Graco 2007 Annual Report Download - page 78

Newell Rubbermaid Inc. 2007 Annual Report
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Geographic Area Information
2007 2006 2005
Net Sales
U.S. $4,624.3 $4,603.4 $4,338.5
Canada 425.7 387.9 352.2
North America 5,050.0 4,991.3 4,690.7
Europe 879.5 781.0 639.8
Central and South America 250.2 239.3 224.8
Other 227.6 189.4 161.9
$6,407.3 $6,201.0 $5,717.2
Operating Income (2),(5)
U.S. $ 572.4 $ 517.4 $ 434.9
Canada 108.5 78.8 65.8
North America 680.9 596.2 500.7
Europe 10.9 15.4 24.0
Central and South America 11.9 5.3 12.9
Other 36.6 39.7 29.8
$ 740.3 $ 656.6 $ 567.4
Property, Plant and Equipment, Net
U.S. $ 479.5 $ 533.5
Canada 15.7 14.8
North America 495.2 548.3
Europe 121.1 123.7
Central and South America 30.7 31.1
Other 41.6 43.8
$ 688.6 $ 746.9
(1) All intercompany transactions have been eliminated. Sales to Wal-Mart Stores, Inc. and subsidiaries amounted to approximately 13%, 12% and 13% of consolidated net sales for the years
ended December 31, 2007, 2006 and 2005, respectively, substantially across all segments. Sales to no other customer exceeded 10% of consolidated net sales for any year.
(2) Operating income is net sales less cost of products sold and selling, general and administrative expenses. Certain headquarters expenses of an operational nature are allocated to business
segments and geographic areas primarily on a net sales basis.
(3) Capital expenditures associated with discontinued businesses have been excluded. Corporate capital expenditures in 2007 and 2006 are mainly related to the SAP implementation.
(4) Corporate assets primarily include tradenames and goodwill, capitalized software, equity investments and deferred tax assets.
(5) The restructuring and impairment charges have been reflected in the appropriate geographic regions.
FOOTNOTE 19
Litigation and Contingencies
The Company is involved in legal proceedings in the ordinary course of its business. These proceedings include claims for damages arising out of use of
the Company’s products, allegations of infringement of intellectual property, commercial disputes and employment matters as well as environmental
matters described below. Some of the legal proceedings include claims for punitive as well as compensatory damages, and certain proceedings purport
to be class actions.
The Company, using current product sales data and historical trends, actuarially calculates the estimate of its exposure for product liability. As a
result of the most recent analysis, the Company has product liability reserves of $34.4 million as of December 31, 2007. The Company is insured for product
liability claims for amounts in excess of established deductibles and accrues for the estimated liability as described up to the limits of the deductibles.
All other claims and lawsuits are handled on a case-by-case basis.
On July 1, 2007, the Company acquired all of the outstanding equity interest of PSI System, Inc. (“Endicia”), provider of Endicia Internet Postage,
for $51.2 million plus related acquisition costs and contingent payments of up to $25.0 million based on future revenues. Endicia is party to a lawsuit filed
against it alleging patent infringement. In this case, Stamps.com seeks injunctive relief in order to prevent Endicia from continuing to engage in activities
that are alleged to infringe on Stamps.com’s patents. An unfavorable outcome in this litigation, which management does not believe is probable, could
materially adversely affect the Endicia business.