UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report:
July 12, 2007
---------------------------------------
(Date of earliest event reported)
SPECTRUM BRANDS, INC.
------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
Wisconsin 001-13615 22-2423556
------------------------------ --------------- -----------------------------
(State or other Jurisdiction (Commission (IRS Employer
of Incorporation) File No.) Identification No.)
Six Concourse Parkway, Suite 3300, Atlanta, Georgia 30328
---------------------------------------------------------
(Address of principal executive offices, including zip code)
(770) 829-6200
------------------------------------------------------
(Registrant's telephone number, including area code)
N/A
---------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the Registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On July 12, 2007, Spectrum Brands, Inc. (the "Company") issued a press
release announcing that it anticipates that full year 2007 sales and EBITDA will
be lower than previously anticipated in light of the Company's preliminary
financial results for its recently completed third fiscal quarter and
projections for its fourth fiscal quarter. A copy of the press release is
attached hereto as Exhibit 99.1.
Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements, which
are based on the Company's current expectations and involve risks and
uncertainties, including, but not limited to, risks and uncertainties relating
to the Company's continued review of its third fiscal quarter financial results.
The Company cautions the reader that actual results could differ materially from
the expectations described in the forward-looking statements. The Company also
cautions the reader that undue reliance should not be placed on any of the
forward-looking statements, which speak only as of the date of this Current
Report on Form 8-K. The Company undertakes no responsibility to update any of
these forward-looking statements to reflect events or circumstances after the
date of this report or to reflect actual outcomes.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits
99.1 Press Release dated July 12, 2007 issued by Spectrum Brands, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: July 12, 2007 SPECTRUM BRANDS, INC.
By: /s/ Anthony L. Genito
-----------------------------------
Name: Anthony L. Genito
Title: Senior Vice President, Chief
Financial Officer and Chief
Accounting Officer
EXHIBIT INDEX
Exhibit Description
- ------- -----------
99.1 Press Release dated July 12, 2007 issued by Spectrum Brands, Inc.
Exhibit 99.1
Spectrum Brands Updates FY07 Financial Projections
ATLANTA--(BUSINESS WIRE)--July 12, 2007--Spectrum Brands, Inc.
(NYSE: SPC) announced today it anticipates that full year 2007 sales
and earnings before interest, tax, depreciation and amortization
(EBITDA) will be lower than previously anticipated. Preliminary
results for the recently completed fiscal third quarter and
projections for the fiscal fourth quarter suggest that the company
will generate full year 2007 net sales of approximately $2,634 million
and EBITDA of between $260 and $264 million. This compares with
earlier expectations of net sales of $2,648 million and EBITDA of $282
million. (See Table I for further details.)
The company lowered projections due to unfavorable weather
conditions experienced during the fiscal third quarter, particularly
the impact of drought conditions across much of the country, which had
a negative impact on its Home & Garden business, as well as lower than
expected European battery sales and a cautious outlook on the part of
U.S. retailers regarding inventory levels, which caused a shortfall in
projected results for Global Batteries and Personal Care.
Commenting on the company's performance and outlook, Spectrum
Brands Chief Executive Officer Kent Hussey stated, "Our Home & Garden
business is performing well as measured by market share and customer
service levels, despite recent weather conditions. We remain confident
in the fundamental strength of this business and our ability to
execute a sale of this asset at a fair valuation. We continue to make
progress on our corporate strategy and believe we are taking the right
actions to improve profitability in all of our business segments,
strengthen our capital structure through the strategic sale of one or
more assets, and create sustainable value for our equity holders."
The company does not anticipate any liquidity issues or problems
complying with its debt covenants as a result of its revised
projections. As previously announced, Spectrum has received financing
commitments from Goldman Sachs and Wachovia Bank to provide the
company with a $225 million asset based loan facility, with a
concomitant reduction of its senior credit facility term loan by the
same amount. The company expects to close on this transaction during
its fiscal fourth quarter.
Spectrum Brands will host a conference call with members of the
investment community on August 7, 2007 at 8:30 a.m. EDT to discuss
fiscal third quarter results. Access to the call will be available at
www.spectrumbrands.com.
Forward Looking Statements
Certain matters discussed in this news release, with the exception
of historical matters, may be forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
statements are subject to a number of risks and uncertainties that
could cause results to differ materially from those anticipated as of
the date of this release. Actual results may differ materially from
these statements as a result of (1) changes in external competitive
market factors, such as introduction of new product features or
technological developments, development of new competitors or
competitive brands or competitive promotional activity or spending,
(2) changes in consumer demand for the various types of products
Spectrum Brands offers, (3) changes in the general economic conditions
where Spectrum Brands does business, such as interest rates, currency
exchange rates, inflation, consumer spending and raw material costs,
(4) the company's ability to successfully implement manufacturing,
distribution and other cost efficiencies and other restructuring
initiatives, and various other factors, including those discussed
herein and those set forth in Spectrum Brands' securities filings,
including the most recently filed Annual Report on Form 10-K and
Quarterly Report on Form 10-Q.
The company also cautions the reader that undue reliance should
not be placed on any forward-looking statements, which speak only as
of the date of this release. Spectrum Brands undertakes no duty or
responsibility to update any of these forward-looking statements to
reflect events or circumstances after the date of this report or to
reflect actual outcomes.
About Spectrum Brands, Inc.
Spectrum Brands is a global consumer products company and a
leading supplier of batteries, portable lighting, lawn and garden
products, household insect control, shaving and grooming products,
personal care products and specialty pet supplies. Spectrum Brands'
products are sold by the world's top 25 retailers and are available in
more than one million stores in 120 countries around the world.
Headquartered in Atlanta, Georgia, Spectrum Brands generated net sales
of $2.5 billion in fiscal 2006 and has approximately 8,400 employees
worldwide. The company's stock trades on the New York Stock Exchange
under the symbol SPC.
Spectrum Brands Fiscal 2007 Net Sales and EBITDA
Projections
-----------------------------------------------------
Remaining 6
Q1 Q2 Months Total
------------ ------------ ------------- -------------
Fiscal Year 2007 Sales EBITDA Sales EBITDA Sales EBITDA Sales EBITDA
- ----------------
Global Battery/
Personal Care $427 $ 46 $297 $ 28 $ 684 $ 79 $1,409 $153
Home & Garden 56 (18) 220 16 390 51 665 50
Pet 138 23 143 22 280 47 560 92
Corporate - (10) - (11) - (12) - (33)
----- ------ ----- ------ ------ ------ ------ ------
Consolidated $620 $ 41 $660 $ 55 $1,354 $165 $2,634 $262
===== ====== ===== ====== ====== ====== ====== ======
Reconciliation of EBITDA to Income From Continuing
Operations Before Interest and Taxes
Fiscal Year 2007 - First Quarter GBPC H&G Pet Corp Total
- ---------------------------------------- ------ ----- --- ----- ------
Income from Continuing Operations before
Interest and Taxes 40 - 13 (15) 38
Depreciation and Amortization 6 - 6 5 17
Restructuring and Related Charges (A) 3 - 4 - 7
Discontinued Operations (B) - (18) - - (18)
Brazilian IPI Credit (C) (3) - - - (3)
EBITDA $ 46 $(18) $23 $(10) $ 41
------ ----- --- ----- ------
Fiscal Year 2007 - Second Quarter GBPC H&G Pet Corp Total
- ---------------------------------------- ------ ----- --- ----- ------
Income from Continuing Operations before
Interest and Taxes (202) - 10 (20) (212)
Depreciation and Amortization 9 - 5 5 19
Restructuring and Related Charges (A) 10 - 7 - 17
Discontinued Operations (B) - 16 - - 16
Brazilian IPI Credit (C) (3) - - - (3)
Goodwill Impairment (D) 214 - - - 214
Professional fees - H&G Sale Process (E) - - - 4 4
EBITDA $ 28 $ 16 $22 $(11) $ 55
------ ----- --- ----- ------
Fiscal Year 2007 - Remaining Six Months GBPC H&G Pet Corp Total
- ---------------------------------------- ------ ----- --- ----- ------
Income from Continuing Operations before
Interest and Taxes 46 - 30 (34) 42
Depreciation and Amortization 17 - 11 4 32
Restructuring and Related Charges (A) 22 - 6 18 46
Discontinued Operations (B) - 51 - - 51
Brazilian IPI Credit (C) (6) - - - (6)
EBITDA $ 79 $ 51 $47 $(12) $ 165
------ ----- --- ----- ------
(A) Restructuring and related charges primarily reflect integration
initiatives associated with the United and Tetra acquisitions, a
series of actions in Europe to reduce operating costs and rationalize
operating structure as well as initiatives announced in fiscal year
2007 to rationalize and streamline our global operating structure.
(B) Represents the operating income (loss) of the Home and Garden
business which has been reflected as a discontinued operation as of
October 1, 2007.
(C) Represents the benefit related to expiring penalties associated
with the Company's provision for presumed credits applied to the
Brazilian excise tax on manufactured products, which expire in the
respective period.
(D) Represents the impairment of goodwill written off as a result of a
performed evaluation in accordance with SFAS No. 142, "Goodwill and
Other Intangible Assets."
(E) Reflects professional fees incurred in connection with the sale of
the Company's Home & Garden business.
CONTACT: Spectrum Brands
Investor Contact
Nancy O'Donnell, 770-829-6208
VP Investor Relations
or
Sard Verbinnen & Co for Spectrum Brands
Media Contact
Victoria Hofstad or Jamie Tully, 212-687-8080