Sunbeam 2011 Annual Report Download - page 18

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Management’s Discussion and Analysis
Jarden Corporation Annual Report 2011
The Consumer Solutions segment manufactures or sources, markets, and distributes a diverse line of household products, including
kitchen appliances and home environment products. This segment maintains a strong portfolio of globally-recognized brands
including, Bionaire®, Crock-Pot®, FoodSaver®, Health o meter®, Holmes®, Mr. Coffee®, Oster®, Patton®, Rival®, Seal-a-Meal®,
Sunbeam®, skybar® and Villaware®. The principal products in this segment include: clippers and trimmers for professional use in
the beauty and barber and animal categories; electric blankets, mattress pads and throws; household kitchen appliances, such as
blenders, coffeemakers, irons, mixers, slow cookers, toasters, toaster ovens and vacuum packaging machines; home environment
products, such as air purifiers, fans, heaters and humidifiers; products for the hospitality industry; and scales for consumer use.
The Branded Consumables segment manufactures or sources, markets and distributes a broad line of branded consumer products,
many of which are affordable, consumable and fundamental household staples, including arts and crafts paint brushes, brooms,
brushes, buckets, children’s card games, clothespins, collectible tins, condoms, cord, rope and twine, dusters, dust pans, feeding
bottles, fencing, fire extinguishing products, firelogs and firestarters, home canning jars and accessories, kitchen matches, mops,
other craft items, pacifiers, plastic cutlery, playing cards and accessories, rubber gloves and related cleaning products, safes,
security cameras, security doors, smoke and carbon monoxide alarms, soothers, sponges, storage organizers and workshop
accessories, teats, toothpicks, window guards and other accessories. This segment markets our products under the Aviator®,
Ball®, Bee®, Bernardin®, Bicycle®, Billy Boy®, BRK®, Crawford®, Diamond®, Dicon®, Fiona®, First Alert®, First Essentials®,
Hoyle®, Java-Log®, KEM®, Kerr®, Lehigh®, Lillo®, Loew-Cornell®, Mapa®, NUK®, Pine Mountain®, Quickie Green Cleaning®,
Quickie Home-Pro®, Quickie Microban®, Quickie Original®, Quickie Professional®, Spontex®, Tigex® and Wellington® brand
names, among others.
The Process Solutions segment manufactures, markets and distributes a wide variety of plastic products including closures, contact
lens packaging, medical disposables, plastic cutlery and rigid packaging. Many of these products are consumable in nature or
represent components of consumer products. This segment’s materials business produces specialty nylon polymers, conductive
fibers and monofilament used in various products, including woven mats used by paper producers and weed trimmer cutting line, as
well as fiberglass radio antennas for marine, citizen band and military applications. This segment is also the largest North American
producer of niche products fabricated from solid zinc strip and is the sole source supplier of copper-plated zinc penny blanks to the
United States Mint and a major supplier to the Royal Canadian Mint, as well as a supplier of brass, bronze and nickel-plated finishes
on steel and zinc for coinage to other international markets. In addition, the Company manufactures a line of industrial zinc products
marketed globally for use in the architectural, automotive, construction, electrical component and plumbing markets.
Summary of Significant 2011 Activities
• On March 31, 2011, the Company completed a new $1.275 billion senior secured credit facility (the “Facility”). The proceeds
from the Facility and cash on hand were used to extinguish approximately $1.1 billion of debt outstanding, which was
primarily comprised of the principal amount outstanding under the Company’s prior senior secured credit facility. The
weighted average interest rate spread on the Facility decreased by over 60 basis points from the prior senior secured
credit facility.
• In August 2011, the Company’s Board of Directors (the “Board”) authorized a new stock repurchase program for up to $500
million of its common stock.
Acquisitions
Consistent with the Company’s historical acquisition strategy, to the extent the Company pursues future acquisitions, the Company
intends to focus on businesses with product offerings that provide geographic or product diversification, or expansion into related
categories that can be marketed through the Company’s existing distribution channels or provide us with new distribution channels
for its existing products, thereby increasing marketing and distribution efficiencies. Furthermore, the Company expects that
acquisition candidates would demonstrate a combination of attractive margins, strong cash flow characteristics, category leading
positions and products that generate recurring revenue. The Company anticipates that the fragmented nature of the consumer
products market will continue to provide opportunities for growth through strategic acquisitions of complementary businesses.
However, there can be no assurance that the Company will complete an acquisition in any given year or that any such acquisition will
be significant or successful. The Company will only pursue a candidate when it is deemed to be fiscally prudent and that meets the
Company’s acquisition criteria. The Company anticipates that any future acquisitions would be financed through any combination of
cash on hand, operating cash flow, availability under its existing credit facilities and new capital market offerings.
2011 Activity
During 2011, the Company did not complete any significant acquisitions.
2010 Activity
On April 1, 2010, the Company acquired the Mapa Spontex Baby Care and Home Care businesses (“Mapa Spontex”) of Total
S.A. (“Total”), through the acquisition of certain of Total’s subsidiaries for a Euro purchase price of approximately = C200 million
(approximately $275 million), subject to certain adjustments (the “Acquisition”). The total value of the transaction, including debt
assumed and/or repaid, was approximately = C305 million (approximately $415 million). Mapa Spontex is a global manufacturer and