Segment Information

12 Months Ended

Oct. 28, 2011

Segment Information [Abstract]

Segment Information

NOTE 14 – SEGMENT INFORMATION

Based on the nature of our products, technology, manufacturing processes, customers and regulatory environment, we aggregate our operating segments into two reportable segments: Coatings and Paints. We are required to report segment information in the same way that management internally organizes its business for assessing performance and making decisions regarding allocation of resources. We evaluate the performance of operating segments and allocate resources based on profit or loss from operations before interest expense and taxes (EBIT).

The Coatings segment aggregates our industrial and packaging product lines. Industrial products include a broad range of decorative and protective coatings for metal, wood and plastic. Packaging products include both interior and exterior coatings used in metal packaging containers, principally food containers and beverage cans. The products of this segment are sold throughout the world.

The Paints segment aggregates our consumer paints and automotive refinish product lines. Consumer paint products include interior and exterior decorative paints, primers, varnishes, high performance floor paints and specialty decorative products, such as enamels, aerosols and faux varnishes for the do-it-yourself and professional markets in North America and China. In September 2010, we acquired Wattyl Limited and we now sell consumer paints in Australia and New Zealand primarily through independent dealers, hardware chains, home centers and company-owned stores (see Note 2).

Our remaining activities are included in All Other. These activities include specialty polymers and colorants that are used internally and sold to other coatings manufacturers, as well as gelcoats and related products and furniture protection plans. Also included within All Other are our corporate administrative expenses. The administrative expenses include amortization expense, certain environmental-related expenses and other expenses not directly allocated to any other operating segment.

It is not practicable to obtain the information needed to disclose revenues attributable to each of our identified product lines within our reportable segments.

In the following table, sales between segments are recorded at selling prices that are below market prices, generally intended to recover internal costs. Segment EBIT includes income realized on inter-segment sales. Identifiable assets are those directly identified with each reportable segment. Corporate assets included within All Other include cash and cash equivalents, deferred pension assets, intangibles and the headquarters property, plant and equipment. The accounting policies of the reportable segments are the same as those described in Note 1. Comparative segment data for fiscal years 2011, 2010 and 2009 are as follows:

	2011			2010			2009
Net Sales:
Coatings	$	2,092,490		$	1,814,804		$	1,582,786
Paints		1,612,219			1,176,831			1,072,372
All Other		360,059			335,354			316,251
Less Intersegment sales		(111,814	)		(100,302	)		(92,367	)
Total Net Sales	$	3,952,954		$	3,226,687		$	2,879,042

	2011			2010			2009
EBIT:
Coatings	$	(112,209	)	$	256,466		$	185,528
Paints		134,886			151,432			135,561
All Other		(64,320	)		(30,434	)		(32,367	)
Total EBIT	$	(41,643	)	$	377,464		$	288,722
Interest Expense	$	61,511		$	58,267		$	50,394
Income (Loss) before Income Taxes	$	(103,154	)	$	319,197		$	238,328

	2011		2010		2009
Depreciation and Amortization:
Coatings	$	47,205	$	45,006	$	45,439
Paints		34,202		18,686		18,566
All Other		16,340		17,620		18,857
Total Depreciation and Amortization	$	97,747	$	81,312	$	82,862

	2011		2010		2009
Identifiable Assets:
Coatings	$	2,118,589	$	2,368,262	$	2,293,130
Paints		1,030,712		1,117,485		818,732
All Other 1		350,850		382,189		399,162
Total Identifiable Assets	$	3,500,151	$	3,867,936	$	3,511,024

¹

Includes our consolidated cash and cash equivalent balances and restricted cash.

 

	2011		2010		2009
Capital Expenditures:
Coatings	$	32,284	$	30,355	$	25,761
Paints		18,650		16,644		8,047
All Other		15,535		20,733		24,089
Total Capital Expenditures	$	66,469	$	67,732	$	57,897

Geographic net sales are based on the country from which the customer was billed for the products sold. The United States is the largest country for customer sales. China and Australia are the only countries outside of the United States that represent more than 10% of consolidated sales. Long-lived assets include property, plant and equipment, intangibles and goodwill attributable to each country's operations. Net sales and long-lived assets by geographic region are as follows:

	2011		2010		2009
Net Sales – External:
United States	$	2,055,494	$	1,922,781	$	1,790,084
China		488,272		418,017		328,634
Australia		481,578		103,042		71,026
Other Countries		927,610		782,847		689,298
Total Net Sales - External	$	3,952,954	$	3,226,687	$	2,879,042
	2011		2010		2009
Long-lived Assets:
United States	$	1,186,267	$	1,498,192	$	1,513,885
China		366,417		465,505		459,004
Australia		144,316		153,571		35,622
Other Countries		462,545		443,570		430,497
Total Long-lived Assets	$	2,159,545	$	2,560,838	$	2,439,008

We have one significant customer in the Paints segment whose net sales ranged from 16.4% to 20.1% of total sales over the last three years.