Guarantor Statements - SB/RH

9 Months Ended

Jun. 30, 2019

Guarantor Statements - SB/RH [Abstract]

NOTE 21 - GUARANTOR STATEMENTS – SB/RH

SBI with SB/RH as a parent guarantor (collectively, the “Parent”), with SBI’s domestic subsidiaries as subsidiary guarantors, has issued the 6.625% Notes under the 2020/22 Indenture, 6.125% Notes under the 2024 Indenture, the 5.75% Notes under the 2025 Indenture and the 4.00% Notes under the 2026 Indenture.

The following consolidating financial statements illustrate the components of the consolidated financial statements of SB/RH. The ‘Parent’ consists of the financial statements of SBI as the debt issuer, with SB/RH as a parent guarantor, without consolidated entities. SB/RH financial information is not presented separately as there are no independent assets or operations and is therefore determined not to be material. Investments in subsidiaries are accounted for using the equity method for purposes of illustrating the consolidating presentation. The elimination entries presented herein eliminate investments in subsidiaries and intercompany balances and transactions.



Statement of Financial Position			Guarantor		Nonguarantor
As of June 30, 2019 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Assets
Cash and cash equivalents	$	3.2	$	0.5	$	152.5	$	—	$	156.2
Trade receivables, net		232.3		167.8		168.4		—		568.5
Intercompany receivables		—		1,813.9		1,108.8		(2,922.7)		—
Other receivables		68.3		5.6		54.6		—		128.5
Inventories		270.8		214.9		244.9		(12.0)		718.6
Prepaid expenses and other		27.8		6.5		26.1		—		60.4
Current assets of business held for sale		—		—		—		—		—
Total current assets		602.4		2,209.2		1,755.3		(2,934.7)		1,632.2
Property, plant and equipment, net		188.1		120.7		156.1		—		464.9
Long-term intercompany receivables		82.1		60.5		10.8		(153.4)		—
Deferred charges and other		222.4		(101.0)		68.8		(155.2)		35.0
Investment		204.7		—		—		—		204.7
Goodwill		629.9		544.2		276.9		—		1,451.0
Intangible assets, net		732.6		585.1		249.8		—		1,567.5
Investments in subsidiaries		4,327.8		1,625.3		(2.9)		(5,950.2)		—
Total assets	$	6,990.0	$	5,044.0	$	2,514.8	$	(9,193.5)	$	5,355.3
Liabilities and Shareholder's Equity
Current portion of long-term debt	$	2.2	$	4.6	$	7.2	$	(0.2)	$	13.8
Accounts payable		102.8		106.3		250.5		—		459.6
Intercompany accounts payable		2,664.4		208.5		15.4		(2,888.3)		—
Accrued wages and salaries		33.1		6.5		25.8		—		65.4
Accrued interest		34.7		—		—		—		34.7
Other current liabilities		253.5		27.7		282.8		—		564.0
Current liabilities of business held for sale		—		—		—		—		—
Total current liabilities		3,090.7		353.6		581.7		(2,888.5)		1,137.5
Long-term debt, net of current portion		2,135.5		53.8		10.8		—		2,200.1
Long-term intercompany debt		12.7		—		174.8		(187.5)		—
Deferred income taxes		141.9		305.6		63.1		(158.5)		352.1
Other long-term liabilities		12.8		3.2		59.3		—		75.3
Total liabilities		5,393.6		716.2		889.7		(3,234.5)		3,765.0
Shareholder's equity:
Other capital		2,122.8		439.4		(1,088.0)		631.6		2,105.8
Accumulated (deficit) earnings		(297.7)		4,095.9		2,911.4		(7,007.4)		(297.8)
Accumulated other comprehensive loss		(228.7)		(207.5)		(209.3)		416.8		(228.7)
Total shareholder's equity		1,596.4		4,327.8		1,614.1		(5,959.0)		1,579.3
Non-controlling interest		—		—		11.0		—		11.0
Total equity		1,596.4		4,327.8		1,625.1		(5,959.0)		1,590.3
Total liabilities and equity	$	6,990.0	$	5,044.0	$	2,514.8	$	(9,193.5)	$	5,355.3

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NOTE 21 - GUARANTOR STATEMENTS – SB/RH (continued)



Statement of Financial Position			Guarantor		Nonguarantor
As of September 30, 2018 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Assets
Cash and cash equivalents	$	276.6	$	1.8	$	227.0	$	—	$	505.4
Trade receivables, net		108.9		42.9		165.3		—		317.1
Intercompany receivables		—		1,648.3		283.0		(1,931.3)		—
Other receivables		65.7		1.8		27.6		—		95.1
Inventories		228.5		162.6		204.6		(12.1)		583.6
Prepaid expenses and other		35.3		4.0		23.6		—		62.9
Current assets of business held for sale		551.2		1,379.0		482.5		(10.1)		2,402.6
Total current assets		1,266.2		3,240.4		1,413.6		(1,953.5)		3,966.7
Property, plant and equipment, net		222.9		122.1		155.0		—		500.0
Long-term intercompany receivables		321.3		70.3		11.6		(403.2)		—
Deferred charges and other		200.4		0.6		68.6		(195.4)		74.2
Goodwill		557.4		611.4		285.9		—		1,454.7
Intangible assets, net		770.4		609.5		261.9		—		1,641.8
Investments in subsidiaries		4,900.7		1,262.5		(2.9)		(6,160.3)		—
Total assets	$	8,239.3	$	5,916.8	$	2,193.7	$	(8,712.4)	$	7,637.4
Liabilities and Shareholder's Equity
Current portion of long-term debt	$	535.0	$	4.3	$	7.8	$	(0.2)	$	546.9
Accounts payable		222.4		124.2		238.1		—		584.7
Intercompany accounts payable		1,878.0		—		35.1		(1,913.1)		—
Accrued wages and salaries		24.6		1.5		29.3		—		55.4
Accrued interest		55.0		—		—		—		55.0
Other current liabilities		59.3		15.3		77.8		(0.1)		152.3
Current liabilities of business held for sale		81.7		157.8		298.1		—		537.6
Total current liabilities		2,856.0		303.1		686.2		(1,913.4)		1,931.9
Long-term debt, net of current portion		3,615.3		57.3		13.8		—		3,686.4
Long-term intercompany debt		11.6		295.0		114.8		(421.4)		—
Deferred income taxes		59.4		357.6		70.6		(200.6)		287.0
Other long-term liabilities		71.5		3.1		45.8		—		120.4
Total liabilities		6,613.8		1,016.1		931.2		(2,535.4)		6,025.7
Shareholder's equity:
Other capital		2,096.8		803.7		(1,361.9)		534.4		2,073.0
Accumulated (deficit) earnings		(235.6)		4,303.0		2,814.5		(7,117.4)		(235.5)
Accumulated other comprehensive loss		(235.7)		(206.0)		(200.0)		406.0		(235.7)
Total shareholder's equity		1,625.5		4,900.7		1,252.6		(6,177.0)		1,601.8
Non-controlling interest		—		—		9.9		—		9.9
Total equity		1,625.5		4,900.7		1,262.5		(6,177.0)		1,611.7
Total liabilities and equity	$	8,239.3	$	5,916.8	$	2,193.7	$	(8,712.4)	$	7,637.4

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NOTE 21 - GUARANTOR STATEMENTS – SB/RH (continued)


Statement of Income			Guarantor		Nonguarantor
Three month period ended June 30, 2019 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net sales	$	456.8	$	467.5	$	451.4	$	(353.5)	$	1,022.2
Cost of goods sold		338.3		336.5		341.8		(355.9)		660.7
Restructuring and related charges		—		0.1		0.4		—		0.5
Gross profit		118.5		130.9		109.2		2.4		361.0
Selling		55.4		38.8		57.9		—		152.1
General and administrative		43.9		23.8		11.8		(0.2)		79.3
Research and development		5.8		2.3		2.4		—		10.5
Restructuring and related charges		16.3		0.5		3.4		—		20.2
Transaction related charges		3.3		0.3		1.2		—		4.8
Total operating expense		124.7		65.7		76.7		(0.2)		266.9
Operating (loss) income		(6.2)		65.2		32.4		2.6		94.1
Interest expense (income)		41.6		0.5		(8.5)		0.1		33.7
Other non-operating expense (income), net		53.8		(26.1)		8.3		3.4		39.4
(Loss) income from operations before income taxes		(101.6)		90.8		32.6		(0.9)		21.0
Income tax (benefit) expense		(70.9)		114.4		5.8		0.6		49.9
Net (loss) income from continuing operations		(30.7)		(23.6)		26.8		(1.5)		(28.9)
Loss from discontinued operations, net of tax		(1.2)		—		—		—		(1.2)
Net (loss) income		(31.9)		(23.6)		26.8		(1.5)		(30.1)
Net income attributable to non-controlling interest		—		—		—		—		—
Net (loss) income attributable to controlling interest	$	(31.9)	$	(23.6)	$	26.8	$	(1.5)	$	(30.1)


Statement of Income			Guarantor		Nonguarantor
Nine month period ended June 30, 2019 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net sales	$	1,322.9	$	1,140.4	$	1,442.1	$	(1,096.2)	$	2,809.2
Cost of goods sold		986.9		841.8		1,102.9		(1,096.3)		1,835.3
Restructuring and related charges		—		0.1		1.4		—		1.5
Gross profit		336.0		298.5		337.8		0.1		972.4
Selling		176.2		99.3		183.8		(0.2)		459.1
General and administrative		160.0		65.4		35.7		(1.3)		259.8
Research and development		17.5		7.1		8.1		—		32.7
Restructuring and related charges		30.0		1.4		9.3		—		40.7
Transaction related charges		24.4		(0.3)		(7.7)		—		16.4
Total operating expense		408.1		172.9		229.2		(1.5)		808.7
Operating (loss) income		(72.1)		125.6		108.6		1.6		163.7
Interest expense (income)		134.6		6.6		(16.0)		—		125.2
Other non-operating (income) expense, net		(77.2)		(455.7)		(507.5)		1,104.9		64.5
(Loss) income from operations before income taxes		(129.5)		574.7		632.1		(1,103.3)		(26.0)
Income tax (benefit) expense		(61.3)		75.1		20.6		(0.3)		34.1
Net (loss) income from continuing operations		(68.2)		499.6		611.5		(1,103.0)		(60.1)
Income (loss) from discontinued operations, net of tax		698.8		(82.0)		(7.5)		89.8		699.1
Net income		630.6		417.6		604.0		(1,013.2)		639.0
Net income attributable to non-controlling interest		—		—		1.2		—		1.2
Net income attributable to controlling interest	$	630.6	$	417.6	$	602.8	$	(1,013.2)	$	637.8

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NOTE 21 - GUARANTOR STATEMENTS – SB/RH (continued)




Statement of Income			Guarantor		Nonguarantor
Three month period ended July 1, 2018 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net sales	$	487.8	$	440.9	$	451.0	$	(350.3)	$	1,029.4
Cost of goods sold		352.8		311.8		351.5		(350.9)		665.2
Restructuring and related charges		—		—		1.5		—		1.5
Gross profit		135.0		129.1		98.0		0.6		362.7
Selling		55.0		34.0		58.1		—		147.1
General and administrative		27.7		25.4		13.8		—		66.9
Research and development		5.6		2.3		2.9		—		10.8
Restructuring and related charges		13.6		0.1		2.7		—		16.4
Transaction related charges		3.0		0.8		1.7		—		5.5
Total operating expense		104.9		62.6		79.2		—		246.7
Operating income		30.1		66.5		18.8		0.6		116.0
Interest expense		37.7		4.9		0.8		—		43.4
Other non-operating (income) expense, net		(44.0)		(15.2)		2.8		59.3		2.9
Income from operations before income taxes		36.4		76.8		15.2		(58.7)		69.7
Income tax (benefit) expense		(8.9)		29.1		3.5		(0.1)		23.6
Net income from continuing operations		45.3		47.7		11.7		(58.6)		46.1
Income from discontinued operations, net of tax		28.1		55.2		14.1		(69.6)		27.8
Net income		73.4		102.9		25.8		(128.2)		73.9
Net income attributable to non-controlling interest		—		—		0.2		—		0.2
Net income attributable to controlling interest	$	73.4	$	102.9	$	25.6	$	(128.2)	$	73.7


Statement of Income			Guarantor		Nonguarantor
Nine month period ended July 1, 2018 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net sales	$	1,353.6	$	1,011.7	$	1,456.9	$	(987.9)	$	2,834.3
Cost of goods sold		992.5		726.9		1,110.2		(986.2)		1,843.4
Restructuring and related charges		—		0.1		3.4		—		3.5
Gross profit		361.1		284.7		343.3		(1.7)		987.4
Selling		176.3		92.0		185.1		(0.1)		453.3
General and administrative		79.9		67.7		44.5		—		192.1
Research and development		17.5		6.6		9.7		—		33.8
Restructuring and related charges		45.5		1.2		5.2		—		51.9
Transaction related charges		12.8		3.6		4.0		—		20.4
Total operating expense		332.0		171.1		248.5		(0.1)		751.5
Operating income		29.1		113.6		94.8		(1.6)		235.9
Interest expense		107.9		14.0		2.0		0.1		124.0
Other non-operating (income) expense, net		(285.1)		(78.2)		2.7		366.7		6.1
Income from operations before income taxes		206.3		177.8		90.1		(368.4)		105.8
Income tax (benefit) expense		(3.6)		(109.8)		11.0		(0.5)		(102.9)
Net income from continuing operations		209.9		287.6		79.1		(367.9)		208.7
Income from discontinued operations, net of tax		57.4		99.1		49.1		(145.0)		60.6
Net income		267.3		386.7		128.2		(512.9)		269.3
Net income attributable to non-controlling interest		—		—		1.2		—		1.2
Net income attributable to controlling interest	$	267.3	$	386.7	$	127.0	$	(512.9)	$	268.1

‎

NOTE 21 - GUARANTOR STATEMENTS – SB/RH (continued)


Statement of Comprehensive Income			Guarantor		Nonguarantor
Three month period ended June 30, 2019 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net (loss) income	$	(31.9)	$	(23.6)	$	26.8	$	(1.5)	$	(30.1)
Other comprehensive loss, net of tax:
Foreign currency translation loss		(0.4)		(0.4)		(4.9)		5.4		(0.3)
Unrealized loss on derivative instruments		(6.6)		(1.8)		(1.8)		3.5		(6.7)
Defined benefit pension gain		0.5		0.5		0.5		(1.0)		0.5
Other comprehensive loss		(6.5)		(1.7)		(6.2)		7.9		(6.5)
Comprehensive (loss) income		(38.4)		(25.3)		20.6		6.4		(36.6)
Comprehensive loss attributable to non-controlling interest		—		—		(0.1)		—		(0.1)
Comprehensive (loss) income attributable to controlling interest	$	(38.4)	$	(25.3)	$	20.7	$	6.4	$	(36.5)


Statement of Comprehensive Income			Guarantor		Nonguarantor
Nine month period ended June 30, 2019 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net income	$	630.6	$	417.6	$	604.0	$	(1,013.2)	$	639.0
Other comprehensive loss, net of tax:
Foreign currency translation loss		(23.4)		(24.1)		(32.0)		56.1		(23.4)
Unrealized gain (loss) on derivative instruments		6.6		(0.8)		(0.8)		1.6		6.6
Defined benefit pension gain		1.9		1.6		1.6		(3.2)		1.9
Deconsolidation of discontinued operations		21.8		21.8		21.8		(43.5)		21.9
Other comprehensive income (loss)		6.9		(1.5)		(9.4)		11.0		7.0
Comprehensive income		637.5		416.1		594.6		(1,002.2)		646.0
Comprehensive loss attributable to non-controlling interest		—		—		(0.1)		—		(0.1)
Comprehensive income attributable to controlling interest	$	637.5	$	416.1	$	594.7	$	(1,002.2)	$	646.1


Statement of Comprehensive Income			Guarantor		Nonguarantor
Three month period ended July 1, 2018 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net income	$	73.4	$	102.9	$	25.8	$	(128.2)	$	73.9
Other comprehensive loss, net of tax:
Net unrealized loss on foreign currency translation		(59.2)		(59.2)		(62.4)		121.7		(59.1)
Unrealized gain on hedging derivative instruments		30.4		9.2		9.2		(18.4)		30.4
Defined benefit pension gain		2.9		2.4		2.4		(4.8)		2.9
Other comprehensive loss		(25.9)		(47.6)		(50.8)		98.5		(25.8)
Comprehensive income (loss)		47.5		55.3		(25.0)		(29.7)		48.1
Comprehensive loss attributable to non-controlling interest		—		—		(0.6)		—		(0.6)
Comprehensive income (loss) attributable to controlling interest	$	47.5	$	55.3	$	(24.4)	$	(29.7)	$	48.7


Statement of Comprehensive Income			Guarantor		Nonguarantor
Nine month period ended July 1, 2018 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net income	$	267.3	$	386.7	$	128.2	$	(512.9)	$	269.3
Other comprehensive loss, net of tax:
Net unrealized loss on foreign currency translation		(37.0)		(37.0)		(39.5)		76.6		(36.9)
Unrealized gain on hedging derivative instruments		20.6		13.4		13.4		(26.8)		20.6
Defined benefit pension gain		2.5		1.7		1.7		(3.4)		2.5
Other comprehensive loss		(13.9)		(21.9)		(24.4)		46.4		(13.8)
Comprehensive income		253.4		364.8		103.8		(466.5)		255.5
Comprehensive loss attributable to non-controlling interest		—		—		(0.1)		—		(0.1)
Comprehensive income attributable to controlling interest	$	253.4	$	364.8	$	103.9	$	(466.5)	$	255.6

‎

NOTE 21 - GUARANTOR STATEMENTS – SB/RH (continued)



Statement of Cash Flows			Guarantor		Nonguarantor
Nine month period ended June 30, 2019 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net cash provided (used) by operating activities from continuing operations	$	382.3	$	314.1	$	1,926.0	$	(2,793.8)	$	(171.4)
Net cash provided (used) by operating activities from discontinued operations		2.2		2.5		2.9		(258.0)		(250.4)
Net cash provided (used) provided by operating activities		384.5		316.6		1,928.9		(3,051.8)		(421.8)
Cash flows from investing activities		.
Purchases of property, plant and equipment		(20.2)		(10.6)		(9.5)		—		(40.3)
Proceeds from sales of property, plant and equipment		—		—		0.1		—		0.1
Proceeds from sale of discontinued operations, net of cash		2,854.4		—		—		—		2,854.4
Other investing activities		(0.2)		—		—		—		(0.2)
Net cash provided (used) by investing activities from continuing operations		2,834.0		(10.6)		(9.4)		—		2,814.0
Net cash used by investing activities from discontinued operations		(1.1)		(2.5)		(1.8)		—		(5.4)
Net cash provided (used) by investing activities		2,832.9		(13.1)		(11.2)		—		2,808.6
Cash flows from financing activities
Proceeds from issuance of debt		54.0		—		—		—		54.0
Payment of debt		(2,084.0)		—		(3.9)		—		(2,087.9)
Payment of debt issuance costs		(0.1)		—		—		—		(0.1)
Payment of cash dividends to parent		(696.9)		—		—		—		(696.9)
Advances related to intercompany transactions		(762.7)		(304.8)		(1,984.3)		3,051.8		—
Other financing activities		(8.9)		—		—		—		(8.9)
Net cash used by financing activities from continuing operations		(3,498.6)		(304.8)		(1,988.2)		3,051.8		(2,739.8)
Net cash used by financing activities from discontinued operations		(1.1)		—		(1.1)		—		(2.2)
Net cash used by financing activities		(3,499.7)		(304.8)		(1,989.3)		3,051.8		(2,742.0)
Effect of exchange rate changes on cash and cash equivalents		—		—		(2.9)		—		(2.9)
Net decrease in cash, cash equivalents and restricted cash		(282.3)		(1.3)		(74.5)		—		(358.1)
Cash, cash equivalents and restricted cash, beginning of period		285.5		1.8		227.0		—		514.3
Cash, cash equivalents and restricted cash, end of period	$	3.2	$	0.5	$	152.5	$	—	$	156.2


Statement of Cash Flows			Guarantor		Nonguarantor
Nine month period ended July 1, 2018 (in millions)	Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net cash (used) provided by operating activities from continuing operations	$	(155.7)	$	(29.9)	$	94.5	$	(28.0)	$	(119.1)
Net cash provided by operating activities from discontinued operations		3.9		4.3		8.8		4.6		21.6
Net cash (used) provided by operating activities		(151.8)		(25.6)		103.3		(23.4)		(97.5)
Cash flows from investing activities
Purchases of property, plant and equipment		(27.6)		(8.9)		(20.1)		—		(56.6)
Proceeds from sales of property, plant and equipment		0.8		0.1		1.9		—		2.8
Other investing activity		—		(0.2)		(0.3)				(0.5)
Net cash used by investing activities from continuing operations		(26.8)		(9.0)		(18.5)		—		(54.3)
Net cash used by investing activities from discontinued operations		(3.9)		(4.2)		(11.4)		—		(19.5)
Net cash used by investing activities		(30.7)		(13.2)		(29.9)		—		(73.8)
Cash flows from financing activities
Proceeds from issuance of debt		545.5		—		11.3		—		556.8
Payment of debt		(35.3)		—		(18.8)		—		(54.1)
Payment of debt issuance costs		(0.4)		—		—		—		(0.4)
Payment of cash dividends to parent		(351.8)		—		—		—		(351.8)
Advances related to intercompany transactions		20.9		34.9		(79.2)		23.4		—
Net cash provided (used) by financing activities from continuing operations		178.9		34.9		(86.7)		23.4		150.5
Net cash (used) provided by financing activities from discontinued operations		—		(0.1)		2.7		—		2.6
Net cash provided (used) by financing activities		178.9		34.8		(84.0)		23.4		153.1
Effect of exchange rate changes on cash and cash equivalents		—		—		(3.1)		—		(3.1)
Net decrease in cash, cash equivalents and restricted cash		(3.6)		(4.0)		(13.7)		—		(21.3)
Cash, cash equivalents and restricted cash, beginning of period		21.3		4.8		157.4		—		183.5
Cash, cash equivalents and restricted cash, end of period	$	17.7	$	0.8	$	143.7	$	—	$	162.2