Company Quick10K Filing
⚲
Fortune Brands
Financials
Price53.34 EPS3
Shares141 P/E18
MCap7,542 P/FCF21
Net Debt1,606 EBIT594
TEV9,148 TEV/EBIT15
TTM 2019-09-30, in MM, except price, ratios
Filings
10-Q 2020-09-30 Filed 2020-10-29
10-Q 2020-06-30 Filed 2020-07-31
10-Q 2020-03-31 Filed 2020-05-01
10-K 2019-12-31 Filed 2020-02-26
10-Q 2019-09-30 Filed 2019-10-31
10-Q 2019-06-30 Filed 2019-08-02
10-Q 2019-03-31 Filed 2019-05-07
10-K 2018-12-31 Filed 2019-02-25
10-Q 2018-09-30 Filed 2018-11-08
10-Q 2018-06-30 Filed 2018-07-31
10-Q 2018-03-31 Filed 2018-05-02
10-K 2017-12-31 Filed 2018-02-28
10-Q 2017-09-30 Filed 2017-10-31
10-Q 2017-06-30 Filed 2017-08-04
10-Q 2017-03-31 Filed 2017-05-02
10-K 2016-12-31 Filed 2017-02-28
10-Q 2016-09-30 Filed 2016-11-02
10-Q 2016-06-30 Filed 2016-08-04
10-Q 2016-03-31 Filed 2016-04-28
10-K 2015-12-31 Filed 2016-02-25
10-Q 2015-09-30 Filed 2015-10-30
10-Q 2015-06-30 Filed 2015-07-29
10-Q 2015-03-31 Filed 2015-05-05
10-K 2014-12-31 Filed 2015-02-25
10-Q 2014-09-30 Filed 2014-10-31
10-Q 2014-06-30 Filed 2014-07-31
10-Q 2014-03-31 Filed 2014-05-01
10-K 2013-12-31 Filed 2014-02-26
10-Q 2013-09-30 Filed 2013-11-01
10-Q 2013-06-30 Filed 2013-07-31
10-Q 2013-03-31 Filed 2013-05-03
10-K 2012-12-31 Filed 2013-02-27
10-Q 2012-09-30 Filed 2012-11-05
10-Q 2012-06-30 Filed 2012-08-07
10-Q 2012-03-31 Filed 2012-05-04
10-K 2011-12-31 Filed 2012-02-22
10-Q 2011-09-30 Filed 2011-11-10
Reports
8-K 2020-11-16 Enter Agreement, Exhibits
8-K 2020-10-28 Earnings, Exhibits
8-K 2020-09-21 Other Events, Exhibits
8-K 2020-07-29 Earnings, Exhibits
8-K 2020-07-13 Exhibits
8-K 2020-04-29
8-K 2020-04-28
8-K 2020-01-29
8-K 2019-10-23
8-K 2019-10-07
8-K 2019-09-30
8-K 2019-09-24
8-K 2019-09-09
8-K 2019-08-01
8-K 2019-07-26
8-K 2019-05-07
8-K 2019-04-24
8-K 2019-03-05
8-K 2019-02-21
8-K 2019-01-31
8-K 2018-10-25
8-K 2018-09-19
8-K 2018-07-26
8-K 2018-07-13
8-K 2018-04-30
8-K 2018-04-26
8-K 2018-02-01

FBHS 10Q Quarterly Report

Content
Part I. Financial Information
Item 1. Financial Statements.
Item 2. Fortune Brands Home & Security, Inc.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Item 4. Controls and Procedures.
Part II. Other Information
Item 1. Legal Proceedings.
Item 1A. Risk Factors.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Item 6. Exhibits
Exhibits
EX-31.1 fbhs-ex311_6.htm
EX-31.2 fbhs-ex312_8.htm
EX-32 fbhs-ex32_7.htm

Fortune Brands Earnings 2020-09-30

Balance SheetIncome StatementCash Flow
10.08.06.04.02.00.02012201420172020
Assets, Equity
 1.61.30.90.60.2-0.12012201420172020
Rev, G Profit, Net Income
 0.70.40.1-0.1-0.4-0.72012201420172020
Ops, Inv, Fin
fbhs-10q_20200930.htm
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

Form 10-Q

 

☒

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2020

 

OR

 

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from         to         

 

Commission file number 1-35166

 

FORTUNE BRANDS HOME & SECURITY, INC.

 

(Exact name of Registrant as specified in its charter)

 

 

Delaware

 

62-1411546

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

520 Lake Cook Road, Deerfield, Illinois 60015-5611

 

(Address of principal executive offices) (Zip Code)

 

Registrant’s telephone number, including area code: (847) 484-4400

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock

FBHS

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes    ☒     No   ☐

 

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No  

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

☒

 

Accelerated filer

☐

Non-accelerated filer

☐

 

Smaller reporting company

☐

Emerging growth company

☐

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes    ☐    No    ☒

 

The number of shares outstanding of the registrant’s common stock, par value $0.01 per share, at October 16, 2020 was 138,928,712.

 

 

 

PART I.  FINANCIAL INFORMATION

Item 1.

FINANCIAL STATEMENTS.

FORTUNE BRANDS HOME & SECURITY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the Nine and Three Months Ended September 30, 2020 and 2019

(In millions, except per share amounts)

(Unaudited)

 

 

 

Nine Months Ended

 

 

Three Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Net sales

 

$

4,430.6

 

 

$

4,294.1

 

 

$

1,652.1

 

 

$

1,459.0

 

Cost of products sold

 

 

2,873.9

 

 

 

2,773.5

 

 

 

1,071.5

 

 

 

934.8

 

Selling, general and administrative expenses

 

 

918.4

 

 

 

943.9

 

 

 

328.3

 

 

 

311.3

 

Amortization of intangible assets

 

 

31.1

 

 

 

30.0

 

 

 

10.5

 

 

 

9.9

 

Asset impairment charges

 

 

22.5

 

 

 

29.5

 

 

 

—

 

 

 

29.5

 

Restructuring charges

 

 

16.5

 

 

 

11.2

 

 

 

1.6

 

 

 

5.5

 

Operating income

 

 

568.2

 

 

 

506.0

 

 

 

240.2

 

 

 

168.0

 

Interest expense

 

 

64.4

 

 

 

71.8

 

 

 

20.1

 

 

 

23.6

 

Other income, net

 

 

(13.4

)

 

 

(2.2

)

 

 

(2.1

)

 

 

(0.3

)

Income before taxes

 

 

517.2

 

 

 

436.4

 

 

 

222.2

 

 

 

144.7

 

Income tax

 

 

121.7

 

 

 

109.1

 

 

 

54.0

 

 

 

39.0

 

Income after tax

 

 

395.5

 

 

 

327.3

 

 

 

168.2

 

 

 

105.7

 

Equity in losses of affiliate

 

 

4.7

 

 

 

—

 

 

 

2.4

 

 

 

—

 

Net income

 

 

390.8

 

 

 

327.3

 

 

 

165.8

 

 

 

105.7

 

Less: Noncontrolling interests

 

 

1.3

 

 

 

(0.5

)

 

 

1.2

 

 

 

0.1

 

Net income attributable to Fortune Brands

 

$

389.5

 

 

$

327.8

 

 

$

164.6

 

 

$

105.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

 

$

2.81

 

 

$

2.34

 

 

$

1.19

 

 

$

0.76

 

Diluted earnings per common share

 

$

2.78

 

 

$

2.32

 

 

$

1.17

 

 

$

0.75

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive income

 

$

371.9

 

 

$

327.4

 

 

$

184.6

 

 

$

94.3

 

 

See notes to condensed consolidated financial statements.


 

2

FORTUNE BRANDS HOME & SECURITY, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions)

(Unaudited)

 

 

 

September 30,

2020

 

 

December 31,

2019

 

Assets

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

464.5

 

 

$

387.9

 

Accounts receivable less allowances for discounts and doubtful accounts

 

 

765.2

 

 

 

624.8

 

Inventories

 

 

738.3

 

 

 

718.6

 

Other current assets

 

 

170.0

 

 

 

166.9

 

Total current assets

 

 

2,138.0

 

 

 

1,898.2

 

Property, plant and equipment, net of accumulated depreciation

 

 

791.7

 

 

 

824.2

 

Operating lease assets

 

 

166.9

 

 

 

165.6

 

Goodwill

 

 

2,085.2

 

 

 

2,090.2

 

Other intangible assets, net of accumulated amortization

 

 

1,111.2

 

 

 

1,168.9

 

Other assets

 

 

226.0

 

 

 

144.2

 

Total assets

 

$

6,519.0

 

 

$

6,291.3

 

Liabilities and equity

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Short-term debt

 

$

—

 

 

$

399.7

 

Accounts payable

 

 

544.1

 

 

 

460.0

 

Other current liabilities

 

 

590.9

 

 

 

549.6

 

Total current liabilities

 

 

1,135.0

 

 

 

1,409.3

 

Long-term debt

 

 

2,086.5

 

 

 

1,784.6

 

Deferred income taxes

 

 

149.2

 

 

 

157.2

 

Accrued defined benefit plans

 

 

180.2

 

 

 

201.4

 

Operating lease liabilities

 

 

139.1

 

 

 

139.8

 

Other non-current liabilities

 

 

200.4

 

 

 

171.2

 

Total liabilities

 

 

3,890.4

 

 

 

3,863.5

 

Commitments and contingencies (see Note 17)

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

 

 

Fortune Brands equity

 

 

 

 

 

 

 

 

Common stock(a)

 

 

1.8

 

 

 

1.8

 

Paid-in capital

 

 

2,903.3

 

 

 

2,813.8

 

Accumulated other comprehensive loss

 

 

(91.5

)

 

 

(72.6

)

Retained earnings

 

 

2,052.7

 

 

 

1,763.0

 

Treasury stock

 

 

(2,237.7

)

 

 

(2,079.4

)

Total Fortune Brands equity

 

 

2,628.6

 

 

 

2,426.6

 

Noncontrolling interests

 

 

—

 

 

 

1.2

 

Total equity

 

 

2,628.6

 

 

 

2,427.8

 

Total liabilities and equity

 

$

6,519.0

 

 

$

6,291.3

 

 

(a)

Common stock, par value $0.01 per share; 183.8 million shares and 181.9 million shares issued at September 30, 2020 and December 31, 2019, respectively.

 

See notes to condensed consolidated financial statements.


 

3

FORTUNE BRANDS HOME & SECURITY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Nine Months Ended September 30, 2020 and 2019

(In millions)

(Unaudited)

 

 

 

2020

 

 

2019

 

Operating activities

 

 

 

 

 

 

 

 

Net income

 

$

390.8

 

 

$

327.3

 

Non-cash pre-tax expense:

 

 

 

 

 

 

 

 

Depreciation

 

 

85.8

 

 

 

82.7

 

Amortization of intangibles

 

 

31.1

 

 

 

30.0

 

Non-cash lease expense

 

 

26.6

 

 

 

26.5

 

Stock-based compensation

 

 

33.5

 

 

 

22.9

 

Recognition of actuarial losses

 

 

0.6

 

 

 

2.1

 

Deferred taxes

 

 

(17.0

)

 

 

(1.8

)

Asset impairment charges

 

 

22.5

 

 

 

31.2

 

Amortization of deferred financing fees

 

 

3.3

 

 

 

2.4

 

Equity in losses of affiliate

 

 

4.7

 

 

 

—

 

Gain on equity investments

 

 

(6.6

)

 

 

—

 

Loss (gain) on sale of property, plant and equipment

 

 

1.3

 

 

 

(1.0

)

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

Increase in accounts receivable

 

 

(164.4

)

 

 

(68.4

)

Increase in inventories

 

 

(20.5

)

 

 

(81.2

)

Increase (decrease) in accounts payable

 

 

88.5

 

 

 

(11.1

)

Increase in other assets

 

 

(21.2

)

 

 

(18.3

)

Increase in accrued expenses and other liabilities

 

 

25.0

 

 

 

6.0

 

Increase in accrued taxes

 

 

22.8

 

 

 

4.5

 

Net cash provided by operating activities

 

 

506.8

 

 

 

353.8

 

Investing activities

 

 

 

 

 

 

 

 

Capital expenditures (a)

 

 

(66.2

)

 

 

(82.4

)

Proceeds from the disposition of assets

 

 

1.5

 

 

 

4.2

 

Cost of investments in equity securities

 

 

(59.4

)

 

 

—

 

Other investing activities, net

 

 

—

 

 

 

0.1

 

Net cash used in investing activities

 

 

(124.1

)

 

 

(78.1

)

Financing activities

 

 

 

 

 

 

 

 

Decrease in short-term debt

 

 

—

 

 

 

(525.0

)

Issuance of long-term debt

 

 

1,020.0

 

 

 

1,494.3

 

Repayment of long-term debt

 

 

(1,120.0

)

 

 

(955.0

)

Proceeds from the exercise of stock options

 

 

56.0

 

 

 

6.9

 

Treasury stock purchases

 

 

(150.0

)

 

 

(100.0

)

Employee withholding taxes related to stock-based compensation

 

 

(8.3

)

 

 

(8.5

)

Deferred acquisition payments

 

 

—

 

 

 

(19.0

)

Dividends to stockholders

 

 

(99.9

)

 

 

(92.3

)

Dividends paid to non-controlling interests

 

 

(2.5

)

 

 

—

 

Other financing, net

 

 

(4.1

)

 

 

(3.3

)

Net cash used in financing activities

 

 

(308.8

)

 

 

(201.9

)

Effect of foreign exchange rate changes on cash

 

 

1.9

 

 

 

(1.2

)

Net increase in cash and cash equivalents

 

$

75.8

 

 

$

72.6

 

Cash, cash equivalents and restricted cash(b) at beginning of period

 

$

394.9

 

 

$

270.7

 

Cash, cash equivalents and restricted cash(b) at end of period

 

$

470.7

 

 

$

343.3

 

 

(a)

Capital expenditures of $3.5 million and $9.0 million that had not been paid as of September 30, 2020 and 2019, respectively, were excluded from the Statement of Cash Flows.

(b)

Restricted cash of $1.0 million and $5.2 million is included in Other current assets and Other assets, respectively, as of September 30, 2020 and restricted cash of $0.8 million and $6.3 million is included in Other current assets and Other assets, respectively, as of September 30, 2019.  Restricted cash of $0.8 million and $6.1 million is included in Other current assets and Other assets, respectively, as of December 31, 2019.

See notes to condensed consolidated financial statements.

 

4

FORTUNE BRANDS HOME & SECURITY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

For the Nine and Three Months Ended September 30, 2020 and 2019

(In millions)

(Unaudited)

 

 

 

Common

Stock

 

 

Paid-In

Capital

 

 

Accumulated

Other

Comprehensive

(Loss) Income

 

 

Retained

Earnings

 

 

Treasury

Stock

 

 

Non-

controlling

Interests

 

 

Total

Equity

 

Balance at December 31, 2018

 

$

1.8

 

 

$

2,766.0

 

 

$

(67.0

)

 

$

1,448.1

 

 

$

(1,970.7

)

 

$

1.8

 

 

$

2,180.0

 

Comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

—

 

 

 

—

 

 

 

—

 

 

 

327.8

 

 

 

—

 

 

 

(0.5

)

 

 

327.3

 

Other comprehensive income (loss)

 

 

—

 

 

 

—

 

 

 

0.1

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

0.1

 

Stock options exercised

 

 

—

 

 

 

6.9

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

6.9

 

Stock-based compensation

 

 

—

 

 

 

22.9

 

 

 

—

 

 

 

—

 

 

 

(8.5

)

 

 

—

 

 

 

14.4

 

Adoption of ASU 2018-02

 

 

—

 

 

 

—

 

 

 

(8.6

)

 

 

8.6

 

 

 

—

 

 

 

—

 

 

 

—

 

Treasury stock purchases

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(100.0

)

 

 

—

 

 

 

(100.0

)

Dividends ($0.66 per common share)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(92.0

)

 

 

—

 

 

 

—

 

 

 

(92.0

)

Balance at September 30, 2019

 

$

1.8

 

 

$

2,795.8

 

 

$

(75.5

)

 

$

1,692.5

 

 

$

(2,079.2

)

 

$

1.3

 

 

$

2,336.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2019

 

$

1.8

 

 

$

2,813.8

 

 

$

(72.6

)

 

$

1,763.0

 

 

$

(2,079.4

)

 

$

1.2

 

 

$

2,427.8

 

Comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
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