2 unchanged sentences
Condensed Consolidated Statements of Financial Position
−Removed: As of July 3, 2022, and September 30, 2021
+Added: As of January 1, 2023 and September 30, 2022
(in millions)
−Removed: July 3, 2022 September 30, 2021
+Added: January 1, 2023 September 30, 2022
Cash and cash equivalents $ 228.0 $ 243.7
38 unchanged sentences
Condensed Consolidated Statements of Income
−Removed: For the three and nine month periods ended July 3, 2022 and July 4, 2021
−Removed: Three Month Periods Ended Nine Month Periods Ended
+Added: For the three month periods ended January 1, 2023 and January 2, 2022
+Added: Three Month Periods Ended
(in millions, except per share)
−Removed: July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: January 1, 2023 January 2, 2022
Net sales $ 713.3 $ 757.2
4 unchanged sentences
Research and development 6.2 7.6
−Removed: Gain from contingent consideration liability ( 25.0 ) — ( 25.0 ) —
Total operating expenses 222.1 243.1
−Removed: Operating income 38.7 29.9 6.7 101.1
+Added: Operating loss ( 20.2 ) ( 23.8 )
Interest expense 33.4 21.8
−Removed: Other non-operating expense (income), net 7.7 1.4 7.4 ( 9.8 )
−Removed: Income (loss) from continuing operations before income taxes 5.0 8.1 ( 73.1 ) 14.5
−Removed: Income tax expense (benefit) 2.0 10.0 ( 20.8 ) 5.3
−Removed: Net income (loss) from continuing operations 3.0 ( 1.9 ) ( 52.3 ) 9.2
+Added: Other non-operating (income) expense, net ( 1.5 ) 0.6
+Added: Loss from continuing operations before income taxes ( 52.1 ) ( 46.2 )
+Added: Income tax benefit ( 12.1 ) ( 16.0 )
+Added: Net loss from continuing operations ( 40.0 ) ( 30.2 )
Income from discontinued operations, net of tax 19.5 38.8
−Removed: Net income 32.9 30.7 57.5 139.3
+Added: Net (loss) income ( 20.5 ) 8.6
Net income from continuing operations attributable to non-controlling interest 0.3 —
−Removed: Net income (loss) from discontinued operations attributable to non-controlling interest 0.2 — 0.7 ( 0.2 )
−Removed: Net income attributable to controlling interest $ 32.7 $ 30.7 $ 56.8 $ 139.4
+Added: Net income from discontinued operations attributable to non-controlling interest 0.1 0.4
+Added: Net (loss) income attributable to controlling interest $ ( 20.9 ) $ 8.2
Amounts attributable to controlling interest
−Removed: Net income (loss) from continuing operations attributable to controlling interest $ 3.0 $ ( 1.9 ) $ ( 52.3 ) $ 9.1
+Added: Net loss from continuing operations attributable to controlling interest $ ( 40.3 ) $ ( 30.2 )
Net income from discontinued operations attributable to controlling interest 19.4 38.4
−Removed: Net income attributable to controlling interest $ 32.7 $ 30.7 $ 56.8 $ 139.4
+Added: Net (loss) income attributable to controlling interest $ ( 20.9 ) $ 8.2
Earnings Per Share
12 unchanged sentences
Condensed Consolidated Statements of Comprehensive Income
−Removed: For the three and nine month periods ended July 3, 2022 and July 4, 2021
+Added: For the three month periods ended January 1, 2023 and January 2, 2022
Three Month Periods Ended
−Removed: Nine Month Periods Ended
(in millions)
−Removed: July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
−Removed: Net income $ 32.9 $ 30.7 $ 57.5 $ 139.3
−Removed: Other comprehensive income
+Added: January 1, 2023 January 2, 2022
+Added: Net (loss) income $ ( 20.5 ) $ 8.6
+Added: Other comprehensive (loss) income
Foreign currency translation adjustment
−Removed: Foreign currency translation (loss) gain ( 51.5 ) 4.4 ( 68.8 ) 47.4
−Removed: Unrealized gain (loss) from net investment hedge 24.8 ( 3.4 ) 47.3 ( 4.8 )
+Added: Foreign currency translation gain (loss) 60.5 ( 3.8 )
+Added: Unrealized (loss) gain from net investment hedge ( 33.9 ) 10.6
Foreign currency translation adjustment before tax 26.6 6.8
2 unchanged sentences
Unrealized (loss) gain on derivative instruments
−Removed: Unrealized gain (loss) on hedging activity before reclassification 4.3 ( 1.0 ) 11.8 ( 7.6 )
−Removed: Net reclassification for (gain) loss to income from continuing operations ( 4.9 ) 2.6 ( 8.5 ) 8.3
−Removed: Net reclassification for (gain) loss to income from discontinued operations ( 0.9 ) 0.2 ( 2.1 ) 0.2
−Removed: Unrealized (loss) gain on hedging instruments after reclassification ( 1.5 ) 1.8 1.2 0.9
+Added: Unrealized (loss) gain on hedging activity before reclassification ( 25.4 ) 1.2
+Added: Net reclassification for gain to income from continuing operations ( 2.5 ) ( 2.1 )
+Added: Net reclassification for gain to income from discontinued operations — ( 0.5 )
+Added: Unrealized loss on hedging instruments after reclassification ( 27.9 ) ( 1.4 )
Deferred tax effect 7.2 4.5
Net unrealized (loss) gain on hedging derivative instruments ( 20.7 ) 3.1
−Removed: Defined benefit pension gain
−Removed: Defined benefit pension gain (loss) before reclassification 2.3 ( 0.2 ) 4.1 ( 1.5 )
+Added: Defined benefit pension loss
+Added: Defined benefit pension (loss) gain before reclassification ( 2.3 ) 0.6
Net reclassification for loss to income from continuing operations 0.9 1.0
−Removed: Net reclassification for gain to income from discontinued operations ( 0.1 ) ( 0.1 ) ( 0.1 ) ( 0.1 )
−Removed: Defined benefit pension gain after reclassification 3.3 0.8 7.1 1.7
+Added: Defined benefit pension (loss) gain after reclassification ( 1.4 ) 1.6
Deferred tax effect 1.2 ( 2.9 )
−Removed: Net defined benefit pension gain 2.4 0.6 2.7 1.1
+Added: Net defined benefit pension loss ( 0.2 ) ( 1.3 )
Net change to derive comprehensive income for the period 14.5 4.1
−Removed: Comprehensive income 1.4 34.6 30.0 184.8
−Removed: Comprehensive loss from continuing operations attributable to non-controlling interest ( 0.1 ) — ( 0.2 ) —
−Removed: Comprehensive (loss) income from discontinuing operations attributable to non-controlling interest ( 0.3 ) 0.1 ( 0.2 ) 0.4
−Removed: Comprehensive income attributable to controlling interest $ 1.8 $ 34.5 $ 30.4 $ 184.4
+Added: Comprehensive (loss) income ( 6.0 ) 12.7
+Added: Comprehensive income from continuing operations attributable to non-controlling interest 0.2 —
+Added: Comprehensive income from discontinuing operations attributable to non-controlling interest 0.1 0.1
+Added: Comprehensive (loss) income attributable to controlling interest $ ( 6.3 ) $ 12.6
See accompanying notes to the condensed consolidated financial statements
1 unchanged sentence
Condensed Consolidated Statements of Shareholders' Equity
−Removed: For the nine month period ended July 3, 2022
+Added: For the three month period ended January 1, 2023
Common Stock Additional
7 unchanged sentences
Balances at September 30, 2022 40.8 $ 0.5 $ 2,032.5 $ 362.1 $ ( 303.1 ) $ ( 828.8 ) $ 1,263.2 $ 5.9 $ 1,269.1
−Removed: Net loss from continuing operations — — — ( 30.2 ) — — ( 30.2 ) — ( 30.2 )
+Added: Net (loss) income from continuing operations — — — ( 40.3 ) — — ( 40.3 ) 0.3 ( 40.0 )
Income from discontinued operations, net of tax — — — 19.4 — — 19.4 0.1 19.5
Other comprehensive income, net of tax — — — — 14.2 — 14.2 0.3 14.5
−Removed: Treasury stock repurchases ( 1.1 ) — — — — ( 110.0 ) ( 110.0 ) — ( 110.0 )
Restricted stock issued and related tax withholdings 0.2 — ( 25.1 ) — — 14.6 ( 10.5 ) — ( 10.5 )
1 unchanged sentence
Dividends declared — — — ( 17.3 ) — — ( 17.3 ) — ( 17.3 )
−Removed: Balances as of January 2, 2022 41.0 0.5 2,025.5 350.4 ( 231.3 ) ( 804.8 ) 1,340.3 7.6 1,347.9
−Removed: Net loss from continuing operations — — — ( 25.1 ) — — ( 25.1 ) — ( 25.1 )
−Removed: Income from discontinued operations, net of tax — — — 41.0 — — 41.0 0.1 41.1
−Removed: Other comprehensive loss, net of tax — — — — — — — ( 0.1 ) ( 0.1 )
−Removed: Treasury stock repurchases ( 0.2 ) — — — — ( 24.0 ) ( 24.0 ) — ( 24.0 )
−Removed: Restricted stock issued and related tax withholdings — — ( 0.1 ) — — — ( 0.1 ) — ( 0.1 )
−Removed: Share based compensation — — 7.8 — — — 7.8 — 7.8
−Removed: Dividends declared — — — ( 17.6 ) — — ( 17.6 ) — ( 17.6 )
−Removed: Distribution of equity by subsidiary to non-controlling interest — — — — — — — ( 1.3 ) ( 1.3 )
−Removed: Balances as of April 3, 2022 40.8 0.5 2,033.2 348.7 ( 231.3 ) ( 828.8 ) 1,322.3 6.3 1,328.6
−Removed: Net income from continuing operations — — — 3.0 — — 3.0 — 3.0
−Removed: Income from discontinued operations, net of tax — — — 29.7 — — 29.7 0.2 29.9
−Removed: Other comprehensive loss, net of tax — — — — ( 31.1 ) — ( 31.1 ) ( 0.4 ) ( 31.5 )
−Removed: Share based compensation — — ( 0.8 ) — — — ( 0.8 ) — ( 0.8 )
−Removed: Dividends declared — — — ( 17.0 ) — — ( 17.0 ) — ( 17.0 )
−Removed: Balances at July 3, 2022 40.8 $ 0.5 $ 2,032.4 $ 364.4 $ ( 262.4 ) $ ( 828.8 ) $ 1,306.1 $ 6.1 $ 1,312.2
−Removed: See accompanying notes to the condensed consolidated financial statements
+Added: Balances at January 1, 2023 41.0 $ 0.5 $ 2,011.5 $ 323.9 $ ( 288.9 ) $ ( 814.2 ) $ 1,232.8 $ 6.6 $ 1,239.4
SPECTRUM BRANDS HOLDINGS, INC
Condensed Consolidated Statements of Shareholders' Equity
−Removed: For the nine month period ended July 4, 2021
+Added: For the three month period ended January 2, 2022
Common Stock Additional
7 unchanged sentences
Balances at September 30, 2021 41.8 $ 0.5 $ 2,063.8 $ 359.9 $ ( 235.3 ) $ ( 717.0 ) $ 1,471.9 $ 7.1 $ 1,479.0
−Removed: Net income from continuing operations — — — 14.7 — — 14.7 1.0 15.7
−Removed: Income (loss) from discontinued operations, net of tax — — — 57.4 — — 57.4 ( 0.2 ) 57.2
−Removed: Other comprehensive income, net of tax — — — — 16.2 — 16.2 0.4 16.6
−Removed: Treasury stock repurchases ( 0.6 ) — — — — ( 42.3 ) ( 42.3 ) — ( 42.3 )
−Removed: Restricted stock issued and related tax withholdings 0.2 — ( 18.6 ) — — 11.7 ( 6.9 ) — ( 6.9 )
−Removed: Share based compensation — — 7.5 — — — 7.5 — 7.5
−Removed: Dividends declared — — — ( 18.4 ) — — ( 18.4 ) — ( 18.4 )
−Removed: Dividends paid by subsidiary to non-controlling interest — — — — — — — ( 1.0 ) ( 1.0 )
−Removed: Balances as of January 3, 2021 42.7 0.5 2,043.2 297.6 ( 268.5 ) ( 637.1 ) 1,435.7 8.5 1,444.2
−Removed: Net loss from continuing operations — — — ( 3.7 ) — — ( 3.7 ) ( 0.9 ) ( 4.6 )
−Removed: Income from discontinued operations, net of tax — — — 40.3 — — 40.3 — 40.3
−Removed: Other comprehensive income (loss), net of tax — — — — 25.1 — 25.1 ( 0.1 ) 25.0
−Removed: Restricted stock issued and related tax withholdings — — ( 0.1 ) — — 0.1 — — —
−Removed: Share based compensation — — 8.5 — — — 8.5 — 8.5
−Removed: Dividends declared — — — ( 18.5 ) — — ( 18.5 ) — ( 18.5 )
−Removed: Dividends paid by subsidiary to non-controlling interest — — — — — — — ( 0.3 ) ( 0.3 )
−Removed: Balances as of April 4, 2021 42.7 0.5 2,051.6 315.7 ( 243.4 ) ( 637.0 ) 1,487.4 7.2 1,494.6
−Removed: Net loss from continuing operations — — — ( 1.9 ) — — ( 1.9 ) — ( 1.9 )
+Added: Loss from continuing operations — — — ( 30.2 ) — — ( 30.2 ) — ( 30.2 )
Income from discontinued operations, net of tax — — — 38.4 — — 38.4 0.4 38.8
4 unchanged sentences
Dividends declared — — — ( 17.7 ) — — ( 17.7 ) — ( 17.7 )
−Removed: Balances at July 4, 2021 42.6 $ 0.5 $ 2,058.0 $ 328.1 $ ( 239.6 ) $ ( 646.1 ) $ 1,500.9 $ 7.3 $ 1,508.2
+Added: Balances as of January 2, 2022 41.0 $ 0.5 $ 2,025.5 $ 350.4 $ ( 231.3 ) $ ( 804.8 ) $ 1,340.3 $ 7.6 $ 1,347.9
See accompanying notes to the condensed consolidated financial statements
1 unchanged sentence
Condensed Consolidated Statements of Cash Flows
−Removed: For the nine month periods ended July 3, 2022 and July 4, 2021
−Removed: Nine Month Periods Ended
−Removed: (in millions) July 3, 2022 July 4, 2021
+Added: For the three month periods ended January 1, 2023 and January 2, 2022
+Added: Three Month Periods Ended
+Added: (in millions) January 1, 2023 January 2, 2022
Cash flows from operating activities
−Removed: Net income $ 57.5 $ 139.3
+Added: Net (loss) income $ ( 20.5 ) $ 8.6
Income from discontinued operations, net of tax 19.5 38.8
−Removed: Net (loss) income from continuing operations ( 52.3 ) 9.2
+Added: Net loss from continuing operations ( 40.0 ) ( 30.2 )
Adjustments to reconcile net (loss) income to net cash from operating activities:
2 unchanged sentences
Share based compensation 3.3 5.6
−Removed: Gain on equity investment — ( 6.9 )
Amortization of debt issuance costs and debt discount 2.0 1.4
−Removed: Write-off of unamortized discount and debt issuance costs — 7.9
−Removed: Gain from contingent consideration liability ( 25.0 ) —
+Added: Gain from remeasurement of contingent consideration liability ( 1.5 ) —
Non-cash purchase accounting adjustments 0.5 —
2 unchanged sentences
Net cash used by operating activities from continuing operations ( 57.0 ) ( 255.8 )
−Removed: Net cash provided by operating activities from discontinued operations 42.4 81.5
−Removed: Net cash (used) provided by operating activities ( 138.4 ) 8.9
+Added: Net cash used by operating activities from discontinued operations ( 7.2 ) ( 15.3 )
+Added: Net cash used by operating activities ( 64.2 ) ( 271.1 )
Cash flows from investing activities
1 unchanged sentence
Proceeds from disposal of property, plant and equipment — 0.1
−Removed: Business acquisitions, net of cash acquired ( 272.1 ) ( 429.5 )
−Removed: Proceeds from sale of equity investment — 73.1
−Removed: Other investing activity ( 0.1 ) ( 0.4 )
Net cash used by investing activities from continuing operations ( 10.0 ) ( 14.0 )
5 unchanged sentences
Payment of debt issuance costs ( 2.3 ) —
−Removed: Payment of contingent consideration ( 1.9 ) —
Treasury stock purchases — ( 110.0 )
1 unchanged sentence
Share based award tax withholding payments, net of proceeds upon vesting ( 10.5 ) ( 24.5 )
−Removed: Other financing activity — 0.3
−Removed: Net cash provided (used) by financing activities from continuing operations 545.7 ( 12.8 )
+Added: Net cash provided by financing activities from continuing operations 56.8 310.0
Net cash used by financing activities from discontinued operations ( 0.4 ) ( 0.4 )
−Removed: Net cash provided (used) by financing activities 543.0 ( 15.2 )
+Added: Net cash provided by financing activities 56.4 309.6
Effect of exchange rate changes on cash and cash equivalents 5.7 ( 2.5 )
14 unchanged sentences
Condensed Consolidated Statements of Financial Position
−Removed: As of July 3, 2022 and September 30, 2021
−Removed: (in millions) July 3, 2022 September 30, 2021
+Added: As of January 1, 2023 and September 30, 2022
+Added: (in millions) January 1, 2023 September 30, 2022
Cash and cash equivalents $ 226.7 $ 242.4
36 unchanged sentences
Condensed Consolidated Statements of Income
−Removed: For the three and nine month periods ended July 3, 2022 and July 4, 2021
−Removed: Three Month Periods Ended Nine Month Periods Ended
−Removed: (in millions) July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: For the three month periods ended January 1, 2023 and January 2, 2022
+Added: Three Month Periods Ended
+Added: (in millions) January 1, 2023 January 2, 2022
Net sales $ 713.3 $ 757.2
4 unchanged sentences
Research and development 6.2 7.6
−Removed: Gain from contingent consideration liability ( 25.0 ) — ( 25.0 ) —
Total operating expenses 222.0 242.8
−Removed: Operating income 39.5 31.5 8.6 103.9
+Added: Operating loss ( 20.1 ) ( 23.5 )
Interest expense 33.4 21.8
−Removed: Other non-operating expense (income), net 7.7 1.4 7.3 ( 9.8 )
−Removed: Income (loss) from continuing operations before income taxes 5.7 9.6 ( 71.4 ) 17.1
−Removed: Income tax expense (benefit) 2.0 10.6 ( 20.4 ) 6.1
−Removed: Net income (loss) from continuing operations 3.7 ( 1.0 ) ( 51.0 ) 11.0
+Added: Other non-operating (income) expense, net ( 1.5 ) 0.6
+Added: Loss from continuing operations before income taxes ( 52.0 ) ( 45.9 )
+Added: Income tax benefit ( 12.2 ) ( 15.8 )
+Added: Net loss from continuing operations ( 39.8 ) ( 30.1 )
Income from discontinued operations, net of tax 19.5 38.8
−Removed: Net income 33.5 31.7 58.7 141.3
+Added: Net (loss) income ( 20.3 ) 8.7
Net income from continuing operations attributable to non-controlling interest 0.3 —
−Removed: Net income (loss) from discontinued operations attributable to non-controlling interest 0.2 — 0.7 ( 0.2 )
−Removed: Net income attributable to controlling interest $ 33.3 $ 31.7 $ 58.0 $ 141.4
+Added: Net income from discontinued operations attributable to non-controlling interest 0.1 0.4
+Added: Net (loss) income attributable to controlling interest $ ( 20.7 ) $ 8.3
Amounts attributable to controlling interest
−Removed: Net income (loss) from continuing operations attributable to controlling interest $ 3.7 $ ( 1.0 ) $ ( 51.0 ) $ 10.9
+Added: Net loss from continuing operations attributable to controlling interest $ ( 40.1 ) $ ( 30.1 )
Net income from discontinued operations attributable to controlling interest 19.4 38.4
−Removed: Net income attributable to controlling interest $ 33.3 $ 31.7 $ 58.0 $ 141.4
+Added: Net (loss) income attributable to controlling interest $ ( 20.7 ) $ 8.3
See accompanying notes to the condensed consolidated financial statements
1 unchanged sentence
Condensed Consolidated Statements of Comprehensive Income
−Removed: For the three and nine month periods ended July 3, 2022 and July 4, 2021
+Added: For the three month periods ended January 1, 2023 and January 2, 2022
Three Month Periods Ended
−Removed: Nine Month Periods Ended
(in millions)
−Removed: July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
−Removed: Net income $ 33.5 $ 31.7 $ 58.7 $ 141.3
−Removed: Other comprehensive income
+Added: January 1, 2023 January 2, 2022
+Added: Net (loss) income $ ( 20.3 ) $ 8.7
+Added: Other comprehensive (loss) income
Foreign currency translation adjustment
−Removed: Foreign currency translation (loss) gain ( 51.5 ) 4.4 ( 68.8 ) 47.4
+Added: Foreign currency translation gain (loss) 60.5 ( 3.8 )
Unrealized gain (loss) from net investment hedge ( 33.9 ) 10.6
3 unchanged sentences
Unrealized (loss) gain on derivative instruments
−Removed: Unrealized gain (loss) on hedging activity before reclassification 4.3 ( 1.0 ) 11.8 ( 7.6 )
−Removed: Net reclassification for (gain) loss to income from continuing operations ( 4.9 ) 2.6 ( 8.5 ) 8.3
−Removed: Net reclassification for (gain) loss to income from discontinued operations ( 0.9 ) 0.2 ( 2.1 ) 0.2
−Removed: Unrealized (loss) gain on hedging instruments after reclassification ( 1.5 ) 1.8 1.2 0.9
+Added: Unrealized (loss) gain on hedging activity before reclassification ( 25.4 ) 1.2
+Added: Net reclassification for gain to income from continuing operations ( 2.5 ) ( 2.1 )
+Added: Net reclassification for gain to income from discontinued operations — ( 0.5 )
+Added: Unrealized loss on hedging instruments after reclassification ( 27.9 ) ( 1.4 )
Deferred tax effect 7.2 4.5
Net unrealized (loss) gain on hedging derivative instruments ( 20.7 ) 3.1
−Removed: Defined benefit pension gain
−Removed: Defined benefit pension gain (loss) before reclassification 2.3 ( 0.2 ) 4.1 ( 1.5 )
+Added: Defined benefit pension loss
+Added: Defined benefit pension (loss) gain before reclassification ( 2.3 ) 0.6
Net reclassification for loss to income from continuing operations 0.9 1.0
−Removed: Net reclassification for gain to income from discontinued operations ( 0.1 ) ( 0.1 ) ( 0.1 ) ( 0.1 )
−Removed: Defined benefit pension gain after reclassification 3.3 0.8 7.1 1.7
+Added: Defined benefit pension (loss) gain after reclassification ( 1.4 ) 1.6
Deferred tax effect 1.2 ( 2.9 )
−Removed: Net defined benefit pension gain 2.4 0.6 2.7 1.1
+Added: Net defined benefit pension loss ( 0.2 ) ( 1.3 )
Net change to derive comprehensive income for the period 14.5 4.1
−Removed: Comprehensive income 2.0 35.6 31.2 186.8
−Removed: Comprehensive loss from continuing operations attributable to non-controlling interest ( 0.1 ) — ( 0.2 ) —
−Removed: Comprehensive (loss) income from discontinuing operations attributable to non-controlling interest ( 0.3 ) 0.1 ( 0.2 ) 0.4
−Removed: Comprehensive income attributable to controlling interest $ 2.4 $ 35.5 $ 31.6 $ 186.4
+Added: Comprehensive (loss) income ( 5.8 ) 12.8
+Added: Comprehensive income from continuing operations attributable to non-controlling interest 0.2 —
+Added: Comprehensive income from discontinuing operations attributable to non-controlling interest 0.1 0.1
+Added: Comprehensive (loss) income attributable to controlling interest $ ( 6.1 ) $ 12.7
See accompanying notes to the condensed consolidated financial statements
1 unchanged sentence
Condensed Consolidated Statements of Shareholder's Equity
−Removed: For the nine month period ended July 3, 2022
+Added: For the three month period ended January 1, 2023
(in millions) Other
5 unchanged sentences
Balances at September 30, 2022 $ 2,164.6 $ ( 736.0 ) $ ( 303.0 ) $ 1,125.6 $ 7.5 $ 1,133.1
−Removed: Net loss from continuing operations — ( 30.1 ) — ( 30.1 ) — ( 30.1 )
+Added: Net (loss) income from continuing operations — ( 40.1 ) — ( 40.1 ) 0.3 ( 39.8 )
Income from discontinued operations, net of tax — 19.4 — 19.4 0.1 19.5
3 unchanged sentences
Dividends paid to parent — ( 17.1 ) — ( 17.1 ) — ( 17.1 )
−Removed: Balances as of January 2, 2022 2,158.7 ( 725.8 ) ( 231.2 ) 1,201.7 9.2 1,210.9
−Removed: Net loss from continuing operations — ( 24.6 ) — ( 24.6 ) — ( 24.6 )
−Removed: Income from discontinued operations, net of tax — 41.0 — 41.0 0.1 41.1
−Removed: Other comprehensive loss, net of tax — — — — ( 0.1 ) ( 0.1 )
−Removed: Share based compensation 7.4 — — 7.4 — 7.4
−Removed: Dividends paid to parent — ( 41.2 ) — ( 41.2 ) — ( 41.2 )
−Removed: Distribution of equity by subsidiary to non-controlling interest — — — — ( 1.3 ) ( 1.3 )
−Removed: Balances as of April 3, 2022 2,166.1 ( 750.6 ) ( 231.2 ) 1,184.3 7.9 1,192.2
−Removed: Net income from continuing operations — 3.7 — 3.7 — 3.7
−Removed: Income from discontinued operations, net of tax — 29.6 — 29.6 0.2 29.8
−Removed: Other comprehensive loss, net of tax — — ( 31.1 ) ( 31.1 ) ( 0.4 ) ( 31.5 )
−Removed: Share based compensation ( 1.2 ) — — ( 1.2 ) — ( 1.2 )
−Removed: Dividends paid to parent — ( 17.1 ) — ( 17.1 ) — ( 17.1 )
−Removed: Balances at July 3, 2022 $ 2,164.9 $ ( 734.4 ) $ ( 262.3 ) $ 1,168.2 $ 7.7 $ 1,175.9
−Removed: See accompanying notes to the condensed consolidated financial statements
+Added: Balances at January 1, 2023 $ 2,158.0 $ ( 773.8 ) $ ( 288.8 ) $ 1,095.4 $ 8.2 $ 1,103.6
SB/RH HOLDINGS, LLC
Condensed Consolidated Statements of Shareholder's Equity
−Removed: For the nine month period ended July 4, 2021
+Added: For the three month period ended January 2, 2022
(in millions) Other
5 unchanged sentences
Balances at September 30, 2021 $ 2,174.8 $ ( 614.9 ) $ ( 235.2 ) $ 1,324.7 $ 8.7 $ 1,333.4
−Removed: Net income from continuing operations — 15.1 — 15.1 1.0 16.1
−Removed: Income (loss) from discontinued operations, net of tax — 57.4 — 57.4 ( 0.2 ) 57.2
+Added: Loss from continuing operations — ( 30.1 ) — ( 30.1 ) — ( 30.1 )
+Added: Income from discontinued operations, net of tax — 38.4 — 38.4 0.4 38.8
Other comprehensive income, net of tax — — 4.0 4.0 0.1 4.1
2 unchanged sentences
Dividends paid to parent — ( 119.2 ) — ( 119.2 ) — ( 119.2 )
−Removed: Dividends paid by subsidiary to non-controlling interest — — — — ( 1.0 ) ( 1.0 )
Balances as of January 2, 2022 $ 2,158.7 $ ( 725.8 ) $ ( 231.2 ) $ 1,201.7 $ 9.2 $ 1,210.9
−Removed: Net loss from continuing operations — ( 3.3 ) — ( 3.3 ) ( 0.9 ) ( 4.2 )
−Removed: Income from discontinued operations, net of tax — 40.4 — 40.4 — 40.4
−Removed: Other comprehensive income (loss), net of tax — — 25.1 25.1 ( 0.1 ) 25.0
−Removed: Share based compensation 8.0 — — 8.0 — 8.0
−Removed: Dividends paid to parent — ( 16.1 ) — ( 16.1 ) — ( 16.1 )
−Removed: Dividends paid by subsidiary to non-controlling interest — — — — ( 0.3 ) ( 0.3 )
−Removed: Balances as of April 4, 2021 2,162.5 ( 580.8 ) ( 243.3 ) 1,338.4 8.8 1,347.2
−Removed: Net loss from continuing operations — ( 1.0 ) — ( 1.0 ) — ( 1.0 )
−Removed: Income from discontinued operations, net of tax — 32.7 — 32.7 — 32.7
−Removed: Other comprehensive income, net of tax — — 3.8 3.8 0.1 3.9
−Removed: Share based compensation 6.9 — — 6.9 — 6.9
−Removed: Dividends paid to parent — ( 28.1 ) — ( 28.1 ) — ( 28.1 )
−Removed: Balances at July 4, 2021 $ 2,169.4 $ ( 577.2 ) $ ( 239.5 ) $ 1,352.7 $ 8.9 $ 1,361.6
See accompanying notes to the condensed consolidated financial statements
1 unchanged sentence
Condensed Consolidated Statements of Cash Flows
−Removed: For the nine month periods ended July 3, 2022 and July 4, 2021
−Removed: Nine Month Periods Ended
−Removed: (in millions) July 3, 2022 July 4, 2021
+Added: For the three month periods ended January 1, 2023 and January 2, 2022
+Added: Three Month Periods Ended
+Added: (in millions) January 1, 2023 January 2, 2022
Cash flows from operating activities
−Removed: Net income $ 58.7 $ 141.3
+Added: Net (loss) income $ ( 20.3 ) $ 8.7
Income from discontinued operations, net of tax 19.5 38.8
−Removed: Net (loss) income from continuing operations ( 51.0 ) 11.0
+Added: Net loss from continuing operations ( 39.8 ) ( 30.1 )
Adjustments to reconcile net (loss) income to net cash from operating activities:
2 unchanged sentences
Share based compensation 3.1 5.6
−Removed: Gain on equity investment — ( 6.9 )
Amortization of debt issuance costs and debt discount 2.0 1.4
Gain from contingent consideration liability ( 1.5 ) —
−Removed: Write-off of unamortized discount and debt issuance costs — 7.9
Non-cash purchase accounting adjustments 0.5 —
2 unchanged sentences
Net cash used by operating activities from continuing operations ( 67.6 ) ( 288.3 )
−Removed: Net cash provided by operating activities from discontinued operations 42.3 81.7
−Removed: Net cash (used) provided by operating activities ( 170.8 ) 2.5
+Added: Net cash used by operating activities from discontinued operations ( 7.1 ) ( 15.3 )
+Added: Net cash used by operating activities ( 74.7 ) ( 303.6 )
Cash flows from investing activities
1 unchanged sentence
Proceeds from disposal of property, plant and equipment — 0.1
−Removed: Business acquisitions, net of cash acquired ( 272.1 ) ( 429.5 )
−Removed: Proceeds from sale of equity investment — 73.1
−Removed: Other investing activities ( 0.1 ) ( 0.4 )
Net cash used by investing activities from continuing operations ( 10.0 ) ( 14.0 )
5 unchanged sentences
Payment of debt issuance costs ( 2.3 ) —
−Removed: Payment of contingent consideration ( 1.9 ) —
Payment of cash dividends to parent ( 17.1 ) ( 119.2 )
−Removed: Net cash provided (used) by financing activities from continuing operations 578.2 ( 4.1 )
+Added: Net cash provided by financing activities from continuing operations 67.3 342.6
Net cash used by financing activities from discontinued operations ( 0.4 ) ( 0.4 )
−Removed: Net cash provided (used) by financing activities 575.5 ( 6.5 )
+Added: Net cash provided by financing activities 66.9 342.2
Effect of exchange rate changes on cash and cash equivalents 5.7 ( 2.5 )
25 unchanged sentences
The exceptions are the first quarter, which begins on October 1, and the fourth quarter, which ends on September 30.
−Removed: As a result, the fiscal period end date for the three and nine month periods included within this Quarterly Report for the Company are July 3, 2022 and July 4, 2021.
+Added: As a result, the fiscal period end date for the three month periods included within this Quarterly Report for the Company are January 1, 2023 and January 2, 2022.
Newly Adopted Accounting Standards
−Removed: In December 2019, the FASB issued ASU No.
−Removed: 2019-12, Income Taxes (Topic 740):
−Removed: Simplifying the Accounting for Income Taxes .
−Removed: The new standard simplifies the accounting for income taxes by removing certain exceptions for recognizing deferred taxes for investments, performing intra-period allocation and calculating income taxes in interim periods.
−Removed: The new standard also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group.
−Removed: The ASU is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years and was adopted by the Company on October 1, 2021.
−Removed: The adoption did not have a material impact on the Company's condensed consolidated financial statements.
−Removed: Recently Issued Accounting Standards
In March 2020, the FASB issued ASU 2020- 04, Reference Rate Reform (Topic 848):
4 unchanged sentences
In January 2021, the FASB issued ASU 2021-01, which adds implementation guidance to clarify certain optional expedients in Topic 848.
−Removed: The ASU can be adopted no later than December 31, 2022 with early adoption permitted.
−Removed: We do not anticipate the adoption will have a material impact on the Company consolidated financial statements.
+Added: The adoption did not have a material impact on the consolidated financial statements.
+Added: Recently Issued Accounting Standards
+Added: In September 2022, the FASB issued ASU 2022-04, Supplier Finance Programs (Subtopic 405-50):
+Added: Disclosure of Supplier Finance Program Obligations to enhance transparency about the use of supplier finance programs.
+Added: Under the ASU, the buyer in a supplier finance program is required to disclose information about the key terms of the program, outstanding confirmed amounts as of the end of the period, a rollforward of such amounts during each annual period, and a description of where in the financial statements outstanding amounts are presented.
+Added: The amendments in ASU 2022-04 are effective for all entities for fiscal years beginning after December 15, 2022, including interim periods within those financial years, except for the disclosure of rollforward information, which is effective for fiscal years beginning after December 15, 2023.
+Added: Early adoption is permitted.
+Added: The Company is evaluating the effect of adopting this new accounting guidance.
NOTE 2 – DIVESTITURES
−Removed: The following table summarizes the components of Income from Discontinued Operations, Net of Tax in the accompanying Condensed Consolidated Statements of Income for the three and nine month periods ended July 3, 2022 and July 4, 2021:
−Removed: Three Month Periods Ended Nine Month Periods Ended
−Removed: (in millions) July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: The following table summarizes the components of Income from Discontinued Operations, Net of Tax in the accompanying Condensed Consolidated Statements of Income for the three month periods ended January 1, 2023 and January 2, 2022:
+Added: Three Month Periods Ended
+Added: (in millions) January 1, 2023 January 2, 2022
Income from discontinued operations before income taxes – HHI $ 45.0 $ 60.0
4 unchanged sentences
Income from discontinued operations, net of tax 19.5 38.8
−Removed: Income (loss) from discontinued operations, net of tax attributable to noncontrolling interest 0.2 — 0.7 ( 0.2 )
+Added: Income from discontinued operations, net of tax attributable to noncontrolling interest 0.1 0.4
Income from discontinued operations, net of tax attributable to controlling interest $ 19.4 $ 38.4
−Removed: Interest from corporate debt allocated to discontinued operations includes interest expense from Term Loans required to be paid down using proceeds received on disposal on sale of a business, and interest expense from corporate debt not directly attributable to or related to other operations based on the ratio of net assets of the disposal group held for sale to the consolidated net assets of the Company plus consolidated debt, excluding debt assumed in transaction, required to be repaid, or directly attributable to other operations of the Company.
+Added: Interest from corporate debt allocated to discontinued operations includes interest expense from Term Loans required to be paid down using proceeds received on disposal on sale of a business, and interest expense from corporate debt not directly attributable to or related to other operations based on the ratio of net assets of the disposal group held for sale to the consolidated net assets of the Company plus consolidated debt, excluding debt assumed in the transaction, required to be repaid, or directly attributable to other operations of the Company.
Corporate debt, including Term Loans required to be paid down, are not classified as held for sale as they are not directly attributable to the identified disposal group.
+Added: Hardware and Home Improvement ("HHI")
+Added: On September 8, 2021, the Company entered into a definitive Asset and Stock Purchase Agreement (the "ASPA") with ASSA ABLOY AB ("ASSA") to sell its HHI segment for cash proceeds of $ 4.3 billion, subject to customary purchase price adjustments (the "HHI Transaction").
+Added: The Company's assets and liabilities associated with the HHI disposal group have been classified as held for sale, and the respective operations have been classified as discontinued operations and reported separately for all periods presented.
SPECTRUM BRANDS HOLDINGS, INC.
3 unchanged sentences
NOTE 2 – DIVESTITURES (continued)
−Removed: Hardware and Home Improvement ("HHI")
−Removed: On September 8, 2021, the Company entered into a definitive Asset and Stock Purchase Agreement (the "ASPA") with ASSA ABLOY AB ("ASSA") to sell its HHI segment for cash proceeds of $ 4.3 billion, subject to customary purchase price adjustments (the "HHI Transaction").
−Removed: The Company's assets and liabilities associated with the HHI disposal group have been classified as held for sale and the respective operations have been classified as discontinued operations and reported separately for all periods presented.
The ASPA provides that ASSA will purchase the equity of certain subsidiaries of the Company, and acquire certain assets and assume certain liabilities of other subsidiaries used or held for the purpose of the HHI business.
The Company and ASSA have made customary representations and warranties and have agreed to customary covenants relating to the acquisition.
−Removed: Among other things, prior to the consummation of the HHI Transaction, the Company will be subject to certain business conduct restrictions with respect to its operation of the HHI business.
+Added: Among other things, prior to the consummation of the acquisition, the Company will be subject to certain business conduct restrictions with respect to its operation of the HHI business.
The Company and ASSA have agreed to indemnify each other for losses arising from certain breaches of the ASPA and for certain other matters.
In particular, the Company has agreed to indemnify ASSA for certain liabilities relating to the assets retained by the Company, and ASSA has agreed to indemnify the Company for certain liabilities assumed by ASSA, in each case as described in the ASPA.
−Removed: The Company and ASSA have agreed to enter into related agreements ancillary to the HHI Transaction that will become effective upon the consummation of the HHI Transaction, including customary transition services agreements ("TSA") and reverse TSAs.
−Removed: The consummation of the HHI Transaction is subject to certain customary closing conditions, including, among other things, (i) the absence of a material adverse effect on HHI, (ii) the expiration or termination of required waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, (iii) the receipt of certain other antitrust approvals in certain specified foreign jurisdictions, (iv) the accuracy of the representations and warranties of the parties generally subject to a customary material adverse effect standard (as described in the ASPA) or other customary materiality qualifications), (v) the absence of governmental restrictions on the consummation of the acquisition in certain jurisdictions, and (vi) material compliance by the parties with their respective covenants and agreements under the ASPA.
−Removed: The consummation of the HHI Transaction is not subject to any financing condition.
−Removed: Pursuant to the ASPA, either party may terminate the ASPA if the HHI Transaction has not occurred on or prior to December 8, 2022 (the “End Date”).
−Removed: On July 14, 2022, the parties entered into an amendment to the ASPA (the “Amendment”) pursuant to which the End Date was extended to June 30, 2023.
−Removed: Except for the foregoing amendment to the End Date, the ASPA remains in full force and effect as written, including with respect to a termination fee of $ 350 million.
+Added: The Company and ASSA have agreed to enter into related agreements ancillary to the acquisition that will become effective upon the consummation of the acquisition, including a customary transition services agreement and reverse transition services agreement.
+Added: The consummation of the acquisition is subject to certain customary conditions, including, among other things, (i) the absence of a material adverse effect on HHI, (ii) the expiration or termination of required waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, (iii) the receipt of certain other antitrust approvals in certain specified foreign jurisdictions (the conditions contained in (ii) and (iii) together, the “Antitrust Conditions”), (iv) the accuracy of the representations and warranties of the parties generally subject to a customary material adverse effect standard (as described in the ASPA) or other customary materiality qualifications), (v) the absence of governmental restrictions on the consummation of the acquisition in certain jurisdictions, and (vi) material compliance by the parties with their respective covenants and agreements under the ASPA.
+Added: The consummation of the acquisition is not subject to any financing condition.
+Added: The ASPA also contains certain termination rights, including the right of either party to terminate the ASPA if the consummation of the acquisition has not occurred on or before December 8, 2022 (the “Termination Date”).
+Added: Further, if the acquisition has not been consummated by the Termination Date and all conditions precedent to ASSA's obligation to consummate the acquisition have otherwise been satisfied except for one or more of the Antitrust Conditions, then ASSA would be required to pay the Company a termination fee of $ 350 million.
+Added: On July 14, 2022, the parties entered into an amendment to the ASPA (the “Amendment”) pursuant to which the Termination Date was extended to June 30, 2023.
+Added: Except for the foregoing amendment to the Termination Date, the ASPA remains in full force and effect as written, including with respect to the termination fee of $ 350 million.
The Company continues to engage with antitrust regulators in the regulatory review of the HHI transaction, and the extension is intended to provide the parties with additional time (to the extent needed) to satisfy the conditions related to receipt of governmental clearances.
+Added: On September 15, 2022, the Department of Justice ("DOJ") filed a complaint seeking to enjoin the transaction and block the acquisition of the HHI division by ASSA.
+Added: Both the Company and ASSA have stated their disagreement with the DOJ's concerns.
+Added: On December 2, 2022, ASSA announced an agreement to sell its Emtek and the Smart Residential Business in the U.S.
+Added: and Canada to Fortune Brands in response to competitive concerns raised by the DOJ in their complaint.
+Added: The Company expects that the trial will occur in April 2023.
+Added: The Company and ASSA will jointly defend the transaction in the litigation.
+Added: The Company continues to recognize the HHI division as held for sale and as a component of our discontinued operations.
The parties are committed to closing the HHI transaction, and the Company and ASSA both continue to expect that they will obtain all the required governmental clearances and will close the HHI transaction.
−Removed: The following table summarizes the assets and liabilities of the HHI disposal group classified as held for sale as of July 3, 2022 and September 30, 2021:
+Added: The following table summarizes the assets and liabilities of the HHI disposal group classified as held for sale as of January 1, 2023 and September 30, 2022:
(in millions)
−Removed: July 3, 2022 September 30, 2021
+Added: January 1, 2023 September 30, 2022
Trade receivables, net $ 111.3 $ 135.5
22 unchanged sentences
NOTE 2 – DIVESTITURES (continued)
−Removed: The following table summarizes the components of income from discontinued operations before income taxes associated with the HHI divestiture in the accompanying Condensed Consolidated Statements of Operations for the three and nine month periods ended July 3, 2022 and July 4, 2021:
−Removed: Three Month Periods Ended Nine Month Periods Ended
+Added: The following table summarizes the components of income from discontinued operations before income taxes associated with the HHI divestiture in the accompanying Condensed Consolidated Statements of Operations for the three month periods ended January 1, 2023 and January 2, 2022:
+Added: Three Month Periods Ended
(in millions)
−Removed: July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: January 1, 2023 January 2, 2022
Net sales $ 362.9 $ 374.7
4 unchanged sentences
Interest expense 0.8 0.9
−Removed: Other non-operating (income) expense, net ( 0.9 ) 1.5 2.0 5.2
+Added: Other non-operating expense, net 1.2 1.6
Income from discontinued operations before income taxes $ 45.0 $ 60.0
2 unchanged sentences
No impairment loss was recognized on the assets held for sale as the purchase price of the business less estimated cost to sell is more than its carrying value.
−Removed: The following table presents significant non-cash items and capital expenditures of discontinued operations from the HHI divestiture for the three and nine month periods ended July 3, 2022 and July 4, 2021:
−Removed: Three Month Periods Ended Nine Month Periods Ended
+Added: The following table presents significant non-cash items and capital expenditures of discontinued operations from the HHI divestiture for the three month periods ended January 1, 2023 and January 2, 2022:
+Added: Three Month Periods Ended
(in millions)
−Removed: July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
−Removed: Depreciation and amortization $ — $ 8.4 $ — $ 25.5
+Added: January 1, 2023 January 2, 2022
Share based compensation $ 0.9 $ 2.8
2 unchanged sentences
("Energizer") during the year ended September 30, 2019.
−Removed: The Company and Energizer agreed to indemnify each other for losses arising from certain breaches of the acquisition agreement and for certain other matters.
−Removed: The Company has agreed to indemnify for certain liabilities relating to the assets retained, and Energizer agreed to indemnify the Company for certain liabilities assumed, in each case as described in the acquisition agreements.
+Added: The Company and Energizer agreed to indemnify each other for losses arising from certain breaches of the acquisition agreement and for certain other matters, in each case as described in the acquisition agreements.
Subsequently, effective January 2, 2020, Energizer closed its divestitures of the European based Varta® consumer battery business in the EMEA region to Varta AG and transferred all respective rights and indemnifications attributable to the Varta® consumer battery business provided by the GBL sale to Varta AG.
−Removed: As of July 3, 2022 and September 30, 2021, the Company recognized $ 25.5 million and $ 36.5 million, respectively, related to indemnification payables in accordance with the acquisition agreements, including $ 9.4 million and $ 17.3 million within Other Current Liabilities, respectively, and $ 16.1 million and $ 19.2 million, within Other Long-Term Liabilities, respectively, on the Company’s Condensed Consolidated Statements of Financial Position, primarily attributable to income tax indemnifications associated with previously recognized uncertain tax benefits.
−Removed: The Company entered into a series of TSAs and reverse TSAs with Energizer to support various shared back office administrative functions including finance, sales and marketing, information technology, human resources, real estate and supply chain, customer service and procurement.
−Removed: TSAs associated with the Varta® consumer battery business were transferred to Varta AG as part of the subsequent divestiture by Energizer.
−Removed: Charges associated with TSAs were recognized as bundled service costs under a fixed fee structure by the respective service or function and geographic location, including one-time pass-through charges for warehousing, freight, amongst others, with variable expiration dates up to 24 months.
−Removed: Charges associated with TSAs and reverse TSAs are recognized as a reduction to or increase in the respective costs, as a component of operating expense or cost of goods sold, depending upon the functions supported by or provided to the Company.
−Removed: Additionally, due to the commingled nature of the shared administrative functions, cash would be received or paid on behalf of the respective counterparty's operations, resulting in cash flow being commingled with operating cash flow of the Company which would settle on a net basis with TSA charges.
−Removed: During the nine month period ended July 4, 2021, the Company recognized net loss of $ 1.7 million, consisting of TSA charges of $ 0.9 million and reverse TSA costs of $ 2.6 million.
−Removed: The Company exited all outstanding TSAs and reverse TSAs in January 2021.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in millions, unaudited)
−Removed: NOTE 3 – ACQUISITIONS
−Removed: Tristar Business Acquisition
−Removed: On February 18, 2022, the Company acquired all of the membership interests in HPC Brands, LLC, which consist of the home appliances and cookware business of Tristar Products, Inc.
−Removed: (the "Tristar Business") for a purchase price of $ 325.0 million, net of customary purchase price adjustments and transaction costs, plus a potential earn-out payment of up to $ 100.0 million if certain gross profit targets are achieved in calendar year 2022, and another earn-out payment of $ 25.0 million if certain other gross profit targets are achieved in calendar year 2023.
−Removed: The acquisition of the Tristar Business was funded by a combination of cash on hand and incremental borrowings incurred as a new tranche under the Company's existing credit agreement.
−Removed: See Note 10 - Debt for further detail on the amendment to the credit agreement.
−Removed: The Tristar Business includes a portfolio of home appliances and cookware products sold under the PowerXL®, Emeril Legasse®, and Copper Chef® brands.
−Removed: The PowerXL® and Copper Chef® brands were acquired outright by the Company while the Emeril Legasse® brand remains subject to a trademark license agreement with the license holder (the "Emeril License").
−Removed: Pursuant to the Emeril License, the Company will continue to license the Emeril Legasse® brands in the US, Canada, Mexico, and the United Kingdom for certain designated product categories of household appliances within the Home and Personal Care ("HPC") segment, including small kitchen food preparation products, indoor and outdoor grills and grill accessories, and cookbooks.
−Removed: The Emeril License is set to expire effective December 31, 2022 with options of up to three one-year renewal periods following the initial expiration.
−Removed: Under the terms of the agreement, we agreed to pay the license holder a percentage of sales, with minimum annual royalty payments of $ 1.5 million, increasing to $ 1.8 million in subsequent renewal periods.
−Removed: The net assets and operating results of the Tristar Business, since the acquisition date of February 18, 2022, are included in the Company’s Condensed Consolidated Statements of Income and reported within the HPC reporting segment for the three and nine month periods ended July 3, 2022.
−Removed: The Company has recorded a preliminary allocation of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the February 18, 2022 acquisition date.
−Removed: The excess of the purchase price over the fair value of the net tangible assets and identifiable intangible assets of $ 104.7 million was recorded as goodwill, which is deductible for tax purposes.
−Removed: Goodwill includes value associated with profits earned from market and expansion capabilities including the success of new product launches through direct response television and direct to consumer channels, new brand development and products brought to market by the Company, synergies from integration and streamlining operational activities, and the going concern of the business and the value of the assembled workforce.
−Removed: The preliminary fair values recorded were determined based upon a valuation with estimates and assumptions used in such valuation that are subject to change within the measurement period (up to one year from the acquisition date).
−Removed: The primary areas of acquisition accounting that are not finalized relate to amounts for deferred taxes, goodwill, and components of working capital.
−Removed: The calculation of preliminary purchase price is as follows:
−Removed: (in millions) Amount
−Removed: Cash paid at closing $ 314.6
−Removed: Cash received for purchase price settlement ( 42.2 )
−Removed: Contingent consideration 30.0
−Removed: Total purchase price $ 302.4
−Removed: As of the transaction date, the Company recorded a contingent consideration liability of $ 30.0 million to reflect the estimated fair value of the contingent consideration for the earn-out payments.
−Removed: The fair value was determined using a Monte Carlo simulation model to value the earn-out based on the likelihood of reaching specific targets.
−Removed: The fair value measurement is determined based on significant unobservable inputs and thus represents a Level 3 fair value measurement.
−Removed: The key assumptions considered include the estimated amount and timing of projected gross profits, volatility, estimated discount rates, and risk-free interest rate.
−Removed: The inputs and assumptions may not be observable in the market, but reflect the assumptions the Company believes would be made by a market participant.
−Removed: Subsequently, the Company and the acquired Tristar Business have experienced a marginal downturn in operating results during the three month period ended July 3, 2022 that was attributable to significant shifts in retail customer purchasing due to high levels of retail inventory and lower replenishment orders, especially with key significant mass retail customers, along with continued inflationary cost pressures and incremental margin risk from promotional spending, have adjusted the forecasted results of the Tristar Business and further impacted the value of the contingent consideration.
−Removed: As a result, the fair value of the contingent consideration liability as of July 3, 2022 was estimated to be $ 5.0 million and the Company recognized a decrease of $ 25.0 million for the three and nine month periods ended July 3, 2022.
−Removed: As of July 3, 2022, the current portion of the contingent consideration of $ 3.5 million was classified as Other Current Liabilities and the long-term portion of $ 1.5 million was classified as Other Long-Term Liabilities on the Company’s Condensed Consolidated Statements of Financial Position.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in millions, unaudited)
−Removed: NOTE 3 - ACQUISITIONS (continued)
−Removed: The following table summarizes the preliminary fair value of assets acquired and liabilities assumed as of the date of acquisition:
−Removed: (in millions) Amount
−Removed: Cash and cash equivalents $ 0.3
−Removed: Trade receivables, net 54.2
−Removed: Other receivables 0.4
−Removed: Inventories 102.0
−Removed: Prepaid expenses and other current assets 4.4
−Removed: Property, plant and equipment, net 0.4
−Removed: Operating lease assets 23.3
−Removed: Deferred charges and other 2.5
−Removed: Goodwill 104.7
−Removed: Intangible assets, net 95.0
−Removed: Accounts payable ( 52.5 )
−Removed: Accrued wages and salaries ( 0.6 )
−Removed: Other current liabilities ( 20.6 )
−Removed: Long-term operating lease liabilities ( 11.1 )
−Removed: Net assets acquired $ 302.4
−Removed: T he values allocated to intangible assets and the weighted average useful lives are as follows:
−Removed: (in millions) Carrying Amount Weighted Average Useful Life (Years)
−Removed: Tradenames $ 66.0 Indefinite
−Removed: Customer relationships 29.0 13 years
−Removed: Total intangibles acquired $ 95.0
−Removed: The Company performed a valuation of the acquired inventories, tradenames, and customer relationships.
−Removed: The fair value measurements are based on significant inputs not observable in the market, and therefore, represent Level 3 measurements.
−Removed: The following is a summary of significant inputs to the valuation:
−Removed: Inventory – Acquired inventory consists of branded finished goods that were valued based on the comparative sales method, which estimates the expected sales price of the finished goods inventory, reduced for all costs expected to be incurred in its completion or disposition and a profit on those costs.
−Removed: Tradename – The Company valued the PowerXL® tradename using an income approach, the relief-from-royalty method.
−Removed: Under this method, the asset value was determined by estimating the hypothetical royalties that would have to be paid if the tradenames were not owned.
−Removed: Royalty rate of 3 % for valuation of PowerXL® was selected based on consideration of several factors, including prior transactions, related trademarks and tradenames, other similar trademark licensing and transaction agreements and the relative profitability and perceived contribution of the tradenames.
−Removed: The discount rate applied to the projected cash flow was 16 % based on the implied transaction internal rate of return for the overall business, excluding cost synergies.
−Removed: The resulting discounted cash flows were then tax-effected at the applicable statutory rate.
−Removed: Customer relationships – The Company values customer relationships using the multi-period excess earnings method under a market participant distributor method of the income approach.
−Removed: In determining the fair value of the customer relationships, the multi-period excess earnings approach values the intangible asset at the present value of the incremental after-tax cash flows attributable only to the customer relationship after deducting contributory asset charges.
−Removed: Only expected sales from current retail customers were used, which are estimated using average annual expected growth rate of 2.7 %.
−Removed: The Company assumed a customer attrition rate of 5 %, which is supported by historical attrition rates.
−Removed: The discount rate applied to the projected cash flow was 12 % based upon a weighted average cost of capital for the overall business and income taxes were estimated at the applicable statutory rate.
−Removed: During the three and nine month periods ended July 3, 2022, the Company has recognized $ 65.8 million and $ 101.6 million of net sales from the acquired Tristar Business since the transaction date.
−Removed: The following pro forma financial information summarizes the combined results of operations for the Company and the acquired Tristar Business as though the companies were combined as of the beginning of the Company’s fiscal 2021.
−Removed: The unaudited pro forma financial information was as follows:
−Removed: Three Month Periods Ended Nine Month Periods Ended
−Removed: (in millions) July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
−Removed: Proforma net sales $ 818.0 $ 839.9 $ 2,583.1 $ 2,687.9
−Removed: Proforma net income (loss) from continuing operations 3.3 ( 2.0 ) ( 29.9 ) 21.1
−Removed: Proforma net income 33.2 30.6 79.9 151.3
−Removed: Proforma diluted earnings from continuing operations per share 0.08 ( 0.05 ) ( 0.73 ) 0.49
−Removed: Proforma diluted earnings per share 0.81 0.72 1.95 3.53
−Removed: The pro forma financial information includes, where applicable, adjustments for:
−Removed: (i) additional amortization expense that would have been recognized related to the acquired intangible assets, (ii) additional operating expense from the excess fair value adjustments on operating lease assets for below market rents (iv) additional cost of sales related to the inventory valuation adjustment, (v) transaction costs and other one-time non-recurring costs and (vi) the estimated income tax effect on the acquired Tristar Business and pro forma adjustments.
−Removed: During the nine month period ended July 3, 2022, the Company recognized $ 13.5 million of transaction costs attributable to the acquisition of the Tristar Business, included in General and Administrative Expense on the Condensed Consolidated Statement of Income.
+Added: As of January 1, 2023 and September 30, 2022, the Company recognized $ 23.7 million and $ 22.3 million, respectively, related to indemnification payables in accordance with the acquisition agreements, primarily attributable with uncertain tax benefit obligations and outstanding settlements with tax authorities that were transferred and indemnified in accordance with the acquisition agreement, including $ 7.1 million and $ 7.0 million within Other Current Liabilities, respectively, and $ 16.6 million and $ 15.3 million, within Other Long-Term Liabilities, respectively, on the Company’s Condensed Consolidated Statements of Financial Position.
SPECTRUM BRANDS HOLDINGS, INC.
2 unchanged sentences
(in millions, unaudited)
−Removed: NOTE 3 - ACQUISITIONS (continued)
−Removed: Through the acquisition of the Tristar Business, the Company acquired substantially all of the operations, employees and net assets of Tristar Products, Inc.
−Removed: and entered into a series of TSAs for various shared back office administrative functions including finance, sales and marketing, information technology, human resources, real estate and supply chain, customer service and procurement, to support the excluded product groups that did not convey with the transaction.
−Removed: Charges associated with TSAs are recognized as bundled service charges under a fixed fee structure by the respective service or function along with one-time pass-through charges, including warehousing, and freight, among others, from the acquired Tristar Business that settle on a net basis between the two parties.
−Removed: Charges for TSA services are recognized as a reduction to the respective operating costs as a component of operating expense or cost of goods sold depending upon the functions supported by the acquired Tristar Business.
−Removed: During the three and nine month periods ended July 3, 2022, the Company recognized TSA income of $ 0.3 million and $ 0.8 million, respectively.
−Removed: Additionally, the Company assumed the cash accounts supporting both the acquired Tristar Business and the excluded product groups, and due to the commingled nature of operations, cash would be received or paid on behalf of the excluded product groups' operations, resulting in cash flow being commingled with operating cash flow of the Company which would settle on a net basis with TSA charges.
−Removed: As of July 3, 2022, there was an outstanding receivable from Tristar Products, Inc.
−Removed: of $ 1.3 million included within Other Receivables on the Company’s Condensed Consolidated Statements of Financial Position.
NOTE 3 – RESTRUCTURING CHARGES
−Removed: The Company regularly enters into various restructuring initiatives, optimization projects, strategic transactions, and other business development activities that may include the recognition of exit or disposal costs.
−Removed: Exit or disposal costs include, but are not limited to, the costs of one-time termination benefits, such as a severance or retention bonuses, one-time contract termination costs (excluding leases), and other costs associated with exit or disposal activity such as the sale or termination of a line of business, closure of an operating facility or business location in a country or region, relocation of business activities from one location to another, change in management structure, and a fundamental reorganization that affects the nature and focus of operations.
−Removed: During the three month period ended July 3, 2022, the Company entered into a new initiative in response to changes observed within consumer products and retail markets, continued inflationary cost pressures and headwinds, and to facilitate changes in the management structure for enabling functions of the consolidated group, resulting in the realization of headcount reduction.
+Added: During the year ended September 30, 2022, the Company entered into a new initiative in response to changes observed within consumer products and retail markets, continued inflationary cost pressures and headwinds, and to facilitate changes in the management structure for enabling functions of the consolidated group, resulting in the realization of headcount reductions.
Total cumulative costs associated with the new restructuring initiative were $ 10.4 million.
−Removed: Substantially all costs associated with the initiative have been recognized with no further significant costs expected to be incurred.
−Removed: During the year ended September 30, 2021, the GPC segment entered into an initiative to update its supply chain and distribution operations within the U.S.
−Removed: to address capacity needs, and optimize and improve fill rates attributable to recent growth in the business and consumer demand, and improve overall operational effectiveness and throughput.
−Removed: The initiative includes the transition of its third party logistics (3PL) service provider at its existing distribution center, incorporating new facilities into the distribution footprint by expanding warehouse capacity and securing additional space to support long-term distribution and fulfillment, plus updating engagement and processes with suppliers and its transportation and logistics handlers.
−Removed: Incremental costs include one-time transition, implementation and start-up cost with the new 3PL service provider, including the integration of provider systems and technology, incentive-based compensation to maintain performance during transition, duplicative and redundant costs, and incremental costs for various disruptions in the operations during the transition period including supplemental transportation and storage costs, and incremental detention and demurrage costs.
−Removed: Costs attributable to the initiative are expected to be incurred through the end of the fiscal year ending September 30, 2022.
−Removed: Total cumulative costs associated with the initiative were $ 35.5 million with expected costs of approximately $ 4 million expected to be incurred.
−Removed: During the year ended September 30, 2019, the Company initiated the Global Productivity Improvement Program, which is a company-wide, multi-year program, consisting of various initiatives to redirect resources and spending to drive growth, identify cost savings and pricing opportunities through standardization and optimization, develop organizational and operating optimization, and reduce overall operational complexity across the Company.
−Removed: With the Company's divestitures of GBL and GAC during the year ended September 30, 2019, the project focus includes the transition of the Company's continuing operations in a post-divestiture environment and exiting of TSAs, which were fully exited in January 2022.
−Removed: The initiatives include review of global processes and organization design and structures, headcount reductions and transfers, and rightsizing the Company’s shared operations and commercial business strategy, and exit of certain internal production to third-party suppliers, among others, resulting in the recognition of severance benefits and other exit and disposal costs to facilitate such activity.
−Removed: As of July 3, 2022, total cumulative exit and disposal costs associated with the project were $ 157.5 million with the project being substantially complete and no significant anticipated costs expected to be incurred.
+Added: Substantially all costs associated with the initiative have been recognized in the prior year with incremental costs realized during the three month period ended January 1, 2023, which were attributable to changes in timing and accruals previously recognized since the initiative was established.
+Added: During the year ended September 30, 2022, the Company initiated the exit of its in-country commercial operations in Russia, predominantly supporting the HPC segment, including costs for severance and other exit and disposal activity to close the operations.
+Added: Total cumulative costs associated with the initiative were $ 1.2 million.
+Added: Substantially all costs, excluding lease termination or asset impairment costs associated with the initiative has been recognized.
The Company may enter into small, less significant initiatives to reduce costs and improve margins throughout the organization.
Individually these activities are not substantial and occur over a shorter time period (generally less than 12 months).
−Removed: The following summarizes restructuring charges for the three and nine month periods ended July 3, 2022 and July 4, 2021:
−Removed: Three Month Periods Ended Nine Month Periods Ended
+Added: The following summarizes restructuring charges for the three month periods ended January 1, 2023 and January 2, 2022:
+Added: Three Month Periods Ended
(in millions)
−Removed: July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: January 1, 2023 January 2, 2022
Fiscal 2022 restructuring $ 0.6 $ —
+Added: Russia dissolution 0.6 —
GPC distribution center transition — 10.3
5 unchanged sentences
General and administrative expense 1.6 6.8
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in millions, unaudited)
−Removed: NOTE 4 - RESTRUCTURING CHARGES (continued)
−Removed: The following is a summary of restructuring charges by segment for the three and nine month periods ended July 3, 2022 and July 4, 2021.
−Removed: Three Month Periods Ended Nine Month Periods Ended
−Removed: (in millions) July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: The following is a summary of restructuring charges by segment for the three month periods ended January 1, 2023 and January 2, 2022.
+Added: Three Month Periods Ended
+Added: (in millions) January 1, 2023 January 2, 2022
HPC $ 0.6 $ 0.6
−Removed: GPC 11.6 3.9 31.1 6.0
−Removed: H&G 0.6 — 0.6 —
Corporate 0.5 5.4
Total restructuring charges $ 2.0 $ 17.4
−Removed: The following is a summary of restructuring charges by cost type for the three and nine month periods ended July 3, 2022 and July 4, 2021.
+Added: The following is a summary of restructuring charges by cost type for the three month periods ended January 1, 2023 and January 2, 2022.
(in millions)
Benefits Other
−Removed: For the three month period ended July 3, 2022 $ 8.5 $ 9.0 $ 17.5
−Removed: For the three month period ended July 4, 2021 5.0 5.1 10.1
−Removed: For the nine month period ended July 3, 2022 10.4 41.0 51.4
−Removed: For the nine month period ended July 4, 2021 8.3 15.1 23.4
−Removed: The following is a rollforward of the accrual for restructuring charges by cost type for the nine month period ended July 3, 2022.
+Added: For the three month period ended January 1, 2023 $ 1.3 $ 0.7 $ 2.0
+Added: For the three month period ended January 2, 2022 0.6 16.8 17.4
+Added: The following is a rollforward of the accrual for restructuring charges by cost type for the three month period ended January 1, 2023.
(in millions) Termination
4 unchanged sentences
Foreign currency and other 0.2 — 0.2
−Removed: Accrual balance at July 3, 2022 $ 8.1 $ 2.3 $ 10.4
+Added: Accrual balance at January 1, 2023 $ 2.5 $ 0.3 $ 2.8
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (in millions, unaudited)
NOTE 4 – REVENUE RECOGNITION
The Company generates all of its revenue from contracts with customers.
−Removed: The following table disaggregates our revenue for the three and nine month periods ended July 3, 2022 and July 4, 2021, by the Company’s key revenue streams, segments and geographic region (based upon destination):
−Removed: Three Month Period Ended July 3, 2022 Three Month Period Ended July 4, 2021
+Added: The following table disaggregates our revenue for the three month periods ended January 1, 2023 and January 2, 2022, by the Company’s key revenue streams, segments and geographic region (based upon destination):
+Added: Three Month Period Ended January 1, 2023 Three Month Period Ended January 2, 2022
(in millions)
5 unchanged sentences
2.5 2.4 0.5 5.4 2.6 2.7 0.3 5.6
−Removed: 0.5 1.4 — 1.9 — 1.4 — 1.4
+Added: Service and other 0.5 1.5 — 2.0 — 1.8 — 1.8
Total Revenue
$ 364.4 $ 277.5 $ 71.4 $ 713.3 $ 379.7 $ 302.2 $ 75.3 $ 757.2
−Removed: Nine Month Period Ended July 3, 2022 Nine Month Period Ended July 4, 2021
−Removed: (in millions) HPC GPC H&G Total HPC GPC H&G Total
−Removed: Product Sales
−Removed: NA $ 434.3 $ 561.3 $ 462.4 $ 1,458.0 $ 369.3 $ 508.4 $ 456.4 $ 1,334.1
−Removed: EMEA 361.5 270.8 — 632.3 392.7 266.6 — 659.3
−Removed: LATAM 167.4 13.8 6.0 187.2 126.9 11.9 5.0 143.8
−Removed: APAC 53.7 29.9 — 83.6 53.2 28.3 — 81.5
−Removed: Licensing 7.4 7.0 1.9 16.3 8.7 6.8 1.8 17.3
−Removed: Other 0.9 4.7 — 5.6 — 4.3 — 4.3
−Removed: Total Revenue $ 1,025.2 $ 887.5 $ 470.3 $ 2,383.0 $ 950.8 $ 826.3 $ 463.2 $ 2,240.3
The Company offers standard warranty coverage on certain products that it sells and accounts for this as an assurance warranty.
1 unchanged sentence
See Note 16 - Commitments and Contingencies for further information regarding the Company’s standard warranties.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in millions, unaudited)
−Removed: NOTE 5 – REVENUE RECOGNITION (continued)
−Removed: With the acquisition of the Tristar Business, the Company also sells extended warranty coverage for certain Tristar products that are sold directly to consumers, which it accounts for as service warranties.
−Removed: In most cases, the extended warranty is sold as a separate contract and separate performance obligation that is distinct from the product.
−Removed: The extended warranty transaction revenue is initially recognized as deferred revenue and amortized on a straight-line basis to Net Sales over the life of the contracts following the standard warranty period.
−Removed: Revenue attributable to extended warranties was first recognized with the acquisition of the Tristar Business on February 18, 2022.
−Removed: See Note 3 - Acquisitions for more details.
−Removed: As of July 3, 2022, the Company had $ 1.2 million service warranty revenue deferred and included in Other Current Liabilities on the Condensed Consolidated Statements of Financial Position.
The Company has a broad range of customers, including many large mass retail customers.
−Removed: During the three month period ended July 3, 2022 there were two large retail customers each exceeding 10% of consolidated Net Sales and representing 34.3 % of consolidated Net Sales.
−Removed: During the three month period ended July 4, 2021 there was one large retail customer exceeding 10% of consolidated Net Sales and representing 20.4 % of consolidated Net Sales.
−Removed: During the nine month periods ended July 3, 2022 and July 4, 2021, there were two large retail customers each exceeding 10% of consolidated Net Sales and representing 33.3 % and 31.4 % of consolidated Net Sales, respectively.
−Removed: A significant portion of our product sales from our HPC segment, primarily in the NA and LATAM regions, are subject to the continued use and access to the Black & Decker ("B&D") brand through a license agreement with Stanley Black and Decker.
+Added: During the three month period ended January 1, 2023 and January 2, 2022, there were two large retail customers each exceeding 10% of consolidated Net Sales and representing 36.2 % and 33.0 %, respectively, of consolidated Net Sales.
+Added: A significant portion of our product sales from our HPC segment are subject to the continued use and access to the Black & Decker ("B&D") brand through a license agreement with Stanley Black and Decker.
The license agreement was renewed through June 30, 2025, including a sell-off period from April 1, 2025 to June 30, 2025 whereby the Company can continue to sell and distribute but no longer produce products subject to the license agreement.
−Removed: Net sales from B&D product sales consist of $ 102.4 million and $ 91.9 million for the three month periods ended July 3, 2022 and July 4, 2021, respectively.
−Removed: Net sales from B&D product sales consist of $ 332.4 million and $ 297.2 million for the nine month periods ended July 3, 2022 and July 4, 2021, respectively.
+Added: Net sales from B&D product sales consisted of $ 86.7 million, or 12.2 % of consolidated net sales, and $ 129.4 million, or 17.1 % of consolidated net sales, for the three month periods ended January 1, 2023 and January 2, 2022, respectively.
All other significant brands and tradenames used in the Company’s commercial operations are directly owned and not subject to further restrictions.
1 unchanged sentence
Estimated product returns are recorded as a reduction in reported revenues at the time of sale based upon historical product return experience, adjusted for known trends, to arrive at the amount of consideration expected to be received.
−Removed: The allowance for product returns as of July 3, 2022, and September 30, 2021 was $ 20.2 million and $ 11.8 million, respectively.
−Removed: The increase in allowance for product returns is due to the acquisition of the Tristar Business on February 18, 2022.
−Removed: See Note 3 - Acquisitions for further discussion on the Tristar Business acquisition.
+Added: The allowance for product returns as of January 1, 2023 and September 30, 2022 was $ 15.7 million and $ 15.5 million, respectively.
NOTE 5 – RECEIVABLES AND CONCENTRATION OF CREDIT RISK
−Removed: The allowance for credit losses on the Company's trade receivables as of July 3, 2022 and September 30, 2021 was $ 11.2 million and $ 6.7 million, respectively.
−Removed: The increase in allowance for credit losses is primarily due to the acquisition of the Tristar Business and increased recoverability risk from Russia commercial operations.
−Removed: See Note 3 - Acquisitions for further discussion on the Tristar Business acquisition.
+Added: The allowance for credit losses on the Company's trade receivables as of January 1, 2023 and September 30, 2022 was $ 9.4 million and $ 7.3 million, respectively.
The Company has a broad range of customers including many large mass retail customers.
−Removed: As of July 3, 2022 and September 30, 2021 there was one large retail customer exceeding 10% of consolidated Net Trade Receivables and representing 17.1 % and 14.7 %, respectively, of consolidated Net Trade Receivables.
+Added: As of January 1, 2023, there was one large retail customer exceeding 10% of consolidated Net Trade Receivables and representing 16.3 % of consolidated Net Trade Receivables.
+Added: As of September 30, 2022 there were two large retail customers exceeding 10% of consolidated Net Trade Receivables and representing and 21.9 % of consolidated Net Trade Receivables.
NOTE 6 – INVENTORIES
1 unchanged sentence
(in millions)
−Removed: July 3, 2022 September 30, 2021
+Added: January 1, 2023 September 30, 2022
Raw materials
3 unchanged sentences
$ 702.3 $ 780.6
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (in millions, unaudited
NOTE 7 – PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment consist of the following:
−Removed: (in millions) July 3, 2022 September 30, 2021
+Added: (in millions) January 1, 2023 September 30, 2022
Land, buildings and improvements $ 78.5 $ 75.7
5 unchanged sentences
Property, plant and equipment, net $ 264.2 $ 263.8
−Removed: Depreciation expense from property, plant, and equipment for the three month periods ended July 3, 2022 and July 4, 2021 was $ 12.3 million and $ 12.8 million, respectively, and for the nine month periods ended July 3, 2022 and July 4, 2021 was $ 36.6 million and $ 39.2 million, respectively.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in millions, unaudited)
+Added: Depreciation expense from property, plant, and equipment for the three month periods ended January 1, 2023 and January 2, 2022, was $ 12.2 million .
NOTE 8 – GOODWILL AND INTANGIBLE ASSETS
2 unchanged sentences
As of September 30, 2022 $ 108.1 $ 502.4 $ 342.6 $ 953.1
−Removed: Tristar Business acquisition (Note 3) 104.7 — — 104.7
+Added: Tristar Business acquisition adjustment 3.0 — — 3.0
Foreign currency impact — 8.9 — 8.9
−Removed: As of July 3, 2022 $ 104.7 $ 512.0 $ 342.6 $ 959.3
+Added: As of January 1, 2023 $ 111.1 $ 511.3 $ 342.6 $ 965.0
+Added: During the three month period ended January 1, 2023, the Company recognized incremental adjustments to HPC goodwill attributable to changes to the preliminary valuation of net assets acquired associated with the acquisition of the Tristar Business, previously acquired on February 18, 2022, primarily associated with the valuation of reserves on trade receivables and deferred tax assets as of the acquisition date.
+Added: The preliminary values recorded were determined based upon a valuation with estimates and assumptions used in such valuation that are subject to change within the measurement period (up to one year from the acquisition date).
+Added: There are no further adjustments anticipated on the valuation of acquired net assets.
+Added: See Note 4 - Acquisitions in the Notes to the Consolidated Financial Statements within the Company's Annual Report on Form 10-K, released on November 22, 2022, for further discussion on the Tristar Business acquisition.
The carrying value and accumulated amortization of intangible assets are as follows:
−Removed: July 3, 2022 September 30, 2021
+Added: January 1, 2023 September 30, 2022
(in millions) Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net
6 unchanged sentences
Total Intangible Assets $ 1,635.6 $ ( 424.8 ) $ 1,210.8 $ 1,612.0 $ ( 409.8 ) $ 1,202.2
−Removed: There were no triggering events or impairments of goodwill and intangible assets identified during the three and nine month periods ended July 3, 2022.
−Removed: Amortization expense from the intangible assets for the three month periods ended July 3, 2022 and July 4, 2021 was $ 13.1 million and $ 17.4 million, respectively, and for the nine month periods ended July 3, 2022 and July 4, 2021 was $ 39.9 million and $ 48.2 million, respectively.
+Added: There were no triggering events or impairments of goodwill and intangible assets identified during the three month period ended January 1, 2023.
+Added: Amortization expense from the intangible assets for the three month periods ended January 1, 2023 and January 2, 2022 was $ 10.4 million and $ 13.3 million, respectively.
Excluding the impact of any future acquisitions, dispositions or changes in foreign currency, the Company estimates annual amortization expense of intangible assets for the next five fiscal years will be as follows:
6 unchanged sentences
Debt consists of the following:
−Removed: July 3, 2022 September 30, 2021
+Added: January 1, 2023 September 30, 2022
(in millions) Amount Rate Amount Rate
18 unchanged sentences
Long-term debt, net of current portion $ 3,267.7 $ 3,144.5
−Removed: Borrowings from the original revolver capacity of $ 600 million under the Revolver Facility are subject to either adjusted London Inter-Bank Offered Rate ("LIBOR") plus margin ranging from 1.75 % to 2.75 % per annum, or base rate plus margin ranging from 0.75 % to 1.75 % per annum;
−Removed: and borrowings under the incremental revolver capacity of $ 500 million, per the third amendment to the Credit Agreement discussed below, are subject to Secured Overnight Financing Rate ("SOFR") plus margin ranging from 1.75 % to 2.75 % per annum or base rate plus margin ranging from 0.75 % to 1.75 %.
+Added: Our Revolver Facility has a total capacity of $ 1,100 million.
+Added: Borrowings from the initial revolver capacity of $ 600 million are subject to either adjusted London Inter-Bank Offered Rate ("LIBOR") plus margin ranging from 1.75 % to 2.75 % per annum, or base rate plus margin ranging from 0.75 % to 1.75 % per annum;
+Added: and borrowings under the incremental revolver capacity of $ 500 million, per the third amendment to the Amended and Restated Credit Agreement (the "Credit Agreement"), are subject to Secured Overnight Financing Rate ("SOFR") plus margin ranging from 1.75 % to 2.75 % per annum or base rate plus margin ranging from 0.75 % to 1.75 %.
+Added: Effective November 3, 2022, the applicable margin increased 25 bps resulting in an increase to the SOFR margin ranging from 2.00 % to 3.00 % per annum or base rate plus margin ranging from 1.00 % to 2.00 %, with subsequent increases of 25 bps each 90-day anniversary after the initial step-up date.
The LIBOR borrowings are subject to a 0.75 % LIBOR floor, and the SOFR borrowings are subject to a 0.50 % SOFR floor.
Our Revolver Facility allows for the LIBOR rate to be phased out and replaced with the SOFR, and therefore we do not anticipate a material impact by the expected upcoming LIBOR transition.
−Removed: As a result of borrowings and payments under the Revolver Facility, the Company had borrowing availability of $ 307.3 million at July 3, 2022, net of outstanding letters of credit of $ 17.7 million.
+Added: We expect the transition from the LIBOR rate to SOFR will be effective no later than the end of June 2023 As a result of borrowings and payments under the Revolver Facility, the Company had borrowing availability of $ 252.5 million at January 1, 2023, net of outstanding letters of credit of $ 17.5 million.
The Term Loan Facility is subject to a rate per annum equal to either (1) the LIBO Rate (as defined in the Credit Agreement), subject to a 0.50 % floor, adjusted for statutory reserves, plus a margin of 2.00 % per annum or (2) the Alternate Base Rate (as defined in the Credit Agreement), plus a margin of 1.00 % per annum.
−Removed: Credit Agreement
−Removed: On December 10, 2021, the Company entered into the second amendment to the Amended and Restated Credit Agreement (the "Credit Agreement") dated as of June 30, 2020.
−Removed: The second amendment includes certain modified terms from the existing Credit Agreement to provide for an alternate rate of interest to the Eurocurrency Rate applicable to Revolving Loans and Letters of Credit in Euro and Pounds Sterling.
−Removed: Pursuant to the second amendment, Sterling Overnight Index Average ("SONIA") replaced LIBO Rate as a reference rate for Revolving Loans and Letters of Credit denominated in Pounds Sterling and Euro Interbank Offered Rate ("EURIBOR") replaced LIBO Rate as a reference rate for Revolving Loans and Letters of Credit denominated in Euro.
−Removed: The Company currently has no borrowing under the Revolver Facility denominated in Euro or Pounds Sterling.
−Removed: On February 3, 2022, the Company entered into a third amendment to the Credit Agreement.
−Removed: The third amendment provides for incremental capacity on the Revolver Facility of $ 500 million that was used to support the acquisition of the Tristar Business and the continuing operations and working capital requirements of the Company.
−Removed: See Note 3 - Acquisitions for further discussion on the Tristar Business acquisition.
−Removed: Borrowings under the incremental capacity are subject to the same terms and conditions of the existing Revolver Facility, with a maturity date of June 30, 2025, other than a difference in borrowing rate which is subject to SOFR plus margin ranging from 1.75 % to 2.75 %, or base rate plus margin ranging from 0.75 % to 1.75 % per annum, with an increase by 25 basis points 270 days after the effective date of the third amendment and an additional 25 basis points on each 90 day anniversary of such date.
−Removed: The SOFR is subject to a 0.50 % floor.
−Removed: The Company incurred $ 7.6 million in connection with the third amendment, which have been capitalized as debt issuance costs and will be amortized over the remaining term of the Credit Agreement.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in millions, unaudited)
+Added: On November 17, 2022, the Company entered into the fourth amendment to the Credit Agreement to temporarily increase the maximum consolidated total net leverage ratio permitted to be no greater than 7.0 to 1.0 before returning to 6.0 to 1.0 at the earliest of (i) September 29, 2023, or (ii) 10 business days after the closing of the HHI divestiture or receipt of the related termination fee.
+Added: The Company incurred $ 2.3 million in connection with the fourth amendment, which has been recognized as interest expense for the three month period ended January 1, 2023.
NOTE 10 – DERIVATIVES
3 unchanged sentences
The Company periodically enters into forward foreign exchange contracts to hedge a portion of the risk from forecasted foreign currency denominated third party and intercompany sales or payments.
−Removed: These obligations generally require the Company to exchange foreign currencies for U.S.
−Removed: Dollars, Euros, Pound Sterling, Canadian Dollars, Australian Dollars, or Japanese Yen.
+Added: These obligations generally require the Company to exchange foreign currencies for Australian Dollars, Canadian Dollars, Euros, Japanese Yen, Pound Sterling, or U.S.
These foreign exchange contracts are cash flow hedges of fluctuating foreign exchange related to inventory purchases or the sale of product.
1 unchanged sentence
At the time the sale or purchase is recognized, the fair value of the related hedge is reclassified as an adjustment to purchase price variance in Cost of Goods Sold or Net Sales on the Condensed Consolidated Statements of Income.
−Removed: At July 3, 2022, the Company had a series of foreign exchange derivative contracts outstanding through December 29, 2023.
−Removed: The derivative net gain estimated to be reclassified from AOCI into earnings over the next 12 months is $ 6.5 million, net of tax.
−Removed: At July 3, 2022 and September 30, 2021, the Company had foreign exchange derivative contracts designated as cash flow hedges with a notional value of $ 106.7 million and $ 279.9 million, respectively.
−Removed: The following table summarizes the impact of designated cash flow hedges and the pre-tax gain (loss) recognized in the Condensed Consolidated Statements of Income for the three and nine month periods ended July 3, 2022 and July 4, 2021, respectively:
−Removed: Gain (Loss) in OCI Reclassified Gain (Loss) to Continuing Operations
−Removed: For the three month periods ended (in millions) July 3, 2022 July 4, 2021 Line Item July 3, 2022 July 4, 2021
−Removed: Foreign exchange contracts $ 0.1 $ — Net sales $ 0.1 $ 0.1
−Removed: Foreign exchange contracts 7.9 ( 1.5 ) Cost of goods sold 4.8 ( 2.7 )
−Removed: Total $ 8.0 $ ( 1.5 ) $ 4.9 $ ( 2.6 )
−Removed: Gain (Loss) in OCI Reclassified Gain (Loss) to Continuing Operations
−Removed: For the nine month periods ended (in millions)
−Removed: July 3, 2022 July 4, 2021 Line Item July 3, 2022 July 4, 2021
+Added: At January 1, 2023, the Company had a series of foreign exchange derivative contracts outstanding through June 2024.
+Added: The derivative net loss estimated to be reclassified from AOCI into earnings over the next 12 months is $ 7.8 million, net of tax.
+Added: At January 1, 2023 and September 30, 2022, the Company had foreign exchange derivative contracts designated as cash flow hedges with a notional value of $ 320.1 million and $ 289.5 million, respectively.
+Added: The following table summarizes the impact of designated cash flow hedges and the pre-tax gain (loss) recognized in the Condensed Consolidated Statements of Income for the three month periods ended January 1, 2023 and January 2, 2022, respectively:
+Added: Unrealized Gain (Loss) in OCI Before Reclassification Reclassified Gain (Loss) to Continuing Operations
+Added: For the three month periods ended (in millions) January 1, 2023 January 2, 2022 Line Item January 1, 2023 January 2, 2022
Foreign exchange contracts $ — $ — Net sales $ 0.1 $ —
1 unchanged sentence
Total $ ( 25.7 ) $ ( 0.8 ) $ 2.5 $ 2.1
−Removed: During the three and nine month periods ended July 3, 2022, the Company settled certain cash flow hedges prior to their stated maturity that were in place to hedge forecasted U.S.
−Removed: Dollar denominated inventory purchases in exchange for Euros, but were subsequently discontinued due to changes in the Company's forecasted purchasing strategy of finished goods inventory within the EMEA region.
−Removed: As a result, there was a realized gain of $ 8.2 million during the three and nine month periods ended July 3, 2022 and recognized as a component of Cost of Goods Sold, included in the activity summarized above.
−Removed: Derivative Contracts Not Designated as Hedges for Accounting Purposes
−Removed: The Company periodically enters into foreign exchange forward contracts to economically hedge a portion of the risk from third party and intercompany payments resulting from existing obligations.
−Removed: These obligations generally require the Company to exchange foreign currencies for U.S.
−Removed: Dollars, Canadian Dollars, Euros, Pounds Sterling, Australian Dollars Mexican Pesos, Japanese Yen, Colombian Peso, Polish Zlotys, Hungarian Forint, or Turkish Lira, among others.
−Removed: These foreign exchange contracts are fair value hedges of a related liability or asset recorded in the accompanying Condensed Consolidated Statements of Financial Position.
−Removed: The gain or loss on the derivative hedge contracts is recorded in earnings as an offset to the change in value of the related liability or asset at each period end.
−Removed: At July 3, 2022, the Company had a series of forward exchange contracts outstanding through December 23, 2022.
−Removed: At July 3, 2022 and September 30, 2021, the Company had $ 332.7 million and $ 198.4 million, respectively, of notional value of such foreign exchange derivative contracts outstanding.
−Removed: The following summarizes the impact of derivative instruments on the accompanying Condensed Consolidated Statements of Income for the three and nine month periods ended July 3, 2022 and July 4, 2021, pre-tax:
−Removed: Three Month Periods Ended Nine Month Periods Ended
−Removed: (in millions) Line Item July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
−Removed: Foreign exchange contracts Other non-operating expense (income) $ 6.2 $ 2.5 $ 5.3 $ ( 6.0 )
SPECTRUM BRANDS HOLDINGS, INC.
3 unchanged sentences
NOTE 10 – DERIVATIVES (continued)
+Added: Derivative Contracts Not Designated as Hedges for Accounting Purposes
+Added: The Company periodically enters into foreign exchange forward contracts to economically hedge a portion of the risk from third party and intercompany payments resulting from existing obligations.
+Added: These obligations generally require the Company to exchange foreign currencies for, among others, Australian Dollars, Canadian Dollars, Euros, Japanese Yen, Mexican Pesos, Colombian Peso, Philippine Pesos, Hungarian Forint, Turkish Lira, Pounds Sterling, Taiwanese Dollars or U.S.
+Added: These foreign exchange contracts are fair value hedges of a related liability or asset recorded in the accompanying Condensed Consolidated Statements of Financial Position.
+Added: The gain or loss on the derivative hedge contracts is recorded in earnings as an offset to the change in value of the related liability or asset at each period end.
+Added: At January 1, 2023, the Company had a series of forward exchange contracts outstanding through July 2023.
+Added: At January 1, 2023 and September 30, 2022, the Company had $ 511.8 million and $ 513.7 million, respectively, of notional value of such foreign exchange derivative contracts outstanding.
+Added: The following summarizes the impact of derivative instruments on the accompanying Condensed Consolidated Statements of Income for the three month periods ended January 1, 2023 and January 2, 2022, pre-tax:
+Added: Three Month Periods Ended
+Added: (in millions) Line Item January 1, 2023 January 2, 2022
+Added: Foreign exchange contracts Other non-operating expense (income) $ ( 22.3 ) $ ( 1.2 )
Fair Value of Derivative Instruments
The fair value of the Company’s outstanding derivative contracts recorded in the Condensed Consolidated Statements of Financial Position is as follows:
−Removed: (in millions) Line Item July 3, 2022 September 30, 2021
+Added: (in millions) Line Item January 1, 2023 September 30, 2022
Derivative Assets
5 unchanged sentences
Foreign exchange contracts – designated as hedge Accounts payable $ 11.6 $ —
+Added: Foreign exchange contracts – designated as hedge Other long term liabilities 2.8 1.0
Foreign exchange contracts – not designated as hedge Accounts payable 1.0 5.0
3 unchanged sentences
The maximum loss due to credit risk equals the fair value of the gross asset derivatives that are concentrated with certain domestic and foreign financial institution counterparties.
−Removed: The Company considers these exposures when measuring its credit reserve on its derivative assets, which were not significant as of July 3, 2022.
+Added: The Company considers these exposures when measuring its credit reserve on its derivative assets, which were not significant as of January 1, 2023.
The Company’s standard contracts do not contain credit risk related contingent features whereby the Company would be required to post additional cash collateral because of a credit event.
However, the Company is typically required to post collateral in the normal course of business to offset its liability positions.
−Removed: As of July 3, 2022, and September 30, 2021, there was no cash collateral outstanding and no posted standby letters of credit related to such liability positions.
+Added: As of January 1, 2023 and September 30, 2022, there was no cash collateral outstanding and no posted standby letters of credit related to such liability positions.
Net Investment Hedge
3 unchanged sentences
Any gains and losses attributable to the translation of the Euro denominated debt designated as net investment hedge are recognized as a component of foreign currency translation within AOCI, and gains and losses attributable to the translation of the undesignated portion are recognized as foreign currency translation gains or losses within Other Non-Operating Expense (Income).
−Removed: As of July 3, 2022, the full principal amount was designated as a net investment hedge and considered fully effective.
−Removed: The following summarizes the gain (loss) from the net investment hedge recognized in Other Comprehensive Income for the three and nine month periods ended July 3, 2022 and July 4, 2021, pre-tax:
−Removed: Three Month Periods Ended Nine Month Periods Ended
−Removed: Gain (Loss) in OCI (in millions) July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
−Removed: Net investment hedge $ 24.8 $ ( 3.4 ) $ 47.3 $ ( 4.8 )
Net gains or losses from the net investment hedge are reclassified from AOCI into earnings upon a liquidation event or deconsolidation of Euro denominated subsidiaries.
+Added: As of January 1, 2023, the full principal amount was designated as a net investment hedge and considered fully effective.
+Added: The following summarizes the unrealized gain (loss) from the net investment hedge recognized in Other Comprehensive Income for the three month periods ended January 1, 2023 and January 2, 2022, pre-tax:
+Added: Three Month Periods Ended
+Added: Unrealized Gain (Loss) in OCI (in millions) January 1, 2023 January 2, 2022
+Added: Net investment hedge $ ( 33.9 ) $ 10.6
SPECTRUM BRANDS HOLDINGS, INC.
4 unchanged sentences
The Company has not changed the valuation techniques used in measuring the fair value of any financial assets and liabilities during the year.
−Removed: The carrying value and estimated fair value of financial instruments as of July 3, 2022 and September 30, 2021 according to the fair value hierarchy are as follows:
−Removed: July 3, 2022 September 30, 2021
+Added: The carrying value and estimated fair value of financial instruments as of January 1, 2023 and September 30, 2022 according to the fair value hierarchy are as follows:
+Added: January 1, 2023 September 30, 2022
(in millions) Level 1 Level 2 Level 3 Fair Value Carrying
8 unchanged sentences
Goodwill, intangible assets and other long-lived assets are tested annually or more frequently if an event occurs that indicates an impairment loss may have been incurred using fair value measurements with unobservable inputs (Level 3).
−Removed: During the three month period ended January 3, 2021, the Company held equity investments in Energizer common stock valued at quoted market prices, recognizing unrealized income from changes in fair value and realized income from the sale of its investment, plus dividend income on the Condensed Consolidated Statements of Income.
−Removed: The Company sold its remaining investment in Energizer common stock in January 2021.
−Removed: The following is a summary of amounts recognized as a component of Other Non-Operating Expense (Income) in the Company's Condensed Consolidated Statements of Income:
−Removed: Nine Month Period Ended
−Removed: (in millions) July 4, 2021
−Removed: Realized gain on equity investments sold $ 6.9
−Removed: Dividend income from equity investments 0.2
−Removed: Gain from equity investments $ 7.1
NOTE 12 – SHAREHOLDERS' EQUITY
3 unchanged sentences
The authorization is effective for 36 months.
−Removed: As part of our share repurchase programs, the Company purchased treasury shares in open market purchases at market fair value, private purchases from Company employees, significant shareholders or beneficial interest owners at fair value.
−Removed: The following summarizes the activity of common stock repurchases for the three and nine month periods ended July 3, 2022 and July 4, 2021:
−Removed: July 3, 2022 July 4, 2021
+Added: As part of our share repurchase programs, the Company has purchased treasury shares in open market purchases at market fair value along with participating in private purchases from Company employees, significant shareholders and beneficial interest owners at fair value.
+Added: The following summarizes the activity of common stock repurchases for the three month periods ended January 1, 2023 and January 2, 2022:
+Added: January 1, 2023 January 2, 2022
Three Month Periods Ended
1 unchanged sentence
Open Market Purchases — $ — $ — 1.1 $ 97.44 $ 110.0
−Removed: July 3, 2022 July 4, 2021
−Removed: Nine Month Periods Ended
−Removed: (in millions except per share data)
−Removed: Repurchased Average
−Removed: Per Share Amount Number of
−Removed: Repurchased Average
−Removed: Per Share Amount
−Removed: Open Market Purchases 1.3 $ 97.34 $ 134.0 0.1 $ 88.22 $ 10.2
−Removed: Private Purchases — — — 0.6 65.27 42.3
−Removed: Total Purchases 1.3 $ 97.34 $ 134.0 0.7 $ 68.73 $ 52.5
−Removed: During the fourth quarter ended September 30, 2021, SBH entered into a $ 150.0 million rule 10b5-1 repurchase plan to facilitate daily market share repurchases through September 16, 2022, until the cap is reached or until the plan is terminated.
−Removed: The Company completed share repurchases of $ 150.0 million under the rule 10b5-1 repurchase plan during the nine month period ended July 3, 2022.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in millions, unaudited)
NOTE 13 – SHARE BASED COMPENSATION
−Removed: The following is a summary of share based compensation expense for the three and nine month periods ended July 3, 2022 and July 4, 2021 for SBH and SB/RH, respectively.
−Removed: Three Month Periods Ended Nine Month Periods Ended
−Removed: (in millions) July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: The following is a summary of share based compensation expense for the three month periods ended January 1, 2023 and January 2, 2022 for SBH and SB/RH, respectively.
+Added: Three Month Periods Ended
+Added: (in millions) January 1, 2023 January 2, 2022
SBH $ 3.3 $ 5.6
11 unchanged sentences
Shares issued upon exercise of RSUs are sourced from treasury shares when available.
−Removed: The following is a summary of RSU grants issued during the nine month period ended July 3, 2022:
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (in millions, unaudited)
+Added: NOTE 13 – SHARE BASED COMPENSATION (continued)
+Added: The following is a summary of RSU grants issued during the three month period ended January 1, 2023:
(in millions, except per share data) Units Weighted
8 unchanged sentences
Total grants 0.47 $ 49.78 $ 23.3 0.44 $ 49.78 $ 21.8
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in millions, unaudited)
NOTE 14 – ACCUMULATED OTHER COMPREHENSIVE INCOME
−Removed: The change in the components of AOCI for the nine month period ended July 3, 2022 was as follows:
+Added: The change in the components of AOCI for the three month period ended January 1, 2023, was as follows:
(in millions) Foreign Currency Translation Derivative Instruments Defined Benefit Pension Total
1 unchanged sentence
$ ( 285.9 ) $ 16.8 $ ( 34.0 ) $ ( 303.1 )
−Removed: Other comprehensive income before reclassification 6.8 1.2 0.6 8.6
+Added: Other comprehensive income (loss) before reclassification 26.6 ( 25.4 ) ( 2.3 ) ( 1.1 )
Net reclassification for (gain) loss to income from continuing operations — ( 2.5 ) 0.9 ( 1.6 )
−Removed: Net reclassification for gain to income from discontinued operations — ( 0.5 ) — ( 0.5 )
Other comprehensive income (loss) before tax 26.6 ( 27.9 ) ( 1.4 ) ( 2.7 )
1 unchanged sentence
Other comprehensive income (loss), net of tax 35.4 ( 20.7 ) ( 0.2 ) 14.5
+Added: other comprehensive income from continuing operations attributable to non-controlling interest 0.2 — — 0.2
other comprehensive income from discontinued operations attributable to non-controlling interest 0.1 — — 0.1
1 unchanged sentence
Balance at January 1, 2023 $ ( 250.8 ) $ ( 3.9 ) $ ( 34.2 ) $ ( 288.9 )
−Removed: Other comprehensive (loss) income before reclassification ( 1.6 ) 6.4 1.0 5.8
−Removed: Net reclassification for (gain) loss to income from continuing operations — ( 1.5 ) 1.0 ( 0.5 )
−Removed: Net reclassification for gain to income from discontinued operations — ( 0.7 ) — ( 0.7 )
−Removed: Other comprehensive (loss) income before tax ( 1.6 ) 4.2 2.0 4.6
−Removed: Deferred tax effect ( 3.1 ) ( 1.0 ) ( 0.6 ) ( 4.7 )
−Removed: Other comprehensive (loss) income, net of tax ( 4.7 ) 3.2 1.4 ( 0.1 )
−Removed: other comprehensive loss from continuing operations attributable to non-controlling interest ( 0.1 ) — — ( 0.1 )
−Removed: Other comprehensive (loss) income attributable to controlling interest ( 4.6 ) 3.2 1.4 —
−Removed: Balance at April 3, 2022 $ ( 197.2 ) $ 12.7 $ ( 46.8 ) $ ( 231.3 )
−Removed: Other comprehensive (loss) income before reclassification ( 26.7 ) 4.3 2.3 ( 20.1 )
−Removed: Net reclassification for (gain) loss to income from continuing operations — ( 4.9 ) 1.1 ( 3.8 )
−Removed: Net reclassification for gain to income from discontinued operations — ( 0.9 ) ( 0.1 ) ( 1.0 )
−Removed: Other comprehensive (loss) income before tax ( 26.7 ) ( 1.5 ) 3.3 ( 24.9 )
−Removed: Deferred tax effect ( 6.6 ) 0.9 ( 0.9 ) ( 6.6 )
−Removed: Other comprehensive (loss) income, net of tax ( 33.3 ) ( 0.6 ) 2.4 ( 31.5 )
−Removed: other comprehensive loss from continuing operations attributable to non-controlling interest ( 0.1 ) — — ( 0.1 )
−Removed: other comprehensive loss from discontinued operations attributable to non-controlling interest ( 0.3 ) — — ( 0.3 )
−Removed: Other comprehensive (loss) income attributable to controlling interest ( 32.9 ) ( 0.6 ) 2.4 ( 31.1 )
−Removed: Balance at July 3, 2022 $ ( 230.1 ) $ 12.1 $ ( 44.4 ) $ ( 262.4 )
The following table presents reclassifications of the gain (loss) on the Condensed Consolidated Statements of Income from AOCI for the periods indicated:
−Removed: (in millions) Three Month Period Ended July 3, 2022 Nine Month Period Ended July 3, 2022
−Removed: Defined Benefit Pension Derivative Instruments Total Defined Benefit Pension Derivative Instruments Total
+Added: (in millions) Three Month Period Ended January 1, 2023
+Added: Derivative Instruments Defined Benefit Pension Total
Net Sales $ 0.1 $ — $ 0.1
1 unchanged sentence
Other non-operating expense (income), net — ( 0.9 ) ( 0.9 )
−Removed: Income from discontinued operations, net of tax 0.1 0.9 1.0 0.1 2.1 2.2
SPECTRUM BRANDS HOLDINGS, INC.
3 unchanged sentences
NOTE 14 – ACCUMULATED OTHER COMPREHENSIVE INCOME (continued)
−Removed: The change in the components of AOCI for the nine month period ended July 4, 2021 was as follows:
+Added: The change in the components of AOCI for the three month period ended January 2, 2022, was as follows:
(in millions) Foreign Currency Translation Derivative Instruments Defined Benefit Pension Total
1 unchanged sentence
$ ( 194.8 ) $ 6.4 $ ( 46.9 ) $ ( 235.3 )
−Removed: Other comprehensive income (loss) income before reclassification 19.4 ( 12.4 ) ( 2.2 ) 4.8
−Removed: Net reclassification for loss to income from continuing operations — 2.6 1.1 3.7
−Removed: Net reclassification for loss to income from discontinued operations — 0.1 — 0.1
+Added: Other comprehensive income before reclassification 6.8 1.2 0.6 8.6
+Added: Net reclassification for (gain) loss to income from continuing operations — ( 2.1 ) 1.0 ( 1.1 )
+Added: Net reclassification for gain to income from discontinued operations — ( 0.5 ) — ( 0.5 )
Other comprehensive income (loss) before tax 6.8 ( 1.4 ) 1.6 7.0
2 unchanged sentences
other comprehensive income from continuing operations attributable to non-controlling interest 0.1 — — 0.1
−Removed: other comprehensive income from discontinued operations attributable to non-controlling interest 0.3 — — 0.3
Other comprehensive income (loss) attributable to controlling interest 2.2 3.1 ( 1.3 ) 4.0
Balance at January 2, 2022 $ ( 192.6 ) $ 9.5 $ ( 48.2 ) $ ( 231.3 )
−Removed: Other comprehensive income before reclassification 22.2 5.8 0.9 28.9
−Removed: Net reclassification for loss to income from continuing operations — 3.1 1.1 4.2
−Removed: Net reclassification for gain to income from discontinued operations — ( 0.1 ) — ( 0.1 )
−Removed: Other comprehensive income before tax 22.2 8.8 2.0 33.0
−Removed: Deferred tax effect ( 5.0 ) ( 2.4 ) ( 0.6 ) ( 8.0 )
−Removed: Other comprehensive income, net of tax 17.2 6.4 1.4 25.0
−Removed: other comprehensive loss from continuing operations attributable to non-controlling interest ( 0.1 ) — — ( 0.1 )
−Removed: Other comprehensive income attributable to controlling interest 17.3 6.4 1.4 25.1
−Removed: Balance at April 4, 2021 ( 185.0 ) 2.8 ( 61.2 ) ( 243.4 )
−Removed: Other comprehensive income (loss) before reclassification 1.0 ( 1.0 ) ( 0.2 ) ( 0.2 )
−Removed: Net reclassification for loss to income from continuing operations — 2.6 1.1 3.7
−Removed: Net reclassification for loss to income from discontinued operations — 0.2 ( 0.1 ) 0.1
−Removed: Other comprehensive income before tax 1.0 1.8 0.8 3.6
−Removed: Deferred tax effect 0.9 ( 0.4 ) ( 0.2 ) 0.3
−Removed: Other comprehensive income, net of tax 1.9 1.4 0.6 3.9
−Removed: other comprehensive income from discontinued operations attributable to non-controlling interest 0.1 — — 0.1
−Removed: Other comprehensive income attributable to controlling interest 1.8 1.4 0.6 3.8
−Removed: Balance at July 4, 2021 $ ( 183.2 ) $ 4.2 $ ( 60.6 ) $ ( 239.6 )
The following table presents reclassifications of the gain (loss) on the Condensed Consolidated Statements of Income from AOCI for the periods indicated:
−Removed: (in millions) Three Month Period Ended July 4, 2021 Nine Month Period Ended July 4, 2021
−Removed: Defined Benefit Pension Derivative Instruments Total Defined Benefit Pension Derivative Instruments Total
−Removed: Net Sales $ — $ 0.1 $ 0.1 $ — $ 0.1 $ 0.1
+Added: (in millions) Three Month Period Ended January 2, 2022
+Added: Derivative Instruments Defined Benefit Pension Total
Cost of goods sold $ 2.1 $ — $ 2.1
1 unchanged sentence
Income from discontinued operations, net of tax 0.5 — 0.5
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (in millions, unaudited)
NOTE 15 – INCOME TAXES
−Removed: The effective tax rate for the three and nine month periods ended July 3, 2022 and July 4, 2021 was as follows:
−Removed: Three Month Periods Ended Nine Month Periods Ended
−Removed: Effective tax rate July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: The effective tax rate for the three month periods ended January 1, 2023 and January 2, 2022, was as follows:
+Added: Three Month Periods Ended
+Added: Effective tax rate January 1, 2023 January 2, 2022
SBH 23.3 % 34.7 %
SB/RH 23.5 % 34.5 %
−Removed: The estimated annual effective tax rate applied to the three and nine month periods ended July 3, 2022 differs from the US federal statutory rate of 21 % principally due to income earned outside the U.S.
+Added: The estimated annual effective tax rate applied to the three month periods ended January 1, 2023, differs from the US federal statutory rate of 21 % principally due to income earned outside the U.S.
that is subject to U.S.
tax, including the U.S.
−Removed: tax on global intangible low taxed income (“GILTI”), certain nondeductible expenses, foreign rates that differ from the U.S.
−Removed: federal statutory rate, and state income taxes.
+Added: tax on global intangible low taxed income (“GILTI”), certain nondeductible expenses, and foreign rates that differ from the U.S.
+Added: federal statutory rate.
The Company has U.S.
1 unchanged sentence
The Company’s federal effective tax rate on GILTI is therefore 21 %.
−Removed: During the nine month period ended July 3, 2022, the Company recorded a $ 3.2 million tax benefit as an adjustment to the estimated benefit recorded in Fiscal 2021 for the Final Regulations issued under Internal Revenue Code Section 951A relating to the treatment of income that is subject to a high rate of tax under the GILTI regime.
−Removed: The Company completed and filed the amended return implementing these Regulations during the nine month period ending July 3, 2022.
−Removed: The Company also recorded a $ 2.5 million tax benefit during the nine month period ended July 3, 2022 for windfalls associated with the vesting of share compensation during the year.
−Removed: The Company generated a pretax loss on continuing operations year to date, so additional discrete tax benefits result in an increase to the tax rate.
−Removed: In addition, the Company recorded $ 2.2 million of tax expense during the three and nine month periods ended July 3, 2022 for taxes associated with preparing the Company for a strategic separation of the HPC segment.
−Removed: The Company expects to record additional taxes related to the transactions necessary to prepare for a strategic separation in the three month period ending September 30, 2022.
−Removed: On April 4, 2022, the U.S.
−Removed: District Court for the District of Colorado ruled that the IRC Section 245A temporary regulations (“245A Regulations”) adopted by the Treasury Department in June of 2019 were invalid.
−Removed: The ruling is expected to be appealed, and the Company has been advised that similar challenges are ongoing in other U.S.
−Removed: Subsequent to the end of the quarter, the Company filed a protective amended U.S.
−Removed: income tax return consistent with the 245A Regulations being invalid.
−Removed: The Company has determined that this position is not more likely than not to be upheld and therefore did not record a tax benefit for this amended return in the period ended July 3, 2022.
−Removed: Should the 245A Regulations ultimately be found invalid, the Company estimates it would recognize a tax benefit of approximately $ 64.2 million.
−Removed: As of July 3, 2022, and September 30, 2021, there was $ 8.3 million of income tax receivable and $ 8.0 million of income taxes payable, respectively, with its parent company, on the SB/RH Condensed Consolidated Statements of Financial Position, calculated as if SB/RH were a separate taxpayer.
+Added: As of January 1, 2023 and September 30, 2022, there was $ 1.0 million and $ 2.7 million of income taxes receivable from its parent company on the SB/RH Condensed Consolidated Statements of Financial Position, calculated as if SB/RH were a separate taxpayer.
SPECTRUM BRANDS HOLDINGS, INC.
5 unchanged sentences
Based on information currently available, the Company does not believe that any additional matters or proceedings presently pending will have a material adverse effect on its results of operations, financial condition, liquidity or cash flows.
−Removed: Shareholder Litigation.
−Removed: On July 12, 2019, an amended consolidated class action complaint filed earlier in 2018 was filed in the United States District Court for the Western District of Wisconsin (the “Court”) by the Public School Teachers’ Pension & Retirement Fund of Chicago and the Cambridge Retirement against Spectrum Brands’ Legacy, Inc.
−Removed: (“Spectrum Legacy”).
−Removed: The complaint alleges that the defendants violated the Securities Exchange Act of 1934.
−Removed: The amended complaint added HRG Group, Inc.
−Removed: (“HRG”), the predecessor to the Company, as a defendant and asserted additional claims against the Company on behalf of a purported class of HRG shareholders.
−Removed: The class period of the consolidated amended complaint is from January 26, 2017 to November 19, 2018, and the plaintiffs seek an unspecified amount of compensatory damages, interest, attorneys’ and expert fees and costs.
−Removed: During the year ended September 30, 2020, the Company reached a proposed settlement resulting in an insignificant loss, net of third-party insurance coverage and payment, pending final approval by the Court.
−Removed: In February 2021, the Court declined to approve the proposed settlement without prejudice because the Court determined that as a procedural matter the plaintiff’s counsel had not taken the appropriate actions to be appointed to represent the purported class of HRG shareholders.
−Removed: The court subsequently appointed separate counsel to represent the HRG shareholder class.
−Removed: In August 2021, the Company reached an agreement in principle to settle the claims of the Spectrum Legacy class, the cost of which has been defrayed by third-party insurance.
−Removed: In October 2021, the Company reached an agreement in principle to settle the claims of the HRG class, the cost of which also has been defrayed by third-party insurance.
−Removed: In March 2022, the court granted approval to both settlements.
Environmental Liability.
The Company has realized commitments attributable to environmental remediation activities primarily associated with former manufacturing sites of the Company's HPC segment.
−Removed: In coordination with local and federal regulatory agencies, we have conducted testing on certain sites which have resulted in the identification of contamination that has been attributed to historic activities at the properties, resulting in the realization of incremental costs to be assumed by the Company towards the remediation of these properties and the recognition of an environmental remediation liability.
+Added: In coordination with local and federal regulatory agencies, we have conducted testing on certain sites which have resulted in the identification of contamination that has been attributed to historical activities at the properties, resulting in the realization of incremental costs to be assumed by the Company towards the remediation of these properties and the recognition of an environmental remediation liability.
We have not conducted invasive testing at all sites and locations and have identified an environmental remediation liability to the extent such remediation requirements have been identified and are considered estimable.
−Removed: As of July 3, 2022, there was an environmental remediation liability of $ 10.8 million with $ 7.4 million included in Other Current Liabilities and $ 3.4 million included in Other Long-Term Liabilities on the Condensed Consolidated Statements of Financial Position.
−Removed: As of September 30, 2021, there was an environmental remediation liability of $ 11.3 million included in Other Long-Term Liabilities on the Condensed Consolidated Statements of Financial Position.
+Added: As of January 1, 2023, there was an environmental remediation liability of $ 7.5 million with $ 3.6 million included in Other Current Liabilities and $ 3.9 million included in Other Long-Term Liabilities on the Condensed Consolidated Statements of Financial Position.
+Added: As of September 30, 2022, there was an environmental remediation liability of $ 8.8 million with $ 4.7 million included in Other Current Liabilities and $ 4.1 million included in Other Long-Term Liabilities on the Condensed Consolidated Statements of Financial Position.
The Company believes that any additional liability in excess of the amounts provided that may result from resolution of these matters will not have a material adverse effect on the consolidated financial condition, results of operations, or cash flows of the Company.
2 unchanged sentences
The Company has recorded and maintains an estimated liability in the amount of management’s estimate for aggregate exposure for such liabilities based upon probable loss from loss reports, individual cases, and losses incurred but not reported.
−Removed: As of July 3, 2022 and September 30, 2021, the Company recognized $ 3.6 million and $ 3.0 million in product liability, respectively, included in Other Current Liabilities on the Condensed Consolidated Statements of Financial Position.
+Added: As of January 1, 2023 and September 30, 2022, the Company recognized $ 3.1 million and $ 3.4 million in product liability, respectively, included in Other Current Liabilities on the Condensed Consolidated Statements of Financial Position.
The Company believes that any additional liability in excess of the amounts provided that may result from resolution of these matters will not have a material adverse effect on the consolidated financial condition, results of operations or cash flows of the Company.
2 unchanged sentences
Estimated warranty costs incorporate replacement parts, products and delivery, and are recorded as a cost of goods sold at the time of product shipment based on historical and projected warranty claim rates, claims experience and any additional anticipated future costs on previously sold products.
−Removed: The Company recognized $ 0.3 million and $ 0.4 million of warranty accruals as of July 3, 2022 and September 30, 2021, respectively, included in Other Current Liabilities on the Condensed Consolidated Statements of Financial Position.
+Added: The Company recognized $ 0.3 million and $ 0.4 million of warranty accruals as of January 1, 2023 and September 30, 2022, respectively, included in Other Current Liabilities on the Condensed Consolidated Statements of Financial Position.
+Added: Product Safety Recall.
+Added: During the year ended September 30, 2022, the HPC segment initiated voluntary product recalls in collaboration with the U.S.
+Added: Consumer Product Safety Commission (" CPSC"), suspending sales of the affected products and issuing a stop sale with its customers.
+Added: The Company has assessed the incremental costs attributable to the recall, including the anticipated returns from customers for existing retail inventory, write-off of inventory on hand, and other costs to facilitate the recall such as notification, shipping and handling, rework and destruction of affected products, as needed, and evaluated the probability of redemption.
+Added: As a result, the Company recognized $ 8.8 million and $ 7.5 million as of January 1, 2023 and September 30, 2022, respectively, in Other Current Liabilities on the Consolidated Statement of Financial Position associated with the costs for the recalls.
+Added: Additionally, the Company has indemnification provisions that are contractually provided by third parties for the affected products and as a result the Company has also recognized $ 7.4 million and $ 4.7 million as of January 1, 2023 and September 30, 2022, respectively, in Other Receivables on the Consolidated Statement of Financial Position related to recovery from such indemnification provisions.
SPECTRUM BRANDS HOLDINGS, INC.
3 unchanged sentences
NOTE 17 – SEGMENT INFORMATION
−Removed: Net sales relating to the segments for the three and nine month periods ended July 3, 2022 and July 4, 2021 are as follows:
−Removed: Three Month Periods Ended Nine Month Periods Ended
−Removed: (in millions) July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: Net sales relating to the segments for the three month periods ended January 1, 2023 and January 2, 2022, are as follows:
+Added: Three Month Periods Ended
+Added: (in millions) January 1, 2023 January 2, 2022
HPC $ 364.4 $ 379.7
6 unchanged sentences
• Stock based compensation costs consist of costs associated with long-term incentive compensation arrangements that generally consist of non-cash, stock-based compensation.
−Removed: During the nine month period ended July 4, 2021, compensation costs included incentive bridge awards previously issued due to changes in the Company’s LTIP that allowed for cash based payment upon employee election but do not qualify for shared-based compensation, which were fully vested in November 2020.
See Note 13 – Share Based Compensation for further details;
7 unchanged sentences
• 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;
−Removed: • Non-cash gain from the reduction in the contingent consideration liability recognized during the three and nine month periods ended July 3, 2022 associated with the Tristar Business acquisition.
−Removed: See Note 3 - Acquisitions in the Notes to the Condensed Consolidated Financial Statements for further details;
+Added: • Non-cash gain from the reduction in the contingent consideration liability recognized during the three month period ended January 1, 2023 associated with the Tristar Business acquisition in the prior year on February 18, 2022;
• Non-cash asset impairments or write-offs realized and recognized in earnings from continuing operations;
−Removed: • Gains attributable to the Company's investment in Energizer common stock during the nine month period ended July 4, 2021, with such remaining shares sold in January 2021.
−Removed: See Note 12 – Fair Value of Financial Instruments for further details;
−Removed: • Incremental reserves for non-recurring litigation or environmental remediation activity including the proposed settlement on outstanding litigation matters at our H&G division attributable to significant and unusual nonrecurring claims with no previous history or precedent recognized during the nine month period ended July 4, 2021 and the subsequent remeasurement during the nine month period ended July 3, 2022;
−Removed: • Proforma adjustment for operating losses of the Company's in-country Russia operations that were directly attributable to the Company's closing initiatives in Russia and constraints applied to the in-country commercial operations resulting in a substantial decrease to in-country sales and incremental operating losses being realized;
−Removed: • Realized gain from early settlement on certain cash flow hedges in our EMEA region prior to their stated maturity during the three and nine month periods ended July 3, 2022 due to change in the Company's legal entity organizational structure and forecasted purchasing strategy of HPC finished goods inventory within the region.
−Removed: See Note 11- Derivatives in Notes to the Condensed Consolidated Financial Statement for further details;
+Added: • Impact from the early settlement of foreign currency cash flow hedges in the prior year, resulting in subsequent assumed losses at the original stated maturities of foreign currency cash flow hedges in our EMEA region that were settled early in the prior year 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 the recognition of excluded gains in the prior year intended to mitigate costs through the year ending September 30, 2023;
+Added: • Incremental costs recognized by the HPC segment attributable to the realization of product recalls initiated by the Company in the prior year.
+Added: See Note 16 - Commitments and Contingencies for further details;
+Added: • Incremental reserves for non-recurring litigation or environmental remediation activity including the proposed settlement on outstanding litigation matters at our H&G division attributable to significant and unusual nonrecurring claims with no previous history or precedent with remeasurements during the three month period ended January 2, 2022;
• Other adjustments are primarily attributable to:
−Removed: (1) costs associated with Salus as they are not considered a component of the continuing commercial products company and (2) other key executive severance related costs.
+Added: (1) costs associated with Salus as they are not considered a component of the continuing commercial products company;
+Added: (2) key executive severance related costs;
+Added: (3) impairment charges from the exit of certain operating leases at our HPC segment;
+Added: and (4) insurable losses and cost recovery associated with hurricane damages at a key supplier of our Glofish business and loss realized from misapplied funds during the three month period ended January 1, 2023.
SPECTRUM BRANDS HOLDINGS, INC.
3 unchanged sentences
NOTE 17 - SEGMENT INFORMATION (continued)
−Removed: Segment Adjusted EBITDA for the reportable segments for SBH for the three and nine month periods ended July 3, 2022 and July 4, 2021, are as follows:
−Removed: Three Month Periods Ended Nine Month Periods Ended
−Removed: SBH (in millions) July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: Segment Adjusted EBITDA for the reportable segments for SBH for the three month periods ended January 1, 2023 and January 2, 2022, are as follows:
+Added: Three Month Periods Ended
+Added: SBH (in millions) January 1, 2023 January 2, 2022
HPC $ 13.2 $ 27.4
8 unchanged sentences
Tristar acquisition and integration 5.7 1.7
−Removed: Rejuvenate acquisition and integration — 5.8 7.0 5.8
−Removed: Armitage acquisition and integration 0.1 1.0 1.4 7.7
−Removed: Omega integration 0.1 — 1.5 —
−Removed: HHI divestiture 0.6 — 6.1 —
HPC separation initiatives 2.4 1.7
+Added: HHI divestiture 1.5 4.3
Coevorden operations separation 1.3 3.2
+Added: Rejuvenate integration — 4.3
+Added: Armitage integration — 0.7
+Added: Omega integration — 0.9
Fiscal 2022 restructuring 0.6 —
Global ERP transformation 1.6 2.9
−Removed: GPC distribution center transition 8.4 7.7 28.3 7.7
−Removed: Global productivity improvement program 1.2 4.8 5.2 15.7
HPC brand portfolio transitions 1.0 —
Russia closing initiatives 2.9 —
+Added: GPC distribution center transition — 12.8
+Added: Global productivity improvement program — 1.8
Other project costs 3.1 2.1
1 unchanged sentence
Non-cash purchase accounting adjustments 0.5 —
−Removed: Gain from contingent consideration liability ( 25.0 ) — ( 25.0 ) —
−Removed: Gain on Energizer investment — — — ( 6.9 )
+Added: Gain from remeasurement of contingent consideration liability ( 1.5 ) —
+Added: Early settlement of foreign currency cash flow hedges 2.6 —
+Added: HPC product recall 0.3 —
Legal and environmental remediation reserves — ( 0.5 )
−Removed: Proforma in-country Russia operations 0.4 — 0.4 —
−Removed: Gain on early settlement of cash flow hedges ( 8.2 ) — ( 8.2 ) —
Salus and other 4.3 ( 0.1 )
−Removed: Income (loss) from continuing operations before income taxes $ 5.0 $ 8.1 $ ( 73.1 ) $ 14.5
+Added: Loss from continuing operations before income taxes $ ( 52.1 ) $ ( 46.2 )
SPECTRUM BRANDS HOLDINGS, INC.
3 unchanged sentences
NOTE 17 - SEGMENT INFORMATION (continued)
−Removed: Segment Adjusted EBITDA for reportable segments for SB/RH for the three and nine month periods ended July 3, 2022 and July 4, 2021 are as follows:
−Removed: Three Month Periods Ended Nine Month Periods Ended
+Added: Segment Adjusted EBITDA for reportable segments for SB/RH for the three month periods ended January 1, 2023 and January 2, 2022, are as follows:
+Added: Three Month Periods Ended
SB/RH (in millions)
−Removed: July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
+Added: January 1, 2023 January 2, 2022
HPC $ 13.2 $ 27.4
8 unchanged sentences
Tristar acquisition and integration 5.7 1.7
−Removed: Rejuvenate acquisition and integration — 5.8 7.0 5.8
−Removed: Armitage acquisition and integration 0.1 1.0 1.4 7.7
−Removed: Omega integration 0.1 — 1.5 —
−Removed: HHI divestiture 0.6 — 6.1 —
HPC separation initiatives 2.4 1.7
+Added: HHI divestiture 1.5 4.3
Coevorden operations separation 1.3 3.2
+Added: Rejuvenate integration — 4.3
+Added: Armitage integration — 0.7
+Added: Omega integration — 0.9
Fiscal 2022 restructuring 0.6 —
Global ERP transformation 1.6 2.9
−Removed: GPC distribution center transition 8.4 7.7 28.3 7.7
−Removed: Global productivity improvement program 1.2 4.8 5.2 15.7
HPC brand portfolio transitions 1.0 —
Russia in-country closing initiatives 2.9 —
+Added: GPC distribution center transition — 12.8
+Added: Global productivity improvement program — 1.8
Other project costs 3.1 2.1
1 unchanged sentence
Non-cash purchase accounting adjustments 0.5 —
−Removed: Gain from contingent consideration liability ( 25.0 ) — ( 25.0 ) —
−Removed: Gain on Energizer investment — — — ( 6.9 )
+Added: Gain from remeasurement of contingent consideration liability ( 1.5 ) —
+Added: Early settlement of foreign currency cash flow hedges 2.6 —
+Added: HPC product recall 0.3 —
Legal and environmental remediation reserves — ( 0.5 )
−Removed: Proforma in-country Russia operations 0.4 — 0.4 —
−Removed: Gain on early settlement of cash flow hedges ( 8.2 ) — ( 8.2 ) —
Other 4.3 ( 0.2 )
−Removed: Income (loss) from continuing operations before income taxes $ 5.7 $ 9.6 $ ( 71.4 ) $ 17.1
+Added: Loss from continuing operations before income taxes $ ( 52.0 ) $ ( 45.9 )
SPECTRUM BRANDS HOLDINGS, INC.
3 unchanged sentences
NOTE 18 – EARNINGS PER SHARE – SBH
−Removed: The reconciliation of the numerator and denominator of the basic and diluted earnings per share calculation and the anti-dilutive shares for the three and nine month periods ended July 3, 2022 and July 4, 2021 are as follows:
−Removed: Three Month Periods Ended Nine Month Periods Ended
+Added: The reconciliation of the numerator and denominator of the basic and diluted earnings per share calculation and the anti-dilutive shares for the three month periods ended January 1, 2023 and January 2, 2022, are as follows:
+Added: Three Month Periods Ended
(in millions, except per share amounts)
−Removed: July 3, 2022 July 4, 2021 July 3, 2022 July 4, 2021
−Removed: Net income (loss) from continuing operations attributable to controlling interest $ 3.0 $ ( 1.9 ) $ ( 52.3 ) $ 9.1
+Added: January 1, 2023 January 2, 2022
+Added: Net loss from continuing operations attributable to controlling interest $ ( 40.3 ) $ ( 30.2 )
Income from discontinued operations attributable to controlling interest 19.4 38.4
−Removed: Net income attributable to controlling interest $ 32.7 $ 30.7 $ 56.8 $ 139.4
+Added: Net (loss) income attributable to controlling interest $ ( 20.9 ) $ 8.2
Weighted average shares outstanding – basic 40.9 41.3
10 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.