Black & Decker 2011 Annual Report Download - page 98

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The Security segment is comprised of the electronic security solutions and the mechanical access solutions businesses. The electronic
security solutions business designs, supplies and installs electronic security systems and provides electronic security services,
including alarm monitoring, video surveillance, fire alarm monitoring, systems integration and system maintenance. Purchasers of
these systems typically contract for ongoing security systems monitoring and maintenance at the time of initial equipment installation.
The electronic security business also sells healthcare solutions which include medical carts and cabinets, asset tracking, infant
protection, pediatric protection, patient protection, wander management, fall management, and emergency call products. The
mechanical access solutions business sells automatic doors, residential and commercial hardware, locking mechanisms, electronic
keyless entry systems, keying systems, tubular and mortise door locksets.
The Industrial segment is comprised of the industrial and automotive repair, engineered fastening and infrastructure businesses. The
industrial and automotive repair business sells hand tools, power tools, and engineered storage solution products. The engineered
fastening business primarily sells engineered fasteners designed for specific applications. The businesses product lines include stud
welding systems, blind rivets and tools, blind inserts and tools, drawn arc weld studs, engineered plastic fasteners, self-piercing
riveting systems and precision nut running systems. The infrastructure business consists of CRC Evans business, and the Company’s
legacy hydraulics business. The business’s product lines include custom pipe handling machinery, joint welding and coating
machinery, weld inspection services and hydraulic tools and accessories.
As discussed in Note E, Merger and Acquisitions, the Company merged with Black & Decker at the close of business on March 12,
2010. The Black & Decker businesses were assessed and integrated into the Company’s existing reportable segments. The legacy
Black & Decker segments, Power Tools and Accessories, Hardware & Home Improvement (“HHI”) and Fastening and Assembly
Systems, were integrated into the Company’s CDIY, Security and Industrial segments, respectively, with the Pfister plumbing
products business which was formerly part of HHI included in the CDIY segment. The results of Black & Decker’s operations are
presented within each of these segments and reflect activity since the merger date.
The Company utilizes segment profit, which is defined as net sales minus cost of sales and SG&A inclusive of the provision for
doubtful accounts (aside from corporate overhead expense), and segment profit as a percentage of net sales to assess the profitability
of each segment. Segment profit excludes the corporate overhead expense element of SG&A, interest income, interest expense, other-
net (inclusive of intangible asset amortization expense), restructuring, and income tax expense. Refer to Note O, Restructuring and
Asset Impairments for the amount of restructuring charges and asset impairments by segment, and to Note F, Goodwill and Intangible
Assets for intangible amortization expense by segment. Corporate overhead is comprised of world headquarters facility expense, cost
for the executive management team and cost for certain centralized functions that benefit the entire Company but are not directly
attributable to the businesses, such as legal and corporate finance functions. Transactions between segments are not material. Segment
assets primarily include accounts receivable, inventory, other current assets, property, plant and equipment, intangible assets and other
miscellaneous assets.
Corporate assets and unallocated assets are cash and deferred income taxes. Geographic net sales and long-lived assets are attributed
to the geographic regions based on the geographic location of each Company subsidiary.