Rayovac 2011 Annual Report Download - page 3

Spectrum Brands delivered increased fi scal 2011
results and, as we did in fi scal 2010, we met or sur-
passed our fi nancial targets for the year. Net sales
from conƟ nuing operaƟ ons increased 2.4 percent
and adjusted EBITDA grew a solid 6 percent for fi scal
2011, while we signifi cantly exceeded our $155-$165
million free cash fl ow target with $191 million for the
year or almost $4 of free cash fl ow per share. This
is a reinforcement of the free cash fl ow generaƟ on
strength our Company provides shareholders.
We ended 2011 in a strong liquidity posiƟ on, with
$142 million of cash, and surpassed our aggressive
debt reducƟ on target with $225 million of Term Loan
debt paydown to reduce our leverage raƟ o to a year-
end level of 3.4 Ɵ mes, below our goal of 3.5 Ɵ mes.
Just a liƩ le more than two years ago our leverage ra-
Ɵ o was about 5 Ɵ mes. This
is steady and measurable
value creaƟ on. The rapid
integraƟ on of our Russell
Hobbs acquisiƟ on conƟ n-
ues, leading us to recently
increase our cost synergies
target for that acquisiƟ on once again, as well as for
our Global Pet Supplies restructuring acƟ viƟ es.
Your Board and senior management team remain con-
fi dent and opƟ misƟ c about the outlook for Spectrum
Brands. We are now a $3.2 billion, global consumer
products company with a broad oī ering of widely
trusted, extendable and like brands for like retailers
that provide quality, performance and value every day to
consumers worldwide.
In short, we believe Spectrum Brands’ Ɵ me has come. With
distribuƟ on gains in our business segments, major new
retailer placements, and the pipeline of new products and
line extensions we have in place, we are generally outper-
forming our categories and compeƟ tors around the world,
demonstraƟ ng that our Spectrum Value Model is working.
We believe our Spectrum Value Model is a game changer.
This retail customer strategy is ideal for largely everyday,
non-discreƟ onary, replacement consumer products, par-
Ɵ cularly in this challenging environment of sluggish retail
acƟ vity, infl aƟ onary pressure, and rising commodity and
Asian supply chain costs. Our recent selecƟ on as one of
two mulƟ -year, branded baƩ ery suppliers to Carrefour,
the world’s second largest retailer, is an excellent example.
We conƟ nue to generally out-
perform our compeƟƟ on and
categories around the world
because our Spectrum Value
Model resonates with retailers
and consumers. It delivers genu-
ine value to the consumer with
products that work as well as, or beƩ er than, our com-
peƟ tors for a lower cost. It also provides higher margins
and lower acquisiƟ on costs to our retail customers, along
with excellent category management. Our eī orts are con-
centrated on winning at point of sale and on creaƟ ng and
maintaining a low-cost, eĸ cient operaƟ ng structure that
allows our top-line growth to contribute directly to our
David R. Lumley
Chief ExecuƟ ve Oĸ cer
VISION
Be The Leader in Retailer Metrics with Superior
Value Consumer Products for Everyday Use
GOAL
Create Shareholder Value Through a CombinaƟ on of
Adjusted EBITDA Growth and Debt ReducƟ on
TO OUR SHAREHOLDERS
Spectrum Brands Holdings is a company on the move. We are building a strong plaƞ orm
for sustained growth and value creaƟ on with momentum from higher fi scal 2011 results,
including a solid fourth quarter, and expectaƟ ons for an even beƩ er fi scal 2012.