Rayovac 2010 Annual Report Download - page 126

SPECTRUM BRANDS HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(In thousands, except per share amounts)
As of September 30, 2010 and September 30, 2009, foreign currency translation adjustment balances of
$18,492 and $5,896, respectively, were reflected in the accompanying Consolidated Statements of Financial
Position in AOCI.
Successor Company exchange losses (gains) on foreign currency transactions aggregating $13,336 and
$(726) for Fiscal 2010 and the period from August 31, 2009 through September 30, 2009, respectively, are
included in Other expense (income), net, in the accompanying Consolidated Statements of Operations.
Predecessor Company exchange losses (gains) on foreign currency transactions aggregating $4,440 and $3,466
for the period from October 1, 2008 through August 30, 2009 and Fiscal 2008, respectively, are included in Other
expense (income), net, in the accompanying Consolidated Statements of Operations.
(n) Shipping and Handling Costs
The Successor Company incurred shipping and handling costs of $161,148 and $12,866 during Fiscal 2010 and
the period from August 31, 2009 through September 30, 2009, respectively. The Predecessor Company incurred
shipping and handling costs of $135,511 and $183,676 during the period from October 1, 2008 through
August 30, 2009 and Fiscal 2008, respectively. Shipping and handling costs, which are included in Selling
expenses in the accompanying Consolidated Statements of Operations, include costs incurred with third-party
carriers to transport products to customers and salaries and overhead costs related to activities to prepare the
Company’s products for shipment at the Company’s distribution facilities.
(o) Advertising Costs
The Successor Company incurred advertising costs of $37,520 and $3,166 during Fiscal 2010 and the period
from August 31, 2009 through September 30, 2009, respectively. The Predecessor Company incurred expenses
for advertising of $25,813 and $46,417during the period from October 1, 2008 through August 30, 2009 and
Fiscal 2008, respectively. Such advertising costs are included in Selling expenses in the accompanying
Consolidated Statements of Operations.
(p) Research and Development Costs
Research and development costs are charged to expense in the period they are incurred.
(q) Net (Loss) Income Per Common Share
Basic net (loss) income per common share is computed by dividing net (loss) income available to common
shareholders by the weighted-average number of common shares outstanding for the period. Basic net (loss)
income per common share does not consider common stock equivalents. Diluted net (loss) income per common
share reflects the dilution that would occur if employee stock options and restricted stock awards were exercised
or converted into common shares or resulted in the issuance of common shares that then shared in the net (loss)
income of the entity. The computation of diluted net (loss) income per common share uses the “if converted” and
“treasury stock” methods to reflect dilution. The difference between the basic and diluted number of shares is due
to the effects of restricted stock and assumed conversion of employee stock options awards.
As discussed in Note 2, Voluntary Reorganization under Chapter 11, the Predecessor Company common
stock was cancelled as a result of the Company’s emergence from Chapter 11 of the Bankruptcy Code on the
Effective Date. The Successor Company common stock began trading on September 2, 2009. As such, the
earnings per share information for the Predecessor Company is not meaningful to shareholders of the Successor
Company’s common shares, or to potential investors in such common shares.
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