Rayovac 2012 Annual Report Download - page 69

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increased distribution and product placements with major customers. These gains were partially offset by a
$3 million decrease in lawn and garden control sales due to unseasonable weather conditions in the U.S., which
negatively impacted the lawn and garden season.
Segment profitability in Fiscal 2011 increased to $65 million compared to $51 million in Fiscal 2010. This
increase in segment profitability was attributable to increased sales as well as savings from our global cost
reduction initiatives announced in Fiscal 2009 in addition to the non-recurrence of a $2 million increase in cost of
goods sold that resulted from the sale of inventory that was revalued in connection with our adoption of fresh-
start reporting upon emergence from Chapter 11 of the Bankruptcy Code, that we recognized during the first
quarter of Fiscal 2010. Segment profitability as a percentage of sales in Fiscal 2011 increased to 18.4% from
14.9% in Fiscal 2010. The increase in segment profitability was also due to the factors mentioned above, as well
as margin improvements as a result of expense management. See “Restructuring and Related Charges” below,
as well as Note 14, 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.
Segment Adjusted EBITDA in Fiscal 2011 was $77 million compared to $68 million in Fiscal 2010. The
increase in Adjusted EBITDA during Fiscal 2011 was mainly driven by product distribution gains, cost
improvement initiatives and expense management as mentioned above.
Segment assets as of September 30, 2011 decreased to $476 million from $496 million at September 30,
2010. Goodwill and intangible assets, which are directly a result of the revaluation impacts of fresh-start
reporting and subsequent acquisitions, decreased to $404 million at September 30, 2011 from $413 million at
September 30, 2010. The decrease of $9 million is driven by amortization associated with definite lived
intangible assets of $9 million and an intangible asset impairment of $1 million slightly tempered by additions
due to acquisitions.
Corporate Expense. Our corporate expense in Fiscal 2011 increased to $54 million from $49 million in
Fiscal 2010. This increase is attributable to a $14 million increase in stock based compensation expense during
Fiscal 2011 compared to Fiscal 2010, partially offset by savings resulting from the relocation of the corporate
office back to Madison, Wisconsin, as well as synergies realized from the Merger. Corporate expense as a
percentage of consolidated net sales for Fiscal 2011 was 1.7% compared to 1.9% during Fiscal 2010.
Restructuring and Related Charges. See Note 14, “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.
59