Spectrum Brands(US:SPB)2024-02-08 15:04Financial Performance - Net sales for the three-month period ended December 31, 2023, were $692.2 million, a decrease of 2.5% compared to $713.3 million for the same period in 2022[17]. - Gross profit increased to $244.9 million, representing a gross margin of approximately 35.4%, compared to $201.9 million in the prior year[17]. - Operating income for the quarter was $25.0 million, a significant improvement from an operating loss of $20.2 million in the same period last year[17]. - Net income attributable to controlling interest was $29.1 million, compared to a net loss of $20.9 million in the prior year[17]. - Basic earnings per share from continuing operations was $0.51, a recovery from a loss of $0.99 per share in the same quarter of the previous year[17]. - Comprehensive income for the period was $45.5 million, compared to a loss of $6.0 million in the prior year[20]. - Adjusted EBITDA for the total segments increased to $78.7 million for the three-month period ended December 31, 2023, compared to $48.0 million for the same period in 2022[111]. - Net income from continuing operations attributable to controlling interest was $17.4 million for the three-month period ended December 31, 2023, compared to a loss of $40.3 million in the prior year[114]. Assets and Liabilities - Total assets decreased to $4,846.3 million as of December 31, 2023, down from $5,258.4 million at the end of the previous quarter[16]. - Total liabilities were $2,544.6 million, a reduction from $2,740.1 million in the prior quarter[16]. - Total assets decreased to $4,936.6 million as of December 31, 2023, down from $5,347.3 million at the end of September 2023[29]. - Total liabilities decreased to $2,448.4 million, down from $2,657.6 million in the previous quarter[29]. - Current assets as of December 31, 2023, were reported at $2,382.0 million, down from $2,773.6 million as of September 30, 2023[177]. - Current liabilities decreased to $1,171.1 million as of December 31, 2023, from $1,398.6 million as of September 30, 2023[177]. Cash Flow and Dividends - Cash and cash equivalents decreased to $445.4 million from $753.9 million in the previous quarter[16]. - Cash flows from operating activities from continuing operations generated $18.1 million, a recovery from a cash outflow of $57.0 million in the previous year[27]. - The company reported a net cash used by operating activities of $4.3 million, a notable decrease from $64.2 million in the same period last year[27]. - The company paid $14.1 million in dividends to shareholders during the quarter[27]. - The company paid $246.1 million in cash dividends to the parent during the three-month period ended December 31, 2023, compared to $17.1 million in the same period last year[41]. Debt and Financing - The company reported a gain from debt repurchase of $4.7 million during the quarter[17]. - The total debt of Spectrum Brands, Inc. as of December 31, 2023, was $1,414.5 million, a decrease from $1,573.9 million as of September 30, 2023[69]. - The company repurchased $179.0 million of outstanding Senior Notes during the same period, resulting in a gain of $4.7 million from the debt repurchase[75]. - The company entered into a new credit agreement extending maturity to October 19, 2028, and reduced the capacity of the Revolver Facility to $500.0 million[138]. Segment Performance - The HPC segment reported net sales of $343.3 million, down 7.6% from $364.4 million in the prior year[119]. - Net sales from Black & Decker product sales were $94.1 million, accounting for 13.6% of consolidated net sales for the three-month period ended December 31, 2023, compared to $86.7 million or 12.2% in the prior year[58]. - The Global Pet Care segment reported net sales of $276.9 million, a slight decrease of 0.2% from $277.5 million, with operating income increasing by 93.4% to $43.9 million[151]. - Home & Garden segment net sales increased by 0.8% to $72.0 million, with operating loss improving to $(5.5) million from $(7.2) million[153]. - Home and Personal Care segment net sales decreased by 5.8% to $343.3 million, but operating income improved to $16.5 million from a loss of $(4.3) million[155]. Operational Costs and Expenses - Operating expenses decreased to $219.9 million, down 1.0% from $222.1 million, attributed to improved cost management and reduced initiative spending[145]. - Interest expense significantly decreased by 42.5% to $19.2 million from $33.4 million, due to reduced debt borrowings[145]. - The company incurred $5.1 million in incremental costs related to strategic initiatives during the three-month period ended December 31, 2023, compared to $20.1 million in the same period last year[134]. Other Financial Metrics - The company recognized a $4.0 million impairment on intangible assets during the three-month period ended December 31, 2023, due to a change in brand strategy[65]. - The effective tax rate for SBH increased to 41.6% for the three months ended December 31, 2023, up from 23.3% in the prior year[98]. - The company recognized an environmental remediation liability of $5.3 million as of December 31, 2023, slightly down from $5.4 million as of September 30, 2023[102]. - The company has an estimated product liability of $2.8 million as of December 31, 2023, down from $3.0 million as of September 30, 2023[103].