Segment Information

9 Months Ended

Sep. 27, 2014

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company's principal reporting segments are as follows:

• the Air Quality and Home Solutions, formerly Residential Ventilation (“RESV”), segment,

• the Security and Control Solutions, formerly Technology Solutions (“TECH”), segment,

• the Ergonomic and Productivity Solutions, formerly Display Mount Solutions ("DMS"), segment,

• the Residential and Commercial HVAC, formerly Residential Heating and Cooling (“RHC”), segment, and

• the Custom and Commercial Air Solutions, formerly Custom & Engineered Solutions (“CES”), segment.

The SCS segment manufactures and distributes a broad array of products designed to provide convenience and security primarily for residential applications. The principal product categories in this segment include security, automation and access control equipment and systems.

The AVC segments manufacture and distribute a broad array of products primarily for the residential audio/video and professional video signal management markets. The principal product categories in these segments include residential audio/video equipment (including architectural speakers and power conditioners, among other products), home control equipment, and professional video signal management solutions.

For a description of the activities of the Company's other reporting segments, see "Segment Information and Concentration of Credit Risk", of the Company's 2013 Form 10-K.

The Company's performance is significantly impacted by the levels of residential remodeling and replacement activity, as well as the levels of new residential and non-residential construction. The level of new construction activity and, to a lesser extent, the level of residential remodeling and replacement activity are affected by seasonality and cyclical factors such as interest rates, inflation, consumer spending, employment levels, and other macroeconomic factors, over which the Company has no control. Performance in any particular period could be impacted by the timing of sales to certain large customers.

The Company evaluates segment performance based on operating earnings before allocations of corporate overhead costs and impairment charges. With the exception of intersegment net sales between the SCS segment and the combined AVC segments, intersegment net sales and intersegment eliminations are not material for any of the periods presented. The financial statement impact of all acquisition accounting adjustments, including intangible asset amortization and goodwill, are reflected in the applicable operating segment, which are the Company’s reporting units.

Unaudited net sales, operating earnings and earnings (loss) before provision (benefit) for income taxes for the Company’s reporting segments for the third quarter and nine months of 2014 and 2013 were as follows:

	Third quarter of						Nine Months of
	2014			2013			2014			2013
	(Dollar amounts in millions)
Net sales:
AQH	$	146.5		$	150.0		$	438.8		$	444.7
SCS	104.2			98.4			351.0			276.1
ERG	83.9			68.7			214.8			198.7
RCH	153.9			110.3			414.6			335.0
CAS	106.8			114.9			369.6			350.7
AVC	47.6			46.9			120.5			133.8
Consolidated net sales	$	642.9		$	589.2		$	1,909.3		$	1,739.0
Operating earnings (loss):
AQH	$	18.5		$	17.3		$	45.4		$	48.0
SCS	12.8			10.3			35.9			22.2
ERG	15.2			9.6			34.3			26.4
RCH	8.9			7.2			24.0			17.0
CAS	(0.1		)	3.0			23.2			18.5
AVC	(6.3		)	(2.2		)	(19.1		)	(8.3		)
Subtotal	49.0			45.2			143.7			123.8
Impairment of long-lived assets and goodwill	—			—			(80.4		)	—
Unallocated, net	(15.6		)	(12.7		)	(49.5		)	(46.3		)
Consolidated operating earnings	33.4			32.5			13.8			77.5
Net interest expense	(27.3		)	(24.8		)	(78.0		)	(74.1		)
Loss from debt retirement	(0.5		)	—			(2.3		)	—
Earnings (loss) before provision (benefit) for income taxes	$	5.6		$	7.7		$	(66.5	)	$	3.4

Intersegment sales between the SCS segment and the combined AVC segments totaled approximately $3.9 million and $3.1 million for the third quarter of 2014 and 2013, respectively, and totaled approximately $12.2 million and $13.3 million for the nine months of 2014 and 2013, respectively.

See Note F,“Exit & Disposal Activities”and Note G,"Commitments & Contingencies", with respect to certain other items affecting segment earnings (loss).

Segment assets at September 27, 2014 and December 31, 2013 for the Company’s reporting segments are presented in the table that follows:

	September 27, 2014		December 31, 2013
	(Dollar amounts in millions)
Segment Assets:
AQH	$	604.1	$	610.7
SCS	345.5		327.7
ERG	384.8		378.4
RCH	527.5		175.0
CAS	193.1		199.0
AVC	70.6		148.9
	2,125.6		1,839.7
Unallocated:
Cash and cash equivalents, including current restricted cash	66.4		83.8
Deferred tax assets	29.4		29.7
Other assets, including long-term restricted investments and      marketable securities	43.2		37.7
Consolidated assets	$	2,264.6	$	1,990.9