Company Quick10K Filing
Quick10K
Spectrum Brands Holdings
10-Q 2018-12-30 Quarter: 2018-12-30
10-K 2018-09-30 Annual: 2018-09-30
10-Q 2018-06-30 Quarter: 2018-06-30
10-Q 2018-03-31 Quarter: 2018-03-31
10-Q 2017-12-31 Quarter: 2017-12-31
10-K 2017-09-30 Annual: 2017-09-30
10-Q 2017-06-30 Quarter: 2017-06-30
10-Q 2017-03-31 Quarter: 2017-03-31
10-Q 2016-12-31 Quarter: 2016-12-31
10-K 2016-09-30 Annual: 2016-09-30
10-Q 2016-06-30 Quarter: 2016-06-30
10-Q 2016-03-31 Quarter: 2016-03-31
10-Q 2015-12-31 Quarter: 2015-12-31
10-K 2015-09-30 Annual: 2015-09-30
10-Q 2015-06-30 Quarter: 2015-06-30
10-Q 2015-03-31 Quarter: 2015-03-31
10-Q 2014-12-31 Quarter: 2014-12-31
10-K 2014-09-30 Annual: 2014-09-30
10-Q 2014-06-30 Quarter: 2014-06-30
10-Q 2014-03-31 Quarter: 2014-03-31
10-Q 2013-12-31 Quarter: 2013-12-31
8-K 2019-03-13 Other Events
8-K 2019-02-19 Regulation FD, Exhibits
8-K 2019-02-07 Earnings, Exhibits
8-K 2019-01-28 Enter Agreement, M&A, Regulation FD, Other Events, Exhibits
8-K 2019-01-23 Regulation FD, Exhibits
8-K 2019-01-23 Regulation FD, Exhibits
8-K 2019-01-02 M&A, Officers, Regulation FD, Exhibits
8-K 2018-12-31 Regulation FD, Exhibits
8-K 2018-12-11 Other Events, Exhibits
8-K 2018-11-19 Earnings, Exhibits
8-K 2018-11-15 Enter Agreement, Regulation FD, Exhibits
8-K 2018-10-26 Officers, Regulation FD, Other Events, Exhibits
8-K 2018-09-12 Officers, Other Events
8-K 2018-07-26 Earnings, Exhibits
8-K 2018-07-13 M&A, Shareholder Rights, Officers, Amend Bylaw, Shareholder Vote, Regulation FD, Exhibits
8-K 2018-07-02 Regulation FD
8-K 2018-06-12 Shareholder Vote
8-K 2018-06-08 Enter Agreement, Other Events, Exhibits
8-K 2018-04-10 Regulation FD
8-K 2018-03-30 Other Events, Exhibits
8-K 2018-02-24 Enter Agreement, Shareholder Rights, Amend Bylaw, Regulation FD, Exhibits
8-K 2018-02-22 Regulation FD
8-K 2018-01-16 Other Events
8-K 2018-01-11 Regulation FD
VCNX Vaccinex 0
NTRR Neutra 0
KB KB Financial Group 0
PKD Parker Drilling 0
PFMT Performant Financial 0
DGX Quest Diagnostics 0
DEA Easterly Government Properties 0
LULU Lululemon 0
NAK Northern Dynasty Minerals 0
GSAH GS Acquisition Holdings 0
SPB 2018-12-30
Part I. Financial Information
Item 1. Financial Statements
Note 1 - Description of Business
Note 2 – Basis of Presentation and Significant Accounting Policies
Note 3 – Divestitures
Note 4 – Acquisitions
Note 5 - Restructuring and Related Charges
Note 6 – Revenue Recognition
Note 7 - Receivables and Concentration of Credit Risk
Note 8 - Inventories
Note 9 – Property, Plant and Equipment
Note 10 - Goodwill and Intangible Assets
Note 11 - Debt
Note 12 - Derivatives
Note 13 - Fair Value of Financial Instruments
Note 14 - Employee Benefit Plans
Note 15 - Share Based Compensation
Note 16 - Income Taxes
Note 17 – Related Party Transactions
Note 18 - Commitments and Contingencies
Note 19 - Segment Information
Note 20 - Earnings per Share - Sbh
Note 21 - Guarantor Statements – Sb/Rh
Item 2. Management’S Discussion and Analysis of Financial Condition and Results of Operations
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 5. Other Information
Item 6. Exhibits
EX-10.2 spb-20181230xex10_2.htm
EX-31.1 spb-20181230xex31_1.htm
EX-31.2 spb-20181230xex31_2.htm
EX-31.3 spb-20181230xex31_3.htm
EX-31.4 spb-20181230xex31_4.htm
EX-32.1 spb-20181230xex32_1.htm
EX-32.2 spb-20181230xex32_2.htm
EX-32.3 spb-20181230xex32_3.htm
EX-32.4 spb-20181230xex32_4.htm

Spectrum Brands Holdings Earnings 2018-12-30

SPB 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

10-Q 1 spb-20181230x10q.htm 10-Q 20181230 FORM 10Q Q1FY19

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 December 30, 2018



OR



TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from             to           





\

 

 

 

 



 

Picture 1

 

 

Commission File No.

 

Name of Registrant, State of Incorporation,

Address of Principal Offices, and Telephone No.

 

IRS Employer Identification No.

1-4219

 

Spectrum Brands Holdings, Inc.

(a Delaware corporation)

3001 Deming Way

Middleton, WI 53562

(608) 275-3340

www.spectrumbrands.com

 

 

74-1339132

333-192634-03

 

SB/RH Holdings, LLC

(a Delaware limited liability company)

3001 Deming Way

Middleton, WI 53562

(608) 275-3340

 

27-2812840



Indicate by check mark whether the registrants (1) have 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.



 

 

 

 

 

 



Spectrum Brands Holdings, Inc.

Yes

No

 



SB/RH Holdings, LLC

Yes

No

 



Indicate by check mark whether the registrants have submitted electronically every Interactive Data File required to be submitted and posted 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 and post such files). 



 

 

 

 

 

 



Spectrum Brands Holdings, Inc.

Yes

No

 



SB/RH Holdings, LLC

Yes

No

 



Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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. (Check one):



 

 

 

 

 

 

 

 

 

Registrant

 

Large Accelerated Filer

 

Accelerated filer

 

Non-accelerated filer

 

Smaller reporting company

Spectrum Brands Holdings, Inc.

 

X

 

 

 

 

 

 

SB/RH Holdings, LLC

 

 

 

 

 

X

 

 



Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

 

 

 

 

 

 



Spectrum Brands Holdings, Inc.

Yes

No

 



SB/RH Holdings, LLC

Yes

No

 



Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§232.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter



 

 

 

 

 

 



Spectrum Brands Holdings, Inc.

Yes

No

 



SB/RH Holdings, LLC

Yes

No

 



If an emerging growth company, indicate by checkmark 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.



 

 

 

 

 

 



Spectrum Brands Holdings, Inc.

 

 

 

 



SB/RH Holdings, LLC

 

 

 

 



As of February 4, 2019, there were outstanding  53,716,193 shares of Spectrum Brands Holdings, Inc.’s common stock, par value $0.01 per share.



SB/RH Holdings, LLC meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this report with a reduced disclosure format as permitted by general instruction H(2).

 

 


 

Forward-Looking Statements



We have made or implied certain forward-looking statements in this report. All statements, other than statements of historical facts included in this report, including the statements under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding our business strategy, future operations, financial condition, estimated revenues, projected costs, projected synergies, prospects, plans and objectives of management, as well as information concerning expected actions of third parties, are forward-looking statements. When used in this report, the words anticipate,  intend,  plan,  estimate,  believe,  expect,  project,  could,  will,  should,  may and similar expressions are also 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:



·

the impact of our indebtedness on our business, financial condition and results of operations;

·

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;

·

any failure to comply with financial covenants and other provisions and restrictions of our debt instruments;

·

the impact of actions taken by significant stockholders;

·

the impact of fluctuations in commodity prices, costs or availability of raw materials or terms and conditions available from suppliers, including suppliers’ willingness to advance credit;

·

interest rate and exchange rate fluctuations;

·

the loss of, significant reduction in, or dependence upon, sales to any significant retail customer(s);

·

competitive promotional activity or spending by competitors, or price reductions by competitors;

·

the introduction of new product features or technological developments by competitors and/or the development of new competitors or competitive brands;

·

the effects of general economic conditions, including inflation, recession or fears of a recession, depression or fears of a depression, labor costs and stock market volatility or changes in trade, monetary or fiscal policies in the countries where we do business;

·

changes in consumer spending preferences and demand for our products;

·

our ability to develop and successfully introduce new products, protect our intellectual property and avoid infringing the intellectual property of third parties;

·

our ability to successfully implement, achieve and sustain manufacturing and distribution cost efficiencies and improvements, and fully realize anticipated cost savings;

·

the seasonal nature of sales of certain of our products;

·

the effects of climate change and unusual weather activity;

·

the cost and effect of unanticipated legal, tax or regulatory proceedings or new laws or regulations (including environmental, public health and consumer protection regulations);

·

public perception regarding the safety of products, that we manufacture or sell, including the potential for environmental liabilities, product liability claims, litigation and other claims related to products manufactured by us and third parties;

·

the impact of pending or threatened litigation;

·

the impact of cybersecurity breaches or our actual or perceived failure to protect company and personal data;

·

changes in accounting policies applicable to our business;

·

our ability to utilize our net operating loss carry-forwards to offset tax liabilities from future taxable income;

·

government regulations;

·

the impact of expenses resulting from the implementation of new business strategies, divestitures or current and proposed restructuring activities;

·

our inability to successfully integrate and operate new acquisitions at the level of financial performance anticipated;

·

the unanticipated loss of key members of senior management;

·

the effects of political or economic conditions, terrorist attacks, acts of war or other unrest in international markets; and 

·

the transition to a new chief executive officer and such officer’s ability to determine and implement changes at the Company to improve the Company’s business and financial performance.



Some of the above-mentioned factors are described in further detail in the sections entitled “Risk Factors” in our annual and quarterly reports (including this report), as applicable. You should assume the information appearing in this report is accurate only as of the end of the period covered by this report, 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 (“U.S.”) and the rules and regulations of the United States Securities and Exchange Commission (“SEC”), 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.

SB/RH HOLDINGS, LLC

TABLE OF CONTENTS



This report is a combined report of Spectrum Brands Holdings, Inc. and SB/RH Holdings, LLC. The combined notes to the condensed consolidated financial statements include notes representing Spectrum Brands Holdings, Inc. and SB/RH Holdings, LLC and certain notes related specifically to SB/RH Holdings, LLC.





 

 

PART I

FINANCIAL INFORMATION

Page

Item 1.

Financial Statements

Spectrum Brands Holdings, Inc. Condensed Consolidated Financial Statements (Unaudited)



Condensed Consolidated Statements of Financial Position as of December 30, 2018 and September 30, 2018



Condensed Consolidated Statements of Income for the three month periods ended December 30, 2018 and December 31, 2017



Condensed Consolidated Statements of Comprehensive Income for the three month periods ended December 30, 2018 and December 31, 2017



Condensed Consolidated Statement of Shareholders’ Equity for the three month periods ended December 30, 2018 and December 31, 2017



Condensed Consolidated Statements of Cash Flows for the three month periods ended December 30, 2018 and December 31, 2017

SB/RH Holdings, LLC Condensed Consolidated Financial Statements (Unaudited)



Condensed Consolidated Statements of Financial Position as of December 30, 2018 and September 30, 2018



Condensed Consolidated Statements of Income for the three month periods ended December 30, 2018 and December 31, 2017



Condensed Consolidated Statements of Comprehensive Income for the three month periods ended December 30, 2018 and December 31, 2017



Condensed Consolidated Statement of Shareholder’s Equity for the three month periods ended December 30, 2018 and December 31, 2017

10 



Condensed Consolidated Statements of Cash Flows for the three month periods ended December 30, 2018 and December 31, 2017

11 

Spectrum Brands Holdings, Inc. and SB/RH Holdings, LLC Combined (Unaudited)



Combined Notes to Condensed Consolidated Financial Statements

12 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

36 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

43 

Item 4.

Controls and Procedures

44 

PART II

OTHER INFORMATION

 

Item 1.

Legal Proceedings

45 

Item 1A.

Risk Factors

45 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

45 

Item 5.

Other Information

45 

Item 6.

Exhibits

45 

Signatures

 

46 



1

 


 

PART I. FINANCIAL INFORMATION



Item 1. Financial Statements

SPECTRUM BRANDS HOLDINGS, INC. 

Condensed Consolidated Statements of Financial Position

As of December 30, 2018, and September 30, 2018 

(unaudited)





 

 

 

 

 

 



 

 

 

 

 

 

(in millions)

 

December 30, 2018

 

September 30, 2018

Assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

252.4 

 

$

552.5 

Trade receivables, net

 

 

414.0 

 

 

316.9 

Other receivables

 

 

68.7 

 

 

51.8 

Inventories

 

 

723.2 

 

 

583.6 

Prepaid expenses and other current assets

 

 

62.6 

 

 

63.2 

Current assets of business held for sale

 

 

2,283.4 

 

 

2,406.3 

Total current assets

 

 

3,804.3 

 

 

3,974.3 

Property, plant and equipment, net

 

 

477.7 

 

 

499.1 

Deferred charges and other

 

 

219.0 

 

 

230.5 

Goodwill

 

 

1,447.4 

 

 

1,454.7 

Intangible assets, net

 

 

1,603.1 

 

 

1,641.8 

Total assets

 

$

7,551.5 

 

$

7,800.4 

Liabilities and Shareholders' Equity

 

 

 

 

 

 

Current portion of long-term debt

 

$

2,138.2 

 

$

26.9 

Accounts payable

 

 

471.4 

 

 

585.0 

Accrued wages and salaries

 

 

48.2 

 

 

55.3 

Accrued interest

 

 

76.9 

 

 

65.0 

Other current liabilities

 

 

203.5 

 

 

158.7 

Current liabilities of business held for sale

 

 

463.2 

 

 

539.1 

Total current liabilities

 

 

3,401.4 

 

 

1,430.0 

Long-term debt, net of current portion

 

 

2,589.3 

 

 

4,624.3 

Deferred income taxes

 

 

35.0 

 

 

35.0 

Other long-term liabilities

 

 

119.9 

 

 

121.5 

Total liabilities

 

 

6,145.6 

 

 

6,210.8 

Commitments and contingencies (Note 18)

 

 

 

 

 

 

Shareholders' equity

 

 

 

 

 

 

Common Stock

 

 

0.5 

 

 

0.5 

Additional paid-in capital

 

 

2,007.4 

 

 

1,996.7 

Accumulated deficit

 

 

(349.1)

 

 

(180.1)

Accumulated other comprehensive loss, net of tax

 

 

(246.8)

 

 

(235.8)

Treasury stock, at cost

 

 

(14.6)

 

 

Total shareholders' equity

 

 

1,397.4 

 

 

1,581.3 

Noncontrolling interest

 

 

8.5 

 

 

8.3 

Total equity

 

 

1,405.9 

 

 

1,589.6 

Total liabilities and equity

 

$

7,551.5 

 

$

7,800.4 

See accompanying notes to the condensed consolidated financial statements

2

 


 

SPECTRUM BRANDS HOLDINGS, INC. 

Condensed Consolidated Statements of Income

For the three month periods ended December 30, 2018 and December 31, 2017

 (unaudited)





 

 

 

 

 

 



 

Three Month Periods Ended

(in millions, except per share)

 

December 30, 2018

 

December 31, 2017

Revenue

 

$

874.6 

 

$

919.6 

Cost of goods sold

 

 

568.4 

 

 

600.9 

Restructuring and related charges

 

 

0.9 

 

 

0.3 

Gross profit

 

 

305.3 

 

 

318.4 

Selling

 

 

155.6 

 

 

153.8 

General and administrative

 

 

104.0 

 

 

79.7 

Research and development

 

 

11.1 

 

 

11.5 

Acquisition and integration related charges

 

 

1.6 

 

 

5.3 

Restructuring and related charges

 

 

8.2 

 

 

16.8 

Total operating expenses

 

 

280.5 

 

 

267.1 

Operating income

 

 

24.8 

 

 

51.3 

Interest expense

 

 

57.0 

 

 

75.4 

Other non-operating expense (income), net

 

 

0.7 

 

 

(0.8)

Loss from continuing operations before income taxes

 

 

(32.9)

 

 

(23.3)

Income tax benefit

 

 

(3.4)

 

 

(120.5)

Net (loss) income from continuing operations

 

 

(29.5)

 

 

97.2 

(Loss) income from discontinued operations, net of tax

 

 

(82.8)

 

 

481.6 

Net (loss) income

 

 

(112.3)

 

 

578.8 

Net income attributable to non-controlling interest

 

 

0.2 

 

 

71.4 

Net (loss) income attributable to controlling interest

 

$

(112.5)

 

$

507.4 

Amounts attributable to controlling interest

 

 

 

 

 

 

Net (loss) income from continuing operations attributable to controlling interest

 

$

(29.7)

 

$

40.0 

Net (loss) income from discontinued operations attributable to controlling interest

 

 

(82.8)

 

 

467.4 

Net (loss) income attributable to controlling interest

 

$

(112.5)

 

$

507.4 

Earnings Per Share

 

 

 

 

 

 

Basic earnings per share from continuing operations

 

$

(0.56)

 

$

1.24 

Basic earnings per share from discontinued operations

 

 

(1.55)

 

 

14.45 

Basic earnings per share

 

$

(2.11)

 

$

15.69 

Diluted earnings per share from continuing operations

 

$

(0.56)

 

$

1.23 

Diluted earnings per share from discontinued operations

 

 

(1.55)

 

 

14.32 

Diluted earnings per share

 

$

(2.11)

 

$

15.55 

Dividends per share

 

$

0.42 

 

$

Weighted Average Shares Outstanding

 

 

 

 

 

 

Basic

 

 

53.4 

 

 

32.3 

Diluted

 

 

53.4 

 

 

32.6 



See accompanying notes to the condensed consolidated financial statements

3

 


 



SPECTRUM BRANDS HOLDINGS, INC

Condensed Consolidated Statements of Comprehensive Income

For the three month periods ended December 30, 2018 and December 31, 2017

(unaudited)





 

 

 

 

 

 



 

Three Month Periods Ended

(in millions)

 

December 30, 2018

 

December 31, 2017

Net (loss) income

 

$

(112.3)

 

$

578.8 

Other comprehensive income (loss)

 

 

 

 

 

 

Foreign currency translation loss

 

 

(18.7)

 

 

(9.3)

   Deferred tax effect

 

 

(2.1)

 

 

7.2 

   Deferred tax valuation allowance

 

 

 

 

0.1 

   Net unrealized loss on foreign currency translation

 

 

(20.8)

 

 

(2.0)

Unrealized gain on derivative instruments

 

 

 

 

 

 

Unrealized gain (loss) on hedging activity before reclassification

 

 

14.4 

 

 

(0.8)

Net reclassification for (gain) loss to income from continuing operations

 

 

(2.9)

 

 

2.9 

Net reclassification for gain to income from discontinued operations

 

 

(0.1)

 

 

(0.3)

   Unrealized gain on hedging instruments after reclassification

 

 

11.4 

 

 

1.8 

   Deferred tax effect

 

 

(3.1)

 

 

   Net unrealized gain on hedging derivative instruments

 

 

8.3 

 

 

1.8 

Defined benefit pension gain

 

 

 

 

 

 

Defined benefit pension gain (loss) before reclassification

 

 

1.1 

 

 

(0.7)

Net reclassification for loss to income from continuing operations

 

 

0.5 

 

 

0.6 

Net reclassification for loss to income from discontinued operations

 

 

0.2 

 

 

0.2 

   Defined benefit pension gain after reclassification

 

 

1.8 

 

 

0.1 

   Deferred tax effect

 

 

(0.3)

 

 

   Net defined benefit pension gain

 

 

1.5 

 

 

0.1 

Unrealized investment gain

 

 

 

 

 

 

Unrealized investment gain before reclassification

 

 

 

 

26.0 

Net reclassification for gain to income from discontinued operations

 

 

 

 

(6.3)

   Unrealized gain on investments after reclassification

 

 

 

 

19.7 

Adjustments to intangible assets

 

 

 

 

(0.9)

Deferred tax effect

 

 

 

 

(6.7)

Net unrealized gain on investments

 

 

 

 

12.1 

Deconsolidation of HRG insurance operations

 

 

 

 

(445.9)

Net change to derive comprehensive income for the period

 

 

(11.0)

 

 

(433.9)

Comprehensive (loss) income

 

 

(123.3)

 

 

144.9 

Comprehensive income attributable to non-controlling interest

 

 

 

 

2.5 

Comprehensive (loss) income attributable to controlling interest

 

$

(123.3)

 

$

142.4 



See accompanying notes to the condensed consolidated financial statements

4

 


 







SPECTRUM BRANDS HOLDINGS, INC

Condensed Consolidated Statements of Shareholder’s Equity

For the three month periods ended December 30, 2018 and December 31, 2017

(unaudited)











 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

Additional

 

 

 

Other

 

 

 

Total

 

Non-

 

 

Three month period ended December 30, 2018

 

Common Stock

 

Paid-in

 

Accumulated

 

Comprehensive

 

Treasury

 

Shareholders'

 

controlling

 

Total

(in millions)

 

Shares

 

Amount

 

Capital

 

Deficit

 

Loss

 

Stock

 

Equity

 

Interest

 

Equity

Balances as of September 30, 2018

 

53.4 

 

 

0.5 

 

 

1,996.7 

 

 

(180.1)

 

 

(235.8)

 

 

 

 

1,581.3 

 

 

8.3 

 

 

1,589.6 

Net loss from continuing operations

 

 

 

 

 

 

 

(29.7)

 

 

 

 

 

 

(29.7)

 

 

0.2 

 

 

(29.5)

Loss from discontinued operations, net of tax

 

 

 

 

 

 

 

(82.8)

 

 

 

 

 

 

(82.8)

 

 

 

 

(82.8)

Other comprehensive loss, net of tax

 

 

 

 

 

 

 

 

 

(11.0)

 

 

 

 

(11.0)

 

 

 

 

(11.0)

Treasury stock repurchases

 

(0.3)

 

 

 

 

 

 

 

 

 

 

(18.5)

 

 

(18.5)

 

 

 

 

(18.5)

Restricted stock issued and related tax withholdings

 

0.3 

 

 

 

 

7.5 

 

 

(0.2)

 

 

 

 

3.9 

 

 

11.2 

 

 

 

 

11.2 

Share based compensation

 

 

 

 

 

3.2 

 

 

 

 

 

 

 

 

3.2 

 

 

 

 

3.2 

Dividends declared

 

 

 

 

 

 

 

(22.5)

 

 

 

 

 

 

(22.5)

 

 

 

 

(22.5)

Cumulative adjustment for adoption of new accounting standards (Note 2)

 

 

 

 

 

 

 

(33.8)

 

 

 

 

 

 

(33.8)

 

 

 

 

(33.8)

Balances as of December 30, 2018

 

53.4 

 

$

0.5 

 

$

2,007.4 

 

$

(349.1)

 

$

(246.8)

 

$

(14.6)

 

$

1,397.4 

 

$

8.5 

 

$

1,405.9 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

Additional

 

 

 

Other

 

 

 

Total

 

Non-

 

 

Three month period ended December 31, 2017

 

Common Stock

 

Paid-in

 

Accumulated

 

Comprehensive

 

Treasury

 

Shareholders'

 

controlling

 

Total

(in millions)

 

Shares

 

Amount

 

Capital

 

Deficit

 

Loss

 

Stock

 

Equity

 

Interest

 

Equity

Balances as of September 30, 2017

 

200.6 

 

 

2.0 

 

 

1,372.9 

 

 

(925.9)

 

 

309.0 

 

 

 

 

758.0 

 

 

1,188.9 

 

 

1,946.9 

Net income from continuing operations

 

 

 

 

 

 

 

40.0 

 

 

 

 

 

 

40.0 

 

 

57.2 

 

 

97.2 

Income from discontinued operations, net of tax

 

 

 

 

 

 

 

467.4 

 

 

 

 

 

 

467.4 

 

 

14.2 

 

 

481.6 

Other comprehensive income, net of tax

 

 

 

 

 

 

 

 

 

9.5 

 

 

 

 

9.5 

 

 

2.5 

 

 

12.0 

Sale and deconsolidation of HRG - Insurance Operations

 

 

 

 

 

 

 

 

 

(445.9)

 

 

 

 

(445.9)

 

 

(446.4)

 

 

(892.3)

Purchase of subsidiary stock

 

 

 

 

 

(10.3)

 

 

 

 

0.6 

 

 

 

 

(9.7)

 

 

1.7 

 

 

(8.0)

Excess of stock options and warrants

 

0.1 

 

 

 

 

1.4 

 

 

 

 

 

 

 

 

1.4 

 

 

 

 

1.4 

Restricted stock issued and related tax withholdings

 

 

 

 

 

(3.6)

 

 

 

 

 

 

 

 

(3.6)

 

 

(2.2)

 

 

(5.8)

Share based compensation

 

 

 

 

 

3.3 

 

 

 

 

 

 

 

 

3.3 

 

 

2.0 

 

 

5.3 

Dividend paid by subsidiary to noncontrolling interest

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(10.7)

 

 

(10.7)

Balances as of December 31, 2017

 

200.7 

 

$

2.0 

 

$

1,363.7 

 

$

(418.5)

 

$

(126.8)

 

$

 

$

820.4 

 

$

807.2 

 

$

1,627.6 


See accompanying notes to the condensed consolidated financial statements

5

 


 

SPECTRUM BRANDS HOLDINGS, INC. 

Condensed Consolidated Statements of Cash Flows

For the three month periods ended December 30, 2018 and December 31, 2017 

(unaudited)





 

 

 

 

 

 



 

 

 

 

 

 



 

Three Month Period Ended

(in millions)

 

December 30, 2018

 

December 31, 2017

Cash flows from operating activities

 

 

 

 

 

 

Net (loss) income

 

$

(112.3)

 

$

578.8 

(Loss) income from discontinued operations, net of tax

 

 

(82.8)

 

 

481.6 

Net (Loss) income from continuing operations

 

 

(29.5)

 

 

97.2 

Adjustments to reconcile net income to net cash from operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

66.0 

 

 

38.5 

Share based compensation

 

 

6.0 

 

 

4.5 

Purchase accounting inventory adjustment

 

 

 

 

0.8 

Pet safety recall inventory write-off

 

 

 

 

1.6 

Amortization of debt issuance costs and debt discount

 

 

4.7 

 

 

4.3 

Dividend from subsidiaries classified as discontinued operations

 

 

 

 

3.1 

Deferred tax benefit

 

 

(26.5)

 

 

(128.7)

Net changes in operating assets and liabilities

 

 

(304.7)

 

 

(202.8)

Net cash used by operating activities from continuing operations

 

 

(284.0)

 

 

(181.5)

Net cash (used) provided by operating activities from discontinued operations

 

 

(27.9)

 

 

120.7 

Net cash used by operating activities

 

 

(311.9)

 

 

(60.8)

Cash flows from investing activities

 

 

 

 

 

 

Purchases of property, plant and equipment

 

 

(13.5)

 

 

(20.3)

Proceeds from sales of property, plant and equipment

 

 

0.1 

 

 

0.9 

Proceeds from sale of HRG Insurance Operations

 

 

 

 

1,490.2 

Net cash (used) provided by investing activities from continuing operations

 

 

(13.4)

 

 

1,470.8 

Net cash used by investing activities from discontinued operations

 

 

(5.1)

 

 

(179.6)

Net cash (used) provided by investing activities

 

 

(18.5)

 

 

1,291.2 

Cash flows from financing activities

 

 

 

 

 

 

Proceeds from issuance of debt

 

 

124.3 

 

 

231.4 

Payment of debt

 

 

(45.6)

 

 

(123.4)

Payment of debt issuance costs

 

 

 

 

(0.1)

Treasury stock purchases

 

 

(18.5)

 

 

Purchases of subsidiary stock, net

 

 

 

 

(8.2)

Dividends paid to shareholders

 

 

(22.4)

 

 

Dividends paid by subsidiary to non-controlling interest

 

 

 

 

(9.8)

Share based award tax withholding payments, net of proceeds upon vesting

 

 

(2.2)

 

 

(22.2)

Other financing activities, net

 

 

 

 

1.4 

Net cash provided by financing activities from continuing operations

 

 

35.6 

 

 

69.1 

Net cash (used) provided by financing activities from discontinued operations

 

 

(2.3)

 

 

116.5 

Net cash provided by financing activities

 

 

33.3 

 

 

185.6 

Effect of exchange rate changes on cash, restricted cash and cash equivalents

 

 

(2.9)

 

 

(0.2)

Net change in cash, cash equivalents and restricted cash

 

 

(300.0)

 

 

1,415.8 

Net change in cash, cash equivalents and restricted cash in discontinued operations

 

 

 

 

38.3 

Net change in cash, cash equivalents and restricted cash in continuing operations

 

 

(300.0)

 

 

1,377.5 

Cash, cash equivalents and restricted cash, beginning of period

 

 

561.3 

 

 

285.4 

Cash, cash equivalents and restricted cash, end of period

 

$

261.3 

 

$

1,662.9 

Supplemental disclosure of cash flow information

 

 

 

 

 

 

Cash paid for interest

 

$

56.0 

 

$

60.1 

Cash paid for taxes

 

$

21.8 

 

$

10.0 

Non cash investing activities

 

 

 

 

 

 

Acquisition of property, plant and equipment through capital leases

 

$

1.4 

 

$

2.4 



See accompanying notes to the condensed consolidated financial statements

6

 


 

SB/RH HOLDINGS, LLC

Condensed Consolidated Statements of Financial Position

As of December 30, 2018 and September 30, 2018

(unaudited)



 

 

 

 

 

 



 

 

 

 

 

 

(in millions)

 

December 30, 2018

 

September 30, 2018

Assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

200.6 

 

$

505.4 

Trade receivables, net

 

 

413.9 

 

 

316.9 

Other receivables

 

 

128.9 

 

 

95.3 

Inventories

 

 

723.2 

 

 

583.6 

Prepaid expenses and other current assets

 

 

62.4 

 

 

62.9 

Current assets of business held for sale

 

 

2,283.4 

 

 

2,406.3 

Total current assets

 

 

3,812.4 

 

 

3,970.4 

Property, plant and equipment, net

 

 

477.7 

 

 

499.1 

Deferred charges and other

 

 

44.9 

 

 

74.1 

Goodwill

 

 

1,447.4 

 

 

1,454.7 

Intangible assets, net

 

 

1,603.1 

 

 

1,641.8 

Total assets

 

$

7,385.5 

 

$

7,640.1 

Liabilities and Shareholder's Equity

 

 

 

 

 

 

Current portion of long-term debt

 

$

1,768.2 

 

$

546.9 

Accounts payable

 

 

471.4 

 

 

585.0 

Accrued wages and salaries

 

 

48.1 

 

 

55.5 

Accrued interest

 

 

50.7 

 

 

55.0 

Other current liabilities

 

 

201.1 

 

 

151.7 

Current liabilities of business held for sale

 

 

463.2 

 

 

539.1 

Total current liabilities

 

 

3,002.7 

 

 

1,933.2 

Long-term debt, net of current portion

 

 

2,539.3 

 

 

3,686.4 

Deferred income taxes

 

 

275.5 

 

 

288.4 

Other long-term liabilities

 

 

119.7 

 

 

120.4 

Total liabilities

 

 

5,937.2 

 

 

6,028.4 

Commitments and contingencies (Note 18)

 

 

 

 

 

 

Shareholder's equity

 

 

 

 

 

 

Other capital

 

 

2,087.1 

 

 

2,073.0 

Accumulated deficit

 

 

(402.1)

 

 

(235.5)

Accumulated other comprehensive loss, net of tax

 

 

(246.8)

 

 

(235.7)

Total shareholder's equity

 

 

1,438.2 

 

 

1,601.8 

Noncontrolling interest

 

 

10.1 

 

 

9.9 

Total equity

 

 

1,448.3 

 

 

1,611.7 

Total liabilities and equity

 

$

7,385.5 

 

$

7,640.1 



See accompanying notes to the condensed consolidated financial statements

7

 


 

SB/RH HOLDINGS, LLC

Condensed Consolidated Statements of Income

For the three month periods ended December 30, 2018 and December 31, 2017

(unaudited)



 

 

 

 

 

 



 

 

 

 

 

 



 

Three Month Periods Ended

(in millions)

 

December 30, 2018

 

December 31, 2017

Revenue

 

$

874.6 

 

$

919.6 

Cost of goods sold

 

 

568.4 

 

 

600.9 

Restructuring and related charges

 

 

0.9 

 

 

0.3 

Gross profit

 

 

305.3 

 

 

318.4 

Selling

 

 

155.6 

 

 

153.8 

General and administrative

 

 

102.6 

 

 

69.0 

Research and development

 

 

11.1 

 

 

11.5 

Acquisition and integration related charges

 

 

1.6 

 

 

5.3 

Restructuring and related charges

 

 

8.2 

 

 

16.8 

Total operating expenses

 

 

279.1 

 

 

256.4 

Operating income

 

 

26.2 

 

 

62.0 

Interest expense

 

 

43.2 

 

 

38.5 

Other non-operating expense, net

 

 

0.8 

 

 

1.5 

(Loss) income from continuing operations before income taxes

 

 

(17.8)

 

 

22.0 

Income tax expense (benefit)

 

 

1.6 

 

 

(125.7)

Net (loss) income from continuing operations

 

 

(19.4)

 

 

147.7 

(Loss) income from discontinued operations, net of tax

 

 

(82.8)

 

 

21.7 

Net (loss) income

 

 

(102.2)

 

 

169.4 

Net income attributable to non-controlling interest

 

 

0.2 

 

 

0.9 

Net (loss) income attributable to controlling interest

 

$

(102.4)

 

$

168.5 

Amounts attributable to controlling interest

 

 

 

 

 

 

Net (loss) income from continuing operations attributable to controlling interest

 

$

(19.6)

 

$

146.8 

Net (loss) income from discontinued operations attributable to controlling interest

 

 

(82.8)

 

 

21.7 

Net (loss) income attributable to controlling interest

 

$

(102.4)

 

$

168.5 



See accompanying notes to the condensed consolidated financial statements



8

 


 



SB/RH HOLDINGS, LLC

Condensed Consolidated Statements of Comprehensive Income

For the three month periods ended December 30, 2018 and December 31, 2017

(unaudited)





 

 

 

 

 

 



 

Three Month Periods Ended

(in millions)

 

December 30, 2018

 

December 31, 2017

Net (loss) income

 

$

(102.2)

 

$

169.4 

Other comprehensive (loss) income

 

 

 

 

 

 

Foreign currency translation loss

 

 

(18.7)

 

 

(9.3)

   Deferred tax effect

 

 

(2.1)

 

 

7.2 

   Deferred tax valuation allowance

 

 

 

 

0.1 

   Net unrealized loss on foreign currency translation

 

 

(20.8)

 

 

(2.0)

Unrealized gain on derivative instruments

 

 

 

 

 

 

Unrealized gain (loss) on hedging activity before reclassification

 

 

14.4 

 

 

(0.8)

Net reclassification for (gain) loss to income from continuing operations

 

 

(2.9)

 

 

2.9 

Net reclassification for gain to income from discontinued operations

 

 

(0.1)

 

 

(0.3)

   Unrealized gain on hedging instruments after reclassification

 

 

11.4 

 

 

1.8 

   Deferred tax effect

 

 

(3.1)

 

 

   Net unrealized gain on hedging derivative instruments

 

 

8.3 

 

 

1.8 

Defined benefit pension gain

 

 

 

 

 

 

Defined benefit pension gain (loss) before reclassification

 

 

1.1 

 

 

(0.7)

Net reclassification for loss to income from continuing operations

 

 

0.5 

 

 

0.6 

Net reclassification for loss to income from discontinued operations

 

 

0.2 

 

 

0.2 

   Defined benefit pension gain after reclassification

 

 

1.8 

 

 

0.1 

   Deferred tax effect

 

 

(0.4)

 

 

   Net defined benefit pension gain

 

 

1.4 

 

 

0.1 

Net change to derive comprehensive loss for the period

 

 

(11.1)

 

 

(0.1)

Comprehensive (loss) income

 

 

(113.3)

 

 

169.3 

Comprehensive income attributable to non-controlling interest

 

 

 

 

0.2 

Comprehensive (loss) income attributable to controlling interest

 

$

(113.3)

 

$

169.1 



See accompanying notes to the condensed consolidated financial statements





9

 


 

SB/RH HOLDINGS, LLC

Condensed Consolidated Statements of Shareholder’s Equity

For the three month periods ended December 30, 2018 and December 31, 2017

(unaudited)







 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

Other

 

Total

 

Non-

 

 

 



 

Other

 

Accumulated

 

Comprehensive

 

Shareholder's

 

controlling

 

 

Three month period ended December 30, 2018 (in millions)

 

Capital

 

Deficit

 

Loss

 

Equity

 

Interest

 

Total Equity

Balances as of September 30, 2018

 

 

2,073.0 

 

 

(235.5)

 

 

(235.7)

 

 

1,601.8 

 

 

9.9 

 

 

1,611.7 

Net loss from continuing operations

 

 

 

 

(19.6)

 

 

 

 

(19.6)

 

 

0.2 

 

 

(19.4)

Loss from discontinued operations, net of tax

 

 

 

 

(82.8)

 

 

 

 

(82.8)

 

 

 

 

(82.8)

Other comprehensive loss, net of tax

 

 

 

 

 

 

(11.1)

 

 

(11.1)

 

 

 

 

(11.1)

Restricted stock issued and related tax withholdings

 

 

11.3 

 

 

 

 

 

 

11.3