Sunbeam 2007 Annual Report Download - page 16

Campingaz®is a leading global outdoor lifestyle business with comprehensive product offerings in numerous
categories. We believe our ability to serve retailers with a broad array of branded products and introduce new
products will continue to allow us to further penetrate existing customer bases while also attracting new
customers.
Recurring Revenue Stream. We derive recurring and, we believe, non-cyclical annual sales from many of
our leading products due to their affordability and position as fundamental staples within many households. Our
jar closures, firelogs and firestarters, kitchen matches, plastic cutlery, rope, cord and twine and toothpicks are
consumable in nature and exemplify these traits. Moreover, we believe that as the installed base of FoodSaver®
and Seal-a-Meal®appliances increases, our disposable storage bags and related accessories used with the
appliances will constitute an increasing percentage of total food preservation revenues. Historically, the sales of
consumable bags and accessories as a percentage of total net sales of FoodSaver®products has increased.
Additional sources of recurring revenue include replacement blades for our grooming and sheering business,
replacement propane and fuel tanks for our camping business and filters for humidifiers and air purifiers.
Expertise in Successfully Identifying and Executing Complementary Acquisitions. We believe we have
disciplined expertise in identifying and acquiring businesses or brands that complement our existing product
portfolio. We are opportunistic in identifying acquisition candidates that can provide category leading product
offerings to be sold through our existing distribution channels or introduce new distribution channels for our
existing products. This expertise has previously resulted in several important strategic acquisitions of
complementary businesses, including Tilia, Diamond Brands, Lehigh, United States Playing Card Company,
American Household, Inc. (“AHI”), and The Holmes Group, Inc. (“Holmes”), Pure Fishing, Inc. (“Pure Fishing”)
and K2 Inc. (“K2”), which have helped build our portfolio of consumer products and brand names as well as
strengthened our distribution channels. We believe that our acquisition expertise uniquely positions us to take
advantage of future opportunities to acquire complementary businesses or brands.
During 2007, the Company, through Coleman and the Outdoor Solutions segment, initiated the ‘Let’s Go
Outside’ campaign that is focused on getting people outside, having fun and being close to nature. The campaign
is representative of the Company’s dedication to providing active lifestyle products for outdoor and outdoor
related activities. This dedication to these activities was a driving force behind the Company’s acquisitions of K2
and Pure Fishing, Inc. K2 is a leading provider of branded consumer products in the global sports equipment
market that sells fishing equipment, under brand names such as All Star®, JRC™, Penn®, Pflueger®,
Shakespeare®, Ugly Stik®and Xtools®. Baseball, softball, football, basketball and lacrosse products are sold
under brand names such as deBeer®, Gait by deBeer®, Miken®, Rawlings®and Worth®. Alpine and nordic
skiing, snowboarding, snowshoeing and in-line skating products are sold under brand names such as Atlas™,
K2®, Line®, Little Bear®, Madshus®, Marker®, Morrow®, Ride®, Tubbs®, Völkl®and 5150 Snowboards®.
Water sports equipment and personal flotation devices are sold under brand names such as Stearns®, Sevylor®,
Hodgman®and Sospenders®. The Company also sells high performance technical outdoor apparel and
equipment under brand names such as Adio®, Ex Officio®, Marmot®and Planet Earth®. Pure Fishing is a leading
global provider of fishing tackle marketed under well-known fishing brands including Abu-Garcia®, Berkley®,
Fenwick®, Gulp!®, Mitchell®, Stren®and Trilene®.
During 2006, the Company completed four tuck-in acquisitions, three in the Branded Consumables segment
and one in the Consumer Solutions segment. In the third quarter of 2006, one such acquisition the Company
completed was the acquisition of the firelog and firestarter business of Conros Corporation, Conros International
Ltd and Java Logg Global Corporation. The primary brand acquired with this business was Pine Mountain®and
this business has been integrated into our Branded Consumables segment. The other three businesses acquired
were the Canadian and UK-based Dicon®and American Sensor®smoke detector business, a small poker chip
manufacturer and a high end professional hair scissor manufacturer.
Low Cost Manufacturing. We focus on executing manufacturing programs involving large volumes with
superior efficiencies, low cost and high quality. We organize the production runs in many of our business
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