ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from
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to
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OHIO
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31-1414921
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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|
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|
14111 SCOTTSLAWN ROAD,
MARYSVILLE, OHIO
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43041
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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ý
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Accelerated filer
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o
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Non-accelerated filer
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o
(Do not check if a smaller reporting company)
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Smaller reporting company
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o
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Class
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Outstanding at February 2, 2015
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Common Shares, $0.01 stated value, no par value
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60,849,013 Common Shares
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THE SCOTTS MIRACLE-GRO COMPANY
INDEX
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||
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PAGE NO.
|
|
||
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|
||
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Condensed Consolidated Statements of Operations — Three months
ended December 27, 2014 and December 28, 2013
|
|
|
Condensed Consolidated Statements of Comprehensive Income (Loss) — Three months
ended December 27, 2014 and December 28, 2013
|
|
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Condensed Consolidated Statements of Cash Flows —
Three months ended December 27, 2014 and December 28, 2013
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Condensed Consolidated Balance Sheets —
December 27, 2014, December 28, 2013 and September 30, 2014
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||
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THREE MONTHS ENDED
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||||||
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DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
||||
Net sales
|
$
|
216.2
|
|
|
$
|
189.6
|
|
Cost of sales
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186.9
|
|
|
155.7
|
|
||
Gross profit
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29.3
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|
|
33.9
|
|
||
Operating expenses:
|
|
|
|
||||
Selling, general and administrative
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126.9
|
|
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124.3
|
|
||
Impairment, restructuring and other
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9.6
|
|
|
0.3
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|
||
Other income, net
|
(1.2
|
)
|
|
(1.0
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)
|
||
Loss from operations
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(106.0
|
)
|
|
(89.7
|
)
|
||
Interest expense
|
9.7
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|
|
13.9
|
|
||
Loss from continuing operations before income taxes
|
(115.7
|
)
|
|
(103.6
|
)
|
||
Income tax benefit from continuing operations
|
(41.7
|
)
|
|
(37.9
|
)
|
||
Loss from continuing operations
|
(74.0
|
)
|
|
(65.7
|
)
|
||
Income from discontinued operations, net of tax
|
—
|
|
|
0.1
|
|
||
Net loss
|
$
|
(74.0
|
)
|
|
$
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(65.6
|
)
|
Net income attributable to noncontrolling interest
|
$
|
(0.6
|
)
|
|
$
|
—
|
|
Net loss attributable to controlling interest
|
$
|
(74.6
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)
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|
$
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(65.6
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)
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Basic loss per common share:
|
|
|
|
||||
Loss from continuing operations
|
$
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(1.23
|
)
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|
$
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(1.06
|
)
|
Income from discontinued operations
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—
|
|
|
—
|
|
||
Basic loss per common share
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$
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(1.23
|
)
|
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$
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(1.06
|
)
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Weighted-average common shares outstanding during the period
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60.8
|
|
|
62.1
|
|
||
Diluted loss per common share:
|
|
|
|
||||
Loss from continuing operations
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$
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(1.23
|
)
|
|
$
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(1.06
|
)
|
Income from discontinued operations
|
—
|
|
|
—
|
|
||
Diluted loss per common share
|
$
|
(1.23
|
)
|
|
$
|
(1.06
|
)
|
Weighted-average common shares outstanding during the period plus dilutive potential common shares
|
60.8
|
|
|
62.1
|
|
||
Dividends declared per common share
|
$
|
0.450
|
|
|
$
|
0.438
|
|
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THREE MONTHS ENDED
|
||||||
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DECEMBER 27,
2014 |
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DECEMBER 28,
2013 |
||||
Net loss
|
$
|
(74.0
|
)
|
|
$
|
(65.6
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
||||
Net foreign currency translation adjustment
|
(3.0
|
)
|
|
(1.4
|
)
|
||
Net unrealized gains (loss) on derivative instruments, net of tax of $(0.7) and $0.2, respectively
|
(1.1
|
)
|
|
0.4
|
|
||
Reclassification of net unrealized loss on derivatives to net income, net of tax of $0.6 and $1.9, respectively
|
1.0
|
|
|
3.1
|
|
||
Net unrealized (loss) in pension and other post-retirement benefits, net of tax of $0.0 and $0.2, respectively
|
—
|
|
|
(0.3
|
)
|
||
Reclassification of net pension and post-retirement benefit income (loss) to net income, net of tax of $0.5 and $0.5, respectively
|
0.8
|
|
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0.8
|
|
||
Total other comprehensive (loss) income
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(2.3
|
)
|
|
2.6
|
|
||
Comprehensive loss
|
$
|
(76.3
|
)
|
|
$
|
(63.0
|
)
|
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THREE MONTHS ENDED
|
||||||
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DECEMBER 27,
2014 |
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DECEMBER 28,
2013 |
||||
OPERATING ACTIVITIES
|
|
|
|
||||
Net loss
|
$
|
(74.0
|
)
|
|
$
|
(65.6
|
)
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Impairment, restructuring and other
|
3.6
|
|
|
—
|
|
||
Share-based compensation expense
|
2.1
|
|
|
1.8
|
|
||
Depreciation
|
12.5
|
|
|
13.0
|
|
||
Amortization
|
3.7
|
|
|
3.1
|
|
||
Loss on sale of assets
|
—
|
|
|
0.1
|
|
||
Changes in assets and liabilities, net of acquired businesses:
|
|
|
|
||||
Accounts receivable
|
148.9
|
|
|
145.5
|
|
||
Inventories
|
(301.2
|
)
|
|
(278.9
|
)
|
||
Prepaid and other assets
|
(6.8
|
)
|
|
(6.9
|
)
|
||
Accounts payable
|
33.0
|
|
|
98.5
|
|
||
Other current liabilities
|
(93.8
|
)
|
|
(88.1
|
)
|
||
Restructuring reserves
|
2.1
|
|
|
(4.2
|
)
|
||
Other non-current items
|
5.8
|
|
|
1.7
|
|
||
Other, net
|
(2.9
|
)
|
|
(0.2
|
)
|
||
Net cash used in operating activities
|
(267.0
|
)
|
|
(180.2
|
)
|
||
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|
||||
INVESTING ACTIVITIES
|
|
|
|
||||
Investments in property, plant and equipment
|
(14.5
|
)
|
|
(43.4
|
)
|
||
Investment in acquired business, net of cash acquired
|
(11.1
|
)
|
|
(60.0
|
)
|
||
Net cash used in investing activities
|
(25.6
|
)
|
|
(103.4
|
)
|
||
|
|
|
|
||||
FINANCING ACTIVITIES
|
|
|
|
||||
Borrowings under revolving and bank lines of credit
|
539.6
|
|
|
508.3
|
|
||
Repayments under revolving and bank lines of credit
|
(167.1
|
)
|
|
(197.1
|
)
|
||
Financing and issuance fees
|
—
|
|
|
(6.1
|
)
|
||
Dividends paid
|
(27.4
|
)
|
|
(27.3
|
)
|
||
Purchase of common shares
|
(14.8
|
)
|
|
(8.5
|
)
|
||
Excess tax benefits from share-based payment arrangements
|
0.5
|
|
|
2.8
|
|
||
Cash received from the exercise of stock options
|
6.2
|
|
|
5.1
|
|
||
Net cash provided by financing activities
|
337.0
|
|
|
277.2
|
|
||
Effect of exchange rate changes on cash
|
(3.6
|
)
|
|
1.2
|
|
||
Net increase (decrease) in cash and cash equivalents
|
40.8
|
|
|
(5.2
|
)
|
||
Cash and cash equivalents, beginning of period
|
89.3
|
|
|
129.8
|
|
||
Cash and cash equivalents, end of period
|
$
|
130.1
|
|
|
$
|
124.6
|
|
|
|
|
|
||||
SUPPLEMENTAL CASH FLOW INFORMATION
|
|
|
|
||||
Interest paid
|
$
|
(11.2
|
)
|
|
$
|
(11.6
|
)
|
Income taxes paid
|
$
|
(8.6
|
)
|
|
$
|
(2.2
|
)
|
|
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
|
SEPTEMBER 30,
2014 |
||||||
ASSETS
|
|||||||||||
Current assets:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
130.1
|
|
|
$
|
124.6
|
|
|
$
|
89.3
|
|
Accounts receivable, less allowances of $6.8, $8.8 and $7.5, respectively
|
185.4
|
|
|
158.2
|
|
|
224.0
|
|
|||
Accounts receivable pledged
|
—
|
|
|
9.3
|
|
|
113.7
|
|
|||
Inventories
|
682.8
|
|
|
605.7
|
|
|
385.1
|
|
|||
Prepaid and other current assets
|
127.6
|
|
|
117.9
|
|
|
122.9
|
|
|||
Total current assets
|
1,125.9
|
|
|
1,015.7
|
|
|
935.0
|
|
|||
Property, plant and equipment, net of accumulated depreciation of $606.1, $586.6 and $597.2, respectively
|
434.4
|
|
|
447.5
|
|
|
437.0
|
|
|||
Goodwill
|
364.3
|
|
|
335.0
|
|
|
350.9
|
|
|||
Intangible assets, net
|
308.9
|
|
|
320.0
|
|
|
302.7
|
|
|||
Other assets
|
31.7
|
|
|
41.2
|
|
|
32.7
|
|
|||
Total assets
|
$
|
2,265.2
|
|
|
$
|
2,159.4
|
|
|
$
|
2,058.3
|
|
|
|
|
|
|
|
||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|||||||||||
Current liabilities:
|
|
|
|
|
|
||||||
Current portion of debt
|
$
|
36.6
|
|
|
$
|
229.7
|
|
|
$
|
91.9
|
|
Accounts payable
|
220.0
|
|
|
230.8
|
|
|
193.3
|
|
|||
Other current liabilities
|
165.3
|
|
|
188.4
|
|
|
259.5
|
|
|||
Total current liabilities
|
421.9
|
|
|
648.9
|
|
|
544.7
|
|
|||
Long term debt
|
1,133.3
|
|
|
652.3
|
|
|
692.4
|
|
|||
Other liabilities
|
249.1
|
|
|
236.9
|
|
|
254.0
|
|
|||
Total liabilities
|
1,804.3
|
|
|
1,538.1
|
|
|
1,491.1
|
|
|||
Contingencies (note 11)
|
|
|
|
|
|
||||||
Shareholders’ equity:
|
|
|
|
|
|
||||||
Common shares and capital in excess of $.01 stated value per
share; 60.7,
62.2 and 60.7 shares issued and outstanding, respectively
|
399.0
|
|
|
394.2
|
|
|
395.3
|
|
|||
Retained earnings
|
534.6
|
|
|
610.2
|
|
|
636.9
|
|
|||
Treasury shares, at co
st; 7.5, 6.0
and 7.4 shares, respectively
|
(398.2
|
)
|
|
(307.9
|
)
|
|
(392.3
|
)
|
|||
Accumulated other comprehensive loss
|
(88.6
|
)
|
|
(75.2
|
)
|
|
(86.2
|
)
|
|||
Total shareholders’ equity - controlling interest
|
446.8
|
|
|
621.3
|
|
|
553.7
|
|
|||
Noncontrolling interest
|
14.1
|
|
|
—
|
|
|
13.5
|
|
|||
Total equity
|
$
|
460.9
|
|
|
$
|
621.3
|
|
|
$
|
567.2
|
|
Total liabilities and shareholders’ equity
|
$
|
2,265.2
|
|
|
$
|
2,159.4
|
|
|
$
|
2,058.3
|
|
|
|
THREE MONTHS ENDED
|
||||||
|
|
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
||||
|
|
(In millions)
|
||||||
Net sales
|
|
$
|
—
|
|
|
$
|
6.8
|
|
Operating costs
|
|
—
|
|
|
6.6
|
|
||
Gain on sale of assets
|
|
—
|
|
|
—
|
|
||
Income from discontinued operations before income taxes
|
|
—
|
|
|
0.2
|
|
||
Income tax expense from discontinued operations
|
|
—
|
|
|
0.1
|
|
||
Income from discontinued operations, net of tax
|
|
$
|
—
|
|
|
$
|
0.1
|
|
|
THREE MONTHS ENDED
|
||||||
|
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
||||
|
(In millions)
|
||||||
Restructuring and other
|
$
|
9.6
|
|
|
$
|
0.3
|
|
Goodwill and intangible asset impairments
|
—
|
|
|
—
|
|
||
Total impairment, restructuring and other
|
$
|
9.6
|
|
|
$
|
0.3
|
|
Amounts reserved for restructuring and other charges at September 30, 2014
|
$
|
16.0
|
|
Restructuring and other charges
|
9.6
|
|
|
Payments and other
|
(7.7
|
)
|
|
Amounts reserved for restructuring and other charges at December 27, 2014
|
$
|
17.9
|
|
|
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
|
SEPTEMBER 30,
2014 |
||||||
|
(In millions)
|
||||||||||
Finished goods
|
$
|
476.4
|
|
|
$
|
412.4
|
|
|
$
|
217.5
|
|
Work-in-process
|
60.5
|
|
|
49.8
|
|
|
46.2
|
|
|||
Raw materials
|
145.9
|
|
|
143.5
|
|
|
121.4
|
|
|||
Total inventories
|
$
|
682.8
|
|
|
$
|
605.7
|
|
|
$
|
385.1
|
|
|
THREE MONTHS ENDED
|
||||||
|
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
||||
|
(In millions)
|
||||||
Gross commission
|
$
|
—
|
|
|
$
|
—
|
|
Contribution expenses
|
(5.0
|
)
|
|
(5.0
|
)
|
||
Amortization of marketing fee
|
(0.2
|
)
|
|
(0.2
|
)
|
||
Net commission income
|
(5.2
|
)
|
|
(5.2
|
)
|
||
Reimbursements associated with Marketing Agreement
|
17.3
|
|
|
15.1
|
|
||
Total net sales associated with Marketing Agreement
|
$
|
12.1
|
|
|
$
|
9.9
|
|
|
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
|
SEPTEMBER 30,
2014 |
||||||
|
(In millions)
|
||||||||||
Credit facility – Revolving loans
|
$
|
922.9
|
|
|
$
|
447.4
|
|
|
$
|
481.8
|
|
Senior Notes – 7.25%
|
—
|
|
|
200.0
|
|
|
—
|
|
|||
Senior Notes – 6.625%
|
200.0
|
|
|
200.0
|
|
|
200.0
|
|
|||
Master Accounts Receivable Purchase Agreement
|
—
|
|
|
7.4
|
|
|
84.0
|
|
|||
Other
|
47.0
|
|
|
27.2
|
|
|
18.5
|
|
|||
|
1,169.9
|
|
|
882.0
|
|
|
784.3
|
|
|||
Less current portions
|
36.6
|
|
|
229.7
|
|
|
91.9
|
|
|||
Total long-term debt
|
$
|
1,133.3
|
|
|
$
|
652.3
|
|
|
$
|
692.4
|
|
Notional Amount
(in millions)
|
|
Effective
Date (a)
|
|
Expiration
Date
|
|
Fixed
Rate
|
||
$
|
50
|
|
|
2/14/2012
|
|
2/14/2016
|
|
3.78%
|
150
|
|
(b)
|
2/7/2012
|
|
5/7/2016
|
|
2.42%
|
|
150
|
|
(c)
|
11/16/2009
|
|
5/16/2016
|
|
3.26%
|
|
50
|
|
(b)
|
2/16/2010
|
|
5/16/2016
|
|
3.05%
|
|
100
|
|
(b)
|
2/21/2012
|
|
5/23/2016
|
|
2.40%
|
|
150
|
|
(c)
|
12/20/2011
|
|
6/20/2016
|
|
2.61%
|
|
50
|
|
(d)
|
12/6/2012
|
|
9/6/2017
|
|
2.96%
|
|
200
|
|
|
2/7/2014
|
|
11/7/2017
|
|
1.28%
|
|
150
|
|
(b)
|
2/7/2017
|
|
5/7/2019
|
|
2.12%
|
|
50
|
|
(c)
|
2/7/2017
|
|
5/7/2019
|
|
2.25%
|
|
200
|
|
(c)
|
12/20/2016
|
|
6/20/2019
|
|
2.12%
|
(a)
|
The effective date refers to the date on which interest payments were, or will be, first hedged by the applicable swap agreement.
|
(b)
|
Interest payments made during the three-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement.
|
(c)
|
Interest payments made during the six-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement.
|
(d)
|
Interest payments made during the nine-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement.
|
|
THREE MONTHS ENDED
|
||||||||||||||||||||||
|
DECEMBER 27, 2014
|
|
DECEMBER 28, 2013
|
||||||||||||||||||||
|
U.S.
Pension
|
|
International
Pension
|
|
U.S.
Medical
|
|
U.S.
Pension
|
|
International
Pension
|
|
U.S.
Medical
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Service cost
|
$
|
—
|
|
|
$
|
0.3
|
|
|
$
|
0.1
|
|
|
$
|
—
|
|
|
$
|
0.5
|
|
|
$
|
0.1
|
|
Interest cost
|
1.0
|
|
|
1.9
|
|
|
0.3
|
|
|
1.1
|
|
|
3.2
|
|
|
0.3
|
|
||||||
Expected return on plan assets
|
(1.3
|
)
|
|
(2.3
|
)
|
|
—
|
|
|
(1.3
|
)
|
|
(3.6
|
)
|
|
—
|
|
||||||
Net amortization
|
0.8
|
|
|
0.5
|
|
|
—
|
|
|
1.0
|
|
|
0.5
|
|
|
—
|
|
||||||
Net periodic benefit cost
|
$
|
0.5
|
|
|
$
|
0.4
|
|
|
$
|
0.4
|
|
|
$
|
0.8
|
|
|
$
|
0.6
|
|
|
$
|
0.4
|
|
|
THREE MONTHS ENDED
|
||||||
|
DECEMBER 27, 2014
|
|
DECEMBER 28, 2013
|
||||
Employees
|
|
|
|
||||
Restricted stock units
|
—
|
|
|
31,032
|
|
||
Board of Directors
|
|
|
|
||||
Deferred stock units
|
1,355
|
|
|
1,035
|
|
||
Total share-based awards
|
1,355
|
|
|
32,067
|
|
||
|
|
|
|
||||
Aggregate fair value at grant dates (in millions)
|
$
|
0.1
|
|
|
$
|
1.9
|
|
|
THREE MONTHS ENDED
|
||||||
|
DECEMBER 27, 2014
|
|
DECEMBER 28, 2013
|
||||
|
(In millions)
|
||||||
Share-based compensation
|
$
|
2.1
|
|
|
$
|
1.8
|
|
Tax benefit recognized
|
0.8
|
|
|
0.7
|
|
DERIVATIVES IN CASH FLOW HEDGING RELATIONSHIPS
|
|
AMOUNT OF GAIN / (LOSS) RECOGNIZED IN AOCI
|
|||||||
|
THREE MONTHS ENDED
|
|
|||||||
|
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
|
|||||
|
|
(In millions)
|
|||||||
Interest rate swap agreements
|
|
$
|
(1.7
|
)
|
|
$
|
(0.8
|
)
|
|
Commodity hedging instruments
|
|
0.6
|
|
|
1.2
|
|
|
||
Total
|
|
$
|
(1.1
|
)
|
|
$
|
0.4
|
|
|
DERIVATIVES IN CASH FLOW
HEDGING RELATIONSHIPS
|
|
RECLASSIFIED FROM AOCI INTO STATEMENT OF OPERATIONS
|
|
AMOUNT OF GAIN / (LOSS)
|
|||||||
THREE MONTHS ENDED
|
|
||||||||||
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
|
||||||||
|
|
|
|
(In millions)
|
|||||||
Interest rate swap agreements
|
|
Interest expense
|
|
$
|
(1.0
|
)
|
|
$
|
(3.1
|
)
|
|
Commodity hedging instruments
|
|
Cost of sales
|
|
—
|
|
|
—
|
|
|
||
Total
|
|
|
|
$
|
(1.0
|
)
|
|
$
|
(3.1
|
)
|
|
DERIVATIVES NOT DESIGNATED
AS HEDGING INSTRUMENTS
|
|
RECOGNIZED IN
STATEMENT OF OPERATIONS
|
|
AMOUNT OF GAIN / (LOSS)
|
|||||||
THREE MONTHS ENDED
|
|
||||||||||
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
|
||||||||
|
|
|
|
(In millions)
|
|||||||
Foreign currency forward contracts
|
|
Other income, net
|
|
$
|
3.1
|
|
|
$
|
(1.3
|
)
|
|
Commodity hedging instruments
|
|
Cost of sales
|
|
(8.3
|
)
|
|
0.6
|
|
|
||
Total
|
|
|
|
$
|
(5.2
|
)
|
|
$
|
(0.7
|
)
|
|
|
Quoted Prices in Active
Markets for Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
|
(In millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
88.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
88.8
|
|
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
—
|
|
|
2.2
|
|
|
—
|
|
|
2.2
|
|
||||
Foreign currency forward contracts
|
—
|
|
|
1.2
|
|
|
—
|
|
|
1.2
|
|
||||
Commodity hedging instruments
|
—
|
|
|
0.4
|
|
|
—
|
|
|
0.4
|
|
||||
Other
|
10.1
|
|
|
—
|
|
|
—
|
|
|
10.1
|
|
||||
Total
|
$
|
98.9
|
|
|
$
|
3.8
|
|
|
$
|
—
|
|
|
$
|
102.7
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
$
|
—
|
|
|
$
|
(15.4
|
)
|
|
$
|
—
|
|
|
$
|
(15.4
|
)
|
Commodity hedging instruments
|
—
|
|
|
(9.1
|
)
|
|
—
|
|
|
(9.1
|
)
|
||||
Total
|
$
|
—
|
|
|
$
|
(24.5
|
)
|
|
$
|
—
|
|
|
$
|
(24.5
|
)
|
|
Quoted Prices in Active
Markets for Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
|
(In millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
85.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
85.6
|
|
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
—
|
|
|
4.8
|
|
|
—
|
|
|
4.8
|
|
||||
Commodity hedging instruments
|
—
|
|
|
1.5
|
|
|
—
|
|
|
1.5
|
|
||||
Other
|
7.6
|
|
|
—
|
|
|
—
|
|
|
7.6
|
|
||||
Total
|
$
|
93.2
|
|
|
$
|
6.3
|
|
|
$
|
—
|
|
|
$
|
99.5
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
$
|
—
|
|
|
$
|
(20.4
|
)
|
|
$
|
—
|
|
|
$
|
(20.4
|
)
|
Foreign currency forward contracts
|
—
|
|
|
(0.5
|
)
|
|
—
|
|
|
(0.5
|
)
|
||||
Total
|
$
|
—
|
|
|
$
|
(20.9
|
)
|
|
$
|
—
|
|
|
$
|
(20.9
|
)
|
|
Quoted Prices in Active
Markets for Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
|
(In millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
32.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
32.0
|
|
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
—
|
|
|
4.0
|
|
|
—
|
|
|
4.0
|
|
||||
Other
|
8.9
|
|
|
—
|
|
|
—
|
|
|
8.9
|
|
||||
Total
|
$
|
40.9
|
|
|
$
|
4.0
|
|
|
$
|
—
|
|
|
$
|
44.9
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
$
|
—
|
|
|
$
|
(15.5
|
)
|
|
$
|
—
|
|
|
$
|
(15.5
|
)
|
Foreign currency forward contracts
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
(0.1
|
)
|
||||
Commodity hedging instruments
|
—
|
|
|
(1.9
|
)
|
|
—
|
|
|
(1.9
|
)
|
||||
Total
|
$
|
—
|
|
|
$
|
(17.5
|
)
|
|
$
|
—
|
|
|
$
|
(17.5
|
)
|
|
||||||||
|
THREE MONTHS ENDED
|
|
||||||
|
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
|
||||
|
(In millions)
|
|||||||
Net sales:
|
|
|
|
|
||||
Global Consumer
|
$
|
163.6
|
|
|
$
|
138.4
|
|
|
Scotts LawnService
®
|
46.7
|
|
|
46.3
|
|
|
||
Segment total
|
210.3
|
|
|
184.7
|
|
|
||
Corporate & Other
|
5.9
|
|
|
4.9
|
|
|
||
Consolidated
|
$
|
216.2
|
|
|
$
|
189.6
|
|
|
Income (loss) from continuing operations before income taxes:
|
|
|
|
|
||||
Global Consumer
|
$
|
(74.2
|
)
|
|
$
|
(67.4
|
)
|
|
Scotts LawnService
®
|
1.5
|
|
|
2.6
|
|
|
||
Segment total
|
(72.7
|
)
|
|
(64.8
|
)
|
|
||
Corporate & Other
|
(20.2
|
)
|
|
(21.7
|
)
|
|
||
Intangible asset amortization
|
(3.5
|
)
|
|
(2.9
|
)
|
|
||
Impairment, restructuring and other
|
(9.6
|
)
|
|
(0.3
|
)
|
|
||
Interest expense
|
(9.7
|
)
|
|
(13.9
|
)
|
|
||
Consolidated
|
$
|
(115.7
|
)
|
|
$
|
(103.6
|
)
|
|
|
DECEMBER 27,
2014 |
|
DECEMBER 28,
2013 |
|
SEPTEMBER 30,
2014 |
||||||
|
(In millions)
|
||||||||||
Total assets:
|
|
|
|
|
|
||||||
Global Consumer
|
$
|
1,833.7
|
|
|
$
|
1,812.2
|
|
|
$
|
1,690.7
|
|
Scotts LawnService
®
|
191.8
|
|
|
168.0
|
|
|
191.3
|
|
|||
Corporate & Other
|
239.7
|
|
|
179.2
|
|
|
176.3
|
|
|||
Consolidated
|
$
|
2,265.2
|
|
|
$
|
2,159.4
|
|
|
$
|
2,058.3
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/Consolidations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
146.5
|
|
|
$
|
69.7
|
|
|
$
|
—
|
|
|
$
|
216.2
|
|
Cost of sales
|
—
|
|
|
130.5
|
|
|
56.4
|
|
|
—
|
|
|
186.9
|
|
|||||
Gross profit
|
—
|
|
|
16.0
|
|
|
13.3
|
|
|
—
|
|
|
29.3
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Selling, general and administrative
|
—
|
|
|
94.5
|
|
|
31.9
|
|
|
0.5
|
|
|
126.9
|
|
|||||
Impairment, restructuring and other
|
—
|
|
|
8.9
|
|
|
0.7
|
|
|
—
|
|
|
9.6
|
|
|||||
Other income, net
|
—
|
|
|
(1.2
|
)
|
|
—
|
|
|
—
|
|
|
(1.2
|
)
|
|||||
Loss from operations
|
—
|
|
|
(86.2
|
)
|
|
(19.3
|
)
|
|
(0.5
|
)
|
|
(106.0
|
)
|
|||||
Equity income in subsidiaries
|
69.2
|
|
|
3.4
|
|
|
—
|
|
|
(72.6
|
)
|
|
—
|
|
|||||
Other non-operating income
|
(4.5
|
)
|
|
—
|
|
|
(5.5
|
)
|
|
10.0
|
|
|
—
|
|
|||||
Interest expense
|
11.2
|
|
|
8.3
|
|
|
0.2
|
|
|
(10.0
|
)
|
|
9.7
|
|
|||||
Loss from continuing operations before income taxes
|
(75.9
|
)
|
|
(97.9
|
)
|
|
(14.0
|
)
|
|
72.1
|
|
|
(115.7
|
)
|
|||||
Income tax benefit from continuing operations
|
(2.4
|
)
|
|
(33.9
|
)
|
|
(5.4
|
)
|
|
—
|
|
|
(41.7
|
)
|
|||||
Loss from continuing operations
|
(73.5
|
)
|
|
(64.0
|
)
|
|
(8.6
|
)
|
|
72.1
|
|
|
(74.0
|
)
|
|||||
Income from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net loss
|
$
|
(73.5
|
)
|
|
$
|
(64.0
|
)
|
|
$
|
(8.6
|
)
|
|
$
|
72.1
|
|
|
$
|
(74.0
|
)
|
Net income attributable to noncontrolling interest
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(0.6
|
)
|
|
$
|
(0.6
|
)
|
Net loss attributable to controlling interest
|
$
|
(73.5
|
)
|
|
$
|
(64.0
|
)
|
|
$
|
(8.6
|
)
|
|
$
|
71.5
|
|
|
$
|
(74.6
|
)
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/Consolidations
|
|
Consolidated
|
||||||||||
Net loss
|
$
|
(73.5
|
)
|
|
$
|
(64.0
|
)
|
|
$
|
(8.6
|
)
|
|
$
|
72.1
|
|
|
$
|
(74.0
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net foreign currency translation adjustment
|
(3.0
|
)
|
|
—
|
|
|
(3.0
|
)
|
|
3.0
|
|
|
(3.0
|
)
|
|||||
Net change in derivatives
|
(0.1
|
)
|
|
0.6
|
|
|
—
|
|
|
(0.6
|
)
|
|
(0.1
|
)
|
|||||
Net change in pension and other post retirement benefits
|
0.8
|
|
|
0.5
|
|
|
0.3
|
|
|
(0.8
|
)
|
|
0.8
|
|
|||||
Total other comprehensive (loss) income
|
(2.3
|
)
|
|
1.1
|
|
|
(2.7
|
)
|
|
1.6
|
|
|
(2.3
|
)
|
|||||
Comprehensive loss
|
$
|
(75.8
|
)
|
|
$
|
(62.9
|
)
|
|
$
|
(11.3
|
)
|
|
$
|
73.7
|
|
|
$
|
(76.3
|
)
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/Consolidations
|
|
Consolidated
|
||||||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
(a)
|
$
|
24.9
|
|
|
$
|
(198.6
|
)
|
|
$
|
(40.2
|
)
|
|
$
|
(53.1
|
)
|
|
$
|
(267.0
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments in property, plant and equipment
|
—
|
|
|
(12.4
|
)
|
|
(2.1
|
)
|
|
—
|
|
|
(14.5
|
)
|
|||||
Investment in acquired business, net of cash acquired
|
—
|
|
|
(11.1
|
)
|
|
—
|
|
|
—
|
|
|
(11.1
|
)
|
|||||
Net cash used in investing activities
|
—
|
|
|
(23.5
|
)
|
|
(2.1
|
)
|
|
—
|
|
|
(25.6
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Borrowings under revolving and bank lines of credit
|
—
|
|
|
480.7
|
|
|
58.9
|
|
|
—
|
|
|
539.6
|
|
|||||
Repayments under revolving and bank lines of credit
|
—
|
|
|
(156.5
|
)
|
|
(10.6
|
)
|
|
—
|
|
|
(167.1
|
)
|
|||||
Dividends paid
|
(27.4
|
)
|
|
(48.9
|
)
|
|
(3.7
|
)
|
|
52.6
|
|
|
(27.4
|
)
|
|||||
Purchase of common shares
|
(14.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14.8
|
)
|
|||||
Excess tax benefits from share-based payment arrangements
|
—
|
|
|
0.5
|
|
|
—
|
|
|
—
|
|
|
0.5
|
|
|||||
Cash received from the exercise of stock options
|
6.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6.2
|
|
|||||
Intercompany financing
|
11.1
|
|
|
(12.9
|
)
|
|
1.3
|
|
|
0.5
|
|
|
—
|
|
|||||
Net cash (used in) provided by financing activities
|
(24.9
|
)
|
|
262.9
|
|
|
45.9
|
|
|
53.1
|
|
|
337.0
|
|
|||||
Effect of exchange rate changes on cash
|
—
|
|
|
—
|
|
|
(3.6
|
)
|
|
—
|
|
|
(3.6
|
)
|
|||||
Net increase in cash and cash equivalents
|
—
|
|
|
40.8
|
|
|
—
|
|
|
—
|
|
|
40.8
|
|
|||||
Cash and cash equivalents, beginning of period
|
—
|
|
|
23.1
|
|
|
66.2
|
|
|
—
|
|
|
89.3
|
|
|||||
Cash and cash equivalents, end of period
|
$
|
—
|
|
|
$
|
63.9
|
|
|
$
|
66.2
|
|
|
$
|
—
|
|
|
$
|
130.1
|
|
(a)
|
Cash received by the Parent from its subsidiaries in the form of dividends in the amount of
$48.9 million
represent return on investments and are included in cash flows from operating activities.
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/Consolidations
|
|
Consolidated
|
||||||||||
ASSETS
|
|||||||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
63.9
|
|
|
$
|
66.2
|
|
|
$
|
—
|
|
|
$
|
130.1
|
|
Accounts receivable, net
|
—
|
|
|
97.7
|
|
|
87.7
|
|
|
—
|
|
|
185.4
|
|
|||||
Inventories
|
—
|
|
|
547.2
|
|
|
135.6
|
|
|
—
|
|
|
682.8
|
|
|||||
Prepaid and other current assets
|
—
|
|
|
84.8
|
|
|
42.8
|
|
|
—
|
|
|
127.6
|
|
|||||
Total current assets
|
—
|
|
|
793.6
|
|
|
332.3
|
|
|
—
|
|
|
1,125.9
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
370.4
|
|
|
64.0
|
|
|
—
|
|
|
434.4
|
|
|||||
Goodwill
|
—
|
|
|
346.3
|
|
|
6.4
|
|
|
11.6
|
|
|
364.3
|
|
|||||
Intangible assets, net
|
—
|
|
|
247.4
|
|
|
48.5
|
|
|
13.0
|
|
|
308.9
|
|
|||||
Other assets
|
21.1
|
|
|
16.0
|
|
|
27.5
|
|
|
(32.9
|
)
|
|
31.7
|
|
|||||
Equity investment in subsidiaries
|
300.7
|
|
|
—
|
|
|
—
|
|
|
(300.7
|
)
|
|
—
|
|
|||||
Intercompany assets
|
1,266.6
|
|
|
—
|
|
|
—
|
|
|
(1,266.6
|
)
|
|
—
|
|
|||||
Total assets
|
$
|
1,588.4
|
|
|
$
|
1,773.7
|
|
|
$
|
478.7
|
|
|
$
|
(1,575.6
|
)
|
|
$
|
2,265.2
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|||||||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current portion of debt
|
$
|
—
|
|
|
$
|
16.0
|
|
|
$
|
20.6
|
|
|
$
|
—
|
|
|
$
|
36.6
|
|
Accounts payable
|
—
|
|
|
162.7
|
|
|
57.3
|
|
|
—
|
|
|
220.0
|
|
|||||
Other current liabilities
|
13.6
|
|
|
77.3
|
|
|
74.4
|
|
|
—
|
|
|
165.3
|
|
|||||
Total current liabilities
|
13.6
|
|
|
256.0
|
|
|
152.3
|
|
|
—
|
|
|
421.9
|
|
|||||
Long-term debt
|
1,122.9
|
|
|
888.4
|
|
|
44.8
|
|
|
(922.8
|
)
|
|
1,133.3
|
|
|||||
Other liabilities
|
5.1
|
|
|
224.9
|
|
|
47.0
|
|
|
(27.9
|
)
|
|
249.1
|
|
|||||
Equity investment in subsidiaries
|
—
|
|
|
99.0
|
|
|
—
|
|
|
(99.0
|
)
|
|
—
|
|
|||||
Intercompany liabilities
|
—
|
|
|
257.5
|
|
|
87.1
|
|
|
(344.6
|
)
|
|
—
|
|
|||||
Total liabilities
|
1,141.6
|
|
|
1,725.8
|
|
|
331.2
|
|
|
(1,394.3
|
)
|
|
1,804.3
|
|
|||||
Total shareholders' equity - controlling interest
|
446.8
|
|
|
47.9
|
|
|
147.5
|
|
|
(195.4
|
)
|
|
446.8
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
14.1
|
|
|
14.1
|
|
|||||
Total equity
|
$
|
446.8
|
|
|
$
|
47.9
|
|
|
$
|
147.5
|
|
|
$
|
(181.3
|
)
|
|
$
|
460.9
|
|
Total liabilities and shareholders’ equity
|
$
|
1,588.4
|
|
|
$
|
1,773.7
|
|
|
$
|
478.7
|
|
|
$
|
(1,575.6
|
)
|
|
$
|
2,265.2
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/Consolidations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
142.9
|
|
|
$
|
46.7
|
|
|
$
|
—
|
|
|
$
|
189.6
|
|
Cost of sales
|
—
|
|
|
118.1
|
|
|
37.6
|
|
|
—
|
|
|
155.7
|
|
|||||
Gross profit
|
—
|
|
|
24.8
|
|
|
9.1
|
|
|
—
|
|
|
33.9
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Selling, general and administrative
|
—
|
|
|
97.5
|
|
|
26.8
|
|
|
—
|
|
|
124.3
|
|
|||||
Impairment, restructuring and other
|
—
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
0.3
|
|
|||||
Other income, net
|
—
|
|
|
(1.0
|
)
|
|
—
|
|
|
—
|
|
|
(1.0
|
)
|
|||||
Loss from operations
|
—
|
|
|
(71.7
|
)
|
|
(18.0
|
)
|
|
—
|
|
|
(89.7
|
)
|
|||||
Equity income in subsidiaries
|
55.5
|
|
|
3.4
|
|
|
—
|
|
|
(58.9
|
)
|
|
—
|
|
|||||
Other non-operating income
|
(3.2
|
)
|
|
—
|
|
|
(5.8
|
)
|
|
9.0
|
|
|
—
|
|
|||||
Interest expense
|
13.6
|
|
|
9.1
|
|
|
0.2
|
|
|
(9.0
|
)
|
|
13.9
|
|
|||||
Loss from continuing operations before income taxes
|
(65.9
|
)
|
|
(84.2
|
)
|
|
(12.4
|
)
|
|
58.9
|
|
|
(103.6
|
)
|
|||||
Income tax benefit from continuing operations
|
(0.3
|
)
|
|
(33.1
|
)
|
|
(4.5
|
)
|
|
—
|
|
|
(37.9
|
)
|
|||||
Loss from continuing operations
|
(65.6
|
)
|
|
(51.1
|
)
|
|
(7.9
|
)
|
|
58.9
|
|
|
(65.7
|
)
|
|||||
Income (loss) from discontinued operations, net of tax
|
—
|
|
|
(0.1
|
)
|
|
0.2
|
|
|
—
|
|
|
0.1
|
|
|||||
Net loss
|
$
|
(65.6
|
)
|
|
$
|
(51.2
|
)
|
|
$
|
(7.7
|
)
|
|
$
|
58.9
|
|
|
$
|
(65.6
|
)
|
Net income attributable to noncontrolling interest
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net loss attributable to controlling interest
|
$
|
(65.6
|
)
|
|
$
|
(51.2
|
)
|
|
$
|
(7.7
|
)
|
|
$
|
58.9
|
|
|
$
|
(65.6
|
)
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/Consolidations
|
|
Consolidated
|
||||||||||
Net loss
|
$
|
(65.6
|
)
|
|
$
|
(51.2
|
)
|
|
$
|
(7.7
|
)
|
|
$
|
58.9
|
|
|
$
|
(65.6
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
(1.4
|
)
|
|
—
|
|
|
(1.4
|
)
|
|||||
Net change in derivatives
|
1.1
|
|
|
2.4
|
|
|
—
|
|
|
—
|
|
|
3.5
|
|
|||||
Net change in pension and other post retirement benefits
|
—
|
|
|
0.6
|
|
|
(0.1
|
)
|
|
—
|
|
|
0.5
|
|
|||||
Total other comprehensive income (loss)
|
1.1
|
|
|
3.0
|
|
|
(1.5
|
)
|
|
—
|
|
|
2.6
|
|
|||||
Comprehensive loss
|
$
|
(64.5
|
)
|
|
$
|
(48.2
|
)
|
|
$
|
(9.2
|
)
|
|
$
|
58.9
|
|
|
$
|
(63.0
|
)
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/Consolidations
|
|
Consolidated
|
||||||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
(a)
|
$
|
26.7
|
|
|
$
|
(128.4
|
)
|
|
$
|
(42.7
|
)
|
|
$
|
(35.8
|
)
|
|
$
|
(180.2
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments in property, plant and equipment
|
—
|
|
|
(41.5
|
)
|
|
(1.9
|
)
|
|
—
|
|
|
(43.4
|
)
|
|||||
Investment in acquired business, net of cash acquired
|
—
|
|
|
(60.0
|
)
|
|
—
|
|
|
—
|
|
|
(60.0
|
)
|
|||||
Net cash used in investing activities
|
—
|
|
|
(101.5
|
)
|
|
(1.9
|
)
|
|
—
|
|
|
(103.4
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Borrowings under revolving and bank lines of credit
|
—
|
|
|
389.5
|
|
|
118.8
|
|
|
—
|
|
|
508.3
|
|
|||||
Repayments under revolving and bank lines of credit
|
—
|
|
|
(96.0
|
)
|
|
(101.1
|
)
|
|
—
|
|
|
(197.1
|
)
|
|||||
Financing and issuance fees
|
(6.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6.1
|
)
|
|||||
Dividends paid
|
(27.3
|
)
|
|
(35.8
|
)
|
|
—
|
|
|
35.8
|
|
|
(27.3
|
)
|
|||||
Purchase of common shares
|
(8.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8.5
|
)
|
|||||
Excess tax benefits from share-based payment arrangements
|
—
|
|
|
2.8
|
|
|
—
|
|
|
—
|
|
|
2.8
|
|
|||||
Cash received from the exercise of stock options
|
5.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5.1
|
|
|||||
Intercompany financing
|
10.1
|
|
|
(31.9
|
)
|
|
21.8
|
|
|
—
|
|
|
—
|
|
|||||
Net cash (used in) provided by financing activities
|
(26.7
|
)
|
|
228.6
|
|
|
39.5
|
|
|
35.8
|
|
|
277.2
|
|
|||||
Effect of exchange rate changes on cash
|
—
|
|
|
—
|
|
|
1.2
|
|
|
—
|
|
|
1.2
|
|
|||||
Net decrease in cash and cash equivalents
|
—
|
|
|
(1.3
|
)
|
|
(3.9
|
)
|
|
—
|
|
|
(5.2
|
)
|
|||||
Cash and cash equivalents, beginning of period
|
—
|
|
|
2.6
|
|
|
127.2
|
|
|
—
|
|
|
129.8
|
|
|||||
Cash and cash equivalents, end of period
|
$
|
—
|
|
|
$
|
1.3
|
|
|
$
|
123.3
|
|
|
$
|
—
|
|
|
$
|
124.6
|
|
(a)
|
Cash received by the Parent from its subsidiaries in the form of dividends in the amount of
$35.8 million
represent return on investments and are included in cash flows from operating activities.
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/Consolidations
|
|
Consolidated
|
||||||||||
ASSETS
|
|||||||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
1.3
|
|
|
$
|
123.3
|
|
|
$
|
—
|
|
|
$
|
124.6
|
|
Accounts receivable, net
|
—
|
|
|
73.7
|
|
|
84.5
|
|
|
—
|
|
|
158.2
|
|
|||||
Accounts receivable pledged
|
—
|
|
|
9.3
|
|
|
—
|
|
|
—
|
|
|
9.3
|
|
|||||
Inventories
|
—
|
|
|
492.6
|
|
|
113.1
|
|
|
—
|
|
|
605.7
|
|
|||||
Prepaid and other current assets
|
—
|
|
|
78.1
|
|
|
39.8
|
|
|
—
|
|
|
117.9
|
|
|||||
Total current assets
|
—
|
|
|
655.0
|
|
|
360.7
|
|
|
—
|
|
|
1,015.7
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
404.0
|
|
|
43.5
|
|
|
—
|
|
|
447.5
|
|
|||||
Goodwill
|
—
|
|
|
334.4
|
|
|
0.6
|
|
|
—
|
|
|
335.0
|
|
|||||
Intangible assets, net
|
—
|
|
|
281.1
|
|
|
38.9
|
|
|
—
|
|
|
320.0
|
|
|||||
Other assets
|
32.4
|
|
|
14.0
|
|
|
29.1
|
|
|
(34.3
|
)
|
|
41.2
|
|
|||||
Equity investment in subsidiaries
|
399.0
|
|
|
—
|
|
|
—
|
|
|
(399.0
|
)
|
|
—
|
|
|||||
Intercompany assets
|
1,066.1
|
|
|
—
|
|
|
—
|
|
|
(1,066.1
|
)
|
|
—
|
|
|||||
Total assets
|
$
|
1,497.5
|
|
|
$
|
1,688.5
|
|
|
$
|
472.8
|
|
|
$
|
(1,499.4
|
)
|
|
$
|
2,159.4
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|||||||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current portion of debt
|
$
|
200.0
|
|
|
$
|
9.3
|
|
|
$
|
20.4
|
|
|
$
|
—
|
|
|
$
|
229.7
|
|
Accounts payable
|
—
|
|
|
166.4
|
|
|
64.4
|
|
|
—
|
|
|
230.8
|
|
|||||
Other current liabilities
|
16.7
|
|
|
103.7
|
|
|
68.0
|
|
|
—
|
|
|
188.4
|
|
|||||
Total current liabilities
|
216.7
|
|
|
279.4
|
|
|
152.8
|
|
|
—
|
|
|
648.9
|
|
|||||
Long-term debt
|
647.4
|
|
|
439.4
|
|
|
12.9
|
|
|
(447.4
|
)
|
|
652.3
|
|
|||||
Other liabilities
|
12.1
|
|
|
213.1
|
|
|
46.0
|
|
|
(34.3
|
)
|
|
236.9
|
|
|||||
Equity investment in subsidiaries
|
—
|
|
|
170.3
|
|
|
—
|
|
|
(170.3
|
)
|
|
—
|
|
|||||
Intercompany liabilities
|
—
|
|
|
451.3
|
|
|
167.4
|
|
|
(618.7
|
)
|
|
—
|
|
|||||
Total liabilities
|
876.2
|
|
|
1,553.5
|
|
|
379.1
|
|
|
(1,270.7
|
)
|
|
1,538.1
|
|
|||||
Total shareholders' equity - controlling interest
|
621.3
|
|
|
135.0
|
|
|
93.7
|
|
|
(228.7
|
)
|
|
621.3
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total equity
|
$
|
621.3
|
|
|
$
|
135.0
|
|
|
$
|
93.7
|
|
|
$
|
(228.7
|
)
|
|
$
|
621.3
|
|
Total liabilities and shareholders’ equity
|
$
|
1,497.5
|
|
|
$
|
1,688.5
|
|
|
$
|
472.8
|
|
|
$
|
(1,499.4
|
)
|
|
$
|
2,159.4
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/Consolidations
|
|
Consolidated
|
||||||||||
ASSETS
|
|||||||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
23.1
|
|
|
$
|
66.2
|
|
|
$
|
—
|
|
|
$
|
89.3
|
|
Accounts receivable, net
|
—
|
|
|
124.6
|
|
|
99.4
|
|
|
—
|
|
|
224.0
|
|
|||||
Accounts receivable pledged
|
—
|
|
|
113.7
|
|
|
—
|
|
|
—
|
|
|
113.7
|
|
|||||
Inventories
|
—
|
|
|
282.1
|
|
|
103.0
|
|
|
—
|
|
|
385.1
|
|
|||||
Prepaid and other current assets
|
—
|
|
|
85.0
|
|
|
37.9
|
|
|
—
|
|
|
122.9
|
|
|||||
Total current assets
|
—
|
|
|
628.5
|
|
|
306.5
|
|
|
—
|
|
|
935.0
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
369.5
|
|
|
67.5
|
|
|
—
|
|
|
437.0
|
|
|||||
Goodwill
|
—
|
|
|
344.3
|
|
|
6.6
|
|
|
—
|
|
|
350.9
|
|
|||||
Intangible assets, net
|
—
|
|
|
256.8
|
|
|
45.9
|
|
|
—
|
|
|
302.7
|
|
|||||
Other assets
|
23.8
|
|
|
14.7
|
|
|
28.5
|
|
|
(34.3
|
)
|
|
32.7
|
|
|||||
Equity investment in subsidiaries
|
368.3
|
|
|
—
|
|
|
—
|
|
|
(368.3
|
)
|
|
—
|
|
|||||
Intercompany assets
|
878.8
|
|
|
—
|
|
|
—
|
|
|
(878.8
|
)
|
|
—
|
|
|||||
Total assets
|
$
|
1,270.9
|
|
|
$
|
1,613.8
|
|
|
$
|
455.0
|
|
|
$
|
(1,281.4
|
)
|
|
$
|
2,058.3
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|||||||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current portion of debt
|
$
|
—
|
|
|
$
|
85.8
|
|
|
$
|
6.1
|
|
|
$
|
—
|
|
|
$
|
91.9
|
|
Accounts payable
|
—
|
|
|
134.3
|
|
|
59.0
|
|
|
—
|
|
|
193.3
|
|
|||||
Other current liabilities
|
16.7
|
|
|
161.8
|
|
|
81.0
|
|
|
—
|
|
|
259.5
|
|
|||||
Total current liabilities
|
16.7
|
|
|
381.9
|
|
|
146.1
|
|
|
—
|
|
|
544.7
|
|
|||||
Long-term debt
|
681.8
|
|
|
480.0
|
|
|
12.4
|
|
|
(481.8
|
)
|
|
692.4
|
|
|||||
Other liabilities
|
5.1
|
|
|
235.7
|
|
|
47.4
|
|
|
(34.2
|
)
|
|
254.0
|
|
|||||
Equity investment in subsidiaries
|
—
|
|
|
106.5
|
|
|
—
|
|
|
(106.5
|
)
|
|
—
|
|
|||||
Intercompany liabilities
|
—
|
|
|
303.5
|
|
|
93.5
|
|
|
(397.0
|
)
|
|
—
|
|
|||||
Total liabilities
|
703.6
|
|
|
1,507.6
|
|
|
299.4
|
|
|
(1,019.5
|
)
|
|
1,491.1
|
|
|||||
Total shareholders' equity - controlling interest
|
553.8
|
|
|
92.7
|
|
|
155.6
|
|
|
(248.4
|
)
|
|
553.7
|
|
|||||
Noncontrolling interest
|
13.5
|
|
|
13.5
|
|
|
—
|
|
|
(13.5
|
)
|
|
13.5
|
|
|||||
Total equity
|
$
|
567.3
|
|
|
$
|
106.2
|
|
|
$
|
155.6
|
|
|
$
|
(261.9
|
)
|
|
$
|
567.2
|
|
Total liabilities and shareholders’ equity
|
$
|
1,270.9
|
|
|
$
|
1,613.8
|
|
|
$
|
455.0
|
|
|
$
|
(1,281.4
|
)
|
|
$
|
2,058.3
|
|
•
|
Executive summary
|
•
|
Results of operations
|
•
|
Segment results
|
•
|
Liquidity and capital resources
|
•
|
Regulatory matters
|
•
|
Critical accounting policies and estimates
|
|
Percent of Net Sales from
Continuing Operations by Quarter
|
|||||||
|
2014
|
|
2013
|
|
2012
|
|||
First Quarter
|
6.7
|
%
|
|
7.0
|
%
|
|
6.7
|
%
|
Second Quarter
|
38.0
|
%
|
|
36.4
|
%
|
|
41.7
|
%
|
Third Quarter
|
39.3
|
%
|
|
41.0
|
%
|
|
37.5
|
%
|
Fourth Quarter
|
16.0
|
%
|
|
15.6
|
%
|
|
14.1
|
%
|
•
|
a special one-time cash dividend of $2.00 per Common Share that was paid on September 17, 2014;
|
•
|
an increase in our quarterly cash dividend from $0.4375 to $0.45 per Common Share; and
|
•
|
a new share repurchase authorization effective November 1, 2014, which will expire on September 30, 2019, to repurchase up to $500 million of our Common Shares. This replaces the previous authorization which expired on September 30, 2014.
|
|
THREE MONTHS ENDED
|
||||
|
DECEMBER 27, 2014
|
|
DECEMBER 28, 2013
|
||
Net sales
|
100.0
|
%
|
|
100.0
|
%
|
Cost of sales
|
86.4
|
|
|
82.2
|
|
Gross profit
|
13.6
|
|
|
17.8
|
|
Operating expenses:
|
|
|
|
||
Selling, general and administrative
|
58.7
|
|
|
65.6
|
|
Impairment, restructuring and other
|
4.4
|
|
|
0.2
|
|
Other income, net
|
(0.6
|
)
|
|
(0.5
|
)
|
Loss from operations
|
(48.9
|
)
|
|
(47.5
|
)
|
Interest expense
|
4.6
|
|
|
7.3
|
|
Loss from continuing operations before income taxes
|
(53.5
|
)
|
|
(54.8
|
)
|
Income tax benefit from continuing operations
|
(19.3
|
)
|
|
(20.0
|
)
|
Loss from continuing operations
|
(34.2
|
)
|
|
(34.8
|
)
|
Income from discontinued operations, net of tax
|
—
|
|
|
0.1
|
|
Net Loss
|
(34.2
|
)%
|
|
(34.7
|
)%
|
|
THREE MONTHS ENDED
|
|
|
DECEMBER 27, 2014
|
|
Acquisitions
|
12.5
|
%
|
Volume
|
3.7
|
|
Pricing
|
0.3
|
|
Foreign exchange rates
|
(2.5
|
)
|
Change in net sales
|
14.0
|
%
|
•
|
sales from acquisitions within our Global Consumer segment from AeroGrow, Fafard, and Solus and within our Scotts LawnService
®
segment from Action Pest; and
|
•
|
increased volume in our Global Consumer segment, driven by timing of shipments to retailers earlier in the lawn and garden season and an increase in net sales attributable to reimbursements under our marketing agreement with Monsanto; and
|
•
|
a partial offset by the unfavorable impact of foreign exchange rates as a result of the strengthening of the U.S. dollar relative to other currencies.
|
|
THREE MONTHS ENDED
|
||||||
|
DECEMBER 27, 2014
|
|
DECEMBER 28, 2013
|
||||
|
(In millions)
|
||||||
Materials
|
$
|
91.9
|
|
|
$
|
80.9
|
|
Distribution and warehousing
|
48.7
|
|
|
35.6
|
|
||
Manufacturing labor and overhead
|
29.0
|
|
|
24.1
|
|
||
Roundup
®
reimbursements
|
17.3
|
|
|
15.1
|
|
||
|
$
|
186.9
|
|
|
$
|
155.7
|
|
|
THREE MONTHS ENDED
|
||
|
DECEMBER 27, 2014
|
||
|
(In millions)
|
||
Volume and product mix
|
$
|
32.7
|
|
Roundup
®
reimbursements
|
2.2
|
|
|
Foreign exchange rates
|
(3.6
|
)
|
|
Change in cost of sales
|
$
|
31.2
|
|
•
|
costs related to sales from acquisitions within our Global Consumer segment from AeroGrow, Fafard, and Solus and within our Scotts LawnService
®
segment from Action Pest;
|
•
|
higher distribution costs within our Global Consumer segment due to the recognition of negative mark-to-market adjustments of $6.8 million associated with our fuel hedges. We expect to offset the negative mark-to-market adjustments with savings from future fuel purchases within the current fiscal year;
|
•
|
increased sales volume in our Global Consumer segment, driven by timing of shipments to retailers earlier in the lawn and garden season; and
|
•
|
an increase in net sales attributable to reimbursements under our marketing agreement with Monsanto;
|
•
|
partially offset by the favorable impact of foreign exchange rates as a result of a strengthening of the U.S. dollar relative to other currencies.
|
|
THREE MONTHS ENDED
|
|
|
DECEMBER 27, 2014
|
|
Pricing
|
0.2
|
%
|
Material costs
|
—
|
|
Product mix and volume:
|
|
|
Roundup
®
commissions and reimbursements
|
(0.1
|
)
|
Acquisitions
|
0.5
|
|
Corporate & Other
|
0.2
|
|
Scotts LawnService
®
|
0.1
|
|
Global Consumer mix and volume
|
(5.1
|
)
|
Change in gross profit rate
|
(4.2
|
)%
|
•
|
increased distribution costs within Global Consumer segment mix and volume due to the recognition of negative mark-to-market adjustments of $6.8 million associated with our fuel hedges. We expect to offset the negative mark-to-market adjustments with savings from future fuel purchases within the current fiscal year; and
|
•
|
partially offset by the acquisitions of AeroGrow and Fafard within our Global Consumer segment and Action Pest within our Scotts LawnService
®
segment.
|
|
THREE MONTHS ENDED
|
||||||
|
DECEMBER 27, 2014
|
|
DECEMBER 28, 2013
|
||||
|
(In millions)
|
||||||
Advertising
|
$
|
9.5
|
|
|
$
|
7.5
|
|
Share-based compensation
|
2.1
|
|
|
1.8
|
|
||
Research and development
|
10.2
|
|
|
11.0
|
|
||
Amortization of intangibles
|
3.0
|
|
|
2.4
|
|
||
Other selling, general and administrative
|
102.1
|
|
|
101.6
|
|
||
|
$
|
126.9
|
|
|
$
|
124.3
|
|
|
THREE MONTHS ENDED
|
||||||
|
DECEMBER 27, 2014
|
|
DECEMBER 28, 2013
|
||||
|
(In millions)
|
||||||
Global Consumer
|
$
|
163.6
|
|
|
$
|
138.4
|
|
Scotts LawnService
®
|
46.7
|
|
|
46.3
|
|
||
Segment total
|
210.3
|
|
|
184.7
|
|
||
Corporate & Other
|
5.9
|
|
|
4.9
|
|
||
Consolidated
|
$
|
216.2
|
|
|
$
|
189.6
|
|
|
THREE MONTHS ENDED
|
||||||
|
DECEMBER 27, 2014
|
|
DECEMBER 28, 2013
|
||||
|
(In millions)
|
||||||
Global Consumer
|
$
|
(74.2
|
)
|
|
$
|
(67.4
|
)
|
Scotts LawnService
®
|
1.5
|
|
|
2.6
|
|
||
Segment total
|
(72.7
|
)
|
|
(64.8
|
)
|
||
Corporate & Other
|
(20.2
|
)
|
|
(21.7
|
)
|
||
Intangible asset amortization
|
(3.5
|
)
|
|
(2.9
|
)
|
||
Impairment, restructuring and other
|
(9.6
|
)
|
|
(0.3
|
)
|
||
Interest expense
|
(9.7
|
)
|
|
(13.9
|
)
|
||
Consolidated
|
$
|
(115.7
|
)
|
|
$
|
(103.6
|
)
|
Period
|
Total Number of
Common Shares
Purchased(1)
|
|
Average Price Paid
per Common Share(2)
|
|
Total Number of
Common Shares
Purchased as
Part of Publicly
Announced Plans or
Programs(3)
|
|
Approximate Dollar
Value of Common Shares
That May Yet be
Purchased Under the
Plans or Programs(3)
|
||||||
October 1, 2014 through October 25, 2014
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
500,000,000
|
|
October 26, 2014 through November 22, 2014
|
457
|
|
|
$
|
59.48
|
|
|
—
|
|
|
$
|
500,000,000
|
|
November 23 through December 27, 2014
|
241,120
|
|
|
$
|
62.02
|
|
|
238,863
|
|
|
$
|
485,186,044
|
|
Total
|
241,577
|
|
|
$
|
62.02
|
|
|
238,863
|
|
|
|
(1)
|
All of the Common Shares purchased during the quarter were purchased in open market transactions. The total number of Common Shares purchased during the quarter includes 2,715 Common Shares purchased by the trustee of the rabbi trust established by the Company as permitted pursuant to the terms of The Scotts Company LLC Executive Retirement Plan (the “ERP”). The ERP is an unfunded, non-qualified deferred compensation plan which, among other things, provides eligible employees the opportunity to defer compensation above specified statutory limits applicable to The Scotts Company LLC Retirement Savings Plan and with respect to any Executive Management Incentive Pay (as defined in the ERP), Performance Award (as defined in the ERP) or other bonus awarded to such eligible employees. Pursuant to the terms of the ERP, each eligible employee has the right to elect an investment fund, including a fund consisting of Common Shares (the “Scotts Miracle-Gro Common Stock Fund”), against which amounts allocated to such employee's account under the ERP, including employer contributions, will be benchmarked (all ERP accounts are bookkeeping accounts only and do not represent a claim against specific assets of the Company). Amounts allocated to employee accounts under the ERP represent deferred compensation obligations of the Company. The Company established the rabbi trust in order to assist the Company in discharging such deferred compensation obligations. When an eligible employee elects to benchmark some or all of the amounts allocated to such employee's account against the Scotts Miracle-Gro Common Stock Fund, the trustee of the rabbi trust purchases the number of Common Shares equivalent to the amount so benchmarked. All Common Shares purchased by the trustee are purchased on the open market and are held in the rabbi trust until such time as they are distributed pursuant to the terms of the ERP. All assets of the rabbi trust, including any Common Shares purchased by the trustee, remain, at all times, assets of the Company, subject to the claims of its creditors. The terms of the ERP do not provide for a specified limit on the number of Common Shares that may be purchased by the trustee of the rabbi trust.
|
|
|
(2)
|
The average price paid per Common Share is calculated on a settlement basis and includes commissions.
|
|
|
(3)
|
In August 2014, the Scotts Miracle-Gro Board of Directors authorized the repurchase of up to $500 million of the Common Shares over a five-year period (starting November 1, 2014 through September 30, 2019). The dollar amounts in the “Approximate Dollar Value” column reflect the remaining amounts of shares that were available for repurchase under the $500 million authorized repurchase program.
|
|
|
|
|
|
THE SCOTTS MIRACLE-GRO COMPANY
|
|
|
|
Date: February 5, 2015
|
|
/s/ THOMAS RANDAL COLEMAN
|
|
|
Printed Name: Thomas Randal Coleman
|
|
|
Title: Executive Vice President and Chief Financial Officer
|
EXHIBIT
NO.
|
|
DESCRIPTION
|
|
LOCATION
|
|
|
|
|
|
10.1
|
|
Separation Agreement and Release of All Claims, entered into as of December 18, 2014, by and between The Scotts Company LLC and Barry W. Sanders
|
|
Incorporated herein by reference to the Registrant's Current Report on Form 8-K filed December 19, 2014 (File No. 1-11593) [Exhibit 10.1]
|
|
|
|
|
|
10.2
|
|
The Scotts Company LLC Executive Retirement Plan, as Amended and Restated as of January 1, 2015 (executed December 31, 2014)
|
|
*
|
|
|
|
|
|
31.1
|
|
Rule 13a-14(a)/15d-14(a) Certifications (Principal Executive Officer)
|
|
*
|
|
|
|
|
|
31.2
|
|
Rule 13a-14(a)/15d-14(a) Certifications (Principal Financial Officer)
|
|
*
|
|
|
|
|
|
32
|
|
Section 1350 Certifications (Principal Executive Officer and Principal Financial Officer)
|
|
*
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
*
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema
|
|
*
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
*
|
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase
|
|
*
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase
|
|
*
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
*
|
*
|
Filed or furnished herewith
|
THE SCOTTS COMPANY LLC
|
/s/ DENISE S. STUMP
Denise S. Stump
Executive Vice President, Global Human Resources
|
2.1.
|
Account or Accounts 1
|
2.2.
|
Adjustments 1
|
2.3.
|
Affiliate 2
|
2.4.
|
Base Salary 2
|
2.5.
|
Base Salary Account 2
|
2.6.
|
Base Salary Deferral Election 2
|
2.7.
|
Beneficiary 2
|
2.8.
|
Benefits Administrative Committee 2
|
2.9.
|
Board 2
|
2.10.
|
Cause 3
|
2.11.
|
Change in Control 3
|
2.12.
|
Code 3
|
2.13.
|
Committee 3
|
2.14.
|
Company 3
|
2.15.
|
Company Stock Fund 3
|
2.16.
|
Compensation 3
|
2.17.
|
Corporation 3
|
2.18.
|
Disabled or Disability 3
|
2.19.
|
ERISA 4
|
2.20.
|
Effective Date 4
|
2.21.
|
Eligible Employee 4
|
2.22.
|
Employee 4
|
2.23.
|
Employer or Employers 4
|
2.24.
|
ERP Eligible Pay 4
|
2.25.
|
Investment Committee 4
|
2.26.
|
Investment Fund 4
|
2.27.
|
LTIP 4
|
2.28.
|
LTI Offset Payment 5
|
2.29.
|
Matching Account 5
|
2.30.
|
Outside Benchmark Investment Fund 5
|
2.31.
|
Pay Cap 5
|
2.32.
|
Participant 5
|
2.33.
|
Performance Award 5
|
2.34.
|
Performance Award Deferral Election 5
|
2.35.
|
Plan 5
|
2.36.
|
Plan Year 5
|
2.37.
|
Qualified Plan 6
|
2.38.
|
Retention Award 6
|
2.39.
|
Retention Award Account 6
|
2.40.
|
Retirement Account 6
|
2.41.
|
Retirement Contribution 6
|
2.42.
|
RSP Compensation 6
|
2.43.
|
Separation from Service 6
|
2.44.
|
Statutory Limits 7
|
2.45.
|
Supplemental Retirement Award 7
|
2.46.
|
Supplemental Retirement Award Account 7
|
2.47.
|
Transitional Contribution 7
|
2.48.
|
Transitional Contributions Account 7
|
2.49.
|
Years of Service 8
|
4.1.
|
Establishment of Accounts 8
|
4.2.
|
Election of Participant to Defer Performance Awards 8
|
4.3.
|
Election of Participant to Defer Base Salary 9
|
4.4.
|
Employer Contributions 10
|
4.5.
|
Benchmark Investment Funds 11
|
4.6.
|
Outside Benchmark Investment Funds 11
|
4.7.
|
Company Stock Fund 11
|
4.8.
|
Adjustment of Account Balances and Other Rules 11
|
4.9.
|
FICA 12
|
5.1.
|
Time and Form of Distribution 12
|
5.2.
|
Death Benefit 14
|
5.3.
|
Taxes 14
|
5.4.
|
Unforeseeable Emergency Distributions 14
|
5.5.
|
Small Benefit Distribution 15
|
5.6.
|
Distributions in the Event of a Change in Control 15
|
5.7.
|
Subsequent Deferral and Form of Payment Elections 15
|
10.1.
|
Filing Claims 17
|
10.2.
|
Notification to Claimant 17
|
10.3.
|
Review Procedure 17
|
10.4.
|
Decision on Review 18
|
12.1.
|
Controlling Law 19
|
12.2.
|
Captions 19
|
12.3.
|
Facility of Payment 19
|
12.4.
|
Administrative Expenses 19
|
12.5.
|
Severability 19
|
12.6.
|
Personal Liability 19
|
12.7.
|
Amendment to Qualified Plan or Changes to Employer Contributions and Participant Deferrals under Qualified Plan 20
|
12.8.
|
Right to Offset 20
|
2.1.
|
Account or Accounts
|
2.2.
|
Adjustments
|
2.4.
|
Base Salary
|
2.6.
|
Base Salary Deferral Election
|
2.7.
|
Beneficiary
|
2.8.
|
Benefits Administrative Committee
|
2.9.
|
Board
|
2.10.
|
Cause
|
2.11.
|
Change in Control
|
2.12.
|
Code
|
(a)
|
the maximum recognizable annual compensation under Code Section 401(a)(17);
|
(b)
|
the maximum annual additions under Code Section 415(c) - the “415 Limit”;
|
2.45.
|
Supplemental Retirement Award
|
2.46.
|
Supplemental Retirement Award Account
|
2.47.
|
Transitional Contribution
|
12.7.
|
Amendment to Qualified Plan or Changes to Employer Contributions and Participant Deferrals under Qualified Plan
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of The Scotts Miracle-Gro Company for the quarterly period ended
December 27, 2014
;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 5, 2015
|
|
By:
|
|
/s/ JAMES HAGEDORN
|
|
|
|
|
Printed Name: James Hagedorn
|
|
|
|
|
Title: Chief Executive Officer and Chairman of the Board
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of The Scotts Miracle-Gro Company for the quarterly period ended
December 27, 2014
;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 5, 2015
|
|
By:
|
|
/s/ THOMAS RANDAL COLEMAN
|
|
|
|
|
Printed Name: Thomas Randal Coleman
|
|
|
|
|
Title: Executive Vice President and Chief Financial Officer
|
1)
|
The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
|
2)
|
The information contained in the Report fairly presents, in all material respects, the consolidated financial condition and results of operations of the Company and its subsidiaries.
|
|
/s/ JAMES HAGEDORN
|
|
|
/s/ THOMAS RANDAL COLEMAN
|
|
Printed Name: James Hagedorn
|
|
|
Printed Name: Thomas Randal Coleman
|
|
Title: Chief Executive Officer and Chairman of the Board
|
|
|
Title: Executive Vice President and Chief Financial Officer
|
|
|
|
|
|
|
February 5, 2015
|
|
|
February 5, 2015
|
*
|
THESE CERTIFICATIONS ARE BEING FURNISHED AS REQUIRED BY RULE 13a-14(b) UNDER THE SECURITIES EXCHANGE ACT OF 1934 (THE “EXCHANGE ACT”) AND SECTION 1350 OF CHAPTER 63 OF TITLE 18 OF THE UNITED STATES CODE, AND SHALL NOT BE DEEMED “FILED” FOR PURPOSES OF SECTION 18 OF THE EXCHANGE ACT OR OTHERWISE SUBJECT TO THE LIABILITY OF THAT SECTION. THESE CERTIFICATIONS SHALL NOT BE DEEMED TO BE INCORPORATED BY REFERENCE INTO ANY FILING UNDER THE SECURITIES ACT OF 1933 OR THE EXCHANGE ACT, EXCEPT TO THE EXTENT THAT THE COMPANY SPECIFICALLY INCORPORATES THESE CERTIFICATIONS BY REFERENCE.
|