Delaware | 001-01043 | 36-0848180 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
26125 N. Riverwoods Blvd., Suite 500 Mettawa, Illinois | 60045-3420 | |
(Address of Principal Executive Offices) | (Zip Code) |
Exhibit No. | Description of Exhibit |
BRUNSWICK CORPORATION | |||
Dated: July 25, 2019 | By: | /S/ RANDALL S. ALTMAN | |
Randall S. Altman | |||
Vice President and Controller |
![]() | ![]() |
Brunswick Corporation 26125 N. Riverwoods Blvd., Suite 500, Mettawa, IL 60045 | |
Telephone 847.735.4700 Facsimile 847.735.4750 |
Release: | IMMEDIATE | |
Contact: | Ryan Gwillim | |
Vice President - Finance and Treasurer | ||
Phone: | 847-735-4926 | |
Contact: | Daniel Kubera | |
Director - Media Relations and Corporate Communications | ||
Phone: | 847-735-4617 | |
Email: | daniel.kubera@brunswick.com |
Q2 2019 | ||||||||||||
$ millions (except per share data) | GAAP | Increase | As Adjusted | Increase | ||||||||
Net Sales | $ | 1,163.5 | 1.3 | % | $ | 1,164.2 | 3.1 | % | ||||
Operating Earnings | $ | 162.7 | 74.8 | % | $ | 180.1 | 14.6 | % | ||||
Operating Margin | 14.0 | % | 590 bps | 15.5 | % | 160 bps | ||||||
Operating Leverage | NM | 65 | % | |||||||||
Diluted EPS | $ | 1.28 | $ | 1.45 | ||||||||
bps = basis points NM = not meaningful |
Operating Earnings | Diluted Earnings Per Share | |||||||||||||||
$ millions (except per share data) | Q2 2019 | Q2 2018 | Q2 2019 | Q2 2018 | ||||||||||||
GAAP | $ | 162.7 | $ | 93.1 | $ | 1.28 | $ | 0.77 | ||||||||
Restructuring, exit, impairment, and other charges | 5.9 | 34.2 | 0.05 | 0.31 | ||||||||||||
Purchase accounting amortization | 7.3 | — | 0.06 | — | ||||||||||||
Acquisition Related Costs | 1.3 | 2.5 | 0.01 | 0.02 | ||||||||||||
Sport Yacht & Yachts | 2.9 | 27.4 | 0.03 | 0.24 | ||||||||||||
Special Tax Items | — | — | 0.02 | (0.01 | ) | |||||||||||
As Adjusted | $ | 180.1 | $ | 157.2 | $ | 1.45 | $ | 1.33 | ||||||||
Percent Increase | 14.6 | % | 9.0 | % | ||||||||||||
GAAP Operating Margin | 14.0 | % | 8.1 | % | 590 bps | |||||||||||
Adjusted Operating Margin | 15.5 | % | 13.9 | % | 160 bps | |||||||||||
bps = basis points NM = not meaningful |
Brunswick Corporation Comparative Condensed Consolidated Statements of Operations (in millions, except per share data) (unaudited) | ||||||||||
Three Months Ended | ||||||||||
June 29, 2019 | June 30, 2018 | % Change | ||||||||
Net sales | $ | 1,163.5 | $ | 1,148.7 | 1 | % | ||||
Cost of sales | 835.5 | 867.5 | -4 | % | ||||||
Selling, general and administrative expense | 126.4 | 121.4 | 4 | % | ||||||
Research and development expense | 33.5 | 32.5 | 3 | % | ||||||
Restructuring, exit and impairment charges | 5.4 | 34.2 | -84 | % | ||||||
Operating earnings | 162.7 | 93.1 | 75 | % | ||||||
Equity earnings | 1.6 | 1.4 | 14 | % | ||||||
Other expense, net | (0.1 | ) | (2.4 | ) | -96 | % | ||||
Earnings before interest and income taxes | 164.2 | 92.1 | 78 | % | ||||||
Interest expense | (20.8 | ) | (8.2 | ) | NM | |||||
Interest income | 0.4 | 0.6 | -33 | % | ||||||
Earnings before income taxes | 143.8 | 84.5 | 70 | % | ||||||
Income tax provision | 31.7 | 16.4 | 93 | % | ||||||
Net earnings from continuing operations | $ | 112.1 | $ | 68.1 | 65 | % | ||||
Discontinued operations: | ||||||||||
Earnings from discontinued operations, net of tax | $ | 6.9 | $ | 10.9 | -37 | % | ||||
Loss on disposal of discontinued operations, net of tax | (41.5 | ) | — | NM | ||||||
Net earnings (loss) from discontinued operations, net of tax | (34.6 | ) | 10.9 | NM | ||||||
Net earnings | $ | 77.5 | $ | 79.0 | -2 | % | ||||
Earnings (loss) per common share: | ||||||||||
Basic | ||||||||||
Earnings from continuing operations | $ | 1.29 | $ | 0.78 | 65 | % | ||||
Earnings (loss) from discontinued operations | (0.40 | ) | 0.12 | NM | ||||||
Net earnings | $ | 0.89 | $ | 0.90 | -1 | % | ||||
Diluted | ||||||||||
Earnings from continuing operations | $ | 1.28 | $ | 0.77 | 66 | % | ||||
Earnings (loss) from discontinued operations | (0.39 | ) | 0.13 | NM | ||||||
Net earnings | $ | 0.89 | $ | 0.90 | -1 | % | ||||
Weighted average shares used for computation of: | ||||||||||
Basic earnings (loss) per common share | 86.9 | 87.6 | ||||||||
Diluted earnings (loss) per common share | 87.3 | 88.2 | ||||||||
Effective tax rate | 22.0 | % | 19.4 | % | ||||||
NM = not meaningful |
Brunswick Corporation Comparative Condensed Consolidated Statements of Operations - Reconciliations to Adjusted Metrics (in millions, except per share data) (unaudited) | ||||||||||
Three Months Ended | ||||||||||
June 29, 2019 | June 30, 2018 | % Change | ||||||||
Reconciliations | ||||||||||
Net sales | $ | 1,163.5 | $ | 1,148.7 | 1 | % | ||||
Sport yacht & yachts (1) | 0.7 | (19.9 | ) | |||||||
Adjusted net sales | $ | 1,164.2 | $ | 1,128.8 | 3 | % | ||||
Gross margin | $ | 328.0 | $ | 281.2 | 17 | % | ||||
Sport yacht & yachts (1) | 2.5 | 23.2 | ||||||||
Adjusted gross margin | $ | 330.5 | $ | 304.4 | 9 | % | ||||
Operating earnings | $ | 162.7 | $ | 93.1 | 75 | % | ||||
Restructuring, exit, impairment and other charges (4) | 5.9 | 34.2 | ||||||||
Purchase accounting amortization (2) | 7.3 | — | ||||||||
Sport yacht & yachts (1) | 2.9 | 27.4 | ||||||||
Acquisition-related costs (3) | 1.3 | 2.5 | ||||||||
Adjusted operating earnings | $ | 180.1 | $ | 157.2 | 15 | % | ||||
Earnings before income taxes | $ | 143.8 | $ | 84.5 | 70 | % | ||||
Restructuring, exit, impairment and other charges (4) | 5.9 | 34.2 | ||||||||
Purchase accounting amortization (2) | 7.3 | — | ||||||||
Sport yacht & yachts (1) | 2.9 | 27.4 | ||||||||
Acquisition related costs (3) | 1.3 | 2.5 | ||||||||
Adjusted pretax earnings | $ | 161.2 | $ | 148.6 | 8 | % | ||||
Diluted earnings per common share from continuing operations | $ | 1.28 | $ | 0.77 | 66 | % | ||||
Restructuring, exit, impairment and other charges (4) | 0.05 | 0.31 | ||||||||
Purchase accounting amortization (2) | 0.06 | — | ||||||||
Sport yacht & yachts (1) | 0.03 | 0.24 | ||||||||
Special tax items | 0.02 | (0.01 | ) | |||||||
Acquisition related costs (3) | 0.01 | 0.02 | ||||||||
Adjusted diluted earnings per common share from continuing operations | $ | 1.45 | $ | 1.33 | 9 | % | ||||
(1) In the second quarter of 2018, the Company announced its intention to wind down Sport yacht & yacht operations. In the second quarter of 2019, the Company recorded charges of $2.9 million related to the Sport yacht & yachts, consisting of ($0.7) million of net sales, $1.8 million of Cost of sales (COS) and $0.4 million of Selling, general and administrative expense (SG&A). Sport yacht & yacht operations had operating losses of $27.4 million for the three months ended June 30, 2018, consisting of $19.9 million of Net sales, $43.1 million of COS and $4.2 million of SG&A. | ||||||||||
(2) The Company recorded purchase accounting amortization of $7.2 million and $0.1 million in SG&A, within the Marine Engine and Boat segments, respectively, in the second quarter of 2019. | ||||||||||
(3) In the second quarter of 2019, as a result of the Freedom Boat Club acquisition, the Company recorded acquisition-related costs of $1.3 million in SG&A within the Boat segment. In the second quarter of 2018, as a result of the Power Products acquisition, the Company recorded acquisition-related costs of $2.5 million in SG&A within the Marine Engine segment. | ||||||||||
(4) The Company recorded $5.4 million and $34.2 million of restructuring, exit and impairment charges in the second quarter of 2019 and 2018, respectively. Additionally, the Company recorded $0.5 million of IT transformation charges in SG&A within Corporate/Other in the second quarter of 2019. | ||||||||||
Brunswick Corporation Comparative Condensed Consolidated Statements of Operations (in millions, except per share data) (unaudited) | |||||||||||
Six Months Ended | |||||||||||
June 29, 2019 | June 30, 2018 | % Change | |||||||||
Net sales | $ | 2,214.2 | $ | 2,115.7 | 5 | % | |||||
Cost of sales | 1,606.7 | 1,591.4 | 1 | % | |||||||
Selling, general and administrative expense | 259.9 | 237.6 | 9 | % | |||||||
Research and development expense | 62.2 | 62.3 | 0 | % | |||||||
Restructuring, exit and impairment charges | 8.6 | 36.8 | -77 | % | |||||||
Operating earnings | 276.8 | 187.6 | 48 | % | |||||||
Equity earnings | 3.5 | 2.4 | 46 | % | |||||||
Other expense, net | (1.7 | ) | (2.8 | ) | -39 | % | |||||
Earnings before interest and income taxes | 278.6 | 187.2 | 49 | % | |||||||
Interest expense | (40.6 | ) | (14.9 | ) | NM | ||||||
Interest income | 0.8 | 1.3 | -38 | % | |||||||
Earnings before income taxes | 238.8 | 173.6 | 38 | % | |||||||
Income tax provision | 50.5 | 41.7 | 21 | % | |||||||
Net earnings from continuing operations | $ | 188.3 | $ | 131.9 | 43 | % | |||||
Discontinued operations: | |||||||||||
Earnings (loss) from discontinued operations, net of tax | $ | (105.6 | ) | $ | 20.0 | NM | |||||
Loss on disposal of discontinued operations, net of tax | (41.5 | ) | — | NM | |||||||
Net earnings (loss) from discontinued operations, net of tax | (147.1 | ) | 20.0 | NM | |||||||
Net earnings | $ | 41.2 | $ | 151.9 | -73 | % | |||||
Earnings (loss) per common share: | |||||||||||
Basic | |||||||||||
Earnings from continuing operations | $ | 2.16 | $ | 1.50 | 44 | % | |||||
Earnings (loss) from discontinued operations | (1.69 | ) | 0.23 | NM | |||||||
Net earnings | $ | 0.47 | $ | 1.73 | -73 | % | |||||
Diluted | |||||||||||
Earnings from continuing operations | $ | 2.15 | $ | 1.49 | 44 | % | |||||
Earnings (loss) from discontinued operations | (1.68 | ) | 0.23 | NM | |||||||
Net earnings | $ | 0.47 | $ | 1.72 | -73 | % | |||||
Weighted average shares used for computation of: | |||||||||||
Basic earnings (loss) per common share | 87.2 | 87.8 | |||||||||
Diluted earnings (loss) per common share | 87.7 | 88.5 | |||||||||
Effective tax rate | 21.1 | % | 24.0 | % | |||||||
NM = not meaningful |
Brunswick Corporation Comparative Condensed Consolidated Statements of Operations - Reconciliations to Adjusted Metrics (in millions, except per share data) (unaudited) | |||||||||||
Six Months Ended | |||||||||||
June 29, 2019 | June 30, 2018 | % Change | |||||||||
Reconciliations | |||||||||||
Net sales | $ | 2,214.2 | $ | 2,115.7 | 5 | % | |||||
Sport yacht & yachts 1) | 0.7 | (35.0 | ) | ||||||||
Adjusted net sales | $ | 2,214.9 | $ | 2,080.7 | 6 | % | |||||
Gross margin | $ | 607.5 | $ | 524.3 | 16 | % | |||||
Sport yacht & yachts (1) | 2.5 | 26.8 | |||||||||
Adjusted gross margin | $ | 610.0 | $ | 551.1 | 11 | % | |||||
Operating earnings | $ | 276.8 | $ | 187.6 | 48 | % | |||||
Restructuring, exit, impairment and other charges (4) | 9.1 | 36.8 | |||||||||
Purchase accounting amortization (2) | 14.5 | — | |||||||||
Sport yacht & yachts (1) | 2.9 | 35.5 | |||||||||
Acquisition-related costs (3) | 1.3 | — | 2.5 | ||||||||
Adjusted operating earnings | $ | 304.6 | $ | 262.4 | 16 | % | |||||
Earnings before income taxes | $ | 238.8 | $ | 173.6 | 38 | % | |||||
Restructuring, exit, impairment and other charges (4) | 9.1 | 36.8 | |||||||||
Purchase accounting amortization (2) | 14.5 | — | |||||||||
Sport yacht & yachts (1) | 2.9 | 35.5 | |||||||||
Acquisition-related costs (3) | 1.3 | 2.5 | |||||||||
Adjusted pretax earnings | $ | 266.6 | $ | 248.4 | 7 | % | |||||
Diluted earnings per common share | $ | 2.15 | $ | 1.49 | 44 | % | |||||
Restructuring, exit, impairment and other charges (4) | 0.07 | 0.32 | |||||||||
Purchase accounting amortization (2) | 0.13 | — | |||||||||
Sport yacht & yachts (1) | 0.03 | 0.32 | |||||||||
Acquisition-related costs (3) | 0.01 | 0.02 | |||||||||
Special tax items | 0.00 | 0.06 | |||||||||
Adjusted diluted earnings per common share | $ | 2.39 | $ | 2.21 | 8 | % | |||||
(1) In the second quarter of 2018, the Company announced its intention to wind down Sport yacht & yacht operations. In the second quarter of 2019, the Company recorded charges of $2.9 million related to the Sport yacht & yachts, consisting of ($0.7) million of net sales, $1.8 million of Cost of sales (COS) and $0.4 million of Selling, general and administrative expense (SG&A). Sport yacht & yacht operations had operating losses of $35.5 million for the six months ended June 30, 2018, consisting of $35.0 million of Net sales, $61.8 million of COS and $8.7 million of SG&A. | |||||||||||
(2) The Company recorded purchase accounting amortization of $14.4 million and $0.1 million in SG&A, within the Marine Engine and Boat segments, respectively, in the second quarter of 2019. | |||||||||||
(3) In the second quarter of 2019, as a result of the Freedom Boat Club acquisition, the Company recorded acquisition-related costs of $1.3 million in SG&A within the Boat segment. In the second quarter of 2018, as a result of the Power Products acquisition, the Company recorded acquisition-related costs of $2.5 million in SG&A within the Marine Engine segment. | |||||||||||
(4) The Company recorded $8.6 million and $36.8 million of restructuring, exit and impairment charges in the second quarter of 2019 and 2018, respectively. Additionally, the Company recorded $0.5 million of IT transformation charges in SG&A within Corporate/Other in the second quarter of 2019. |
Brunswick Corporation Selected Financial Information (in millions) (unaudited) Segment Information - GAAP | |||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||
Net Sales | Operating Earnings (Loss) | Operating Margin | |||||||||||||||||||||||||
Jun 29, 2019 | Jun 30, 2018 | % Change | Jun 29, 2019 | Jun 30, 2018 | % Change | Jun 29, 2019 | Jun 30, 2018 | ||||||||||||||||||||
Marine Engine | $ | 871.5 | $ | 834.3 | 4 | % | $ | 164.6 | $ | 149.1 | 10 | % | 18.9 | % | 17.9 | % | |||||||||||
Boat | 366.6 | 394.9 | -7 | % | 20.8 | (32.2 | ) | NM | 5.7 | % | -8.2 | % | |||||||||||||||
Marine eliminations | (74.6 | ) | (80.5 | ) | -7 | % | — | — | |||||||||||||||||||
Total Marine | 1,163.5 | 1,148.7 | 1 | % | 185.4 | 116.9 | 59 | % | 15.9 | % | 10.2 | % | |||||||||||||||
Corporate/Other | — | — | (22.7 | ) | (23.8 | ) | -5 | % | |||||||||||||||||||
Total | $ | 1,163.5 | $ | 1,148.7 | 1 | % | $ | 162.7 | $ | 93.1 | 75 | % | 14.0 | % | 8.1 | % | |||||||||||
Six Months Ended | |||||||||||||||||||||||||||
Net Sales | Operating Earnings (Loss) | Operating Margin | |||||||||||||||||||||||||
Jun 29, 2019 | Jun 30, 2018 | % Change | Jun 29, 2019 | Jun 30, 2018 | % Change | Jun 29, 2019 | Jun 30, 2018 | ||||||||||||||||||||
Marine Engine | $ | 1,637.5 | $ | 1,521.4 | 8 | % | $ | 277.5 | $ | 244.8 | 13 | % | 16.9 | % | 16.1 | % | |||||||||||
Boat | 739.9 | 771.4 | -4 | % | 42.8 | (17.8 | ) | NM | 5.8 | % | -2.3 | % | |||||||||||||||
Marine eliminations | (163.2 | ) | (177.1 | ) | -8 | % | — | — | |||||||||||||||||||
Total Marine | 2,214.2 | 2,115.7 | 5 | % | 320.3 | 227.0 | 41 | % | 14.5 | % | 10.7 | % | |||||||||||||||
Corporate/Other | — | — | (43.5 | ) | (39.4 | ) | 10 | % | |||||||||||||||||||
Total | $ | 2,214.2 | $ | 2,115.7 | 5 | % | $ | 276.8 | $ | 187.6 | 48 | % | 12.5 | % | 8.9 | % | |||||||||||
Three Months Ended | |||||||||||||||||||||||||||||
Net Sales (1) | Operating Earnings (Loss) (2) | Operating Margin | |||||||||||||||||||||||||||
Jun 29, 2019 | Jun 30, 2018 | % Change | Jun 29, 2019 | Jun 30, 2018 | % Change | Jun 29, 2019 | Jun 30, 2018 | ||||||||||||||||||||||
Marine Engine | $ | 871.5 | $ | 834.3 | 4 | % | $ | 172.4 | $ | 151.6 | 14 | % | 19.8 | % | 18.2 | % | |||||||||||||
Boat | 367.3 | 375.0 | -2 | % | — | 27.7 | — | 28.7 | -3 | % | 7.5 | % | 7.7 | % | |||||||||||||||
Marine eliminations | (74.6 | ) | (80.5 | ) | -7 | % | — | — | |||||||||||||||||||||
Total Marine | 1,164.2 | 1,128.8 | 3 | % | 200.1 | 180.3 | 11 | % | 17.2 | % | 16.0 | % | |||||||||||||||||
Corporate/Other | — | — | (20.0 | ) | — | (23.1 | ) | -13 | % | ||||||||||||||||||||
Total | $ | 1,164.2 | $ | 1,128.8 | 3 | % | $ | 180.1 | $ | 157.2 | 15 | % | 15.5 | % | 13.9 | % | |||||||||||||
Six Months Ended | |||||||||||||||||||||||||||
Net Sales (3) | Operating Earnings (Loss) (4) | Operating Margin | |||||||||||||||||||||||||
Jun 29, 2019 | Jun 30, 2018 | % Change | Jun 29, 2019 | Jun 30, 2018 | % Change | Jun 29, 2019 | Jun 30, 2018 | ||||||||||||||||||||
Marine Engine | $ | 1,637.5 | $ | 1,521.4 | 8 | % | $ | 292.5 | $ | 247.3 | 18 | % | 17.9 | % | 16.3 | % | |||||||||||
Boat | 740.6 | 736.4 | 1 | % | 51.7 | 53.8 | -4 | % | 7.0 | % | 7.3 | % | |||||||||||||||
Marine eliminations | (163.2 | ) | (177.1 | ) | -8 | % | — | — | |||||||||||||||||||
Total Marine | 2,214.9 | 2,080.7 | 6 | % | 344.2 | 301.1 | 14 | % | 15.5 | % | 14.5 | % | |||||||||||||||
Corporate/Other | — | — | (39.6 | ) | (38.7 | ) | -2 | % | |||||||||||||||||||
Total | $ | 2,214.9 | $ | 2,080.7 | 6 | % | $ | 304.6 | $ | 262.4 | 16 | % | 13.8 | % | 12.6 | % | |||||||||||
Brunswick Corporation Selected Financial Information (in millions) (unaudited) Disaggregated Revenue | |||||||||||
Three Months Ended | |||||||||||
June 29, 2019 | |||||||||||
Marine Engine | Boat (1) | Total | |||||||||
Geographic Markets | |||||||||||
United States | $ | 610.7 | $ | 271.2 | $ | 881.9 | |||||
Europe | 125.7 | 34.6 | 160.3 | ||||||||
Asia-Pacific | 57.4 | 6.4 | 63.8 | ||||||||
Canada | 39.5 | 47.4 | 86.9 | ||||||||
Rest-of-World | 38.2 | 7.0 | 45.2 | ||||||||
Marine eliminations | (74.6 | ) | — | (74.6 | ) | ||||||
Total | $ | 796.9 | $ | 366.6 | $ | 1,163.5 | |||||
Major Product Lines | |||||||||||
Propulsion | $ | 404.9 | $ | — | $ | 404.9 | |||||
Parts & Accessories | 466.6 | — | 466.6 | ||||||||
Aluminum Freshwater Boats | — | 160.8 | 160.8 | ||||||||
Recreational Fiberglass Boats | — | 119.5 | 119.5 | ||||||||
Saltwater Fishing Boats | — | 82.6 | 82.6 | ||||||||
Business Acceleration | — | 3.7 | 3.7 | ||||||||
Marine eliminations | (74.6 | ) | — | (74.6 | ) | ||||||
Total | $ | 796.9 | $ | 366.6 | $ | 1,163.5 |
Six Months Ended | |||||||||||
June 29, 2019 | |||||||||||
Marine Engine | Boat (1) | Total | |||||||||
Geographic Markets | |||||||||||
United States | $ | 1,134.9 | $ | 545.1 | $ | 1,680.0 | |||||
Europe | 244.9 | 71.3 | 316.2 | ||||||||
Asia-Pacific | 113.5 | 11.8 | 125.3 | ||||||||
Canada | 70.8 | 97.4 | 168.2 | ||||||||
Rest-of-World | 73.4 | 14.3 | 87.7 | ||||||||
Marine eliminations | (163.2 | ) | — | (163.2 | ) | ||||||
Total | $ | 1,474.3 | $ | 739.9 | $ | 2,214.2 | |||||
Major Product Lines | |||||||||||
Propulsion | $ | 804.9 | $ | — | $ | 804.9 | |||||
Parts & Accessories | 832.6 | — | 832.6 | ||||||||
Aluminum Freshwater Boats | — | 327.0 | 327.0 | ||||||||
Recreational Fiberglass Boats | — | 234.5 | 234.5 | ||||||||
Saltwater Fishing Boats | — | 172.8 | 172.8 | ||||||||
Business Acceleration | — | 5.6 | 5.6 | ||||||||
Marine eliminations | (163.2 | ) | — | (163.2 | ) | ||||||
Total | $ | 1,474.3 | $ | 739.9 | $ | 2,214.2 |
Three Months Ended | |||||||||||
June 30, 2018 | |||||||||||
Marine Engine | Boat (1) | Total | |||||||||
Geographic Markets | |||||||||||
United States | $ | 594.4 | $ | 279.9 | $ | 874.3 | |||||
Europe | 113.2 | 42.0 | 155.2 | ||||||||
Asia-Pacific | 50.5 | 6.9 | 57.4 | ||||||||
Canada | 39.4 | 58.1 | 97.5 | ||||||||
Rest-of-World | 36.8 | 8.0 | 44.8 | ||||||||
Marine eliminations | (80.5 | ) | — | (80.5 | ) | ||||||
Total | $ | 753.8 | $ | 394.9 | $ | 1,148.7 | |||||
Major Product Lines | |||||||||||
Propulsion | $ | 426.3 | $ | — | $ | 426.3 | |||||
Parts & Accessories | 408.0 | — | 408.0 | ||||||||
Aluminum Freshwater Boats | — | 169.7 | 169.7 | ||||||||
Recreational Fiberglass Boats | — | 140.5 | 140.5 | ||||||||
Saltwater Fishing Boats | — | 84.0 | 84.0 | ||||||||
Business Acceleration | — | 0.7 | 0.7 | ||||||||
Marine eliminations | (80.5 | ) | — | (80.5 | ) | ||||||
Total | $ | 753.8 | $ | 394.9 | $ | 1,148.7 |
Six Months Ended | |||||||||||
June 30, 2018 | |||||||||||
Marine Engine | Boat (1) | Total | |||||||||
Geographic Markets | |||||||||||
United States | $ | 1,070.9 | $ | 554.6 | $ | 1,625.5 | |||||
Europe | 211.0 | 85.1 | 296.1 | ||||||||
Asia-Pacific | 100.9 | 13.9 | 114.8 | ||||||||
Canada | 68.3 | 104.9 | 173.2 | ||||||||
Rest-of-World | 70.3 | 12.9 | 83.2 | ||||||||
Marine eliminations | (177.1 | ) | — | (177.1 | ) | ||||||
Total | $ | 1,344.3 | $ | 771.4 | $ | 2,115.7 | |||||
Major Product Lines | |||||||||||
Propulsion | $ | 805.3 | $ | — | $ | 805.3 | |||||
Parts & Accessories | 716.1 | — | 716.1 | ||||||||
Aluminum Freshwater Boats | — | 331.3 | 331.3 | ||||||||
Recreational Fiberglass Boats | — | 268.2 | 268.2 | ||||||||
Saltwater Fishing Boats | — | 169.7 | 169.7 | ||||||||
Business Acceleration | — | 2.2 | 2.2 | ||||||||
Marine eliminations | (177.1 | ) | — | (177.1 | ) | ||||||
Total | $ | 1,344.3 | $ | 771.4 | $ | 2,115.7 |
Brunswick Corporation Comparative Condensed Consolidated Balance Sheets (in millions) (unaudited) | |||||||||||
June 29, 2019 | December 31, 2018 | June 30, 2018 | |||||||||
Assets | |||||||||||
Current assets | |||||||||||
Cash and cash equivalents, at cost, which approximates fair value | $ | 656.1 | $ | 294.4 | $ | 435.9 | |||||
Restricted cash | 11.6 | 9.0 | 9.4 | ||||||||
Short-term investments in marketable securities | 0.8 | 0.8 | 0.8 | ||||||||
Total cash and short-term investments in marketable securities | 668.5 | 304.2 | 446.1 | ||||||||
Accounts and notes receivable, net | 484.5 | 351.8 | 412.4 | ||||||||
Inventories | |||||||||||
Finished goods | 528.8 | 490.8 | 371.1 | ||||||||
Work-in-process | 98.2 | 94.1 | 106.3 | ||||||||
Raw materials | 174.8 | 189.1 | 163.9 | ||||||||
Net inventories | 801.8 | 774.0 | 641.3 | ||||||||
Prepaid expenses and other | 56.6 | 72.9 | 36.8 | ||||||||
Current assets held for sale | — | 377.2 | 354.4 | ||||||||
Current assets | 2,011.4 | 1,880.1 | 1,891.0 | ||||||||
Net property | 747.0 | 694.5 | 595.0 | ||||||||
Other assets | |||||||||||
Goodwill | 410.7 | 377.3 | 33.5 | ||||||||
Other intangibles, net | 599.4 | 585.8 | 58.5 | ||||||||
Operating lease assets | 80.4 | — | — | ||||||||
Deferred income tax asset | 144.2 | 97.8 | 176.6 | ||||||||
Equity investments | 32.7 | 32.6 | 30.0 | ||||||||
Other long-term assets | 15.0 | 13.1 | 12.5 | ||||||||
Long-term assets held for sale | — | 610.3 | 639.6 | ||||||||
Other assets | 1,282.4 | 1,716.9 | 950.7 | ||||||||
Total assets | $ | 4,040.8 | $ | 4,291.5 | $ | 3,436.7 | |||||
Liabilities and shareholders’ equity | |||||||||||
Current liabilities | |||||||||||
Short-term debt and current maturities of long-term debt | $ | 40.3 | $ | 41.3 | $ | 4.7 | |||||
Accounts payable | 412.9 | 458.2 | 374.6 | ||||||||
Accrued expenses | 562.5 | 502.1 | 503.8 | ||||||||
Current liabilities held for sale | — | 255.0 | 232.1 | ||||||||
Current liabilities | 1,015.7 | 1,256.6 | 1,115.2 | ||||||||
Debt | 1,240.1 | 1,179.5 | 429.0 | ||||||||
Other long-term liabilities | 247.7 | 173.2 | 295.0 | ||||||||
Long-term liabilities held for sale | — | 99.6 | 96.5 | ||||||||
Shareholders’ equity | 1,537.3 | 1,582.6 | 1,501.0 | ||||||||
Total liabilities and shareholders’ equity | $ | 4,040.8 | $ | 4,291.5 | $ | 3,436.7 | |||||
Supplemental Information | |||||||||||
Debt-to-capitalization rate | 45.4 | % | 43.5 | % | 22.4 | % |
Brunswick Corporation Comparative Condensed Consolidated Statements of Cash Flows (in millions) (unaudited) | |||||||
Six Months Ended | |||||||
June 29, 2019 | June 30, 2018 | ||||||
Cash flows from operating activities | |||||||
Net earnings | $ | 41.2 | $ | 151.9 | |||
Less: net earnings (loss) from discontinued operations, net of tax | (147.1 | ) | 20.0 | ||||
Net earnings from continuing operations | 188.3 | 131.9 | |||||
Stock compensation expense | 7.0 | 6.2 | |||||
Depreciation and amortization | 66.4 | 49.9 | |||||
Pension expense, net of (funding) | 1.2 | (33.3 | ) | ||||
Asset impairment charges | 2.9 | 24.9 | |||||
Deferred income taxes | 29.3 | 14.0 | |||||
Changes in certain current assets and current liabilities | (154.0 | ) | (58.7 | ) | |||
Long-term extended warranty contracts and other deferred revenue | 6.1 | 6.0 | |||||
Income taxes | 6.4 | 29.9 | |||||
Other, net | (6.2 | ) | (3.8 | ) | |||
Net cash provided by operating activities of continuing operations | 147.4 | 167.0 | |||||
Net cash (used for) provided by for operating activities of discontinued operations | (8.1 | ) | 33.9 | ||||
Net cash provided by operating activities | 139.3 | 200.9 | |||||
Cash flows from investing activities | |||||||
Capital expenditures | (135.2 | ) | (81.7 | ) | |||
Investments | (0.2 | ) | (5.8 | ) | |||
Acquisition of businesses, net of cash acquired | (64.4 | ) | — | ||||
Proceeds from the sale of property, plant and equipment | — | 0.1 | |||||
Other, net | — | (0.2 | ) | ||||
Net cash used for investing activities of continuing operations | (199.8 | ) | (87.6 | ) | |||
Net cash provided by (used for) investing activities of discontinued operations | 481.9 | (8.5 | ) | ||||
Net cash provided by (used for) investing activities | 282.1 | (96.1 | ) | ||||
Cash flows from financing activities | |||||||
Proceeds from issuances of short-term debt | 655.0 | — | |||||
Payments of short-term debt | (655.0 | ) | — | ||||
Net proceeds from issuances of long-term debt | 223.1 | — | |||||
Payments of long-term debt including current maturities | (168.1 | ) | (0.3 | ) | |||
Common stock repurchases | (69.8 | ) | (70.0 | ) | |||
Cash dividends paid | (36.4 | ) | (33.1 | ) | |||
Proceeds from share-based compensation activity | 0.9 | 1.2 | |||||
Tax withholding associated with shares issued for share-based compensation | (8.0 | ) | (12.0 | ) | |||
Other, net | (0.2 | ) | — | ||||
Net cash used for financing activities | (58.5 | ) | (114.2 | ) | |||
Effect of exchange rate changes | 1.4 | (3.5 | ) | ||||
Net Increase (decrease) in Cash and cash equivalents and Restricted cash | 364.3 | (12.9 | ) | ||||
Cash and cash equivalents and Restricted cash at beginning of period | 303.4 | 458.2 | |||||
Cash and cash equivalents and Restricted cash at end of period | 667.7 | 445.3 | |||||
Less: Restricted cash | 11.6 | 9.4 | |||||
Cash and cash equivalents at end of period | $ | 656.1 | $ | 435.9 | |||
Reconciliation | |||||||
Free cash flow | |||||||
Net cash used for operating activities | $ | 147.4 | $ | 167.0 | |||
Net cash provided by (used for): | |||||||
Plus: Capital expenditures | (135.2 | ) | (81.7 | ) | |||
Plus: Proceeds from the sale of property, plant and equipment | — | 0.1 | |||||
Plus: Effect of exchange rate changes | 1.4 | (3.5 | ) | ||||
Less: Cash impact of Sport Yacht & Yacht operations, net of tax | — | (13.8 | ) | ||||
Free cash flow | $ | 13.6 | $ | 95.7 |
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