Rayovac 2011 Annual Report Download - page 48

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(2) Fiscal 2007 loss from discontinued operations, net of tax, includes a non-cash pretax impairment charge of
approximately $45 million to reduce the carrying value of certain assets, principally consisting of goodwill
and intangible assets, relating to the Canadian Division of our Home and Garden Business in order to reflect
the estimated fair value of this business. Fiscal 2008 loss from discontinued operations, net of tax, includes a
non-cash pretax impairment charge of approximately $8 million to reduce the carrying value of intangible
assets relating to the growing products portion of our Home and Garden Business in order to reflect the
estimated fair value of this business.
(3) Fiscal 2011 income tax expense of $92 million includes a non-cash charge of approximately $65 million
resulting from an increase in the valuation allowance against certain net deferred tax assets.
(4) Fiscal 2010 income tax expense of $63 million includes a non-cash charge of approximately $92 million
resulting from an increase in the valuation allowance against certain net deferred tax assets.
(5) Included in the period from August 31, 2009 through September 30, 2009 for the Successor Company is a
non-cash tax charge of $58 million related to the residual U.S. and foreign taxes on approximately $166
million of actual and deemed distributions of foreign earnings. Income tax expense for the Predecessor
Company for the period from October 1, 2008 through August 30, 2009 includes a non-cash adjustment of
approximately $52 million resulting from a reduction in the valuation allowance against certain deferred tax
assets. Included in income tax expense for the period from October 1, 2008 through August 30, 2009 for the
Predecessor Company is a non-cash charge of $104 million related to the tax effects of the fresh start
adjustments. In addition, income tax expense for the Predecessor Company for this period includes the tax
effect of the gain on the cancellation of debt from the extinguishment of the senior subordinated notes as
well as the modification of the senior term credit facility. The tax effect of these gains increased the
Company’s U.S. net deferred tax asset exclusive of indefinite lived intangibles by approximately $124
million. However, due to the Company’s full valuation allowance on the U.S. net deferred tax asset
exclusive of indefinite lived intangibles as of August 30, 2009, the tax effect of the gain on the cancellation
of debt and the modification of the senior secured credit facility was offset by a corresponding adjustment to
increase the valuation allowance for deferred tax assets by$124 million. The tax effect of the fresh start
adjustments, the gain on the cancellation of debt and the modification of the senior secured credit facility,
net of corresponding adjustments to the valuation allowance, are netted against reorganization items.
(6) Fiscal 2008 income tax benefit of $10 million includes a non-cash charge of approximately $222 million
resulting from an increase in the valuation allowance against certain net deferred tax assets.
(7) Fiscal 2007 income tax expense of $56 million includes a non-cash charge of approximately $180 million
resulting from an increase in the valuation allowance against certain net deferred tax assets.
(8) See Note 14, Restructuring and Related Charges, of Notes to Consolidated Financial Statements included in
this Annual Report on Form 10-K for further discussion.
(9) Diluted average shares outstanding for each of Fiscal 2011, Fiscal 2010, the period from August 31, 2009
through September 30, 2009, the period from October 1, 2008 through August 30, 2009, Fiscal 2008 and
Fiscal 2007 does not assume the exercise of common stock equivalents as the impact would be antidilutive.
(10) Amounts reflect the results of continuing operations only.
(11) Working capital is defined as current assets less current liabilities.
(12) Fiscal 2011 includes a non-cash charge of $24 million related to the write-off of unamortized debt issuance
costs and unamortized discounts in conjunction with the refinancing of the Company’s Term Debt facility.
Fiscal 2010 includes a non-cash charge of $83 million related to the write-off of unamortized debt issuance
costs and unamortized discounts and premiums related to the extinguishment and refinancing of debt that
was completed in conjunction with the Merger.
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