Rayovac 2005 Annual Report Download - page 108

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amount equal to 2% of the participant’s account
value. Each participant vests 20% per year in his
account, with immediate full vesting occurring upon
death, disability or a change in control of the Com-
pany. As of September 30, 2005 and 2004, the
Company had recorded an obligation of $3,329 and
$2,649, respectively, related to the plan.
The Company sponsors a defi ned contribution
pension plan for its domestic salaried employees,
which allows participants to make contributions by
salary reduction pursuant to Section 401(k) of the
Internal Revenue Code. The Company contributes
annually from 3% to 6% of participants’ compensa-
tion based on age or service, and may make addi-
tional discretionary contributions. The Company also
sponsors defi ned contribution pension plans for
employees of certain foreign subsidiaries. Company
contributions charged to operations, including dis-
cretionary amounts, for 2005, 2004 and 2003 were
$4,193, $1,896 and $1,729, respectively.
For measurement purposes, annual rates of
increase of 10.0% in the per capita costs of covered
health care benefi ts were assumed for 2005, 2004
and 2003. The projected annual rates of increase
decline incrementally in future years from 10.0% to
3.5%, 10.0% to 4.0% and 10.0% to 5.25%, respec-
tively, for 2005, 2004 and 2003. The health care
cost trend rate assumption has a moderate effect
on the amounts reported. For example, increasing
the assumed health care cost trend rates by one
percentage point in each year would increase the
accumulated postretirement benefi t obligation as of
September 30, 2005 by $198 and the aggregate of
the service and interest cost components of net
periodic postretirement benefi t cost for the year
ended September 30, 2005 by $51. Decreasing the
assumed health care cost trend rates by one per-
centage point in each year would decrease the
accumulated postretirement benefi t obligation as
of September 30, 2005 by $182 and the aggregate
of the service and interest cost components of net
periodic postretirement benefi t cost for the year
ended September 30, 2005, by $45.
(12) Segment Information
During 2005, the Company managed operations
in fi ve reportable segments, including three based
primarily upon geographic area (North America, Latin
America and Europe/ROW), a fourth (United) based
on its acquisition of United Industries and a fi fth
(Tetra) based on its acquisition of Tetra Holding
GmbH. North America includes the legacy business
(battery, shaving and grooming, personal care and
portable lighting) in the United States and Canada;
Latin America includes the legacy business in
Mexico, Central America, South America and the
Caribbean; Europe/ROW includes the legacy busi-
ness in the United Kingdom, continental Europe,
China, Australia and all other countries in which the
Company conducts business. The United business
segment includes the acquired lawn and garden,
household insect control and United Pet Group busi-
ness in the United States and Canada. The Tetra
business segment includes the acquired global
Tetra business, primarily in Europe, North America
and Japan.
Net sales and Cost of goods sold to other busi-
ness segments have been eliminated. The gross
contribution of intersegment sales is included in
the segment selling the product to the external cus-
tomer. Segment net sales are based upon the
segment from which the product is shipped.
The reportable segment profi ts do not include
interest expense, interest income, and income tax
expense. Also not included in the reportable seg-
ments are corporate expenses including purchasing
expense, corporate general and administrative
expense, certain research and development expense,
and restructuring and related charges. All deprecia-
tion and amortization included in Operating income
is related to reportable segments or corporate.
Costs are identifi ed to reportable segments or cor-
porate, according to the function of each cost center.
All capital expenditures are related to reportable
segments. Variable allocations of assets are not
made for segment reporting.
2005 Form 10-K Annual Report
Spectrum Brands, Inc.
SPECTRUM BRANDS, INC.88