Rayovac 2009 Annual Report Download - page 54

Table of Contents
Index to Financial Statements
from the Ningbo Exit Plan and our global realignment announced in January 2007. See “Restructuring and Related Charges” below, as well as Note 15,
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. Tempering the increase in segment profitability were decreased sales during Fiscal 2009 as compared to
Fiscal 2008 which was primarily driven by unfavorable foreign exchange and softness in certain product categories due to the global economic slowdown.
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 Global Batteries & Personal Care inventory balances of $27 million.
As a result of the inventory revaluation, Global Batteries & Personal Care recognized $10 million in additional cost of goods sold in Fiscal 2009. The
remaining $17 million of the inventory revaluation will be recorded during the first quarter of Fiscal 2010. See “Net Sales” above for further discussion on
our Fiscal 2009 sales.
Segment assets at September 30, 2009 increased to $1,608 million from $1,183 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 additional information related to fresh−start reporting. Partially offsetting this increase in assets was a
non−cash impairment charge of certain intangible assets in Fiscal 2009 of $15 million. See Note 3(i), Significant Accounting Policies and
Practices—Intangible Assets, of Notes to Consolidated Financial Statements included in this Annual Report on Form 10−K for additional information
regarding this impairment charge and the amount attributable to Global Batteries & Personal Care. Goodwill and intangible assets at September 30, 2009
totaled approximately $909 million and are directly a result of the revaluation impacts of fresh−start reporting. Goodwill and intangible assets at
September 30, 2008 total approximately $416 million and primarily relate to the ROV Ltd., VARTA AG, Remington Products Company, L.L.C.
(“Remington Products”) and Microlite S.A. (“Microlite”) acquisitions.
Global Pet Supplies
2009 2008
(in millions)
Net sales to external customers $ 574 $ 599
Segment profit $ 65 $ 69
Segment profit as a % of net sales 11.3% 11.5%
Assets as of September 30, $ 867 $ 700
Segment net sales to external customers in Fiscal 2009 decreased to $574 million from $599 million in Fiscal 2008, representing a decrease of $25
million or 4%. Unfavorable foreign currency exchange translation impacted net sales in Fiscal 2009 compared to Fiscal 2008 by approximately $11 million.
Worldwide aquatic sales for Fiscal 2009 decreased to $360 million when compared to sales of $398 million in Fiscal 2008. The decrease in worldwide
aquatic sales was a result of unfavorable foreign exchange impacts of $11 million coupled with declines of $14 million, $10 million and $3 million in the
United States, Europe and the Pacific Rim. The declines in the U.S. were a result of decreased sales of large equipment, primarily aquariums, due to the
slowdown in economic conditions. The declines in Europe were due to inventory de−stocking at retailers and the poor weather season, which impacted our
outdoor pond product sales, whereas the declines the Pacific Rim were as a result of the slowdown in economic conditions. Companion animal net sales
increased to $214 million in Fiscal 2009 compared to $201 million in Fiscal 2008, an increase of $13 million, or 6%. We continued to see strong growth,
and foresee further growth in Fiscal 2010, in companion animal related product sales in the U.S., driven by our Dingo brand dog treats, coupled with
increased volume in Europe and the Pacific Rim associated with the continued introductions of companion animal products.
Segment profitability in Fiscal 2009 decreased slightly to $65 million from $69 million in Fiscal 2008. Segment profitability as a percentage of sales
in Fiscal 2009 also decreased slightly to 11.3% from 11.5% during
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