Black & Decker 2013 Annual Report Download - page 49

Download and view the complete annual report

Please find page 49 of the 2013 Black & Decker annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 152

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152


7KH&RPSDQ\KDVH[SRVXUHWRFRPPRGLW\SULFHVLQPDQ\EXVLQHVVHVSDUWLFXODUO\EUDVVQLFNHOUHVLQDOXPLQXPFRSSHU]LQF
VWHHODQGHQHUJ\XVHGLQWKHSURGXFWLRQRIILQLVKHGJRRGV*HQHUDOO\FRPPRGLW\SULFHH[SRVXUHVDUHQRWKHGJHGZLWK
GHULYDWLYHILQDQFLDOLQVWUXPHQWVEXWLQVWHDGDUHDFWLYHO\PDQDJHGWKURXJKFXVWRPHUSURGXFWDQGVHUYLFHSULFLQJDFWLRQV
SURFXUHPHQWGULYHQFRVWUHGXFWLRQLQLWLDWLYHVDQGRWKHUSURGXFWLYLW\LPSURYHPHQWSURMHFWV
2YHUDOOWKH&RPSDQ\H[SHULHQFHGLQIODWLRQRIDSSUR[LPDWHO\PLOOLRQPLOOLRQDQGPLOOLRQLQDQG
UHVSHFWLYHO\3ULFHHURVLRQKDVDOVRRFFXUUHGLQDQGLQDGGLWLRQWRLQIODWLRQZLWKDFXPXODWLYHXQIDYRUDEOH
LPSDFWRIPLOOLRQ7KHLPSDFWRILQIODWLRQLVH[SHFWHGWRFRQWLQXHLQZLWKFRVWDQGSULFLQJDFWLRQVEHLQJ
DJJUHVVLYHO\SXUVXHGWRRIIVHWDQ\DGYHUVHLPSDFWRQRSHUDWLRQV
)OXFWXDWLRQVLQWKHIDLUYDOXHRIWKH&RPSDQ\¶VFRPPRQVWRFNDIIHFWGRPHVWLFUHWLUHPHQWSODQH[SHQVHDVGLVFXVVHGLQWKH
(623VHFWLRQRI0'$$GGLWLRQDOO\WKH&RPSDQ\KDVPLOOLRQRIOLDELOLWLHVDVRI'HFHPEHUSHUWDLQLQJWR
XQIXQGHGGHILQHGFRQWULEXWLRQSODQVIRUFHUWDLQ86HPSOR\HHVIRUZKLFKWKHUHLVPDUNWRPDUNHWH[SRVXUH
7KHDVVHWVKHOGE\WKH&RPSDQ\¶VGHILQHGEHQHILWSODQVDUHH[SRVHGWRIOXFWXDWLRQVLQWKHPDUNHWYDOXHRIVHFXULWLHVSULPDULO\
JOREDOVWRFNVDQGIL[HGLQFRPHVHFXULWLHV7KHIXQGLQJREOLJDWLRQVIRUWKHVHSODQVZRXOGLQFUHDVHLQWKHHYHQWRIDGYHUVH
FKDQJHVLQWKHSODQDVVHWYDOXHVDOWKRXJKVXFKIXQGLQJZRXOGRFFXURYHUDSHULRGRIPDQ\\HDUV,QDQG
WKHUHZHUHPLOOLRQPLOOLRQDQGPLOOLRQUHVSHFWLYHO\LQLQYHVWPHQWUHWXUQVRQSHQVLRQSODQDVVHWV7KH
&RPSDQ\H[SHFWVIXQGLQJREOLJDWLRQVRQLWVGHILQHGEHQHILWSODQVWREHDSSUR[LPDWHO\PLOOLRQLQ7KH&RPSDQ\
HPSOR\VGLYHUVLILHGDVVHWDOORFDWLRQVWRKHOSPLWLJDWHWKLVULVN0DQDJHPHQWKDVZRUNHGWRPLQLPL]HWKLVH[SRVXUHE\IUHH]LQJ
DQGWHUPLQDWLQJGHILQHGEHQHILWSODQVZKHUHDSSURSULDWH
7KH&RPSDQ\KDVDFFHVVWRILQDQFLDOUHVRXUFHVDQGERUURZLQJFDSDELOLWLHVDURXQGWKHZRUOG7KHUHDUHQRLQVWUXPHQWVZLWKLQ
WKHGHEWVWUXFWXUHWKDWZRXOGDFFHOHUDWHSD\PHQWUHTXLUHPHQWVGXHWRDFKDQJHLQFUHGLWUDWLQJ
7KH&RPSDQ\¶VH[LVWLQJFUHGLWIDFLOLWLHVDQGVRXUFHVRIOLTXLGLW\LQFOXGLQJRSHUDWLQJFDVKIORZVDUHFRQVLGHUHGPRUHWKDQ
DGHTXDWHWRFRQGXFWEXVLQHVVDVQRUPDO$FFRUGLQJO\EDVHGRQSUHVHQWFRQGLWLRQVDQGSDVWKLVWRU\PDQDJHPHQWEHOLHYHVLWLV
XQOLNHO\WKDWRSHUDWLRQVZLOOEHPDWHULDOO\DIIHFWHGE\DQ\SRWHQWLDOGHWHULRUDWLRQRIWKHJHQHUDOFUHGLWPDUNHWVWKDWPD\RFFXU
7KH&RPSDQ\EHOLHYHVWKDWLWVVWURQJILQDQFLDOSRVLWLRQRSHUDWLQJFDVKIORZVFRPPLWWHGORQJWHUPFUHGLWIDFLOLWLHVDQG
ERUURZLQJFDSDFLW\DQGUHDG\DFFHVVWRHTXLW\PDUNHWVSURYLGHWKHILQDQFLDOIOH[LELOLW\QHFHVVDU\WRFRQWLQXHLWVUHFRUGRI
DQQXDOGLYLGHQGSD\PHQWVWRLQYHVWLQWKHURXWLQHQHHGVRILWVEXVLQHVVHVWRPDNHVWUDWHJLFDFTXLVLWLRQVDQGWRIXQGRWKHU
LQLWLDWLYHVHQFRPSDVVHGE\LWVJURZWKVWUDWHJ\DQGPDLQWDLQLWVVWURQJLQYHVWPHQWJUDGHFUHGLWUDWLQJV
27+(50$77(56
(PSOR\HH6WRFN2ZQHUVKLS3ODQ$VGHWDLOHGLQ1RWH/(PSOR\HH%HQHILW3ODQVWKH&RPSDQ\KDVDQ(623XQGHUZKLFKWKH
RQJRLQJ86&RUHDQGNGHILQHGFRQWULEXWLRQSODQVDUHIXQGHG2YHUDOO(623H[SHQVHLVDIIHFWHGE\WKHPDUNHWYDOXHRI
WKH&RPSDQ\¶VVWRFNRQWKHPRQWKO\GDWHVZKHQVKDUHVDUHUHOHDVHGDPRQJRWKHUIDFWRUV7KH&RPSDQ\¶VQHW(623DFWLYLW\
UHVXOWHGLQH[SHQVHRIPLOOLRQLQPLOOLRQLQDQGPLOOLRQLQ7KHGHFUHDVHLQQHW(623
H[SHQVHLQLVUHODWHGWRWKHUHOHDVHRIVKDUHVRIXQDOORFDWHGVWRFNWULJJHUHGE\DQDGGLWLRQDOFRQWULEXWLRQWRWKH
(623ZKLFKZDVXVHGE\WKH(623WRPDNHDQDGGLWLRQDOSD\PHQWRQWKHDVVRFLDWHGORDQDVPRUHIXOO\GLVFXVVHGLQ1RWH/
(PSOR\HH%HQHILW3ODQV(623H[SHQVHFRXOGLQFUHDVHLQWKHIXWXUHLIWKHPDUNHWYDOXHRIWKH&RPSDQ\¶VFRPPRQVWRFN
GHFOLQHV
&5,7,&$/$&&2817,1*(67,0$7(6²3UHSDUDWLRQRIWKH&RPSDQ\¶V&RQVROLGDWHG)LQDQFLDO6WDWHPHQWVUHTXLUHV
PDQDJHPHQWWRPDNHHVWLPDWHVDQGDVVXPSWLRQVWKDWDIIHFWWKHUHSRUWHGDPRXQWVRIDVVHWVOLDELOLWLHVUHYHQXHVDQGH[SHQVHV
6LJQLILFDQWDFFRXQWLQJSROLFLHVXVHGLQWKHSUHSDUDWLRQRIWKH&RQVROLGDWHG)LQDQFLDO6WDWHPHQWVDUHGHVFULEHGLQ1RWH$
6LJQLILFDQW$FFRXQWLQJ3ROLFLHV0DQDJHPHQWEHOLHYHVWKHPRVWFRPSOH[DQGVHQVLWLYHMXGJPHQWVEHFDXVHRIWKHLUVLJQLILFDQFH
WRWKH&RQVROLGDWHG)LQDQFLDO6WDWHPHQWVUHVXOWSULPDULO\IURPWKHQHHGWRPDNHHVWLPDWHVDERXWWKHHIIHFWVRIPDWWHUVZLWK
LQKHUHQWXQFHUWDLQW\7KHPRVWVLJQLILFDQWDUHDVLQYROYLQJPDQDJHPHQWHVWLPDWHVDUHGHVFULEHGEHORZ$FWXDOUHVXOWVLQWKHVH
DUHDVFRXOGGLIIHUIURPPDQDJHPHQW¶VHVWLPDWHV
$//2:$1&()25'28%7)8/$&&28176²7KH&RPSDQ\¶VHVWLPDWHIRULWVDOORZDQFHIRUGRXEWIXODFFRXQWVUHODWHGWR
WUDGHUHFHLYDEOHVLVEDVHGRQWZRPHWKRGV7KHDPRXQWVFDOFXODWHGIURPHDFKRIWKHVHPHWKRGVDUHFRPELQHGWRGHWHUPLQHWKH
WRWDODPRXQWUHVHUYHG)LUVWDVSHFLILFUHVHUYHLVHVWDEOLVKHGIRULQGLYLGXDODFFRXQWVZKHUHLQIRUPDWLRQLQGLFDWHVWKHFXVWRPHUV
PD\KDYHDQLQDELOLW\WRPHHWILQDQFLDOREOLJDWLRQV,QWKHVHFDVHVPDQDJHPHQWXVHVLWVMXGJPHQWEDVHGRQWKHVXUURXQGLQJ
IDFWVDQGFLUFXPVWDQFHVWRUHFRUGDVSHFLILFUHVHUYHIRUWKRVHFXVWRPHUVDJDLQVWDPRXQWVGXHWRUHGXFHWKHUHFHLYDEOHWRWKH
DPRXQWH[SHFWHGWREHFROOHFWHG7KHVHVSHFLILFUHVHUYHVDUHUHHYDOXDWHGDQGDGMXVWHGDVDGGLWLRQDOLQIRUPDWLRQLVUHFHLYHG
6HFRQGDUHVHUYHLVGHWHUPLQHGIRUDOOFXVWRPHUVEDVHGRQDUDQJHRISHUFHQWDJHVDSSOLHGWRUHFHLYDEOHDJLQJFDWHJRULHV7KHVH
SHUFHQWDJHVDUHEDVHGRQKLVWRULFDOFROOHFWLRQDQGZULWHRIIH[SHULHQFH