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76 Jarden Corporation Annual Report 2012
For the years ended December 31,
2012 2011 Inc/(Dec)
GROSS MARGIN (%)
Gross margin as reported 28.7% 27.8% 0.9%
Fair market value adjustment to inventory 0.1% 0.1% —
Rationalization of international manufacturing facilities 0.2% 0.4% (0.2)%
Adjusted gross margin 29.0% 28.3% 0.7%
Reconciliation of GAAP to Non-GAAP Measures
Jarden Corporation Annual Report 2012
Reconciliation of non-GAAP Measures:
For the Years Ended December 31,
(In millions) 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Net income (loss) $ 31.8 $ 42.4 $ 60.7 $ 106.0 $ 28.1 $ (58.9) $ 128.7 $ 106.7 $ 204.7 $ 243.9
Income tax provision 20.5 26.0 35.0 82.0 38.5 26.3 110.7 122.8 125.7 147.6
Interest expense, net 19.2 27.6 84.2 112.6 149.7 178.7 147.5 177.8 179.7 185.3
Loss on early extinguishment of debt — — 6.1 — 15.7 — — — 12.8 —
Operating earnings 71.5 96.0 186.0 300.6 232.0 146.1 386.9 407.3 522.9 576.8
Adjustments to reconcile to Segment Earnings:
Depreciation and amortization 15.0 19.2 57.6 66.4 96.4 120.3 130.3 142.8 163.7 152.8
Fair value adjustment to inventory — — 22.4 10.4 118.9 — — 27.4 6.9 6.0
Venezuela hyperinflationary and devaluation
charges — — — — — — — 70.6 — —
Reorganization costs, net — — 29.1 36.8 49.6 59.8 48.5 — 23.4 27.1
Acquisition-related and other costs, net — — — — 4.6 — — 42.3 21.4 17.5
Impairment of goodwill, intangibles and other
assets — — — — — 283.2 22.9 19.7 52.5 —
Cumulative adjustment of stock compensation — — — — — — — — — 33.6
Other adjustments — — 2.5 4.8 — — 17.1 — — —
Segment Earnings $ 86.5 $ 115.2 $ 297.6 $ 419.0 $ 501.5 $ 609.4 $ 605.7 $ 710.1 $ 790.8 $ 813.8
Segment Earnings represents earnings before interest, taxes and depreciation and amortization, excluding certain reorganization
costs, net, acquisition-related and other costs, net, impairment of goodwill, intangible assets and other assets, non-cash Venezuela
hyperinflationary and devaluation charges, fair value inventory adjustments and other items. This non-GAAP financial measure is
presented in this Annual Report because it is a basis upon which the Company’s management has assessed its financial performance in
the years presented. Additionally, the Company uses non-GAAP financial measures because the Company’s credit agreement provides
for certain adjustments in calculations used for determining whether the Company is in compliance with certain credit agreement
covenants, including, but not limited to, adjustments relating to non-cash purchase accounting adjustments, certain reorganization and
acquisition-related integration costs, impairment of goodwill and intangible assets, non-cash stock-based compensation costs and loss
on early extinguishment of debt. Segment Earnings should not be considered a primary measure of the Company’s performance and
should be reviewed in conjunction with, and not as substitute for, financial measurements prepared in accordance with GAAP that are
presented in this Annual Report. A reconciliation of the calculation of Segment Earnings is presented below: