Spectrum Brands(SPB) - 2025 Q4 - Annual Results

Financial Performance - Fourth quarter net sales decreased by 5.2% to $733.5 million, with organic net sales down 6.6%[4] - Full year net income from continuing operations was $100.2 million, with adjusted EBITDA of $289.1 million[4] - Global Pet Care (GPC) segment net sales decreased by 1.5% to $298.1 million, while adjusted EBITDA increased by 12.0% to $49.6 million[6] - Home & Garden (H&G) segment net sales increased by 3.2% to $139.2 million, but adjusted EBITDA decreased by 11.1% to $16.9 million[8] - Home and Personal Care (HPC) segment net sales decreased by 11.9% to $296.2 million, with adjusted EBITDA declining by 17.4% to $15.7 million[11] - Net sales for the three-month period ended September 30, 2025, were $733.5 million, a decrease of 5.2% compared to $773.7 million for the same period in 2024[38] - Gross profit for the year ended September 30, 2025, was $1,031.9 million, down from $1,109.3 million in 2024, reflecting a decline of 7.0%[38] - Operating income for the three-month period increased to $29.4 million, compared to $21.9 million in the same period last year, representing a growth of 34.1%[38] - Net income attributable to controlling interest for the three-month period was $55.6 million, up from $28.6 million in 2024, marking an increase of 94.1%[38] - Basic earnings per share from continuing operations rose to $2.21 for the three-month period, compared to $0.45 in the prior year, reflecting a significant increase of 391.1%[38] - Adjusted EBITDA for the year ended September 30, 2025, was $289.1 million, compared to $371.8 million in 2024, reflecting a decrease in adjusted EBITDA margin from 12.5% to 10.3%[42] - Diluted EPS from continuing operations for the three months ended September 30, 2025, was $2.19, up from $0.45 in the same period of 2024, with adjusted diluted EPS increasing to $2.61 from $0.97[44] Cash Flow and Liquidity - Adjusted free cash flow for fiscal 2025 was $170.7 million, exceeding the target of $160 million by $10 million[4] - As of the end of the quarter, the company had a cash balance of $123.6 million and total liquidity of $615.9 million[13] - Cash provided by operating activities from continuing operations was $204.1 million for the year, down from $269.8 million in 2024, a decrease of 24.3%[34] - The company reported a net cash used by financing activities of $401.2 million in 2025, compared to $1,578.2 million in 2024, indicating a significant reduction in cash outflow[34] - Net cash provided by operating activities from continuing operations for the year ended September 30, 2025, was $204.1 million, down from $269.8 million in 2024[50] - Adjusted free cash flow for the year ended September 30, 2025, was $170.7 million, slightly down from $176.6 million in 2024[50] Future Outlook - For fiscal 2026, the company expects flat to low single-digit net sales growth and low single-digit adjusted EBITDA growth[4] - Forward-looking statements include expectations regarding M&A strategy, future free cash flows, and operational conditions, reflecting management's outlook[26] - The company will not update forward-looking statements unless required by law, indicating a commitment to transparency in reporting[30] Risks and Challenges - Risks include economic conditions, geopolitical factors, and reliance on third-party partners, which could materially affect actual results[27] - The company faces challenges from tariffs, supply chain disruptions, and competitive pressures that may impact financial performance[28] Shareholder Returns - The company returned $374.6 million to shareholders through share repurchases and dividends in fiscal 2025[4] Non-GAAP Measures - Adjusted EBITDA excludes non-cash adjustments and is calculated as a percentage of reported net sales, providing insight into the company's operational performance[21] - Adjusted EPS is used to analyze financial performance by excluding non-comparable items, enhancing understanding of the company's results and strategic initiatives[22] - Adjusted Free Cash Flow is a key measure for evaluating cash flow generation from operations, excluding strategic transaction costs and non-recurring events[23] - Cash flow conversion is defined as adjusted free cash flow as a percentage of adjusted EBITDA, indicating the efficiency of cash flow generation[24] - The company emphasizes the importance of non-GAAP measurements to provide supplemental information alongside GAAP results for better investor understanding[25] Environmental and Social Governance (ESG) - Management aims to achieve goals related to greenhouse gas emissions reduction and other ESG matters, which are critical for stakeholder expectations[29]