Rayovac 2013 Annual Report Download - page 60

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Segment Adjusted EBITDA improved $3 million to $90 million in Fiscal 2013 compared to segment
Adjusted EBITDA of $87 million in Fiscal 2012 driven by the increase in net sales coupled with cost and
operating expense improvements.
Segment assets at September 30, 2013 decreased to $501 million from $508 million at September 30, 2012.
Goodwill and intangible assets, which are substantially a result of the revaluation impacts of fresh-start reporting
during Fiscal 2009 and acquisitions, decreased to $426 million at September 30, 2013, from $433 million at
September 30, 2012, driven by amortization of intangible assets.
Hardware & Home Improvement
Fiscal Year
2013
Net sales to external customers ........................................................ $ 870
Segment profit ..................................................................... $ 89
Segment profit as a % of net sales ...................................................... 10.2%
Segment Adjusted EBITDA .......................................................... $ 181
Assets as of September 30 ............................................................ $1,736
Results of the HHI Business, reported as a separate business segment, Hardware & Home Improvement
relate to operations subsequent to the acquisition date, December 17, 2012. The results of TLM Taiwan are
reflected in the Hardware & Home Improvement segment subsequent to its acquisition on April 8, 2013.
Segment net sales to external customers were $870 million in Fiscal 2013. Proforma net sales for Fiscal
2013 and Fiscal 2012 as if the acquisition had occurred at the beginning of both periods were $1,062 million and
$974 million, respectively. The Fiscal 2013 sales growth was driven by double-digit improvements in the HHI
Business’ U.S. residential security and plumbing categories due to the housing market recovery.
Segment profit in Fiscal 2013 was $89 million. Segment profitability as a percentage of sales in Fiscal 2013
was 10.2%. Segment profitability was negatively impacted by a $31 million increase to cost of goods sold due to
the sale of inventory which was revalued in connection with the acquisition.
Including pre-acquisition earnings of the HHI Business, segment Adjusted EBITDA was $181 million in
Fiscal 2013.
Segment assets at September 30, 2013 were $1,736 million. Goodwill and intangible assets were
$1,192 million at September 30, 2013.
See Note 15, “Acquisitions” to our Consolidated Financial Statements included in this Annual Report on
Form 10-K for additional information regarding the HHI Business acquisition.
Corporate Expense. Our corporate expense was $62 million in Fiscal 2013 compared to $52 million in
Fiscal 2012. This increase is primarily attributable to a $15 million increase in stock based compensation
expense, tempered by operating expense improvements. Corporate expense as a percentage of consolidated net
sales for Fiscal 2013 decreased slightly to 1.5% versus 1.6% for Fiscal 2012, driven by the operating expense
improvements discussed above and the addition of the HHI Business during Fiscal 2013.
Acquisition and Integration Related Charges. Acquisition and integration related charges include, but are
not limited to, transaction costs such as banking, legal and accounting professional fees directly related to
acquisitions, termination and related costs for transitional and certain other employees, integration related
professional fees and other post business combination related expenses associated with our acquisitions. See
Note 2, “Significant Accounting Policies—Acquisition and Integration Related Charges”, of Notes to
Consolidated Financial Statements included in this Annual Report on Form 10-K for additional information
regarding our Acquisition and integration charges.
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