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Press Release: Spectrum Brands Holdings Reports -4-

· 02/05/2021 06:30
Three Month Periods Ended --------------------------------------------- January 3, 2021 December 29, 2019 ---------------------- --------------------- Diluted EPS from continuing operations, as reported $ 1.68 $ (0.81) Adjustments: Restructuring and related charges 0.21 0.57 Transaction related charges 0.48 0.09 Debt refinancing costs -- 0.05 Gain on Energizer investment (0.14) (0.81) Loss on assets held for sale -- 0.69 Write-off from impairment of intangible assets -- 0.51 Inventory acquisition step-up 0.02 -- Other 0.14 (0.04) Income tax adjustment (0.26) (0.05) ------------------ ----------------- Total adjustments 0.45 1.01 ------------------ ----------------- Diluted EPS from continuing operations, as adjusted $ 2.13 $ 0.20 ==== ============ === ============-- Restructuring and related charges, which consist of project costs associated with the restructuring initiatives across the Company's segments; -- Transaction related charges that consist of (1) transaction costs from qualifying acquisition transactions during the period, or subsequent integration related project costs directly associated with an acquired business; and (2) divestiture related transaction costs that are recognized in continuing operations and post-divestiture separation costs consisting of incremental costs to facilitate separation of shared operations, including development of transferred shared service operations, platforms and personnel transferred as part of the divestitures and exiting of transition service arrangements (TSAs) and reverse TSAs; -- Gains and losses attributable to the Company's investment in Energizer common stock; -- Non-cash purchase accounting inventory adjustments recognized in earnings from continuing operations subsequent to an acquisition (when applicable); -- Non-cash asset impairments or write-offs realized and recognized in earnings from continuing operations (when applicable); -- Incremental interest costs recognized for the extinguishment of the 6.625% Notes, including the cash payment of premium from early extinguishment and non-cash write-off of debt issuance costs during the three month period ended December 29 2019; -- Other adjustments primarily consisting of costs attributable to (1) proposed settlement on outstanding litigation matters at our H&G division attributable to significant and unusual non-recurring claims with no previous history or precedent, (2) legal and litigation costs associated with Salus during the three month period ended December 29, 2019 as they are not considered a component of the continuing commercial products company; (3) foreign currency attributable to multicurrency loans for the three month period ended December 29, 2019, that were entered into with foreign subsidiaries in exchange for receipt of divestiture proceeds by the parent company and the distribution of the respective foreign subsidiaries' net assets as part of the GBL and GAC divestitures during the year ended September 30, 2019; (4) expenses and cost recovery for flood damage at Company facilities in Middleton, Wisconsin during the three month period ended December 29, 2019; and (5) incremental costs for separation of a key executive during the three month period ended December 29, 2019.debt 0.1 103.0 Payment of debt issuance costs -- (0.8) Treasury stock purchases (42.3) (90.6) Accelerated share repurchase -- (125.0) Dividends paid to shareholders (17.8) (19.9) Dividends paid by subsidiary to non-controlling interest (1.0) -- Share based award tax withholding payments, net of proceeds upon vesting (7.1) (12.2) Other financing activities, net 0.3 -- ----------------- ----------------- Net cash used by financing activities (121.8) (273.0) Effect of exchange rate changes on cash and cash equivalents 5.8 3.5 ----------------- ----------------- Net change in cash, cash equivalents and restricted cash in continuing operations (307.1) (484.9) Cash, cash equivalents, and restricted cash, beginning of period 533.7 627.1 ----------------- ----------------- Cash, cash equivalents, and restricted cash, end of period $ 226.6 $ 142.2 ==== =========== === ============ SPECTRUM BRANDS HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) (in millions) January 3, 2021 September 30, 2020 ---------------------------- ----------------- ---------------------- Assets Cash and cash equivalents $ 224.5 $ 531.6 Trade receivables, net 576.7 501.1 Other receivables 85.4 74.2 Inventories 696.9 557.7 Prepaid expenses and other current assets 73.8 63.5 ----------------- -------------------- Total current assets 1,657.3 1,728.1 Property, plant and equipment, net 395.8 396.5 Operating lease assets 108.6 103.8 Investments 12.5 66.9 Deferred charges and other 47.0 48.3 Goodwill 1,432.9 1,332.0 Intangible assets, net 1,516.7 1,431.7 ----------------- -------------------- Total assets $ 5,170.8 $ 5,107.3 ============= ================ Liabilities and Shareholders' Equity Current portion of long-term debt $ 15.3 $ 15.3 Accounts payable 558.0 557.5 Accrued wages and salaries 59.4 95.0 Accrued interest 45.7 38.5 Other current liabilities 256.2 238.6 ----------------- -------------------- Total current liabilities 934.6 944.9 Long-term debt, net of current portion 2,481.9 2,461.0 Long-term operating lease liabilities 90.8 88.8 Deferred income taxes 84.5 65.4 Other long-term liabilities 134.8 131.4 ----------------- -------------------- Total liabilities 3,726.6 3,691.5 Shareholders' equity 1,435.7 1,407.5 Non-controlling interest 8.5 8.3 ----------------- -------------------- Total equity 1,444.2 1,415.8 ----------------- -------------------- Total liabilities and equity $ 5,170.8 $ 5,107.3 ============= ================

ADJUSTED DILUTED EPS

We define adjusted diluted 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:

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 month periods ended January 3, 2021 and December 29, 2019 based upon enacted corporate tax rate in the United States.

The following is a reconciliation of reported diluted EPS from continuing operations to adjusted diluted EPS from continuing operations for the three month periods ended January 3, 2021 and December 29, 2019.

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February 05, 2021 06:30 ET (11:30 GMT)