- Net Sales Decreased 1.5% Driven by Lower Consumer Demand in
Home Appliances, Aquatics Particularly in North America and the
Impact of SKU Rationalizations, Offset by Strong POS in Controls
Due to Favorable Weather Trends
- Net Income From Continuing Operations of $49.9 Million and
Adjusted EBITDA of $112.3 Million Improved by $124.9 million and
$61.3 million, Respectively
- Excluding Investment Income of $17.0 million, Adjusted
EBITDA was $95.3 million
- Repurchased 1.2 million Shares in Q2 for $98
million
- Repurchased 12.1 Million Shares Since the Close of HHI
Through Today for $920 Million
- Entered into New Long-Term Black & Decker License
Agreement
- Updating Fiscal 2024 Earnings Framework and Now Expect Net
Sales to be Relatively Flat Compared to Prior Year and, Excluding
Investment Income, Adjusted EBITDA to Grow Low
Double-Digits
Spectrum Brands Holdings, Inc. (NYSE: SPB; “Spectrum Brands” or
the “Company”), a leading global branded consumer products and home
essentials company focused on driving innovation and providing
exceptional customer service, today reported results from
continuing operations for the second quarter of fiscal 2024 ended
March 31, 2024.
“We are pleased to report a strong second quarter of fiscal 24,
building off the operating momentum we drove in our first quarter.
Our sales performance improved sequentially and our operations
produced a gross margin of 38.1%, an 870 basis point improvement
over last year. Our net income increased $124.9 million and our
Adjusted EBITDA, excluding investment income, more than doubled to
$95.3 million. Net income margins increased to 6.9% and Adjusted
EBITDA margins, excluding investment income, nearly doubled to
13.3%. Given our first half performance, and expectations for
modest top-line growth in the second half of the year, we are
raising our full year Earnings Framework and now expect net sales
to be relatively flat and Adjusted EBITDA to grow in the low
double-digits,“ said David Maura, Chairman and Chief Executive
Officer of Spectrum Brands.
Mr. Maura continued, "I am also happy to announce that we have
entered into a new agreement with Stanley Black & Decker to
license the Black & Decker name in the same categories and
geographies as before through the end of calendar 2027, with two
additional four year extensions, providing us with access to the
Black & Decker brand name through the end of calendar 2035.
This is a significant milestone for us, providing certainty on our
future access to this important brand name. Given this and the
continued improving financial performance in our Home and Personal
Care business (“HPC”), we are continuing to pursue a strategic
alternative for HPC via a sale, joint venture or spin later this
year. To that end, our internal teams, along with outside advisors,
have made significant progress in preparation to launch a
multi-track process and we anticipate filing an initial Form 10
spin document this summer."
Fiscal 2024 Second Quarter
Highlights
Three Month Periods
Ended
(in millions, except per share and
%)
March 31, 2024
April 2, 2023
Variance
Net sales
$
718.5
$
729.2
$
(10.7
)
(1.5
)%
Gross profit
273.4
214.5
58.9
27.5
%
Gross profit margin
38.1
%
29.4
%
870
bps
Operating income (loss)
$
75.9
$
(77.0
)
$
152.9
n/m
Net income (loss) from continuing
operations
49.9
(75.0
)
124.9
n/m
Net income (loss) from continuing
operations margin
6.9
%
(10.3
)%
1,720
bps
Diluted earnings per share from continuing
operations
$
1.65
$
(1.83
)
$
3.48
n/m
Non-GAAP Operating Metrics
Adjusted EBITDA from continuing
operations
$
112.3
$
51.0
$
61.3
120.2
%
Adjusted EBITDA margin
15.6
%
7.0
%
860
bps
Adjusted EPS from continuing
operations
$
1.62
$
(0.14
)
$
1.76
n/m
n/m = not meaningful
- Net sales decreased 1.5% with a decrease in organic net sales
of 1.6%, excluding the impact of $1.2 million of favorable foreign
exchange rates. Net sales declined due to lower sales in home
appliances, volume declines in Aquatics in North America, and the
impact of SKU rationalizations, offset by stronger Controls
sales.
- Gross profit and gross profit margin increased from the sale of
lower cost inventory, lower inventory-related expenses, favorable
mix and cost improvements.
- Operating income increased due to the recognition of a $65
million gain from representation and warranty insurance proceeds,
reduced intangible asset impairments, distribution cost
favorability, reduced spend on restructuring, optimization and
strategic transaction activities and lower factoring charges,
offset by increased investments in advertising and marketing.
- Net income from continuing operations and diluted earnings per
share increased from the increase in operating income, higher
investment income, lower interest costs, and lower share
count.
- Adjusted EBITDA increased 120.2% and adjusted EBITDA margin
increased 860 basis points attributable to higher gross margins,
lower operating expenses and higher investment income, partially
offset by the reduction in sales volume.
- Adjusted diluted EPS increased to $1.62 due to higher Adjusted
EBITDA and a reduction in outstanding shares.
Fiscal 2024 Second Quarter Segment
Level Data
Global Pet Care (GPC)
Three Month Periods
Ended
(in millions, except %)
March 31, 2024
April 2, 2023
Variance
Net sales
$
289.9
$
296.7
$
(6.8
)
(2.3
)%
Segment net income
53.0
30.2
22.8
75.5
%
Segment net income margin
18.3
%
10.2
%
810
bps
Adjusted EBITDA
$
62.3
$
46.3
$
16.0
34.6
%
Adjusted EBITDA margin
21.5
%
15.6
%
590
bps
Net sales decreased 2.3%, with a decrease in organic net sales
of 3.0%, excluding favorable foreign currency impacts of $2.2
million.
The decrease in net sales was driven by the exit of
non-strategic and lower-profit SKUs, as well as demand softness in
the aquatics category in North America. Global companion animal
sales were relatively flat, despite the impact of exiting
non-strategic and lower-profit SKUs. North American sales declined
due to soft demand in aquatics and the SKU exits. Sales in EMEA
increased due to growth in both the Companion Animal and Aquatics
categories.
Segment net income, Adjusted EBITDA and margins increased due to
lower cost inventory compared to the prior year, favorable product
and channel mix, and savings from operational productivity
investments. This was partially offset by lower volumes, increased
investments in advertising and programming, and FX.
Home & Garden
(H&G)
Three Month Periods
Ended
(in millions, except %)
March 31, 2024
April 2, 2023
Variance
Net sales
$
160.7
$
153.3
$
7.4
4.8
%
Segment net loss
(14.6
)
(39.8
)
25.2
(63.3
)%
Segment net loss margin
(9.1
)%
(26.0
)%
1,690
bps
Adjusted EBITDA
$
29.2
$
15.1
$
14.1
93.4
%
Adjusted EBITDA margin
18.2
%
9.8
%
840
bps
Net sales and organic net sales increased 4.8%. The net sales
increase was primarily driven by higher sales in the Controls
business, where favorable weather trends in key regions drove
higher retail POS and acceleration of purchases by retailers,
offset by declines in Household Insect Controls and Repellents.
Sales in the Cleaning category also declined, as consumer demand
for certain product lines within this category remain soft compared
to COVID demand levels.
The improved segment net income, Adjusted EBITDA, and margins
were driven by higher sales, manufacturing efficiencies,
operational cost reductions from cost improvement initiatives, and
favorable mix, offset by increased investments in innovation and
advertising. Segment net income was also impacted by lower
year-over-year impairment charges.
Home & Personal Care
(HPC)
Three Month Periods
Ended
(in millions, except %)
March 31, 2024
April 2, 2023
Variance
Net sales
$
267.9
$
279.2
$
(11.3
)
(4.0
)%
Segment net income (loss)
69.3
(37.7
)
107.0
n/m
Segment net income (loss) margin
25.9
%
(13.5
)%
3,940
bps
Adjusted EBITDA
$
17.8
$
(1.9
)
$
19.7
n/m
Adjusted EBITDA margin
6.6
%
(0.7
)%
730
bps
n/m = not meaningful
Net sales decreased 4.0%, with a decrease in organic net sales
of 3.7%, excluding unfavorable foreign currency impact of $1.0
million. The decrease in net sales is primarily due to sales
declines in small Kitchen Appliances, offset by growth in Personal
Care. Sales in EMEA increased, with growth in Personal Care
offsetting sales declines in small Kitchen Appliances. Sales in
LATAM grew across both Personal Care and small Kitchen Appliances
categories.
The increase in segment net income, Adjusted EBITDA and margins
were driven by lower cost inventory compared to the prior year,
lower inventory related expenses and cost improvement initiatives,
including reduction of operating expenses initiated in the prior
year, and pricing, offset by lower volumes, increased investments
and negative mix. Segment net income was increased by a $65 million
insurance settlement for claims under a representations and
warranty insurance policy related to the Tristar acquisition and
intangible impairment charges in the prior year.
Liquidity and Debt
As of the end of the quarter, the Company had a cash balance of
$746 million plus $500 million of short-term investments consisting
of term deposits with a maturity greater than 3 months but less
than 12 months, and $1,401 million of debt outstanding, consisting
of $1,317 million of senior unsecured notes and $84 million of
finance leases. The Company ended the quarter with net debt of
approximately $155 million.
Fiscal 2024 Earnings Framework
Spectrum Brands now expects reported net sales to be relatively
flat to Fiscal 2023. Fiscal 2024 Adjusted EBITDA, excluding
investment income, is expected to increase by low
double-digits.
The Company continues to target a long-term net leverage ratio
of 2.0 - 2.5 times after full deployment of HHI sale proceeds.
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, May 9, 2024. The 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. Participants
may register here. Instructions will be provided to ensure
the necessary audio applications are downloaded and installed.
Users can obtain these at no charge.
A replay of the live broadcast will be accessible through the
Event Calendar page in the Investor Relations section of the
Company’s website.
About Spectrum Brands Holdings, Inc.
Spectrum Brands Holdings is a home-essentials company with a
mission to make living better at home. We focus on delivering
innovative products and solutions to consumers for use in and
around the home through our trusted brands. We are a leading
supplier of specialty pet supplies, lawn and garden and home pest
control products, personal insect repellents, shaving and grooming
products, personal care products, and small household appliances.
Helping to meet the needs of consumers worldwide, Spectrum Brands
offers a broad portfolio of market-leading, well-known and widely
trusted brands including Tetra®, DreamBone®, SmartBones®, Nature’s
Miracle®, 8-in-1®, FURminator®, Healthy-Hide®, Good Boy®, Meowee!®,
OmegaOne®, Spectracide®, Cutter®, Repel®, Hot Shot®, Rejuvenate®,
Black Flag®, Liquid Fence®, Remington®, George Foreman®, Russell
Hobbs®, Black + Decker®, PowerXL®, Emeril Lagasse®, and Copper
Chef®. For more information, please visit www.spectrumbrands.com.
Spectrum Brands – A Home Essentials Company™
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. Within this document, including the tables that follow,
reference is made to organic net sales, adjusted earnings before
interest, taxes, depreciation and amortization (EBITDA), adjusted
EBITDA margin, and adjusted earnings per share (EPS). Management
believes that organic net sales provide for a more complete
understanding of underlying business trends of regional and segment
performance by excluding the impact of foreign currency exchange
fluctuations and the impact of acquisitions (when applicable) when
there is no comparable sales in the prior period. Organic sales
growth is calculated by comparing organic net sales to net sales in
the prior comparative period. The effect of changes in foreign
currency exchange rates is determined by translating the period’s
net sales using the foreign currency exchange rates that were in
effect during the prior comparative period. Adjusted EBITDA is a
metric used by management to evaluate segment performance and
frequently used by the financial community, which provides insight
into an organization’s operating trends and facilitates comparisons
between peer companies, because interest, taxes, depreciation and
amortization can differ greatly between organizations as a result
of differing capital structures and tax strategies. Adjusted EBITDA
can also be a useful measure 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.
Adjusted EBITDA margin reflects adjusted EBITDA as a percentage of
net sales. Management uses adjusted diluted EPS as 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. An income tax adjustment is
included in adjusted diluted EPS 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
of 25.0%. 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. Supplemental tables
have been provided within the Appendix to this document to
demonstrate reconciliation of non-GAAP measurements to the most
comparable GAAP measure.
Forward-Looking Statements
We have made or implied certain forward-looking statements in
this document and may make additional oral forward-looking
statements from time to time. All statements, other than statements
of historical facts included or incorporated by reference in this
document, including, without limitation, statements or expectations
regarding our business strategy, future operations, financial
condition, estimated revenues, projected costs, inventory
management, earnings power, projected synergies, prospects, plans
and objectives of management, outcome of any litigation and
information concerning expected actions of third parties are
forward-looking statements. When used in this document, the words
future, anticipate, pro forma, seek, intend, plan, envision,
estimate, believe, belief, expect, project, forecast, outlook,
earnings framework, goal, target, could, would, will, can, should,
may and similar expressions are intended to identify
forward-looking statements, although not all forward-looking
statements contain such identifying words.
Since these forward-looking statements are based upon our
current expectations of future events and projections and are
subject to a number of risks and uncertainties, many of which are
beyond our control and some of which may change rapidly, actual
results or outcomes may differ materially from those expressed or
implied herein, and you should not place undue reliance on these
statements. Important factors that could cause our actual results
to differ materially from those expressed or implied herein
include, without limitation: (1) the economic, social and political
conditions or civil unrest, terrorist attacks, acts of war, natural
disasters, other public health concerns or unrest in the United
States or the international markets impacting our business,
customers, employees (including our ability to retain and attract
key personnel), manufacturing facilities, suppliers, capital
markets, financial condition and results of operations, all of
which tend to aggravate the other risks and uncertainties we face;
(2) the impact of a number of local, regional and global
uncertainties could negatively impact our business; (3) the
negative effect of the Russia-Ukraine war and the Israel-Hamas war
and their impact on those regions and surrounding regions,
including the Middle East, and on our operations and operations of
our customers, suppliers and other stakeholders; (4) our increased
reliance on third-party partners, suppliers and distributors to
achieve our business objectives; (5) the impact of expenses
resulting from the implementation of new business strategies,
divestitures or current and proposed restructuring and optimization
activities, including changes in inventory and distribution center
changes which are complicated and involve coordination among a
number of stakeholders, including our suppliers and transportation
and logistics handlers; (6) the impact of our indebtedness and
financial leverage position on our business, financial condition
and results of operations; (7) the impact of restrictions in our
debt instruments on our ability to operate our business, finance
our capital needs or pursue or expand business strategies; (8) any
failure to comply with financial covenants and other provisions and
restrictions of our debt instruments; (9) the effects of general
economic conditions, including the impact of, and changes to
tariffs and trade policies, inflation, recession or fears of a
recession, depression or fears of a depression, labor costs and
stock market volatility or monetary or fiscal policies in the
countries where we do business; (10) the impact of fluctuations in
transportation and shipment costs, fuel costs, commodity prices,
costs or availability of raw materials or terms and conditions
available from suppliers, including suppliers’ willingness to
advance credit; (11) interest rate fluctuations; (12) changes in
foreign currency exchange rates that may impact our purchasing
power, pricing and margin realization within international
jurisdictions; (13) the loss of, significant reduction in or
dependence upon, sales to any significant retail customer(s),
including their changes in retail inventory levels and management
thereof; (14) competitive promotional activity or spending by
competitors, or price reductions by competitors; (15) the
introduction of new product features or technological developments
by competitors and/or the development of new competitors or
competitive brands; (16) changes in consumer spending preferences
and demand for our products, particularly in light of economic
stress; (17) our ability to develop and successfully introduce new
products, protect intellectual property and avoid infringing the
intellectual property of third parties; (18) our ability to
successfully identify, implement, achieve and sustain productivity
improvements, cost efficiencies (including at our manufacturing and
distribution operations) and cost savings; (19) the seasonal nature
of sales of certain of our products; (20) the impact weather
conditions may have on the sales of certain of our products; (21)
the effects of climate change and unusual weather activity as well
as our ability to respond to future natural disasters and pandemics
and to meet our environmental, social and governance goals; (22)
the cost and effect of unanticipated legal, tax or regulatory
proceedings or new laws or regulations (including environmental,
public health and consumer protection regulations); (23) public
perception regarding the safety of products that we manufacture and
sell, including the potential for environmental liabilities,
product liability claims, litigation and other claims related to
products manufactured by us and third parties; (24) the impact of
existing, pending or threatened litigation, government regulation
or other requirements or operating standards applicable to our
business; (25) the impact of cybersecurity breaches or our actual
or perceived failure to protect company and personal data,
including our failure to comply with new and increasingly complex
global data privacy regulations; (26) changes in accounting
policies applicable to our business; (27) our discretion to adopt,
conduct, suspend or discontinue any share repurchase program or
conduct any debt repayments, redemptions, repurchases or
refinancing transactions (including our discretion to conduct
purchases or repurchases, if any, in a variety of manners including
open-market purchases, privately negotiated transactions, tender
offers, redemptions, or otherwise); (28) our ability to utilize net
operating loss carry-forwards to offset tax liabilities; (29) our
ability to separate the Company's HPC business and create an
independent Global Appliances business on expected terms, and
within the anticipated time period, or at all, and to realize the
potential benefits of such business; (30) our ability to create a
pure play consumer products company composed of our Global Pet Care
("GPC") and Home & Garden ("H&G") business and to realize
the expected benefits of such creation, and within the anticipated
time period, or at all; (31) our ability to successfully implement,
and realize the benefits of, acquisitions or dispositions and the
impact of any such transactions on our financial performance; (32)
the impact of actions taken by significant shareholders; and (33)
the unanticipated loss of key members of senior management and the
transition of new members of our management teams to their new
roles; and (34) the other risk factors set forth in the securities
filings of Spectrum Brands Holdings, Inc. and SB/RH Holdings, LLC,
including the 2023 Annual Report and subsequent Quarterly Reports
on Form 10-Q.
Some of the above-mentioned factors are described in further
detail in the sections entitled Risk Factors in our annual and
quarterly reports, as applicable. You should assume the information
appearing in this document is accurate only as of the end of the
period covered by this document, or as otherwise specified, as our
business, financial condition, results of operations and prospects
may have changed since that date. Except as required by applicable
law, including the securities laws of the United States and the
rules and regulations of the United States Securities and Exchange
Commission , we undertake no obligation to publicly update or
revise any forward-looking statement, whether as a result of new
information, future events or otherwise, to reflect actual results
or changes in factors or assumptions affecting such forward-looking
statements.
SPECTRUM BRANDS HOLDINGS,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (Unaudited)
Three Month Periods
Ended
Six Month Periods
Ended
(in millions, except per share
amounts)
March 31, 2024
April 2, 2023
March 31, 2024
April 2, 2023
Net sales
$
718.5
$
729.2
$
1,410.7
$
1,442.5
Cost of goods sold
445.1
514.7
892.3
1,026.1
Gross profit
273.4
214.5
518.4
416.4
Selling, general & administrative
223.5
224.5
439.4
448.1
Impairment of intangible assets
39.0
67.0
43.0
67
Representation and warranty insurance
proceeds
(65.0
)
—
(65.0
)
—
Gain from remeasurement of contingent
consideration liability
—
—
—
(1.5
)
Total operating expenses
197.5
291.5
417.4
513.6
Operating income (loss)
75.9
(77.0
)
101.0
(97.2
)
Interest expense
16.9
31.6
36.1
65.0
Interest income
(17.5
)
(0.2
)
(40.9
)
(0.4
)
Gain from debt repurchase
—
—
(4.7
)
—
Other non-operating expense, net
1.1
1.4
5.2
0.1
Income (loss) from continuing operations
before income taxes
75.4
(109.8
)
105.3
(161.9
)
Income tax expense (benefit)
25.5
(34.8
)
37.9
(46.9
)
Net income (loss) from continuing
operations
49.9
(75.0
)
67.4
(115.0
)
Income from discontinued operations, net
of tax
11.0
21.4
22.7
40.9
Net income (loss)
60.9
(53.6
)
90.1
(74.1
)
Net (loss) income from continuing
operations attributable to non-controlling interest
(0.2
)
0.1
(0.1
)
0.3
Income from discontinued operations
attributable to non-controlling interest, net of tax
—
—
—
0.2
Net income (loss) attributable to
controlling interest
$
61.1
$
(53.7
)
$
90.2
$
(74.6
)
Amounts attributable to controlling
interest
Net income (loss) from continuing
operations attributable to controlling interest
$
50.1
$
(75.1
)
$
67.5
$
(115.3
)
Income from discontinued operations
attributable to controlling interest, net of tax
11.0
21.4
22.7
40.7
Net income (loss) attributable to
controlling interest
$
61.1
$
(53.7
)
$
90.2
$
(74.6
)
Earnings Per Share
Basic earnings per share from continuing
operations
$
1.66
$
(1.83
)
$
2.10
$
(2.82
)
Basic earnings per share from discontinued
operations
0.37
0.52
0.71
1.00
Basic earnings per share
$
2.03
$
(1.31
)
$
2.81
$
(1.82
)
Diluted earnings per share from continuing
operations
$
1.65
$
(1.83
)
$
2.09
$
(2.82
)
Diluted earnings per share from
discontinued operations
0.36
0.52
0.71
1.00
Diluted earnings per share
$
2.01
$
(1.31
)
$
2.80
$
(1.82
)
Weighted Average Shares
Outstanding
Basic
30.2
41.0
32.1
40.9
Diluted
30.4
41.0
32.2
40.9
SPECTRUM BRANDS HOLDINGS,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOW (Unaudited)
Six Month Periods
Ended
(in millions)
March 31, 2024
April 2, 2023
Cash flows from operating
activities
Net cash provided by operating activities
from continuing operations
$
80.7
$
148.6
Net cash (used) provided by operating
activities from discontinued operations
(81.5
)
29.0
Net cash (used) provided by operating
activities
(0.8
)
177.6
Cash flows from investing
activities
Purchases of property, plant and
equipment
(20.9
)
(25.9
)
Purchases of short term investments
(700.0
)
—
Proceeds from sale of short term
investments
1,292.0
—
Purchase price settlement from sale of
HHI
(26.9
)
—
Other investing activity
(0.1
)
—
Net cash provided (used) by investing
activities from continuing operations
544.1
(25.9
)
Net cash used by investing activities from
discontinued operations
—
(7.9
)
Net cash provided (used) by investing
activities
544.1
(33.8
)
Cash flows from financing
activities
Payment of debt
(177.9
)
(21.7
)
Payment of debt issuance costs
(3.2
)
(2.3
)
Treasury stock purchases
(340.5
)
—
Dividends paid to shareholders
(26.8
)
(34.4
)
Share based award tax withholding
payments, net of proceeds upon vesting
(5.4
)
(10.5
)
Net cash used by financing activities from
continuing operations
(553.8
)
(68.9
)
Net cash used by financing activities from
discontinued operations
—
(0.7
)
Net cash used by financing activities
(553.8
)
(69.6
)
Effect of exchange rate changes on cash
and cash equivalents
2.3
9.7
Net change in cash, cash equivalents and
restricted cash in continuing operations
(8.2
)
83.9
Cash, cash equivalents, and restricted
cash, beginning of period
753.9
243.9
Cash, cash equivalents, and restricted
cash, end of period
$
745.7
$
327.8
SPECTRUM BRANDS HOLDINGS,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF FINANCIAL POSITION (Unaudited)
(in millions)
March 31, 2024
September 30, 2023
Assets
Cash and cash equivalents
$
745.7
$
753.9
Short term investments
500.0
1,103.3
Trade receivables, net
601.3
477.1
Other receivables
113.5
84.5
Inventories
454.3
462.8
Prepaid expenses and other current
assets
45.9
44.3
Total current assets
2,460.7
2,925.9
Property, plant and equipment, net
269.5
275.1
Operating lease assets
119.2
110.8
Deferred charges and other
46.6
31.8
Goodwill
858.3
854.7
Intangible assets, net
1,002.3
1,060.1
Total assets
$
4,756.6
$
5,258.4
Liabilities and Shareholders'
Equity
Current portion of long-term debt
$
9.0
$
8.6
Accounts payable
375.5
396.6
Accrued wages and salaries
48.1
46.1
Accrued interest
19.0
20.6
Income tax payable
33.3
114.5
Other current liabilities
174.0
178.4
Total current liabilities
658.9
764.8
Long-term debt, net of current portion
1,374.4
1,546.9
Long-term operating lease liabilities
101.3
95.6
Deferred income taxes
189.6
174.8
Other long-term liabilities
174.9
158.0
Total liabilities
2,499.1
2,740.1
Shareholders' equity
2,256.9
2,517.6
Non-controlling interest
0.6
0.7
Total equity
2,257.5
2,518.3
Total liabilities and equity
$
4,756.6
$
5,258.4
SPECTRUM BRANDS HOLDINGS,
INC.
OTHER SUPPLEMENTAL INFORMATION
(Unaudited)
NET SALES AND ORGANIC NET
SALES
The following is a summary of net sales by
segment for the three and six month periods ended March 31, 2024
and April 2, 2023:
(in millions, except %)
Three Month Periods
Ended
Six Month Periods
Ended
March 31, 2024
April 2, 2023
Variance
March 31, 2024
April 2, 2023
Variance
GPC
$
289.9
$
296.7
$
(6.8
)
(2.3
)%
$
566.8
$
574.3
$
(7.5
)
(1.3
)%
H&G
160.7
153.3
7.4
4.8
%
232.7
224.6
8.1
3.6
%
HPC
267.9
279.2
(11.3
)
(4.0
)%
611.2
643.6
(32.4
)
(5.0
)%
Net Sales
$
718.5
$
729.2
(10.7
)
(1.5
)%
$
1,410.7
$
1,442.5
(31.8
)
(2.2
)%
We define organic net sales as reported net sales excluding the
effect of changes in foreign currency exchange rates and
acquisitions. We believe this non-GAAP measure provides useful
information to investors because it reflects regional and operating
segment performance from our activities without the effect of
changes in currency exchange rate and acquisitions. We use organic
net sales as one measure to monitor and evaluate our regional and
segment performance. Organic growth is calculated by comparing
organic net sales to reported net sales in the prior year. The
effect of changes in currency exchange rates is determined by
translating the current period net sales using the currency
exchange rates that were in effect during the prior period. Net
sales are attributed to the geographic regions based on the country
of destination. We exclude net sales from acquired businesses in
the current year for which there are no comparable sales in the
prior period. The following is a reconciliation of reported sales
to organic sales for the three and six month period ended March 31,
2024 compared to reported net sales for the three and six month
periods ended April 2, 2023:
March 31, 2024
Three Month Periods Ended
(in millions, except %)
Net Sales
Effect of Changes
in Currency
Organic Net
Sales
Net Sales
April 2, 2023
Variance
GPC
$
289.9
$
(2.2
)
$
287.7
$
296.7
$
(9.0
)
(3.0
)%
H&G
160.7
—
160.7
153.3
7.4
4.8
%
HPC
267.9
1.0
268.9
279.2
(10.3
)
(3.7
)%
Total
$
718.5
$
(1.2
)
$
717.3
$
729.2
(11.9
)
(1.6
)%
March 31, 2024
Six Month Periods Ended
(in millions, except %)
Net Sales
Effect of Changes
in Currency
Organic Net
Sales
Net Sales
April 2, 2023
Variance
GPC
$
566.8
$
(7.2
)
$
559.6
$
574.3
$
(14.7
)
(2.6
)%
H&G
232.7
—
232.7
224.6
8.1
3.6
%
HPC
611.2
(5.7
)
605.5
643.6
(38.1
)
(5.9
)%
Total
$
1,410.7
$
(12.9
)
$
1,397.8
$
1,442.5
(44.7
)
(3.1
)%
ADJUSTED EBITDA AND ADJUSTED EBITDA
MARGIN
Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation,
Amortization) is a non-GAAP metric used by management that we
believe provides useful information to investors because it
reflects ongoing operating performance and trends of our segments
excluding certain non-cash based expenses and non-recurring items
during each of the comparable periods 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. Further,
adjusted EBITDA is a measure used for determining the Company’s
debt covenant. EBITDA is calculated by excluding the Company’s
income tax expense, interest expense, depreciation expense and
amortization expense from intangible assets from net income.
Adjusted EBITDA further excludes the following:
- Share based compensation costs consist of costs associated with
long-term incentive compensation arrangements that generally
consist of non-cash, stock-based compensation;
- Incremental project costs associated with strategic
transactions, restructuring and optimization initiatives including,
but not limited to, the acquisition or divestitures of a business,
costs to effect and facilitate a transaction, including such cost
to integrate or separate the respective business, development and
implementation of strategies to optimize operations, reduce costs,
increase revenues, improve profit margins, including recognition of
one-time exit or disposal costs. These amounts are excluded from
our performance metrics as they are reflective of incremental
investment by the Company towards strategic initiatives and
business development activities, incremental costs directly
attributable to such initiatives and are not considered recurring
or reflective of the continuing ongoing operations of the
consolidated group or segments;
- Non-cash purchase accounting adjustments recognized in earnings
from continuing operations subsequent to an acquisition, including,
but not limited to, the costs attributable to the step-up in
inventory value and the incremental value in operating lease assets
with below market rent, among others During the three and six month
periods ended March 31, 2024 and April 2, 2023, the Company
recognized non-cash expense due to the incremental value recognized
as part of the Tristar Business acquisition on right of use
operating leases with below market rent;
- Non-cash asset impairments or write-offs realized and
recognized in earnings from continuing operations, including
impairments from property, plant and equipment, operating and
finance leases, and goodwill and other intangible assets, when
applicable. During the three and six month period ended March 31,
2024, the Company recognized impairments of its Rejuvenate® and a
non-core HPC tradename indefinite lived intangible assets, along
with an impairment charge on a right of use operating lease asset
associated with an HPC facility that was exited prior to end of its
term. During the three and six month period ended April 2, 2023,
the Company recognized impairment of indefinite lived intangible
assets for its Rejuvenate® and PowerXL® indefinite lived
tradenames, along with an impairment on idle equipment associated
with the early exit of a GPC warehouse lease and impairments on
right of use operating lease assets associated with GPC and HPC
facilities that were exited prior to the end of their term;
- Gain realized from proceeds received on the representation and
warranties insurance policies associated with the Tristar Business
acquisition;
- Incremental reserves for non-recurring litigation or
environmental remediation activity attributable to significant and
unusual nonrecurring matters with no previous history or precedent.
During the three and six month periods ended March 31, 2024, such
costs were directly attributable to legal costs incurred for the
proceeds received from the representation and warranties insurance
policies associated with the Tristar Business acquisition;
- Non-cash gain realized from the repurchase of debt obligations
at a discount, net deferred financing costs, during the three and
six month periods ended March 31, 2024;
- Incremental costs associated with the recognition of product
recall costs incurred by the HPC segment in collaboration with the
CPSC, initiated at the end of the year ended September 30 2022 and
during the year ending September 30, 2023, resulting in the accrual
and recognition of incremental costs for the recall, product
returns from customers, write-off of inventory on hand, and other
costs such as notification, shipping and handling, rework and
destruction of affected products, and consumer refunds, as needed.
Such costs are not recurring and directly attributable to the
recall event, excluding all other costs associated with product
warranty and returns. During the three and six month period ended
March 31, 2024, the Company was required by the CPSC to reissue a
previously issued recall to provide a cash refund to customers,
resulting in the recognition of incremental costs and
reserves;
- Unallocated shared costs reflect the costs associated with
certain shared and center-led administrative functions such as
information technology, human resources, finance and accounting,
supply chain and commercial operations, supporting the HHI business
during the period the Company owned and operated the business
through the close of the HHI divestiture on June 20, 2023. Such
costs are excluded from income from discontinued operations as they
are not a direct cost of the discontinued business but a result of
indirect allocations in accordance of US GAAP, but reflected as
part of income from continuing operations for all periods
presented, and requiring retroactive adjustment for all periods
presented. HHI was previously a segment of the consolidated group
and was excluded from the consolidated Adjusted EBITDA since being
recognized as discontinued operations. As a result, for all periods
in which HHI was owned and operated by the Company, including
comparable periods requiring retroactive adjustment, the adjustment
is recognized to reconcile net income from continuing operations to
Adjusted EBITDA of the remaining segments of the consolidated
group. With the close of the HHI divestiture on June 20, 2023,
there is no adjustment recognized as such shared costs are
mitigated through income from TSAs during the transition period
post-separation, with subsequent restructuring initiatives to
rightsize extraneous costs;
- Non-cash gain from the remeasurement in the contingent
consideration liability associated with the Tristar Business
acquisition during the six month period ended April 2, 2023;
- For the three and six month periods ended April 2, 2023, the
impact from the early settlement of foreign currency cash flow
hedges during the year ended September 30, 2022, resulting in
assumed losses at the original stated maturities of foreign
currency cash flow hedges in our EMEA region that were settled
early due to changes in the Company's legal entity organizational
structure and forecasted purchasing strategy of HPC finished goods
inventory within the region, resulting in excluded gains intended
to mitigate costs during the year ending September 30, 2023;
and
- Other adjustments are attributable to: (1) key executive
severance and other one-time compensatory costs; and (2)
non-recurring unusual insurable losses, including any the receipt
of insurance proceeds or recovery realized.
Adjusted EBITDA margin is calculated as adjusted EBITDA as a
percentage of reported net sales for the respective periods.
SPECTRUM BRANDS HOLDINGS,
INC.
OTHER SUPPLEMENTAL INFORMATION
(Unaudited)
ADJUSTED EBITDA AND
ADJUSTED EBITDA MARGIN (continued)
The following is a reconciliation of
reported net income (loss) from continuing operations to adjusted
EBITDA and adjusted EBITDA margin for the three month period ended
March 31, 2024.
(in millions, except %)
GPC
H&G
HPC
Corporate
Consolidated
Net income (loss) from continuing
operations
$
53.0
$
(14.6
)
$
69.3
$
(57.8
)
$
49.9
Income tax expense
—
—
—
25.5
25.5
Interest expense
—
—
—
16.9
16.9
Depreciation
3.5
2.0
2.7
6.1
14.3
Amortization
5.6
2.9
2.6
—
11.1
EBITDA
62.1
(9.7
)
74.6
(9.3
)
117.7
Share based compensation
—
—
—
4.5
4.5
HHI separation costs
—
—
—
0.8
0.8
HPC separation initiatives
—
—
—
2.8
2.8
Fiscal 2023 and 2022 restructuring
0.1
—
0.3
—
0.4
Global ERP transformation
—
—
—
3.9
3.9
Other project costs
—
(0.1
)
(0.1
)
0.3
0.1
Non-cash purchase accounting
adjustments
—
—
0.5
—
0.5
Impairment of operating lease asset
—
—
0.5
—
0.5
Impairment of intangible assets
—
39.0
—
—
39.0
Representation and warranty insurance
proceeds
—
—
(65.0
)
—
(65.0
)
Legal and environmental
—
—
0.3
—
0.3
HPC product recall
—
—
6.7
—
6.7
Other
0.1
—
—
—
0.1
Adjusted EBITDA
$
62.3
$
29.2
$
17.8
$
3.0
$
112.3
Net sales
$
289.9
$
160.7
$
267.9
$
—
$
718.5
Net income (loss) from continuing
operations margin
18.3
%
(9.1
)%
25.9
%
—
%
6.9
%
Adjusted EBITDA margin
21.5
%
18.2
%
6.6
%
—
%
15.6
%
SPECTRUM BRANDS HOLDINGS,
INC.
OTHER SUPPLEMENTAL INFORMATION
(Unaudited)
ADJUSTED EBITDA AND
ADJUSTED EBITDA MARGIN (continued)
The following is a reconciliation of
reported net income (loss) from continuing operations to adjusted
EBITDA and adjusted EBITDA margin for the three month period ended
April 2, 2023.
(in millions, except %)
GPC
H&G
HPC
Corporate
Consolidated
Net income (loss) from continuing
operations
$
30.2
$
(39.8
)
$
(37.7
)
$
(27.7
)
$
(75.0
)
Income tax benefit
—
—
—
(34.8
)
(34.8
)
Interest expense
—
—
—
31.6
31.6
Depreciation
3.8
1.9
2.9
3.3
11.9
Amortization
5.5
2.9
2.1
—
10.5
EBITDA
39.5
(35.0
)
(32.7
)
(27.6
)
(55.8
)
Share based compensation
—
—
—
4.5
4.5
Tristar integration
—
—
4.0
—
4.0
HHI divestiture and separation costs
—
—
—
1.4
1.4
HPC separation initiatives
—
—
—
1.1
1.1
Fiscal 2023 and 2022 restructuring
2.1
—
2.4
0.1
4.6
Global ERP transformation
—
—
—
3.3
3.3
Russia closing initiatives
—
—
(0.1
)
—
(0.1
)
Other project costs
1.6
2.1
0.6
2.2
6.5
Non-cash purchase accounting
adjustments
—
—
0.5
—
0.5
Impairment of equipment and operating
lease assets
2.7
—
1.5
—
4.2
Impairment of intangible assets
—
48.0
19.0
—
67.0
Unallocated shared costs
—
—
—
6.3
6.3
Early settlement of foreign currency cash
flow hedges
—
—
1.3
—
1.3
HPC product recall
—
—
1.6
—
1.6
Other
0.4
—
—
0.2
0.6
Adjusted EBITDA
$
46.3
$
15.1
$
(1.9
)
$
(8.5
)
$
51.0
Net sales
$
296.7
$
153.3
$
279.2
$
—
$
729.2
Net income (loss) from continuing
operations margin
10.2
%
(26.0
)%
(13.5
)%
—
%
(10.3
)%
Adjusted EBITDA margin
15.6
%
9.8
%
(0.7
)%
—
%
7.0
%
SPECTRUM BRANDS HOLDINGS,
INC.
OTHER SUPPLEMENTAL INFORMATION
(Unaudited)
ADJUSTED EBITDA AND
ADJUSTED EBITDA MARGIN (continued)
The following is a reconciliation of
reported net income (loss) from continuing operations to adjusted
EBITDA and adjusted EBITDA margin for the six month period ended
March 31, 2024.
(in millions, except %)
GPC
H&G
HPC
Corporate
Consolidated
Net income (loss) from continuing
operations
$
96.6
$
(20.2
)
$
85.2
$
(94.2
)
$
67.4
Income tax expense
—
—
—
37.9
37.9
Interest expense
—
—
—
36.1
36.1
Depreciation
7.1
4.0
5.4
12.3
28.8
Amortization
11.2
5.7
5.3
—
22.2
EBITDA
114.9
(10.5
)
95.9
(7.9
)
192.4
Share based compensation
—
—
—
8.4
8.4
HHI separation costs
—
—
—
2.1
2.1
HPC separation initiatives
—
—
—
3.1
3.1
Fiscal 2023 and 2022 restructuring
0.2
—
0.7
—
0.9
Global ERP transformation
—
—
—
6.9
6.9
Other project costs
(0.1
)
—
—
0.2
0.1
Non-cash purchase accounting
adjustments
—
—
0.9
—
0.9
Impairment of operating lease asset
—
—
0.5
—
0.5
Impairment of intangible assets
—
39.0
4.0
—
43.0
Representation and warranty insurance
proceeds
—
—
(65.0
)
—
(65.0
)
Legal and environmental
—
—
1.5
—
1.5
Gain from debt repurchase
—
—
—
(4.7
)
(4.7
)
HPC product recall
—
—
6.0
—
6.0
Other
0.1
—
—
0.4
0.5
Adjusted EBITDA
$
115.1
$
28.5
$
44.5
$
8.5
$
196.6
Net sales
$
566.8
$
232.7
$
611.2
$
—
$
1,410.7
Net income (loss) from continuing
operations margin
17.0
%
(8.7
)%
13.9
%
—
%
4.8
%
Adjusted EBITDA margin
20.3
%
12.2
%
7.3
%
—
%
13.9
%
SPECTRUM BRANDS HOLDINGS,
INC.
OTHER SUPPLEMENTAL INFORMATION
(Unaudited)
ADJUSTED EBITDA AND
ADJUSTED EBITDA MARGIN (continued)
The following is a reconciliation of
reported net income (loss) from continuing operations to adjusted
EBITDA and adjusted EBITDA margin for the six month period ended
April 2, 2023.
(in millions, except %)
GPC
H&G
HPC
Corporate
Consolidated
Net income (loss) from continuing
operations
$
53.3
$
(47.0
)
$
(41.8
)
$
(79.5
)
$
(115.0
)
Income tax benefit
—
—
—
(46.9
)
(46.9
)
Interest expense
—
—
—
65.0
65.0
Depreciation
7.5
3.7
6.1
6.8
24.1
Amortization
11.0
5.7
4.2
—
20.9
EBITDA
71.8
(37.6
)
(31.5
)
(54.6
)
(51.9
)
Share based compensation
—
—
—
7.7
7.7
Tristar integration
—
—
9.7
—
9.7
HHI divestiture and separation costs
—
—
—
2.9
2.9
HPC separation initiatives
—
—
—
3.5
3.5
Fiscal 2023 and 2022 restructuring
2.1
0.2
2.4
0.4
5.1
Global ERP transformation
—
—
—
4.9
4.9
Russia closing initiatives
—
—
2.8
—
2.8
Other project costs
3.6
2.1
1.6
4.6
11.9
Non-cash purchase accounting
adjustments
—
—
0.9
—
0.9
Impairment of equipment and operating
lease assets
2.7
—
1.8
—
4.5
Impairment of intangible assets
—
48.0
19.0
—
67.0
Unallocated shared costs
—
—
—
12.5
12.5
Early settlement of foreign currency cash
flow hedges
—
—
3.9
—
3.9
Gain from remeasurement of contingent
consideration liability
—
—
(1.5
)
—
(1.5
)
HPC product recall
—
—
1.9
—
1.9
Other
3.3
0.1
0.3
1.3
5.0
Adjusted EBITDA
$
83.5
$
12.8
$
11.3
$
(16.8
)
$
90.8
Net sales
$
574.3
$
224.6
$
643.6
$
—
$
1,442.5
Net income (loss) from continuing
operations margin
9.3
%
(20.9
)%
(6.5
)%
—
%
(8.0
)%
Adjusted EBITDA margin
14.5
%
5.7
%
1.8
%
—
%
6.3
%
ADJUSTED DILUTED EPS
We define adjusted diluted earnings per share (EPS) as reported
diluted EPS excluding the effect of one-time, non-recurring
activity and volatility associated with our income tax expense. The
Company believes that adjusted diluted EPS provides further insight
and comparability in operating performance as it eliminates the
effects of certain items that are not comparable from one period to
the next. Adjustments to diluted EPS include the following:
- Incremental project costs associated with strategic
transactions, restructuring and optimization initiatives including,
but not limited to, the acquisition or divestitures of a business,
costs to effect and facilitate a transaction, including such cost
to integrate or separate the respective business, development and
implementation of strategies to optimize operations, reduce costs,
increase revenues, improve profit margins, including recognition of
one-time exit or disposal costs. These amounts are excluded from
our performance metrics as they are reflective of incremental
investment by the Company towards strategic initiatives and
business development activities, incremental costs directly
attributable to such initiatives and are not considered recurring
or reflective of the continuing ongoing operations of the
consolidated group or segments;
- Non-cash purchase accounting adjustments recognized in earnings
from continuing operations subsequent to an acquisition, including,
but not limited to, the costs attributable to the step-up in
inventory value and the incremental value in operating lease assets
with below market rent, among others During the three and six month
periods ended March 31, 2024 and April 2, 2023, the Company
recognized non-cash expense due to the incremental value recognized
as part of the Tristar Business acquisition on right of use
operating leases with below market rent;
- Non-cash asset impairments or write-offs realized and
recognized in earnings from continuing operations, including
impairments from property, plant and equipment, operating and
finance leases, and goodwill and other intangible assets, when
applicable. During the three and six month period ended March 31,
2024, the Company recognized impairments of its Rejuvenate® and a
non-core HPC tradename indefinite lived intangible assets, along
with an impairment charge on a right of use operating lease asset
associated with an HPC facility that was exited prior to end of its
term. During the three and six month period ended April 2, 2023,
the Company recognized impairment of indefinite lived intangible
assets for its Rejuvenate® and PowerXL® indefinite lived
tradenames, along with an impairment on idle equipment associated
with the early exit of a GPC warehouse lease and impairments on
right of use operating lease assets associated with GPC and HPC
facilities that were exited prior to the end of their term;
- Gain realized from proceeds received on the representation and
warranties insurance policies associated with the Tristar Business
acquisition;
- Incremental reserves for non-recurring litigation or
environmental remediation activity attributable to significant and
unusual nonrecurring matters with no previous history or precedent.
During the three and six month periods ended March 31, 2024, such
costs were directly attributable to legal costs incurred for the
proceeds received from the representation and warranties insurance
policies associated with the Tristar Business acquisition;
- Non-cash gain realized from the repurchase of debt obligations
at a discount, net deferred financing costs, during the three and
six month periods ended March 31, 2024;
- Incremental costs associated with the recognition of product
recall costs incurred by the HPC segment in collaboration with the
CPSC, initiated at the end of the year ended September 30 2022 and
during the year ending September 30, 2023, resulting in the accrual
and recognition of incremental costs for the recall, product
returns from customers, write-off of inventory on hand, and other
costs such as notification, shipping and handling, rework and
destruction of affected products, and consumer refunds, as needed.
Such costs are not recurring and directly attributable to the
recall event, excluding all other costs associated with product
warranty and returns. During the three and six month period ended
March 31, 2024, the Company was required by the CPSC to reissue a
previously issued recall to provide a cash refund to customers,
resulting in the recognition of incremental costs and
reserves;
- Unallocated shared costs reflect the costs associated with
certain shared and center-led administrative functions such as
information technology, human resources, finance and accounting,
supply chain and commercial operations, supporting the HHI business
during the period the Company owned and operated the business
through the close of the HHI divestiture on June 20, 2023. Such
costs are excluded from income from discontinued operations as they
are not a direct cost of the discontinued business but a result of
indirect allocations in accordance of US GAAP, but reflected as
part of income from continuing operations for all periods
presented, and requiring retroactive adjustment for all periods
presented. HHI was previously a segment of the consolidated group
and was excluded from the consolidated Adjusted EBITDA since being
recognized as discontinued operations. As a result, for all periods
in which HHI was owned and operated by the Company, including
comparable periods requiring retroactive adjustment, the adjustment
is recognized to reconcile net income from continuing operations to
Adjusted EBITDA of the remaining segments of the consolidated
group. With the close of the HHI divestiture on June 20, 2023,
there is no adjustment recognized as such shared costs are
mitigated through income from TSAs during the transition period
post-separation, with subsequent restructuring initiatives to
rightsize extraneous costs;
- Non-cash gain from the remeasurement in the contingent
consideration liability associated with the Tristar Business
acquisition during the six month period ended April 2, 2023;
- For the three and six month periods ended April 2, 2023, the
impact from the early settlement of foreign currency cash flow
hedges during the year ended September 30, 2022, resulting in
assumed losses at the original stated maturities of foreign
currency cash flow hedges in our EMEA region that were settled
early due to changes in the Company's legal entity organizational
structure and forecasted purchasing strategy of HPC finished goods
inventory within the region, resulting in excluded gains intended
to mitigate costs during the year ending September 30, 2023;
- Other adjustments are attributable to: (1) key executive
severance and other one-time compensatory costs; and (2)
non-recurring unusual insurable losses, including any the receipt
of insurance proceeds or recovery realized; and
- Income tax adjustment to diluted EPS is 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 of 25.0% for the three and six month periods
ended March 31, 2024 and April 2, 2023 based upon enacted corporate
tax rate in the United States.
SPECTRUM BRANDS HOLDINGS,
INC.
OTHER SUPPLEMENTAL INFORMATION
(Unaudited)
ADJUSTED DILUTED EPS
(continued)
The following is a reconciliation of
reported diluted EPS from continuing operations to adjusted diluted
EPS from continuing operations for the three and six month periods
ended March 31, 2024 and April 2, 2023.
Three Month Periods
Ended
Six Month Periods
Ended
(amounts per share)
March 31, 2024
April 2, 2023
March 31, 2024
April 2, 2023
Diluted EPS from continuing operations, as
reported
$
1.65
$
(1.83
)
$
2.09
$
(2.82
)
Adjustments:
HHI divestiture and separation costs
0.03
0.03
0.07
0.07
HPC separation initiatives
0.09
0.03
0.10
0.09
Tristar integration
—
0.10
—
0.24
Fiscal 2023 and 2022 restructuring
0.01
0.11
0.03
0.13
Global ERP transformation
0.13
0.08
0.21
0.12
Russia closing initiatives
—
—
—
0.07
Other project costs
—
0.15
—
0.30
Non-cash purchase accounting
adjustments
0.02
0.01
0.03
0.02
Impairment on equipment and operating
leases
0.02
0.10
0.02
0.11
Impairment on intangible assets
1.29
1.63
1.33
1.64
Representation and warranty insurance
proceeds
(2.14
)
—
(2.02
)
—
Legal and environmental
0.01
—
0.04
—
Gain on debt repurchase
—
—
(0.15
)
—
HPC product recalls
0.22
0.04
0.19
0.05
Unallocated shared costs
—
0.15
—
0.31
Early settlement of foreign currency cash
flow hedges
—
0.03
—
0.10
Gain from remeasurement contingent
consideration liability
—
—
—
(0.04
)
Debt amendment costs
—
—
—
0.06
Other
—
0.03
0.02
0.12
Pre-tax adjustments
$
(0.32
)
$
2.49
$
(0.13
)
$
3.39
Income tax adjustment
0.29
(0.80
)
0.40
(1.04
)
Total adjustments
$
(0.03
)
$
1.69
$
0.27
$
2.35
Diluted EPS from continuing operations, as
adjusted
$
1.62
$
(0.14
)
$
2.36
$
(0.47
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240508537488/en/
Investor/Media Contact: Joanne Chomiak 608-275-4458
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