Rayovac 2010 Annual Report Download - page 78

profitable products. This decrease in sales within lawn and garden control products were partially offset by
increased sales of household insect control products, driven by increased sales to a major customer.
Segment profitability in Fiscal 2009 increased to $42 million from $29 million in Fiscal 2008. Segment
profitability as a percentage of sales in Fiscal 2009 increased to 13.0% from 8.7% in Fiscal 2008. The increase in
segment profit for Fiscal 2009 was the result of declining commodity costs associated with our lawn and garden
control products and the non-recurrence of a charge incurred during Fiscal 2008 of approximately $11 million
that related to depreciation and amortization expense related to Fiscal 2007. From October 1, 2006 through
December 30, 2007, the Home and Garden Business was designated as discontinued operations. In accordance
with generally excepted accounting principles, while designated as discontinued operations we ceased recording
depreciation and amortization expense associated with the assets of this business. As a result of our
reclassification of that business to a continuing operation we recorded a catch-up of depreciation and
amortization expense, which totaled $14 million, for the five quarters during which this business was designated
as discontinued operations. In addition, as a result of our adoption of fresh-start reporting upon emergence from
Chapter 11 of the Bankruptcy Code, in accordance with SFAS 141, inventory balances were revalued as of
August 30, 2009 resulting in an increase in such Home and Garden inventory balances of $3 million. As a result
of the inventory revaluation, Home and Garden recognized $1 million in additional cost of goods sold in Fiscal
2009. The remaining $2 million of the inventory revaluation was recorded during the first quarter of Fiscal 2010.
Segment assets as of September 30, 2009 increased to $504 million from $290 million at September 30,
2008. The increase is primarily a result of the revaluation impacts of fresh-start reporting. See Note 2, Voluntary
Reorganization Under Chapter 11, of Notes to Consolidated Financial Statements included in this Annual Report
on Form 10-K for more information related to fresh-start reporting. Goodwill and intangible assets as of
September 30, 2009 total approximately $419 million and are directly a result of the revaluation impacts of fresh-
start reporting. Intangible assets as of September 30, 2008 total approximately $115 million and primarily relate
to the acquisition of the United Industries division of United.
Corporate Expense. Our corporate expense in Fiscal 2009 decreased to $34 million from $45 million in
Fiscal 2008. Our corporate expense as a percentage of consolidated net sales in Fiscal 2009 decreased to 1.5%
from 1.9%. The decrease in expense is partially a result of the non-recurrence of a $9 million charge incurred in
Fiscal 2008 to write off professional fees incurred in connection with the termination of substantive negotiations
with a potential purchaser of our Global Pet Supplies business.
Restructuring and Related Charges. See Note 14, Restructuring and Related Charges of Notes to
Consolidated Financial Statements, included in this Annual Report on Form 10-K for additional information
regarding our restructuring and related charges.
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