss) per share, as reported
|
|
$
|
0.90
|
|
|
|
$
|
(0.70
|
)
|
|
|
$
|
4.02
|
|
|
|
$
|
(1.06
|
)
|
|
|
Adjustments, net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-acquisition earnings of HHI
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
0.06
|
|
(a)
|
|
Acquisition and integration related charges
|
|
|
0.07
|
|
(b)
|
|
|
0.10
|
|
(c)
|
|
|
0.24
|
|
(d)
|
|
|
0.59
|
|
(e)
|
|
Restructuring and related charges
|
|
|
0.08
|
|
(f)
|
|
|
0.08
|
|
(g)
|
|
|
0.28
|
|
(f)
|
|
|
0.42
|
|
(g)
|
|
Debt refinancing costs
|
|
|
—
|
|
|
|
|
1.49
|
|
(h)
|
|
|
0.14
|
|
(i)
|
|
|
1.85
|
|
(j)
|
|
Purchase accounting inventory adjustment
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
0.38
|
|
(k)
|
|
Income taxes
|
|
|
(0.13
|
)
|
(l)
|
|
|
(0.09
|
)
|
(m)
|
|
|
(0.69
|
)
|
(l)
|
|
|
0.70
|
|
(m)
|
|
Share dilution assumption
|
|
|
—
|
|
|
|
|
—
|
|
(n)
|
|
|
—
|
|
|
|
|
0.02
|
|
(n)
|
|
Other
|
|
|
0.06
|
|
(o)
|
|
|
—
|
|
|
|
|
0.07
|
|
(o)
|
|
|
0.02
|
|
(p)
|
|
|
|
|
0.08
|
|
|
|
|
1.58
|
|
|
|
|
0.04
|
|
|
|
|
4.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted income per share, as adjusted
|
|
$
|
0.98
|
|
|
|
$
|
0.88
|
|
|
|
$
|
4.06
|
|
|
|
$
|
2.98
|
|
|
|
(a) For the twelve months ended September 30, 2013 reflects $3.2
million, net of tax, of pre-acquisition earnings related to the
acquired HHI business. The Pre-acquisition earnings of HHI do not
include the TLM Business as stand alone financial data is not
available for the period presented. The TLM Business is not deemed
material to the Company's operating results.
|
|
(b) For the three months ended September 30, 2014, reflects $3.7
million, net of tax, of acquisition and integration related charges,
as follows: (i) $(0.1) million related to the acquisition of the HHI
Business, consisting primarily of adjustments to previously accrued
integration costs; (ii) $0.7 million related to the acquisition of
Liquid Fence, consisting primarily of legal and professional fees;
(iii) $0.1 million related to the acquisition of Shaser; and (iv)
$3.0 million related to other adjustments.
|
|
(c) For the three months ended September 30, 2013, reflects $5.1
million, net of tax, of acquisition and integration related charges,
as follows: (i) $3.8 million related to the acquisition of the HHI
Business, consisting primarily of legal and professional fees; (ii)
$0.5 million related to the acquisition of FURminator, consisting of
integration costs; (iii) $0.5 million related to the merger with
Russell Hobbs, consisting of integration costs; and (iv) $0.3
million related to the acquisition of Shaser and other acquisition
activity, consisting of legal and professional fees.
|
|
(d) For the twelve months ended September 30, 2014, reflects $13.1
million, net of tax, of acquisition and integration related charges,
as follows: (i) $7.2 million related to the acquisition of the HHI
Business, consisting primarily of integration costs; (ii) $2.3
million related to the acquisition of Liquid Fence, consisting
primarily of legal and professional fees; (iii) $0.6 million related
to the acquisition of Shaser; and (iv) $3.0 million related to other
adjustments.
|
|
(e) For the twelve months ended September 30, 2013, reflects $31.5
million, net of tax, of acquisition and integration related charges,
as follows: (i) $24.0 million related to the acquisition of the HHI
Business, consisting primarily of legal and professional fees; (ii)
$3.1 million related to the acquisition of Shaser, consisting of
integration and legal and professional fees; (iii) $2.4 million
related to the merger with Russell Hobbs, consisting of integration
costs; and (iv) $1.9 million related to the acquisition of
FURminator and other acquisition activity, consisting of integration
costs.
|
|
(f) For the three and twelve months ended September 30, 2014,
reflects $4.3 million and $14.7 million, net of tax, respectively,
of restructuring and related charges primarily related to the Global
Expense Rationalization Initiatives announced in Fiscal 2013.
|
|
(g) For the three and twelve months ended September 30, 2013,
reflects $4.1 million and $22.1 million, net of tax, respectively,
of restructuring and related charges primarily related to the Global
Cost Rationalization Initiatives announced in Fiscal 2013 and the
Global Cost Reduction Initiatives announced in Fiscal 2009.
|
|
(h) For the three months ended September 30, 2013, reflects $79.4
million, net of tax, related to financing fees and the write off of
unamortized debt issuance costs in connection with the refinancing
of the Company's 9.5% Notes.
|
|
(i) For the twelve months ended September 30, 2014, reflects $7.3
million, net of tax, related to financing fees and the write off of
unamortized debt issuance costs in connection with the replacement
of the Company's Term Loan.
|
|
(j) For the twelve months ended September 30, 2013, reflects $98.2
million, net of tax, related to financing fees and the write off of
unamortized debt issuance costs in connection with the
extinguishment of the Company's 9.5% Notes and the replacement of
the Company's Term Loan and expenses related to the issuance of the
6.375% Notes and 6.625% Notes in connection with the acquisition of
the HHI Business.
|
|
(k) For the twelve months ended September 30, 2013, reflects a $20.2
million, net of tax, non-cash increase to cost of goods sold related
to the sales of inventory that was subject to fair value adjustments
in conjunction with the acquisition of the HHI Business.
|
|
(l) For the three and twelve months ended September 30, 2014,
reflects adjustments to income tax expense of $(7.0) million and
$(36.7) million, respectively, to exclude the impact of adjusting
the valuation allowance against deferred taxes and other tax related
items in order to reflect a normalized ongoing effective tax rate.
|
|
(m) For the three and twelve months ended September 30,2013,
reflects adjustments to income tax expense of $(5.0) million and
$37.1 million, respectively, to exclude the impact of the valuation
allowance against deferred taxes and other tax related items in
order to reflect a normalized ongoing effective tax rate.
|
|
(n) Adjustment to reflect the fully diluted net income per share, as
adjusted. The US GAAP diluted net loss per share calculation does
not take into account the dilutive impact of common stock
equivalents as these would be antidilutive given the net loss
reported. Therefore the diluted net loss per share is decreased when
the dilutive impact of common stock equivalents are taken into
consideration. Full dilution is used for this calculation as a
result of the adjusted net income.
|
|
(o) For the three and twelve months ended September 30,2014,
reflects adjustments of $3.1 million and $3.5 million, net of tax,
respectively, for costs related to a key executive onboarding and
the accelerated amortization of stock compensation related to a
retention agreement entered into with another key executive.
|
|
(p) For the twelve months ended September 30, 2013, reflects an
adjustment of $1.3 million, net of tax, related to the devaluation
of the Venezuelan Bolivar Fuerte.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 4
|
|
SPECTRUM BRANDS HOLDINGS, INC.
|
|
Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA
|
|
For the three months ended September 30, 2014
|
|
(Unaudited)
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global
Batteries &
Appliances
|
|
Global Pet
Supplies
|
|
Home &
Garden
|
|
Hardware &
Home
Improvement
|
|
Corporate /
Unallocated
Items (a)
|
|
Consolidated
Spectrum
Brands
Holdings, Inc.
|
|
Net income (loss) attributable to controlling interest, as adjusted
(a)
|
|
$
|
61.5
|
|
$
|
24.5
|
|
$
|
18.8
|
|
$
|
40.9
|
|
$
|
(97.8)
|
|
$
|
47.9
|
|
Net (income) loss attributable to non-controlling interest
|
|
(0.1)
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
0.2
|
|
Net income (loss), as adjusted (a)
|
|
|
61.4
|
|
|
24.5
|
|
|
18.8
|
|
|
41.2
|
|
|
(97.8)
|
|
|
48.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15.2
|
|
|
15.2
|
|
Interest expense
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
50.4
|
|
|
50.4
|
|
Acquisition and integration related charges
|
|
|
1.9
|
|
|
—
|
|
|
0.2
|
|
|
0.4
|
|
|
3.1
|
|
|
5.6
|
|
Restructuring and related charges
|
|
|
1.2
|
|
|
1.2
|
|
|
—
|
|
|
4.6
|
|
|
(0.1)
|
|
|
6.9
|
|
Other (b)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.3
|
|
|
1.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT
|
|
|
64.5
|
|
|
25.7
|
|
|
19.0
|
|
|
46.2
|
|
|
(27.9)
|
|
|
127.5
|
|
Depreciation and amortization (c)
|
|
|
19.7
|
|
|
7.9
|
|
|
3.3
|
|
|
9.1
|
|
|
19.3
|
|
|
59.3
|
|
Adjusted EBITDA
|
|
$
|
84.2
|
|
$
|
33.6
|
|
$
|
22.3
|
|
$
|
55.3
|
|
$
|
(8.6)
|
|
$
|
186.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Amounts calculated prior to rounding.
|
|
(a) It is the Company's policy to record Income tax expense and
Interest expense on a consolidated basis. Accordingly, such amounts
are not reflected in the results of the operating segments and are
presented within Corporate/Unallocated Items.
|
|
(b) Other relates to onboarding costs for a key executive.
|
|
(c) Included within depreciation and amortization is amortization of
stock based compensation.
|
|
|
|
|
|
|
|
|
|
Table 4
|
|
SPECTRUM BRANDS HOLDINGS, INC.
|
|
Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA
|
|
For the year ended September 30, 2014
|
|
(Unaudited)
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global
Batteries &
Appliances
|
|
Global Pet
Supplies
|
|
Home &
Garden
|
|
Hardware &
Home
Improvement
|
|
Corporate /
Unallocated
Items (a)
|
|
Consolidated
Spectrum
Brands
Holdings, Inc.
|
|
Net income (loss) attributable to controlling interest, as adjusted
(a)
|
|
$
|
235.1
|
|
$
|
78.7
|
|
$
|
88.1
|
|
$
|
156.3
|
|
$
|
(344.1)
|
|
$
|
214.1
|
|
Net (income) loss attributable to non-controlling interest
|
|
(0.5)
|
|
|
—
|
|
|
—
|
|
|
0.9
|
|
|
—
|
|
|
0.4
|
|
Net income (loss), as adjusted (a)
|
|
|
234.6
|
|
|
78.7
|
|
|
88.1
|
|
|
157.2
|
|
|
(344.1)
|
|
|
214.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59.0
|
|
|
59.0
|
|
Interest expense
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
202.1
|
|
|
202.1
|
|
Acquisition and integration related charges
|
|
|
7.8
|
|
|
—
|
|
|
1.1
|
|
|
4.4
|
|
|
6.8
|
|
|
20.1
|
|
Restructuring and related charges
|
|
|
11.1
|
|
|
3.0
|
|
|
—
|
|
|
8.3
|
|
|
0.5
|
|
|
22.9
|
|
Other (b)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.3
|
|
|
1.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT
|
|
|
253.5
|
|
|
81.7
|
|
|
89.2
|
|
|
169.9
|
|
|
(74.4)
|
|
|
519.9
|
|
Depreciation and amortization (c)
|
|
|
73.1
|
|
|
31.6
|
|
|
12.6
|
|
|
40.4
|
|
|
46.8
|
|
|
204.5
|
|
Adjusted EBITDA
|
|
$
|
326.6
|
|
$
|
113.3
|
|
$
|
101.8
|
|
$
|
210.3
|
|
$
|
(27.6)
|
|
$
|
724.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Amounts calculated prior to rounding.
|
|
(a) It is the Company's policy to record Income tax expense and
Interest expense on a consolidated basis. Accordingly, such amounts
are not reflected in the results of the operating segments and are
presented within Corporate/Unallocated Items.
|
|
(b) Other relates to onboarding costs for a key executive.
|
|
(c) Included within depreciation and amortization is amortization of
stock based compensation.
|
|
|
|
|
Table 4
|
|
SPECTRUM BRANDS HOLDINGS, INC.
|
|
Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA
|
|
For the three months ended September 30, 2013
|
|
(Unaudited)
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global
Batteries &
Appliances
|
|
Global Pet
Supplies
|
|
Home &
Garden
|
|
Hardware &
Home
Improvement
|
|
Corporate /
Unallocated
Items (a)
|
|
Consolidated
Spectrum
Brands
Holdings, Inc.
|
|
Net income (loss) attributable to controlling interest, as adjusted
(a)
|
|
$
|
54.9
|
|
$
|
25.9
|
|
$
|
18.7
|
|
$
|
38.3
|
|
$
|
(174.5)
|
|
$
|
(36.7)
|
|
Net loss attributable to non-controlling interest
|
|
(0.1)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.1)
|
|
Net income (loss), as adjusted (a)
|
|
|
54.8
|
|
|
25.9
|
|
|
18.7
|
|
|
38.3
|
|
|
(174.5)
|
|
|
(36.8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27.6)
|
|
|
(27.6)
|
|
Interest expense
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
183.9
|
|
|
183.9
|
|
Acquisition and integration related charges
|
|
|
1.7
|
|
|
0.6
|
|
|
—
|
|
|
3.3
|
|
|
2.3
|
|
|
7.9
|
|
Restructuring and related charges
|
|
|
3.3
|
|
|
1.7
|
|
|
0.1
|
|
|
1.2
|
|
|
—
|
|
|
6.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT
|
|
|
59.8
|
|
|
28.2
|
|
|
18.8
|
|
|
42.8
|
|
|
(15.9)
|
|
|
133.7
|
|
Depreciation and amortization (b)
|
|
|
17.5
|
|
|
7.6
|
|
|
3.0
|
|
|
11.6
|
|
|
11.3
|
|
|
51.0
|
|
Adjusted EBITDA
|
|
$
|
77.3
|
|
$
|
35.8
|
|
$
|
21.8
|
|
$
|
54.4
|
|
$
|
(4.6)
|
|
$
|
184.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Amounts calculated prior to rounding.
|
|
(a) It is the Company's policy to record Income tax expense and
Interest expense on a consolidated basis. Accordingly, such amounts
are not reflected in the results of the operating segments and are
presented within Corporate/Unallocated Items.
|
|
(b) Included within depreciation and amortization is amortization of
stock based compensation.
|
|
|
|
|
Table 4
|
|
SPECTRUM BRANDS HOLDINGS, INC.
|
|
Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA
|
|
For the year ended September 30, 2013
|
|
(Unaudited)
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global
Batteries &
Appliances
|
|
Global Pet
Supplies
|
|
Home &
Garden
|
|
Hardware &
Home
Improvement
|
|
Corporate /
Unallocated
Items (a)
|
|
Consolidated
Spectrum
Brands
Holdings, Inc.
|
|
Net income (loss) attributable to controlling interest, as adjusted
(a)
|
|
$
|
214.1
|
|
$
|
77.0
|
|
$
|
77.7
|
|
$
|
75.0
|
|
$
|
(499.0)
|
|
$
|
(55.2)
|
|
Net loss attributable to non-controlling interest
|
|
(0.5)
|
|
|
—
|
|
|
—
|
|
|
0.4
|
|
|
—
|
|
|
(0.1)
|
|
Net income (loss), as adjusted (a)
|
|
|
213.6
|
|
|
77.0
|
|
|
77.7
|
|
|
75.4
|
|
|
(499.0)
|
|
|
(55.3)
|
|
Pre-acquisition earnings of HHI (b)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30.3
|
|
|
—
|
|
|
30.3
|
|
Income tax expense
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27.4
|
|
|
27.4
|
|
Interest expense
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
375.6
|
|
|
375.6
|
|
Acquisition and integration related charges
|
|
|
6.1
|
|
|
2.2
|
|
|
0.1
|
|
|
7.4
|
|
|
32.6
|
|
|
48.4
|
|
Restructuring and related charges
|
|
|
14.8
|
|
|
11.2
|
|
|
0.6
|
|
|
6.2
|
|
|
1.2
|
|
|
34.0
|
|
HHI Business inventory fair value adjustment
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
31.0
|
|
|
—
|
|
|
31.0
|
|
Venezuela devaluation
|
|
|
2.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT
|
|
|
236.5
|
|
|
90.4
|
|
|
78.4
|
|
|
150.3
|
|
|
(62.2)
|
|
|
493.4
|
|
Depreciation and amortization (c)
|
|
|
67.2
|
|
|
29.6
|
|
|
11.7
|
|
|
31.3
|
|
|
43.9
|
|
|
183.7
|
|
Adjusted EBITDA
|
|
$
|
303.7
|
|
$
|
120.0
|
|
$
|
90.1
|
|
$
|
181.6
|
|
$
|
(18.3)
|
|
$
|
677.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Amounts calculated prior to rounding.
|
|
(a) It is the Company's policy to record Income tax expense and
Interest expense on a consolidated basis. Accordingly, such amounts
are not reflected in the results of the operating segments and are
presented within Corporate/Unallocated Items.
|
|
(b) The Pre-acquisition earnings of HHI do not include the TLM
Business as stand alone financial data is not available for the
periods presented. The TLM Business is not deemed material to the
Company's operating results.
|
|
(c) Included within depreciation and amortization is amortization of
stock based compensation.
|
|
|
|
|
Table 5
|
|
SPECTRUM BRANDS HOLDINGS, INC.
|
|
Pro Forma Net Sales Comparison
|
|
For the three and twelve months ended September 30, 2014 and
September 30, 2013
|
|
(Unaudited)
|
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
|
|
|
|
TWELVE MONTHS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
F2014
|
|
F2013
|
|
INC %
|
|
F2014
|
|
F2013
|
|
INC %
|
|
Spectrum Brands Holdings, Inc.
Net sales - as reported
|
|
$
|
1,178.3
|
|
$
|
1,137.7
|
|
3.6 %
|
|
$
|
4,429.1
|
|
$
|
4,085.6
|
|
8.4 %
|
|
HHI pre-acquisition Net sales (a)
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
191.8
|
|
|
|
Pro Forma Net Sales
|
|
$
|
1,178.3
|
|
$
|
1,137.7
|
|
3.6 %
|
|
$
|
4,429.1
|
|
$
|
4,277.4
|
|
3.5 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Net sales have been adjusted to reflect the acquisition of HHI
as if it occurred at the beginning of each period presented. HHI
pre-acquisition Net sales do not include the TLM Business as stand
alone financial data is not available for the periods presented. The
TLM Business is not deemed material to the Company's operating
results.
|
|
|
|
Table 6
|
|
SPECTRUM BRANDS HOLDINGS, INC.
|
|
Reconciliation of Cash Flow from Operating Activities to Adjusted
Free Cash Flow
|
|
For the years ended September 30, 2014, September 30, 2013 and
September 30, 2012
|
|
(Unaudited)
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
2013
|
|
2012
|
|
Net Cash provided from Operating Activities
|
|
$
|
432
|
|
$
|
256
|
|
$
|
255
|
|
Cash interest charges related to refinancing
|
|
|
—
|
|
|
44
|
|
|
—
|
|
Cash acquisition transaction costs
|
|
|
—
|
|
|
36
|
|
|
—
|
|
Purchases of property, plant and equipment
|
|
|
(73)
|
|
|
(82)
|
|
|
(47)
|
|
Adjusted Free Cash Flow
|
|
$
|
359
|
|
$
|
254
|
|
$
|
208
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 7
|
|
SPECTRUM BRANDS HOLDINGS, INC.
|
|
Reconciliation of Forecasted Cash Flow from Operating Activities
to Forecasted Free Cash Flow
|
|
For the year ending September 30, 2015
|
|
(Unaudited)
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
Forecasted range:
|
|
|
|
|
|
|
|
|
|
Net Cash provided from Operating Activities
|
|
$
|
475 - 485
|
|
Purchases of property, plant and equipment
|
|
|
(75) - (85)
|
|
Free Cash Flow
|
|
$
|
400
|
|
|
|
|
|
Copyright Business Wire 2014