Graco 2014 Annual Report Download - page 5

Newell Rubbermaid 5 2014 Annual Report
We also acquired Baby Jogger, a leading designer
and marketer of premium baby strollers. The Baby
Jogger® brand and City Mini®, City Select® and other
sub-brands are the perfect premium complement to
our industry-leading Graco® brand, providing a great
opportunity for Newell Rubbermaid to participate
more fully in this fast-growing segment of the market.
With sales in more than 70 countries, Baby Jogger
will also help scale the Baby segment’s geographic
footprint outside North America.
We exited approximately $25 million of non-strategic
sales in our EMEA region, simplifying our operations
for increased profitability and focusing our resources
for growth on the most attractive country-category
combinations. As a result, our 2014 normalized
operating margins in EMEA increased 580 basis
points versus last year to 14.7 percent, equal to our
normalized margins in North America.
In our Home Solutions segment, we have made
tough choices to reposition the Rubbermaid
Consumer business for profitable growth by pulling
back on certain low-margin product lines. And we
announced our intentions to exit our Calphalon®
Kitchen Electrics and outlet stores and the Endicia®
online postage business.
MORE OPPORTUNITY
AHEAD THAN BEHIND
The progress we have made so far as we successfully
drive the Growth Game Plan into action has created
significant value for our shareholders. Our consistently
strong cash flow has enabled us to reward shareholders
with a return of capital through share repurchases
and steady dividend increases.
In 2014, we allocated $546 million to share repurchases
and dividend payments. We also announced the
Board of Directors’ decision to increase and extend
our ongoing open market share repurchase
authorization by an additional $500 million through
2017. Most recently, in February 2015, we increased
our quarterly dividend 12 percent to $0.19 per share,
the fifth dividend increase in the last four years.
While we are proud of our achievements, we are
even more excited by what lies ahead. We are still
only in the second phase of the Growth Game Plan,
and there is much more opportunity in front of us
than we have realized to date.
Looking ahead to 2015 and beyond, we will continue
to tackle unnecessary complexity in our business,
reduce our overhead structure and drive productivity
across the portfolio. Our clear line of sight to these
additional cost savings bolsters our commitment to
step up brand support significantly again in 2015,
with further increases to come in subsequent years.
We have considerable runway to expand our
business internationally, leveraging the success
of our Win Bigger businesses in Latin America
to build repeatable models that we can replicate
across the globe. And we will continue to make
even sharper choices as we strengthen, focus and
scale our portfolio. This will help us reach our goal
of consistently delivering greater than 4 percent
core sales growth and more than 10 percent
normalized earnings per share growth when we
enter the Acceleration phase in 2016.
In a few short years, Newell Rubbermaid has become
a faster-growing and leaner business, investing in our
brands at record levels and winning in the marketplace
in the U.S. and overseas. This transformation has
only been possible thanks to the continued support
of our shareholders.
On behalf of my colleagues at Newell Rubbermaid,
thank you.
Michael B. Polk
President and Chief Executive Ocer
* Please refer to page 18 for information regarding forward-looking
statements and page 20 for information regarding the use of
non-GAAP financial measures.